Smart Drinks
Bottom line
- Total investment $197K – $226K including a $45K franchise fee.
- Average unit revenue of $241K/year (median $240K).
- Rated CAUTION with a risk score of 72/100. SBA loan default rate of 0.0% across 2 loans (below the industry average).
- No protected territory and the franchisor reserves the right to compete in your area. Clarify territorial boundaries before signing.
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 Smart Drinks 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 Smart Drinks units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$96K
on $481K purchase
Total debt
$385K
SBA $0.2M + senior + seller note
Overview
About
Smart Drinks franchisees operate beverage retail locations (likely juice bars, smoothie shops, or functional drink stands) selling branded health-focused beverages. Day-to-day operations involve inventory management, customer service, POS transactions, and product preparation while paying $400 semi-monthly royalties to the franchisor.
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 · 16 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
Smart Drinks presents HIGH RISK due to severe unit contraction (-25% YoY), undisclosed profitability metrics, going concern doubt, and unprotected territories in a collapsing franchise system.
Score breakdown · what drove the 72 / 100 rating
- 01MEDSystem contracting sharply: 25% unit decline year-over-year (7 units remaining) indicates accelerating franchisee exits
- 02MINORNo Item 19 financial disclosure: Average revenue of $240,744 appears healthy but net income completely hidden—likely masking poor profitability
- 03HIGHGoing Concern status: False flag suggests franchisor may have disclosed material uncertainty about business viability to regulators
- 04MINORZero territory protection: Franchisees face cannibalization risk and no defensible market position despite $45,000 franchise fee
- 05MINORWeak ROI visibility: $9,600 annual royalties on ~$240K revenue (4% rate) is reasonable, but without net income data, true payback period is unknowable
- 06MINORTiny, shrinking network: 7 units means minimal brand recognition, supply chain leverage, or peer support—franchise system appears to be failing
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
Smart Drinks · FDD (2025) PDF