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How much does Vicious Biscuit cost?
Initial Investment Range
$799,000 to $1,317,000
Franchise Fee
$65,000 to $85,000
The franchisee will operate a "Vicious Biscuit" business providing a "True Southern Dining Experience" featuring chef-inspired, craft-food driven, fork-and-knife biscuit dishes, brunch plates, healthy alternatives, and a selection of craft cocktails and non-alcoholic drinks.
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Vicious Biscuit April 3, 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.
Franchisor Stability Risks
Start HereDisclosure of Franchisor's Financial Instability
High Risk
Explanation
The franchisor, Vicious Biscuit Franchising, LLC (Vicious Biscuit), is in a precarious financial position. The audited financial statements in Exhibit G show significant and increasing net losses, a substantial negative net worth (members' deficit of -$593,062), and negative cash flow from operations. The FDD also explicitly flags “Financial Condition” as a special risk, questioning the ability to provide support. This financial weakness poses a significant risk to the franchisor's long-term viability and its capacity to support you.
Potential Mitigations
- Your accountant must conduct a thorough analysis of the franchisor's financial statements, including all footnotes and cash flow statements.
- Discuss with a business advisor the potential impacts on support and brand growth if the franchisor continues to experience losses.
- Your attorney should advise on the protections, if any, afforded by state-mandated financial assurances, such as the one mentioned in the Maryland Addendum.
High Franchisee Turnover
Low Risk
Explanation
This specific risk was not identified in the FDD Package. The franchise system is very new, with the first two franchised outlets opening in 2024. Therefore, there is no history of franchisee turnover to analyze yet. While this means no negative trend is present, it also means there is no track record of franchisee success or stability within the system. You should monitor future FDDs for this data.
Potential Mitigations
- Your business advisor should help you perform extensive due diligence by speaking with the first few operating franchisees about their experiences.
- An accountant can help you project a worst-case financial scenario, as there is no franchisee performance history to rely on.
- It is important to have your attorney review the termination and renewal clauses, as the reasons for future turnover are defined there.
Rapid System Growth
Low Risk
Explanation
This risk was not identified. The data in Item 20 shows that the system is in its infancy, with only two franchised outlets opening in the most recent year. The growth is not rapid, which mitigates the risk that the franchisor's support systems could be overwhelmed. However, you should still carefully assess their capacity to support future growth.
Potential Mitigations
- During your due diligence calls, ask existing franchisees about the quality and timeliness of the support they currently receive.
- A business advisor can help you assess the franchisor's staffing and infrastructure relative to its growth plans.
- Have your attorney review the franchisor's contractual support obligations to understand what you are entitled to receive.
New/Unproven Franchise System
High Risk
Explanation
This risk is clearly present. Vicious Biscuit explicitly discloses a "Short Operating History" as a special risk. Item 20 confirms that franchising began in 2022 and only two franchised units were operational by the end of 2024. This lack of a track record, combined with the weak financial condition disclosed in Item 21, suggests the business model is unproven in the franchise context, which significantly increases your investment risk.
Potential Mitigations
- A franchise attorney should be consulted to potentially negotiate more favorable terms to offset the heightened risk of joining a new system.
- Engaging a business advisor is critical for conducting deep due diligence on the concept's viability and management's capabilities.
- Your accountant must help you create conservative financial projections, as there is little franchisee performance data available.
Possible Fad Business
Medium Risk
Explanation
The business concept, focused on chef-inspired, fork-and-knife biscuit dishes, is a niche within the competitive brunch and fast-casual dining sector. While unique, its long-term mass-market appeal and resilience to changing consumer tastes are unproven. There is a potential risk that the concept could be a trend with limited staying power, which could impact your business's sustainability over the 10-year franchise term.
Potential Mitigations
- A business advisor can help you conduct independent market research to assess the long-term consumer demand for this specific niche concept.
- Discuss the franchisor's plans for menu innovation and concept evolution with them to understand how they plan to stay relevant.
- Analyzing the competitive landscape with your business advisor is crucial to determine if the concept has a durable advantage.
Inexperienced Management
Low Risk
Explanation
This risk was not identified. Item 2 indicates that the key executives have relevant experience in the restaurant industry. For example, the CEO has led the operating company since 2018, and the VP of Operations has prior experience as a director with a major national franchise, Chick-fil-A. While the franchising entity itself is new, the management team does not appear to lack pertinent industry experience.
Potential Mitigations
- It is still wise to discuss the management team's specific franchising expertise with a business advisor.
- Asking current franchisees about their direct experiences with the management team's support and guidance is a valuable due diligence step.
- Your attorney can help you verify the backgrounds of key personnel through publicly available information.
Private Equity Ownership
Low Risk
Explanation
This risk was not identified in the FDD. Item 1 indicates that the franchisor is owned by its founders and other related LLCs, not by a private equity firm. Therefore, the specific risks associated with PE ownership, such as a focus on short-term returns over long-term brand health, do not appear to be present here.
Potential Mitigations
- It is good practice to have your attorney confirm the ownership structure and identify all controlling parties.
- A business advisor can help you research the background of the actual owners to understand their business philosophy and track record.
- Always ask the franchisor about any potential plans to sell the company in the future.
Non-Disclosure of Parent Company
Low Risk
Explanation
This risk was not identified. Item 1 discloses the franchisor and its various affiliated companies, such as those holding intellectual property or providing management services. There is no indication of a hidden or undisclosed parent company whose financials or influence would be material to your investment decision.
Potential Mitigations
- Your attorney can help you diagram the relationship between all affiliated entities mentioned in Item 1 to fully understand the corporate structure.
- An accountant should review any financial transactions between the franchisor and its affiliates, as detailed in the financial statement footnotes.
- Clarifying the specific roles and responsibilities of each affiliate with the franchisor is a key due diligence step.
Predecessor History Issues
Low Risk
Explanation
This risk was not identified. Item 1 of the FDD does not list any predecessors to Vicious Biscuit Franchising, LLC. The operating company has been in business since 2017, but the franchisor entity itself is new. There is no indication of a prior entity's negative history being concealed or transferred to the new franchisor.
Potential Mitigations
- A business advisor can still help you research the history of the brand and its founding company to look for any relevant background information.
- Ask the franchisor directly about the history of the brand and the transition from company operations to franchising.
- Your attorney can conduct public record searches to confirm the corporate history provided.
Pattern of Litigation
Medium Risk
Explanation
Item 3 discloses litigation against the franchisor's CEO, Mr. McLaughlin, related to a prior, unaffiliated business. The lawsuit, brought by a bankruptcy trustee, included allegations of fraudulent transfer and was settled for $45,000. While this does not constitute a pattern of litigation against the franchisor itself, the involvement of a key principal in litigation with such serious allegations presents a reputational and character risk that you should consider.
Potential Mitigations
- You should discuss the nature and potential implications of this litigation with your attorney.
- Consider this information when evaluating the character and integrity of the franchisor's management team, perhaps with input from a business advisor.
- Ask the franchisor if they can provide any additional context regarding this settled case.
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
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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
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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
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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
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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
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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
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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
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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