On The Border Mexican Grill & Cantina
Bottom line
- Total investment $2.9M – $5.1M including a $30K franchise fee, 4.0% ongoing royalty.
- Average unit revenue of $2.3M/year (median $2.2M).
- Rated MODERATE with a risk score of 55/100. SBA loan default rate of 0.0% across 5 loans (below the industry average).
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 On The Border Mexican Grill & Cantina unit return on the cash you put in?
Unlevered ROIC · per unit
9%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 On The Border Mexican Grill & Cantina units return on equity?
Equity IRR · 5-yr
27.9%
3.42× MOIC
Year-1 DSCR
2.92×
EBITDA ÷ debt service
Equity required
$11.3M
on $23.2M purchase
Total debt
$12.0M
SBA $5.0M + senior + seller note
Overview
About
Franchisees operate full-service Mexican casual-dining restaurants averaging ~$2.3M in annual revenue, managing 50–100+ employees across kitchen, bar, and front-of-house operations. Daily responsibilities include food cost management, labor scheduling, inventory control, and brand-standard execution (table service, margarita/drink programs, Tex-Mex menu). Franchisees must typically work on-site and manage p&l across 5–8 day/week operating cycles.
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 · 8 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
Material profitability opacity combined with high capital requirement, sluggish unit growth, and exposure to declining casual-dining category presents meaningful risk despite no litigation or going concern flags.
Score breakdown · what drove the 55 / 100 rating
- 01MEDNet income not disclosed in Item 19 — inability to validate actual profitability despite $2.3M average revenue
- 02MINORHigh initial investment ($2.9M–$5.1M) with modest 4% royalty creates pressure to hit $2.3M revenue baseline to break even
- 03MINORSlow unit growth (8.7% YoY) suggests market saturation or franchisee satisfaction concerns in mature 134-unit system
- 04MED20-year term locks franchisees into long commitment with no disclosed performance benchmarks or exit clauses
- 05MINORCasual dining segment structurally challenged post-2020 with labor cost inflation and consumer traffic volatility
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
16 numbers
One-time purchase · CSV download · Validation questions included
FDD download
On The Border Mexican Grill & Cantina · FDD (2024) PDF