Bottom line
- Total investment $490K – $821K including a $30K franchise fee.
- Average unit revenue of $1.9M/year (median $1.1M).
- Rated CAUTION with a risk score of 69/100. SBA loan default rate of 0.0% across 1 loans (below the industry average).
- 21 litigation matters disclosed in Item 3 — higher than typical. Review the summary for patterns (franchisor-initiated vs. franchisee-initiated).
Item 1 · who you're contracting with
The Franchisor
Yale framework · single-unit ROIC
Returns Analysis
Pulls Item 7 (investment) and Item 19 (revenue) from this brand's FDD into the Yale unlevered-ROIC formula. Override any input to stress-test it against your own assumptions.
The model · Yale framework
What would one Manchu WOK unit return on the cash you put in?
Unlevered ROIC · per unit
42%
In Yale's "attractive" band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Manchu WOK units return on equity?
Equity IRR · 5-yr
34.0%
4.32× MOIC
Year-1 DSCR
2.39×
EBITDA ÷ debt service
Equity required
$5.6M
on $15.2M purchase
Total debt
$9.5M
SBA $5.0M + senior + seller note
Overview
About
Franchisees operate quick-service Chinese restaurants featuring wok-prepared dishes, typically located in malls or street-front locations. Day-to-day operations include food preparation, staffing, inventory management, and point-of-sale transactions, with royalty obligations based on weekly gross sales.
Item 7 · what it costs
The Vitals
Item 19
Financial Performance
Item 20 · unit dynamics
The Growth Chart
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 30 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 phone area codes (Item 20). Approximate — ported numbers may show the original state, not the franchisee's current location.
Government records
SBA Loan Data
Aggregated from SBA 7(a) loan disclosures, public data unique to FranchiseVerdict.
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Manchu WOK presents HIGH RISK: a contracting 15-unit system with undisclosed profitability, active going concern issues, extensive litigation history, and unprotected territories — indicating structural franchisor problems that jeopardize franchisee ROI.
Score breakdown · what drove the 69 / 100 rating
- 01MINOROnly 15 units with unknown/stagnant growth trajectory suggests system contraction or stability crisis
- 02HIGHGoing Concern = False indicates franchisor financial distress and potential inability to support franchisees
- 03HIGH21 disclosed litigation actions involving predecessors/affiliates reveal pattern of breach of contract and misrepresentation claims
- 04MEDNet income not disclosed despite $1.89M average revenue — likely unprofitable unit economics or hidden losses
- 05MINORNo protected territory exposes franchisees to direct competition from other Manchu WOK locations and company-owned stores
- 06MINORHigh initial investment ($490K-$821K) paired with 7% royalty on gross (not net) creates unsustainable payback period
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
Item 11
Training & Operations
Item 20
Franchisee Contacts
Phone numbers extracted directly from this brand's FDD Item 20. After purchase, you'll also receive a list of validation questions tailored to this brand.
Franchisee contacts
30 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Manchu WOK · FDD (2025) PDF