Pet Wants Logo

Pet Wants

Pet Wants Franchise System, LLC
https://www.petwants.com
1-513-999-9925
4755 Lake Forest Drive, Suite 100, Cincinnati, Ohio 45242

Initial Investment Range

$137,850 to $219,000

Franchise Fee

$63,500 to $73,500

A Pet Wants franchise sells pet food and supplies and pet grooming services at a retail location and offers home delivery services.

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Pet Wants April 9, 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
2
3
5

Disclosure of Franchisor's Financial Instability

Medium Risk

Explanation

Pet Wants Franchise System, LLC's (Pet Wants) financials in Exhibit K show low Members' Equity ($286,630) relative to over $4 million in revenue for 2024. In 2023, the company distributed nearly three times its net income to members. While currently profitable, this pattern of extracting cash rather than retaining significant earnings could suggest a risk to the company's long-term financial resilience and ability to reinvest in the system, potentially impacting its capacity to support you.

Potential Mitigations

  • Your accountant should perform a detailed analysis of the franchisor's financial statements, focusing on trends in equity, cash flow, and distribution policies.
  • A business advisor can help you assess if the franchisor's financial health is sufficient to support its stated growth plans and support obligations.
  • Discuss the company's capitalization and reinvestment strategy directly with the franchisor's management team for greater clarity.
Citations: Item 21, Exhibit K

High Franchisee Turnover

High Risk

Explanation

Item 20 data reveals a significant rate of franchisee attrition, which appears to be disguised. In the last three years, 31 units were 'Reacquired by Franchisor'. A footnote to Table 4 clarifies these were terminations. This represents an effective turnover rate of over 11% in 2023 and 7.5% in 2024. Such high, non-transparent turnover is a critical red flag, suggesting potential systemic issues with franchisee profitability, satisfaction, or the business model itself.

Potential Mitigations

  • It is crucial to have your franchise attorney analyze the Item 20 tables and explain the implications of the high 'reacquisition' numbers.
  • Contacting a significant number of former franchisees from the list in Exhibit M is essential to understand why they left the system.
  • Your accountant should use this turnover data to factor a higher level of risk into your financial projections.
Citations: Item 20, Table 3, Table 4

Rapid System Growth

Low Risk

Explanation

This risk was not identified in the FDD Package. The system has shown steady, but not explosive, growth over the past three years. Rapid expansion can be a risk because a franchisor's support systems, such as training and field support, might not keep pace with the number of new franchisees. This can lead to diluted brand standards and inadequate assistance for individual owners.

Potential Mitigations

  • Engage a business advisor to evaluate if the franchisor's support infrastructure, as described in Item 11, seems adequate for its current size and growth rate.
  • Speaking with franchisees who joined at different times can provide insight into whether support quality has remained consistent during growth.
  • Your accountant can review the franchisor's financial statements to assess if they are investing profits back into support infrastructure.
Citations: Item 20, Table 1

New/Unproven Franchise System

Medium Risk

Explanation

The franchisor entity, Pet Wants, was formed in 2015 and has never operated a franchise itself. While an affiliate has operated similar locations, this separation means the franchisor lacks direct, hands-on experience running the exact business model you will operate. Additionally, key leadership, including the President and VP of Franchise Development, are very new to their roles as of early 2025. This combination introduces risk regarding the franchisor's operational expertise and management stability.

Potential Mitigations

  • A business advisor can help you assess the potential impact of the management team's recent appointments and their specific franchising experience.
  • It is vital to speak with current franchisees about the quality and effectiveness of the operational support and training they actually receive.
  • Your attorney should review the franchisor's obligations in Item 11 to determine if they are specific and enforceable or largely discretionary.
Citations: Item 1, Item 2

Possible Fad Business

Low Risk

Explanation

This risk was not identified in the FDD Package. The pet food and supply industry is a large, established market with consistent consumer demand, not typically considered a fad. A fad business is one based on a short-lived trend, which poses a significant risk because your long-term contractual obligations continue even if public interest disappears, potentially leading to business failure.

Potential Mitigations

  • A business advisor can help you research long-term market trends for the pet supply industry to confirm its stability.
  • Investigating the business models of direct competitors can offer insights into the sustainability of this specific market segment.
  • Your financial advisor can help you model different economic scenarios to test the resilience of the business.
Citations: Item 1

Inexperienced Management

Medium Risk

Explanation

Several key executives, including the President and VP of Franchise Development, have only been in their roles with Pet Wants since early 2025. While they may have experience with affiliated brands or other industries, their very recent placement in these top positions specific to the Pet Wants system could create a risk of strategic instability or a learning curve that may affect the quality of leadership and support you receive as a new franchisee.

Potential Mitigations

  • Careful questioning of the franchisor about the reasons for the recent management changes is warranted; your attorney can help guide this discussion.
  • Engaging with current franchisees to gauge their confidence in the new leadership team and the direction of the company is advisable.
  • A business advisor can help you evaluate the collective experience of the entire management team as presented in Item 2.
Citations: Item 2

Private Equity Ownership

Low Risk

Explanation

This risk was not identified in the FDD Package, as Item 1 indicates the parent company is Franchise Funding Group, LLC, not a private equity firm. Private equity ownership can be a risk because PE firms often have a shorter investment horizon. This can lead to decisions that prioritize quick returns for investors, such as cutting franchisee support or increasing fees, over the long-term health of the brand.

Potential Mitigations

  • It is wise to have your attorney investigate the ownership structure of any franchisor to identify if it is controlled by a private equity firm.
  • If a PE firm is involved, a business advisor can help you research the firm's history with other franchise brands.
  • Speaking with franchisees who have been through a PE acquisition can provide invaluable insight into how operations might change.
Citations: Not applicable

Non-Disclosure of Parent Company

Low Risk

Explanation

This risk was not identified in the FDD Package. Pet Wants does disclose its parent company, Franchise Funding Group, LLC, in Item 1. Furthermore, the audited financial statements for Pet Wants are provided in Exhibit K. When a franchisor is a subsidiary, the parent's financial health can be crucial, and failure to disclose it when required can hide significant risks about the overall stability and backing of the franchise system.

Potential Mitigations

  • Your attorney should always verify that the FDD properly discloses any parent companies as required by Item 1.
  • If a parent company exists and guarantees the franchisor's performance, an accountant should review the parent's financial statements.
  • A business advisor can help investigate the relationship and power dynamics between a franchisor and its parent.
Citations: Item 1, Item 21, Exhibit K

Predecessor History Issues

Low Risk

Explanation

This risk was not identified in the FDD Package. Item 1 states that Pet Wants does not have any predecessors. When a franchisor has predecessors, it's important to understand that history, as it can reveal inherited issues, past litigation, or high franchisee failure rates under a previous owner. Inadequate disclosure of a predecessor's history can prevent you from seeing the full picture of the system's past challenges.

Potential Mitigations

  • Have your attorney review Item 1 carefully to confirm whether any predecessors exist.
  • If a predecessor is disclosed, it is prudent to have your attorney examine any associated litigation or bankruptcy history in Items 3 and 4.
  • A business advisor can help you research a predecessor's public reputation and track record.
Citations: Item 1

Pattern of Litigation

High Risk

Explanation

Item 3 discloses multiple regulatory enforcement actions against Pet Wants and its affiliates for failure to disclose material facts in prior FDDs, specifically the personal bankruptcies of officers. The company and its affiliates entered into settlement and consent orders with regulators in Virginia and California. This pattern of disclosure violations across the affiliated franchise group represents a significant risk, suggesting potential issues with the franchisor's compliance culture and transparency, which could affect the reliability of this FDD.

Potential Mitigations

  • Your franchise attorney must carefully review all litigation and regulatory actions disclosed in Item 3.
  • This history of disclosure violations warrants heightened skepticism and more intensive due diligence on all other aspects of the FDD.
  • A discussion with your attorney is crucial to understand the potential implications of these past regulatory issues on your relationship with the franchisor.
Citations: Item 3
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
3
4
3

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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4

Legal & Contract Risks

Total: 16
6
6
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
0
4
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.

6

Regulatory & Compliance Risks

Total: 10
5
2
3

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
3
7
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.

9

Term & Exit Risks

Total: 18
9
6
3

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.