Learning Express Franchise Cost, Revenue & Review 2026
- Investment
- $201K – $388K
- Disclosed sales
- $837K
- gross sales, not profit
- SBA charge-off
- 22.9%
- on 76 loans
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
Learning Express is a specialty toy-store franchise selling toys, games, and gifts with a neighborhood, service-oriented feel. Franchisees run stores managing curated inventory, merchandising, and personalized customer service.
FranchiseVerdict summary · 2026
A Learning Express franchise requires a total initial investment of $201K – $388K, including a $40K franchise fee and an ongoing 5.0% royalty[2]. Per the 2025 FDD, average unit revenue was $837K[2]. SBA 7(a) loans show a 22.9% charge-off rate across 76 loans[1]. FranchiseVerdict grade: B (Above average), an editorial assessment, not investment advice. Run a live ROI scan →
Sources, dates and evidence
FDD issued: · Data extracted: · Last cited check: · Staleness risk: medium - issued 12 to 24 months ago; a newer filing is likely on file
Evidence: strong✓ Investment (Item 7)✓ Item 19 status✓ Units and owners (Item 20)✓ SBA loan coverage✓ Litigation (Item 3)✓ Financial statements (Item 21)✓ Franchisor identityhow this is scored7 of 8 headline figures on this page cite a page of the filing; the rest are marked “Not cited” beside the figure.
Overview
- Investment
- $201K – $388K
- 24th pct Retail
- Avg gross sales
- $837K
- 11th pct Retail
- Royalty
- 5.0%
- 6th pct Retail
- Units
- 86
- 27th pct Retail
- SBA charge-off
- 22.9%
- % of SBA 7(a) loans not repaid · median varies by category
Quick verdict · Retail · color = vs category peers
Green = favorable by >10% vs Retail median · 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
- COSTTotal investment $201K – $388K including a $40K franchise fee, 5.0% ongoing royalty.
- RETURNSAverage unit revenue of $837K/year (median $820K).
- RISKVerdict B (Above average), verdict score 56/100 (higher is better). SBA loan charge-off rate of 22.9% across 76 loans (well above the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2025).
- GROWTHNegative: net -2 franchised outlets in the latest year (3 opened, 5 closed); 1 signed but not yet open (Item 20).
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- Learning Express, Inc.
- CEO title
- Chief Executive Officer, Secretary and Director
- Lauren Derse
- Incorporated in
- MA
- HQ
- 63 Walnut St., Devens, Massachusetts 01434
- Auditor
- Citrin Cooperman & Company, LLP
- Audited financials
- Franchisor revenue
- $4.9M
- vs $5.4M prior year
Overview
About
- CEO
- Lauren Derse
- Headquarters
- MA
- Founded
- 1987
- FDD year
- 2025
- States available
- 22
Can you afford it, and what does the money buy?
Entry cost runs 12% below the typical retail franchise.
Source: FDD 2025 · Items 5–7
FDD Item 7 · 2025 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $40K | $40K |
| Working capital (3–6 mo) | $10K | $30K |
| Equipment, build-out, other | $151K | $318K |
| Total initial investment | $201K | $388K |
Source: Learning Express 2025 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $201K – $388K
- Top 40% of category vs category
- Liquid capital req'd
- $10K – $30K
- Top 40% of category vs category
- Franchise fee
- $40K – $40K
- Top 40% of category vs category
- Royalty
- 5.0%
- Set by a formula · typical 6–8%
- Ad fund
- 0.0%
- typical 3–5%
- Total fee load
- 6.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 5.0% of gross sales |
| Marketing / ad fund | 0.0% of gross sales |
| Technology fee | $125 |
| Transfer fee | $20K |
| Inventory (initial) | $100K – $180K |
| Total fee load | 6.0% of rev |
A 6.0% total fee load is unusually lean. More of each revenue dollar stays with the franchisee.
What do units actually make?
Average unit sales land near the retail norm.
Source: FDD 2025 · Item 19
Single-unit · not modelled
Returns at a glance
An FDD discloses gross sales, not profit, and the operating costs that turn one into the other are in no filing. We publish no modelled return for Learning Express until someone supplies them — yours, in the models below.
—
Not modelled yet
An FDD discloses gross sales, not profit. We hold no sourced figure for COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
Total invested capital · disclosed
$315K
Item 7 initial investment plus working capital, as filed — the one figure here that needs no assumption.
ROI & LBO modelsSingle-unit · 25-unit portfolio · editable
What one unit earns on your invested capital
Model A · Single-Unit Return
Computes unlevered return on invested capital (ROIC) for a single franchise unit, read against the 30–60% reference band · Yale SOM, Post-MBA Path Exhibit 2 (2023). Below that band a passive index fund likely outperforms; above it the franchisor has pricing power you're subsidizing.
Note: Item 19 revenue is what the franchisor discloses, and it is the top line only — gross sales are not profit. No FDD discloses the operating costs that turn one into the other, so those fields start empty and nothing is modelled until you supply them from your own lease quote, labor market and build-out budget.
Returns model · single-unit ROIC
What would one Learning Express unit return on the cash you put in?
Illustrative category typicals — not sourced to any filing, survey or sample. Replace them with figures from franchisee validation calls before you rely on the output.
Unlevered ROIC · per unit
Your modelled return on total invested capital, before any debt financing.
—
An FDD discloses gross sales, not profit. We hold no sourced figure for COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
What 25 units return when you use SBA financing
Model B · Return on Equity: Debt-Financed Acquisition
Models a 25-unit portfolio acquisition financed with an SBA 7(a) loan. Shows equity IRR (your return on cash invested), DSCR (how safely the cash flow covers debt service), and the capital stack (SBA + seller + equity breakdown).
This is the “search fund” or “entrepreneurship through acquisition” scenario: you buy an existing multi-unit operator, use leverage to amplify returns, and either operate or hire management. The 25-unit size is the typical minimum for an SBA-backed franchise portfolio acquisition to pencil as a full-time income.
What “return on equity” means here: if you put in $500K of your own cash and the business generates enough EBITDA to pay down debt and grow, your equity IRR is the annual return on that $500K, including the value created when you eventually sell. Target IRR for a search fund is typically 25–35%.
Not modelled yet
An FDD discloses gross sales, not profit. We hold no sourced figure for COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
A 25-unit return is built on a per-unit EBITDA. Fill in the operating costs in Model A above and this model runs on that figure, or take the whole scenario to the full ROI workbench, where the portfolio and LBO models accept your own per-unit economics directly.
These models are for research and scenario planning only. Not investment advice. Actual results depend on your specific location, management, and market conditions. Consult a franchise attorney and accountant before signing any franchise agreement.
Item 19 · Source: 2025 FDD
Financial Performance
- Avg gross sales
- $837K
- Per unit, per year
- Median gross sales
- $820K
Gross sales are revenue before expenses — not profit. Actual owner earnings depend on rent, labor, royalties, marketing fees, and debt service.
- Item 19 type
- gross sales
- Sample size
- 84 outlets
- vs category median 46
- Range (low → high)
- $153K→$1.9MCited, not corroborated — printed on page 35 of the 2025 FDD. Nothing else in our record independently restates or re-derives it.
- Cohort dispersion (min → max)
- Reporting year
- 2024
- Fiscal year the figures cover
- Source filing
- FDD 2025
- Disclosed in the 2025 filing, covering 2024
- Transparency
- 6 / 10
- vs category median 3 / 10 · above
Compared against 278 Retail 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 $837K/year in gross sales. Revenue-to-investment ratio: 2.8x.
Fee burden
Total ongoing fee load of 6.0% — below the Retail median of 8.0%.
Disclosure
Transparency score 6/10 — this franchisor discloses detailed breakdowns (quartiles, segments, or cohort data). Buyers can model unit economics with higher confidence.
Operator retention
System contracting at -3.4% CAGR over 3 years. Investigate whether closures are franchisor-driven consolidation or franchisee exits.
Multi-unit rate
Only 16% of franchisees own multiple units. Could indicate challenging economics or a young system where operators haven't had time to expand.
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 Retail medians
How Learning Express Compares
Category median of published Retail brands that report the figure; the middle half spans the 25th to 75th percentile and n counts the brands behind it. Medians are used because a few very large systems pull an average far from the typical brand. Revenue is disclosed gross sales, not profit.
Is the system healthy?
Source: FDD 2025 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 86
- Opened
- 3
- Last reporting year
- Closed
- 5
- Turnover rate
- 14.0%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Multi-unit owners
- 16.0%
- Net growth (3-yr)
- +1.1%
- Net unit change over 3 years
- 3-yr CAGR
- -3.4%
- Compounded over last 3 years
Last fiscal year · Item 20 exits and transfers
- Signed, not yet open
- 1
- 0.01 per open outlet · Item 20 Table 5
- Projected new
- 3
- Franchisor's next-year forecast
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 22 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.
Where the owners are · Item 20 owner list
93 current owners across 22 states.
- TX 13
- MA 11
- PA 8
- OH 7
- GA 6
- IL 6
- NJ 6
- FL 5
- NY 5
- CA 4
- NC 4
- LA 3
- +10 more states
Counts only, from the list the franchisor prints in Item 20. Names and phone numbers are for your own due diligence and are not shown here.
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
- $14.4M
- Median loan
- $180K
- 50th percentile
- Charge-off rate
- 22.9%
- on 76 loans · 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)
- 77.1%
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 32
- Defaults
- 16
- Typical loan rate
- 6.6%
- avg rate to borrowers
- Franchised industry avg
- 22.4%
- brand above franchise avg ↑
- Jobs supported
- 395
- 2.7 per loan
- Lender concentration
- 26%
- top lender's share
Borrower mix: 14% went to startups / new businesses, 86% to established operators
Franchise vs independent — in hobby, toy, and game stores, franchised businesses charge off at 22.4% vs 22.6% for independents — franchising is associated with 1% lower SBA default risk in this category.
Vintage analysis
Learning Express charge-off rate by loan vintage
Top lenders financing Learning Express franchisees
Showing 3 of 32 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.
Lender network · 7(a) + 504
SBA Lending Report
Full lending analysis for Learning Express from SBA 7(a) FOIA data.
- Principal loss rate
- 13.6%
- Avg SBA guarantee
- 74%
- Avg interest rate
- 6.63%
- Avg chargeoff amount
- $122K
- Lender concentration
- 26.3%
- Job velocity
- 2.7 per $100K
- NAICS benchmark
- 22.9%
- NAICS 451120
- Jobs supported
- 395
Top SBA lendersTop lender holds 26% of loans
| # | Lender | Loans | Volume | Default % |
|---|---|---|---|---|
| 1 | Readycap Lending, LLC | 20 | $4.2M | 30.0% |
| 2 | JPMorgan Chase Bank, National Association | 8 | $1.0M | 12.5% |
| 3 | Wells Fargo Bank National Association | 5 | $828K | 20.0% |
| 4 | PNC Bank, National Association | 4 | $325K | 0.0% |
| 5 | TD Bank, National Association | 3 | $400K | 33.3% |
| 6 | Bank of America, National Association | 3 | $719K | 0.0% |
| 7 | Bank of Hope | 2 | $200K | 50.0% |
| 8 | Santander Bank, National Association | 2 | $200K | 0.0% |
| 9 | Popular Bank | 2 | $355K | 0.0% |
| 10 | U.S. Bank, National Association | 2 | $380K | 0.0% |
Geographic failure vector
| State | Loans | Defaults | Rate |
|---|---|---|---|
| TXTexas | 11 | 3 | 27.3% |
| NJNew Jersey | 9 | 2 | 22.2% |
| FLFlorida | 8 | 2 | 25.0% |
| PAPennsylvania | 6 | 0 | 0.0% |
| CACalifornia | 5 | 2 | 40.0% |
| COColorado | 4 | 0 | 0.0% |
| NYNew York | 4 | 1 | 25.0% |
| GAGeorgia | 3 | 0 | 0.0% |
| INIndiana | 3 | 0 | 0.0% |
| MAMassachusetts | 3 | 0 | 0.0% |
SBA 7(a) lending trend
Borrower profile
Source: SBA 7(a) + 504 FOIA loan-level data, matched by FranchiseVerdict
A 22.9% charge-off rate means roughly 1 in 4 franchisees failed to repay their SBA loan. Investigate what changed.
What could kill this investment?
SBA loans charge off at 22.9% — 43% 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
Learning Express shows concerning unit decline, undisclosed profitability, and high fixed royalty costs that warrant careful validation before committing to a six-figure investment in a shrinking franchise system.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Citrin Cooperman & Company, LLP
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: No
- Restricted to system-approved products: Yes
Score breakdown · what drove the 56 / 100 verdict
- 01MINORUnit count declining 2.3% YoY (86 total units) suggests shrinking franchise system and potential market saturation or franchisee dissatisfaction
- 02MEDNet income not disclosed in Item 19 — unable to validate actual profitability; average revenue of $836,884 means nothing without expense data
- 03MINORHigh royalty floor of $1,500/month ($18,000 annually) creates fixed cost burden even during slow sales periods, reducing flexibility
- 04MINORInitial investment range ($201,491–$387,514) is substantial for a learning center with declining unit count and unproven net margins
- 05MINOR10-year term is long given system contraction; difficult to exit if performance underperforms
- 06MEDFranchise fee of $40,000 is moderately high relative to declining system size and lack of disclosed profitability metrics
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 6.0% of sales (royalty + ad fund), before rent and labor.
Source: FDD 2025 · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 10 years |
| Allowed renewalsℹ | 2 |
| Territory type | Exclusive territory |
| Protected territory | Yes |
| Exclusive territoryℹ | Yes |
| 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 | 40 mi |
| Right of first refusalℹ | Yes |
| RoFR response window | 10 days |
| Transfer requires consent | Yes |
| Termination notice | 10 days |
| Mandatory arbitration | No |
| Arbitration location | Massachusetts |
| Jury trial waiver | No |
| Governing law | MA |
| Litigation count | 0 |
Items 10, 11
Training & Operations
- Classroom training
- 30 hrs
- On-the-job training
- 392 hrs
- Training location
- Online and/or at a store in Massachusetts; franchisee's location; Annual Convention
- Ongoing training
- Required
- Site selection
- franchisee with franchisor assistance
- Franchisor financing
- Not offered
- Item 10
Items 5 & 11
Franchisor Support
Item 20 · call current owners
Franchisee Contacts
93 owners to call
Name · phone · city · state. Extracted from FDD Item 20
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Learning Express franchise?
The total investment to open a Learning Express franchise ranges from $201K – $388K, with an initial franchise fee of $40K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Learning Express franchise owners earn?
According to Item 19 of the Learning Express FDD, the average gross sales per unit is $837K. The median is $820K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
Who owns Learning Express?
Learning Express is franchised by Learning Express, Inc.. Source: FDD Item 1, 2025 filing.
What is Item 19 in the Learning Express FDD?
The FDD section where a franchisor may disclose financial performance of its outlets. Disclosure is optional and formats vary; figures are typically gross sales, which is revenue before expenses, not profit. FranchiseVerdict extracts these figures directly from the Learning Express FDD and qualifies whose outlets they describe.
What is Learning Express's franchise failure rate?
Based on SBA 7(a) loan data, Learning Express has a charge-off rate of 22.9% across 76 loans, meaning 22.9% 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 Learning Express franchise locations are there?
As of their most recent FDD filing, Learning Express has 86 total units in the United States, including 86 franchised units and 0 company-owned units. 3 new units were opened in the latest reporting year.
Is Learning Express a good franchise to buy?
FranchiseVerdict rates Learning Express as a B-grade franchise with a verdict score of 56 out of 100 (higher is better). The grade is a deterministic score built from six weighted dimensions — financial health, unit economics, unit growth, scale, legal, and transparency — then calibrated against SBA loan charge-off rates and FDD age. Transparency is one of the six, so a filing that discloses less scores lower on that dimension than one that discloses more. 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
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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.