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B58/100FDD 2026

The Tailored Closet® — Litigation & Risk

Business Services - Printing & Signs · FDD Items 3, 4 & 5

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Moderate — Review

1 case disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
1
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
58 / 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
1
Government-backed loans issued
Default rate
0.0%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
0 loans
Loans charged off or defaulted

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

What drove the 58/100 rating

Risk Score Breakdown

  1. 01MEDUnit count declined 5.6% YoY (136 units), indicating system contraction and potential market saturation
  2. 02MEDNet income not disclosed in Item 19 — unable to assess actual profitability despite $506,934 average revenue
  3. 03MINORParent company (Aussie Pet Mobile) had 2006 Maryland Securities Division Consent Order for franchise disclosure violations — raises compliance culture concerns
  4. 04MINORRoyalty structure floor of $500/mo (yr 1) and $1,000/mo (thereafter) represents 11.8%-23.6% of monthly revenue for lower-performing franchises
  5. 05MINORHigh franchise fee ($19,950) relative to 10-year term and declining unit base suggests franchisor dependent on recruitment rather than franchisee success
  6. 06MINORNo Item 19 financial performance disclosure prevents validation of average revenue claims and benchmarking against actual franchisee results

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.