Bottom line
- Total investment $330K – $527K including a $35K franchise fee, 2.5% ongoing royalty.
- Average unit revenue of $792K/year (median $703K).
- Rated MODERATE with a risk score of 55/100. SBA loan default rate of 0.0% across 14 loans (below the industry average).
- System contracting at -38.2% CAGR over 3 years. Investigate whether closures are franchisor-driven (consolidation) or franchisee-driven (economics).
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 Car-X unit return on the cash you put in?
Unlevered ROIC · per unit
21%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Car-X units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$872K
on $4.4M purchase
Total debt
$3.5M
SBA $2.2M + senior + seller note
Overview
About
Car-X franchisees operate automotive maintenance and repair facilities, providing services such as oil changes, brake service, tire care, and general maintenance. Day-to-day operations include managing service technicians, scheduling appointments, procuring parts, and handling customer service and billing.
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 · 8 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
Car-X presents elevated risk due to contracting franchise system, undisclosed profitability metrics, and high capital requirements without clear path to positive ROI validation.
Score breakdown · what drove the 55 / 100 rating
- 01MINORUnit count declining 6.0% YoY (118 units) indicates system contraction and potential franchisee dissatisfaction
- 02MEDNet income not disclosed in Item 19 — cannot assess actual profitability or ROI despite $792k avg revenue
- 03MINORHigh initial investment ($330k-$527k) combined with declining unit growth raises recapture risk
- 04MINORRoyalty structure front-loads incentive (2.5% for 180 days) then jumps to 5% — suggests franchisor prioritizes short-term ramp-up over franchisee sustainability
- 05HIGHNo litigation disclosed is positive, but absence of financial performance data is critical gap in due diligence
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
64 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Car-X · FDD (2025) PDF