Franchisel.com — FDD Diligence Memo
HARDEE'S (SLA)
Generated 2026-04-06 · 2024 FDD · Government-filed source
HARDEE'S (SLA)
2024 FDD Diligence Memo
Score of 44/10 driven by: low financial transparency.
Sys Health
6
Fin Strength
1
Contract
6
Change
0
Red Flags & Key Signals
Double-digit active lawsuits is unusual. Review whether franchisee-initiated cases dominate (signals system dissatisfaction) vs regulatory actions.
Auditors raised doubt about the franchisor's ability to continue as a going concern. This is a serious financial red flag — the franchisor may not be able to support the system.
Franchisor chose not to include a Financial Performance Representation. Item 19 is voluntary per FTC rules. This is not automatically a negative signal — it means economics cannot be scored from the disclosure.
Net unit loss of -5. Monitor whether this is a one-year anomaly or a trend.
You waive the right to sue in court. Arbitration typically favors the franchisor. Review the venue and arbitrator selection process.
After leaving the franchise, you cannot operate a competing business in this radius. Evaluate the real-world impact on your exit options.
Investment Overview
Items 5, 6, 7Total investment range: Not disclosed. Initial fee: $0. Royalty: —. Marketing fund: —.
Item 19 — Revenue
Item 19 — not included in filed FDD (voluntary per FTC Franchise Rule)Economics not rated — Item 19 not available.
Not DisclosedThis franchisor chose not to include a Financial Performance Representation. Item 19 is voluntary per FTC rules. This does not indicate bad economics — it means revenue projections cannot be sourced from the disclosure document.
Item 20 — System Health
Item 20 — 2024 FDDSystem flat — net -5 units in reporting period.
→ StableUnit count essentially unchanged.
Total Units
0
Net Growth
-5
Turnover
0%
Year-over-Year Trends
2024 FDDOpened
+0
Closed
-0
Net
-5
Prior-year Item 19 revenue data not available. Unit data above covers the reporting period in the 2024 FDD.
Key Contract Terms
Item 17Item 19 Data Quality Flags
Item 19No Item 19
This franchisor did not include a Financial Performance Representation in their FDD. Item 19 is voluntary per FTC rules — absence does not indicate poor economics.
Franchisee Interview Questions
Item 20 contactsUse Item 20 to get current franchisee contact info. Call at least 3-5. Ask these questions:
The franchisor's audited financials include a going-concern warning. Ask franchisees: have you heard anything about the franchisor's financial stability? Any changes to support or services recently?
Look for: Signs of reduced headquarters staffing, delayed tech updates, or reduced field support — early indicators of a financially stressed franchisor.
The agreement requires mandatory arbitration. Ask: have you ever had a dispute with the franchisor — how was it handled? Did you feel you had recourse?
Look for: Franchisees who've been through disputes. Understand if the arbitration process felt fair or heavily stacked toward the franchisor.
How responsive is your franchisor rep — do they actually help when you have a problem, or are they just checking boxes?
Look for: Specific stories (not just vague positives). Ask about a time they needed help urgently — response time matters.
If you decided to sell your franchise tomorrow, how easy would that be? Has the franchisor ever blocked or delayed a transfer you wanted?
Look for: Transfer fee surprises, right-of-first-refusal complications, or franchisor demanding upgrades before approving a sale.
What did your revenue look like in year 1 vs. year 2 vs. now? When did you reach breakeven?
Look for: Year 1 revenue is typically well below Item 19 averages (which often exclude ramp-up units). Expect 12-24 months to reach average.
What did the training actually cover vs. what you needed on day 1? What do you wish you'd learned before opening?
Look for: Gap between training content and operational reality. New franchisees often report the training covered theory but not real-world situations.
Data sources: 2024 Franchise Disclosure Document filed with a state franchise regulator (government record). Source: Extracted from 2024 FDD filed with MN CARDS (file #9790). Source: 9790-2024.pdf. · Payback estimates and margin assumptions are editorial — not from the FDD. This memo does not constitute legal or financial advice. Consult a franchise attorney and accountant before signing. Generated 2026-04-06 by Franchisel.com.