Menchie's
Bottom line
- Total investment $165K – $425K including a $40K franchise fee.
- Average unit revenue of $499K/year (median $461K).
- Rated MODERATE with a risk score of 55/100. SBA loan default rate of 0.0% across 297 loans (below the industry average).
- System contracting at -7.5% CAGR over 3 years. Investigate whether closures are franchisor-driven (consolidation) or franchisee-driven (economics).
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 Menchie's unit return on the cash you put in?
Unlevered ROIC · per unit
16%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Menchie's units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$300K
on $1.5M purchase
Total debt
$1.2M
SBA $0.7M + senior + seller note
Overview
About
Franchisees operate self-serve frozen yogurt shops where customers fill cups with yogurt, add toppings, and pay by weight. Day-to-day operations include managing point-of-sale systems, maintaining yogurt/topping inventory, cleaning equipment, staffing shifts, and handling customer service in a high-traffic retail environment.
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 · 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 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
Menchie's presents meaningful caution-level risk due to contracting unit count, missing profitability disclosure, and high capital requirements relative to an uncertain return profile in a declining franchise system.
Score breakdown · what drove the 55 / 100 rating
- 01MINORUnit count declining 6.6% YoY (297 units) indicates systemic contraction and potential franchisee dissatisfaction
- 02MINORNo Item 19 (average net income) disclosure raises transparency concerns about actual profitability claims
- 03MINORHigh initial investment ($165k-$425k) coupled with declining system suggests uncertain ROI and market saturation
- 04MINORRoyalty structure ($125 minimum + 6% of sales) creates fixed costs that may be unaffordable during slow periods, especially for locations with <$2,083 monthly revenue
- 05MED10-year term is long for a declining QSR franchise without disclosed unit economics or performance benchmarks
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
99 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Menchie's · FDD (2024) PDF