Bottom line
- Total investment $566K – $830K including a $40K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $2.8M/year.
- Rated MODERATE with a risk score of 60/100.
- No protected territory and the franchisor reserves the right to compete in your area. Clarify territorial boundaries before signing.
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 H&H Bagels unit return on the cash you put in?
Unlevered ROIC · per unit
54%
In Yale's "attractive" band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 H&H Bagels units return on equity?
Equity IRR · 5-yr
28.4%
3.49× MOIC
Year-1 DSCR
2.86×
EBITDA ÷ debt service
Equity required
$10.5M
on $22.1M purchase
Total debt
$11.6M
SBA $5.0M + senior + seller note
Overview
About
H&H Bagels franchisees operate bagel shops focused on retail sales and potentially catering services. Day-to-day operations include production/baking of bagels, counter service, inventory management, staff scheduling, and local marketing. The business model relies on foot traffic and repeat customers in a single location.
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 · 20 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.
No SBA loan data available for this brand.
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Micro-system with undisclosed profitability, unprotected territory, and going concern risk makes this a speculative investment with limited scalability validation.
Score breakdown · what drove the 60 / 100 rating
- 01MINOROnly 3 units in the entire system with unknown/likely stagnant growth trajectory
- 02MEDNet income not disclosed in FDD Item 19 — impossible to validate actual profitability claims
- 03MINORNo protected territory — direct competition from other H&H franchisees or company-owned locations permitted
- 04HIGHGoing Concern status is FALSE — franchisor may have solvency or operational stability issues
- 05MINORHigh investment range ($566K–$829.5K) relative to micro-franchise size creates poor risk/reward ratio
- 06MINOR6% royalty on $2.76M average revenue = ~$165K annually before considering operating costs, debt service, and rent
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
23 numbers
One-time purchase · CSV download · Validation questions included
FDD download
H&H Bagels · FDD (2024) PDF