Fresca PalapaFranchise Cost, Revenue & Review 2026
Data from FDD filing
FranchiseVerdict summary · 2026
A Fresca Palapa franchise requires a total initial investment of $153K – $304K, including a $35K franchise fee and an ongoing 6.0% royalty[2]. Per the 2025 FDD, average unit revenue was $1.2M[2]. Verdict grade: A. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2025 FDD issuance
Overview
- Investment
- $153K – $304K
- 19th pct Service Resta…
- Avg gross sales
- $1.2M
- 40th pct Service Resta…
- Royalty
- 6.0%
- 44th pct Service Resta…
- Units
- 14
- 41st pct Service Resta…
- SBA default
- N/A
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
Each dollar invested generates 5.3x in gross revenue, well above the typical 1.5-2.5x range.
Franchised units fell from 3 to 0 over 3 years. Investigate why operators are leaving.
105% cash-on-cash return (based on P&L Bottom Line). Above the 20% threshold most investors target.
Bottom line
- Total investment $153K – $304K including a $35K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $1.2M/year, with an estimated 105% cash-on-cash return (based on P&L Bottom Line).
- Verdict A (Top Quintile) with a risk score of 20/100.
- Revenue data based on only 1 reporting unit. Treat as directional, not definitive. Ask franchisees directly for current unit economics.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Fresca Palapa Franchising, LLC
- CEO title
- CEO
- Maximo Cruz
- Founder active
- Yes
- Original founder still leading the business
- Incorporated in
- TX
- HQ
- 1812 Corinth Street, Ste 110, Dallas, TX 75215
- Auditor
- A. Andrew Gianiodis
- Audited financials
- Franchisor revenue
- $68K
- vs $177K prior year
Overview
About
Fresca Palapa franchisees operate casual dining establishments or quick-service restaurants featuring fresh, likely Latin/Caribbean-inspired cuisine (palapa theme suggests beachside/tropical positioning). Day-to-day operations include food preparation, inventory management, point-of-sale operations, staffing, and customer service in a fast-casual or counter-service environment.
- CEO
- Maximo Cruz
- Headquarters
- TX
- Founded
- 2022
- FDD year
- 2025
- States available
- 1
FDD Item 7 · 2025 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $35K | $35K |
| Working capital (3–6 mo) | $30K | $50K |
| Equipment, build-out, other | $88K | $219K |
| Total initial investment | $153K | $304K |
Source: Fresca Palapa 2025 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
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
$182K
15.0% margin
Unlevered ROIC
68%
EBITDA / total invested capital
Payback
18 mo
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $153K – $304K
- Better than avg vs category
- Liquid capital req'd
- $30K – $50K
- Below avg, review vs category
- Franchise fee
- $35K – $35K
- Near category avg vs category
- Royalty
- 6.0%
- Gross Sales · typical 6–8%
- Ad fund
- 1.0%
- typical 3–5%
- Total fee load
- 7.0%
- vs 9–13% typical
- Payback period
- 1.0 yrs
- From FDD / Item 19
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 6.0% of gross sales |
| Marketing / ad fund | 1.0% of gross sales |
| Technology fee | $150 |
| Training fee | $350 |
| Transfer fee | $10K |
| Renewal fee | $0 |
| Total fee load | 7.0% of rev |
Financial Performance
- Avg gross sales
- $1.2M
- Per unit, per year
- Median gross sales
- N/A
- Avg p&l bottom line
- $239K
- Reported as P&L Bottom Line in FDD Item 19
- Cash-on-cash
- 104.5%
- Based on P&L Bottom Line / investment midpoint
- Item 19 type
- Kiosk
- Sample size
- 1 units
- vs category median 28 · small
- Reporting year
- 2023
- Fiscal year the figures cover
- Transparency
- 8 / 5
- vs category median 4 / 5 · above
Compared against 453 Quick-Service Restaurants brands
Revenue is 5.3x the investment midpoint. At typical franchise margins, this suggests a payback under 3 years.
vs Quick-Service Restaurants averages
How Fresca Palapa Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 14
- Opened
- 1
- Last reporting year
- Closed
- 0
- Terminated
- 0
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 0.0%
- Company-owned
- 11
- Corporate units in the system
- % franchised
- 21%
- vs corporate-owned
- Net growth (yr3)
- +50.0%
- Net unit change last year
3-year detail · Item 20
- Transfers (3yr)
- 0
- Projected new
- 4
- Franchisor's next-year forecast
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 16 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.
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 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
No SBA loan data available for this brand.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Fresca Palapa presents a cautionary profile with concerning franchisor financial health, rapid unproven growth trajectory, and lack of transparent financial validation—requiring extensive franchisee reference calls before commitment.
Litigation (Item 3)
Item 3 (Litigation) section is blank/not provided. No litigation information disclosed.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · A. Andrew Gianiodis
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
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 20 / 100 rating
- 01HIGHGoing Concern status is False — franchisor may face financial viability issues despite healthy unit economics
- 02MINORExplosive 50% YoY unit growth may indicate unsustainable expansion or inflated recruitment claims rather than organic demand
- 03MEDNo Item 19 financial performance representations disclosed — franchisees cannot independently verify the $238,739 average net income claim
- 04MINORWide investment range ($153,200-$303,900) suggests inconsistent build-out costs or undefined territory sizes, creating unpredictable capital requirements
- 05MINOROnly 14 units system-wide limits franchisee support infrastructure and brand recognition leverage
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 | 10 years |
|---|---|
| Renewal term | 5 years |
| Allowed renewalsℹ | 3 |
| Territory type | Radius |
| Protected territory | Yes |
| Exclusive territoryℹ | Yes |
| Territory population | 50,000 |
| Online sales rights | Granted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 5 mi |
| Right of first refusalℹ | Yes |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Arbitration location | Dallas, Texas |
| Governing law | Texas |
| Litigation count | 0 |
View Item 3 litigation summary
Item 3 (Litigation) section is blank/not provided. No litigation information disclosed.
Items 10, 11
Training & Operations
- Classroom training
- 57 hrs
- On-the-job training
- 34 hrs
- Training location
- Franchisor's facility and on-site
- Ongoing training
- Required
- Time to open
- 5 mo
- From signing to launch
- POS system
- Clover POS
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Clover POS
Item 20 · call current owners
Franchisee Contacts
18 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Fresca Palapa · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Fresca Palapa franchise?
The total investment to open a Fresca Palapa franchise ranges from $153K – $304K, 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 Fresca Palapa franchise owners earn?
According to Item 19 of the Fresca Palapa FDD, the average gross sales per unit is $1.2M. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Fresca Palapa's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Fresca Palapa (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 Fresca Palapa franchise locations are there?
As of their most recent FDD filing, Fresca Palapa has 14 total units in the United States, including 3 franchised units and 11 company-owned units. 1 new units were opened in the latest reporting year.
Is Fresca Palapa a good franchise to buy?
FranchiseVerdict rates Fresca Palapa as a A-grade franchise with a risk score of 20 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.
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.