Great Steak Franchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
Great Steak is a quick-service franchise known for Philly cheesesteaks, fries, and sandwiches, often in mall food courts. Franchisees run the locations, managing food prep, staffing, and counter service.
FranchiseVerdict summary · 2026
A Great Steak franchise requires a total initial investment of $173K – $663K, including a $30K franchise fee and an ongoing 6.0% royalty[2]. Per the 2025 FDD, average unit revenue was $580K[2]. SBA 7(a) loans show a 28.8% charge-off rate across 75 loans[1]. FranchiseVerdict grade: C (Average), an editorial assessment, not investment advice. Run a live ROI scan →
Data last verified · figures per the 2025 FDD issuance
Overview
- Investment
- $173K – $663K
- 17th pct Service Resta…
- Avg gross sales
- $580K
- 6th pct Service Resta…
- Royalty
- 6.0%
- 48th pct Service Resta…
- Units
- 24
- 51st pct Service Resta…
- SBA charge-off
- 28.8%
- % of SBA 7(a) loans not repaid · median varies by category
Quick verdict · Quick-Service Restaurants · color = vs category peers
Green = favorable by >10% vs Quick-Service Restaurants avg · 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 $173K – $663K including a $30K franchise fee, 6.0% ongoing royalty.
- RETURNSAverage unit revenue of $580K/year (median $465K).
- RISKVerdict C (Average), verdict score 40/100 (higher is better). SBA loan charge-off rate of 28.8% across 75 loans (well above the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2025).
- LEGAL20 litigation matters disclosed in Item 3, higher than typical. Review the summary for patterns (franchisor-initiated vs. franchisee-initiated).
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- Kahala Franchising, L.L.C.
- Parent company
- Kahala Brands, Inc.
- Ultimate parent
- MTY Food Group, Inc.
- Predecessor
- Kahala Franchise Corp. / Nicar Franchising, Inc.
- Prior franchisor entity
- CEO title
- Chief Executive Officer, MTY Food Group
- Eric Lefebvre
- CEO experience
- 2018 yrs
- Years in role or industry
- Incorporated in
- AZ
- HQ
- 9311 E. Via De Ventura, Scottsdale, Arizona 85258
- Auditor
- PricewaterhouseCoopers LLP
- Audited financials
- Franchisor revenue
- $580.3M
- vs $472.1M prior year
- Management churn noted
- Frequent turnover
- Item 2 disclosed frequent executive changes
Overview
About
- CEO
- Eric Lefebvre
- Headquarters
- AZ
- Founded
- 1984
- FDD year
- 2025
- States available
- 15
Can you afford it, and what does the money buy?
Entry cost runs 37% below the typical quick-service restaurants franchise.
Source: FDD 2025 · Items 5–7
Full Item 7 breakdown34 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Fee (Traditional) | $14K | $30K | |
| Lease Review Fee (Traditional) | $0 | $3K | |
| Rent/Security Deposit (3 months) (Traditional) | $12K | $20K | |
| Travel and Living Expenses (2 persons) during training (Traditional) | $3K | $5K | |
| Real Estate (Traditional) | — | — | |
| Architectural Fees (Traditional) | $15K | $25K | |
| Leasehold Improvements (Traditional) | $45K | $294K | |
| Restaurant Equipment, Furniture, Small Wares, Interior Signage and Menu Panels (Traditional) | $45K | $201K | |
| Exterior Signage (Traditional) | $10K | $17K | |
| Computer Hardware, Software (POS System) (Traditional) | $3K | $10K | |
| PCI Compliance Costs (Traditional) | $150 | $1K | |
| Opening Inventory (food and paper) (Traditional) | $3K | $7K | |
| Business Insurance (Traditional) | $1K | $5K | |
| Miscellaneous Opening Costs (Traditional) | $5K | $18K | |
| Grand Opening Marketing (Traditional) | $10K | $10K | |
| Depository Account (Traditional) | $3K | $3K | |
| Additional Funds - 3 month initial period (Traditional) | $5K | $15K | |
| Initial Franchise Fee (Non-Traditional) | $6K | $10K | |
| Lease Review Fee (Non-Traditional) | $0 | $3K | |
| Rent/Security Deposit (3 months) (Non-Traditional) | $6K | $20K | |
| Total initial investment | $326K | $1.1M |
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
- $173K – $663K
- Top 40% of category vs category
- Liquid capital req'd
- $5K – $15K
- Top 40% of category vs category
- Franchise fee
- $30K – $30K
- Top 40% of category vs category
- Royalty
- 6.0%
- Set by a formula · typical 6–8%
- Ad fund
- 1.0%
- typical 3–5%
- Total fee load
- 7.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 6.0% of gross sales |
| Marketing / ad fund | 1.0% |
| Technology fee | $75 |
| Training fee | $1K |
| Transfer fee | $8K |
| Renewal fee | $50 |
| Inventory (initial) | $3K – $7K |
| Total fee load | 7.0% of rev |
What do units actually make?
Average unit sales run 50% below the quick-service restaurants norm.
Source: FDD 2025 · Item 19
Single-unit · not modelled
Returns at a glance
An FDD discloses gross sales, not profit, and the operating costs that turn one into the other are in no filing. We publish no modelled return for Great Steak until someone supplies them — yours, in the models below.
—
Not modelled yet
An FDD discloses gross sales, not profit. We hold no sourced figure for 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.
Total invested capital · disclosed
$428K
Item 7 initial investment plus working capital, as filed — the one figure here that needs no assumption.
ROI & LBO modelsSingle-unit · 25-unit portfolio · editable
What one unit earns on your invested capital
Model A · Single-Unit Return
Computes unlevered return on invested capital (ROIC) for a single franchise unit, read against the 30–60% reference band · Yale SOM, Post-MBA Path Exhibit 2 (2023). Below that band a passive index fund likely outperforms; above it the franchisor has pricing power you're subsidizing.
Note: Item 19 revenue is what the franchisor discloses, and it is the top line only — gross sales are not profit. No FDD discloses the operating costs that turn one into the other, so those fields start empty and nothing is modelled until you supply them from your own lease quote, labor market and build-out budget.
Returns model · single-unit ROIC
What would one Great Steak 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 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.
What 25 units return when you use SBA financing
Model B · Return on Equity: Debt-Financed Acquisition
Models a 25-unit portfolio acquisition financed with an SBA 7(a) loan. Shows equity IRR (your return on cash invested), DSCR (how safely the cash flow covers debt service), and the capital stack (SBA + seller + equity breakdown).
This is the “search fund” or “entrepreneurship through acquisition” scenario: you buy an existing multi-unit operator, use leverage to amplify returns, and either operate or hire management. The 25-unit size is the typical minimum for an SBA-backed franchise portfolio acquisition to pencil as a full-time income.
What “return on equity” means here: if you put in $500K of your own cash and the business generates enough EBITDA to pay down debt and grow, your equity IRR is the annual return on that $500K, including the value created when you eventually sell. Target IRR for a search fund is typically 25–35%.
Not modelled yet
An FDD discloses gross sales, not profit. We hold no sourced figure for 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.
A 25-unit return is built on a per-unit EBITDA. Fill in the operating costs in Model A above and this model runs on that figure, or take the whole scenario to the full ROI workbench, where the portfolio and LBO models accept your own per-unit economics directly.
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
- Avg gross sales
- $580K
- Per unit, per year
- Median gross sales
- $465K
Gross sales are revenue before expenses — not profit. Actual owner earnings depend on rent, labor, royalties, marketing fees, and debt service.
- Item 19 type
- average gross sales
- Sample size
- 23 outlets
- vs category median 18
- Reporting year
- 2024
- Fiscal year the figures cover
- Source filing
- FDD 2025
- Disclosed in the 2025 filing, covering 2024
- Transparency
- 4 / 10
- vs category median 4 / 10 · typical
Compared against 782 Quick-Service Restaurants brands
Operator outlook
What the numbers say
Data-driven interpretation of this brand's financial disclosures, fee structure, and system trajectory.
Unit economics
Average unit generates $580K/year in gross sales. Median is $465K — top performers pull the average up, so a typical unit earns less. Revenue-to-investment ratio: 1.4x.
Fee burden
Total ongoing fee load of 7.0% (near the Quick-Service Restaurants average).
Disclosure
Transparency score 4/10 — this franchisor discloses detailed breakdowns (quartiles, segments, or cohort data). Buyers can model unit economics with higher confidence.
Operator retention
System contracting at -7.7% CAGR over 3 years. Investigate whether closures are franchisor-driven consolidation or franchisee exits.
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 averages
How Great Steak Compares
Is the system healthy?
Source: FDD 2025 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 24
- Opened
- 0
- Last reporting year
- Closed
- 1
- Terminated
- 0
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 4.2%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (3-yr)
- -7.7%
- Net unit change over 3 years
- 3-yr CAGR
- -7.7%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 2
- Closed (3yr)
- 7
- Terminated (3yr)
- 0
- Non-renewed (3yr)
- 2
- Transfers (3yr)
- 4
- Reacquired (3yr)
- 1
- Franchisor bought back
- Projected new
- 0
- Franchisor's next-year forecast
- Transfer rate
- 8.3%
- Owners selling to other franchisees
- Continuity rate
- 96.0%
- Units that stayed open
- Ceased ops
- 4.2%
- 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)
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 75
- Loan volume
- $13.5M
- Median loan
- $415K
- 50th percentile
- Charge-off rate
- 28.8%
- 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)
- 71.2%
- 5-yr charge-off
- 100.0%
- Loans approved 2021+
- Active lenders
- 33
- Defaults
- 19
- Typical loan rate
- 8.0%
- avg rate to borrowers
- Franchised industry avg
- 10.8%
- brand above franchise avg ↑
- Jobs supported
- 16
- 3.9 per loan
- Lender concentration
- 100%
- top lender's share
Borrower mix: 100% went to startups / new businesses, 0% to established operators
Franchise vs independent — in limited-service restaurants, franchised businesses charge off at 10.8% vs 10.0% for independents — franchising is associated with 8% higher SBA default risk in this category.
Top lenders financing Great Steak franchisees
Showing 3 of 33 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.
Premium insight
SBA Lending Report
Deep-dive into Great Steak's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 1 lenders with concentration factor
- Per-state charge-off rates across 1 states
- Startup risk premium and job creation velocity
- 1-year lending trend
Instant access. No subscription.
A 28.8% charge-off rate means roughly 1 in 3 franchisees failed to repay their SBA loan. Investigate what changed.
What could kill this investment?
SBA loans charge off at 28.8% — 80% above the 16.0% national norm, i.e. higher 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
Great Steak presents HIGH RISK due to declining unit base (-4% YoY), undisclosed profitability, multiple active litigations including franchise law violations, unprotected territory, and aggressive royalty floors relative to system revenue.
Litigation (Item 3)
Item 3 discloses numerous concluded arbitrations, lawsuits, and regulatory actions involving Kahala Franchising and affiliates including Famous Dave's, Papa Murphy's, SweetFrog, Wetzel's Pretzels, and predecessors. Two active FY2024 suits filed by franchisor against franchisees for breach of contract and forcible entry.
Largest disclosed settlement: $4,000,000
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · PricewaterhouseCoopers LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Financials are consolidated statements of MTY Franchising USA, Inc. (parent of franchisor Kahala Franchising, L.L.C.), in thousands of US dollars, years ended November 30, 2023 and 2022, audited by PwC (Montreal, Canada).
ⓘ These are the parent company's consolidated financials (the parent guarantees the franchisor), not this brand's standalone results — the figure reflects the whole corporate group, not this brand alone.
Supplier relationship · Items 8 & 16
- Franchisor sells you products: Yes
- Kickbacks from required suppliers: Yes
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 40 / 100 verdict
- 01MINORSystem shrinking at -4.0% YoY (24 units) indicates declining franchisee success and potential market saturation
- 02HIGHMultiple ongoing litigations including Washington Franchise Investment Protection Act violations and misrepresentation claims suggest franchisor credibility issues
- 03MINORRoyalty floor of $400/week ($20,800/year) is aggressive relative to average revenue of $579,903, creating cash flow pressure in slow periods
- 04MINORUnprotected territory creates direct competition risk from other Great Steak franchisees in same market
- 05HIGHLitigation history includes state administrative consent orders, indicating regulatory enforcement actions
- 06MEDHigh investment ceiling ($662,850) with unit decline suggests franchisor pushing larger formats that underperform
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 7.0% 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 | none |
| Protected territory | No |
| Exclusive territoryℹ | No |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 10 mi |
| Right of first refusalℹ | Yes |
| Transfer requires consent | Yes |
| Termination notice | 90 days |
| Mandatory arbitration | Yes |
| Arbitration location | County and state where franchised business is located |
| Jury trial waiver | Yes |
| Governing law | State where franchised business is located |
| Litigation count | 20 |
View Item 3 litigation summary
Item 3 discloses numerous concluded arbitrations, lawsuits, and regulatory actions involving Kahala Franchising and affiliates including Famous Dave's, Papa Murphy's, SweetFrog, Wetzel's Pretzels, and predecessors. Two active FY2024 suits filed by franchisor against franchisees for breach of contract and forcible entry.
Items 10, 11
Training & Operations
- Classroom training
- 40 hrs
- On-the-job training
- 40 hrs
- Training location
- Online or KTEC (Kahala Training & Education Center), Scottsdale, AZ (classroom); franchisee's restaurant location (OJT)
- Ongoing training
- Required
- Time to open
- 9 mo
- From signing to launch
- Site selection
- Franchisee with franchisor approval
- Franchisor financing
- Offered
- Item 10
Items 5 & 11
Franchisor Support
Item 20 · call current owners
Franchisee Contacts
2 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Great Steak · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Great Steak franchise?
The total investment to open a Great Steak franchise ranges from $173K – $663K, 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 Great Steak franchise owners earn?
According to Item 19 of the Great Steak FDD, the average gross sales per unit is $580K. The median is $465K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Item 19 in the Great Steak 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 Great Steak FDD and qualifies whose outlets they describe.
What is Great Steak's franchise failure rate?
Based on SBA 7(a) loan data, Great Steak has a charge-off rate of 28.8% across 75 loans, meaning 28.8% 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 Great Steak franchise locations are there?
As of their most recent FDD filing, Great Steak has 24 total units in the United States, including 24 franchised units and 0 company-owned units.
Is Great Steak a good franchise to buy?
FranchiseVerdict rates Great Steak as a C-grade franchise with a verdict score of 40 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 Great Steak, you can request corrections or provide updated information.
Other Quick-Service Restaurants franchises
Compare similar franchise opportunities in the Quick-Service Restaurants category
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.