Friendly’s Franchise Cost, Revenue & Review 2026
- Investment
- $1.1M – $2.7M
- Disclosed sales
- partial, no system average
- SBA charge-off
- 6.5%
- on 37 loans
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
Friendly's is a family-dining franchise pairing all-day American comfort food with its signature ice cream and sundaes. Franchisees run full-service restaurants managing kitchen, ice-cream service, and staff.
FranchiseVerdict summary · 2026
A Friendly’s franchise requires a total initial investment of $1.1M – $2.7M, including a $15K – $30K franchise fee and an ongoing 6.0% royalty[2]. The 2025 FDD on file does not yield a unit-revenue figure we can publish. SBA 7(a) loans show a 6.5% charge-off rate across 37 loans[1]. 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
- $1.1M – $2.7M
- 34th pct Service Resta…
- Avg gross sales
- N/A
- Royalty
- 6.0%
- 25th pct Service Resta…
- Units
- 95
- 31st pct Service Resta…
- SBA charge-off
- 6.5%
- % of SBA 7(a) loans not repaid · median varies by category
Quick verdict · Full-Service Restaurants · color = vs category peers
Green = favorable by >10% vs Full-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 $1.1M – $2.7M including a $30K franchise fee, 6.0% ongoing royalty.
- RETURNSItem 19 reports outlet revenue, but not in a form that yields a per-outlet average we can compare across brands.
- RISKVerdict B (Above average), verdict score 66/100 (higher is better). SBA loan charge-off rate of 6.5% across 37 loans (near or below the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2025).
- GROWTHPositive: net +8 franchised outlets in the latest year (13 opened, 4 closed) (Item 20).
- 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
- Friendly's Restaurants Franchising Co, LLC
- Parent company
- Friendly's Restaurants Group, LLC
- FDD Item 1, page 6 of the 2025 FDD
- Ultimate parent
- Legacy Brands International, LLC
- FDD Item 1, page 6 of the 2025 FDD
- Predecessor
- Friendly's Franchising LLC
- Prior franchisor entity
- CEO title
- Chief Executive Officer
- Sherif Mityas
- Incorporated in
- TX
- HQ
- 14860 Montfort Drive, Suite 150 PMB 34, Dallas, Texas 75254
- Auditor
- A&G LLP
- Audited financials
- Franchisor revenue
- $10.6M
- vs $6.9M prior year
Independent franchisee associations
- Franchise Advisory Council (FAC)
Franchisee-led councils or alliances disclosed in Item 20. Indicates operator voice.
Affiliated brands
- CJ Fresh Holdings FC
Other brands the franchisor or its parent operates (Item 1).
Same owner · FDD Item 1, page 6
2 other brands on this site name Legacy Brands International, LLC as parent or ultimate parent in their own FDD.
Grouped by the owner's name as each filing prints it (this page: the 2025 FDD). Spelling variants of the same group may be listed apart; a brand is never grouped with an owner its filing does not name.
Overview
About
- CEO
- Sherif Mityas
- Headquarters
- TX
- Founded
- 1935
- FDD year
- 2025
- States available
- 11
Can you afford it, and what does the money buy?
Entry cost runs 180% above the typical full-service restaurants franchise.
Source: FDD 2025 · Items 5–7
Full Item 7 breakdown15 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Fee | $30K | $30K | |
| Site Selection Fee | $4K | $4K | |
| Project Management Fee | $4K | $4K | |
| Lease, Deposits & Rent | $25K | $50K | |
| Architect; Engineer; Drawings | $16K | $30K | |
| Construction of Restaurant (excluding malls) | $400K | $1.6M | |
| Furniture, Equipment, Signs and Computers | $328K | $460K | |
| Grand Opening Campaign | $10K | $10K | |
| Miscellaneous Pre-Opening Expenses | $13K | $37K | |
| Insurance (3 months) | $6K | $8K | |
| Inventory of Food, Supplies, Small-wares and Uniforms | $39K | $65K | |
| Transportation and Living Expenses for Your Management Team's Initial Training | $10K | $34K | |
| Opening Team Expenses | $25K | $79K | |
| Professional Fees | $2K | $6K | |
| Additional Funds for 3 Months of Operation | $200K | $300K | |
| Total initial investment | $1.1M | $2.7M |
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
- $1.1M – $2.7M
- Top 40% of category vs category
- Liquid capital req'd
- $200K – $300K
- Top 40% of category vs category
- Franchise fee
- $15K – $30K
- Top 40% of category vs category
- Royalty
- 6.0%
- typical 6–8%
- Ad fund
- 2.5%
- typical 3–5%
- Total fee load
- 8.5%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 6.0% of net sales |
| Marketing / ad fund | 2.5% of net sales |
| Technology fee | $2K |
| Training fee | $10K |
| Transfer fee | $10K |
| Renewal fee | $15K |
| Inventory (initial) | $39K – $65K |
| Total fee load | 8.5% of rev |
What do units actually make?
Source: FDD 2025 · Item 19
ROI & LBO modelsSingle-unit · 25-unit portfolio · editable
No Item 19 revenue figure for Friendly’s is on file. 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 Friendly’s 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
- Item 19 type
- gross sales
- Sample size
- 93
- vs category median 18 · large
- Quartile band
- $879K→$2.0M
- Bottom 25% → top 25%
- Reporting year
- 2024
- Fiscal year the figures cover
- Source filing
- FDD 2025
- Disclosed in the 2025 filing, covering 2024
Compared against 801 Full-Service Restaurants brands
Item 19 · by group
What the filing does disclose
Item 19 of this FDD reports performance in more than one group. We publish no single average for this brand; the groups the filing does disclose are listed below, quoted from its own Item 19 table.
Each row below is quoted from the FDD's own Item 19 table. Gross sales are not profit.
Item 19 detail
By quartile
| Segment | Sample | Avg |
|---|---|---|
| Top 25% | 23 | $2.0M |
| Bottom 25% | 24 | $879K |
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 8.5% — above the Full-Service Restaurants median of 7.0%.
Disclosure
Item 19 reports outlet revenue, but not in a form that yields a per-outlet average we can compare across brands.
Operator retention
System expanding at 95.8% CAGR over 3 years across 95 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 Full-Service Restaurants medians
How Friendly’s Compares
Category median of published Full-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
- 95
- Opened
- 13
- Last reporting year
- Closed
- 4
- Turnover rate
- 5.3%
- Company-owned
- 1
- Corporate units in the system
- % franchised
- 99%
- vs corporate-owned
- Net growth (3-yr)
- +95.8%
- Net unit change over 3 years
- 3-yr CAGR
- +95.8%
- Compounded over last 3 years
Last fiscal year · Item 20 exits and transfers
- Signed, not yet open
- 0
- 0.00 per open outlet · Item 20 Table 5
- Projected new
- 0
- Franchisor's next-year forecast
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 12 · 11 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.
11
states with franchisees (per FDD Item 12)
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.
- Total loans
- 37
- Loan volume
- $25.5M
- Median loan
- $875K
- 50th percentile
- Charge-off rate
- 6.5%
- on 37 loans · 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)
- 91.7%
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 16
- Defaults
- 2
- Typical loan rate
- 5.9%
- avg rate to borrowers
- vs industry
- N/A
- NAICS 7221
- Jobs supported
- 2,495
- 11.4 per loan
- Lender concentration
- 15%
- top lender's share
Borrower mix: 0% went to startups / new businesses, 100% to established operators
Vintage analysis
Friendly’s charge-off rate by loan vintage
Top lenders financing Friendly’s franchisees
Showing 3 of 16 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.
What could kill this investment?
SBA loans charge off at 6.5% — 59% below the 16.0% national norm, i.e. lower 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
Friendly's presents elevated risk due to a contracting unit base, opaque unit economics, material litigation history, and undisclosed profitability—making it difficult to validate ROI justification for $1.1M–$2.7M investment.
Why this reads harsher than the B grade: the grade weighs financial health, unit economics, unit growth, scale, legal, and transparency across the whole filing, while this summary lists individual flags without that weighting. The flags are worth checking with current owners; neither is investment advice.
Litigation (Item 3)
Subject: the franchisor is a named party (defendant).
1. Franchisor vs. J&B Restaurant Partners et al (Index No. 650080/2023): Settled July 2023 after franchise terminations and declaratory judgment action regarding lease assignments and collateral. 2. SEC v. Sherif Mityas (12-cv-1281): CEO consented to Final Judgment in 2012 for securities violation (Rule 10b-5).
Bankruptcy (Item 4)
Subject: the company or an affiliate. Disclosed (Item 4 covers the last 10 years)
Predecessor entities (Neapolitan Group Holdings, LLC; FIC Holdings, LLC; FIC Restaurants, Inc.; Friendly's Restaurants, LLC; Friendly's Franchising LLC) filed Chapter 11 in 2020 (Docket 20-12807-CSS), assets acquired by APG.
Audited financials (Item 21)
Yes · A&G LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
FY2024 (year ended December 29, 2024) audited. Total revenues comprise franchise fees $39,312, royalties $7,029,037, marketing fund revenue $3,518,501, and other revenue $53,467. Prior-year FY2023 (ended Dec 31, 2023) total revenues $6,921,240. FY2022 (ended Jan 1, 2023) total revenues $9,130,607 audited by another auditor.
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
Score breakdown · what drove the 66 / 100 verdict
- 01MEDSignificant unit contraction: 95 units represents declining system with only 9.3% YoY growth, suggesting maturity or decline phase
- 02MEDHigh initial investment ($1.1M–$2.7M) paired with undisclosed profitability creates asymmetric risk
- 03HIGHLitigation history including asset/lease disputes with franchisees and SEC judgment against CEO raises governance concerns
- 04MINOR6% royalty on net sales with high capex requirements typical of casual dining creates margin pressure in low-AUV environments
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 8.5% 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 | 10 years |
| Allowed renewalsℹ | 1 |
| Territory type | Protected territory |
| Protected territory | Yes |
| Exclusive territoryℹ | No |
| Territory radius | 1 mi |
| Online sales rights | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 15 mi |
| Right of first refusalℹ | Yes |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Curable defaultsℹ | 3 |
| Mandatory arbitration | No |
| Arbitration location | Dallas, Texas |
| Jury trial waiver | No |
| Governing law | TX |
| Litigation count | 2 |
View Item 3 litigation summary
1. Franchisor vs. J&B Restaurant Partners et al (Index No. 650080/2023): Settled July 2023 after franchise terminations and declaratory judgment action regarding lease assignments and collateral. 2. SEC v. Sherif Mityas (12-cv-1281): CEO consented to Final Judgment in 2012 for securities violation (Rule 10b-5).
Items 10, 11
Training & Operations
- Classroom training
- 13 hrs
- On-the-job training
- 186 hrs
- Training location
- Certified training restaurant
- Ongoing training
- Required
- Time to open
- 12 mo
- From signing to launch
- Franchisor financing
- Not offered
- Item 10
- POS system
- Revel Systems
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Revel Systems
Item 20 · call current owners
Franchisee Contacts
51 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 Friendly’s franchise?
The total investment to open a Friendly’s franchise ranges from $1.1M – $2.7M, with an initial franchise fee of $30K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Friendly’s franchise owners earn?
Item 19 of the Friendly’s FDD discloses figures for part of the system but no single average across all outlets. These are gross sales figures, not profit; the Revenue section shows what the filing reports and on what basis. Item 20 of the FDD lists current and former franchisees; asking them directly is the standard way to fill this gap.
Who owns Friendly’s?
Friendly’s is franchised by Friendly's Restaurants Franchising Co, LLC. Its parent company is Friendly's Restaurants Group, LLC. The ultimate parent named in the FDD is Legacy Brands International, LLC. Source: FDD Item 1, 2025 filing.
What is Item 19 in the Friendly’s 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 Friendly’s FDD and qualifies whose outlets they describe.
What is Friendly’s's franchise failure rate?
Based on SBA 7(a) loan data, Friendly’s has a charge-off rate of 6.5% across 37 loans, meaning 6.5% 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 Friendly’s franchise locations are there?
As of their most recent FDD filing, Friendly’s has 95 total units in the United States, including 94 franchised units and 1 company-owned units. 13 new units were opened in the latest reporting year.
Is Friendly’s a good franchise to buy?
FranchiseVerdict rates Friendly’s as a B-grade franchise with a verdict score of 66 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
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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.