Clozetivity Franchise Cost, Revenue & Review 2026
- Investment
- $82K – $158K
- Disclosed sales
- $512K
- gross sales, not profit
- SBA charge-off
- Not SBA-matched
Data from FDD filing
Analysis by FranchiseVerdict Research · Methodology
Clozetivity is a home services franchise that designs and installs custom closets and storage systems. Franchisees run local operations, handling in-home design consultations, sales, and installation.
FranchiseVerdict summary · 2026
A Clozetivity franchise requires a total initial investment of $82K – $158K, including a $39K franchise fee. Per the 2024 FDD, average revenue per franchisee was $512K. This franchisor reports Item 19 per franchisee rather than per outlet, so the figure is not comparable with per-outlet averages[2]. FranchiseVerdict grade: A (Strongest tier), an editorial assessment, not investment advice. Run a live ROI scan →
Sources, dates and evidence
FDD issued: · Data extracted: · Last cited check: · Staleness risk: high - issued more than two years ago
Evidence: strong✓ Investment (Item 7)✓ Item 19 status✓ Units and owners (Item 20)✗ SBA loan coverage✓ Litigation (Item 3)✓ Financial statements (Item 21)✓ Franchisor identityhow this is scored4 of 5 headline figures on this page cite a page of the filing; the rest are marked “Not cited” beside the figure.
Overview
- Investment
- $82K – $158K
- 21st pct Home Services
- Avg gross sales
- $512K
- Per franchisee, not per outlet
- Royalty
- Flat fee
- Units
- 57
- 48th pct Home Services
- SBA charge-off
- N/A
Quick verdict · Home Services · color = vs category peers
Green = favorable by >10% vs Home Services median · No shading = within ±10% · Red = unfavorable by >10% · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Bottom line
- COSTTotal investment $82K – $158K including a $39K franchise fee.
- RETURNSAverage revenue per franchisee of $512K/year. Averaged per franchisee, not per outlet - not comparable with per-outlet figures.
- RISKVerdict A (Strongest tier), verdict score 70/100 (higher is better).
- GROWTHPositive: net +31 franchised outlets in the latest year (40 opened, 9 closed) (Item 20).
- FLAG9 units terminated last reporting year (15.8% of the system). Ask existing franchisees why.
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- Clozetivity Franchising, LLC
- CEO title
- Chief Executive Officer
- Leo Goldberger
- Incorporated in
- TN
- HQ
- 1823 Charlotte Avenue, #103, Nashville, Tennessee 37203
- Auditor
- Omar Alnuaimi, CPA
- Audited financials
- Franchisor revenue
- $324K
- Most recent fiscal year
Overview
About
- CEO
- Leo Goldberger
- Headquarters
- TN
- Founded
- 2021
- FDD year
- 2024
- States available
- 14
Can you afford it, and what does the money buy?
Entry cost runs 29% below the typical home services franchise.
Source: FDD 2024 · Items 5–7
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 | $89K |
| Total initial investment | $82K | $158K |
Source: Clozetivity 2024 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $82K – $158K
- Top 40% of category vs category
- Liquid capital req'd
- $15K – $30K
- Top 40% of category vs category
- Franchise fee
- $39K – $39K
- Top 40% of category vs category
- Royalty
- Monthly flat fee: Single Territory: $400 (mo 1-6), $800 (…
- Ad fund
- 0.0%
- typical 3–5%
- Total fee load
- 2.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty (flat) | Monthly Royalty Fee Requirement (tiered by months in operation): Single Territory max $2,000/month; Double Territory max $4,000/month |
| Marketing / ad fund | 0.0% |
| Technology fee | $149 |
| Transfer fee | $5K |
| Renewal fee | $2K |
| Inventory (initial) | $3K – $3K |
| 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.
What do units actually make?
Average unit sales run 13% below the home services norm.
Averaged per franchisee, not per outlet - not comparable with per-outlet figures
Source: FDD 2024 · Item 19
Single-unit · not modelled
Returns at a glance
An FDD discloses gross sales, not profit, and the operating costs that turn one into the other are in no filing. We publish no modelled return for Clozetivity until someone supplies them — yours, in the models below.
—
Not modelled yet
An FDD discloses gross sales, not profit. We hold no sourced figure for royalty rate, COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
Total invested capital · disclosed
$142K
Item 7 initial investment plus working capital, as filed — the one figure here that needs no assumption.
ROI & LBO modelsSingle-unit · 25-unit portfolio · editable
What one unit earns on your invested capital
Model A · Single-Unit Return
Computes unlevered return on invested capital (ROIC) for a single franchise unit, read against the 30–60% reference band · Yale SOM, Post-MBA Path Exhibit 2 (2023). Below that band a passive index fund likely outperforms; above it the franchisor has pricing power you're subsidizing.
Note: Item 19 revenue is what the franchisor discloses, and it is the top line only — gross sales are not profit. No FDD discloses the operating costs that turn one into the other, so those fields start empty and nothing is modelled until you supply them from your own lease quote, labor market and build-out budget.
Returns model · single-unit ROIC
What would one Clozetivity unit return on the cash you put in?
Illustrative category typicals — not sourced to any filing, survey or sample. Replace them with figures from franchisee validation calls before you rely on the output.
Unlevered ROIC · per unit
Your modelled return on total invested capital, before any debt financing.
—
An FDD discloses gross sales, not profit. We hold no sourced figure for royalty rate, COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
What 25 units return when you use SBA financing
Model B · Return on Equity: Debt-Financed Acquisition
Models a 25-unit portfolio acquisition financed with an SBA 7(a) loan. Shows equity IRR (your return on cash invested), DSCR (how safely the cash flow covers debt service), and the capital stack (SBA + seller + equity breakdown).
This is the “search fund” or “entrepreneurship through acquisition” scenario: you buy an existing multi-unit operator, use leverage to amplify returns, and either operate or hire management. The 25-unit size is the typical minimum for an SBA-backed franchise portfolio acquisition to pencil as a full-time income.
What “return on equity” means here: if you put in $500K of your own cash and the business generates enough EBITDA to pay down debt and grow, your equity IRR is the annual return on that $500K, including the value created when you eventually sell. Target IRR for a search fund is typically 25–35%.
Not modelled yet
An FDD discloses gross sales, not profit. We hold no sourced figure for royalty rate, COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
A 25-unit return is built on a per-unit EBITDA. Fill in the operating costs in Model A above and this model runs on that figure, or take the whole scenario to the full ROI workbench, where the portfolio and LBO models accept your own per-unit economics directly.
These models are for research and scenario planning only. Not investment advice. Actual results depend on your specific location, management, and market conditions. Consult a franchise attorney and accountant before signing any franchise agreement.
Item 19 · Source: 2024 FDD
Financial Performance
Averaged per franchisee, not per outlet - not comparable with per-outlet figures
- Avg gross sales
- $512K
- Per franchisee, per year — not per outlet
Gross sales are revenue before expenses — not profit. Actual owner earnings depend on rent, labor, royalties, marketing fees, and debt service.
- Item 19 type
- gross sales
- Sample size
- 11 franchisees
- vs category median 32 · small
- Reporting year
- 2022
- Fiscal year the figures cover
- Source filing
- FDD 2024
- Disclosed in the 2024 filing, covering 2022
- Transparency
- 3 / 10
- vs category median 4 / 10 · below
Compared against 319 Home Services brands
Operator outlook
What the numbers say
Data-driven interpretation of this brand's financial disclosures, fee structure, and system trajectory.
Unit economics
The average franchisee generates $512K/year in gross sales.
Fee burden
Total ongoing fee load of 2.0% — below the Home Services median of 8.0%.
Disclosure
Transparency score 3/10 — moderate disclosure depth. Average and range data are available but detailed cohort breakdowns may be limited.
Source: FDD Item 19 financial performance representations and publicly filed FDD data. Past performance is not indicative of future results. Verify all figures with the franchisor and current franchisees before making any investment decision.
vs Home Services medians
How Clozetivity Compares
Per franchisee, not per outlet - the category median is per-outlet only, so no comparison is shown
Category median of published Home Services brands that report the figure; the middle half spans the 25th to 75th percentile and n counts the brands behind it. Medians are used because a few very large systems pull an average far from the typical brand. Revenue is disclosed gross sales, not profit.
Is the system healthy?
Source: FDD 2024 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 57
- Opened
- 40
- Last reporting year
- Closed
- 9
- Terminated
- 9
- Franchisor ended the franchise (per Item 20)
- Turnover rate
- 15.8%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 92%
- vs corporate-owned
Last fiscal year · Item 20 exits and transfers
- Terminated
- 9
- Signed, not yet open
- 0
- 0.00 per open outlet · Item 20 Table 5
- Projected new
- 20
- Franchisor's next-year forecast
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 12 · 14 states reported
The Territory Map
FDD Item 12 reports the state count, but the specific list isn't in our current data. The map will appear once we re-extract from the FDD or enough franchisee contacts are available.
14
states with franchisees (per FDD Item 12)
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.
What could kill this investment?
Source: SBA 7(a) FOIA · FDD Items 3, 21
Risk analysis
FranchiseVerdict rating + FDD Items 3, 4, 8, 16, 21
Risk & Legal
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.
Litigation (Item 3)
Subject: the franchisor is a named party (defendant).
No litigation required to be disclosed in Item 3.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Omar Alnuaimi, CPA
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
FY2021 (period from inception June 21, 2021 to December 31, 2021); first audited year only. Revenue: Franchise Fees $322,534, Franchise Royalties $800, Other Income $533. Audited by Omar Alnuaimi, CPA (Naper CPA, Naperville, IL).
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
Score breakdown · what drove the 70 / 100 verdict
- 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
- 05HIGHLitigation involves both franchisees AND affiliated brands, suggesting pattern of disputes with business partners; claims include registration violations (FTC compliance risk)
- 06MINORHigh 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
What are you signing up for?
Ongoing fees run about 2.0% of sales (royalty + ad fund), before rent and labor.
Source: FDD 2024 · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 5 years |
| Allowed renewalsℹ | 2 |
| Territory type | Protected territory |
| Protected territory | Yes |
| Exclusive territoryℹ | No |
| Territory population | 300,000 |
| Online sales rights | 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 |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Arbitration location | Davidson County, Tennessee |
| Jury trial waiver | Yes |
| Governing law | TN |
| Litigation count | 0 |
View Item 3 litigation summary
No litigation required to be disclosed in Item 3.
Items 10, 11
Training & Operations
- Classroom training
- 15 hrs
- On-the-job training
- 10 hrs
- Training location
- Nashville, Tennessee
- Ongoing training
- Required
- Time to open
- 1 mo
- From signing to launch
- Site selection
- Franchisee selects, franchisor approves
- Franchisor financing
- Offered
- Item 10
- POS system
- Vonigo
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Vonigo
Item 20 · call current owners
Franchisee Contacts
26 owners to call
Name · phone · city · state. Extracted from FDD Item 20
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 – $158K, 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. Important context: Averaged per franchisee, not per outlet - not comparable with per-outlet figures. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
Who owns Clozetivity?
Clozetivity is franchised by Clozetivity Franchising, LLC. Source: FDD Item 1, 2024 filing.
What is Item 19 in the Clozetivity FDD?
The FDD section where a franchisor may disclose financial performance of its outlets. Disclosure is optional and formats vary; figures are typically gross sales, which is revenue before expenses, not profit. FranchiseVerdict extracts these figures directly from the Clozetivity FDD and qualifies whose outlets they describe.
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 57 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 verdict score of 70 out of 100 (higher is better). The grade is a deterministic score built from six weighted dimensions — financial health, unit economics, unit growth, scale, legal, and transparency — then calibrated against SBA loan charge-off rates and FDD age. Transparency is one of the six, so a filing that discloses less scores lower on that dimension than one that discloses more. 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 Clozetivity, you can request corrections or provide updated information.
Other Home Services franchises
Compare similar franchise opportunities in the Home Services 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.