Dairy QueenFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Dairy Queen franchise requires a total initial investment of $623K – $2.8M, including a $25K franchise fee and an ongoing 4.0% royalty[2]. Per the 2026 FDD, average unit revenue was $1.6M[2]. SBA 7(a) loans show a 10.7% charge-off rate across 1,025 loans[1]. Verdict grade: A. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2026 FDD issuance
Overview
- Investment
- $623K – $2.8M
- 88th pct Service Resta…
- Avg gross sales
- $1.6M
- 49th pct Service Resta…
- Royalty
- 4.0%
- 3rd pct Service Resta…
- Units
- 74
- 69th pct Service Resta…
- SBA default
- 10.7%
- system-wide median varies by category
Quick verdict · Quick-Service Restaurants · color = vs category peers
Green = >15% above Quick-Service Restaurants 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
Franchising since 1947. Systems this mature have refined operations and brand recognition.
Franchised units fell from 1952 to 1913 over 3 years. Investigate why operators are leaving.
12 legal cases disclosed in the FDD. Read Item 3 before signing.
Bottom line
- Total investment $623K – $2.8M including a $25K franchise fee, 4.0% ongoing royalty.
- Average unit revenue of $1.6M/year (median $1.5M).
- Verdict A (Top Quintile) with a risk score of 37/100. SBA loan charge-off rate of 10.7% across 1025 loans (above the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2024).
- 12 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
- Dairy Queen Montana / North Dakota LLC
- Incorporated in
- MT
- HQ
- 11300 Chumrau Loop, Missoula, MT 59802
- Auditor
- Lee & Company
- Audited financials
- Franchisor revenue
- $3.5M
- vs $3.8M prior year
Independent franchisee associations
- Franchise Advisory Council (FAC)
Franchisee-led councils or alliances disclosed in Item 20. Indicates operator voice.
Overview
About
Franchisees operate quick-service restaurants serving soft-serve ice cream, blended beverages, and casual food items (Grill & Chill locations). Day-to-day operations include inventory management, staffing, POS systems, food preparation, customer service, and compliance with Dairy Queen brand standards and operational protocols.
- CEO
- James Willis Brown
- Headquarters
- MT
- FDD year
- 2026
- States available
- 2
FDD Item 7 · 2026 filing · 28 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Feenot refundable | $25K | $25K | |
| Management Training Readiness Assessment Feenot refundable | $600 | $600 | |
| Initial Training Feenot refundable | $11K | $11K | |
| SERVSAFE Course | $600 | $1K | |
| Travel and Living Expenses (DQ Treat store trainees) | $8K | $14K | |
| Travel and Living Expenses (DQ Grill & Chill trainees) | $24K | $38K | |
| Building Construction, Site Work and Leasehold Improvements (DQ Treat store in captive-venue) | $259K | $517K | |
| Building Construction, Site Work and Leasehold Improvements (DQ Treat store, street location) | $429K | $957K | |
| Building Construction, Site Work and Leasehold Improvements (DQ Grill & Chill restaurant) | $880K | $1.5M | |
| Prepaid Rent and Security Deposit | $3K | $6K | |
| Building Plans, Design Intent Plans and Architectural Seal (DQ Treat store) | $10K | $50K | |
| Building Plans, Design Intent Plans and Architectural Seal (DQ Grill & Chill) | $15K | $60K | |
| Construction Consultation Servicesnot refundable | $0 | $8K | |
| Equipment and Fixtures (DQ Treat store in captive-venue) | $242K | $396K | |
| Equipment and Fixtures (DQ Treat store with street location) | $396K | $462K | |
| Equipment and Fixtures (DQ Grill & Chill restaurant) | $605K | $770K | |
| Credit Card Processing Fees | $200 | $2K | |
| Training Inventory (DQ Treat store) | $4K | $8K | |
| Training Inventory (DQ Grill & Chill restaurant) | $6K | $12K | |
| Opening Inventory (DQ Treat store) | $5K | $15K | |
| Total initial investment | $3.0M | $5.4M |
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
$242K
15.0% margin
Unlevered ROIC
13%
EBITDA / total invested capital
Payback
7.5 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $623K – $2.8M
- Below avg, review vs category
- Liquid capital req'd
- $40K – $200K
- Below avg, review vs category
- Franchise fee
- $25K – $25K
- Better than avg vs category
- Royalty
- 4.0%
- Gross Sales · typical 6–8%
- Ad fund
- 3.0%
- typical 3–5%
- Total fee load
- 7.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 4.0% of gross sales |
| Marketing / ad fund | 3.0% of gross sales |
| Technology fee | $2K |
| Training fee | $6K |
| Transfer fee | $6K |
| Renewal fee | $4K |
| Inventory (initial) | $9K – $27K |
| Total fee load | 7.0% of rev |
Financial Performance
- Avg gross sales
- $1.6M
- Per unit, per year
- Median gross sales
- $1.5M
- Item 19 type
- gross_sales
- Sample size
- 40 units
- vs category median 28
- Range (low → high)
- $706K→$3.0M
- Cohort dispersion (min → max)
- Transparency tier
- revenue_only
- Categorical assessment of disclosure depth
- Reporting year
- 2024
- Fiscal year the figures cover
- Transparency
- 4 / 5
- vs category median 4 / 5 · typical
Compared against 453 Quick-Service Restaurants brands
Revenue is only 0.9x the investment. This means each unit may take 5+ years to recoup the initial outlay at typical margins.
vs Quick-Service Restaurants averages
How Dairy Queen Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 74
- Opened
- 1
- Last reporting year
- Closed
- 0
- Turnover rate
- 0.0%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (yr3)
- +1.4%
- Net unit change last year
- 3-yr CAGR
- +4.2%
- Compounded over last 3 years
3-year detail · Item 20
- Transfers (3yr)
- 7
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 38 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.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 1,025
- Loan volume
- $317.7M
- Median loan
- $218K
- 50th percentile
- Charge-off rate
- 10.7%
- 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)
- 89.3%
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 272
- Defaults
- 109
Vintage analysis
Dairy Queen charge-off rate by loan vintage
Shaded area: recent vintages with few resolved loans; rates may change as loans mature.
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Dairy Queen'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
- 22-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
Dairy Queen presents caution-level risk due to negligible unit growth, undisclosed profitability metrics, significant franchisor litigation, and unprotected territories that expose franchisees to encroachment and margin compression.
Litigation (Item 3)
8 case reference(s): 1 pending, 0 settled.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Lee & Company
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Must buy proprietary products: No
- Restricted to system-approved products: No
Score breakdown · what drove the 37 / 100 rating
- 01MINORStagnant unit growth of only 1.4% YoY indicates system contraction and poor franchisee recruitment/retention
- 02MINORNo Item 19 (Average Net Income) disclosure prevents validation of $1.62M average revenue translating to actual profitability
- 03HIGHMultiple litigation categories (contract disputes, trademark infringement, encroachment claims) suggest franchisor credibility and operational governance issues
- 04MINORUnprotected territory creates direct competition risk and commoditizes franchisee investments within the same market
- 05MINORHigh investment range ($623K-$2.78M) combined with 4-5% royalties on gross sales offers poor downside protection if revenues underperform
- 06HIGHOfficer litigation history from previous franchise employment raises governance and compliance risk concerns
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 | 20 years |
|---|---|
| Renewal term | 10 years |
| Allowed renewalsℹ | 1 |
| Protected territory | No |
| Online sales rights | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Non-compete (years)ℹ | 1 year |
| Right of first refusalℹ | Yes |
| Termination notice | 30 days |
| Curable defaultsℹ | 3 |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Litigation count | 12 |
View Item 3 litigation summary
8 case reference(s): 1 pending, 0 settled.
Items 10, 11
Training & Operations
- Classroom training
- 32 hrs
- On-the-job training
- 245 hrs
- Training location
- On-site and corporate
- Franchisor financing
- Offered
- Item 10
- POS system
- ParTech
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: ParTech
Item 20 · call current owners
Franchisee Contacts
277 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Dairy Queen · FDD (2026) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Dairy Queen franchise?
The total investment to open a Dairy Queen franchise ranges from $623K – $2.8M, 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 Dairy Queen franchise owners earn?
According to Item 19 of the Dairy Queen FDD, the average gross sales per unit is $1.6M. The median is $1.5M. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Dairy Queen's franchise failure rate?
Based on SBA 7(a) loan data, Dairy Queen has a charge-off rate of 10.7% across 1,025 loans, meaning 10.7% 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 Dairy Queen franchise locations are there?
As of their most recent FDD filing, Dairy Queen has 74 total units in the United States, including 1,952 franchised units and 0 company-owned units. 1 new units were opened in the latest reporting year.
Is Dairy Queen a good franchise to buy?
FranchiseVerdict rates Dairy Queen 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.