Rusty Taco Franchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
Rusty Taco is a fast-casual franchise serving street-style tacos, breakfast tacos, and margaritas. Franchisees run the restaurants, managing food prep, staffing, and counter service.
FranchiseVerdict summary · 2026
A Rusty Taco franchise requires a total initial investment of $528K – $1.1M, including a $30K franchise fee and an ongoing 5.0% royalty[2]. Per the 2025 FDD, average unit revenue was $1.1M[2]. FranchiseVerdict grade: C (Average), an editorial assessment, not investment advice. Run a live ROI scan →
Data last verified · figures per the 2025 FDD issuance
Overview
- Investment
- $528K – $1.1M
- 79th pct Service Resta…
- Avg gross sales
- $1.1M
- 17th pct Service Resta…
- Royalty
- 5.0%
- 11th pct Service Resta…
- Units
- 37
- 60th pct Service Resta…
- SBA charge-off
- N/A
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 $528K – $1.1M including a $30K franchise fee, 5.0% ongoing royalty.
- RETURNSAverage unit revenue of $1.1M/year.
- RISKVerdict C (Average), verdict score 46/100 (higher is better).
- FLAG5 units terminated last reporting year (13.5% of the system). Ask existing franchisees why.
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- Rusty Taco Franchising, LLC
- Parent company
- Rusty Taco Parent LLC
- Ultimate parent
- Gala Family, LP
- Predecessor
- Rusty Taco, Inc.
- Prior franchisor entity
- CEO title
- Chairman and Chief Executive Officer
- Anand Gala
- Incorporated in
- Delaware
- HQ
- 5412 W. Plano Pkwy., Suite 100, Plano, Texas 75093
- Auditor
- Baker Tilly US, LLP
- Audited financials
- Franchisor revenue
- $1.7M
- vs $2.1M prior year
Independent franchisee associations
- Franchise Advisory Council (FAC)
Franchisee-led councils or alliances disclosed in Item 20. Indicates operator voice.
Affiliated brands
- RT Gift Card
Other brands the franchisor or its parent operates (Item 1).
Overview
About
- CEO
- Anand Gala
- Headquarters
- TX
- Founded
- 2014
- FDD year
- 2025
- States available
- 12
Can you afford it, and what does the money buy?
Entry cost runs 26% above the typical quick-service restaurants franchise.
Source: FDD 2025 · Items 5–7
Full Item 7 breakdown14 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Fee | $30K | $30K | |
| Rent and Security Deposit | $3K | $10K | |
| Utility Deposits | $6K | $10K | |
| Construction, Remodeling and Leasehold Improvements | $253K | $621K | |
| Permits and Licenses | $3K | $7K | |
| Architect Fee | $20K | $60K | |
| Furniture, Fixtures, Equipment, and Signage | $163K | $250K | |
| Initial & Opening Training Costsnot refundable | $0 | $15K | |
| Computer System | $2K | $5K | |
| Initial Inventory/Supplies | $7K | $10K | |
| Professional Services | $5K | $15K | |
| Initial Advertising and Marketing Expenses | $10K | $15K | |
| Insurance | $6K | $30K | |
| Additional Funds (3 months) | $20K | $50K | |
| Total initial investment | $528K | $1.1M |
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
- $528K – $1.1M
- Bottom third — review vs category
- Liquid capital req'd
- $20K – $50K
- Top 40% of category vs category
- Franchise fee
- $30K – $30K
- Top 40% of category vs category
- Royalty
- 5.0%
- Gross Sales · 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 | $1K |
| Transfer fee | $5K |
| Renewal fee | $8K |
| Total fee load | 7.0% of rev |
What do units actually make?
Average unit sales run 12% 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
$160K
15.0% margin
Unlevered ROIC
19%
EBITDA / total invested capital
Payback
5.4 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 Rusty Taco unit return on the cash you put in?
Unlevered ROIC · per unit
Estimated return on your total franchise investment, before any debt financing.
19%
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 Rusty Taco units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$1.7M
on $8.5M purchase
Total debt
$6.8M
SBA $4.3M + 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
- $1.1M
- Per unit, per year
Gross sales are revenue before expenses — not profit. Actual owner earnings depend on rent, labor, royalties, marketing fees, and debt service.
- Item 19 type
- Average Unit Volume
- Sample size
- 24 outlets
- vs category median 20
- Range (low → high)
- $409K→$1.8M
- Cohort dispersion (min → max)
- Reporting year
- 2024
- Fiscal year the figures cover
- Source filing
- FDD 2025
- Disclosed in the 2025 filing, covering 2024
- Transparency
- 4 / 10
- vs category median 4 / 10 · typical
Compared against 782 Quick-Service Restaurants brands
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 $1.1M/year in gross sales. Revenue-to-investment ratio: 1.3x.
Fee burden
Total ongoing fee load of 7.0% (near the Quick-Service Restaurants average).
Disclosure
Transparency score 4/10 — this franchisor discloses detailed breakdowns (quartiles, segments, or cohort data). Buyers can model unit economics with higher confidence.
Operator retention
System expanding at 12.5% CAGR over 3 years across 37 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 Rusty Taco Compares
Is the system healthy?
Source: FDD 2025 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 37
- Opened
- 8
- Last reporting year
- Closed
- 5
- Terminated
- 5
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 13.9%
- Company-owned
- 1
- Corporate units in the system
- % franchised
- 97%
- vs corporate-owned
- Net growth (3-yr)
- +12.5%
- Net unit change over 3 years
- 3-yr CAGR
- +12.5%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 8
- Closed (3yr)
- 3
- Terminated (3yr)
- 5
- Non-renewed (3yr)
- 0
- Transfers (3yr)
- 2
- Reacquired (3yr)
- 0
- Franchisor bought back
- Termination rate
- 2.9%
- Franchisor-initiated terminations
- Ceased ops
- 8.8%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 15 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.
Available to sell in · Item 12
- Hawaii
- Illinois
- Indiana
- Michigan
- Rhode Island
- South Dakota
- Wisconsin
States where the franchisor is registered to sell new franchises (FDD registration filings).
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA loan disclosures. This brand has only 1 7(a) loan on file; statistical reliability is limited below 10 loans.
- Total loans
- 1
- Loan volume
- $949K
- Median loan
- $949K
- 50th percentile
- Charge-off rate
- N/A
- limited sample (1 loan) — rate not shown below 10
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
- N/A
- Loans approved 2021+
- Active lenders
- 1
- Defaults
- N/A
Explore lender portfolios on Bank Reports or regional data on State Reports.
What could kill this investment?
Source: SBA 7(a) FOIA · FDD Items 3, 21
Risk analysis
FranchiseVerdict rating + FDD Items 3, 4, 8, 16, 21
Risk & Legal
Rusty Taco shows financial distress with a large net loss of -$1,038,820 and negative net worth of -$691,370, though no going-concern note was raised and litigation is zero. Growth is positive at 12.5% to 37 units. Stacked concerns: sizable loss plus negative equity, but no auditor doubt.
Litigation (Item 3)
0 case reference(s): 0 pending, 0 settled.
Largest disclosed settlement: $75,000
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Baker Tilly US, LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Must buy proprietary products: No
- Restricted to system-approved products: No
Score breakdown · what drove the 46 / 100 verdict
- 01MINORNet loss -$1,038,820
- 02MINORNegative net worth -$691,370
- 03MINORNo going-concern note, zero litigation, +12.5% growth
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 | 1 |
| Territory type | Radius |
| Protected territory | Yes |
| Online sales rights | Granted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Right of first refusalℹ | Yes |
| Termination notice | 30 days |
| Termination groundsℹ | 1 |
| Curable defaultsℹ | 2 |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Governing law | Delaware |
| Litigation count | 0 |
View Item 3 litigation summary
0 case reference(s): 0 pending, 0 settled.
Items 10, 11
Training & Operations
- Classroom training
- 28 hrs
- On-the-job training
- 172 hrs
- Training location
- On-site and at franchisor location
Items 5 & 11
Franchisor Support
Item 20 · call current owners
Franchisee Contacts
39 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Rusty Taco · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Rusty Taco franchise?
The total investment to open a Rusty Taco franchise ranges from $528K – $1.1M, with an initial franchise fee of $30K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Rusty Taco franchise owners earn?
According to Item 19 of the Rusty Taco FDD, the average gross sales per unit is $1.1M. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Item 19 in the Rusty Taco 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 Rusty Taco FDD and qualifies whose outlets they describe.
What is Rusty Taco's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Rusty Taco (fewer than 10 loans on file). Charge-off rates are one way to gauge franchise risk, but not all franchise loans go through the SBA program. We recommend reviewing turnover and closure data in the FDD and speaking with current franchisees.
How many Rusty Taco franchise locations are there?
As of their most recent FDD filing, Rusty Taco has 37 total units in the United States, including 36 franchised units and 1 company-owned units. 8 new units were opened in the latest reporting year.
Is Rusty Taco a good franchise to buy?
FranchiseVerdict rates Rusty Taco as a C-grade franchise with a verdict score of 46 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?
If you represent Rusty Taco, you can request corrections or provide updated information.
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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.