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How much does Granite Garage Floors cost?
Initial Investment Range
$227,367 to $390,367
Franchise Fee
$107,367 to $107,867
We offer franchises that sell, market and install residential garage floor coating systems under the Granite Garage Floors names and logo and any other marks we may license to you.
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Granite Garage Floors April 29, 2025 FDD Risk Analysis
Free FDD Library AI Analysis Date: July 16, 2025
DISCLAIMER: Not Legal Advice - For Informational Purposes Only. Consult With Qualified Franchise Professionals.
Franchisor Stability Risks
Start HereDisclosure of Franchisor's Financial Instability
High Risk
Explanation
The franchisor's parent guarantor, HS Group Holding Company, LLC (HSGH), shows significant, recurring financial weakness. Audited financial statements reveal a consolidated net loss of over $13 million in 2024 and over $10 million in 2023. This financial instability, also noted as a “Special Risk” by the franchisor, questions the guarantor's ability to provide meaningful support or ensure the long-term health of the franchise system, despite providing a performance guarantee.
Potential Mitigations
- Your accountant must conduct a thorough review of the parent company's audited financial statements, paying close attention to the large operating losses and negative working capital.
- It is crucial to discuss with a financial advisor the potential impact of the guarantor's financial weakness on its ability to support your business long-term.
- Ask your franchise attorney about the practical value and enforceability of a performance guarantee from a company with a history of significant losses.
High Franchisee Turnover
Low Risk
Explanation
This specific risk was not identified in the FDD package. An analysis of Item 20 data does not indicate a high rate of franchisee terminations, non-renewals, or other cessations of business. High turnover can be a significant red flag for systemic problems, such as lack of profitability or poor franchisor support. It is important to analyze this data over a three-year period to spot negative trends that could affect your investment.
Potential Mitigations
- Speaking with a significant number of former franchisees listed in Item 20 is a critical due diligence step your business advisor can help you prepare for.
- An accountant can help you analyze the turnover data presented in Item 20 to calculate the churn rate and compare it to industry averages.
- Your attorney should help you formulate questions for the franchisor regarding any franchisee departures to understand the underlying reasons.
Rapid System Growth
Medium Risk
Explanation
The franchise system expanded rapidly, growing from 14 to 44 outlets in 2023. While growth can be positive, such a rapid increase can strain a franchisor's resources. This is particularly concerning given the parent guarantor's history of significant financial losses, which may limit its ability to scale up training, marketing, and operational support infrastructure to adequately serve a much larger system. This could potentially dilute the quality of support available to you.
Potential Mitigations
- In discussions with your business advisor, you should question the franchisor about their specific plans to scale support systems to match the rapid unit growth.
- Contacting franchisees who joined during the recent growth spurt can provide insight into the current quality and responsiveness of franchisor support.
- Your accountant should review the franchisor's financials to assess whether they appear to have the capital to adequately support this expansion.
New/Unproven Franchise System
Low Risk
Explanation
This risk was not identified in the FDD. Granite Garage Floors Franchising, LLC (GGF) began franchising in 2013 and had 55 operating franchises at the end of 2024, indicating it is an established system. Investing in a new or unproven franchise system carries higher risks, as the business model, brand recognition, and support systems may not be fully developed or validated in the marketplace, potentially leading to a higher failure rate.
Potential Mitigations
- When evaluating a newer system, it's wise to have a business advisor help you scrutinize the industry and franchising experience of the management team.
- For an unproven concept, consulting an accountant to assess the franchisor's capitalization and financial stability is essential.
- Your attorney can help you negotiate more franchisee-favorable terms to offset the higher risks associated with a new system.
Possible Fad Business
Low Risk
Explanation
This risk does not appear to be present. The business of installing epoxy garage floor coatings is a well-established category within the home improvement industry. While demand may be tied to the broader economy and housing market, the service itself is not based on a short-term trend or fad. A fad business carries the risk that consumer interest will disappear, leaving you with a worthless investment even though your contractual obligations remain.
Potential Mitigations
- A business advisor can help you conduct independent market research to assess the long-term consumer demand for any franchise's products or services.
- Asking an attorney to review the franchise agreement term against the potential lifespan of a trendy product is a prudent step.
- A financial advisor can help you evaluate the business's resilience to economic shifts and changing consumer tastes.
Inexperienced Management
Low Risk
Explanation
This risk was not identified. FDD Item 2 indicates that the franchisor's management team is composed of individuals with prior experience in franchising and at other established companies. Inexperienced management can be a significant risk, as it may lead to underdeveloped operational systems, inadequate franchisee support, and poor strategic decisions that could jeopardize the entire franchise network and your investment within it.
Potential Mitigations
- With any franchisor, it is important to have your business advisor help you vet the backgrounds of the key executives listed in Item 2.
- Speaking with existing franchisees is a key way to gauge their confidence in the current management team's capabilities and vision.
- An attorney can help you understand the contractual commitments for support, which can be especially important with a less experienced team.
Private Equity Ownership
Medium Risk
Explanation
The franchisor is ultimately owned by funds managed by The Riverside Company, a private equity firm. This ownership structure may create a focus on maximizing short-term profitability and a quick exit strategy, which might not always align with the long-term health of the franchisees. Decisions on fees, support levels, and system-wide changes could be driven by investor returns rather than franchisee success. The potential for the system to be sold introduces uncertainty about future ownership.
Potential Mitigations
- It is beneficial to have your business advisor research the private equity firm's reputation and track record with other franchise systems.
- Speaking with franchisees about any changes in culture, support, or fees since the private equity acquisition can provide valuable insights.
- Your attorney should review the assignment clause in the Franchise Agreement to understand your rights if the system is sold.
Non-Disclosure of Parent Company
Low Risk
Explanation
This risk is not present. FDD Item 1 clearly discloses the parent company, Threshold Brands, LLC, and the ultimate parent holding company, HS Group Holding Company, LLC. Furthermore, the FDD includes the audited financial statements of the parent guarantor. A failure to disclose a parent company, or to provide its financials when it guarantees performance, can hide significant risks related to the true financial backing and stability of the franchisor.
Potential Mitigations
- Your attorney should always verify the corporate structure disclosed in Item 1 to ensure all parent and affiliate relationships are clear.
- If a parent company guarantee is provided, an accountant should confirm that the parent's financial statements are included and properly audited.
- Understanding the legal and financial relationship between a franchisor and its parent is a key due diligence step for your attorney.
Predecessor History Issues
Low Risk
Explanation
Item 1 discloses a predecessor entity, The Garage Floor Coating Company, LLC, which was the original owner of some trademarks. The FDD states this entity never sold franchises. Because the predecessor history appears straightforward and doesn't involve prior franchising activity with associated litigation or failures, the risk is considered low. A problematic predecessor history, however, can obscure past system failures or inherited issues that could affect new franchisees.
Potential Mitigations
- It is wise to have your attorney carefully review all disclosures regarding predecessor entities in Items 1, 3, and 4.
- If a franchisor acquired a system from a predecessor, your business advisor can assist in researching the predecessor's public track record.
- Asking long-tenured franchisees about their experiences under any previous ownership can provide important historical context.
Pattern of Litigation
Low Risk
Explanation
This risk was not identified, as FDD Item 3 states that no litigation information is required to be disclosed. A pattern of litigation, particularly lawsuits initiated by franchisees alleging fraud or misrepresentation, can be a major red flag. It may indicate systemic problems in the franchisor's sales process, support obligations, or overall business practices. A high volume of lawsuits initiated by the franchisor against franchisees can also suggest an overly aggressive or difficult relationship.
Potential Mitigations
- An attorney should always be engaged to carefully review the nature, frequency, and outcomes of any lawsuits disclosed in Item 3.
- Even with no disclosed litigation, speaking with former franchisees can sometimes reveal past disputes that did not result in lawsuits.
- Your attorney can conduct public record searches to see if any litigation exists that was not required to be disclosed.
Disclosure & Representation Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
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Financial & Fee Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
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Legal & Contract Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
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Territory & Competition Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
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Regulatory & Compliance Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Franchisor Support Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
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Operational Control Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Term & Exit Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Miscellaneous Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.