Feng Cha Franchise Cost, Revenue & Review 2026
- Investment
- $247K – $663K
- Disclosed sales
- not disclosed
- SBA charge-off
- Under 10 loans (5)
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
Feng Cha is a quick-service bubble-tea franchise serving milk teas, fruit teas, and cheese-foam-topped drinks. Franchisees run compact shops managing drink prep, POS, and staffing.
FranchiseVerdict summary · 2026
A Feng Cha franchise requires a total initial investment of $247K – $663K, including a $35K franchise fee and an ongoing 5.0% royalty[2]. This franchisor makes no financial performance representation in Item 19 of its FDD. Item 19 is voluntary under the FTC Franchise Rule, and this filing states that it makes none, so no revenue or earnings figures are disclosed. Declining to publish one is lawful and is not evidence of how the outlets perform. It does mean that less about this brand can be verified from its filing, and the FranchiseVerdict grade - an editorial assessment, not investment advice - reflects that. FranchiseVerdict grade: B (Above average), an editorial assessment, not investment advice. Run a live ROI scan →
Sources, dates and evidence
FDD issued: · Data extracted: · Last cited check: · Staleness risk: medium - issued 12 to 24 months ago; a newer filing is likely on file
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 scored5 of 5 headline figures on this page cite a page of the filing.
Overview
- Investment
- $247K – $663K
- 36th pct Service Resta…
- Avg gross sales
- N/A
- Royalty
- 5.0%
- 12th pct Service Resta…
- Units
- 79
- 73rd pct Service Resta…
- SBA charge-off
- N/A
Quick verdict · Quick-Service Restaurants · color = vs category peers
Green = favorable by >10% vs Quick-Service Restaurants 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 $247K – $663K including a $35K franchise fee, 5.0% ongoing royalty.
- RETURNSThis franchisor makes no financial performance representation in Item 19 of its FDD. Item 19 is voluntary under the FTC Franchise Rule, and this filing states that it makes none, so no revenue or earnings figures are disclosed. Declining to publish one is lawful and is not evidence of how the outlets perform. It does mean that less about this brand can be verified from its filing, and the FranchiseVerdict grade - an editorial assessment, not investment advice - reflects that.
- RISKVerdict B (Above average), verdict score 69/100 (higher is better).
- GROWTHPositive: net +6 franchised outlets in the latest year (15 opened, 9 closed) (Item 20).
- FLAG9 units terminated last reporting year (11.4% of the system). Ask existing franchisees why.
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- Cannect, LLC
- Ultimate parent
- FC USA, LLC
- FDD Item 1, page 7 of the 2025 FDD
- CEO title
- Co-CEO
- Zhongming Gao / Yan Chen
- Founder active
- Yes
- Original founder still leading the business
- Incorporated in
- TX
- HQ
- 412 N. Bowser Rd., Richardson, TX 75081
- Auditor
- AtG LLP
- Audited financials
- Franchisor revenue
- $2.1M
- Most recent fiscal year
- Management churn noted
- Frequent turnover
- Item 2 disclosed frequent executive changes
Overview
About
- CEO
- Zhongming Gao / Yan Chen
- Headquarters
- TX
- Founded
- 2016
- FDD year
- 2025
- States available
- 15
Can you afford it, and what does the money buy?
Entry cost is about typical for a quick-service restaurants franchise (near the category median).
Source: FDD 2025 · Items 5–7
Full Item 7 breakdown14 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Feenot refundable | $35K | $35K | |
| Initial Training Fee (up to three attendees)not refundable | $10K | $10K | |
| Professional Feesnot refundable | $5K | $15K | |
| Equipment, Fixtures, Signs and Technology Materialsnot refundable | $75K | $138K | |
| Leasehold Improvementsnot refundable | $60K | $280K | |
| Signagenot refundable | $5K | $20K | |
| Advertisingnot refundable | $5K | $15K | |
| Franchise Premises Rent and Security Depositnot refundable | $12K | $40K | |
| Initial Inventory of Tea, Coffee, Cups, Menu Boards and Packaging Materialsnot refundable | $19K | $28K | |
| Initial Training Expenses (Travel and Living Expenses)not refundable | $1K | $10K | |
| On-Site Support Expensesnot refundable | $2K | $8K | |
| Insurance - Liability and Worker's Compensation (Initial Deposit)not refundable | $3K | $5K | |
| Miscellaneous Initial Expensesnot refundable | $5K | $10K | |
| Additional Fundsnot refundable | $10K | $50K | |
| Total initial investment | $247K | $663K |
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
- $247K – $663K
- Top 40% of category vs category
- Liquid capital req'd
- $10K – $50K
- Top 40% of category vs category
- Franchise fee
- $35K – $35K
- Middle of category vs category
- Royalty
- 5.0%
- typical 6–8%
- Ad fund
- 1.0%
- typical 3–5%
- Total fee load
- 6.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 5.0% of gross sales |
| Marketing / ad fund | 1.0% of gross sales |
| Technology fee | $350 |
| Training fee | $10K |
| Transfer fee | $18K |
| Renewal fee | $18K |
| Inventory (initial) | $19K – $28K |
| Total fee load | 6.0% of rev |
ROI & LBO modelsSingle-unit · 25-unit portfolio · editable
Feng Cha makes no financial performance representation in Item 19 of its FDD - a voluntary item under the FTC Franchise Rule - so no unit revenue figures are disclosed. The return models need a revenue figure to start from, and the operating costs that turn gross sales into a profit are in no FDD. Enter your own and the calculator runs on your assumptions — nothing here is modelled until you do.
Returns model · single-unit ROIC
What would one Feng Cha 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 annual revenue, 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.
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
No financial performance representation
This franchisor makes no financial performance representation in Item 19 of its FDD. Item 19 is voluntary under the FTC Franchise Rule, and this filing states that it makes none, so no revenue or earnings figures are disclosed. Declining to publish one is lawful and is not evidence of how the outlets perform. It does mean that less about this brand can be verified from its filing, and the FranchiseVerdict grade - an editorial assessment, not investment advice - reflects that.
Item 20 of the FDD lists current and former franchisees; asking them directly is the standard way to fill this gap.
Operator outlook
What the numbers say
Data-driven interpretation of this brand's financial disclosures, fee structure, and system trajectory.
Fee burden
Total ongoing fee load of 6.0% — below the Quick-Service Restaurants median of 7.5%.
Disclosure
This franchisor makes no financial performance representation in Item 19 of its FDD. Item 19 is voluntary under the FTC Franchise Rule, and this filing states that it makes none, so no revenue or earnings figures are disclosed. Declining to publish one is lawful and is not evidence of how the outlets perform. It does mean that less about this brand can be verified from its filing, and the FranchiseVerdict grade - an editorial assessment, not investment advice - reflects that. Item 20 of the FDD lists current and former franchisees; asking them directly is the standard way to fill this gap.
Operator retention
System expanding at 66.0% CAGR over 3 years across 79 units — operators are staying and new ones are joining.
Multi-unit rate
Only 20% of franchisees own multiple units. Could indicate challenging economics or a young system where operators haven't had time to expand.
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 medians
How Feng Cha Compares
Category median of published Quick-Service Restaurants 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 2025 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 79
- Opened
- 15
- Last reporting year
- Closed
- 9
- Terminated
- 9
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 11.4%
- Company-owned
- 1
- Corporate units in the system
- % franchised
- 1%
- vs corporate-owned
- Multi-unit owners
- 20.0%
- Net growth (3-yr)
- +66.0%
- Net unit change over 3 years
- 3-yr CAGR
- +66.0%
- Compounded over last 3 years
Last fiscal year · Item 20 exits and transfers
- Terminated
- 9
- Not renewed
- 0
- Transferred
- 2
- Reacquired
- 0
- Franchisor bought back
- Projected new
- 14
- Franchisor's next-year forecast
- Transfer rate
- 2.5%
- Owners selling to other franchisees
- Termination rate
- 11.4%
- Franchisor-initiated terminations
- Ceased ops
- 11.4%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 12 · 15 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.
15
states with franchisees (per FDD Item 12)
Where the owners are · Item 20 owner list
1 current owner across 1 state.
- TX 1
Counts only, from the list the franchisor prints in Item 20. Names and phone numbers are for your own due diligence and are not shown here.
Fast growth in a small system. Newer franchisors expanding quickly may not yet have the support infrastructure of larger systems.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA loan disclosures. This brand has only 5 7(a) loans on file; statistical reliability is limited below 10 loans.
- Total loans
- 5
- Loan volume
- $4.0M
- Median loan
- $407K
- 50th percentile
- Charge-off rate
- Under 10 loans (5)
- Insufficient SBA coverage: 5 loans, rate hidden below 10
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- Under 10 loans (5)
- 5-yr charge-off
- Under 10 loans (5)
- Loans approved 2021+
- Active lenders
- 3
- Defaults
- N/A
Explore lender portfolios on Bank Reports or regional data on State Reports.
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
Litigation (Item 3)
Subject: officers or affiliates. The franchisor is not a named party in these cases.
No litigation is required to be disclosed in this Item.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · AtG LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Total revenues of $2,092,866 for the year ended December 31, 2024 comprise franchise fee revenue $981,841, royalty and loyalty revenue $781,546, brand development fund revenue $106,598, technology fee revenue $102,340, and other revenue $120,541 (Cannect LLC Statement of Operations).
Supplier relationship · Items 8 & 16
- Franchisor sells you products: Yes
- Kickbacks from required suppliers: No
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 69 / 100 verdict
- 01MEDNo average revenue or net income disclosed (Item 19 absent) — impossible to validate ROI on $246k-$663k investment
- 02MINORSlow unit growth (8.3% YoY) suggests market saturation or franchisee dissatisfaction in tea/beverage category
- 03MINORUnprotected territory creates direct competition risk between franchisees in same market
- 04MED10-year term with no disclosed exit clauses or renewal terms creates long-term commitment uncertainty
- 05MINORHigh relative initial investment ($35k franchise fee) for beverage concept with no performance data to justify it
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 6.0% 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 | 10 years |
|---|---|
| Renewal term | 5 years |
| Allowed renewalsℹ | 1 |
| Territory type | No territory protection |
| Protected territory | No |
| Exclusive territoryℹ | No |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 10 mi |
| Right of first refusalℹ | Yes |
| RoFR response window | 60 days |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Termination groundsℹ | 26 |
| Curable defaultsℹ | 3 |
| Mandatory arbitration | Yes |
| Arbitration location | Dallas County, Texas |
| Jury trial waiver | No |
| Governing law | TX |
| Litigation count | 0 |
View Item 3 litigation summary
No litigation is required to be disclosed in this Item.
Items 10, 11
Training & Operations
- Classroom training
- 85 hrs
- On-the-job training
- 0 hrs
- Training location
- Corporate Headquarters in Dallas, TX area or as designated
- Ongoing training
- Required
- Time to open
- 12 mo
- From signing to launch
- Site selection
- Franchisee with franchisor approval
- Franchisor financing
- Not offered
- Item 10
Items 5 & 11
Franchisor Support
Item 20 · call current owners
Franchisee Contacts
1 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 Feng Cha franchise?
The total investment to open a Feng Cha franchise ranges from $247K – $663K, 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 Feng Cha franchise owners earn?
Feng Cha makes no financial performance representation in Item 19 of its FDD - a voluntary item under the FTC Franchise Rule - so no unit revenue figures are disclosed. Declining to publish one is lawful and is not evidence of how the outlets perform. It does mean that less about this brand can be verified from its filing, and the FranchiseVerdict grade - an editorial assessment, not investment advice - reflects that. Item 20 of the FDD lists current and former franchisees; asking them directly is the standard way to fill this gap.
Who owns Feng Cha?
Feng Cha is franchised by Cannect, LLC. The FDD names no parent company. The ultimate parent named in the FDD is FC USA, LLC. Source: FDD Item 1, 2025 filing.
What is Item 19 in the Feng Cha 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 Feng Cha FDD and qualifies whose outlets they describe.
What is Feng Cha's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Feng Cha (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 Feng Cha franchise locations are there?
As of their most recent FDD filing, Feng Cha has 79 total units in the United States, including 78 franchised units and 1 company-owned units. 15 new units were opened in the latest reporting year.
Is Feng Cha a good franchise to buy?
FranchiseVerdict rates Feng Cha as a B-grade franchise with a verdict score of 69 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 Feng Cha, you can request corrections or provide updated information.
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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.