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Waffle Cabin

Atomium, Inc.
https://www.wafflecabin.com
1-802-775-0058
18 Night Pasture Lane, South Chittenden, Vermont 05701
FDD Version:

How much does Waffle Cabin cost?

Initial Investment Range

$90,250 to $239,950

Franchise Fee

$36,588 to $56,298

The franchise is for a restaurant or mobile trailer offering quick-serve Belgian sugar waffles and beverages such as coffee, tea and hot cocoa operating under the name “Waffle Cabin” using the franchisor’s proprietary recipes, formulae, techniques, trade dress, trademarks and logos.

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Waffle Cabin June 19, 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
1
5
4

Disclosure of Franchisor's Financial Instability

High Risk

Explanation

The franchisor’s 2024 income statement shows a significant drop in net income compared to 2023. Additionally, over 52% of the franchisor’s total revenue comes from selling goods and equipment to you, rather than from royalties. This reliance on sales to franchisees instead of system-wide sales to the public may indicate a less stable financial model, potentially impacting the franchisor's ability to support you long-term.

Potential Mitigations

  • A franchise accountant should thoroughly analyze the financial statements, including revenue sources and profitability trends over the past three years.
  • It is wise to ask the franchisor to explain the significant decrease in net income and their high dependency on franchisee purchases.
  • Your business advisor can help assess if the franchisor's financial condition is strong enough to provide ongoing support and system growth.
Citations: Item 21, Exhibit A

High Franchisee Turnover

Medium Risk

Explanation

Item 20 data for 2024 shows two franchise terminations. While the overall turnover rate is not alarmingly high, any instance of franchisees leaving the system involuntarily warrants investigation. Understanding the reasons behind these terminations can provide insight into potential challenges within the franchise relationship or business model. There was also one ceased operation in 2022.

Potential Mitigations

  • Discussing the circumstances surrounding the terminations with the franchisor can provide important context.
  • Contacting former franchisees listed in Item 20 to understand their experiences is a crucial due diligence step your attorney can guide.
  • An accountant can help you analyze the turnover data across all categories (terminations, non-renewals, ceased operations) over the three-year period for a clearer picture.
Citations: Item 20

Rapid System Growth

Medium Risk

Explanation

The franchise system has experienced steady growth, expanding from 45 to 57 total outlets in two years. However, this growth coincides with a notable decrease in the franchisor's net income in the most recent fiscal year. Such a combination could suggest that resources are being stretched thin, potentially impacting the quality and availability of franchisee support, training, and operational guidance as the system scales.

Potential Mitigations

  • It would be prudent to ask the franchisor about their plans to scale support infrastructure to match the rate of unit growth.
  • Engaging with a range of existing franchisees, both new and established, can provide perspective on the current quality of franchisor support.
  • A discussion with your business advisor can help evaluate if the franchisor's staffing and resources are adequate for its size.
Citations: Item 20, Item 21

New/Unproven Franchise System

Medium Risk

Explanation

While the franchisor's affiliate has operated since 1998, the franchisor itself began in 2012. The system is not brand new, but it is also not a large, nationally established brand. The significant drop in net income shown in the most recent financial statements raises questions about the long-term stability and profitability of the current franchising model, which presents a moderate risk for a prospective franchisee.

Potential Mitigations

  • Your business advisor should help you perform thorough due diligence on the brand's market position and the experience of its management team.
  • Speaking with franchisees who have been in the system for several years can offer insights into its evolution and stability.
  • An accountant's review of the complete financial statements is essential to assess the franchisor's financial health.
Citations: Item 1, Item 2, Item 21

Possible Fad Business

Medium Risk

Explanation

The Waffle Cabin business model is heavily concentrated in seasonal locations, particularly ski resorts, as shown in the Item 19 financial performance data. This business focus creates a potential risk of dependency on tourism trends, weather conditions, and the stability of third-party venue operators. A downturn in the ski industry or loss of access to a key resort location could significantly impact revenue and profitability.

Potential Mitigations

  • A business advisor can help you research the long-term viability of the niche, seasonal food-service market.
  • You should carefully evaluate the terms of any agreements with venue operators, like ski resorts, with the help of your attorney.
  • Developing a business plan with your accountant that accounts for seasonal fluctuations and potential off-season revenue streams is critical.
Citations: Item 1, Item 12, Item 19

Inexperienced Management

Low Risk

Explanation

The key executive, Peter Creyf, has extensive experience in this specific business, having been involved with the affiliate company's operations since 1998. This long tenure suggests a deep understanding of the industry and the operational model. Therefore, the risk associated with inexperienced management appears to be low in this case.

Potential Mitigations

  • It is still a good practice to discuss the management team's vision and strategic plans for the franchise with them directly.
  • Engaging with current franchisees to confirm their satisfaction with management's leadership and support is a valuable due diligence step.
  • Your business advisor can help you assess the overall strength and depth of the franchisor's leadership team.
Citations: Item 2

Private Equity Ownership

Low Risk

Explanation

This risk was not identified in the FDD Package. Private equity ownership can sometimes lead to a focus on short-term profits over the long-term health of the franchise system. This might manifest as reduced franchisee support, increased fees, or pressure to use specific vendors to maximize investor returns.

Potential Mitigations

  • During your due diligence, asking the franchisor about their ownership structure and long-term goals is a prudent step.
  • Your attorney can help you investigate the ownership history of the franchisor to identify any private equity involvement.
  • A business advisor can help you research the reputation of any private equity firm involved with a franchise.
Citations: Not applicable

Non-Disclosure of Parent Company

Medium Risk

Explanation

An affiliate, Leo's Inc., owns the trademarks and is a key supplier, but its financial statements are not provided in Item 21. While not always required, the absence of this information creates a potential risk. Without seeing the financials of the entity that controls the brand's core intellectual property and is a major supplier, you have an incomplete picture of the overall financial stability of the entities you depend on.

Potential Mitigations

  • Your attorney should inquire why the affiliate's financial statements are not included, especially given its critical role.
  • It is important to understand the terms of the license agreement between the franchisor and its affiliate, which your attorney can review.
  • An accountant can help you assess the potential risks arising from this two-company structure.
Citations: Item 1, Item 8, Item 13, Item 21

Predecessor History Issues

Low Risk

Explanation

This risk was not identified in the FDD Package. Franchisors must disclose information about predecessors, which are previous entities that operated or sold the franchise. Reviewing the history of predecessors, including any litigation or bankruptcy, is important because it can reveal inherited problems or a pattern of past failures within the system that could affect your investment.

Potential Mitigations

  • A careful review of Item 1 of the FDD with your attorney will help identify if any predecessors exist.
  • If predecessors are disclosed, your attorney can help you research their business and legal history for any red flags.
  • Asking long-term franchisees about their experiences under any previous ownership can provide valuable insight.
Citations: Not applicable

Pattern of Litigation

Low Risk

Explanation

This risk was not identified in the FDD Package, as no litigation was disclosed in Item 3. A pattern of lawsuits filed by franchisees against the franchisor alleging fraud, misrepresentation, or breach of contract can be a significant red flag. It may indicate systemic problems with the franchisor's sales practices, support obligations, or overall business model.

Potential Mitigations

  • It is crucial to have your attorney carefully review Item 3 for any disclosed litigation.
  • If litigation is present, your attorney can help you obtain and review the actual court filings for detailed information.
  • Contacting franchisees involved in past or present litigation can provide direct insight into the nature of the disputes.
Citations: Not applicable
2

Disclosure & Representation Risks

Total: 15
5
1
9

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
2
4
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.

4

Legal & Contract Risks

Total: 16
6
5
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.

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

Purchase the complete risk review to see all 102 risks across all 10 categories.

6

Regulatory & Compliance Risks

Total: 10
4
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

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.

7

Franchisor Support Risks

Total: 4
0
3
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.

8

Operational Control Risks

Total: 12
3
3
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

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.

9

Term & Exit Risks

Total: 18
7
8
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.