Baja FreshFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Baja Fresh franchise requires a total initial investment of $429K – $1.0M, including a $30K franchise fee and an ongoing 5.0% royalty[2]. Per the 2025 FDD, average unit revenue was $869K[2]. SBA 7(a) loans show a 17.6% charge-off rate across 64 loans[1]. Verdict grade: B. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2025 FDD issuance
Overview
- Investment
- $429K – $1.0M
- 76th pct Service Resta…
- Avg gross sales
- $869K
- 28th pct Service Resta…
- Royalty
- 5.0%
- 13th pct Service Resta…
- Units
- 73
- 69th pct Service Resta…
- SBA default
- 17.6%
- system-wide median varies by category
Quick verdict · Quick-Service Restaurants · color = vs category peers
Green = >15% above Quick-Service Restaurants avg · No shading = within ±15% · Red = >15% below avg · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Franchising since 1991. Systems this mature have refined operations and brand recognition.
Franchised units fell from 96 to 11 over 3 years. Investigate why operators are leaving.
20 legal cases disclosed in the FDD. Read Item 3 before signing.
Bottom line
- Total investment $429K – $1.0M including a $30K franchise fee, 5.0% ongoing royalty.
- Average unit revenue of $869K/year (median $873K).
- Verdict B (Above Average) with a risk score of 55/100. SBA loan charge-off rate of 17.6% across 64 loans (above the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2024).
- 20 litigation matters disclosed in Item 3, higher than typical. Review the summary for patterns (franchisor-initiated vs. franchisee-initiated).
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- BF Acquisition Holdings, LLC
- Parent company
- MTY Franchising USA, Inc.
- Ultimate parent
- MTY
- CEO title
- Chief Executive Officer
- Eric Lefebvre
- Incorporated in
- DE
- HQ
- 9311 East Via De Ventura, Scottsdale, Arizona 85258
- Auditor
- PricewaterhouseCoopers LLP
- Audited financials
- Franchisor revenue
- $607K
- vs $598K prior year
- Management churn noted
- Frequent turnover
- Item 2 disclosed frequent executive changes
Overview
About
Franchisees operate fast-casual Mexican restaurants serving burritos, tacos, quesadillas, and fresh-mex bowls. Daily operations include food prep, kitchen management, customer service, inventory control, and P&L management across a single or multi-unit location with typical QSR staffing (5-15 employees). Franchisees are responsible for local marketing, hiring, and achieving brand standards while paying 5% royalties on all gross sales.
- CEO
- Eric Lefebvre
- Headquarters
- AZ
- Founded
- 1990
- FDD year
- 2025
- States available
- 12
FDD Item 7 · 2025 filing · 37 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Architect; Engineer; Drawings (Traditional) | $16K | $25K | |
| Permits (Traditional) | $5K | $32K | |
| Base building, Interior Improvements; Lighting; Tile; Millwork; Seat Fee Assessment (Traditional) | $187K | $419K | |
| Signage (Traditional) | $11K | $17K | |
| POS System (Traditional) | $11K | $20K | |
| Computer System (Traditional) | $800 | $1K | |
| Kitchen Equipment; Smallwares; Furniture (Traditional) | $100K | $319K | |
| Inventory; Uniforms (Traditional) | $4K | $8K | |
| Advertising (Traditional) | $3K | $10K | |
| Pre-opening training expenses (Traditional) | $12K | $21K | |
| Lease & Security Deposits (Traditional)not refundable | $10K | $15K | |
| Insurance - Liability & Workers Compensation (initial deposit) (Traditional) | $2K | $4K | |
| Legal Fees (Traditional) | $1K | $3K | |
| Initial Franchise Fee (Traditional) | $12K | $30K | |
| Depository Account (Traditional) | $3K | $3K | |
| Lease Review Fee (Traditional) | $0 | $3K | |
| Grand Opening Marketing (Traditional) | $10K | $10K | |
| Additional Funds - 3 months (Traditional) | $42K | $74K | |
| Architect; Engineer; Drawings (Non-Traditional) | $9K | $25K | |
| Permits (Non-Traditional) | $2K | $10K | |
| Total initial investment | $654K | $1.8M |
Line items extracted from FDD Item 7. Ranges reflect the franchisor's stated low and high per line. Total is the sum of line-item lows / highs — actual costs may fall outside this range depending on market and build-out scope.
Single-unit · estimated
Returns at a glance
Indicative numbers using FDD Item 7 / Item 19 inputs and category-benchmarked cost ratios. Full single-unit, 25-unit portfolio, and LBO models (with every input editable to stress-test your own scenario) live on the financials page.
Store EBITDA · annual
$122K
14.0% margin
Unlevered ROIC
16%
EBITDA / total invested capital
Payback
6.4 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $429K – $1.0M
- Below avg, review vs category
- Liquid capital req'd
- $42K – $74K
- Below avg, review vs category
- Franchise fee
- $15K – $30K
- Better than avg vs category
- Royalty
- 5.0%
- percentage_of_gross · typical 6–8%
- Ad fund
- 3.0%
- typical 3–5%
- Total fee load
- 8.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 5.0% of gross sales |
| Marketing / ad fund | 3.0% of gross sales |
| Technology fee | $55 |
| Training fee | $2K |
| Transfer fee | $15K |
| Renewal fee | $50 |
| Total fee load | 8.0% of rev |
Financial Performance
- Avg gross sales
- $869K
- Per unit, per year
- Median gross sales
- $873K
- Item 19 type
- gross_sales
- Sample size
- 63 units
- vs category median 28 · large
- Quartile band
- $374K→$1.4M
- Bottom 25% → top 25%
- Transparency
- 4 / 5
- vs category median 4 / 5 · typical
Compared against 453 Quick-Service Restaurants brands
vs Quick-Service Restaurants averages
How Baja Fresh Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 73
- Opened
- 1
- Last reporting year
- Closed
- 1
- Terminated
- 1
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 1
- Term expired, not renewed (per Item 20)
- Turnover rate
- 1.4%
- Company-owned
- 6
- Corporate units in the system
- % franchised
- 92%
- vs corporate-owned
- Net growth (yr3)
- +0.0%
- Net unit change last year
- 3-yr CAGR
- -13.0%
- Compounded over last 3 years
3-year detail · Item 20
- Transfers (3yr)
- 1
- Transfer rate
- 1.4%
- Owners selling to other franchisees
- Termination rate
- 2.7%
- Franchisor-initiated terminations
- Ceased ops
- 5.5%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 5 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 contact records (FDD Item 20). Shows states with at least one current operator on file. Full state registration data (Item 12) will appear on a future FDD refresh.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 64
- Loan volume
- $35.7M
- Median loan
- $590K
- 50th percentile
- Charge-off rate
- 17.6%
- rates vary by category · see methodology
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- 100.0%
- 5-yr charge-off
- 0.0%
- Loans approved 2021+
- Active lenders
- 33
- Defaults
- 9
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Baja Fresh's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 10 lenders with concentration factor
- Per-state charge-off rates across 6 states
- Startup risk premium and job creation velocity
- 8-year lending trend
- SBA 504 real estate/equipment data
Instant access. No subscription.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Baja Fresh represents a high-risk investment with a shrinking franchise system, hidden profitability metrics, corporate litigation patterns, and no franchisee protections—characteristics typical of declining brands in trouble.
Litigation (Item 3)
Two concluded cases involving franchisor predecessors and affiliates: (1) Purav Enterprises, L.L.C. et al. v. The Extreme Pita Franchising USA, Inc. et al. (Washington Superior Court 2015-2016) - allegations of FIPA violations, misrepresentation, and unregistered broker activities; settled for $20,000 on March 11, 2016. (2) KOHO, Inc. v. Kahala Franchising, L.L.C. (California Superior Court 2015-2017) - breach of contract, unjust enrichment, and fraud claims; court judgment awarded to Kahala with $205,000 in attorney's fees; ultimately settled June 19, 2017 when Kahala repurchased territory for $75,000 and forgave $130,000 in remaining damages.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · PricewaterhouseCoopers LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Kickbacks from required suppliers: No
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 55 / 100 rating
- 01MINORDeclining unit count (73 units with unknown/likely negative growth trajectory) suggests system contraction and franchisee struggles
- 02HIGHExtensive litigation history across parent company's portfolio (Kahala Franchising) involving breach of contract, financial misrepresentation, and state actions indicates systemic corporate governance issues
- 03MINORNo Item 19 (average net income) disclosure despite $868,755 average revenue is a major red flag—franchisor hiding profitability data suggests franchisees are underperforming or unprofitable
- 04HIGHGoing Concern status is False, indicating potential financial instability at corporate level that could affect franchisee support
- 05MEDNo territory protection combined with 73-unit system in decline creates cannibalization risk and no defensible market position
- 06MINORHigh investment-to-revenue ratio: $428k-$1M investment against $868k average revenue means ROI breakeven could take 1-2+ years with no margin for error
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 5 years |
| Allowed renewalsℹ | 1 |
| Protected territory | No |
| Online sales rights | Granted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 10 mi |
| Right of first refusalℹ | Yes |
| Transfer requires consent | Yes |
| Termination notice | 90 days |
| Mandatory arbitration | Yes |
| Arbitration location | county and state where the Franchised Business is located |
| Jury trial waiver | Yes |
| Governing law | Arizona |
| Litigation count | 20 |
View Item 3 litigation summary
Two concluded cases involving franchisor predecessors and affiliates: (1) Purav Enterprises, L.L.C. et al. v. The Extreme Pita Franchising USA, Inc. et al. (Washington Superior Court 2015-2016) - allegations of FIPA violations, misrepresentation, and unregistered broker activities; settled for $20,000 on March 11, 2016. (2) KOHO, Inc. v. Kahala Franchising, L.L.C. (California Superior Court 2015-2017) - breach of contract, unjust enrichment, and fraud claims; court judgment awarded to Kahala with $205,000 in attorney's fees; ultimately settled June 19, 2017 when Kahala repurchased territory for $75,000 and forgave $130,000 in remaining damages.
Items 10, 11
Training & Operations
- Classroom training
- 40 hrs
- On-the-job training
- 240 hrs
- Training location
- Online, KTEC (Kahala Training & Education Center) in Scottsdale, AZ, or at such other location designated by us
- Field support
- 0 hrs/yr
- On-site visits per year
- Time to open
- 9 mo
- From signing to launch
Items 5 & 11
Franchisor Support
Item 20 · call current owners
Franchisee Contacts
5 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Baja Fresh · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Baja Fresh franchise?
The total investment to open a Baja Fresh franchise ranges from $429K – $1.0M, with an initial franchise fee of $30K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Baja Fresh franchise owners earn?
According to Item 19 of the Baja Fresh FDD, the average gross sales per unit is $869K. The median is $873K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Baja Fresh's franchise failure rate?
Based on SBA 7(a) loan data, Baja Fresh has a charge-off rate of 17.6% across 64 loans, meaning 17.6% of franchise loans were charged off. Charge-off rates are one proxy for franchise risk, though they do not capture all closures. This data comes from FOIA-sourced SBA lending records.
How many Baja Fresh franchise locations are there?
As of their most recent FDD filing, Baja Fresh has 73 total units in the United States, including 96 franchised units and 6 company-owned units. 1 new units were opened in the latest reporting year.
Is Baja Fresh a good franchise to buy?
FranchiseVerdict rates Baja Fresh as a B-grade franchise with a risk score of 55 out of 100, based on our analysis of investment costs, revenue data, SBA loan performance, and growth trends. Our rating is based solely on publicly available FDD and government data; we recommend speaking with current franchisees before making any investment decision. This is not investment advice.
Data sourced from public FDD filings and SBA 7(a) FOIA records. Not financial advice.
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Data extracted from public FDD filings and SBA 7(a) loan disclosures (FOIA). This information is provided for research purposes only and does not constitute financial, legal, or investment advice. Verify all figures with the franchisor's current Franchise Disclosure Document before making any investment decision.