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Stand Strong Fencing

HPB Fencing LLC
https://www.standstrongfencing.com
1-800-490-8991
2525 N. 117 Avenue, Third Floor, Omaha, NE 68164

How much does Stand Strong Fencing cost?

Initial Investment Range

$160,181 to $416,071

Franchise Fee

$85,185 to $220,185

We offer qualified individuals the right to operate a business which specializes in the sale and installation of wood, steel, aluminum, and vinyl fencing and related products for residential and commercial customers under the “Stand Strong Fencing” mark.

Enjoy our partial free risk analysis below

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Stand Strong Fencing April 29, 2025 FDD Risk Analysis

Free FDD Library AI Analysis Date: August 22, 2025

DISCLAIMER: Not Legal Advice - For Informational Purposes Only. Consult With Qualified Franchise Professionals.

1

Franchisor Stability Risks

Start Here
Total: 10
5
2
3

Disclosure of Franchisor's Financial Instability

High Risk

Explanation

The franchisor's 2024 audited financials reveal significant risks. HPB Fencing LLC (the Franchisor) reports a net loss of $869,074 and a negative members' deficit of ($537,460). A footnote explicitly states the company has recurring losses and requires funds from its majority member to meet liquidity needs through May 2026. This financial weakness, also flagged as a 'Special Risk' by the franchisor, questions its ability to support you and fulfill its obligations.

Potential Mitigations

  • A franchise accountant must perform a deep analysis of the financial statements, including the 'going concern' language and reliance on related-party funding.
  • Discuss the franchisor's specific plans to achieve profitability and its parent company's commitment to funding with your business advisor.
  • Your attorney should investigate if any states have required a bond or escrow account due to these financial weaknesses.
Citations: Item 21, Exhibit E (Financial Statements)

High Franchisee Turnover

High Risk

Explanation

While Item 20 tables show explosive growth from 10 to 126 outlets in 2024 with zero terminations, a separate list in Exhibit I shows one franchisee with five territories was terminated during that same period. This direct contradiction in reported data raises questions about the accuracy and transparency of the disclosures regarding franchisee turnover. Such inconsistencies may obscure the true rate of franchisee distress or failure within the system.

Potential Mitigations

  • Your attorney must question the franchisor directly about this discrepancy between Item 20 and Exhibit I to get a clear, written explanation.
  • Speaking with the terminated franchisee listed in Exhibit I is critical to understanding the reasons for their exit, which a business advisor can help facilitate.
  • An accountant should help you model the potential financial impact if the underlying franchisee success rate is lower than the main tables suggest.
Citations: Item 20, Exhibit I

Rapid System Growth

High Risk

Explanation

The franchisor is experiencing explosive growth, expanding from 10 to 126 outlets in a single year (2024). While growth can be positive, such a rapid expansion rate can severely strain a young franchisor's resources. This may compromise its ability to provide the promised levels of training, site selection assistance, marketing, and ongoing operational support to all new franchisees, potentially leading to widespread system issues and inadequate guidance for your business.

Potential Mitigations

  • A business advisor should help you assess whether the franchisor's support infrastructure, detailed in Item 11, seems adequate for this level of growth.
  • It is imperative to ask a broad range of new and established franchisees about the quality and timeliness of the support they are currently receiving.
  • Your attorney can help you question the franchisor about their specific plans to scale their support team and systems to match this rapid expansion.
Citations: Item 20

New/Unproven Franchise System

High Risk

Explanation

The franchisor, HPB Fencing LLC, was formed in May 2023 and only began franchising in June 2023. It also has negative net worth and significant operating losses. As a new system with a limited operating history and precarious financial condition, this represents a higher level of risk. The business model is not yet proven at scale, and the franchisor's ability to provide long-term support and build brand value is uncertain.

Potential Mitigations

  • Your accountant must scrutinize the financials to assess capitalization and the plan for future profitability.
  • A business advisor should help you perform extensive due diligence on the management team's experience in both franchising and the fencing industry.
  • Given the higher risk, your attorney could attempt to negotiate more franchisee-favorable terms, such as enhanced support guarantees or reduced fees.
Citations: Items 1, 2, 21

Possible Fad Business

Low Risk

Explanation

This risk was not identified in the FDD package. A fad business is one tied to a fleeting trend, lacking long-term consumer demand. Investing in such a concept is risky because your contractual obligations, which last for 10 years, will likely outlive the public's interest, potentially leading to business failure. Evaluating the long-term market relevance of a product or service is a crucial part of due diligence.

Potential Mitigations

  • A business advisor can help you conduct independent market research to assess the long-term demand and sustainability of the core business offering.
  • Analyze the franchisor's commitment to research and development in Item 11 to gauge their plans for innovation and adaptation.
  • Speaking with an accountant about the business model's resilience to economic shifts and changing consumer tastes is a prudent step.
Citations: Item 1, Item 11

Inexperienced Management

Medium Risk

Explanation

The management team detailed in Item 2 holds numerous, often simultaneous, executive roles across a large portfolio of affiliated franchise brands under the 'Horsepower Brands' umbrella. While the individuals may have franchising experience, their attention is divided among many different, often young, systems. This lack of a dedicated, focused leadership team for Stand Strong Fencing could result in diluted support, slow decision-making, and a strategy that may not be optimized for this specific brand.

Potential Mitigations

  • A business advisor can help you question the franchisor about the specific time and resources the key executives dedicate solely to this brand.
  • When speaking with existing franchisees, inquire specifically about their access to and the responsiveness of senior leadership.
  • Assess with your attorney whether the management structure presents an unacceptable risk to the support you expect to receive.
Citations: Items 1, 2

Private Equity Ownership

Low Risk

Explanation

This risk was not identified in the FDD package. Private equity ownership can introduce risks, as the firm's primary goal may be maximizing short-term returns for its investors, which can sometimes conflict with the long-term health of the franchisees. This might manifest as increased fees, reduced support to cut costs, or a quick sale of the franchise system, creating uncertainty for your investment.

Potential Mitigations

  • Researching a private equity owner's history with other franchise systems they have owned can provide valuable insight; a business advisor can assist with this.
  • Your attorney should review the Franchise Agreement for any clauses that give the franchisor a broad right to sell or assign the system.
  • Discuss any concerns about the ownership structure with existing franchisees to gauge their experience since any acquisition.
Citations: Item 1

Non-Disclosure of Parent Company

Low Risk

Explanation

This risk was not identified in the FDD package. A franchisor might be a subsidiary of a larger parent company. If the FDD does not disclose the parent company or provide its financial statements when required (e.g., if the parent guarantees the franchisor's performance), you may lack a complete picture of the financial strength and resources backing your franchise. This is especially risky if the franchisor entity itself is newly formed or thinly capitalized.

Potential Mitigations

  • Your attorney should verify the complete corporate structure and identify any parent companies.
  • If a parent entity exists and provides guarantees, an accountant should review its financial statements for stability.
  • Understanding the full ownership structure is key to assessing the real financial backing of the franchisor, a task your business advisor can help with.
Citations: Items 1, 21, 22

Predecessor History Issues

Medium Risk

Explanation

The franchisor discloses that it acquired the assets of a predecessor, Stand Strong, Inc., in June 2023. This predecessor was founded by Eli Orenstein, who is also the founder-operator of the flagship franchisee outlet presented in the Item 19 FPR. While the FDD provides this basic information, the full operational and financial history of the predecessor is not detailed, which could obscure past challenges or performance issues that might be relevant to your investment decision.

Potential Mitigations

  • A business advisor can help you investigate the history and reputation of the predecessor company, Stand Strong, Inc.
  • When speaking with franchisees, especially any who may have been affiliated with the predecessor, inquire about their experiences before the acquisition.
  • Your attorney can help you ask the franchisor for more details about the transition and any inherited liabilities or ongoing issues.
Citations: Item 1

Pattern of Litigation

High Risk

Explanation

Item 3 discloses two recent, pending lawsuits filed by franchisees against the franchisor's affiliates and parent company management. The allegations are severe, including fraudulent misrepresentation, fraud in the inducement, and deceptive trade practices. Although not filed directly against HPB Fencing LLC, the cases involve the same overarching management group. This pattern of litigation raises significant red flags about the integrity of the sales process and the representations made by the organization.

Potential Mitigations

  • A franchise attorney must carefully review the specifics of the litigation disclosed in Item 3 and explain the potential implications for you.
  • Consider asking your attorney to research the public court records for these cases to get more detailed information beyond the FDD summary.
  • It is crucial to discuss these lawsuits with the franchisor and, if possible, a broad range of existing franchisees.
Citations: Item 3
2

Disclosure & Representation Risks

Total: 15
5
3
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

Unlock Full Risk Analysis

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3

Financial & Fee Risks

Total: 10
4
6
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.

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
3
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.

6

Regulatory & Compliance Risks

Total: 10
4
1
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

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
5
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.

9

Term & Exit Risks

Total: 18
8
7
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
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.