Rachel’s Kitchen
Bottom line
- Total investment $298K – $816K including a $40K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $1.7M/year (median $1.7M).
- Rated MODERATE with a risk score of 67/100. SBA loan default rate of 0.0% across 5 loans (below the industry average).
- 88% of franchisees own multiple units — high repeat-buyer signal suggests strong unit 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 Rachel’s Kitchen unit return on the cash you put in?
Unlevered ROIC · per unit
41%
In Yale's "attractive" band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Rachel’s Kitchen units return on equity?
Equity IRR · 5-yr
36.3%
4.70× MOIC
Year-1 DSCR
2.27×
EBITDA ÷ debt service
Equity required
$4.6M
on $13.8M purchase
Total debt
$9.1M
SBA $5.0M + senior + seller note
Overview
About
Rachel's Kitchen franchisees operate health-focused quick-service or casual dining restaurants featuring prepared meals, likely organic/fresh ingredients. Daily operations include food preparation, customer service, inventory management, staffing, and compliance with the franchisor's proprietary recipes and operational 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 · 8 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
Rachel's Kitchen presents high risk due to going concern status, micro-scale operations (7 units), zero transparency on profitability, and undisclosed growth dynamics.
Score breakdown · what drove the 67 / 100 rating
- 01HIGHGoing Concern status indicates the franchisor itself may be financially unstable or facing viability questions
- 02MINOROnly 7 units systemwide suggests a micro-franchise with minimal scale, support infrastructure, and survival track record
- 03MEDNo Item 19 (Average Unit Volume) disclosed despite $1.7M average revenue claim — lack of transparency on profitability
- 04MEDHigh investment range ($298K-$816K) with no disclosed net income creates uncertainty on actual returns and payback period
- 05MINORUnknown unit growth trajectory — no data on openings/closures suggests potential contraction or stagnation
- 06MINORExtremely small franchise system limits purchasing power, brand recognition, marketing reach, and operational support depth
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
9 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Rachel’s Kitchen · FDD (2024) PDF