FranchiseVerdict
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D68/100FDD 2025

Do it Best — Litigation & Risk

Other · FDD Items 3, 4 & 5

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Moderate — Review

4 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
4
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
68 / 100
FranchiseVerdict composite
Rating
CAUTION
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
65
Government-backed loans issued
Default rate
17.8%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
8 loans
Loans charged off or defaulted
Total loan volume
$31.5M
Avg loan size
$485K
Participating lenders
30

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

Contract Risk Indicators

Mandatory arbitration
Not required
You retain the right to sue in court
Jury trial waiver
Not waived
Franchisor can compete
Yes
Franchisor can open competing locations in or near your territory
Right of first refusal
No
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 68/100 rating

Risk Score Breakdown

  1. 01MEDHigh investment range ($852.5K-$1.58M) with no disclosed average revenue or net income prevents ROI validation
  2. 02MINORDeclining unit growth (3.4% YoY) suggests market saturation or franchisee struggles in mature 4,053-unit system
  3. 03HIGHActive collection litigation indicates cash flow problems among franchisees and potential systemic profitability issues
  4. 04MINORUnprotected territory creates direct competition risk and cannibalization within franchise network
  5. 05MEDCritical data omissions: royalty rate unknown, franchise term unknown, no Item 19 financial performance data
  6. 06HIGHGoing Concern flag = false provides no clarity on whether FTC disclosure addressed franchisor financial stability

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.