Bottom line
- Total investment $315K – $906K including a $35K franchise fee, 6.5% ongoing royalty.
- Average unit revenue of $365K/year (median $328K).
- Rated STRONG with a risk score of 46/100. SBA loan default rate of 0.0% across 245 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 Rita’s unit return on the cash you put in?
Unlevered ROIC · per unit
7%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Rita’s units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$402K
on $2.0M purchase
Total debt
$1.6M
SBA $1.0M + senior + seller note
Overview
About
Rita's franchisees operate seasonal or year-round frozen Italian ice and custard retail locations, typically in high-traffic strip centers or standalone storefronts. Day-to-day operations include product preparation, customer service, inventory management, local marketing, and staff scheduling. Revenue is highly dependent on weather, foot traffic, and local competition.
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 · 10 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
Rita's presents moderate-to-cautionary risk due to undisclosed profitability data, minimal unit growth, historical litigation over disclosures, and unclear ROI path for new franchisees.
Score breakdown · what drove the 46 / 100 rating
- 01MEDNet income not disclosed in FDD Item 19 — unable to validate profitability claims against $365K average revenue
- 02MEDUnit growth only 3.3% YoY — suggests stagnant or mature system with limited expansion momentum
- 03HIGHThree separate litigation actions disclosed (TCPA, development fee dispute, multi-franchisee California action) — indicates historical franchisor-franchisee conflict and disclosure concerns
- 04MINORHigh investment range ($315K–$905K) with 6.5% royalty creates significant break-even threshold; profitability unclear without Item 19 data
- 05MINORSeasonal frozen dessert business model carries revenue volatility risk not addressed in available metrics
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
20 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Rita’s · FDD (2025) PDF