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A53/100FDD 2025

Sugaring LA — Litigation & Risk

Personal Services - Beauty & Salon · 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
53 / 100
FranchiseVerdict composite
Rating
STRONG
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
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
Michigan
State whose law governs disputes — relevant if you're not based there

What drove the 53/100 rating

Risk Score Breakdown

  1. 01MINOROnly 8 units system-wide with unknown/stagnant growth trajectory raises scalability concerns
  2. 02MINORHigh investment-to-net-income ratio: $313k-$431k investment against $131k avg net income means 2.4-3.3 year payback with no growth buffer
  3. 03MINOR6% royalty on $617k average revenue ($37k annually) is substantial given modest profitability margins (~21% net)
  4. 04MINORSmall unit count limits franchisee referral networks and brand recognition leverage
  5. 05HIGHNo disclosed litigation is positive, but tiny franchise size means less public scrutiny/disclosure requirements

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.