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. Per the 2024 FDD, average unit revenue was $580K[2]. SBA 7(a) loans show a 28.8% charge-off rate across 75 loans[1]. FranchiseVerdict grade: D (Below average), an editorial assessment, not investment advice. Run a live ROI scan →
Data last verified · figures per the 2024 FDD issuance
Overview
- Investment
- $173K – $663K
- 22nd pct Service Resta…
- Avg gross sales
- $580K
- 9th pct Service Resta…
- Royalty
- N/A
- Units
- 24
- 47th 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
- Total investment $173K – $663K including a $30K franchise fee.
- Average unit revenue of $580K/year (median $465K).
- Verdict D (Below average), verdict score 31/100 (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).
- 20 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
- 2024
- States available
- 15
Can you afford it, and what does the money buy?
Entry cost runs 34% below the typical quick-service restaurants franchise.
Source: FDD 2024 · 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
- Middle of category vs category
- Royalty
- Greater of 6% of total weekly Gross Sales or $400 per wee…
- Ad fund
- 1.0%
- typical 3–5%
- Total fee load
- 7.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty (flat) | greater of 6% of total weekly Gross Sales or $400 per week |
| Marketing / ad fund | 1.0% of gross sales |
| 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 47% below the quick-service restaurants norm.
Source: FDD 2024 · Item 19
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
$87K
15.0% margin
Unlevered ROIC
20%
EBITDA / total invested capital
Payback
4.9 yrs
cash-on-cash, unlevered
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 units
- vs category median 28
- Reporting year
- 2024
- Fiscal year the figures cover
- Transparency
- 4 / 10
- vs category median 3 / 10 · above
Compared against 485 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 2024 · 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
- 37.5%
- 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)
ⓘ 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 31 / 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
- 03MINORNo average net income disclosure (Item 19) prevents accurate ROI assessment despite $153.5K-$662.8K investment range
- 04MINORRoyalty floor of $400/week ($20,800/year) is aggressive relative to average revenue of $579,903, creating cash flow pressure in slow periods
- 05MINORUnprotected territory creates direct competition risk from other Great Steak franchisees in same market
- 06HIGHLitigation history includes state administrative consent orders, indicating regulatory enforcement actions
- 07MEDHigh 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 2024 · 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 (2024) 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 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 D-grade franchise with a verdict score of 31 out of 100 (higher is better), 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
Are you the franchisor?
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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.