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Mosquito Hunters
How much does Mosquito Hunters cost?
Initial Investment Range
$141,295 to $170,743
Franchise Fee
$107,000
The franchise offered is for the right to operate a "PEST HUNTERS-MOSQUITO HUNTERS-HUMBUG HOLIDAY LIGHTING" business, which specializes in (1) pest control services under the PEST HUNTERS-MOSQUITO HUNTERS trademarks offering a distinctive solution for the eradication of a wide range of pests, including mosquitoes, fleas, ticks, ants, spiders, rodents, cockroaches, and other pests, through a regular spraying system and maintenance program for residential and commercial application.
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Mosquito Hunters May 8, 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
Medium Risk
Explanation
The financial statements for the parent company, LD Parent, Inc., which guarantees performance, show significant assets are in goodwill and other intangibles. The company is also highly leveraged with substantial long-term debt and related party notes, resulting in significant interest expense. While profitable with growing revenue, this capital structure, common with private equity ownership, could create financial pressure on the system, potentially affecting resources available for franchisee support and brand development.
Potential Mitigations
- A thorough review of the parent company's audited financial statements, including all footnotes, with your accountant is essential to assess its financial stability.
- Discuss the implications of the company's high debt and intangible asset levels on long-term support and brand investment with your financial advisor.
- It is advisable to ask your attorney about the strength and enforceability of the parent company's guarantee of performance.
High Franchisee Turnover
High Risk
Explanation
The data in Item 20 indicates a notable rate of franchisee terminations in recent years. For the full year 2022, the termination rate was approximately 13.4% of the outlets operating at the start of the year, and in 2023 it was approximately 8.9%. Such a pattern of franchisees leaving the system through termination could suggest potential underlying issues with the business model, franchisee profitability, or the franchisor-franchisee relationship that warrant further investigation.
Potential Mitigations
- It is critical to contact a significant number of former franchisees listed in Item 20, especially those who were terminated, to understand their experiences.
- Your business advisor can help you analyze the turnover rates in the context of the industry and system size.
- In discussions with the franchisor, you should inquire about the reasons for this level of franchisee terminations, with questions prepared by your attorney.
Rapid System Growth
Medium Risk
Explanation
The franchise system has shown a recent increase in the number of outlets after a few years of slight contraction. While growth can be positive, it's important to verify that the franchisor's support infrastructure, as outlined in Item 11, is scaling appropriately to provide adequate training and ongoing assistance to all new and existing franchisees. Rapid expansion can sometimes strain a franchisor's resources, potentially impacting the quality of support you receive.
Potential Mitigations
- Your business advisor can help you question the franchisor about their specific plans for scaling support, training, and operational staff to match unit growth.
- Contacting a mix of new and established franchisees from the list in Item 20 can provide insight into the current quality and responsiveness of franchisor support.
- An accountant should review the franchisor's financial statements to assess if they appear to have the capital to adequately support this growth phase.
New/Unproven Franchise System
Low Risk
Explanation
This risk was not identified in the FDD package. The franchisor and its predecessor have been in operation since 2013 and franchising since 2015, indicating it is not a new or unproven system. Evaluating a system's track record is important because new franchisors may lack refined support systems, brand recognition, and a history of franchisee success, which can increase your investment risk.
Potential Mitigations
- When evaluating any franchise, it's wise to have your business advisor assess the franchisor's operational history and the maturity of its systems.
- An attorney can help you understand any additional risks associated with a newer or less established franchise concept.
- Reviewing the business experience of the management team in Item 2 with your business advisor is a key step in assessing any franchise.
Possible Fad Business
Low Risk
Explanation
This risk was not identified in the FDD package. The business operates in the pest control and holiday lighting industries, which are established service sectors with ongoing consumer demand. A fad business, based on a temporary trend, presents a significant risk because customer interest may disappear, leaving you with a worthless business and ongoing contractual obligations to the franchisor.
Potential Mitigations
- A business advisor can help you research the long-term market demand and historical resilience of any industry you consider entering.
- It is useful to evaluate a franchisor's plans for innovation and adaptation to stay relevant in a changing market.
- When analyzing any opportunity, your financial advisor can help assess the sustainability of the business model beyond current trends.
Inexperienced Management
Low Risk
Explanation
This risk was not identified in the FDD package. The management team detailed in Item 2 appears to have considerable experience with the franchisor and its affiliated companies within the home services industry. Inexperienced management can be a risk because it may lead to inadequate support, poor strategic decisions, and underdeveloped operational systems, which could jeopardize your investment.
Potential Mitigations
- It is always a good practice to have your business advisor help you vet the backgrounds of the key executives listed in Item 2.
- Contacting existing franchisees provides valuable, real-world feedback on the quality and effectiveness of management's support.
- Your attorney can help you ask targeted questions about the management team's experience in both the specific industry and in franchising.
Private Equity Ownership
High Risk
Explanation
Item 1 discloses affiliations with CNL Strategic Capital and Levine Leichtman Capital Partners, which indicates private equity involvement. This ownership structure can present risks, as decisions may prioritize short-term returns for investors. This could potentially influence policies regarding fees, support funding, and pressure on franchisees. The highly leveraged balance sheet disclosed in Item 21 is also a common characteristic of such ownership structures.
Potential Mitigations
- Your business advisor should help you research the private equity firm's reputation and its track record with other franchise systems.
- It is crucial to speak with current franchisees about any changes in system philosophy, support levels, or fees since the PE firm's involvement began.
- An attorney can help you understand the franchisor's right to sell the system and what that could mean for your franchise agreement.
Non-Disclosure of Parent Company
Low Risk
Explanation
This risk was not identified in the FDD package. The franchisor's parent company, LD Parent, Inc., is disclosed in Item 1, and its audited financial statements are provided in Item 21. Failure to disclose a parent company or provide its financial statements when required can obscure the true financial health and control structure of a franchise system, which is a significant risk for a prospective franchisee.
Potential Mitigations
- Engaging an attorney to verify the franchisor's corporate structure is a prudent step in due diligence.
- An accountant should always confirm that the financial statements provided are for the correct entity and meet all disclosure requirements.
- If a parent company guarantee is offered, your attorney should review it to ensure it provides meaningful protection.
Predecessor History Issues
Low Risk
Explanation
This risk was not identified in the FDD package. The franchisor discloses its predecessor in Item 1 but does not report any negative history, such as litigation or bankruptcy, associated with that entity in Items 3 and 4. A franchisor's history, including that of its predecessors, can provide important insights into the stability and potential challenges of the franchise system.
Potential Mitigations
- Your attorney should always review the disclosures in Items 1, 3, and 4 for any information related to predecessors.
- When a system has been acquired, asking long-term franchisees about their experiences under previous ownership can be insightful.
- A business advisor can assist you in conducting independent research on a predecessor's historical track record.
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. A pattern of litigation, particularly claims of fraud or breach of contract brought by franchisees, can be a major warning sign of systemic problems within a franchise. Conversely, a high number of lawsuits initiated by the franchisor against its franchisees might suggest an unusually aggressive or litigious culture.
Potential Mitigations
- Having an attorney review Item 3 is a critical step to understand the franchisor's litigation history.
- It is wise to ask current and former franchisees about the nature of disputes within the system.
- Your attorney can help you conduct public record searches for litigation that may not have been required to be disclosed in the FDD.
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
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
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
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
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
Purchase the complete risk review to see all 102 risks across all 10 categories.
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
Purchase the complete risk review to see all 102 risks across all 10 categories.
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.
