PJ’s Coffee of New Orleans
Bottom line
- Total investment $263K – $1.7M including a $40K franchise fee, 5.0% ongoing royalty.
- Average unit revenue of $590K/year (median $534K). Estimated payback in 6.6 years.
- Rated STRONG with a risk score of 44/100. SBA loan default rate of 0.0% across 126 loans (below the industry average).
- System growing at 26.1% CAGR over 3 years with 182 total units — strong expansion trajectory.
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 PJ’s Coffee of New Orleans unit return on the cash you put in?
Unlevered ROIC · per unit
6%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 PJ’s Coffee of New Orleans units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$472K
on $2.4M purchase
Total debt
$1.9M
SBA $1.2M + senior + seller note
Overview
About
PJ's Coffee franchisees operate quick-service coffee shops (espresso, drip coffee, pastries, light food) in high-traffic locations (retail, airport, campus). Day-to-day operations include inventory management, barista scheduling/training, customer service, in-store marketing, and compliance with brand standards (recipes, cleanliness, POS systems).
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 · 21 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
PJ's Coffee presents moderate-to-caution risk: litigation history raises governance concerns, claimed unit economics lack transparency, and modest growth in a saturated segment warrant deep validation.
Score breakdown · what drove the 44 / 100 rating
- 01HIGHActive litigation involving bad faith termination claims (Whitetail 26) and food contamination personal injury lawsuit (Unique Marie Hankston) suggests operational/legal vulnerabilities
- 02MINORWide investment range ($262.5K–$1.7M) indicates inconsistent unit economics and unclear cost structure across locations
- 03MINORNet profit margin of 25.3% ($149K on $589K revenue) appears optimistic given 5% royalty, labor, rent, and COGS in QSR; claims lack third-party validation (no Item 19 financial statement)
- 04MINORModest unit growth of 8.3% YoY in competitive coffee market raises questions about expansion difficulty and franchisee recruitment challenges
- 05HIGHHigh franchise fee ($40K) combined with litigation history may deter qualified candidates, creating pressure to relax vetting standards
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
72 numbers
One-time purchase · CSV download · Validation questions included
FDD download
PJ’s Coffee of New Orleans · FDD (2025) PDF