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Lifetime Green Coatings

Lifetime Green Coatings LLC
https://www.lifetimegreencoatings.com
1-877-660-4376
12415 Old Meridian Street, Carmel, Indiana 46032

Initial Investment Range

$127,500 to $518,250

Franchise Fee

$80,000 to $365,000

The franchise that we offer is for Lifetime Green Coatings, a business that provides eco-friendly industrial grade floor coatings for residential garages and commercial facilities.

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Lifetime Green Coatings April 3, 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.

1

Franchisor Stability Risks

Start Here
Total: 10
3
2
5

Disclosure of Franchisor's Financial Instability

High Risk

Explanation

The franchisor, Lifetime Green Coatings, LLC (LGC), is in a precarious financial state. The audited 2024 financial statements show a significant and growing members' deficit of over $1.2 million and negative working capital. While LGC showed a small net income in 2024, it suffered large losses in 2022 and 2023. This financial weakness, explicitly noted as a 'Special Risk' by the franchisor, questions its ability to support you or sustain operations.

Potential Mitigations

  • A thorough review of the franchisor's financial statements, including all footnotes, with an experienced franchise accountant is critical.
  • It is advisable to discuss the implications of the franchisor's negative equity and past losses with your financial advisor.
  • Your attorney should evaluate the 'Special Risk' disclosure regarding financial condition and its potential impact on your investment.
Citations: Item 21, Exhibit D, Special Risks to Consider About This Franchise

High Franchisee Turnover

High Risk

Explanation

The franchise system exhibits an exceptionally high rate of franchisee turnover. In 2024, Item 20 data shows that 16 of the 35 franchises existing at the start of the year were either terminated or ceased operations, representing a turnover rate of approximately 46%. This alarmingly high number is a critical red flag, suggesting potential systemic problems with the business model, profitability, or franchisor support, which could directly jeopardize your investment.

Potential Mitigations

  • Your business advisor should help you analyze the Item 20 tables to calculate the effective turnover rate over the last three years.
  • Contacting a significant number of former franchisees from the list in Exhibit G is essential to understand why they left the system.
  • Discussing the legal implications of such high turnover and potential system-wide issues with your franchise attorney is strongly recommended.
Citations: Item 20

Rapid System Growth

Medium Risk

Explanation

The system expanded from zero to 35 franchisees in 2023 and added another 19 in 2024. This extremely rapid growth, especially when paired with the franchisor's weak financial position and very high franchisee turnover, suggests its support infrastructure may be strained. You could face inadequate training, site selection assistance, or ongoing operational support as the franchisor struggles to keep pace, impacting your ability to launch and operate successfully.

Potential Mitigations

  • Your business advisor can help you question the franchisor about its specific plans to scale support systems to match franchisee growth.
  • In discussions with current franchisees, specifically inquire about the quality and responsiveness of the support they are currently receiving.
  • An accountant should analyze the franchisor's budget for franchisee support services in relation to its rapid expansion.
Citations: Items 11, 20, 21

New/Unproven Franchise System

High Risk

Explanation

LGC is a very new and unproven franchise system, having only begun franchising in 2021 and seeing its first franchisees open in 2023. The lack of a long-term operational track record is a significant risk. This is underscored by the company's weak financial state and the extremely high rate of franchisee failure disclosed in Item 20. Investing in such a young system carries a higher risk of business model flaws and potential system failure.

Potential Mitigations

  • A thorough investigation of the management team's prior experience in successfully operating a franchise system should be conducted with your business advisor.
  • It's prudent to create financial projections with your accountant using highly conservative assumptions due to the lack of a proven track record.
  • Your attorney might be able to negotiate more favorable contract terms to compensate for the elevated risk of investing in a new system.
Citations: Items 1, 2, 20, 21

Possible Fad Business

Low Risk

Explanation

This risk was not identified in the FDD package. The business model, which provides residential and commercial floor coatings, is part of the established home services industry. While market demands can change, the core offering does not appear to be a short-lived trend or fad, reducing the risk of a sudden collapse in consumer interest.

Potential Mitigations

  • Engage a business advisor to research the long-term market trends for home and commercial improvement services in your specific area.
  • Your accountant can help you analyze the business model's resilience against economic fluctuations.
  • Discussing the company's plans for future service innovation with the franchisor can provide insight into its long-term strategy.
Citations: Not applicable

Inexperienced Management

Medium Risk

Explanation

While the management team listed in Item 2 has some experience in other franchise ventures, the actual performance of this specific franchise system raises concerns. The combination of significant financial instability shown in Item 21 and the extremely high franchisee turnover rate detailed in Item 20 suggests that the management team may lack the specific experience required to successfully establish and support this franchise network, which poses a risk to your potential success.

Potential Mitigations

  • A business advisor should help you perform deep due diligence on the executives' specific roles and track records in their prior franchise engagements.
  • Questioning current franchisees about the quality and effectiveness of management's strategic direction and support is crucial.
  • Your attorney can help you assess whether the management team's disclosed experience aligns with the needs of this particular business.
Citations: Items 2, 20, 21

Private Equity Ownership

Low Risk

Explanation

This risk was not identified in the FDD package. Item 1 indicates the franchisor is a privately held LLC and does not suggest ownership by a private equity firm. This avoids the specific risks associated with PE ownership, such as a focus on short-term returns over the long-term health of the franchisee network.

Potential Mitigations

  • Your attorney should always verify the ownership structure detailed in Item 1 of the FDD.
  • Understanding the motivations and long-term goals of the ownership group, whoever they are, is a key due diligence step to perform with your business advisor.
  • An accountant can analyze the financial statements for signs of financial strategies often associated with different types of ownership.
Citations: Not applicable

Non-Disclosure of Parent Company

Low Risk

Explanation

This risk was not identified in the FDD package. The franchisor entity, Lifetime Green Coatings LLC, is clearly identified in Item 1, and there is no mention of a parent company that controls it. The financial statements provided are for the franchisor itself, giving a direct view of its financial health.

Potential Mitigations

  • Your attorney should confirm the corporate structure and ensure there are no undisclosed parent entities with controlling interests.
  • An accountant's review of the financial statement footnotes can help identify any guarantees or support from related entities that might imply a parent relationship.
  • If a franchisor is a subsidiary, a business advisor can help you evaluate the stability and commitment of the parent company.
Citations: Not applicable

Predecessor History Issues

Low Risk

Explanation

This risk was not identified in the FDD package. Item 1 explicitly states that the franchisor has no predecessors. This means you are evaluating the direct history of the current company without the complexity of uncovering potential inherited issues from a prior entity that operated the system.

Potential Mitigations

  • Your attorney should always confirm the accuracy of the predecessor disclosure in Item 1.
  • Even without predecessors, a business advisor can help you research the history of the key individuals in management listed in Item 2.
  • An accountant's review of the first available financial statements can offer insights into the company's formation and initial capitalization.
Citations: Not applicable

Pattern of Litigation

Low Risk

Explanation

This risk was not identified in the FDD package. Item 3 states that no litigation is required to be disclosed. This indicates a lack of significant legal disputes with franchisees, regulators, or other parties concerning fraud, contract violations, or other relevant claims, which can be a positive sign.

Potential Mitigations

  • Your attorney can conduct independent searches for litigation that may not have met the disclosure threshold but could still be relevant.
  • A business advisor can guide you in asking current and former franchisees about any informal disputes they may have had with the franchisor.
  • It is wise to have your attorney review the dispute resolution clauses in the Franchise Agreement to understand the process if a conflict does arise.
Citations: Not applicable
2

Disclosure & Representation Risks

Total: 15
7
1
7

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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3

Financial & Fee Risks

Total: 10
4
5
1

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.

4

Legal & Contract Risks

Total: 16
9
3
4

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.

5

Territory & Competition Risks

Total: 5
2
1
2

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.

6

Regulatory & Compliance Risks

Total: 10
6
0
4

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.

7

Franchisor Support Risks

Total: 4
2
2
0

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.

8

Operational Control Risks

Total: 12
4
4
4

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.

9

Term & Exit Risks

Total: 18
11
5
2

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.

10

Miscellaneous Risks

Total: 2
1
1
0

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.