PJ’s Coffee of New Orleans Franchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
PJ's Coffee of New Orleans is a specialty-coffee franchise serving New Orleans-style coffee, espresso drinks, cold brew, and pastries. Franchisees run cafes and drive-thrus managing baristas, beverage prep, and service.
FranchiseVerdict summary · 2026
A PJ’s Coffee of New Orleans franchise requires a total initial investment of $915K – $1.7M, including a $15K – $40K franchise fee and an ongoing 5.0% royalty[2]. Per the 2025 FDD, average unit revenue was $590K[2]. SBA 7(a) loans show a 0.0% charge-off rate across 70 loans[1]. 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
- $915K – $1.7M
- 92nd pct Service Resta…
- Avg gross sales
- $590K
- 5th pct Service Resta…
- Royalty
- 5.0%
- 11th pct Service Resta…
- Units
- 182
- 83rd pct Service Resta…
- SBA charge-off
- 0.0%
- % of SBA 7(a) loans not repaid · median varies by category
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 $915K – $1.7M including a $40K franchise fee, 5.0% ongoing royalty.
- RETURNSAverage unit revenue of $590K/year (median $534K).
- RISKVerdict A (Strongest tier), verdict score 90/100 (higher is better). SBA loan charge-off rate of 0.0% across 70 loans (well below the franchise average, based on all SBA 7(a) franchise lending, 2010–2025).
- GROWTHSystem growing at 26.1% CAGR over 3 years with 182 total units. Strong expansion trajectory.
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- New Orleans Brew, L.L.C.
- Parent company
- None
- Predecessor
- PJ's USA, Inc.
- Prior franchisor entity
- CEO title
- President
- David Mesa, Jr.
- Founder active
- Yes
- Original founder still leading the business
- Incorporated in
- LA
- HQ
- 4480 LA-22, Suite 2, Mandeville, Louisiana 70471
- Auditor
- Reagan & Reagan CPA, LLC
- Audited financials
- Franchisor revenue
- $5.8M
- vs $5.3M prior year
- Management churn noted
- Frequent turnover
- Item 2 disclosed frequent executive changes
Affiliated brands
- New Orleans Roast
- company that will roast and distribute coffee beans
Other brands the franchisor or its parent operates (Item 1).
Overview
About
- CEO
- David Mesa, Jr.
- Headquarters
- LA
- Founded
- 1989
- FDD year
- 2025
- States available
- 14
Can you afford it, and what does the money buy?
Entry cost runs 98% above the typical quick-service restaurants franchise.
Source: FDD 2025 · Items 5–7
Full Item 7 breakdown17 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Fee | $15K | $40K | |
| Real Estate Lease Deposit for Premises | $3K | $13K | |
| Furniture, Fixtures, and Equipment | $86K | $243K | |
| Opening Advertising | $13K | $13K | |
| Travel and Living Expenses While Training | $4K | $5K | |
| Insurance | $3K | $8K | |
| Other Prepaid Expenses (Deposits, Licenses, Permits) | $2K | $8K | |
| Opening Inventory | $10K | $14K | |
| Exterior Signage | $4K | $30K | |
| Free Standing Building or Leasehold Improvements | $80K | $1.2M | |
| Small Wares | $8K | $10K | |
| POS System & Back-office Computer System | $3K | $6K | |
| Legal, Accounting & Organizational Costs | $3K | $5K | |
| Construction Drawings | $2K | $75K | |
| Additional Funds | $30K | $30K | |
| Initial Franchise Fee (Multi-Unit Option) | $15K | $15K | |
| Store Development Cost (Multi-Unit Option) | $248K | $1.7M | |
| Total initial investment | $525K | $3.4M |
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
- $915K – $1.7M
- Bottom third — review vs category
- Liquid capital req'd
- $30K – $30K
- Middle of category vs category
- Franchise fee
- $15K – $40K
- Middle of category vs category
- Royalty
- 5.0%
- percentage · typical 6–8%
- Ad fund
- 2.0%
- typical 3–5%
- Total fee load
- 7.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 5.0% of gross sales |
| Marketing / ad fund | 2.0% of gross sales |
| Technology fee | $141 |
| Transfer fee | $15K |
| Renewal fee | $0 |
| Inventory (initial) | $10K – $14K |
| Total fee load | 7.0% of rev |
What do units actually make?
Average unit sales run 51% below 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
$88K
15.0% margin
Unlevered ROIC
7%
EBITDA / total invested capital
Payback
15.1 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 PJ’s Coffee of New Orleans unit return on the cash you put in?
Unlevered ROIC · per unit
Estimated return on your total franchise investment, before any debt financing.
7%
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 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
$943K
on $4.7M purchase
Total debt
$3.8M
SBA $2.4M + 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
- $590K
- Per unit, per year
- Median gross sales
- $534K
Gross sales are revenue before expenses — not profit. Actual owner earnings depend on rent, labor, royalties, marketing fees, and debt service.
- Item 19 type
- sales and p and l
- Sample size
- 117 outlets
- vs category median 20 · large
- Range (low → high)
- $184K→$1.3M
- Cohort dispersion (min → max)
- Quartile band
- $331K→$1.0M
- Bottom 25% → top 25%
- Reporting year
- 2024
- Fiscal year the figures cover
- Source filing
- FDD 2025
- Disclosed in the 2025 filing, covering 2024
- Transparency
- 10 / 10
- vs category median 4 / 10 · above
Compared against 782 Quick-Service Restaurants brands
Revenue is only 0.5x 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 $590K/year in gross sales. Revenue-to-investment ratio: 0.5x.
Fee burden
Total ongoing fee load of 7.0% (near the Quick-Service Restaurants average).
Disclosure
Transparency score 10/10 — this franchisor discloses detailed breakdowns (quartiles, segments, or cohort data). Buyers can model unit economics with higher confidence.
Operator retention
System expanding at 26.1% CAGR over 3 years across 182 units — operators are staying and new ones are joining.
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 PJ’s Coffee of New Orleans Compares
Is the system healthy?
Source: FDD 2025 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 182
- Opened
- 22
- Last reporting year
- Closed
- 7
- Terminated
- 0
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 4.1%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (3-yr)
- +26.1%
- Net unit change over 3 years
- 3-yr CAGR
- +26.1%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 22
- Closed (3yr)
- 7
- Terminated (3yr)
- 0
- Non-renewed (3yr)
- 0
- Transfers (3yr)
- 18
- Reacquired (3yr)
- 0
- Franchisor bought back
- Projected new
- 30
- Franchisor's next-year forecast
- Transfer rate
- 9.9%
- Owners selling to other franchisees
- Termination rate
- 0.5%
- Franchisor-initiated terminations
- Ceased ops
- 4.9%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 17 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 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 70
- Loan volume
- $31.4M
- Median loan
- $448K
- average
- Charge-off rate
- 0.0%
- rates vary by category · see methodology
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
- 0.0%
- Loans approved 2021+
- Active lenders
- 31
- Defaults
- 0
- Typical loan rate
- 8.1%
- avg rate to borrowers
- vs industry
- N/A
- Jobs supported
- 1,149
- Lender concentration
- N/A
Borrower mix: 88% went to startups / new businesses, 12% to established operators
Top lenders financing PJ’s Coffee of New Orleans franchisees
Showing 3 of 31 lenders. The full breakdown — every lender, state distribution, interest rates & risk ratings — is in the SBA Lending Report below.
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into PJ’s Coffee of New Orleans's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 5 lenders with concentration factor
- Per-state charge-off rates across 10 states
- Startup risk premium and job creation velocity
- 11-year lending trend
- SBA 504 real estate/equipment data
Instant access. No subscription.
With a 0.0% charge-off rate across 70 loans, banks have historically viewed this brand favorably for lending.
What could kill this investment?
SBA loans charge off at 0.0% — 100% below the 16.0% national norm, i.e. lower lender-observed risk.
Source: SBA 7(a) FOIA · FDD Items 3, 21
Risk analysis
FranchiseVerdict rating + FDD Items 3, 4, 8, 16, 21
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.
Litigation (Item 3)
1) Whitetail 26, LLC et al. v. New Orleans Brew, LLC (AAA arbitration, filed Dec 2023) — former franchisees alleged Louisiana UTPA violations, fraud in inducement, misrepresentation, breach of contract; arbitrator awarded damages for investment losses but rejected fraud/misrepresentation claims; final award June 2025 not yet confirmed by court. 2) Unique Marie Hankston v. Delaware North d/b/a PJ's Coffee House (La. Civ. Dist. Ct. filed Mar 2025) — plaintiff alleged illness from contaminated food at a franchisee-operated airport location; affiliate Ballard Brands named defendant; New Orleans Brew LLC not named.
Largest disclosed settlement: $1
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Reagan & Reagan CPA, LLC
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 90 / 100 verdict
- 01HIGHActive litigation involving bad faith termination claims (Whitetail 26) and food contamination personal injury lawsuit (Unique Marie Hankston) suggests operational/legal vulnerabilities
- 02MINORModest unit growth of 8.3% YoY in competitive coffee market raises questions about expansion difficulty and franchisee recruitment challenges
- 03HIGHHigh 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
What are you signing up for?
Ongoing fees run about 7.0% 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 | 10 years |
| Allowed renewalsℹ | 3 |
| Territory type | protected |
| Protected territory | Yes |
| Exclusive territoryℹ | No |
| Territory radius | 2 mi |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 50 mi |
| Right of first refusalℹ | Yes |
| RoFR response window | 15 days |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Curable defaultsℹ | 3 |
| Mandatory arbitration | Yes |
| Arbitration location | Louisiana |
| Jury trial waiver | No |
| Governing law | LA |
| Litigation count | 2 |
View Item 3 litigation summary
1) Whitetail 26, LLC et al. v. New Orleans Brew, LLC (AAA arbitration, filed Dec 2023) — former franchisees alleged Louisiana UTPA violations, fraud in inducement, misrepresentation, breach of contract; arbitrator awarded damages for investment losses but rejected fraud/misrepresentation claims; final award June 2025 not yet confirmed by court. 2) Unique Marie Hankston v. Delaware North d/b/a PJ's Coffee House (La. Civ. Dist. Ct. filed Mar 2025) — plaintiff alleged illness from contaminated food at a franchisee-operated airport location; affiliate Ballard Brands named defendant; New Orleans Brew LLC not named.
Items 10, 11
Training & Operations
- Classroom training
- 25 hrs
- On-the-job training
- 35 hrs
- Training location
- Mandeville, Louisiana (initial); Franchisee's location (field training)
- Ongoing training
- Required
- Field support
- 60 hrs/yr
- On-site visits per year
- Time to open
- 12 mo
- From signing to launch
- Site selection
- Franchisee with Franchisor approval
- Franchisor financing
- Not offered
- Item 10
- POS system
- PJ's approved POS system
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: PJ's approved POS system
Item 20 · call current owners
Franchisee Contacts
125 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
PJ’s Coffee of New Orleans · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a PJ’s Coffee of New Orleans franchise?
The total investment to open a PJ’s Coffee of New Orleans franchise ranges from $915K – $1.7M, with an initial franchise fee of $40K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do PJ’s Coffee of New Orleans franchise owners earn?
According to Item 19 of the PJ’s Coffee of New Orleans FDD, the average gross sales per unit is $590K. The median is $534K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Item 19 in the PJ’s Coffee of New Orleans 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 PJ’s Coffee of New Orleans FDD and qualifies whose outlets they describe.
What is PJ’s Coffee of New Orleans's franchise failure rate?
Based on SBA 7(a) loan data, PJ’s Coffee of New Orleans has a charge-off rate of 0.0% across 70 loans, meaning 0.0% of franchise loans were charged off. Charge-off rates are one proxy for franchise risk, though they do not capture all closures. This data comes from FOIA-sourced SBA lending records.
How many PJ’s Coffee of New Orleans franchise locations are there?
As of their most recent FDD filing, PJ’s Coffee of New Orleans has 182 total units in the United States, including 169 franchised units and 0 company-owned units. 22 new units were opened in the latest reporting year.
Is PJ’s Coffee of New Orleans a good franchise to buy?
FranchiseVerdict rates PJ’s Coffee of New Orleans as a A-grade franchise with a verdict score of 90 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.