Bottom line
- Total investment $652K – $2.5M including a $38K franchise fee, 4.0% ongoing royalty.
- Average unit revenue of $1.3M/year (median $1.2M).
- Rated STRONG with a risk score of 39/100. SBA loan default rate of 0.0% across 261 loans (below the industry average).
- Established system with 3,265 units across 11 years of franchising — strong brand recognition and operational playbook.
Item 1 · who you're contracting with
The Franchisor
Yale framework · single-unit ROIC
Returns Analysis
Pulls Item 7 (investment) and Item 19 (revenue) from this brand's FDD into the Yale unlevered-ROIC formula. Override any input to stress-test it against your own assumptions.
The model · Yale framework
What would one Arby’s unit return on the cash you put in?
Unlevered ROIC · per unit
11%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Arby’s units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$1.7M
on $8.7M purchase
Total debt
$6.9M
SBA $4.3M + senior + seller note
Overview
About
Franchisees operate quick-service restaurants serving roast beef sandwiches and menu items, managing food preparation, inventory, staffing, customer service, and point-of-sale operations. Day-to-day activities include labor scheduling, food cost management, drive-thru operations (where applicable), and brand compliance with corporate marketing and operational standards. Franchisees are responsible for rent, utilities, payroll, and local marketing while paying 4-6.2% of gross sales in ongoing royalties.
Item 7 · what it costs
The Vitals
Item 19
Financial Performance
Item 20 · unit dynamics
The Growth Chart
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 6 states with active franchisees
The Territory Map
Derived from franchisee contact records. Shows states with at least one current operator — not where the franchisor is registered to sell new units (that data is re-extracting in a future refresh).
States derived from franchisee phone area codes (Item 20). Approximate — ported numbers may show the original state, not the franchisee's current location.
Government records
SBA Loan Data
Aggregated from SBA 7(a) loan disclosures, public data unique to FranchiseVerdict.
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Arby's presents moderate-to-cautionary risk due to stagnant growth, material litigation affecting brand reputation, opaque profitability disclosure, and elevated royalty burdens on a $1.27M revenue base.
Score breakdown · what drove the 39 / 100 rating
- 01MINORSlow unit growth of only 2.5% YoY suggests market saturation or franchisee underperformance in mature system
- 02MINORMultiple class action lawsuits regarding product misrepresentation (meat quantity/wagyu content) and data security breaches damage brand reputation and consumer trust
- 03MEDNo disclosed average net income despite $1.27M average revenue creates opacity around actual franchisee profitability and ROI
- 04MEDHigh royalty rates (4-6.2%) combined with undisclosed net margins make it difficult to validate ROI on $651k-$2.45M investment
- 05HIGHNo-poaching litigation and multi-state settlements indicate hostile franchisor-franchisee relations and potential labor recruitment restrictions
- 06MINORWide investment range ($1.8M spread) suggests highly variable unit economics depending on location/format, increasing execution risk
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
Item 11
Training & Operations
Item 20
Franchisee Contacts
Phone numbers extracted directly from this brand's FDD Item 20. After purchase, you'll also receive a list of validation questions tailored to this brand.
Franchisee contacts
99 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Arby’s · FDD (2026) PDF