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B61/100FDD 2025

Slumberland — Litigation & Risk

Home Services - Other · FDD Items 3, 4 & 5

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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
61 / 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
20
Government-backed loans issued
Default rate
7.1%
vs <3% typical · system-wide
5-yr default rate
0.0%
Defaults
1 loans
Loans charged off or defaulted
Total loan volume
$7.1M
Avg loan size
$356K
Participating lenders
14

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
Minnesota
State whose law governs disputes — relevant if you're not based there

What drove the 61/100 rating

Risk Score Breakdown

  1. 01MINORStagnant unit growth at 1.4% YoY indicates mature/declining system with minimal expansion
  2. 02MEDNet income not disclosed in Item 19 prevents ROI validation and profitability assessment
  3. 03MEDHigh investment range ($829.5K-$3.2M) with no disclosed average net income creates unclear payback period
  4. 04MINORRoyalty structure tied to 3% of gross revenues offers no cost relief during downturns and incentivizes top-line over profitability
  5. 05MED15-year term locks franchisees into long commitment with limited exit flexibility in declining category
  6. 06MINORFurniture retail sector faces structural headwinds from e-commerce and DTC competition (Wayfair, Amazon, DTC brands)

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.