Del Taco Franchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
Del Taco is a quick-service franchise serving value-priced Mexican fare, tacos, burritos, and fries, alongside American items like burgers and shakes. Franchisees run restaurants with drive-thru and counter service, managing food prep, staffing, and costs.
FranchiseVerdict summary · 2026
A Del Taco franchise requires a total initial investment of $1.5M – $3.3M, including a $35K franchise fee and an ongoing 5.0% royalty[2]. Per the 2025 FDD, average unit revenue was $1.6M[2]. SBA 7(a) loans show a 18.9% charge-off rate across 50 loans[1]. FranchiseVerdict grade: B (Above average), an editorial assessment, not investment advice. Run a live ROI scan →
Data last verified · figures per the 2025 FDD issuance
Overview
- Investment
- $1.5M – $3.3M
- 98th pct Service Resta…
- Avg gross sales
- $1.6M
- Outlet subset27th pct Service Resta…
- Royalty
- 5.0%
- 11th pct Service Resta…
- Units
- 594
- 90th pct Service Resta…
- SBA charge-off
- 18.9%
- % of SBA 7(a) loans not repaid · median varies by category
Quick verdict · Quick-Service Restaurants · color = vs category peers
Green = favorable by >10% vs Quick-Service Restaurants avg · 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 $1.5M – $3.3M including a $35K franchise fee, 5.0% ongoing royalty.
- RETURNSAverage unit revenue of $1.6M/year (median $1.5M) (reported for a subset of outlets rather than the whole system).
- RISKVerdict B (Above average), verdict score 51/100 (higher is better). SBA loan charge-off rate of 18.9% across 50 loans (above the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2025).
- FLAGBankruptcy history disclosed in the FDD. Review Item 4 for details before proceeding.
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- Del Taco LLC
- Parent company
- Del Taco Holdings, Inc.
- Ultimate parent
- Jack in the Box Inc.
- CEO title
- Brand President
- Tom Rose
- Incorporated in
- CA
- HQ
- 25521 Commercentre Drive, Suite 150, Lake Forest, California 92630
- Auditor
- KPMG LLP
- Audited financials
- Franchisor revenue
- $1.7M
- vs $1.6M prior year
Independent franchisee associations
- Franchise Advisory Council (FAC)
Franchisee-led councils or alliances disclosed in Item 20. Indicates operator voice.
Affiliated brands
- Jack in the Box Properties
- Different Rules
Other brands the franchisor or its parent operates (Item 1).
Overview
About
- CEO
- Tom Rose
- Headquarters
- CA
- Founded
- 1988
- FDD year
- 2025
- States available
- 16
Can you afford it, and what does the money buy?
Entry cost runs 266% above the typical quick-service restaurants franchise.
Source: FDD 2025 · Items 5–7
Full Item 7 breakdown37 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Franchise Feenot refundable | $35K | $35K | |
| Promotional Feenot refundable | $10K | $10K | |
| Land | — | — | |
| Fee for Architectural and Engineering and other Related Consultant Services | $27K | $124K | |
| Environmental Assessment | $3K | $34K | |
| On-site Improvements | $186K | $650K | |
| Building Improvements | $490K | $1.2M | |
| Furnishings, Fixtures and Equipment | $400K | $750K | |
| IT Equipment & Installation, Computer-related Services & Licensing | $59K | $100K | |
| Security Cameras | $6K | $8K | |
| Technical Support Expensesnot refundable | $2K | $4K | |
| Initial Training Expenses | $194K | $253K | |
| Crew Training Expenses | $48K | $68K | |
| Additional Funds - 3 Months | $28K | $65K | |
| Inventory | $7K | $7K | |
| Licenses, Fees and Deposits | $3K | $6K | |
| Fee for trade area survey analysisnot refundable | $0 | $8K | |
| Development Feenot refundable | $45K | $45K | |
| Professional Fee | $1K | $5K | |
| Remaining Franchise Feenot refundable | $25K | $25K | |
| Total initial investment | $2.6M | $6.2M |
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.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $1.5M – $3.3M
- Bottom third — review vs category
- Liquid capital req'd
- $28K – $65K
- Middle of category vs category
- Franchise fee
- $35K – $35K
- Middle of category vs category
- Royalty
- 5.0%
- percentage · typical 6–8%
- Ad fund
- 4.0%
- typical 3–5%
- Total fee load
- 9.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 5.0% of gross sales |
| Marketing / ad fund | 4.0% of gross sales |
| Technology fee | $173 |
| Transfer fee | $5K |
| Renewal fee | $35K |
| Inventory (initial) | $7K – $7K |
| Total fee load | 9.0% of rev |
What do units actually make?
Average unit sales run 33% above the quick-service restaurants norm.
Reported for a subset of outlets rather than the whole system
Source: FDD 2025 · Item 19
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
$210K
13.0% margin
Unlevered ROIC
9%
EBITDA / total invested capital
Payback
11.7 yrs
cash-on-cash, unlevered
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. The target band for an attractive franchise is 30–60% ROIC. Below that and a passive index fund likely outperforms; above that and the franchisor has pricing power you're subsidizing.
Note: Item 19 revenue is what the franchisor discloses. It's the top line only. Operating costs below are category estimates. Override them to match your real lease quote, labor market, and build-out budget.
Returns model · single-unit ROIC
What would one Del Taco unit return on the cash you put in?
Unlevered ROIC · per unit
Estimated return on your total franchise investment, before any debt financing.
9%
Below the 30–60% attractive-franchise band
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%.
Levered LBO scenario · Yale Crease Capital framing
What would 25 Del Taco units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$1.9M
on $9.7M purchase
Total debt
$7.7M
SBA $4.8M + senior + seller note
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: 2025 FDD
Financial Performance
Reported for a subset of outlets rather than the whole system
- Avg gross sales
- $1.6M
- Per unit, per year
- Median gross sales
- $1.5M
Gross sales are revenue before expenses — not profit. Actual owner earnings depend on rent, labor, royalties, marketing fees, and debt service.
- Item 19 type
- average sales
- Sample size
- 387
- vs category median 20 · large
- Range (low → high)
- $380K→$6.9M
- Cohort dispersion (min → max)
- Reporting year
- 2024
- Fiscal year the figures cover
- Source filing
- FDD 2025
- Disclosed in the 2025 filing, covering 2024
- Transparency
- 9 / 10
- vs category median 4 / 10 · above
Compared against 782 Quick-Service Restaurants brands
Revenue is only 0.7x the investment. This means each unit may take 5+ years to recoup the initial outlay at typical margins.
Operator outlook
What the numbers say
Data-driven interpretation of this brand's financial disclosures, fee structure, and system trajectory.
Unit economics
Average unit generates $1.6M/year in gross sales. Revenue-to-investment ratio: 0.7x. Reported for a subset of outlets rather than the whole system.
Fee burden
Total ongoing fee load of 9.0% (near the Quick-Service Restaurants average).
Disclosure
Transparency score 9/10 — this franchisor discloses detailed breakdowns (quartiles, segments, or cohort data). Buyers can model unit economics with higher confidence.
Operator retention
System expanding at 53.2% CAGR over 3 years across 594 units — operators are staying and new ones are joining.
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 Quick-Service Restaurants averages
How Del Taco Compares
Is the system healthy?
Source: FDD 2025 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 594
- Opened
- 58
- Last reporting year
- Closed
- 9
- Turnover rate
- 2.0%
- Company-owned
- 133
- Corporate units in the system
- % franchised
- 78%
- vs corporate-owned
- Net growth (3-yr)
- +53.2%
- Net unit change over 3 years
- 3-yr CAGR
- +53.2%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 58
- Closed (3yr)
- 9
- Terminated (3yr)
- 0
- Non-renewed (3yr)
- 0
- Transfers (3yr)
- 32
- Reacquired (3yr)
- 9
- Franchisor bought back
- Transfer rate
- 1.6%
- Owners selling to other franchisees
- Ceased ops
- 0.2%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 11 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
- 50
- Loan volume
- $46.7M
- Median loan
- $777K
- 50th percentile
- Charge-off rate
- 18.9%
- 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)
- 81.1%
- 5-yr charge-off
- 0.0%
- Loans approved 2021+
- Active lenders
- 31
- Defaults
- 7
- Typical loan rate
- 6.6%
- avg rate to borrowers
- Franchised industry avg
- 10.8%
- brand above franchise avg ↑
- Jobs supported
- 1,428
- 3.1 per loan
- Lender concentration
- 10%
- top lender's share
Borrower mix: 73% went to startups / new businesses, 27% to established operators
Franchise vs independent — in limited-service restaurants, franchised businesses charge off at 10.8% vs 10.0% for independents — franchising is associated with 8% higher SBA default risk in this category.
Vintage analysis
Del Taco charge-off rate by loan vintage
Top lenders financing Del Taco franchisees
Showing 3 of 31 lenders. The full breakdown — every lender, state distribution, interest rates & risk ratings — is in the SBA Lending Report below.
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Del Taco'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 10 states
- Startup risk premium and job creation velocity
- 25-year lending trend
- SBA 504 real estate/equipment data
Instant access. No subscription.
What could kill this investment?
SBA loans charge off at 18.9% — 18% above the 16.0% national norm, i.e. higher lender-observed risk.
Source: SBA 7(a) FOIA · FDD Items 3, 21
Risk analysis
FranchiseVerdict rating + FDD Items 3, 4, 8, 16, 21
Risk & Legal
Del Taco presents a CAUTION-level risk profile due to active litigation involving franchise operations, marketing fund governance, and consumer deception claims, combined with modest unit growth and lack of Item 19 disclosure, offsetting otherwise reasonable unit economics.
Litigation (Item 3)
Pending: Philippines franchise case (decided in company's favor, appeal possible); Garner v. JIB (breach of franchise agreements, jury awarded $8M but court granted post-trial motion for nothing); AJP Enterprises v. JIB (termination of 47 restaurants, initial stages). Concluded: Torrez v. Del Taco LLC ($50M wage class action settlement, final accounting pending); Castillo v. Del Taco LLC (data breach settled 2023).
Largest disclosed settlement: $50,000,000
Bankruptcy (Item 4)
Disclosed in last 7 years
GNC Holdings, Inc. filed Chapter 11 bankruptcy on June 23, 2020 while Ryan Ostrom (now Del Taco Chief Brand Officer) and Steven Piano (now Chief People Officer) were employed there. Plan confirmed October 14, 2020.
Audited financials (Item 21)
Yes · KPMG LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
ⓘ These are the parent company's consolidated financials (the parent guarantees the franchisor), not this brand's standalone results — the figure reflects the whole corporate group, not this brand alone.
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Kickbacks from required suppliers: Yes
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
Score breakdown · what drove the 51 / 100 verdict
- 01HIGHSignificant litigation portfolio spanning wage violations, data breaches, franchise agreement disputes, and marketing fund mismanagement—indicating systemic operational and legal governance issues
- 02MINORMultiple lawsuits alleging deceptive advertising regarding ingredients creates reputational risk and potential regulatory exposure that could impact customer trust and sales
- 03MINORModest unit growth of 9.5% YoY combined with 594 total units suggests a mature/plateauing system; growth rate insufficient to indicate strong franchise model expansion
- 04HIGHLitigation related to alleged mismanagement of marketing funds raises questions about how the 5% royalty is being deployed and whether franchisees receive adequate return on mandatory contributions
- 05MEDHigh initial investment range ($1.5M–$3.3M) paired with average net income of $383K yields ROI of 11.5%–25.5%, which is acceptable but leaves limited margin for error given operational risks
- 06MINORAbsence of Item 19 financial performance representations limits ability to validate whether the $1.6M average revenue and $383K net income figures are achievable or cherry-picked
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 9.0% of sales (royalty + ad fund), before rent and labor.
Source: FDD 2025 · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 20 years |
|---|---|
| Renewal term | 20 years |
| Allowed renewalsℹ | 1 |
| Territory type | protected |
| Protected territory | Yes |
| Exclusive territoryℹ | No |
| Territory radius | 1 mi |
| Online sales rightsℹ | Granted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 2 mi |
| Right of first refusalℹ | Yes |
| RoFR response window | 30 days |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Termination groundsℹ | 1 |
| Curable defaultsℹ | 2 |
| Mandatory arbitration | Yes |
| Arbitration location | Orange County, California |
| Jury trial waiver | No |
| Governing law | CA |
| Litigation count | 4 |
View Item 3 litigation summary
Pending: Philippines franchise case (decided in company's favor, appeal possible); Garner v. JIB (breach of franchise agreements, jury awarded $8M but court granted post-trial motion for nothing); AJP Enterprises v. JIB (termination of 47 restaurants, initial stages). Concluded: Torrez v. Del Taco LLC ($50M wage class action settlement, final accounting pending); Castillo v. Del Taco LLC (data breach settled 2023).
Items 10, 11
Training & Operations
- Classroom training
- 48 hrs
- On-the-job training
- 400 hrs
- Training location
- Nearest Certified Training Restaurant
- Ongoing training
- Required
- Time to open
- 3 mo
- From signing to launch
- Site selection
- franchisee with franchisor approval
- Franchisor financing
- Not offered
- Item 10
- POS system
- ULTRABOS
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: ULTRABOS
Item 20 · call current owners
Franchisee Contacts
18 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Del Taco · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Del Taco franchise?
The total investment to open a Del Taco franchise ranges from $1.5M – $3.3M, with an initial franchise fee of $35K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Del Taco franchise owners earn?
According to Item 19 of the Del Taco FDD, the average gross sales per unit is $1.6M. The median is $1.5M. Important context: Reported for a subset of outlets rather than the whole system. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Item 19 in the Del Taco 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 Del Taco FDD and qualifies whose outlets they describe.
What is Del Taco's franchise failure rate?
Based on SBA 7(a) loan data, Del Taco has a charge-off rate of 18.9% across 50 loans, meaning 18.9% 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 Del Taco franchise locations are there?
As of their most recent FDD filing, Del Taco has 594 total units in the United States, including 461 franchised units and 133 company-owned units. 58 new units were opened in the latest reporting year.
Is Del Taco a good franchise to buy?
FranchiseVerdict rates Del Taco as a B-grade franchise with a verdict score of 51 out of 100 (higher is better), 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
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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.