FranchiseVerdict
BUDDY’S HOME FURNISHINGS logo
A44/100FDD 2026

Buddy’s Home Furnishings — Litigation & Risk

Retail · FDD Items 3, 4 & 5

Back to overview

Moderate — Review

3 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
3
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
44 / 100
FranchiseVerdict composite
Rating
STRONG
STRONG / MODERATE / CAUTION / AVOID

7(a) FOIA data · FY2020–present

SBA Loan Performance

Aggregated from public SBA 7(a) loan disclosures. Default rate is the share of loans that were charged off or settled for less than the full balance.

Total 7(a) loans
21
Government-backed loans issued
Default rate
0.0%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
0 loans
Loans charged off or defaulted

FDD Items 5, 6 & 17 — what you give up

Contract Risk Indicators

Mandatory arbitration
Required
Disputes resolved outside court — limits your legal options
Jury trial waiver
Waived
You give up the right to a jury trial
Non-compete
1 yrs
Post-termination restriction on similar businesses
Franchisor can compete
Yes
Franchisor can open competing locations in or near your territory
Right of first refusal
Yes
Franchisor can match any purchase offer when you try to sell
Governing law
Florida
State whose law governs disputes — relevant if you're not based there

What drove the 44/100 rating

Risk Score Breakdown

  1. 01MEDSystem contracting severely: -35.3% unit decline YoY (223 units) signals franchisee exits and loss of confidence
  2. 02HIGHMultiple material litigation matters including $1.6M settled disputes, FTC Final Order regarding reciprocal purchase agreements, and ongoing Buddy Mac Holdings settlement—pattern of franchisor-franchisee conflicts
  3. 03MINORThin unit economics: $103,024 avg net income on $731,276 revenue (14.1% net margin) means franchisees earn only ~$8,585/month after 6% royalty and before owner labor/debt service on $375k-$798k investment
  4. 04HIGHNo Item 19 financial performance data (Going Concern = False) limits verification of franchise system viability claims
  5. 05MINORHigh initial investment ($375k-$798k) paired with collapsing unit count creates survivor bias risk—remaining franchisees may not be representative

Severity inferred from FDD text — not a regulatory or legal classification

Litigation data from FDD Items 3, 4, and 5. SBA data from public 7(a) FOIA records (FY2020–present). Not legal advice — consult a franchise attorney before signing any franchise agreement.