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A38/100FDD 2026

McAlister’s Deli — Litigation & Risk

Food & Beverage - Full Service · 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
38 / 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
65
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
2 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
Georgia
State whose law governs disputes — relevant if you're not based there

What drove the 38/100 rating

Risk Score Breakdown

  1. 01MEDMinimal unit growth (1.7% YoY) suggests mature/stagnant system with limited expansion momentum
  2. 02MINORNo Item 19 (Net Income) disclosure prevents ROI validation against $910K-$2.5M investment range
  3. 03MINORHigh franchise fee ($35,500) plus 5% royalty creates 6%+ blended fee burden with no profitability benchmark
  4. 04HIGHParent company (Sardar Investments/Arby's ecosystem) litigation history includes no-poaching and data breach settlements indicating compliance/operational risks
  5. 05MINOR572-unit system is mid-sized and vulnerable; scale insufficient to absorb economic downturns like larger competitors

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.