Café MexicaliFranchise Cost, Revenue & Review 2026
Data from FDD filing
FranchiseVerdict summary · 2026
A Café Mexicali franchise requires a total initial investment of $558K – $1.2M, including a $35K franchise fee. Per the 2025 FDD, average unit revenue was $2.5M[2]. Verdict grade: A. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2025 FDD issuance
Overview
- Investment
- $558K – $1.2M
- 35th pct Service Resta…
- Avg gross sales
- $2.5M
- 24th pct Service Resta…
- Royalty
- N/A
- Units
- 5
- 13th pct Service Resta…
- SBA default
- N/A
Quick verdict · Full-Service Restaurants · color = vs category peers
Green = >15% above Full-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
The franchisor's auditor raised doubt about continued operations. This is a serious risk signal.
52% cash-on-cash return (based on P&L Bottom Line). Above the 20% threshold most investors target.
Bottom line
- Total investment $558K – $1.2M including a $35K franchise fee.
- Average unit revenue of $2.5M/year, with an estimated 52% cash-on-cash return (based on P&L Bottom Line).
- Verdict A (Top Quintile) with a risk score of 28/100.
- Auditor disclosed a going-concern note, which flagged doubt about the franchisor's ability to continue operations. Verify against the latest FDD.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Café Mexicali – Franchising, LLC
- Parent company
- Café Mexicali, Inc.
- CEO title
- Co-Founder, Chief Executive Officer
- Richard A. Krammer
- CEO experience
- 19 yrs
- Years in role or industry
- Founder active
- Yes
- Original founder still leading the business
- Incorporated in
- CO
- HQ
- 1919 65th Avenue, Unit 5, Greeley, Colorado 80634
- Auditor
- A&G LLP
- Audited financials
- Franchisor revenue
- $0
- Most recent fiscal year
- ⚠ Going-concern note
- Disclosed in FDD 2025
- Auditor flagged doubt about continued operations. Verify against the latest FDD before deciding.
Overview
About
Franchisees operate quick-service Mexican restaurants focused on authentic cuisine, likely managing kitchen operations, food prep, customer service, and staff supervision. Day-to-day responsibilities include inventory management, food cost control, labor scheduling, and maintaining brand standards across menu items and customer experience.
- CEO
- Richard A. Krammer
- Headquarters
- CO
- Founded
- 2021
- FDD year
- 2025
- States available
- 1
FDD Item 7 · 2025 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $35K | $35K |
| Working capital (3–6 mo) | $30K | $95K |
| Equipment, build-out, other | $493K | $1.1M |
| Total initial investment | $558K | $1.2M |
Source: Café Mexicali 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
$196K
8.0% margin
Unlevered ROIC
20%
EBITDA / total invested capital
Payback
4.9 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $558K – $1.2M
- Better than avg vs category
- Liquid capital req'd
- $30K – $95K
- Better than avg vs category
- Franchise fee
- $35K – $35K
- Better than avg vs category
- Royalty
- Weeks 1 to 20: 3% of Gross Sales; Week 21 through the end…
- Ad fund
- 4.0%
- typical 3–5%
- Total fee load
- 32.0%
- vs 9–13% typical
- Payback period
- 1.9 yrs
- From FDD / Item 19
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty (flat) | Weeks 1 to 20: 3% of Gross Sales, Week 21 through end of Term: 6% of Gross Sales |
| Marketing / ad fund | 4.0% of gross sales |
| Technology fee | $25 |
| Transfer fee | $21K |
| Renewal fee | $5K |
| Total fee load | 32.0% of rev |
At 32.0% total fee load, roughly $785K per year goes to the franchisor before you pay a single operating expense.
Financial Performance
- Avg gross sales
- $2.5M
- Per unit, per year
- Median gross sales
- N/A
- Avg p&l bottom line
- $466K
- Reported as P&L Bottom Line in FDD Item 19
- Cash-on-cash
- 51.8%
- Based on P&L Bottom Line / investment midpoint
- Item 19 type
- Profit and loss statements for affiliate-owned restaurants
- Sample size
- 5 units
- vs category median 13 · small
- Range (low → high)
- $1.5M→$3.4M
- Cohort dispersion (min → max)
- Transparency
- 10 / 5
- vs category median 4 / 5 · above
Compared against 1264 Full-Service Restaurants brands
vs Full-Service Restaurants averages
How Café Mexicali Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 5
- Opened
- 1
- Last reporting year
- Closed
- 0
- Terminated
- 0
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 0.0%
- Company-owned
- 5
- Corporate units in the system
- % franchised
- 0%
- vs corporate-owned
3-year detail · Item 20
- Transfers (3yr)
- 0
- Projected new
- 2
- Franchisor's next-year forecast
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 3 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
Café Mexicali presents moderate-to-cautious risk due to minimal system scale (5 units), unclear growth prospects, and a punitive royalty escalation that doubles in year two, though unit economics and absence of litigation provide some stability.
Litigation (Item 3)
No litigation is required to be disclosed in Item 3
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · A&G LLP⚠ Going-concern note flagged
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
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 28 / 100 rating
- 01MINOROnly 5 units in system with unknown growth trajectory suggests minimal scale and potentially stagnant expansion
- 02MINORRoyalty structure doubles from 3% to 6% in week 21, creating significant cost increase that could compress margins substantially
- 03MINORLarge investment range ($558K-$1.24M) with only 5 units makes performance benchmarking difficult and suggests inconsistent unit economics
- 04HIGHNo disclosed litigation is positive, but extremely small unit count limits meaningful litigation history
- 05MINORAverage net income of $466K on $2.36M revenue (19.7% net margin) is solid but unclear if this reflects mature units, new units, or company-operated locations
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 | Radius |
| Protected territory | Yes |
| Exclusive territoryℹ | No |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 25 mi |
| Right of first refusalℹ | Yes |
| RoFR response window | 45 days |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | No |
| Jury trial waiver | Yes |
| Governing law | Colorado |
| Litigation count | 0 |
View Item 3 litigation summary
No litigation is required to be disclosed in Item 3
Items 10, 11
Training & Operations
- Classroom training
- 10 hrs
- On-the-job training
- 110 hrs
- Training location
- On-site and at franchisor location
- POS system
- Heartland Restaurant
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Heartland Restaurant
Item 20 · call current owners
Franchisee Contacts
3 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Café Mexicali · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Café Mexicali franchise?
The total investment to open a Café Mexicali franchise ranges from $558K – $1.2M, with an initial franchise fee of $35K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Café Mexicali franchise owners earn?
According to Item 19 of the Café Mexicali FDD, the average gross sales per unit is $2.5M. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Café Mexicali's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Café Mexicali (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 Café Mexicali franchise locations are there?
As of their most recent FDD filing, Café Mexicali has 5 total units in the United States, including 0 franchised units and 5 company-owned units. 1 new units were opened in the latest reporting year.
Is Café Mexicali a good franchise to buy?
FranchiseVerdict rates Café Mexicali as a A-grade franchise with a risk score of 28 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.