ClozetivityFranchise Cost, Revenue & Review 2026
Data from FDD filing
FranchiseVerdict summary · 2026
A Clozetivity franchise requires a total initial investment of $82K – $197K, including a $39K franchise fee. Per the 2024 FDD, average unit revenue was $512K[2]. Verdict grade: A. Run a live ROI scan →
Data last verified June 21, 2026 · figures per the 2024 FDD issuance
Overview
- Investment
- $82K – $197K
- 22nd pct Home Services
- Avg gross sales
- $512K
- 17th pct Home Services
- Royalty
- N/A
- Units
- 57
- 44th pct Home Services
- SBA default
- N/A
Quick verdict · Home Services · color = vs category peers
Green = >15% above Home Services 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
Each dollar invested generates 3.7x in gross revenue, well above the typical 1.5-2.5x range.
The system grew 119% year-over-year. Fast growth means demand, but can strain support.
19 legal cases disclosed in the FDD. Read Item 3 before signing.
Bottom line
- Total investment $82K – $197K including a $39K franchise fee.
- Average unit revenue of $512K/year.
- Verdict A (Top Quintile) with a risk score of 37/100.
- 19 litigation matters disclosed in Item 3, higher than typical. Review the summary for patterns (franchisor-initiated vs. franchisee-initiated).
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Clozetivity Holdings, Inc.
- Incorporated in
- NJ
- HQ
- 277 Route 70 STE 227 Toms River, New Jersey 08755
- Auditor
- Salvatore S. Iavarone
- Audited financials
Overview
About
Clozetivity is a closet organization and styling service where franchisees help residential clients redesign, organize, and maximize their closets. Franchisees conduct in-home consultations, handle wardrobe assessment and layout, and may offer personal shopping/styling services. The business model is service-based with travel to client homes and direct sales of organizational products or services.
- CEO
- Leiby “Leo” Goldberger
- Headquarters
- NJ
- Founded
- 2021
- FDD year
- 2024
- States available
- 14
FDD Item 7 · 2024 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $39K | $39K |
| Working capital (3–6 mo) | $15K | $30K |
| Equipment, build-out, other | $28K | $128K |
| Total initial investment | $82K | $197K |
Source: Clozetivity 2024 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
$56K
11.0% margin
Unlevered ROIC
35%
EBITDA / total invested capital
Payback
34 mo
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $82K – $197K
- Better than avg vs category
- Liquid capital req'd
- $15K – $30K
- Better than avg vs category
- Franchise fee
- $39K – $78K
- Better than avg vs category
- Royalty
- Fixed monthly fee: Months 1-6: $400; Months 7-12: $800; M…
- Ad fund
- 2.0%
- typical 3–5%
- Total fee load
- 2.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Marketing / ad fund | 2.0% of gross sales |
| Technology fee | $159 |
| Transfer fee | $13K |
| Renewal fee | $2K |
| Total fee load | 2.0% of rev |
A 2.0% total fee load is unusually lean. More of each revenue dollar stays with the franchisee.
Financial Performance
- Avg gross sales
- $512K
- Per unit, per year
- Median gross sales
- N/A
- Item 19 type
- Revenue
- Sample size
- 11 units
- vs category median 25 · small
- Range (low → high)
- $113K→$2.5M
- Cohort dispersion (min → max)
- Transparency
- 3 / 5
- vs category median 4 / 5 · below
Compared against 349 Home Services brands
vs Home Services averages
How Clozetivity Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 57
- Opened
- 40
- Last reporting year
- Closed
- 9
- Turnover rate
- 15.8%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (yr3)
- +119.2%
- Net unit change last year
3-year detail · Item 20
- Transfers (3yr)
- 0
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 15 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.
Fast growth in a small system. Newer franchisors expanding quickly may not yet have the support infrastructure of larger systems.
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
HIGH RISK: Clozetivity presents a toxic combination of corporate leadership with fraud history, active multi-party litigation alleging fraud and registration violations, undisclosed profitability, and escalating fees on a system showing growth but no transparency regarding franchisee earnings or net income.
Audited financials (Item 21)
Yes · Salvatore S. Iavarone
Score breakdown · what drove the 37 / 100 rating
- 01HIGHCEO has 1999 criminal conviction for credit card fraud, raising integrity concerns for a cash-based closet organization business
- 02HIGHMultiple ongoing lawsuits involving breach of duty, fraud, and registration violations across Clozetivity and affiliated brands (Frost Shades, Dryer Vent Squad, Patch Boys) suggest systemic corporate governance issues
- 03MEDNet income not disclosed despite $512k average revenue claim — inability or unwillingness to provide profitability data is a major transparency red flag
- 04MEDEscalating royalty structure ($400→$2,000/month by year 4) combined with undisclosed net income makes ROI calculation impossible and suggests revenue extraction model
- 05HIGHGoing Concern = False indicates potential financial instability at corporate level despite 119.2% YoY unit growth (which may reflect aggressive recruiting masking unit attrition)
- 06HIGHLitigation involves both franchisees AND affiliated brands, suggesting pattern of disputes with business partners; claims include registration violations (FTC compliance risk)
- 07MINORHigh franchise fee ($39k) + escalating royalties on unknown profitability = aggressive capital extraction with asymmetric information favoring franchisor
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 | 5 years |
| Allowed renewalsℹ | 2 |
| Territory type | Population-based |
| Protected territory | Yes |
| Online sales rights | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Right of first refusalℹ | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Governing law | New Jersey |
| Litigation count | 19 |
Items 10, 11
Training & Operations
- Classroom training
- 15 hrs
- On-the-job training
- 10 hrs
- POS system
- Jobber
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Jobber
Item 20 · call current owners
Franchisee Contacts
25 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Clozetivity · FDD (2024) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Clozetivity franchise?
The total investment to open a Clozetivity franchise ranges from $82K – $197K, with an initial franchise fee of $39K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Clozetivity franchise owners earn?
According to Item 19 of the Clozetivity FDD, the average gross sales per unit is $512K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Clozetivity's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Clozetivity (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 Clozetivity franchise locations are there?
As of their most recent FDD filing, Clozetivity has 57 total units in the United States, including 9 franchised units and 0 company-owned units. 40 new units were opened in the latest reporting year.
Is Clozetivity a good franchise to buy?
FranchiseVerdict rates Clozetivity as a A-grade franchise with a risk score of 37 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.