Magnolia BakeryFranchise Cost, Revenue & Review 2026
Data from FDD filing
FranchiseVerdict summary · 2026
A Magnolia Bakery franchise requires a total initial investment of $594K – $1.2M, including a $49K franchise fee and an ongoing 6.0% royalty[2]. Per the 2025 FDD, average unit revenue was $4.5M[2]. Verdict grade: A. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2025 FDD issuance
Overview
- Investment
- $594K – $1.2M
- 87th pct Service Resta…
- Avg gross sales
- $4.5M
- 58th pct Service Resta…
- Royalty
- 6.0%
- 44th pct Service Resta…
- Units
- 11
- 37th pct Service Resta…
- SBA default
- N/A
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
Each dollar invested generates 5.0x in gross revenue, well above the typical 1.5-2.5x range.
156% cash-on-cash return (based on P&L Bottom Line). Above the 20% threshold most investors target.
Bottom line
- Total investment $594K – $1.2M including a $49K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $4.5M/year (median $4.2M), with an estimated 156% cash-on-cash return (based on P&L Bottom Line).
- Verdict A (Top Quintile) with a risk score of 12/100.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Magnolia Bakery International, LLC
- Parent company
- Magnolia Group Holdings, Inc.
- Incorporated in
- DE
- HQ
- 244 West 54th Street, Suite 501, New York, NY 10019
- Auditor
- CohnReznick LLP
- Audited financials
- Franchisor revenue
- $1.5M
- vs $1.5M prior year
Overview
About
Franchisees operate premium artisan bakery retail locations featuring signature cupcakes, cakes, and baked goods, managing daily production, staffing, inventory, and customer-facing sales. Operations require baking expertise or trained staff, retail space management, and adherence to brand recipes and presentation standards.
- CEO
- Barbara Petracca
- Headquarters
- NY
- Founded
- 2011
- FDD year
- 2025
- States available
- 3
FDD Item 7 · 2025 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $49K | $49K |
| Working capital (3–6 mo) | $53K | $123K |
| Equipment, build-out, other | $493K | $1.0M |
| Total initial investment | $594K | $1.2M |
Source: Magnolia Bakery 2025 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
$624K
14.0% margin
Unlevered ROIC
64%
EBITDA / total invested capital
Payback
19 mo
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $594K – $1.2M
- Below avg, review vs category
- Liquid capital req'd
- $53K – $123K
- Below avg, review vs category
- Franchise fee
- $39K – $49K
- Below avg, review vs category
- Royalty
- 6.0%
- Gross Revenues · typical 6–8%
- Ad fund
- 2.0%
- typical 3–5%
- Total fee load
- 8.0%
- vs 9–13% typical
- Payback period
- 0.6 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 | $99 |
| Transfer fee | $25K |
| Renewal fee | $50 |
| Total fee load | 8.0% of rev |
Financial Performance
- Avg gross sales
- $4.5M
- Per unit, per year
- Median gross sales
- $4.2M
- Avg p&l bottom line
- $1.4M
- Reported as P&L Bottom Line in FDD Item 19
- Cash-on-cash
- 156.2%
- Based on P&L Bottom Line / investment midpoint
- Item 19 type
- Affiliate-owned stores
- Sample size
- 10 units
- vs category median 28 · small
- Range (low → high)
- $2.0M→$8.0M
- Cohort dispersion (min → max)
- Transparency
- 10 / 5
- vs category median 4 / 5 · above
Compared against 453 Quick-Service Restaurants brands
Revenue is 5.0x the investment midpoint. At typical franchise margins, this suggests a payback under 3 years.
vs Quick-Service Restaurants averages
How Magnolia Bakery Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 11
- Opened
- 1
- Last reporting year
- Closed
- 0
- Turnover rate
- 0.0%
- Company-owned
- 10
- Corporate units in the system
- % franchised
- 9%
- vs corporate-owned
3-year detail · Item 20
- Transfers (3yr)
- 0
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 15 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.
No SBA loan data available for this brand.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Magnolia Bakery presents cautionary risk due to a micro-sized system with no published financials, prior international disputes, and limited growth visibility despite attractive per-unit economics.
Audited financials (Item 21)
Yes · CohnReznick LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Score breakdown · what drove the 12 / 100 rating
- 01MINOROnly 11 units system-wide with unknown/stagnant growth trajectory raises scalability and viability concerns
- 02HIGHNo Item 19 financial performance representations (Going Concern: False) limits ability to validate the $1.39M average net income claim
- 03MINOR2017 international arbitration settlement ($349K over 48 months) indicates management/execution challenges and operational disputes
- 04MINORHigh initial investment ($594K-$1.19M) relative to small franchise system size creates heightened franchisee risk
- 05MINOR6% royalty on $4.46M average revenue ($267K annually) is substantial margin erosion with unproven unit economics transparency
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 | 5 years |
| Allowed renewalsℹ | 2 |
| Territory type | Radius |
| Protected territory | Yes |
| 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 | 30 days |
| Mandatory arbitration | No |
| Jury trial waiver | Yes |
| Governing law | New York |
| Litigation count | 1 |
Items 10, 11
Training & Operations
- Classroom training
- 38 hrs
- On-the-job training
- 288 hrs
- POS system
- Toast POS system
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Toast POS system
Item 20 · call current owners
Franchisee Contacts
19 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Magnolia Bakery · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Magnolia Bakery franchise?
The total investment to open a Magnolia Bakery franchise ranges from $594K – $1.2M, 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 Magnolia Bakery franchise owners earn?
According to Item 19 of the Magnolia Bakery FDD, the average gross sales per unit is $4.5M. The median is $4.2M. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Magnolia Bakery's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Magnolia Bakery (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 Magnolia Bakery franchise locations are there?
As of their most recent FDD filing, Magnolia Bakery has 11 total units in the United States, including 9 franchised units and 10 company-owned units. 1 new units were opened in the latest reporting year.
Is Magnolia Bakery a good franchise to buy?
FranchiseVerdict rates Magnolia Bakery as a A-grade franchise with a risk score of 12 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.
For franchisors
Are you the franchisor?
If you represent Magnolia Bakery, you can request corrections or provide updated information.
Claim this brandOther Quick-Service Restaurants franchises
Compare similar franchise opportunities in the Quick-Service Restaurants category
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.