Bottom line
- Total investment $279K – $625K including a $50K franchise fee, 6.0% ongoing royalty.
- No Item 19 financial performance data disclosed — the franchisor chose not to publish revenue figures.
- Rated CAUTION with a risk score of 72/100. SBA loan default rate of 0.0% across 6 loans (below the industry average).
- Auditor disclosed a going-concern note — flagged doubt about the franchisor's ability to continue operations. Verify against the latest FDD.
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 Qargo Coffee unit return on the cash you put in?
Unlevered ROIC · per unit
14%
Below typical band (30–60%)
Overview
About
Franchisees operate Qargo Coffee retail locations, likely coffee and beverage service businesses serving customers in their protected territory. Day-to-day operations include inventory management, barista/staff management, customer service, and compliance with brand standards. Franchisees pay 6% royalties on gross revenue while bearing all operational costs with no disclosed profitability benchmarks.
Item 7 · what it costs
The Vitals
Item 19
Financial Performance
This franchisor did not disclose financial performance representations in Item 19, or our extractor could not parse them.
Item 20 · unit dynamics
The Growth Chart
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 7 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
Qargo Coffee presents high investment risk: recent FTC fraud settlement, non-transparent financials, micro-scale system (6 units), going concern issues, and unproven unit economics.
Score breakdown · what drove the 72 / 100 rating
- 01HIGHFTC litigation in October 2024 for material misstatements about time-to-open and bankruptcy disclosures—indicates potential deceptive practices
- 02MINORNo average unit volume (AUV) or net income disclosure—inability to assess actual profitability or ROI on $278,500-$624,500 investment
- 03MEDOnly 6 units system-wide with 200% YoY growth suggests extremely small, nascent franchisor with limited track record and data reliability
- 04MINOROfficers named in FTC complaint (Mark Bastorous, Bernadette Bastorous, Samir Shenouda) raise questions about management credibility and oversight
- 05HIGHGoing concern status true—signals potential financial instability at corporate level affecting support and franchisor viability
- 06MED6% royalty rate on undisclosed revenue with no Item 19 financial performance representations limits franchisee ability to validate earnings potential
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
Qargo Coffee · FDD (2025) PDF