Palgong TeaFranchise Cost, Revenue & Review 2026
Data from FDD filing
FranchiseVerdict summary · 2026
A PALGONG TEA franchise requires a total initial investment of $148K – $186K, including a $20K franchise fee and an ongoing 5.0% royalty[2]. The 2021 FDD does not disclose unit-level revenue (no Item 19). Verdict grade: B. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2021 FDD issuance
Overview
- Investment
- $148K – $186K
- 18th pct Service Resta…
- Avg gross sales
- N/A
- 59th pct Service Resta…
- Royalty
- 5.0%
- 13th pct Service Resta…
- Units
- 1
- 3rd 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
Bottom line
- Total investment $148K – $186K including a $20K franchise fee, 5.0% ongoing royalty.
- No Item 19 financial performance data disclosed. The franchisor chose not to publish revenue figures.
- Verdict B (Above Average) with a risk score of 61/100.
- No Item 19 financial performance representation. Without franchisor-disclosed revenue data, you'll need to gather unit economics directly from existing franchisees.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- PalgongTea Franchising LLC
- Parent company
- PalgongTea USA, Inc.
- Incorporated in
- IL
- HQ
- 1625 North Milwaukee Avenue, Glenview, Illinois 60025
- Auditor
- B. H. Whang and Associates, Ltd.
- Audited financials
- Franchisor revenue
- $22K
- Most recent fiscal year
Overview
About
Palgong Tea franchisees operate quick-service beverage retail locations specializing in Korean-style tea drinks. Daily operations include preparing specialty teas, managing POS systems, handling customer transactions, inventory management, and maintaining brand standards across the limited location network.
- CEO
- John Park
- Headquarters
- IL
- Founded
- 2020
- FDD year
- 2021
- States available
- 1
FDD Item 7 · 2021 filing · 14 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Fee | $20K | $20K | |
| Rent, Security Deposit, and Other Real Estate Services and Costs | — | — | |
| Leasehold Improvements | $50K | $70K | |
| Signage | $5K | $5K | |
| Furniture and Fixtures | $10K | $15K | |
| Equipment | $15K | $20K | |
| Point-of-Sale Hardware and Software | $5K | $5K | |
| Business Licenses and Permits | $1K | $1K | |
| Professional Fees | $5K | $5K | |
| Initial Inventory | $8K | $10K | |
| Insurance | $2K | $3K | |
| Training Expenses | $5K | $5K | |
| Grand Opening Advertising | $2K | $2K | |
| Additional Funds - 3 Months | $20K | $25K | |
| Total initial investment | $148K | $186K |
Line items extracted from FDD Item 7. Ranges reflect the franchisor's stated low and high per line. Total is the sum of line-item lows / highs — actual costs may fall outside this range depending on market and build-out scope.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $148K – $186K
- Better than avg vs category
- Liquid capital req'd
- $20K – $25K
- Near category avg vs category
- Franchise fee
- $20K – $20K
- Better than avg vs category
- Royalty
- 5.0%
- percentage_of_gross · typical 6–8%
- Ad fund
- 3.0%
- typical 3–5%
- Total fee load
- 8.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 5.0% of gross sales |
| Marketing / ad fund | 3.0% of gross sales |
| Training fee | $5K |
| Transfer fee | $15K |
| Renewal fee | $0 |
| Total fee load | 8.0% of rev |
Financial Performance
This franchisor did not disclose financial performance representations in Item 19, or our extractor could not parse them.
vs Quick-Service Restaurants averages
How Palgong Tea Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 1
- Opened
- 0
- Last reporting year
- Closed
- 0
- Terminated
- 0
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 0.0%
- Company-owned
- 1
- Corporate units in the system
- % franchised
- 0%
- vs corporate-owned
- Multi-unit owners
- 9.1%
3-year detail · Item 20
- Transfers (3yr)
- 0
- Projected new
- 0
- Franchisor's next-year forecast
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 5 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
Single-unit, pre-revenue-disclosure franchise with corporate going concern issues and unproven business model poses extreme validation and profitability risk.
Litigation (Item 3)
No litigation information required to be disclosed in Item 3
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · B. H. Whang and Associates, Ltd.
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Kickbacks from required suppliers: No
- Must buy proprietary products: No
- Restricted to system-approved products: No
- Can negotiate own supplier terms: Yes
Score breakdown · what drove the 61 / 100 rating
- 01MINOROnly 1 existing unit—system shows no growth trajectory or scalability proof
- 02HIGHGoing Concern status is FALSE, indicating financial viability concerns at corporate level
- 03MINORNo Item 19 financial disclosure (avg revenue/net income)—impossible to validate ROI on $147,500-$185,700 investment
- 04MED5-year term is shorter than industry standard (10 years), suggesting limited franchisor commitment or high turnover
- 05MEDExtremely limited track record with single unit makes franchisee comparison and validation impossible
- 06HIGHNo disclosed litigation history doesn't mitigate systemic weakness—early-stage brand with minimal exposure
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 | 5 years |
|---|---|
| Renewal term | 5 years |
| Allowed renewalsℹ | 2 |
| Territory type | Radius |
| Protected territory | Yes |
| Exclusive territoryℹ | No |
| Territory radius | 5 mi |
| Territory population | 125,000 |
| Online sales rights | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Not allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 10 mi |
| Right of first refusalℹ | Yes |
| RoFR response window | 30 days |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Arbitration location | Glenview, Illinois |
| Jury trial waiver | Yes |
| Governing law | Illinois |
| Litigation count | 0 |
View Item 3 litigation summary
No litigation information required to be disclosed in Item 3
Items 10, 11
Training & Operations
- Classroom training
- 12 hrs
- On-the-job training
- 24 hrs
- Training location
- On-site and corporate
- Ongoing training
- Required
Items 5 & 11
Franchisor Support
Item 20 · call current owners
Franchisee Contacts
7 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
PALGONG TEA · FDD (2021) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a PALGONG TEA franchise?
The total investment to open a PALGONG TEA franchise ranges from $148K – $186K, with an initial franchise fee of $20K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do PALGONG TEA franchise owners earn?
PALGONG TEA does not disclose average franchise owner earnings in their FDD Item 19. Not all franchisors are required to make financial performance representations. We recommend asking existing franchisees directly about their financial experience.
What is PALGONG TEA's franchise failure rate?
SBA 7(a) loan charge-off data is not available for PALGONG TEA (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 PALGONG TEA franchise locations are there?
As of their most recent FDD filing, PALGONG TEA has 1 total units in the United States, including 0 franchised units and 1 company-owned units.
Is PALGONG TEA a good franchise to buy?
FranchiseVerdict rates PALGONG TEA as a B-grade franchise with a risk score of 61 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
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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.