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B66/100FDD 2025

JAN-PRO Commercial Cleaning — Litigation & Risk

Cleaning - Commercial & Janitorial · FDD Items 3, 4 & 5

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Moderate — Review

5 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
5
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
66 / 100
FranchiseVerdict composite
Rating
MODERATE
STRONG / MODERATE / CAUTION / AVOID

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
No
Franchisor can match any purchase offer when you try to sell
Governing law
California
State whose law governs disputes — relevant if you're not based there

What drove the 66/100 rating

Risk Score Breakdown

  1. 01HIGHMajor litigation history: $30M settlement for employee misclassification claims (2004-2023) indicates systemic labor law compliance issues that may persist
  2. 02MEDNo average net income disclosed despite 153 units operating — opacity on profitability is a major red flag for a $3.2K-$57.7K investment model
  3. 03MINORUnprotected territory creates direct competition risk; franchisees can cannibalize each other's revenue in the same geographic area
  4. 04MINORLow franchise fee ($1,025) combined with 11% royalty suggests franchisor relies heavily on volume/royalties rather than upfront fees, indicating potential pressure to recruit over franchisee success
  5. 05MINORModest unit growth (11.7% YoY on small base of 153) and lack of Item 19 financial data raise questions about system sustainability and franchisee satisfaction
  6. 06MINOR5-year term is short; franchisees may face renewal uncertainty and pressure to accept unfavorable terms
  7. 07MINORAverage revenue of $29,167 is extremely low; unclear if this is monthly or annual, but if annual, ROI on even the minimum $3,224 investment is concerning

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.