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B62/100FDD 2026

Byrider — Litigation & Risk

Automotive - Repair & Service · FDD Items 3, 4 & 5

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Elevated Risk

9 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
9
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
62 / 100
FranchiseVerdict composite
Rating
MODERATE
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
7
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
Indiana
State whose law governs disputes — relevant if you're not based there

What drove the 62/100 rating

Risk Score Breakdown

  1. 01MINORSystem declining sharply with 10% unit contraction YoY (99 to ~89 units) indicating franchisee dissatisfaction and market weakness
  2. 02HIGHMultiple litigation cases including two state attorney general actions against predecessors for consumer practices and arbitrations involving contract breaches and fee disputes
  3. 03MINORHigh royalty burden (3.5% combined: 2.5% sales + 1.0% receipts) on relatively thin margins (~7.2% net), limiting franchisee profitability
  4. 04MEDNo Item 19 (financial performance representations) disclosed, preventing independent verification of $506K average net income claim
  5. 05MINORArbitration history shows pattern of training quality and fee refund disputes, suggesting operational and contractual issues
  6. 06HIGHInvestment of $947K–$1.58M requires strong ROI justification given system contraction and litigation overhang

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.