The franchisor has initiated 8 lawsuits against franchisees or other parties—what are the nature and outcomes of these cases, and are there any ongoing disputes affecting current franchisee operations?
#1
Two cases are currently pending—what are the details of these pending litigations, when do you expect resolution, and could they impact franchise operations or support?
#2
Your franchise fee of $73,000 and royalty rate of 8.0% are both above industry standards for home services—how are these higher fees justified relative to franchisee returns and support provided?
#3
The non-compete clause extends 100 miles from the former location for 2 years—what is the business rationale for this unusually broad geographic restriction compared to industry norms of 25-40 miles?
#4
Territory is marked as protected but not exclusive with no encroachment protection—what does 'protected' specifically mean operationally, and can the franchisor place other Next Day Access units within my territory?
#5
Your system grew 78.6% in the past year (22 net new units)—how are you managing franchisee support, training, and quality control during this rapid expansion phase?
#6
What were the specific reasons for the 2 unit closures/non-renewals in 2024, and are there any patterns or common factors among the 5 total exits since 2022?
#7
Financial data shows average sales of $1.38 million but median sales of $737,438—what explains this wide dispersion, and what sales levels are achievable in different market conditions or territories?
#8
The franchise agreement contains 20 non-curable defaults resulting in immediate termination without notice—can you provide the complete list of these defaults, and has this termination clause been enforced against franchisees?
#9
Personal guarantees are required from all shareholders, members, and their spouses with unlimited liability—what recourse do franchisees have if they believe the guarantee terms are inequitable or if circumstances change?
#10
You have zero terminations recorded and a 7.1% non-renewal rate—are departing franchisees required to sell their business back to the franchisor, or can they sell to qualified third parties without franchisor approval?
#11
The $10,000 renewal fee is charged every 10 years—are there any other material changes to terms, fees, or conditions when a franchise renews that franchisees should anticipate?
#12
With 50 total units currently, how many franchisees are profitable, and what is the average payback period for initial investment across your system?
#13
The support and training score of 73 is below industry standards—what specific initial training, ongoing support, and field support services are included, and are there additional costs?
#14
Given the 2 pending litigation cases and 8 prior franchisor-initiated suits, are there any claims or disputes that could result in material changes to franchise operations or financial performance?
#15
The franchise agreement mentions a post-term non-compete restriction within a 75-mile radius—how does this coordinate with the 2-year 100-mile non-compete, and which restriction applies in what circumstances?
#16
Are franchisees required to purchase products, services, or technology from designated suppliers, and what percentage of gross revenue typically goes to franchisor-controlled revenue sources?
#17
The system's Item 19 shows significant sales variation by territory—what demographic, market, or geographic factors most strongly correlate with the performance of top-quartile vs. bottom-quartile franchisees?
#18