Clothes MentorFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Clothes Mentor franchise requires a total initial investment of $308K – $432K, including a $25K franchise fee and an ongoing 4.0% royalty[2]. Per the 2026 FDD, average unit revenue was $820K[2]. SBA 7(a) loans show a 7.1% charge-off rate across 67 loans[1]. Verdict grade: A. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2026 FDD issuance
Overview
- Investment
- $308K – $432K
- 32nd pct Retail
- Avg gross sales
- $820K
- 11th pct Retail
- Royalty
- 4.0%
- 3rd pct Retail
- Units
- 113
- 28th pct Retail
- SBA default
- 7.1%
- system-wide median varies by category
Quick verdict · Retail · color = vs category peers
Green = >15% above Retail 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
Bottom line
- Total investment $308K – $432K including a $25K franchise fee, 4.0% ongoing royalty.
- Average unit revenue of $820K/year (median $744K).
- Verdict A (Top Quintile) with a risk score of 24/100. SBA loan charge-off rate of 7.1% across 67 loans (near or below the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2024).
- System contracting at -5.8% CAGR over 3 years. Investigate whether closures are franchisor-driven (consolidation) or franchisee-driven (economics).
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Clothes Mentor, LLC
- Parent company
- NTY Franchise Company, LLC
- Predecessor
- and Affiliates
- Prior franchisor entity
- CEO title
- President
- Ronald G. Olson
- CEO experience
- 35 yrs
- Years in role or industry
- Founder active
- Yes
- Original founder still leading the business
- Incorporated in
- DE
- HQ
- 13895 Industrial Park Blvd, Ste 100, Plymouth, MN 55441
- Auditor
- LB Carlson, LLP
- Audited financials
- Franchisor revenue
- $3.8M
- vs $3.8M prior year
- Management churn noted
- Frequent turnover
- Item 2 disclosed frequent executive changes
Affiliated brands
- Device Pitstop
- NTY Clothing Exchange
Other brands the franchisor or its parent operates (Item 1).
Overview
About
Clothes Mentor franchisees operate consignment and resale clothing retail stores focused on women's and children's apparel. Day-to-day operations include inventory acquisition (consignment negotiations), visual merchandising, point-of-sale transactions, staff management, and customer service in a thrift-to-upscale secondhand retail environment.
- CEO
- Ronald G. Olson
- Headquarters
- MN
- Founded
- 2006
- FDD year
- 2026
- States available
- 30
FDD Item 7 · 2026 filing · 15 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Feenot refundable | $25K | $25K | |
| Leasehold Improvements | $25K | $60K | |
| Signs | $5K | $9K | |
| Fixtures and Supplies | $70K | $90K | |
| Proprietary Software and POS System | $25K | $25K | |
| Inventory | $60K | $80K | |
| Deposits, Business Licenses and Permits | $7K | $15K | |
| Legal and Accounting | $0 | $4K | |
| Security | $7K | $10K | |
| Travel Expenses to Attend Training | $4K | $9K | |
| Pre-Opening Labor Expenses | $10K | $15K | |
| Grand Opening Advertising | $16K | $20K | |
| Miscellaneous Pre-opening Expenses | $14K | $20K | |
| Rent - 3 Months | $20K | $25K | |
| Additional Funds - 3 Months | $20K | $25K | |
| Total initial investment | $308K | $432K |
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
$66K
8.0% margin
Unlevered ROIC
17%
EBITDA / total invested capital
Payback
6.0 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $308K – $432K
- Better than avg vs category
- Liquid capital req'd
- $20K – $25K
- Better than avg vs category
- Franchise fee
- $20K – $25K
- Better than avg vs category
- Royalty
- 4.0%
- Net Sales · typical 6–8%
- Ad fund
- $3,000
- Total fee load
- 4.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 4.0% of gross sales |
| Technology fee | $2K |
| Training fee | $500 |
| Transfer fee | $8K |
| Renewal fee | $10K |
| Total fee load | 4.0% of rev |
A 4.0% total fee load is unusually lean. More of each revenue dollar stays with the franchisee.
Financial Performance
- Avg gross sales
- $820K
- Per unit, per year
- Median gross sales
- $744K
- Item 19 type
- net_sales
- Sample size
- 103 units
- vs category median 49 · large
- Range (low → high)
- $183K→$2.4M
- Cohort dispersion (min → max)
- Quartile band
- $385K→$1.3M
- Bottom 25% → top 25%
- Reporting year
- 2025
- Fiscal year the figures cover
- Transparency
- 6 / 5
- vs category median 2 / 5 · above
Compared against 304 Retail brands
vs Retail averages
How Clothes Mentor Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 113
- Opened
- 3
- Last reporting year
- Closed
- 3
- Terminated
- 0
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 2.7%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (yr3)
- +0.0%
- Net unit change last year
- 3-yr CAGR
- -5.8%
- Compounded over last 3 years
3-year detail · Item 20
- Closed (3yr)
- 3
- Transfers (3yr)
- 6
- Transfer rate
- 5.3%
- Owners selling to other franchisees
- Ceased ops
- 2.6%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 28 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.
Available to sell in · Item 12
- Michigan
States where the franchisor is registered to sell new franchises (FDD registration filings).
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 67
- Loan volume
- $12.8M
- Median loan
- $186K
- 50th percentile
- Charge-off rate
- 7.1%
- 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)
- 92.7%
- 5-yr charge-off
- 25.0%
- Loans approved 2021+
- Active lenders
- 29
- Defaults
- 3
Vintage analysis
Clothes Mentor 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 Clothes Mentor'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
- 14-year lending trend
- SBA 504 real estate/equipment data
Instant access. No subscription.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Clothes Mentor presents meaningful litigation history tied to financial misrepresentation, undisclosed profitability metrics, and unclear unit growth, warranting caution despite reasonable royalty rates and protected territory.
Litigation (Item 3)
Two franchisee arbitration cases: (1) CSW Strategic Solutions, LLC v. NTY Franchise Company, LLC (settled August 2021 for $400,000); (2) Transcendent Business Holdings, LLC v. NTY Franchise Company, LLC (commenced August 2019, details incomplete)
Largest disclosed settlement: $400,000
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · LB Carlson, LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Kickbacks from required suppliers: No
- Must buy proprietary products: No
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 24 / 100 rating
- 01HIGHTwo concluded arbitrations involving fraud and breach of contract claims with $1.05M in combined settlements raise credibility concerns about financial performance representations
- 02MEDNet Income not disclosed in Item 19 prevents validation of the $819,550 average revenue figure and makes ROI analysis impossible
- 03MINORUnknown unit growth trajectory over 10+ years of operation with only 113 units suggests stagnation or inconsistent expansion
- 04MED4% royalty on total net sales (not gross) is favorable, but paired with undisclosed profitability creates opacity around true franchisee earnings
- 05MEDHigh initial investment range ($308K-$431.5K) relative to disclosed revenue without corresponding net income data increases financial risk
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 | Radius |
| Protected territory | Yes |
| Exclusive territoryℹ | Yes |
| Online sales rightsℹ | Granted |
| 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 |
| Termination groundsℹ | 1 |
| Curable defaultsℹ | 2 |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Governing law | The laws of the state where your Store is located |
| Litigation count | 2 |
View Item 3 litigation summary
Two franchisee arbitration cases: (1) CSW Strategic Solutions, LLC v. NTY Franchise Company, LLC (settled August 2021 for $400,000); (2) Transcendent Business Holdings, LLC v. NTY Franchise Company, LLC (commenced August 2019, details incomplete)
Items 10, 11
Training & Operations
- Classroom training
- 49 hrs
- On-the-job training
- 53 hrs
- Field support
- 28 hrs/yr
- On-site visits per year
- POS system
- Resale1
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Resale1
Item 20 · call current owners
Franchisee Contacts
95 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Clothes Mentor · FDD (2026) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Clothes Mentor franchise?
The total investment to open a Clothes Mentor franchise ranges from $308K – $432K, 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 Clothes Mentor franchise owners earn?
According to Item 19 of the Clothes Mentor FDD, the average gross sales per unit is $820K. The median is $744K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Clothes Mentor's franchise failure rate?
Based on SBA 7(a) loan data, Clothes Mentor has a charge-off rate of 7.1% across 67 loans, meaning 7.1% 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 Clothes Mentor franchise locations are there?
As of their most recent FDD filing, Clothes Mentor has 113 total units in the United States, including 113 franchised units and 0 company-owned units. 3 new units were opened in the latest reporting year.
Is Clothes Mentor a good franchise to buy?
FranchiseVerdict rates Clothes Mentor as a A-grade franchise with a risk score of 24 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
Are you the franchisor?
If you represent Clothes Mentor, you can request corrections or provide updated information.
Claim this brandOther Retail franchises
Compare similar franchise opportunities in the Retail category
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.