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B59/100FDD 2025

SHUBH® Beauty — Litigation & Risk

Personal Services - Beauty & Salon · FDD Items 3, 4 & 5

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Moderate — Review

3 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
3
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
59 / 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
Yes
Franchisor can match any purchase offer when you try to sell
Governing law
Illinois
State whose law governs disputes — relevant if you're not based there

What drove the 59/100 rating

Risk Score Breakdown

  1. 01HIGHGoing Concern status is FALSE — indicates potential financial instability at franchisor level
  2. 02MINORNo average revenue or net income disclosure (no Item 19) — impossible to validate ROI claims or profitability benchmarks
  3. 03HIGHSignificant litigation history including $900,000 settlement in 2024 — suggests operational or contractual disputes with franchisees
  4. 04MINORNo protected territory — direct competition risk from other SHUBH franchisees or franchisor-opened locations
  5. 05MEDHigh royalty burden ($1,000/month = $12,000 annually) relative to investment size without disclosed earnings data
  6. 06MEDModest unit growth (17.3% YoY) with only 122 total units — limited scale and network effects; growth may not be sustainable

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.