Bottom line
- Total investment $21K – $98K including a $8K franchise fee, 20.0% ongoing royalty.
- Average unit revenue of $144K/year (median $119K).
- Rated MODERATE with a risk score of 62/100. SBA loan default rate of 0.0% across 2 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 COLORS ON PARADE unit return on the cash you put in?
Unlevered ROIC · per unit
6%
Below typical band (30–60%)
Overview
About
Colors on Parade franchisees operate a mobile face painting and character entertainment service, traveling to events like birthday parties, festivals, corporate events, and community gatherings. Day-to-day operations involve scheduling appointments, traveling to client locations, applying face paint/makeup, and managing customer relationships. The business model is service-based and highly dependent on personal performance, marketing, and local market saturation.
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 · 10 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
Colors on Parade presents HIGH CAUTION to HIGH RISK due to franchisor going concern issues, undisclosed net income, extremely high royalty rates on modest average revenue, stagnant growth, and unprotected territories.
Score breakdown · what drove the 62 / 100 rating
- 01HIGHGoing Concern status is FALSE — indicates franchisor financial distress or viability concerns
- 02MEDNet income not disclosed in FDD Item 19 — impossible to validate actual profitability claims
- 03MINORExtremely high royalty burden (20-30% of gross) combined with $143.5K avg revenue leaves minimal profit margin (~$28.7K-$57.4K gross after royalties alone)
- 04MINORMinimal system growth (1.8% YoY) with only 223 units — stagnant franchise system
- 05MINORNo territory protection — franchisees face cannibalization risk and direct competition from other franchisees
- 06MINORHigh royalty-to-revenue ratio suggests unit economics may not support franchisee profitability
- 07MINOR20-year term is unusually long and locks franchisees into relationship with struggling franchisor
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
84 numbers
One-time purchase · CSV download · Validation questions included
FDD download
COLORS ON PARADE · FDD (2023) PDF