B67/100FDD 2025
Money Mailer — Litigation & Risk
Business Services - Other · FDD Items 3, 4 & 5
Moderate — Review
1 case disclosed in FDD Items 3 and 4.
Source: FDD Items 3–5
FDD Items 3 & 4
Litigation Metrics
Cases disclosed
1
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
67 / 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
49
Government-backed loans issued
Default rate
14.9%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
7 loans
Loans charged off or defaulted
Total loan volume
$5.3M
Avg loan size
$108K
Participating lenders
36
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
Missouri
State whose law governs disputes — relevant if you're not based there
What drove the 67/100 rating
Risk Score Breakdown
- 01MINORSystem declining sharply: -18.8% unit contraction YoY (131 units) indicates franchisee dissatisfaction or market saturation
- 02HIGHGoing Concern status is FALSE — suggests financial viability questions at corporate level
- 03HIGHLitigation history: $1M+ breach of contract dispute in 2021-2022 with fraud/deceit counterclaims raises franchisor-franchisee relationship concerns
- 04MINORNo territory protection — direct competition from other Money Mailer franchisees in same zone; capped royalty ($350/zone) suggests thin margins
- 05MINORNet income of $179K on $686K revenue (26% margin) may not justify $64.6K initial investment + ongoing royalties, especially in declining market
- 06MINORItem 19 (Financial Performance Representation) not provided — cannot validate average revenue/income claims or franchisee profitability distribution
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.