Bottom line
- Total investment $318K – $740K including a $25K franchise fee, 5.0% ongoing royalty.
- Average unit revenue of $917K/year (median $834K). Estimated payback in 2.5 years.
- Rated STRONG with a risk score of 44/100. SBA loan default rate of 0.0% across 169 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 Pizza Factory unit return on the cash you put in?
Unlevered ROIC · per unit
16%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Pizza Factory units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$550K
on $2.8M purchase
Total debt
$2.2M
SBA $1.4M + senior + seller note
Overview
About
Pizza Factory franchisees operate casual pizzerias producing fresh dough, specialty pizzas, and Italian cuisine for dine-in, takeout, and delivery customers. Day-to-day operations include managing kitchen staff, maintaining quality standards, inventory management, and local marketing to build customer loyalty in their 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 · 14 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
Pizza Factory presents moderate-to-cautionary risk: litigation history and lack of financial transparency are concerning, but stable unit count, reasonable royalty rate, and protected territories partially offset these issues.
Score breakdown · what drove the 44 / 100 rating
- 01HIGHLitigation history: 2019 breach of contract lawsuit with fraud/misrepresentation allegations settled for $65,000 in 2021 raises concerns about franchisor business practices and relationship management
- 02MINORSlow unit growth: 6.8% YoY growth is modest for a pizza franchise and suggests difficulty recruiting/retaining franchisees or market saturation
- 03MINORNo Item 19 financial disclosure: Franchisor does not provide average unit volume data to prospective franchisees, limiting transparency on revenue claims
- 04MINORWide investment range: $318,000-$740,000 spread (133% variance) suggests highly variable startup costs and unclear requirements for different unit types
- 05MINORNet income margin concern: $214,430 net income on $916,995 revenue (23.4% margin) needs verification—validate if this is representative and how 5% royalty impacts bottom line
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
15 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Pizza Factory · FDD (2025) PDF