Smartstyle
Bottom line
- Total investment $184K – $336K including a $40K franchise fee.
- No Item 19 financial performance data disclosed — the franchisor chose not to publish revenue figures.
- Rated MODERATE with a risk score of 64/100. SBA loan default rate of 0.0% across 104 loans (below the industry average).
- 16 litigation matters disclosed in Item 3 — higher than typical. Review the summary for patterns (franchisor-initiated vs. franchisee-initiated).
Item 1 · who you're contracting with
The Franchisor
Yale framework · single-unit ROIC
Returns Analysis
Pulls Item 7 (investment) and Item 19 (revenue) from this brand's FDD into the Yale unlevered-ROIC formula. Override any input to stress-test it against your own assumptions.
The model · Yale framework
What would one Smartstyle unit return on the cash you put in?
Unlevered ROIC · per unit
57%
In Yale's "attractive" band (30–60%)
Overview
About
Smartstyle franchisees operate hair salons within Walmart stores, providing haircut, color, and styling services to retail customers. Daily operations include staff scheduling, inventory management, customer service, and compliance with Walmart operating requirements while paying escalating royalties to the franchisor.
Item 7 · what it costs
The Vitals
Item 19
Financial Performance
This franchisor did not disclose financial performance representations in Item 19, or our extractor could not parse them.
Item 20 · unit dynamics
The Growth Chart
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 22 states with active franchisees
The Territory Map
Derived from franchisee contact records. Shows states with at least one current operator — not where the franchisor is registered to sell new units (that data is re-extracting in a future refresh).
States derived from franchisee phone area codes (Item 20). Approximate — ported numbers may show the original state, not the franchisee's current location.
Government records
SBA Loan Data
Aggregated from SBA 7(a) loan disclosures, public data unique to FranchiseVerdict.
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Smartstyle presents HIGH RISK due to accelerating unit decline (-15.4% YoY), extensive litigation alleging franchisor misconduct, missing financial disclosure, and an increasingly-burdened royalty structure targeting a declining franchisee base.
Score breakdown · what drove the 64 / 100 rating
- 01MEDSystem contracting sharply with 15.4% YoY unit decline (911 units) indicating franchisee exits and market deterioration
- 02MEDNo disclosed average revenue or net income data (missing Item 19) prevents realistic ROI assessment and suggests franchisor may be hiding poor unit-level economics
- 03HIGHSignificant litigation portfolio including fraud, misrepresentation, and breach of contract allegations against franchisor, plus regulatory violations across multiple states
- 04MINOREscalating royalty structure (4% Year 1 vs. 5% thereafter, with $100/week minimum) compounds unit economics pressure on already-declining franchisees
- 05MINORUnprotected territory creates direct competition risk within same market and justifies zero territorial defensibility
- 06MEDHigh initial investment ($184K-$336K) paired with 5-year term offers limited exit flexibility if unit underperforms relative to contracting system
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
Item 11
Training & Operations
Item 20
Franchisee Contacts
Phone numbers extracted directly from this brand's FDD Item 20. After purchase, you'll also receive a list of validation questions tailored to this brand.
Franchisee contacts
100 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Smartstyle · FDD (2025) PDF