B65/100FDD 2025
Kwik Kar — Litigation & Risk
Automotive - Repair & Service · FDD Items 3, 4 & 5
Lower Risk
No litigation cases disclosed in FDD Items 3 and 4.
Source: FDD Items 3–5
FDD Items 3 & 4
Litigation Metrics
Cases disclosed
0
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
65 / 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
68
Government-backed loans issued
Default rate
9.8%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
6 loans
Loans charged off or defaulted
Total loan volume
$51.7M
Avg loan size
$761K
Participating lenders
25
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
3 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
Colorado
State whose law governs disputes — relevant if you're not based there
What drove the 65/100 rating
Risk Score Breakdown
- 01MINOROnly 26 units with unknown/stagnant growth trajectory raises questions about system viability and market demand
- 02HIGHNo Item 19 financial performance representation (Going Concern = False) means franchisor provides no earnings claims or benchmarking data
- 03MINORUnprotected territory creates direct competition risk; franchisees could face cannibalization from other company-owned or franchised locations
- 04MINORWide investment range ($291K-$1.97M) suggests inconsistent unit economics or unclear build-out requirements
- 05MED6% royalty on $1.04M average revenue ($62.5K annually) combined with $309K net income leaves limited margin for underperforming units
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.