Bottom line
- Total investment $188K – $507K including a $20K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $476K/year (median $444K).
- Rated MODERATE with a risk score of 64/100. SBA loan default rate of 0.0% across 19 loans (below the industry average).
- Auditor disclosed a going-concern note — flagged doubt about the franchisor's ability to continue operations. Verify against the latest FDD.
Item 1 · who you're contracting with
The Franchisor
Yale framework · single-unit ROIC
Returns Analysis
Pulls Item 7 (investment) and Item 19 (revenue) from this brand's FDD into the Yale unlevered-ROIC formula. Override any input to stress-test it against your own assumptions.
The model · Yale framework
What would one GNC unit return on the cash you put in?
Unlevered ROIC · per unit
27%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 GNC units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$1.3M
on $6.7M purchase
Total debt
$5.3M
SBA $3.3M + senior + seller note
Overview
About
GNC franchisees operate retail supplement and health product storefronts, managing inventory of vitamins, minerals, sports nutrition, and wellness products. Daily operations include customer consultation and sales, inventory management, point-of-sale transactions, and compliance with product labeling and marketing claims. Franchisees pay 6% of gross sales as royalties regardless of profitability.
Item 7 · what it costs
The Vitals
Item 19
Financial Performance
Item 20 · unit dynamics
The Growth Chart
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 5 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 phone area codes (Item 20). Approximate — ported numbers may show the original state, not the franchisee's current location.
Government records
SBA Loan Data
Aggregated from SBA 7(a) loan disclosures, public data unique to FranchiseVerdict.
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
GNC presents high investment risk due to a contracting franchise system, multiple active litigations involving employment and consumer issues, undisclosed profitability metrics, and franchisor going concern status that threatens long-term operational support.
Score breakdown · what drove the 64 / 100 rating
- 01MINORSystem declining 6.3% YoY with 2,140 units suggests market contraction and potential viability concerns
- 02HIGHNumerous active litigations across trademark, employment, and consumer class actions indicate systemic operational and compliance issues
- 03HIGHGoing concern status raises questions about franchisor's financial stability and ability to support franchisees long-term
- 04MEDNo disclosed average net income creates opacity around actual profitability; $475K revenue with 6% royalty leaves unclear margins after COGS
- 05HIGHHigh litigation frequency (especially wage/hour and product labeling) suggests compliance challenges that could affect franchisee liability exposure
- 06MINOR5-year term is relatively short; combined with declining unit count, indicates potential challenges renewing or growing territory
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
Item 11
Training & Operations
Item 20
Franchisee Contacts
Phone numbers extracted directly from this brand's FDD Item 20. After purchase, you'll also receive a list of validation questions tailored to this brand.
Franchisee contacts
100 numbers
One-time purchase · CSV download · Validation questions included
FDD download
GNC · FDD (2025) PDF