Milkshake Factory
Bottom line
- Total investment $510K – $773K including a $60K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $716K/year. Estimated payback in 7.1 years.
- Rated STRONG with a risk score of 44/100. SBA loan default rate of 0.0% across 12 loans (below the industry average).
- Auditor disclosed a going-concern note — flagged doubt about the franchisor's ability to continue operations. Verify against the latest FDD.
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 Milkshake Factory 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 Milkshake Factory units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$1.1M
on $5.7M purchase
Total debt
$4.6M
SBA $2.9M + senior + seller note
Overview
About
Franchisees operate quick-service beverage retail locations specializing in premium milkshakes and frozen drinks. Day-to-day operations include ingredient prep, blending/serving customer orders, point-of-sale management, inventory control, staffing, and local marketing to drive foot traffic and repeat business.
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 · 26 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
Milkshake Factory presents moderate-to-cautionary risk: a micro-franchise system with thin unit profitability, undisclosed growth metrics, and high capital requirements relative to demonstrated returns.
Score breakdown · what drove the 44 / 100 rating
- 01MINOROnly 14 units system-wide with unknown/stagnant growth trajectory raises scalability and viability concerns
- 02MINORNet income of $89,973 on $716,078 revenue (12.6% net margin) is thin; 6% royalty + operating costs leave minimal cushion
- 03MINORHigh initial investment range ($510K–$773K) against modest profitability creates extended breakeven period and elevated financial risk
- 04MEDNo Item 19 financial performance representations disclosed; cannot validate franchisor's average revenue/income claims independently
- 05MINORSmall franchise system (14 units) limits peer benchmarking, support infrastructure, and brand recognition leverage
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
51 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Milkshake Factory · FDD (2025) PDF