Hot Dog On A StickFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A HOT DOG ON A STICK franchise requires a total initial investment of $332K – $439K, including a $25K franchise fee and an ongoing 6.0% royalty[2]. Per the 2023 FDD, average unit revenue was $505K[2]. Verdict grade: B. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2023 FDD issuance
Overview
- Investment
- $332K – $439K
- 64th pct Service Resta…
- Avg gross sales
- $505K
- 9th pct Service Resta…
- Royalty
- 6.0%
- 44th pct Service Resta…
- Units
- 50
- 63rd pct Service Resta…
- SBA default
- 100.0%
- system-wide median varies by category
Quick verdict · Quick-Service Restaurants · color = vs category peers
Green = >15% above Quick-Service Restaurants avg · No shading = within ±15% · Red = >15% below avg · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Franchised units fell from 18 to 15 over 3 years. Investigate why operators are leaving.
Bottom line
- Total investment $332K – $439K including a $25K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $505K/year (median $482K).
- Verdict B (Above Average) with a risk score of 58/100.
- Bankruptcy history disclosed in the FDD. Review Item 4 for details before proceeding.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- HDOS Franchising, LLC
- Parent company
- FAT Brands, Inc.
- Predecessor
- and Affiliates
- Prior franchisor entity
- CEO title
- Chief Executive Officer of HDOS and Chief Development Officer of FAT
- Taylor Wiederhorn
- Incorporated in
- DE
- HQ
- 9720 Wilshire Boulevard Suite 500, Beverly Hills, California 90212
- Auditor
- Baker Tilly US, LLP
- Audited financials
- Franchisor revenue
- $1.3M
- vs $1.9M prior year
- Management churn noted
- Frequent turnover
- Item 2 disclosed frequent executive changes
Overview
About
Franchisees operate quick-service food stands specializing in hot dogs, corn dogs, and casual fast-food items, typically in high-traffic locations like malls or entertainment venues. Day-to-day operations involve food preparation, staff management, inventory control, and point-of-sale transactions under the Hot Dog on a Stick brand standards. Franchisees must maintain brand consistency while managing labor costs and food costs in an inherently low-margin QSR environment.
- CEO
- Taylor Wiederhorn
- Headquarters
- CA
- Founded
- 2014
- FDD year
- 2023
- States available
- 4
FDD Item 7 · 2023 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $25K | $25K |
| Working capital (3–6 mo) | $8K | $12K |
| Equipment, build-out, other | $299K | $402K |
| Total initial investment | $332K | $439K |
Source: HOT DOG ON A STICK 2023 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
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
$71K
14.0% margin
Unlevered ROIC
18%
EBITDA / total invested capital
Payback
5.6 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $332K – $439K
- Near category avg vs category
- Liquid capital req'd
- $8K – $12K
- Better than avg vs category
- Franchise fee
- $25K – $25K
- Better than avg vs category
- Royalty
- 6.0%
- Net Sales · typical 6–8%
- Ad fund
- 2.0%
- typical 3–5%
- Total fee load
- 8.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 6.0% of gross sales |
| Marketing / ad fund | 2.0% of gross sales |
| Technology fee | $2K |
| Transfer fee | $15K |
| Renewal fee | $10K |
| Total fee load | 8.0% of rev |
Financial Performance
- Avg gross sales
- $505K
- Per unit, per year
- Median gross sales
- $482K
- Item 19 type
- gross_sales
- Sample size
- 45 units
- vs category median 28
- Range (low → high)
- $185K→$992K
- Cohort dispersion (min → max)
- Transparency tier
- revenue_only
- Categorical assessment of disclosure depth
- Transparency
- 7 / 5
- vs category median 4 / 5 · above
Compared against 453 Quick-Service Restaurants brands
vs Quick-Service Restaurants averages
How Hot Dog On A Stick Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 50
- Opened
- 2
- 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
- 2.0%
- Company-owned
- 32
- Corporate units in the system
- % franchised
- 36%
- vs corporate-owned
- Multi-unit owners
- 13.0%
- Net growth (yr3)
- +5.9%
- Net unit change last year
- 3-yr CAGR
- +20.0%
- Compounded over last 3 years
3-year detail · Item 20
- Transfers (3yr)
- 1
- Projected new
- 0
- Franchisor's next-year forecast
- Transfer rate
- 2.0%
- Owners selling to other franchisees
- Ceased ops
- 2.0%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 4 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 contact records (FDD Item 20). Shows states with at least one current operator on file. Full state registration data (Item 12) will appear on a future FDD refresh.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA loan disclosures. This brand has only 2 7(a) loans on file; statistical reliability is limited below 10 loans.
- Total loans
- 2
- Loan volume
- $190K
- Median loan
- $95K
- 50th percentile
- Charge-off rate
- 100.0%
- 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)
- 0.0%
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 1
- Defaults
- 2
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Hot Dog On A Stick'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
- 2-year lending trend
- SBA 504 real estate/equipment data
Instant access. No subscription.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Hot Dog on a Stick presents CAUTION-level risk due to contracting unit base, parent company SEC litigation, missing profitability data, unprotected territory, and history of franchise relationship disputes that obscure true franchisee financial performance.
Litigation (Item 3)
Consolidated securities class action (Matthews v. FAT Brands, Inc. and Chipman v. FAT Brands, Inc.) alleging false and misleading statements under Securities Exchange Act of 1934 related to February 2022 LA Times story. Settled in principle for $2.5 million cash and $0.5 million in Class A common stock.
Largest disclosed settlement: $3,000,000
Bankruptcy (Item 4)
Disclosed in last 7 years
Two former affiliates filed Chapter 11 petitions on April 6, 2009: (1) Fatburger Restaurants of California, Inc. (Case No. 0913964-KT) converted to Chapter 7 on June 24, 2011, closed July 15, 2014; (2) Fatburger Restaurants of Nevada, Inc. (Case No. 0913965-KT) converted to Chapter 7 on June 24, 2011. Both conducted restaurant auctions on April 21, 2011.
Audited financials (Item 21)
Yes · Baker Tilly US, LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Kickbacks from required suppliers: No
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 58 / 100 rating
- 01MINORDeclining unit count (50 units, -5.9% YoY) indicates system contraction and potential franchisee dissatisfaction
- 02HIGHParent company FAT Brands facing active SEC securities class action litigation regarding financial reporting integrity
- 03MEDNo Item 19 (Average Unit Volume) disclosed — revenue figures ($504,890 avg) lack verification and profitability context is hidden
- 04MINORUnprotected territory creates direct competition risk; franchisees can cannibalize each other's sales
- 05HIGHHigh litigation history including development fee disputes and restaurant sale conflicts suggests franchisor relationship issues
- 06MED6% royalty on $504,890 avg revenue ($30,293/year) combined with undisclosed net income makes ROI on $331,500-$439,000 investment opaque
- 07MED15-year term is lengthy given system decline and no protected exclusivity
- 08MINORRoyalty structure lacks transparency — 'total net sales' definition not clarified (gross vs. after refunds/discounts?)
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 15 years |
|---|---|
| Renewal term | 10 years |
| Allowed renewalsℹ | 2 |
| Protected territory | No |
| Online sales rights | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Non-compete (years)ℹ | 2 years |
| Right of first refusalℹ | Yes |
| Termination notice | 10 days |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Governing law | California |
| Litigation count | 7 |
View Item 3 litigation summary
Consolidated securities class action (Matthews v. FAT Brands, Inc. and Chipman v. FAT Brands, Inc.) alleging false and misleading statements under Securities Exchange Act of 1934 related to February 2022 LA Times story. Settled in principle for $2.5 million cash and $0.5 million in Class A common stock.
Items 10, 11
Training & Operations
- Classroom training
- 78 hrs
- On-the-job training
- 422 hrs
- Training location
- Our corporate offices in Beverly Hills, CA
- Ongoing training
- Required
- Field support
- 38 hrs/yr
- On-site visits per year
- Time to open
- 12 mo
- From signing to launch
- Franchisor financing
- Offered
- Item 10
Items 5 & 11
Franchisor Support
Item 20 · call current owners
Franchisee Contacts
19 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
HOT DOG ON A STICK · FDD (2023) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a HOT DOG ON A STICK franchise?
The total investment to open a HOT DOG ON A STICK franchise ranges from $332K – $439K, with an initial franchise fee of $25K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do HOT DOG ON A STICK franchise owners earn?
According to Item 19 of the HOT DOG ON A STICK FDD, the average gross sales per unit is $505K. The median is $482K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is HOT DOG ON A STICK's franchise failure rate?
SBA 7(a) loan charge-off data is not available for HOT DOG ON A STICK (fewer than 10 loans on file). Charge-off rates are one way to gauge franchise risk, but not all franchise loans go through the SBA program. We recommend reviewing turnover and closure data in the FDD and speaking with current franchisees.
How many HOT DOG ON A STICK franchise locations are there?
As of their most recent FDD filing, HOT DOG ON A STICK has 50 total units in the United States, including 18 franchised units and 32 company-owned units. 2 new units were opened in the latest reporting year.
Is HOT DOG ON A STICK a good franchise to buy?
FranchiseVerdict rates HOT DOG ON A STICK as a B-grade franchise with a risk score of 58 out of 100, 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.
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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.