Panda Express Franchise Cost, Revenue & Review 2026
- Investment
- $515K – $3.3M
- Disclosed sales
- $1.6M
- gross sales, not profit
- SBA charge-off
- Under 10 loans (1)
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 →
Sources, dates and evidence
FDD issued: · Data extracted: · Last cited check: · Staleness risk: medium - issued 12 to 24 months ago; a newer filing is likely on file
Evidence: strong✓ Investment (Item 7)✓ Item 19 status✓ Units and owners (Item 20)✗ SBA loan coverage✓ Litigation (Item 3)✓ Financial statements (Item 21)✓ Franchisor identityhow this is scored6 of 7 headline figures on this page cite a page of the filing; the rest are marked “Not cited” beside the figure.
Overview
- Investment
- $515K – $3.3M
- 77th pct Service Resta…
- Avg gross sales
- $1.6M
- 29th pct Service Resta…
- Royalty
- 8.0%
- 93rd pct Service Resta…
- Units
- 2,502
- 94th 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 median · 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 78/100 (higher is better).
- GROWTHPositive: net +8 franchised outlets in the latest year (11 opened, 3 closed); 15 signed but not yet open (Item 20).
- LEGAL13 litigation matters disclosed in Item 3, higher than typical. Of these, 0 name the franchisor itself, 13 its parent, affiliates or predecessor. Pending claims are allegations, not findings.
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)
- FDD Item 1, page 9 of the 2025 FDD
- Ultimate parent
- Panda Restaurant Group, Inc. (PRG)
- FDD Item 1, page 9 of the 2025 FDD
- 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 290% 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%
- 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 63% above the quick-service restaurants norm.
Source: FDD 2025 · Item 19
Single-unit · not modelled
Returns at a glance
An FDD discloses gross sales, not profit, and the operating costs that turn one into the other are in no filing. We publish no modelled return for Panda Express until someone supplies them — yours, in the models below.
—
Not modelled yet
An FDD discloses gross sales, not profit. We hold no sourced figure for ad fund rate, COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
Total invested capital · disclosed
$1.9M
Item 7 initial investment plus working capital, as filed — the one figure here that needs no assumption.
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, read against the 30–60% reference band · Yale SOM, Post-MBA Path Exhibit 2 (2023). Below that band a passive index fund likely outperforms; above it the franchisor has pricing power you're subsidizing.
Note: Item 19 revenue is what the franchisor discloses, and it is the top line only — gross sales are not profit. No FDD discloses the operating costs that turn one into the other, so those fields start empty and nothing is modelled until you supply them from your own 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?
Illustrative category typicals — not sourced to any filing, survey or sample. Replace them with figures from franchisee validation calls before you rely on the output.
Unlevered ROIC · per unit
Your modelled return on total invested capital, before any debt financing.
—
An FDD discloses gross sales, not profit. We hold no sourced figure for ad fund rate, COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
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%.
Not modelled yet
An FDD discloses gross sales, not profit. We hold no sourced figure for ad fund rate, COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
A 25-unit return is built on a per-unit EBITDA. Fill in the operating costs in Model A above and this model runs on that figure, or take the whole scenario to the full ROI workbench, where the portfolio and LBO models accept your own per-unit economics directly.
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 19 · large
- Range (low → high)
- $247K→$9.2MCited, not corroborated — printed on page 77 of the 2025 FDD. Nothing else in our record independently restates or re-derives it.
- Cohort dispersion (min → max)
- 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 781 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 median).
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 medians
How Panda Express Compares
Category median of published Quick-Service Restaurants brands that report the figure; the middle half spans the 25th to 75th percentile and n counts the brands behind it. Medians are used because a few very large systems pull an average far from the typical brand. Revenue is disclosed gross sales, not profit.
Is the system healthy?
Source: FDD 2025 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 2,502
- Opened
- 11
- Last reporting year
- Closed
- 3
- Terminated
- 2
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 0.1%
- 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
Last fiscal year · Item 20 exits and transfers
- Terminated
- 2
- Not renewed
- 0
- Transferred
- 13
- Reacquired
- 1
- Franchisor bought back
- Signed, not yet open
- 15
- 0.01 per open outlet · Item 20 Table 5
- Projected new
- 14
- Franchisor's next-year forecast
- 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.
Where the owners are · Item 20 owner list
77 current owners across 22 states.
- CA 16
- TX 10
- GA 6
- VA 6
- FL 5
- MD 5
- NC 4
- SC 4
- HI 3
- IL 3
- DC 2
- LA 2
- +10 more states
Counts only, from the list the franchisor prints in Item 20. Names and phone numbers are for your own due diligence and are not shown here.
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
- Under 10 loans (1)
- Insufficient SBA coverage: 1 loan, rate hidden below 10
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- Under 10 loans (1)
- 5-yr charge-off
- Under 10 loans (1)
- 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)
Subject: the franchisor is a named party (defendant).
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)
Total Net Revenues for the thirteen periods ended December 28, 2024: Royalty Income $24,916,622; License Fees $2,378,044; Initial Fees $816,928; Rental Income $145,900; Restaurant Income $10,235; Miscellaneous Income (Loss) $(4,870). Consolidated financials of Citadel Panda Express, Inc. and Subsidiary.
ⓘ 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 78 / 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
Litigation case detail13 matters · Item 3
Litigation cases
Parent, affiliates and predecessor
Pending (4)
Americo Pena, as an individual and on behalf of all others similarly situated v. Panda Restaurant Group, Inc., Panda Express, Inc., and Does 1 - 50
pendingThird-party plaintiff · Panda Restaurant Group, Inc. and Panda Express, Inc. · filed 2024-06-24 · Superior Court of the State of California, County of Los Angeles · 24STCV15775
“Case No. 24STCV15775). On June 24, 2024 Plaintiff filed a class action asserting: (1) Unpaid Wages; (2) Inaccurate Wage Statements; (3) Unfair or Unlawful Business Practices; and (4) Violation of the California Labor Code.”Page 15 of the 2025 FDD, Item 3
Aveon Goosby v. Panda Restaurant Group, Inc./Panda Express, Inc. (No. 23STCV31730)
pendingThird-party plaintiff · Panda Restaurant Group, Inc. (PRG) · filed 2023-12-28 · California Superior Court, County of Los Angeles · 23STCV31730
“Case No. 23STCV31730). In a separate individual action, on December 28, 2023, former associate, Aveon Goosby filed a complaint against PRG alleging: (i) Whistleblower Retaliation; (ii) Wrongful Termination and (iii) Intentional Infliction of Emotional Distress.”Page 14 of the 2025 FDD, Item 3
Aveon Goosby v. Panda Restaurant Group, Inc./Panda Express, Inc.
pendingThird-party plaintiff · Panda Restaurant Group, Inc. (PRG) / Panda Express, Inc. (PEI) · California Superior Court, County of Los Angeles · 23STCV15228
“Case No. 23STCV15228). On 5/23/23 we received Plaintiff’s written PAGA notice for claims against Panda. The notice alleges Panda violated Labor Code Section 1391 by employing Plaintiff and other similarly situated associates for hours beyond what is legally allowed.”Page 14 of the 2025 FDD, Item 3
Marc-Antony Halliday v. Panda Restaurant Group, Inc.
pendingThird-party plaintiff · Panda Restaurant Group, Inc. (PRG) · Superior Court of the State of California, County of Los Angeles · 24STCV12667
“Marc-Antony Halliday v. Panda Restaurant Group, Inc. (Superior Court of the State of California, County of Los Angeles, Case No. 24STCV12667). On 5/16/24, former associate Marc- Anthony Halliday filed class action lawsuit against PRG alleging claims for: (1) negligence; (2) negligence per se; (3) declaratory judgment; (4) violation of California Consumer Privacy Act”Page 14 of the 2025 FDD, Item 3
Outcome:“The Halliday lawsuit is one of nine class action lawsuits filed against PRG arising out of a data security incident which occurred between March 7, 2024, and March 10, 2024. On October 1, 2024, the parties agreed to a conditional global settlement of all the lawsuits.” (page 15)
Concluded (9)
Yaritza Martinez v. Panda Express, Inc., Panda Restaurant Group, Inc., Panda Express, LLC, and DOES 1-10
settledThird-party plaintiff · Panda Express, Inc. and Panda Restaurant Group, Inc. (parents) with Panda Express, LLC (affiliate) · filed 2023-02-09 · California Superior Court, County of Solano · FCS059627
“On February 9, 2023, Plaintiff filed a lawsuit regarding her wage and hour PAGA claims, including: (i) Failure to Pay Minimum Wages, Including Overtime; (ii) Failure to Provide Lawful Meal Periods; (iii) Failure to Authorize and Permit Rest Periods”Page 17 of the 2025 FDD, Item 3
Outcome:“On December 16, 2024, the Court approved a settlement of $2,752,965.”
Jeffrey Lee v. Panda Restaurant Group, Inc.
settledThird-party plaintiff · Panda Express, Inc. (PEI, a parent) with Panda Express, LLC and Panda Express (P.R.), Inc. (affiliates); the caption names Panda Restaurant Group, Inc. · filed 2022-03-16 · County of San Francisco Superior Court · CGC-22-599478
“Jeffrey Lee v. Panda Restaurant Group, Inc. (County of San Francisco Superior Court PAGA, Case No. CGC-22-599478), On March 16, 2022, Plaintiff filed a class action in the San Francisco County Superior Court against Panda Express, LLC, Panda Express, Inc. and Panda Express (P.R.), Inc. (“Defendants”), alleging (i) Unfair competition; (ii) failure to pay minimum wages”Page 17 of the 2025 FDD, Item 3
Outcome:“Defendants defended the action, but to manage risk, elected to settle the matter, as described in Yaritza Martinez v. Panda Express, Inc., Panda Restaurant Group, Inc., Panda Express, LLC, a”
Jeff Ross and Roxanne Oliveira v. Panda Restaurant Group, Inc., and Does 1-50
settledThird-party plaintiff · Panda Restaurant Group, Inc. (PRG) · filed 2021-01-29 · California Superior Court, County of Los Angeles · 21STCV03662
“Case No. 21STCV03662). On January 29, 2021, guests Jeff Ross and Roxanne Oliveira filed a class action against PRG alleging: (i) unfair competition in violation of California”Page 16 of the 2025 FDD, Item 3
Outcome:“The parties settled the matter for $900,000 in cash and up to $500,000 in vouchers, to be distributed amongst those who elected to participate in the settlement.”
Lesly Minas v. Panda Express, Inc.; Panda Restaurant Group, Inc., and Does 1-100
settledThird-party plaintiff · Panda Express, Inc. and Panda Restaurant Group, Inc. · filed 2021-08-11 · California Superior Court, Count of Los Angeles-Central District · 21STCV29628
“Lesly Minas v. Panda Express, Inc.; Panda Restaurant Group, Inc., and Does 1-100 (California Superior Court, Count of Los Angeles-Central District, Case No. 21STCV29628). On August 11, 2021, former associate Lesly Minas filed a class action against PRG alleging: (i) failure to pay wages for all hours of work at the legal minimum wage rate in violation of California Labor”Page 16 of the 2025 FDD, Item 3
Outcome:“PEI and PRG defended the action, but to manage risk, elected to settle the matter, as described in Yaritza Martinez v. Panda Express, Inc., Panda Restaurant Group, Inc., Panda Express, LLC, and DOES 1” (page 17)
Natasha Scott v. Panda Restaurant Group, Inc., and Does 1-50
settledThird-party plaintiff · Panda Restaurant Group, Inc. (PRG) · filed 2021-07-01 · U.S. District Court - Central District of California · 2:21-cv-05368-MCS-GJS
“On July 1, 2021, guest Natasha Scott filed a class action against PRG alleging: (i) unfair competition in violation of California’s Unfair Competition Law, California Business & Professions Code §17200 et seq.; (ii) violation of California’s Consumer Legal Remedies Act, California Civil Code §1750 et seq.; and (iii) violation of Michigan Consumer Protection Act”Page 16 of the 2025 FDD, Item 3
Outcome:“The parties settled the matter for $900,000 in cash and up to $500,000 in vouchers, to be distributed amongst those who elected to participate in the settlement.”
Javier Lopez Tapia v. Panda Express, LLC, Panda Express, Inc., Panda Express (P.R.), Inc., and Does 1 through 50
settledThird-party plaintiff · Panda Express, Inc. (PEI, a parent) with Panda Express, LLC and Panda Express (P.R.), Inc. (affiliates) · filed 2016-01-21 · California Superior Court, County of Los Angeles · BC607846
“Case No. BC607846). On January 21, 2016, former associate Javier Tapia filed a class action against PEL, PEI, and PE (PR) ( “Panda”) alleging: (i) unfair competition in violation of California Business & Professions Code”Page 16 of the 2025 FDD, Item 3
Outcome:“Panda defended the action, but to manage risk, elected to settle the matter for $4.1 million, which was approved by the court on November 21, 2018”
Carmelo Trujillo v. Panda Restaurant Group, Inc., Panda Express, LLC, Panda Express, Inc., Panda Express (P.R.), Inc, and Does 1 through 50
settledThird-party plaintiff · Panda Restaurant Group, Inc., Panda Express, Inc. (parents) with Panda Express, LLC and Panda Express (P.R.), Inc. (affiliates) · filed 2015-10-14 · California Superior Court, County of San Diego · 37-2015-00034660-CU-WT-CTL
“Case No. 37-2015-00034660-CU-WT-CTL). On October 14, 2015, Carmelo Trujillo, a former associate working as kitchen help at a Panda Inn, located in San Diego, California, filed a suit against PRG, PEI, PE (PR) and PEL (together “Panda”) alleging: (i) harassment and hostile work environment”Page 15 of the 2025 FDD, Item 3
Outcome:“To manage risk on or about March 18, 2016, Panda entered into a settlement agreement and release of claims for $38,000” (page 16)
Khan Kudo, individually and on behalf of all persons similarly situated v. Panda Express, Inc. and Panda Restaurant Group, Inc.
settledThird-party plaintiff · Panda Restaurant Group, Inc. (PRG) and Panda Express, Inc. (PEI) · filed 2009-01-26 · United States District Court, Southern District of New York · 09 CV 0712-CS
“Case No.: 09 CV 0712-CS). On January 26, 2009, Khan Kudo, a former General Manager, filed a lawsuit against PRG and PEI on behalf of himself and current and former General Managers of Panda Express outside of California, alleging that they were entitled to unpaid overtime wages and liquidated damages under the Fair Labor Standards Act”Page 15 of the 2025 FDD, Item 3
Outcome:“PRG and PEI defended the action, but to manage risk, elected to settle the matter (on a claims-made basis) with the entire class, in an aggregate amount equal to approximately $2.98 million, which was approved by the court on June 26, 2015. After the claims process, the settlement amount was reduced to approximately $2.86 million.”
NovaDine, Inc. v. Panda Restaurant Group, Inc.
judgmentThird-party plaintiff · Panda Restaurant Group, Inc. (PRG) · JAMS Arbitration
“NovaDine, Inc. v. Panda Restaurant Group, Inc. (JAMS Arbitration), On 2/10/23, Plaintiff, PRGs former online ordering vendor filed its amended Arbitration demand against Panda Restaurant Group, Inc. (“PRG”), alleging: (i) Breach of Contract; (ii) Fraudulent Inducement; and (iii) Unlawful Disclosure of Trade Secrets.”Page 17 of the 2025 FDD, Item 3
Outcome:“Novadine was awarded $1.7MM for the breach of contract, $0 for unlawful disclosure of trade secrets, but was also ordered to pay PRG $5.3MM. The award was finalized by the arbitrator on April 22, 2024.” (page 18)
Item 3 lists the litigation the franchisor must disclose; a matter against a parent, an affiliate or a named officer is not a matter against the franchisor, and pending claims are allegations, not findings.
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 | No territory protection |
| 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
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.
Who owns Panda Express?
Panda Express is franchised by Citadel Panda Express, Inc.. Its parent company is Panda Express, Inc. (PEI). The ultimate parent named in the FDD is Panda Restaurant Group, Inc. (PRG). Source: FDD Item 1, 2025 filing.
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. 11 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 78 out of 100 (higher is better). The grade is a deterministic score built from six weighted dimensions — financial health, unit economics, unit growth, scale, legal, and transparency — then calibrated against SBA loan charge-off rates and FDD age. Transparency is one of the six, so a filing that discloses less scores lower on that dimension than one that discloses more. 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.
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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.