Explanation

This specific risk was not identified in the FDD Package. Item 20 data does not show a pattern of rapid system expansion; rather, the number of franchised outlets has been stable or slightly declining. Rapid growth can strain a franchisor's ability to provide adequate support, so its absence here is notable. However, you should still monitor the franchisor's growth plans and support capacity.

Potential Mitigations

• A business advisor can help you assess if the franchisor's current support infrastructure is appropriately scaled for the existing system size.
• During due diligence calls, you should ask current franchisees about the quality and timeliness of the support they receive from the franchisor.
• Your accountant should review the franchisor's financial statements to ensure they are investing adequately in support systems for their current franchisees.

Explanation

This specific risk was not identified in the FDD Package. The executive profiles in Item 2 indicate that the key personnel, such as the CEO, have been with the company or its affiliates since 2015 or earlier. This suggests the management team has direct experience operating this specific business concept and franchise system. This continuity can be a positive factor for system stability and knowledge.

Potential Mitigations

• You should still ask current franchisees about their direct experiences with the management team's competence and support.
• A business advisor can help you research the professional backgrounds of the key executives listed in Item 2 for additional context.
• Your attorney can help you formulate questions to the franchisor about their long-term vision and strategic direction for the company.

Explanation

This specific risk was not identified in the FDD Package. Item 1 does not indicate that the franchisor is owned or controlled by a private equity firm. The management team appears to consist of the company's founders and long-term executives. This typically means that business decisions are less likely to be driven by short-term investor return timelines that can sometimes be associated with private equity ownership.

Potential Mitigations

• During due diligence, you can confirm the ownership structure with the franchisor.
• Your attorney can review the corporate documents to verify the ownership information presented in Item 1.
• A business advisor can help you understand the pros and cons of different franchisor ownership structures.

Explanation

This specific risk was not identified in the FDD Package. Item 1 clearly discloses the relationship with two key affiliates: BYWOOPS, LLC, which owns the trademarks, and FoodArt Bakery, LLC, which is a designated supplier. There is no indication of any other parent or controlling entity whose financial information might be missing. The franchisor appears transparent about its corporate structure.

Potential Mitigations

• Your attorney can confirm that the disclosed affiliate structure is complete and that no other entities exert control.
• An accountant's review of the disclosed financials for the franchisor and its affiliates is important to understand their interdependencies.
• You should ask the franchisor to explain the roles and interactions of each affiliate company.

Explanation

This specific risk was not identified in the FDD Package. Item 1 clearly states that the franchisor has no parent or predecessor company. Therefore, there is no hidden history of prior business failures, litigation, or high turnover under a different corporate name that you need to be concerned about. Your evaluation can focus solely on the history of WOOPS! FRANCHISE, LLC.

Potential Mitigations

• Your attorney can verify the franchisor's corporate history to confirm the absence of any predecessors.
• You can focus your due diligence efforts on the operating history disclosed in Items 3, 4, and 20 for the current franchisor entity.
• A business advisor can help you research the company's history through public records as an additional verification step.

Explanation

This specific risk was not identified in the FDD Package. Item 3 states, "No litigation is required to be disclosed in this Item." This indicates that the franchisor, its predecessors, and its management have not been involved in the types of legal disputes (such as fraud or franchise law violations) that must be reported. The absence of such litigation can be a positive sign about the franchisor's practices and relationship with franchisees.

Potential Mitigations

• Your attorney can perform an independent search for litigation involving the franchisor as a secondary check.
• During discussions with current and former franchisees, you can inquire about any legal disputes they may be aware of.
• A business advisor can help you understand what types of litigation are considered routine versus those that are red flags.