Buyer Guide
Arby's Franchise Cost: Investment, Revenue & SBA Data
Quick answer
Arby's investment range, average gross sales and SBA repayment record from its FDD, with a full QSR comparison.
The data behind this guide
Across 198 SBA 7(a) loans, Arby's shows 33 defaults, a charge-off rate of 18.2%, in a category where the QSR average charge-off rate is 15.5%. The total investment runs $868,550 to $2,456,600. Average gross sales are $1,274,787. The question is whether that modest revenue can support a buildout that can reach $2.5M.
The cost to open an Arby's
| Cost Category | Low | High |
|---|---|---|
| Franchise fee | $37,500 | $37,500 |
| Equipment | $225,000 | $325,000 |
| Working capital | $33,000 | $100,000 |
| Total estimated investment | $868,550 | $2,456,600 |
The FDD's other Item 7 lines (building and site work, signage, opening inventory) make up the rest of the total.
Arby's $37,500 franchise fee compares with $15,000 at Sonic and $50,000 at Wendy's and $50,000 at Burger King. The total investment range is broad because Arby's operates freestanding drive-through restaurants, inline strip-mall locations, and non-traditional formats (airports, travel plazas, college campuses).
SBA loan performance: 198 loans, 33 defaults
SBA loans carry personal guarantees. If a franchisee defaults, they lose the business and face personal liability. Across 198 Arby's SBA 7(a) loans, 33 borrowers defaulted. For context, the national franchise average charge-off rate is 16.0% and the QSR category average is 15.5%.
The typical Arby's operator is an experienced multi-unit restaurant professional, not a first-time buyer. The SBA record is one signal, but with 198 loans on file the real risk picture also depends on unit economics — and those are tighter than the revenue headline suggests.
For comparison, here is how Arby's stacks up against its sister brands under Inspire Brands and competitors:
| Brand | SBA Charge-Off Rate | SBA Loans | Avg Gross Sales |
|---|---|---|---|
| Arby's | 18.2% | 198 | $1.3M |
| Sonic (sister brand) | 8.3% | 144 | $1.6M |
| Wendy's | N/A | 99 | $2.0M |
| Burger King | 7.3% | 275 | $1.7M |
| QSR Average | 15.5% | -- | Varies |
$1.3M revenue is the weak link
Average gross sales of $1,274,787 sit above the $1.1M QSR average. It trails Sonic ($1.6M), Wendy's ($2.0M) and McDonald's ($4.1M). Against the top of its investment range, a year of average gross sales comes to 0.5x the buildout.
The FDD does not disclose net income, so we cannot verify what Arby's owners actually take home. The royalty (4% of Gross Sales for Traditional Restaurants; 6.2% for Non-Traditional Restaurants) and the advertising fee together take 9.0% of gross sales, roughly $115K a year at the average, before food, labor, and rent are paid. Gross sales are not profit.
That leaves little room. Arby's SBA record shows 33 defaults across 198 loans, and operators with high buildout costs may struggle to service debt on this revenue base.
Growth: a net +1.2%
Arby's operates 3,265 total units and posted a net unit change of +1.2% in its latest FDD (136 openings against 78 closures). Compare Sonic (-2.3%), Subway (-5.2%), Jersey Mike's (+20.9%) and Wingstop (+34.7%).
Litigation: product misrepresentation and data breaches
The FDD discloses class action lawsuits regarding product misrepresentation (meat quantity and wagyu content claims) and data security breaches. The no-poaching settlements common to Inspire Brands also appear. These lawsuits affect brand perception and could deter customers, though Arby's has managed to maintain stable revenue through them.
20-year term with radius-based territory
The 20-year initial term is standard for large QSR brands. The radius-based territory gives you a defined market area, which is better than the location-only protection at Burger King and Wendy's. For a drive-through concept, the radius matters because your competition is every other restaurant within driving distance, including other Arby's locations.
The verdict on Arby's
Arby's has steady performance but no standout top line. The SBA record shows 33 defaults across 198 loans, a charge-off rate of 18.2%, and the $1,274,787 in average gross sales is the biggest limitation. For comparison, Wendy's discloses $2.0M on an investment of $1.6M – $3.1M and posts a N/A charge-off rate. If you want higher revenue per unit in the QSR space, other brands in the Inspire portfolio may disclose more revenue relative to buildout cost.
See the full breakdown on the Arby's profile page, or compare it to other QSR brands using real FDD and SBA data.
The bottom line
Arby's SBA record shows 33 defaults across 198 loans, a charge-off rate of 18.2%. And $1.3M in average gross sales is modest for a QSR investment that can reach $2.5M; that revenue gap is the risk factor to weigh first. Most buyers overlook Arby's because roast beef sandwiches are not as exciting as chicken or burgers, and the tight unit economics give that hesitation some grounding. That said, Arby's competes in a niche with almost no direct competitors, and being part of Inspire Brands gives it access to shared supply chain and technology investments from a portfolio that includes Dunkin', Sonic, and Buffalo Wild Wings. The question is whether the niche positioning and corporate backing are enough to offset the modest revenue.
Related franchise research
Continue your research with our Burger King franchise analysis, Chick-fil-A franchise model, and best food franchises guide.
Research Arby's further
- 📄 Get the Arby's Full FDD Report — $19
- 📞 Get Arby's FDD-listed franchisee contacts — $49 per brand. Call real owners before you sign.
- 📊 How to read profit in an FDD — free. Most FDDs disclose gross sales, not profit.
Frequently Asked Questions
- How much does an Arby's franchise cost?
- An Arby's franchise costs $868,550 to $2,456,600 to open, per its FDD. The franchise fee is $37,500.
- What is Arby's SBA loan performance?
- Arby's SBA data shows 198 loans with 33 defaults, a charge-off rate of 18.2%. For context, the national franchise average charge-off rate is 16.0% and the QSR category average is 15.5%.
- How does Arby's royalty compare to category average?
- Arby's royalty is 4% of Gross Sales for Traditional Restaurants; 6.2% for Non-Traditional Restaurants, plus a 5.0% advertising fee: 9.0% of gross sales combined. The QSR average royalty is 5.5%, and the combined load is above the 7.3% QSR average fee load.
- Does Arby's require owner-operators?
- Arby's focuses on multi-unit operators with restaurant experience. Inspire Brands (the parent company) typically approves franchisees who commit to developing multiple locations, which means the brand skews toward experienced operators rather than first-time franchise buyers.
- What other brands does Inspire Brands own besides Arby's?
- Inspire Brands is the second-largest restaurant company in the US, operating Arby's alongside Dunkin', Buffalo Wild Wings, Sonic Drive-In, Jimmy John's, and Baskin-Robbins.