Pink Zebra Moving Logo

Pink Zebra Moving

Pink Zebra Moving, LLC
https://www.pinkzebrafranchise.com
1-205-203-4881
505 20th Street North, Suite 1010, Birmingham, Alabama 35203

Initial Investment Range

$131,031.93 to $388,682.25

Franchise Fee

$65,860.00 to $135,000

We are offering franchises for the operation of a local moving business under our name Pink Zebra Moving® in designated territories with a focus on professional moving and packing services.

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Pink Zebra Moving April 28, 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
5
0
5

Disclosure of Franchisor's Financial Instability

High Risk

Explanation

The franchisor's audited financial statements in Item 21 reveal significant financial weakness. For the year ending December 31, 2024, Pink Zebra Moving, LLC (PZM) reported a net loss of over $337,000 and a members' deficit (negative net worth) of over $906,000. This financial instability, confirmed by state-mandated fee deferrals, could impact PZM's ability to provide support or fulfill its obligations, posing a significant risk to your investment.

Potential Mitigations

  • Your accountant must conduct a thorough review of the franchisor's financial statements, including the notes, to assess its solvency and dependency on new franchise sales.
  • Engage your franchise attorney to understand the protections offered by any state-mandated financial assurances, such as fee deferrals.
  • Discuss the franchisor's plans for achieving profitability and financial stability with your business advisor and the franchisor directly.
Citations: Item 21, Exhibit A (Financial Statements), Exhibit O (State Specific Addenda for IL, MD, VA, WA)

High Franchisee Turnover

High Risk

Explanation

Item 20 data reveals a high rate of franchisee exits in 2024. Out of a total of 18 franchises that operated at some point during the year, 5 (about 28%) either ceased operations or were reacquired by the franchisor. Such a high turnover rate is a significant red flag that may indicate systemic problems, potential franchisee unprofitability, or other challenges within the system. This poses a direct risk to the long-term viability of your potential investment.

Potential Mitigations

  • A business advisor should help you analyze the turnover statistics in Item 20 and compare them against any available industry benchmarks.
  • It is critical to contact a significant number of former franchisees listed in Exhibit C to understand their reasons for leaving the system.
  • Your franchise attorney can help you formulate specific questions for the franchisor regarding the high rate of ceased operations.
Citations: Item 20 (Tables 2 and 3), Exhibit C

Rapid System Growth

High Risk

Explanation

Item 20 data shows the system grew from 2 to 13 franchised units in just two years. While growth can be positive, such rapid expansion for a young company can strain resources. Coupled with the financial weaknesses noted in Item 21, this creates a risk that the franchisor may be unable to provide adequate training and ongoing support to all its new franchisees, including you.

Potential Mitigations

  • In discussions with the franchisor, inquire specifically about how they are scaling their support staff and systems to manage this rapid growth.
  • Contacting both new and established franchisees from the list in Exhibit B is essential to gauge the current quality and responsiveness of franchisor support.
  • Your business advisor can help assess whether the franchisor's support infrastructure appears robust enough for its current and projected size.
Citations: Item 20, Item 21

New/Unproven Franchise System

High Risk

Explanation

Pink Zebra Moving is a very new franchise system, having only begun offering franchises in April 2022. As a new franchisor, its business model, brand recognition, and franchisee support systems are likely not as established or proven as those of more mature systems. This inherently carries a higher risk, as the long-term viability and profitability of the franchise concept have not yet been demonstrated over time.

Potential Mitigations

  • A thorough investigation into the business and franchising experience of the management team in Item 2 is critical; a business advisor can assist with this.
  • You should speak with the earliest franchisees on the list in Exhibit B to understand the challenges they faced in a new system.
  • Your accountant should scrutinize the franchisor's capitalization to assess its ability to fund operations while the system matures.
Citations: Item 1, Item 20

Possible Fad Business

Low Risk

Explanation

This risk was not identified. The moving and packing industry is a well-established service sector and is not considered a business trend or fad. The long-term demand for moving services is generally tied to broader economic factors like real estate activity rather than fleeting consumer interests. A business tied to a fad carries the risk of declining demand after the trend passes.

Potential Mitigations

  • When evaluating any franchise, it is wise to have a business advisor help you research the long-term market demand for its products or services.
  • Assessing a company's plans for innovation and adaptation can help determine its potential for longevity.
  • Your financial advisor can help you consider a business's resilience to economic cycles and changing consumer tastes.
Citations: Not applicable

Inexperienced Management

Low Risk

Explanation

This risk was not identified, as the management team detailed in Item 2 appears to have significant prior experience in franchising. The founder and several key executives have previous leadership roles at another franchise system. Inexperienced management can be a risk because it may lead to weak support systems, poor strategic decisions, and a lack of understanding of the franchisee-franchisor relationship.

Potential Mitigations

  • When evaluating a franchise, it is important to have your business advisor help you vet the background of the key management team.
  • Speaking with current franchisees can provide insight into the effectiveness and competence of the leadership team.
  • A review of Item 2 in the FDD should be a key part of your due diligence process.
Citations: Not applicable

Private Equity Ownership

Low Risk

Explanation

This risk was not identified in the FDD. Item 1 indicates the franchisor is an Alabama Limited Liability Company and does not disclose ownership by a private equity firm. When a PE firm owns a franchisor, there can be a risk that decisions are prioritized for short-term investor returns, potentially at the expense of long-term franchisee success.

Potential Mitigations

  • Understanding the ownership structure of the franchisor, as detailed in Item 1, is a crucial step in due diligence.
  • A business advisor can help research the track record of any parent company or private equity owner.
  • When PE ownership exists, it is wise to ask current franchisees about any changes in support or system direction since the acquisition.
Citations: Not applicable

Non-Disclosure of Parent Company

Low Risk

Explanation

This risk was not identified. The FDD explicitly states in Item 1 that the franchisor has no parent company. Failing to disclose a parent company can be a risk if the franchisor is a thinly capitalized subsidiary, as it may obscure the true financial backing and stability of the entity you are contracting with.

Potential Mitigations

  • Your franchise attorney should always verify the corporate structure disclosed in Item 1.
  • If a parent company does exist and provides guarantees, your accountant should ensure the parent's financial statements are provided and reviewed.
  • Clarifying the relationships between all entities involved in the franchise system is a key part of legal due diligence.
Citations: Not applicable

Predecessor History Issues

Low Risk

Explanation

This risk is not applicable as the franchisor states in Item 1 that it has no predecessors. In cases where a franchisor has acquired a system from a predecessor, it is important to scrutinize the predecessor's history for issues like litigation, bankruptcy, or high franchisee turnover, as these could indicate underlying problems with the business model that may have been inherited.

Potential Mitigations

  • Your attorney should confirm the accuracy of the disclosures in Item 1 regarding predecessors.
  • If a predecessor exists, researching its history for red flags is an important due diligence step.
  • Speaking with long-term franchisees who operated under a predecessor can provide valuable historical context.
Citations: Not applicable

Pattern of Litigation

High Risk

Explanation

Item 3 and the financial statement notes disclose several disputes between the franchisor and its franchisees. This includes two mediation filings initiated by the franchisor and a letter of complaint from three other franchisees. For a very young system with only 13 active outlets at year-end 2024, this volume of conflict is a significant red flag. It may suggest potential issues in the franchise relationship, operational disagreements, or an aggressive enforcement stance by the franchisor.

Potential Mitigations

  • A franchise attorney should carefully review the details of the disclosed litigation and disputes.
  • It is critical to contact the franchisees involved in these disputes, if possible, to understand the nature of the disagreements.
  • Given the level of conflict, discussing the franchisor's approach to dispute resolution with your attorney is highly advisable.
Citations: Item 3, Exhibit A (Note 8 to Financial Statements)
2

Disclosure & Representation Risks

Total: 15
6
4
5

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: 14
8
3
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

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4

Legal & Contract Risks

Total: 19
7
6
6

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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5

Territory & Competition Risks

Total: 5
4
0
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

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6

Regulatory & Compliance Risks

Total: 10
6
2
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

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7

Franchisor Support Risks

Total: 4
1
2
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

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8

Operational Control Risks

Total: 13
8
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.

9

Term & Exit Risks

Total: 15
11
4
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

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10

Miscellaneous Risks

Total: 2
2
0
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.