Carvel
Bottom line
- Total investment $392K – $786K including a $31K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $484K/year (median $481K).
- Rated MODERATE with a risk score of 61/100. SBA loan default rate of 0.0% across 5 loans (below the industry average).
- No protected territory and the franchisor reserves the right to compete in your area. Clarify territorial boundaries before signing.
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 Carvel unit return on the cash you put in?
Unlevered ROIC · per unit
7%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Carvel units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$194K
on $968K purchase
Total debt
$774K
SBA $0.5M + senior + seller note
Overview
About
Carvel franchisees operate ice cream retail shops selling soft-serve ice cream, cakes, and novelties. Day-to-day operations involve staffing, inventory management, customer service, and seasonal marketing to drive walk-in and catering sales. Most locations are small-format standalone or co-branded stores in convenience-based retail corridors.
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 · 13 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
Carvel presents caution-level risk due to declining unit economics, absence of financial validation data, unprotected territory, and parent company litigation suggesting systemic operational issues.
Score breakdown · what drove the 61 / 100 rating
- 01MINORDeclining unit count (3.1% YoY contraction indicates system shrinkage)
- 02MINORNo Item 19 financial disclosure — cannot verify if $484K avg revenue translates to positive ROI after 6% royalty + operating costs
- 03MINORUnprotected territory creates direct competition risk from other Carvel franchisees
- 04HIGHParent company litigation history (no-poaching + data breach) suggests operational/compliance vulnerabilities affecting franchise ecosystem
- 05MEDHigh investment range ($392K-$786K) with no disclosed net income data creates profitability opacity
- 06MINOR20-year commitment is lengthy given brand's contracting footprint and uncertain profitability
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
97 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Carvel · FDD (2025) PDF