Bottom line
- Total investment $353K – $685K including a $20K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $397K/year.
- Rated MODERATE with a risk score of 64/100. SBA loan default rate of 0.0% across 91 loans (below the industry average).
- System contracting at -42.9% CAGR over 3 years. Investigate whether closures are franchisor-driven (consolidation) or franchisee-driven (economics).
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 Pita Pit unit return on the cash you put in?
Unlevered ROIC · per unit
10%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Pita Pit units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$555K
on $2.8M purchase
Total debt
$2.2M
SBA $1.4M + senior + seller note
Overview
About
Franchisees operate quick-service pita/Mediterranean restaurants, managing daily food preparation, staffing, POS systems, and customer service. Operations typically span breakfast to dinner with emphasis on customizable menu items and fast-casual positioning. Franchisees handle local marketing, inventory management, and compliance with corporate standards across a protected territory.
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 · 29 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
Pita Pit's 24% annual unit decline combined with undisclosed profitability and high investment requirements signals a franchise system in contraction with questionable unit economics.
Score breakdown · what drove the 64 / 100 rating
- 01MEDUnit count declined 24.3% YoY (58 units remaining) — indicates systemic contraction and potential franchisee dissatisfaction
- 02MINORNo net income disclosure despite $396k average revenue — suggests thin or negative margins after operating expenses
- 03MINORHigh investment-to-revenue ratio (53-173% of initial investment annually) with 6% royalty burden leaves minimal profit potential
- 04HIGHNo going concern statement is positive, but dramatic unit loss suggests underlying business model stress
- 05MINORQuick-service restaurant sector facing labor cost, food inflation, and consumer traffic pressures not addressed in disclosure
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
80 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Pita Pit · FDD (2025) PDF