Big Apple BagelsFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Big Apple Bagels franchise requires a total initial investment of $513K – $745K, including a $25K franchise fee and an ongoing 5.0% royalty[2]. Per the 2026 FDD, average unit revenue was $632K[2]. SBA 7(a) loans show a 34.6% charge-off rate across 83 loans[1]. Verdict grade: D. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2026 FDD issuance
Overview
- Investment
- $513K – $745K
- 82nd pct Service Resta…
- Avg gross sales
- $632K
- 16th pct Service Resta…
- Royalty
- 5.0%
- 13th pct Service Resta…
- Units
- 48
- 62nd pct Service Resta…
- SBA default
- 34.6%
- 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
34.6% of SBA loans charged off across 83 loans, above the 16% franchise average.
Franchising since 1993. Systems this mature have refined operations and brand recognition.
Franchised units fell from 49 to 48 over 3 years. Investigate why operators are leaving.
Bottom line
- Total investment $513K – $745K including a $25K franchise fee, 5.0% ongoing royalty.
- Average unit revenue of $632K/year.
- Verdict D (Below Average) with a risk score of 74/100. SBA loan charge-off rate of 34.6% across 83 loans (well above the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2024).
- Bankruptcy history disclosed in the FDD. Review Item 4 for details before proceeding.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- BAB SYSTEMS, INC.
- Parent company
- BAB, Inc.
- Predecessor
- of BAB
- Prior franchisor entity
- Incorporated in
- IL
- HQ
- 500 Lake Cook Road, Suite 475, Deerfield, Illinois 60015
- Auditor
- Sassetti LLC
- Audited financials
- Franchisor revenue
- $3.3M
- vs $3.3M prior year
Affiliated brands
- To simplify the language in this Franchise Disclosure Document
Other brands the franchisor or its parent operates (Item 1).
Overview
About
Big Apple Bagels franchisees operate quick-service bagel cafés selling fresh bagels, spreads, sandwiches, and beverages. Day-to-day operations include bagel production/baking, food prep, POS management, staff scheduling, inventory ordering, and customer service in a compact retail footprint.
- CEO
- MICHAEL W. EVANS
- Headquarters
- IL
- Founded
- 1992
- FDD year
- 2026
- States available
- 12
FDD Item 7 · 2026 filing · 12 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Fee | $25K | $25K | |
| Store Opening Marketing Feenot refundable | $8K | $8K | |
| Professional Feesnot refundable | $5K | $10K | |
| First Month's Rent and Security Depositnot refundable | $4K | $9K | |
| Insurancenot refundable | $5K | $9K | |
| Leasehold Improvementsnot refundable | $200K | $350K | |
| Exterior and Interior Signage and Displaynot refundable | $6K | $12K | |
| Furniture, Fixtures, Equipmentnot refundable | $230K | $275K | |
| Trainingnot refundable | $3K | $5K | |
| Prepaid Expenses, Depositsnot refundable | $500 | $2K | |
| Opening Inventory, Suppliesnot refundable | $15K | $23K | |
| Additional Funds - 3 monthsnot refundable | $12K | $18K | |
| Total initial investment | $513K | $745K |
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
$89K
14.0% margin
Unlevered ROIC
14%
EBITDA / total invested capital
Payback
7.3 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $513K – $745K
- Below avg, review vs category
- Liquid capital req'd
- $12K – $18K
- Better than avg vs category
- Franchise fee
- $15K – $25K
- Better than avg vs category
- Royalty
- 5.0%
- Gross Revenues · 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 |
| Transfer fee | $5K |
| Renewal fee | $3K |
| Inventory (initial) | $15K – $23K |
| Total fee load | 8.0% of rev |
Financial Performance
- Avg gross sales
- $632K
- Per unit, per year
- Median gross sales
- N/A
- Item 19 type
- gross_sales
- Sample size
- 47 units
- vs category median 28
- Range (low → high)
- $174K→$1.4M
- Cohort dispersion (min → max)
- Quartile band
- $365K→$923K
- Bottom 25% → top 25%
- Transparency tier
- revenue_only
- Categorical assessment of disclosure depth
- Transparency
- 3 / 5
- vs category median 4 / 5 · below
Compared against 453 Quick-Service Restaurants brands
vs Quick-Service Restaurants averages
How Big Apple Bagels Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 48
- Opened
- 0
- Last reporting year
- Closed
- 1
- Turnover rate
- 2.1%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (yr3)
- -2.0%
- Net unit change last year
- 3-yr CAGR
- -2.0%
- Compounded over last 3 years
3-year detail · Item 20
- Transfers (3yr)
- 2
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 20 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
- 83
- Loan volume
- $11.0M
- Median loan
- $128K
- 50th percentile
- Charge-off rate
- 34.6%
- 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)
- 65.4%
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 48
- Defaults
- 27
Vintage analysis
Big Apple Bagels charge-off rate by loan vintage
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Big Apple Bagels'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 15 states
- Startup risk premium and job creation velocity
- 21-year lending trend
- SBA 504 real estate/equipment data
Instant access. No subscription.
A 34.6% charge-off rate means roughly 1 in 3 franchisees failed to repay their SBA loan. Investigate what changed.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Big Apple Bagels presents moderate-to-caution risk due to declining unit growth, absent net income disclosure, unprotected territories, and high capital requirements relative to an unproven ROI model.
Litigation (Item 3)
0 case reference(s): 0 pending, 0 settled.
Bankruptcy (Item 4)
Disclosed in last 7 years
Bankruptcy Code; (b) obtained a discharge of its debts under the bankruptcy code; or (c) was a principal officer of a company or a general partner in a partnership that either filed as a debtor (or had filed against it) a petition to start an action under the U.S. Bankruptcy Code or that obtained a
Audited financials (Item 21)
Yes · Sassetti LLC
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Must buy proprietary products: No
- Restricted to system-approved products: No
Score breakdown · what drove the 74 / 100 rating
- 01MINORDeclining unit count (-2.0% YoY) signals system contraction and potential franchisee dissatisfaction
- 02MEDNet income not disclosed in FDD Item 19 — impossible to validate profitability claims or ROI
- 03MINORNo protected territory creates direct competition risk; new units could cannibalize existing franchise revenue
- 04MINORHigh initial investment ($512.5K–$745K) with unverified return expectations and no income disclosure
- 05MINOR5% royalty on $632K average revenue = $31.6K annual payment with unknown profit margins
- 06MED48-unit system is small and vulnerable; limited economies of scale and supplier negotiating power
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 | 10 years |
| Allowed renewalsℹ | 2 |
| Territory type | Specific Location |
| Protected territory | No |
| Online sales rights | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Non-compete (years)ℹ | 2 years |
| Right of first refusalℹ | Yes |
| Termination notice | 30 days |
| Curable defaultsℹ | 3 |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Governing law | Illinois |
| Litigation count | 0 |
View Item 3 litigation summary
0 case reference(s): 0 pending, 0 settled.
Items 10, 11
Training & Operations
- Classroom training
- 22 hrs
- On-the-job training
- 75 hrs
- Training location
- On-site and corporate
- Site selection
- joint
- POS system
- MicroSale POS
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: MicroSale POS
Item 20 · call current owners
Franchisee Contacts
67 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Big Apple Bagels · FDD (2026) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Big Apple Bagels franchise?
The total investment to open a Big Apple Bagels franchise ranges from $513K – $745K, with an initial franchise fee of $25K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Big Apple Bagels franchise owners earn?
According to Item 19 of the Big Apple Bagels FDD, the average gross sales per unit is $632K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Big Apple Bagels's franchise failure rate?
Based on SBA 7(a) loan data, Big Apple Bagels has a charge-off rate of 34.6% across 83 loans, meaning 34.6% 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 Big Apple Bagels franchise locations are there?
As of their most recent FDD filing, Big Apple Bagels has 48 total units in the United States, including 49 franchised units and 0 company-owned units.
Is Big Apple Bagels a good franchise to buy?
FranchiseVerdict rates Big Apple Bagels as a D-grade franchise with a risk score of 74 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.