Bottom line
- Total investment $503K – $1.0M including a $40K franchise fee, 5.0% ongoing royalty.
- Average unit revenue of $928K/year (median $849K). Estimated payback in 2.5 years.
- Rated STRONG with a risk score of 46/100. SBA loan default rate of 0.0% across 48 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 Shipley Do-Nuts unit return on the cash you put in?
Unlevered ROIC · per unit
10%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Shipley Do-Nuts units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$371K
on $1.9M purchase
Total debt
$1.5M
SBA $0.9M + senior + seller note
Overview
About
Franchisees operate quick-service donut and coffee shops, managing daily production, customer service, inventory, and staffing. The model relies on early morning operations (high donut production volumes) and drive-through/walk-in retail sales, with ancillary beverage and breakfast item sales. Success depends on location quality, operational efficiency, and brand consistency across the 366-unit system.
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 · 13 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
Shipley Do-Nuts presents moderate-to-cautious risk: a mature franchise with slowing growth, active litigation signaling franchisee disputes, undocumented financial claims, and high capital requirements relative to net income reliability.
Score breakdown · what drove the 46 / 100 rating
- 01MINORSlow unit growth of only 5.3% YoY suggests market saturation or system challenges in a mature 366-unit chain
- 02HIGHMultiple active litigation cases including trademark infringement, breach of contract, and landlord disputes indicate franchisor-franchisee relationship tensions and operational control issues
- 03MINORNo Item 19 (Financial Performance Representations) available limits ability to validate the advertised $301,254 average net income across unit types and locations
- 04MEDHigh investment range ($503K-$1M) paired with modest 33% net margin leaves limited buffer for underperformance or economic downturns
- 05MINORTrademark infringement and deceptive trade practice claims suggest brand protection and compliance enforcement challenges
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
99 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Shipley Do-Nuts · FDD (2025) PDF