LapelsFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Lapels franchise requires a total initial investment of $92K – $1.7M, including a $60K franchise fee and an ongoing 6.0% royalty[2]. Per the 2026 FDD, average unit revenue was $423K[2]. SBA 7(a) loans show a 25.0% charge-off rate across 44 loans[1]. Verdict grade: F. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2026 FDD issuance
Overview
- Investment
- $92K – $1.7M
- 30th pct Cleaning & Ma…
- Avg gross sales
- $423K
- 14th pct Cleaning & Ma…
- Royalty
- 6.0%
- 10th pct Cleaning & Ma…
- Units
- 83
- 59th pct Cleaning & Ma…
- SBA default
- 25.0%
- system-wide median varies by category
Quick verdict · Cleaning & Maintenance · color = vs category peers
Green = >15% above Cleaning & Maintenance 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 0.5x revenue per dollar invested, this system underperforms the typical 1.5-2.5x range.
25.0% of SBA loans charged off across 44 loans, above the 16% franchise average.
Bottom line
- Total investment $92K – $1.7M including a $60K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $423K/year (median $389K).
- Verdict F (Bottom Quintile) with a risk score of 99/100. SBA loan charge-off rate of 25.0% across 44 loans (well above the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2024).
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Next Step Franchising, LLC
- Parent company
- Clean Franchise Brands, LLC
- Incorporated in
- DE
- HQ
- 711 5th Avenue South, Suite 210, Naples, FL 34102
- Auditor
- Metwally CPA PLLC
- Audited financials
- Franchisor revenue
- $2.3M
- vs $2.8M prior year
Overview
About
Lapels operates as a dry cleaning and laundry franchise, with franchisees managing customer-facing operations including garment intake, processing, quality control, and customer service delivery. Day-to-day activities involve staffing operations, managing inventory, handling cleaning equipment, and maintaining service standards across the store location.
- CEO
- Kevin A. DuBois
- Headquarters
- FL
- Founded
- 2018
- FDD year
- 2026
- States available
- 16
FDD Item 7 · 2026 filing · 45 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Fee (Plant) | $50K | $50K | |
| Initial Training and Site Support Fee (Plant) | $7K | $7K | |
| Travel And Living Expenses While Training (Plant) | $0 | $2K | |
| Real Estate and Prepaid Rent, Security And Utility Deposits (Plant) | $0 | $15K | |
| Leasehold improvements (Plant) | $0 | $160K | |
| Start Up Supplies and Equipment Package (Plant) | $294K | $329K | |
| Green Earth Solvent Licensing Fee (Plant) | $3K | $3K | |
| Signage and permits (Plant) | $8K | $12K | |
| Grand Opening and First Year Marketing Fee (Plant) | $9K | $9K | |
| Insurance (Plant) | $480 | $960 | |
| Miscellaneous opening costs (Plant) | $300 | $3K | |
| Additional funds - 3 months (Plant) | $20K | $140K | |
| Initial Franchise Fee (Satellite Store) | $25K | $25K | |
| Initial Training and Site Support Fee (Satellite Store) | $4K | $4K | |
| Travel And Living Expenses While Training (Satellite Store) | $0 | $2K | |
| Real Estate and Prepaid Rent, Security And Utility Deposits (Satellite Store) | $0 | $8K | |
| Leasehold improvements (Satellite Store) | $0 | $50K | |
| Start Up Supplies and Equipment Package (Satellite Store) | $38K | $40K | |
| Signage and permits (Satellite Store) | $5K | $10K | |
| Grand Opening and First Year Marketing Fee (Satellite Store) | $9K | $9K | |
| Total initial investment | $845K | $1.6M |
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.
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
$47K
11.0% margin
Unlevered ROIC
5%
EBITDA / total invested capital
Payback
19.8 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $92K – $1.7M
- Better than avg vs category
- Liquid capital req'd
- $1K – $40K
- Better than avg vs category
- Franchise fee
- $27K – $60K
- Near category avg vs category
- Royalty
- 6.0%
- Gross Revenue · 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 | $1K |
| Training fee | $7K |
| Transfer fee | $48K |
| Renewal fee | $15K |
| Total fee load | 8.0% of rev |
Financial Performance
- Avg gross sales
- $423K
- Per unit, per year
- Median gross sales
- $389K
- Item 19 type
- Historical Financial Performance
- Sample size
- 67 units
- vs category median 31 · large
- Range (low → high)
- $42K→$989K
- Cohort dispersion (min → max)
- Transparency
- 7 / 5
- vs category median 4 / 5 · above
Compared against 204 Cleaning & Maintenance brands
Revenue is only 0.5x the investment. This means each unit may take 5+ years to recoup the initial outlay at typical margins.
vs Cleaning & Maintenance averages
How Lapels Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 83
- Opened
- 3
- Last reporting year
- Closed
- 1
- Terminated
- 0
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 1
- Term expired, not renewed (per Item 20)
- Turnover rate
- 1.2%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (yr3)
- +2.5%
- Net unit change last year
- 3-yr CAGR
- +0.0%
- Compounded over last 3 years
3-year detail · Item 20
- Transfers (3yr)
- 5
- Projected new
- 19
- Franchisor's next-year forecast
- Transfer rate
- 3.6%
- Owners selling to other franchisees
- Termination rate
- 1.2%
- Franchisor-initiated terminations
- Ceased ops
- 4.8%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 18 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 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 44
- Loan volume
- $13.9M
- Median loan
- $133K
- 50th percentile
- Charge-off rate
- 25.0%
- 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)
- 78.6%
- 5-yr charge-off
- 0.0%
- Loans approved 2021+
- Active lenders
- 21
- Defaults
- 6
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Lapels'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 9 states
- Startup risk premium and job creation velocity
- 13-year lending trend
- SBA 504 real estate/equipment data
Instant access. No subscription.
A 25.0% charge-off rate means roughly 1 in 4 franchisees failed to repay their SBA loan. Investigate what changed.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Lapels presents meaningful risk due to stagnant growth, lack of net income transparency, recent litigation history, and royalty structure that may not align with profitability.
Litigation (Item 3)
No litigation is required to be disclosed in this Item.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Metwally CPA PLLC
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
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 99 / 100 rating
- 01MINORStagnant unit growth of only 2.5% YoY with 83 units suggests market saturation or franchisee dissatisfaction
- 02MEDNet income not disclosed in FDD Item 19 prevents accurate ROI calculation on $40,900–$1.7M investment range
- 03HIGHRecent litigation with franchisees (Barros case) over breach of contract and unconscionability indicates franchisor-franchisee disputes
- 04MINORWide investment range ($40,900 to $1.7M) with average revenue of only $423K suggests inconsistent unit economics
- 05MED6% royalty on gross revenue (not net) combined with undisclosed profitability creates cash flow risk
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 |
| Territory type | Geographic area |
| Protected territory | Yes |
| Territory radius | 3 mi |
| 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 | 3 mi |
| Right of first refusalℹ | Yes |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Arbitration location | Florida |
| Jury trial waiver | Yes |
| Governing law | Florida |
| Litigation count | 2 |
View Item 3 litigation summary
No litigation is required to be disclosed in this Item.
Items 10, 11
Training & Operations
- Classroom training
- 25 hrs
- On-the-job training
- 93 hrs
- Training location
- Hanover, Massachusetts offices and local area stores
- Time to open
- 4 mo
- From signing to launch
- POS system
- SPOT and Cents
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: SPOT and Cents
Item 20 · call current owners
Franchisee Contacts
83 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Lapels · FDD (2026) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Lapels franchise?
The total investment to open a Lapels franchise ranges from $92K – $1.7M, with an initial franchise fee of $60K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Lapels franchise owners earn?
According to Item 19 of the Lapels FDD, the average gross sales per unit is $423K. The median is $389K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Lapels's franchise failure rate?
Based on SBA 7(a) loan data, Lapels has a charge-off rate of 25.0% across 44 loans, meaning 25.0% 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 Lapels franchise locations are there?
As of their most recent FDD filing, Lapels has 83 total units in the United States, including 83 franchised units and 0 company-owned units. 3 new units were opened in the latest reporting year.
Is Lapels a good franchise to buy?
FranchiseVerdict rates Lapels as a F-grade franchise with a risk score of 99 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.