Break Coffee Co.Franchise Cost, Revenue & Review 2026
Data from FDD filing
FranchiseVerdict summary · 2026
A Break Coffee Co. franchise requires a total initial investment of $103K – $146K, including a $60K franchise fee and an ongoing 12.0% royalty[2]. Per the 2025 FDD, average unit revenue was $152K[2]. Verdict grade: F. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2025 FDD issuance
Overview
- Investment
- $103K – $146K
- 9th pct Service Resta…
- Avg gross sales
- $152K
- 0th pct Service Resta…
- Royalty
- 12.0%
- 85th pct Service Resta…
- Units
- 9
- 33rd pct Service Resta…
- SBA default
- N/A
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
Started franchising in 2025. Newer systems carry more uncertainty but may offer better territories.
Franchised units fell from 9 to 8 over 3 years. Investigate why operators are leaving.
54% cash-on-cash return (based on Gross Margin). Above the 20% threshold most investors target.
Bottom line
- Total investment $103K – $146K including a $60K franchise fee, 12.0% ongoing royalty.
- Average unit revenue of $152K/year (median $142K), with an estimated 54% cash-on-cash return (based on Gross Margin). Note: this is gross profit, not take-home income.
- Verdict F (Bottom Quintile) with a risk score of 97/100.
- Emerging franchise: only 1 year of franchising with 9 units. Early-stage systems carry higher risk but may offer better territory availability.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Break Coffee Co Franchising LLC
- Parent company
- Westside Xpresso Delight LLC
- Ultimate parent
- XD USA Holdings LLC and Westside XD, LLC
- CEO title
- Chief Executive Officer
- Joshua Kovacs
- Founder active
- Yes
- Original founder still leading the business
- Incorporated in
- DE
- HQ
- 155 2nd Street, Jersey City, New Jersey 07302
- Auditor
- Citrin Cooperman & Company, LLP
- Audited financials
- Management churn noted
- Frequent turnover
- Item 2 disclosed frequent executive changes
Overview
About
Break Coffee Co. franchisees operate specialty coffee retail locations, likely serving espresso-based beverages, specialty drinks, and café items. Day-to-day operations include inventory management, barista labor scheduling, customer service, point-of-sale management, and maintaining brand standards across a protected territory.
- CEO
- Joshua Kovacs
- Headquarters
- NJ
- Founded
- 2023
- FDD year
- 2025
- States available
- 6
FDD Item 7 · 2025 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $60K | $60K |
| Working capital (3–6 mo) | $10K | $40K |
| Equipment, build-out, other | $33K | $47K |
| Total initial investment | $103K | $146K |
Source: Break Coffee Co. 2025 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
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
$12K
8.0% margin
Unlevered ROIC
8%
EBITDA / total invested capital
Payback
12.3 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $103K – $146K
- Better than avg vs category
- Liquid capital req'd
- $10K – $40K
- Better than avg vs category
- Franchise fee
- $60K – $195K
- Below avg, review vs category
- Royalty
- 12.0%
- percentage_of_gross · typical 6–8%
- Ad fund
- 2.0%
- typical 3–5%
- Total fee load
- 63.0%
- vs 9–13% typical
- Payback period
- 1.9 yrs
- From FDD / Item 19
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 12.0% of gross sales |
| Marketing / ad fund | 2.0% of gross sales |
| Technology fee | $49 |
| Transfer fee | $3K |
| Total fee load | 63.0% of rev |
At 63.0% total fee load, roughly $96K per year goes to the franchisor before you pay a single operating expense.
Financial Performance
- Avg gross sales
- $152K
- Per unit, per year
- Median gross sales
- $142K
- Avg gross margin
- $67K
- Reported as Gross Margin in FDD Item 19
- Cash-on-cash
- 53.8%
- Based on Gross Margin / investment midpoint
- Item 19 type
- Historic Financial Performance
- Sample size
- 8 units
- vs category median 28 · small
- Range (low → high)
- $11K→$289K
- Cohort dispersion (min → max)
- Transparency
- 10 / 5
- vs category median 4 / 5 · above
Compared against 453 Quick-Service Restaurants brands
vs Quick-Service Restaurants averages
How Break Coffee Co. Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 9
- Opened
- 0
- Last reporting year
- Closed
- 1
- Terminated
- 1
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 11.1%
- Company-owned
- 1
- Corporate units in the system
- % franchised
- 89%
- vs corporate-owned
- Net growth (yr3)
- +0.0%
- Net unit change last year
- 3-yr CAGR
- +0.0%
- Compounded over last 3 years
3-year detail · Item 20
- Transfers (3yr)
- 0
- Projected new
- 4
- Franchisor's next-year forecast
- Termination rate
- 11.1%
- Franchisor-initiated terminations
- Ceased ops
- 11.1%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 17 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.
No SBA loan data available for this brand.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Small, litigious system with going concern issues, unverified financials, high royalties relative to margins, and unclear growth prospects — elevated risk for capital loss.
Litigation (Item 3)
XD Franchising LLC v. Stuart Mills (Case No. 01-24-0006-6292) - Commercial arbitration filed July 22, 2024 against former franchisee for violation of non-compete provisions. Franchisor obtained preliminary injunction on August 19, 2024. Settled October 29, 2024 with former franchisee paying $8,915.38 and selling competing business assets to franchisor for $100.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Citrin Cooperman & Company, LLP
Supplier relationship · Items 8 & 16
- Franchisor sells you products: Yes
- 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 97 / 100 rating
- 01HIGHGoing Concern status is FALSE — franchisor may face operational or financial viability issues
- 02MINOROnly 9 units with unknown growth trajectory — minimal scale and unclear system expansion
- 03HIGHActive litigation (2024) involving non-compete enforcement suggests franchisor aggressively polices agreements and potential franchisee conflicts
- 04MED12% royalty on gross sales is high relative to net margin (~44% net income suggests 56% operating costs) — leaves limited cushion
- 05MINORNo Item 19 financial performance representations — cannot independently verify claimed $151,804 avg revenue or $66,805 net income
- 06MINORHigh initial investment ($102.5K–$146K) combined with unknown unit performance creates ROI uncertainty
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 | 1 |
| Territory type | Geographic (Zip codes, jurisdiction boundaries, or geographic lines) |
| Protected territory | Yes |
| Exclusive territoryℹ | Yes |
| Online sales rights | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 15 mi |
| Right of first refusalℹ | Yes |
| RoFR response window | 30 days |
| Transfer requires consent | Yes |
| Termination notice | 5 days |
| Mandatory arbitration | Yes |
| Arbitration location | Hudson County, New Jersey |
| Governing law | New Jersey |
| Litigation count | 1 |
View Item 3 litigation summary
XD Franchising LLC v. Stuart Mills (Case No. 01-24-0006-6292) - Commercial arbitration filed July 22, 2024 against former franchisee for violation of non-compete provisions. Franchisor obtained preliminary injunction on August 19, 2024. Settled October 29, 2024 with former franchisee paying $8,915.38 and selling competing business assets to franchisor for $100.
Items 10, 11
Training & Operations
- Classroom training
- 16 hrs
- On-the-job training
- 0 hrs
- Training location
- Off-site and On-site
- Ongoing training
- Required
- Time to open
- 3 mo
- From signing to launch
- POS system
- Cloud-based customer management platform (“CMP”)
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Cloud-based customer management platform (“CMP”)
Item 20 · call current owners
Franchisee Contacts
23 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Break Coffee Co. · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Break Coffee Co. franchise?
The total investment to open a Break Coffee Co. franchise ranges from $103K – $146K, with an initial franchise fee of $60K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Break Coffee Co. franchise owners earn?
According to Item 19 of the Break Coffee Co. FDD, the average gross sales per unit is $152K. The median is $142K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Break Coffee Co.'s franchise failure rate?
SBA 7(a) loan charge-off data is not available for Break Coffee Co. (fewer than 10 loans on file). Charge-off rates are one way to gauge franchise risk, but not all franchise loans go through the SBA program. We recommend reviewing turnover and closure data in the FDD and speaking with current franchisees.
How many Break Coffee Co. franchise locations are there?
As of their most recent FDD filing, Break Coffee Co. has 9 total units in the United States, including 9 franchised units and 1 company-owned units.
Is Break Coffee Co. a good franchise to buy?
FranchiseVerdict rates Break Coffee Co. as a F-grade franchise with a risk score of 97 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.
For franchisors
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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.