Panda Express Franchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
Panda Express is a quick-service franchise serving American-Chinese favorites like orange chicken from a made-fresh steam-table line. Franchisees run restaurants managing cooking, service, and heavy online and delivery volume.
FranchiseVerdict summary · 2026
A Panda Express franchise requires a total initial investment of $515K – $3.3M, including a $13K – $25K franchise fee and an ongoing 8.0% royalty[2]. Per the 2025 FDD, average unit revenue was $1.6M[2]. FranchiseVerdict grade: A (Strongest tier), an editorial assessment, not investment advice. Run a live ROI scan →
Data last verified · figures per the 2025 FDD issuance
Overview
- Investment
- $515K – $3.3M
- 78th pct Service Resta…
- Avg gross sales
- $1.6M
- 26th pct Service Resta…
- Royalty
- 8.0%
- 89th pct Service Resta…
- Units
- 2,502
- 95th pct Service Resta…
- SBA charge-off
- N/A
Quick verdict · Quick-Service Restaurants · color = vs category peers
Green = favorable by >10% vs Quick-Service Restaurants avg · No shading = within ±10% · Red = unfavorable by >10% · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Bottom line
- COSTTotal investment $515K – $3.3M including a $25K franchise fee, 8.0% ongoing royalty.
- RETURNSAverage unit revenue of $1.6M/year (median $1.2M).
- RISKVerdict A (Strongest tier), verdict score 75/100 (higher is better).
- LEGAL13 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
Corporate structure & franchisor financials
- Legal entity
- Citadel Panda Express, Inc.
- Parent company
- Panda Express, Inc. (PEI)
- Ultimate parent
- Panda Restaurant Group, Inc. (PRG)
- CEO title
- Co-Chairman and Co-CEO
- Andrew Jin-Chan Cherng / Peggy Tsiang Cherng
- Founder active
- Yes
- Original founder still leading the business
- Incorporated in
- CA
- HQ
- 1683 Walnut Grove Avenue, Rosemead, California 91770
- Auditor
- CliftonLarsonAllen LLP
- Audited financials
- Franchisor revenue
- $28.3M
- vs $25.7M prior year
Affiliated brands
- owns and operates
Other brands the franchisor or its parent operates (Item 1).
Overview
About
- CEO
- Andrew Jin-Chan Cherng / Peggy Tsiang Cherng
- Headquarters
- CA
- Founded
- 1990
- FDD year
- 2025
- States available
- 39
Can you afford it, and what does the money buy?
Entry cost runs 188% above the typical quick-service restaurants franchise.
Source: FDD 2025 · Items 5–7
Full Item 7 breakdown16 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial License Feenot refundable | $25K | $25K | |
| Lease of Premises (Initial 3 months' rent) | $10K | $425K | |
| Leasehold Improvements | $100K | $1.5M | |
| Furniture, Fixtures, Equipment and Supplies | $120K | $650K | |
| Initial Inventory | $11K | $18K | |
| Computer Hardware and Software | $17K | $27K | |
| Non-resettable cash register(s) | $6K | $8K | |
| Insurance | $95K | $158K | |
| Expenses Incurred During Initial Training | $13K | $29K | |
| Architectural and Design Fees | $35K | $120K | |
| Construction Supervision | $20K | $150K | |
| Sales Tax Deposits | $5K | $10K | |
| Telephone, Fax and other Communication Related Fees | $500 | $1K | |
| Licenses and Permits | $2K | $60K | |
| Payroll and Related Taxes | $39K | $65K | |
| Additional Funds (3 months) | $18K | $30K | |
| Total initial investment | $515K | $3.3M |
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
- $515K – $3.3M
- Bottom third — review vs category
- Liquid capital req'd
- $18K – $30K
- Top 40% of category vs category
- Franchise fee
- $13K – $25K
- Top 40% of category vs category
- Royalty
- 8.0%
- percentage · typical 6–8%
- Ad fund
- No formal advertising fund; franchisees are not currently…
- Total fee load
- 8.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 8.0% of gross sales |
| Transfer fee | $10K |
| Renewal fee | $10K |
| Inventory (initial) | $11K – $18K |
| Total fee load | 8.0% of rev |
What do units actually make?
Average unit sales run 31% above the quick-service restaurants norm.
Source: FDD 2025 · Item 19
Single-unit · estimated
Returns at a glance
Indicative numbers using FDD Item 7 / Item 19 inputs and category-benchmarked cost ratios. Full single-unit, 25-unit portfolio, and LBO models (with every input editable to stress-test your own scenario) live on the financials page.
Store EBITDA · annual
$174K
11.0% margin
Unlevered ROIC
9%
EBITDA / total invested capital
Payback
11.0 yrs
cash-on-cash, unlevered
ROI & LBO modelsSingle-unit · 25-unit portfolio · editable
What one unit earns on your invested capital
Model A · Single-Unit Return
Computes unlevered return on invested capital (ROIC) for a single franchise unit. The target band for an attractive franchise is 30–60% ROIC. Below that and a passive index fund likely outperforms; above that and the franchisor has pricing power you're subsidizing.
Note: Item 19 revenue is what the franchisor discloses. It's the top line only. Operating costs below are category estimates. Override them to match your real lease quote, labor market, and build-out budget.
Returns model · single-unit ROIC
What would one Panda Express unit return on the cash you put in?
Unlevered ROIC · per unit
Estimated return on your total franchise investment, before any debt financing.
9%
Below the 30–60% attractive-franchise band
What 25 units return when you use SBA financing
Model B · Return on Equity: Debt-Financed Acquisition
Models a 25-unit portfolio acquisition financed with an SBA 7(a) loan. Shows equity IRR (your return on cash invested), DSCR (how safely the cash flow covers debt service), and the capital stack (SBA + seller + equity breakdown).
This is the “search fund” or “entrepreneurship through acquisition” scenario: you buy an existing multi-unit operator, use leverage to amplify returns, and either operate or hire management. The 25-unit size is the typical minimum for an SBA-backed franchise portfolio acquisition to pencil as a full-time income.
What “return on equity” means here: if you put in $500K of your own cash and the business generates enough EBITDA to pay down debt and grow, your equity IRR is the annual return on that $500K, including the value created when you eventually sell. Target IRR for a search fund is typically 25–35%.
Levered LBO scenario · Yale Crease Capital framing
What would 25 Panda Express units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$1.3M
on $6.3M purchase
Total debt
$5.1M
SBA $3.2M + senior + seller note
These models are for research and scenario planning only. Not investment advice. Actual results depend on your specific location, management, and market conditions. Consult a franchise attorney and accountant before signing any franchise agreement.
Item 19 · Source: 2025 FDD
Financial Performance
- Avg gross sales
- $1.6M
- Per unit, per year
- Median gross sales
- $1.2M
Gross sales are revenue before expenses — not profit. Actual owner earnings depend on rent, labor, royalties, marketing fees, and debt service.
- Item 19 type
- gross sales
- Sample size
- 156 outlets
- vs category median 20 · large
- Range (low → high)
- $247K→$9.2M
- Cohort dispersion (min → max)
- Transparency tier
- revenue_only
- Categorical assessment of disclosure depth
- Reporting year
- 2024
- Fiscal year the figures cover
- Source filing
- FDD 2025
- Disclosed in the 2025 filing, covering 2024
- Transparency
- 4 / 10
- vs category median 4 / 10 · typical
Compared against 782 Quick-Service Restaurants brands
Revenue is only 0.8x the investment. This means each unit may take 5+ years to recoup the initial outlay at typical margins.
Operator outlook
What the numbers say
Data-driven interpretation of this brand's financial disclosures, fee structure, and system trajectory.
Unit economics
Average unit generates $1.6M/year in gross sales. Median is $1.2M — top performers pull the average up, so a typical unit earns less. Revenue-to-investment ratio: 0.8x.
Fee burden
Total ongoing fee load of 8.0% (near the Quick-Service Restaurants average).
Disclosure
Transparency score 4/10 — this franchisor discloses detailed breakdowns (quartiles, segments, or cohort data). Buyers can model unit economics with higher confidence.
Operator retention
System expanding at 10.2% CAGR over 3 years across 2,502 units — operators are staying and new ones are joining.
Multi-unit rate
Only 11% of franchisees own multiple units. Could indicate challenging economics or a young system where operators haven't had time to expand.
Source: FDD Item 19 financial performance representations and publicly filed FDD data. Past performance is not indicative of future results. Verify all figures with the franchisor and current franchisees before making any investment decision.
vs Quick-Service Restaurants averages
How Panda Express Compares
Is the system healthy?
Source: FDD 2025 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 2,502
- Opened
- 35
- Last reporting year
- Closed
- 5
- Terminated
- 2
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 1.2%
- Company-owned
- 2,329
- Corporate units in the system
- % franchised
- 7%
- vs corporate-owned
- Multi-unit owners
- 11.1%
- Net growth (3-yr)
- +10.2%
- Net unit change over 3 years
- 3-yr CAGR
- +10.2%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 11
- Closed (3yr)
- 0
- Terminated (3yr)
- 2
- Non-renewed (3yr)
- 0
- Transfers (3yr)
- 3
- Reacquired (3yr)
- 1
- Franchisor bought back
- Transfer rate
- 0.1%
- Owners selling to other franchisees
- Ceased ops
- 0.2%
- Units that stopped operating
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 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 loan disclosures. This brand has only 1 7(a) loan on file; statistical reliability is limited below 10 loans.
- Total loans
- 1
- Loan volume
- $511K
- Median loan
- $511K
- average
- Charge-off rate
- N/A
- limited sample (1 loan) — rate not shown below 10
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- N/A
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 1
- Defaults
- N/A
Explore lender portfolios on Bank Reports or regional data on State Reports.
What could kill this investment?
Source: SBA 7(a) FOIA · FDD Items 3, 21
Risk analysis
FranchiseVerdict rating + FDD Items 3, 4, 8, 16, 21
Risk & Legal
Panda Express presents meaningful caution-level risk due to lack of profitability disclosure, substantial litigation exposure around labor practices, high fixed royalty minimums, unprotected territory, and slow unit growth suggesting market saturation.
Litigation (Item 3)
4 pending cases (labor/PAGA/data breach claims); 9 concluded cases including wage/hour class actions settled for $2.86M (Khan Kudo), $4.1M (Tapia), $2.75M (Martinez/Minas/Lee consolidated), $900K cash + $500K vouchers (Ross/Scott delivery fee), $38K (Trujillo harassment); NovaDine arbitration where PRG prevailed on some claims and received net award of $5.3M against $1.7M for plaintiff.
Largest disclosed settlement: $4,100,000
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · CliftonLarsonAllen LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
ⓘ These are the parent company's consolidated financials (the parent guarantees the franchisor), not this brand's standalone results — the figure reflects the whole corporate group, not this brand alone.
Supplier relationship · Items 8 & 16
- Franchisor sells you products: Yes
- Kickbacks from required suppliers: Yes
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 75 / 100 verdict
- 01HIGHSignificant litigation exposure: multiple labor code violations (wages, hours, rest breaks) suggest potential franchisor operational compliance issues that may cascade to franchisees
- 02MINORHigh royalty burden: 8% of gross volume PLUS $4,000 minimum per 4-week period ($104,000 annually at minimum) creates cash flow pressure on lower-performing units
- 03MINORUnprotected territory with slow unit growth (4.8% YoY) indicates market saturation risk and potential cannibalization by corporate or competing franchisees
- 04MINORData security incidents create reputational and operational risk, particularly relevant for QSR handling customer payment/delivery information
- 05MEDHigh investment ceiling ($3.28M) with undisclosed net income creates uncertainty about ROI timeline and break-even scenarios
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 8.0% of sales (royalty + ad fund), before rent and labor.
Source: FDD 2025 · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 5 years |
| Allowed renewalsℹ | 1 |
| Territory type | none |
| Protected territory | No |
| Exclusive territoryℹ | No |
| Online sales rightsℹ | Granted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Right of first refusalℹ | Yes |
| RoFR response window | 30 days |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Arbitration location | Los Angeles County, California (location of franchisor's current headquarters) |
| Jury trial waiver | Yes |
| Governing law | CA |
| Litigation count | 13 |
View Item 3 litigation summary
4 pending cases (labor/PAGA/data breach claims); 9 concluded cases including wage/hour class actions settled for $2.86M (Khan Kudo), $4.1M (Tapia), $2.75M (Martinez/Minas/Lee consolidated), $900K cash + $500K vouchers (Ross/Scott delivery fee), $38K (Trujillo harassment); NovaDine arbitration where PRG prevailed on some claims and received net award of $5.3M against $1.7M for plaintiff.
Items 10, 11
Training & Operations
- Classroom training
- 148 hrs
- On-the-job training
- 290 hrs
- Training location
- Panda's company-owned Panda Express Restaurants, Licensee's Certified Training Unit, or other Panda-designated locations
- Ongoing training
- Required
- Time to open
- 12 mo
- From signing to launch
- Site selection
- Franchisee
- Franchisor financing
- Offered
- Item 10
- POS system
- Xpient Iris on NCR RealPOS CX7 or Posiflex XT8315
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Xpient Iris on NCR RealPOS CX7 or Posiflex XT8315
Item 20 · call current owners
Franchisee Contacts
77 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Panda Express · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Panda Express franchise?
The total investment to open a Panda Express franchise ranges from $515K – $3.3M, with an initial franchise fee of $25K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Panda Express franchise owners earn?
According to Item 19 of the Panda Express FDD, the average gross sales per unit is $1.6M. The median is $1.2M. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Item 19 in the Panda Express FDD?
The FDD section where a franchisor may disclose financial performance of its outlets. Disclosure is optional and formats vary; figures are typically gross sales, which is revenue before expenses, not profit. FranchiseVerdict extracts these figures directly from the Panda Express FDD and qualifies whose outlets they describe.
What is Panda Express's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Panda Express (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 Panda Express franchise locations are there?
As of their most recent FDD filing, Panda Express has 2,502 total units in the United States, including 173 franchised units and 2,329 company-owned units. 35 new units were opened in the latest reporting year.
Is Panda Express a good franchise to buy?
FranchiseVerdict rates Panda Express as a A-grade franchise with a verdict score of 75 out of 100 (higher is better), 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
Are you the franchisor?
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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.