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B60/100FDD 2024

Smart Carpet Cleaning — Litigation & Risk

Cleaning - Commercial & Janitorial · 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
60 / 100
FranchiseVerdict composite
Rating
MODERATE
STRONG / MODERATE / CAUTION / AVOID

FDD Items 5, 6 & 17 — what you give up

Contract Risk Indicators

Mandatory arbitration
Not required
You retain the right to sue in court
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
Colorado
State whose law governs disputes — relevant if you're not based there

What drove the 60/100 rating

Risk Score Breakdown

  1. 01MINOROnly 2 units in system with unknown growth trajectory raises sustainability concerns
  2. 02MEDNet income not disclosed in Item 19 — cannot verify profitability claims against $508K average revenue
  3. 03MINORHigh initial investment ($111K-$178K) relative to tiny 2-unit franchise creates disproportionate risk
  4. 04MINORRoyalty floor of $300/month ($3,600/year) may be unsustainable for smaller locations or slow-growth territories
  5. 05MINORInsufficient franchisee pool (2 units) makes peer validation and support network assessment impossible
  6. 06MEDNo disclosed unit growth data suggests stalled expansion or undisclosed closures

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.