Hounds Town USAFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Hounds Town USA franchise requires a total initial investment of $542K – $1.1M, including a $49K franchise fee and an ongoing 6.0% royalty[2]. Per the 2024 FDD, average unit revenue was $597K[2]. SBA 7(a) loans show a 0.0% charge-off rate across 76 loans[1]. Verdict grade: A. Run a live ROI scan →
Data last verified June 21, 2026 · figures per the 2024 FDD issuance
Overview
- Investment
- $542K – $1.1M
- 72nd pct Pet Services
- Avg gross sales
- $597K
- 32nd pct Pet Services
- Royalty
- 6.0%
- 16th pct Pet Services
- Units
- 55
- 62nd pct Pet Services
- SBA default
- 0.0%
- system-wide median varies by category
Quick verdict · Pet Services · color = vs category peers
Green = >15% above Pet Services 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
At 0.7x revenue per dollar invested, this system underperforms the typical 1.5-2.5x range.
Only 0.0% of 76 SBA loans charged off, well below the 16% franchise average.
The system grew 46% year-over-year. Fast growth means demand, but can strain support.
19% cash-on-cash return. Within the 15-30% range most franchise investors consider acceptable.
Bottom line
- Total investment $542K – $1.1M including a $49K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $597K/year (median $603K), with an estimated 19% cash-on-cash return.
- Verdict A (Top Quintile) with a risk score of 46/100. SBA loan charge-off rate of 0.0% across 76 loans (well below the franchise average, based on all SBA 7(a) franchise lending, 2010–2024).
- System growing at 170.0% CAGR over 3 years with 55 total units. Strong expansion trajectory.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Hounds Town USA, LLC
- Incorporated in
- FL
- HQ
- 150 E. Robinson St., Unit 2008, Orlando, Florida 32801
- Auditor
- Kezos & Dunlavy
- Audited financials
- Franchisor revenue
- $1.1M
- vs $2.7M prior year
Overview
About
Hounds Town USA operates doggy daycare and boarding facilities where franchisees manage daily pet care operations, including staff hiring/training, facility maintenance, customer acquisition, and veterinary coordination. Franchisees oversee the customer-facing side of providing supervised playtime, boarding, grooming, and training services to dog owners in their protected territory.
- CEO
- Robert Flanagan
- Headquarters
- FL
- Founded
- 2007
- FDD year
- 2024
- States available
- 19
FDD Item 7 · 2024 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $49K | $49K |
| Working capital (3–6 mo) | $30K | $60K |
| Equipment, build-out, other | $463K | $950K |
| Total initial investment | $542K | $1.1M |
Source: Hounds Town USA 2024 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
$90K
15.0% margin
Unlevered ROIC
11%
EBITDA / total invested capital
Payback
9.4 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $542K – $1.1M
- Below avg, review vs category
- Liquid capital req'd
- $30K – $60K
- Near category avg vs category
- Franchise fee
- $49K – $49K
- Near category avg vs category
- Royalty
- 6.0%
- Gross Sales · typical 6–8%
- Ad fund
- 2.0%
- typical 3–5%
- Total fee load
- 8.0%
- vs 9–13% typical
- Payback period
- 5.1 yrs
- From FDD / Item 19
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 6.0% of gross sales |
| Marketing / ad fund | 2.0% of gross sales |
| Technology fee | $150 |
| Transfer fee | $25K |
| Renewal fee | $12K |
| Total fee load | 8.0% of rev |
Financial Performance
- Avg gross sales
- $597K
- Per unit, per year
- Median gross sales
- $603K
- Avg net income
- $156K
- Cash-on-cash
- 19.4%
- Based on Net Income / investment midpoint
- Item 19 type
- net_sales
- Sample size
- 37 units
- vs category median 12 · large
- Range (low → high)
- $167K→$1.4M
- Cohort dispersion (min → max)
- Transparency
- 10 / 5
- vs category median 4 / 5 · above
Compared against 75 Pet Services brands
Revenue is only 0.7x the investment. This means each unit may take 5+ years to recoup the initial outlay at typical margins.
vs Pet Services averages
How Hounds Town USA Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 55
- Opened
- 17
- Last reporting year
- Closed
- 0
- Turnover rate
- 0.0%
- Company-owned
- 1
- Corporate units in the system
- % franchised
- 98%
- vs corporate-owned
- Net growth (yr3)
- +45.9%
- Net unit change last year
- 3-yr CAGR
- +170.0%
- Compounded over last 3 years
3-year detail · Item 20
- Transfers (3yr)
- 0
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 8 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.
Fast growth in a small system. Newer franchisors expanding quickly may not yet have the support infrastructure of larger systems.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 76
- Loan volume
- $43.5M
- Median loan
- $596K
- 50th percentile
- Charge-off rate
- 0.0%
- 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)
- 100.0%
- 5-yr charge-off
- 0.0%
- Loans approved 2021+
- Active lenders
- 31
- Defaults
- 0
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Hounds Town USA's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 10 lenders with concentration factor
- Per-state charge-off rates across 15 states
- Startup risk premium and job creation velocity
- 7-year lending trend
- SBA 504 real estate/equipment data
Instant access. No subscription.
With a 0.0% charge-off rate across 76 loans, banks have historically viewed this brand favorably for lending.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Hounds Town shows signs of growth-at-all-costs franchise model with aggressive unit expansion, questionable financial performance metrics, and prior litigation over support obligations.
Audited financials (Item 21)
Yes · Kezos & Dunlavy
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Score breakdown · what drove the 46 / 100 rating
- 01MINORExplosive 45.9% YoY unit growth is unsustainable and suggests aggressive recruitment over profitability focus; typical mature franchises grow 5-15% annually
- 02MINORNet income of $155,505 on $597,260 revenue (26% net margin) appears inflated — industry standard for pet services is 10-15%; suggests either aggressive accounting or cherry-picked top performers in Item 19
- 03HIGHLitigation history involving breach of contract on buildout assistance indicates franchisor-franchisee disputes over support promises; 'dismissed with prejudice' may reflect settlement rather than merit
- 04MINORHigh royalty rate (6%) combined with high investment ceiling ($1.06M) creates substantial fixed costs with thin margins; breakeven analysis needed
- 05MINORFranchise fee ($49K) seems low relative to investment range, suggesting franchisor prioritizes recruitment velocity over franchisee success
- 06MINORNo Item 19 financial data provided; averages cited may not represent median performance — top 20% likely distort the picture
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 | 10 years |
|---|---|
| Renewal term | 10 years |
| Allowed renewalsℹ | 2 |
| Territory type | exclusive |
| Protected territory | Yes |
| Online sales rights | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Right of first refusalℹ | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Governing law | Florida |
| Litigation count | 1 |
Items 10, 11
Training & Operations
- Classroom training
- 50 hrs
- On-the-job training
- 123 hrs
- POS system
- QuickBooks and point-of-sale software from approved supplier
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: QuickBooks and point-of-sale software from approved supplier
Item 20 · call current owners
Franchisee Contacts
17 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Hounds Town USA · FDD (2024) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Hounds Town USA franchise?
The total investment to open a Hounds Town USA franchise ranges from $542K – $1.1M, with an initial franchise fee of $49K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Hounds Town USA franchise owners earn?
According to Item 19 of the Hounds Town USA FDD, the average gross sales per unit is $597K. The median is $603K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Hounds Town USA's franchise failure rate?
Based on SBA 7(a) loan data, Hounds Town USA has a charge-off rate of 0.0% across 76 loans, meaning 0.0% 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 Hounds Town USA franchise locations are there?
As of their most recent FDD filing, Hounds Town USA has 55 total units in the United States, including 20 franchised units and 1 company-owned units. 17 new units were opened in the latest reporting year.
Is Hounds Town USA a good franchise to buy?
FranchiseVerdict rates Hounds Town USA as a A-grade franchise with a risk score of 46 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.