Fat ShackFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Fat Shack franchise requires a total initial investment of $183K – $488K, including a $35K franchise fee and an ongoing 6.0% royalty[2]. Per the 2026 FDD, average unit revenue was $671K[2]. Verdict grade: A. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2026 FDD issuance
Overview
- Investment
- $183K – $488K
- 27th pct Service Resta…
- Avg gross sales
- $671K
- 18th pct Service Resta…
- Royalty
- 6.0%
- 44th pct Service Resta…
- Units
- 31
- 54th pct Service Resta…
- SBA default
- 0.0%
- 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
The system grew 17% year-over-year. Fast growth means demand, but can strain support.
Bottom line
- Total investment $183K – $488K including a $35K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $671K/year (median $614K).
- Verdict A (Top Quintile) with a risk score of 30/100.
- System growing at 16.7% CAGR over 3 years with 31 total units. Strong expansion trajectory.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Fat Shack Inc.
- Incorporated in
- DE
- HQ
- 420 East 58th Avenue, Suite 128B, Denver, Colorado 80216
- Auditor
- Muhammad Zubairy, CPA PC
- Audited financials
- Franchisor revenue
- $1.5M
- vs $1.5M prior year
Overview
About
Fat Shack franchisees operate quick-service restaurant locations specializing in casual fried/indulgent food offerings (likely sandwiches, sides, beverages). Day-to-day operations include food prep, counter service, inventory management, staffing, and local marketing to drive foot traffic and delivery orders.
- CEO
- Thomas J. Armenti
- Headquarters
- CO
- Founded
- 2013
- FDD year
- 2026
- States available
- 14
FDD Item 7 · 2026 filing · 18 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Feenot refundable | $35K | $35K | |
| Lease Costsnot refundable | $4K | $15K | |
| Space Acquisition and Leasehold Improvementsnot refundable | $50K | $200K | |
| Architectural Design and Professional Feesnot refundable | $3K | $20K | |
| Furnishings and Equipmentnot refundable | $40K | $90K | |
| Signsnot refundable | $5K | $13K | |
| Computer, Software and Office Equipmentnot refundable | $750 | $2K | |
| POS Systemnot refundable | $6K | $12K | |
| Security Surveillance Systemnot refundable | $500 | $4K | |
| Opening Inventory and Suppliesnot refundable | $6K | $15K | |
| Smallwares and Print Materialsnot refundable | $10K | $10K | |
| Security Deposits, Utility Deposits, Business Licensesnot refundable | $3K | $10K | |
| Lease Review Feenot refundable | $0 | $750 | |
| On-Site Opening Assistance Feenot refundable | $0 | $6K | |
| Pre-Opening Hiring and Training of Employeesnot refundable | $3K | $10K | |
| Opening Marketingnot refundable | $1K | $10K | |
| Business Insurancenot refundable | $2K | $6K | |
| Additional Funds - 3 monthsnot refundable | $15K | $30K | |
| Total initial investment | $183K | $488K |
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
$97K
14.5% margin
Unlevered ROIC
27%
EBITDA / total invested capital
Payback
3.7 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $183K – $488K
- Better than avg vs category
- Liquid capital req'd
- $15K – $30K
- Better than avg vs category
- Franchise fee
- $35K – $35K
- Near category avg vs category
- Royalty
- 6.0%
- percentage_of_gross · typical 6–8%
- Ad fund
- 1.5%
- typical 3–5%
- Total fee load
- 7.5%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 6.0% of gross sales |
| Marketing / ad fund | 1.5% of gross sales |
| Transfer fee | $10K |
| Renewal fee | $6K |
| Total fee load | 7.5% of rev |
Financial Performance
- Avg gross sales
- $671K
- Per unit, per year
- Median gross sales
- $614K
- Item 19 type
- gross_sales
- Sample size
- 24 units
- vs category median 28
- Range (low → high)
- $363K→$1.1M
- Cohort dispersion (min → max)
- Quartile band
- $363K→$1.1M
- Bottom 25% → top 25%
- Transparency
- 4 / 5
- vs category median 4 / 5 · typical
Compared against 453 Quick-Service Restaurants brands
vs Quick-Service Restaurants averages
How Fat Shack Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 31
- Opened
- 4
- Last reporting year
- Closed
- 0
- Turnover rate
- 0.0%
- Company-owned
- 3
- Corporate units in the system
- % franchised
- 90%
- vs corporate-owned
- Net growth (yr3)
- +16.7%
- Net unit change last year
- 3-yr CAGR
- +16.7%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 4
- Closed (3yr)
- 0
- Terminated (3yr)
- 1
- Non-renewed (3yr)
- 0
- Transfers (3yr)
- 6
- Reacquired (3yr)
- 0
- Franchisor bought back
- Termination rate
- 4.2%
- Franchisor-initiated terminations
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 9 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 loan disclosures. This brand has only 3 7(a) loans on file; statistical reliability is limited below 10 loans.
- Total loans
- 3
- Loan volume
- $908K
- Median loan
- $240K
- 50th percentile
- Charge-off rate
- 0.0%
- 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)
- 100.0%
- 5-yr charge-off
- 0.0%
- Loans approved 2021+
- Active lenders
- 3
- Defaults
- 0
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Fat Shack's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 3 lenders with concentration factor
- Per-state charge-off rates across 2 states
- Startup risk premium and job creation velocity
- 3-year lending trend
Instant access. No subscription.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Fat Shack presents moderate-to-cautionary risk: healthy growth trajectory and protected territory offset by undisclosed profitability data, small system size, and wide investment variance requiring deeper validation.
Litigation (Item 3)
0 case reference(s): 0 pending, 0 settled.
Largest disclosed settlement: $35,000
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Muhammad Zubairy, CPA PC
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: Yes
- Must buy proprietary products: No
- Restricted to system-approved products: No
Score breakdown · what drove the 30 / 100 rating
- 01MEDNet income not disclosed in FDD Item 19 — impossible to validate profitability claims against $670k average revenue
- 02MINORSmall unit count (31 locations) limits system maturity and reduces franchisee support infrastructure
- 03MINORHigh investment range ($183k-$487k) creates ambiguity; unclear what drives 2.7x cost variance
- 04HIGHGoing Concern flag is FALSE but requires clarification — does franchisor have adequate capitalization and reserves?
- 05MINORModest unit growth (16.7% YoY) is healthy but from tiny base; vulnerable to single-unit closures skewing percentages
- 06HIGHNo litigation disclosed is positive, but small systems often lack visibility into franchisee disputes
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 | 7 years |
|---|---|
| Renewal term | 5 years |
| Allowed renewalsℹ | 3 |
| Territory type | Radius |
| 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 |
| RoFR response window | 30 days |
| Termination notice | 30 days |
| Curable defaultsℹ | 1 |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Governing law | Colorado |
| Litigation count | 0 |
View Item 3 litigation summary
0 case reference(s): 0 pending, 0 settled.
Items 10, 11
Training & Operations
- Classroom training
- 5 hrs
- On-the-job training
- 15 hrs
- Training location
- On-site and corporate
- Franchisor financing
- Offered
- Item 10
- POS system
- Toast POS System
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Toast POS System
Item 20 · call current owners
Franchisee Contacts
33 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Fat Shack · FDD (2026) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Fat Shack franchise?
The total investment to open a Fat Shack franchise ranges from $183K – $488K, 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 Fat Shack franchise owners earn?
According to Item 19 of the Fat Shack FDD, the average gross sales per unit is $671K. The median is $614K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Fat Shack's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Fat Shack (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 Fat Shack franchise locations are there?
As of their most recent FDD filing, Fat Shack has 31 total units in the United States, including 5 franchised units and 3 company-owned units. 4 new units were opened in the latest reporting year.
Is Fat Shack a good franchise to buy?
FranchiseVerdict rates Fat Shack as a A-grade franchise with a risk score of 30 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.