TacoTime Franchise Cost, Revenue & Review 2026
- Investment
- $366K – $824K
- Disclosed sales
- $860K
- gross sales, not profit
- SBA charge-off
- 31.2%
- on 89 loans
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
TacoTime is a quick-service franchise serving Mexican-inspired tacos, burritos, and its signature Mexi-Fries. Franchisees run restaurants with drive-thru and dine-in service, managing food prep and staffing.
FranchiseVerdict summary · 2026
A TacoTime franchise requires a total initial investment of $366K – $824K, including a $30K franchise fee and an ongoing 6.0% royalty[2]. Per the 2025 FDD, average unit revenue was $860K[2]. SBA 7(a) loans show a 31.2% charge-off rate across 89 loans[1]. FranchiseVerdict grade: C (Average), an editorial assessment, not investment advice. Run a live ROI scan →
Sources, dates and evidence
FDD issued: · Data extracted: · Last cited check: · Staleness risk: medium - issued 12 to 24 months ago; a newer filing is likely on file
Evidence: strong✓ Investment (Item 7)✓ Item 19 status✓ Units and owners (Item 20)✓ SBA loan coverage✓ Litigation (Item 3)✓ Financial statements (Item 21)✓ Franchisor identityhow this is scored7 of 7 headline figures on this page cite a page of the filing.
Overview
- Investment
- $366K – $824K
- 59th pct Service Resta…
- Avg gross sales
- $860K
- 15th pct Service Resta…
- Royalty
- 6.0%
- 48th pct Service Resta…
- Units
- 99
- 76th pct Service Resta…
- SBA charge-off
- 31.2%
- % of SBA 7(a) loans not repaid · median varies by category
Quick verdict · Quick-Service Restaurants · color = vs category peers
Green = favorable by >10% vs Quick-Service Restaurants median · 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 $366K – $824K including a $30K franchise fee, 6.0% ongoing royalty.
- RETURNSAverage unit revenue of $860K/year (median $825K).
- RISKVerdict C (Average), verdict score 40/100 (higher is better). SBA loan charge-off rate of 31.2% across 89 loans (well above the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2025).
- GROWTHNegative: net -2 franchised outlets in the latest year (0 opened, 2 closed); 8 signed but not yet open (Item 20).
- LEGAL20 litigation matters disclosed in Item 3, higher than typical. Review the summary for patterns (franchisor-initiated vs. franchisee-initiated).
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- Kahala Franchising, L.L.C.
- Parent company
- Kahala Brands, Inc.
- FDD Item 1, page 7 of the 2025 FDD
- Ultimate parent
- MTY Food Group, Inc.
- FDD Item 1, page 7 of the 2025 FDD
- Predecessor
- Taco Time International, Inc.
- Prior franchisor entity
- CEO title
- Chief Executive Officer of MTY
- Eric Lefebvre
- CEO experience
- 2018 yrs
- Years in role or industry
- Incorporated in
- Arizona
- HQ
- 9311 E. Via De Ventura, Scottsdale, Arizona 85258
- Auditor
- PricewaterhouseCoopers LLP
- Audited financials
- Franchisor revenue
- $597.5M
- vs $606.6M prior year
- Management churn noted
- Frequent turnover
- Item 2 disclosed frequent executive changes
Same owner · FDD Item 1, page 7
26 other brands on this site name MTY Food Group, Inc. as parent or ultimate parent in their own FDD.
- Barrio QueenC
- BlimpieD
- Chicken Strips and DipsD
- Cold Stone CreameryC
- Extreme PitaF
- Famous Dave’sB
- Ginger Sushi + Poke ShopC
- GrabbagreenC
- Great SteakC
- Kahala Coffee TradersB
- La DiperieB
- Manchu WOKB
- Maui WowiD
- Mucho BurritoB
- NrGize Lifestyle CafeB
- Papa Murphy'sA
- PinkberryB
- Planet SmoothieC
- Samurai Sam’s Teriyaki GrillB
- Sauce Pizza / WineD
- Surf City SqueezeD
- Thai ExpressD
- Village InnD
- Wetzel’s PretzelsA
- +2 more
Portfolio: MTY Food Group · Kahala Brands
Grouped by the owner's name as each filing prints it (this page: the 2025 FDD). Spelling variants of the same group may be listed apart; a brand is never grouped with an owner its filing does not name.
Overview
About
- CEO
- Eric Lefebvre
- Headquarters
- AZ
- FDD year
- 2025
- States available
- 10
Can you afford it, and what does the money buy?
Entry cost runs 23% above the typical quick-service restaurants franchise.
Source: FDD 2025 · Items 5–7
FDD Item 7 · 2025 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $30K | $30K |
| Working capital (3–6 mo) | $5K | $20K |
| Equipment, build-out, other | $331K | $774K |
| Total initial investment | $366K | $824K |
Source: TacoTime 2025 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $366K – $824K
- Middle of category vs category
- Liquid capital req'd
- $5K – $20K
- Top 40% of category vs category
- Franchise fee
- $30K – $30K
- Top 40% of category vs category
- Royalty
- 6.0%
- Set by a formula · typical 6–8%
- Ad fund
- 4.0%
- typical 3–5%
- Total fee load
- 10.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 6.0% of gross sales |
| Marketing / ad fund | 4.0% of gross sales |
| Technology fee | $75 |
| Training fee | $2K |
| Transfer fee | $8K |
| Renewal fee | $15K |
| Inventory (initial) | $4K – $10K |
| Total fee load | 10.0% 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 · not modelled
Returns at a glance
An FDD discloses gross sales, not profit, and the operating costs that turn one into the other are in no filing. We publish no modelled return for TacoTime until someone supplies them — yours, in the models below.
—
Not modelled yet
An FDD discloses gross sales, not profit. We hold no sourced figure for COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
Total invested capital · disclosed
$607K
Item 7 initial investment plus working capital, as filed — the one figure here that needs no assumption.
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, read against the 30–60% reference band · Yale SOM, Post-MBA Path Exhibit 2 (2023). Below that band a passive index fund likely outperforms; above it the franchisor has pricing power you're subsidizing.
Note: Item 19 revenue is what the franchisor discloses, and it is the top line only — gross sales are not profit. No FDD discloses the operating costs that turn one into the other, so those fields start empty and nothing is modelled until you supply them from your own lease quote, labor market and build-out budget.
Returns model · single-unit ROIC
What would one TacoTime unit return on the cash you put in?
Illustrative category typicals — not sourced to any filing, survey or sample. Replace them with figures from franchisee validation calls before you rely on the output.
Unlevered ROIC · per unit
Your modelled return on total invested capital, before any debt financing.
—
An FDD discloses gross sales, not profit. We hold no sourced figure for COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
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%.
Not modelled yet
An FDD discloses gross sales, not profit. We hold no sourced figure for COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
A 25-unit return is built on a per-unit EBITDA. Fill in the operating costs in Model A above and this model runs on that figure, or take the whole scenario to the full ROI workbench, where the portfolio and LBO models accept your own per-unit economics directly.
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
- $860K
- Per unit, per year
- Median gross sales
- $825K
Gross sales are revenue before expenses — not profit. Actual owner earnings depend on rent, labor, royalties, marketing fees, and debt service.
- Item 19 type
- gross sales
- Sample size
- 94 outlets
- vs category median 19 · large
- Quartile band
- $442K→$1.6M
- Bottom 25% → top 25%
- 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 781 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 $860K/year in gross sales. Revenue-to-investment ratio: 1.4x.
Fee burden
Total ongoing fee load of 10.0% — above the Quick-Service Restaurants median of 7.5%.
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 contracting at -7.6% CAGR over 3 years. Investigate whether closures are franchisor-driven consolidation or franchisee exits.
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 medians
How TacoTime Compares
Category median of published Quick-Service Restaurants brands that report the figure; the middle half spans the 25th to 75th percentile and n counts the brands behind it. Medians are used because a few very large systems pull an average far from the typical brand. Revenue is disclosed gross sales, not profit.
Is the system healthy?
Source: FDD 2025 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 99
- Opened
- 0
- Last reporting year
- Closed
- 2
- Terminated
- 0
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 1
- Term expired, not renewed (per Item 20)
- Turnover rate
- 2.0%
- Company-owned
- 2
- Corporate units in the system
- % franchised
- 1%
- vs corporate-owned
- Net growth (3-yr)
- -7.6%
- Net unit change over 3 years
- 3-yr CAGR
- -7.6%
- Compounded over last 3 years
Last fiscal year · Item 20 exits and transfers
- Terminated
- 0
- Not renewed
- 1
- Transferred
- 5
- Reacquired
- 1
- Franchisor bought back
- Signed, not yet open
- 8
- 0.08 per open outlet · Item 20 Table 5
- Projected new
- 1
- Franchisor's next-year forecast
- Transfer rate
- 5.1%
- Owners selling to other franchisees
- Termination rate
- 2.0%
- Franchisor-initiated terminations
- Ceased ops
- 1.0%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 12 · 10 states reported
The Territory Map
FDD Item 12 reports the state count, but the specific list isn't in our current data. The map will appear once we re-extract from the FDD or enough franchisee contacts are available.
10
states with franchisees (per FDD Item 12)
Where the owners are · Item 20 owner list
1 current owner across 1 state; 2 former (terminated, transferred or not renewed) listed separately.
- UT 1
Counts only, from the list the franchisor prints in Item 20. Names and phone numbers are for your own due diligence and are not shown here.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 89
- Loan volume
- $27.6M
- Median loan
- $365K
- 50th percentile
- Charge-off rate
- 31.2%
- on 89 loans · rates vary by category · see methodology
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- 68.8%
- 5-yr charge-off
- 0.0%
- Loans approved 2021+
- Active lenders
- 29
- Defaults
- 20
- Typical loan rate
- 8.2%
- avg rate to borrowers
- Franchised industry avg
- 10.8%
- brand above franchise avg ↑
- Jobs supported
- 202
- 5.5 per loan
- Lender concentration
- 44%
- top lender's share
Borrower mix: 33% went to startups / new businesses, 67% to established operators
Franchise vs independent — in limited-service restaurants, franchised businesses charge off at 10.8% vs 10.0% for independents — franchising is associated with 8% higher SBA default risk in this category.
Vintage analysis
TacoTime charge-off rate by loan vintage
Top lenders financing TacoTime franchisees
Showing 3 of 29 lenders. The full breakdown — every lender, state distribution, interest rates & risk ratings — is in the SBA Lending Report below.
Explore lender portfolios on Bank Reports or regional data on State Reports.
Lender network · 7(a) + 504
SBA Lending Report
Full lending analysis for TacoTime from SBA 7(a) FOIA data.
- Principal loss rate
- 0.0%
- Avg SBA guarantee
- 70%
- Avg interest rate
- 8.17%
- Lender concentration
- 44.4%
- Job velocity
- 5.5 per $100K
- NAICS benchmark
- 8.7%
- NAICS 722513
- Jobs supported
- 202
Top SBA lendersTop lender holds 44% of loans
| # | Lender | Loans | Volume | Default % |
|---|---|---|---|---|
| 1 | Columbia Bank | 4 | $1.5M | 0.0% |
| 2 | KeyBank National Association | 2 | $1.1M | 0.0% |
| 3 | America First FCU | 1 | $243K | N/A |
| 4 | Citizens Bank | 1 | $365K | N/A |
| 5 | BMO Bank National Association | 1 | $427K | N/A |
Geographic failure vector
| State | Loans | Defaults | Rate |
|---|---|---|---|
| UTUtah | 4 | 0 | -- |
| IDIdaho | 3 | 0 | 0.0% |
| OROregon | 2 | 0 | -- |
SBA 7(a) lending trend
Borrower profile
Source: SBA 7(a) + 504 FOIA loan-level data, matched by FranchiseVerdict
A 31.2% charge-off rate means roughly 1 in 3 franchisees failed to repay their SBA loan. Investigate what changed.
What could kill this investment?
SBA loans charge off at 31.2% — 95% above the 16.0% national norm, i.e. higher lender-observed risk.
Source: SBA 7(a) FOIA · FDD Items 3, 21
Risk analysis
FranchiseVerdict rating + FDD Items 3, 4, 8, 16, 21
Risk & Legal
Parent-level financials (MTY/Kahala) with strong net worth $252.9M and net income $17.0M; litigation summary is largely concluded historical franchisee disputes across many affiliated brands, not active suits against TacoTime. Audited, Item 19 disclosed (avg gross $860,131). Units down 7.6% in a 99-unit system.
Litigation (Item 3)
Subject: the franchisor is a named party (defendant).
Two concluded litigation matters disclosed: (1) Purav Enterprises, L.L.C., Balwant Bahia, and Paramjit Samra v. The Extreme Pita Franchising USA, Inc., EP Development, Inc., and Feisal Ramjee (Washington Superior Court, Case No. 15-2-15120-7) - franchisees alleged FIPA violations and misrepresentation; settled March 11, 2016 for $20,000; dismissed March 16, 2016. (2) KOHO, Inc. v. Kahala Franchising, L.L.C. (California Superior Court, Los Angeles County, Case No. BC572565) - area representative sued for breach of contract and unjust enrichment; Kahala cross-complained; court granted judgment for Kahala; awarded Kahala $205,000 in attorney's fees; settled June 19, 2017 with Kahala repurchasing territory for $75,000 and forgiving $130,000 in remaining damages.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · PricewaterhouseCoopers LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Guarantor MTY Franchising USA, Inc. consolidated revenue; figures in thousands of USD converted to dollars; FY ends November 30
ⓘ These are the parent company's consolidated financials (the parent guarantees the franchisor), not this brand's standalone results — the figure reflects the whole corporate group, not this brand alone.
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Kickbacks from required suppliers: No
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 40 / 100 verdict
- 01HIGHLitigation is mostly concluded, affiliate-level (parent MTY)
- 02MINORParent-level financials strong: net worth $252.9M
- 03MEDUnit decline -7.6%
- 04MEDItem 19 disclosed, audited
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 10.0% 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 | 5 years |
| Allowed renewalsℹ | 1 |
| Protected territory | No |
| Exclusive territoryℹ | No |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 10 mi |
| Right of first refusalℹ | Yes |
| Transfer requires consent | Yes |
| Termination notice | 90 days |
| Mandatory arbitration | Yes |
| Arbitration location | county and state where the Franchised Business is located |
| Jury trial waiver | Yes |
| Governing law | Arizona |
| Litigation count | 20 |
View Item 3 litigation summary
Two concluded litigation matters disclosed: (1) Purav Enterprises, L.L.C., Balwant Bahia, and Paramjit Samra v. The Extreme Pita Franchising USA, Inc., EP Development, Inc., and Feisal Ramjee (Washington Superior Court, Case No. 15-2-15120-7) - franchisees alleged FIPA violations and misrepresentation; settled March 11, 2016 for $20,000; dismissed March 16, 2016. (2) KOHO, Inc. v. Kahala Franchising, L.L.C. (California Superior Court, Los Angeles County, Case No. BC572565) - area representative sued for breach of contract and unjust enrichment; Kahala cross-complained; court granted judgment for Kahala; awarded Kahala $205,000 in attorney's fees; settled June 19, 2017 with Kahala repurchasing territory for $75,000 and forgiving $130,000 in remaining damages.
Items 10, 11
Training & Operations
- Classroom training
- 40 hrs
- On-the-job training
- 120 hrs
- Training location
- Online. KTEC (Kahala Training & Education Center) in Scottsdale
- Ongoing training
- Optional
- Time to open
- 9 mo
- From signing to launch
- Site selection
- franchisee (with franchisor approval)
- Franchisor financing
- Not offered
- Item 10
Items 5 & 11
Franchisor Support
Item 20 · call current owners
Franchisee Contacts
3 owners to call
Name · phone · city · state. Extracted from FDD Item 20
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a TacoTime franchise?
The total investment to open a TacoTime franchise ranges from $366K – $824K, 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 TacoTime franchise owners earn?
According to Item 19 of the TacoTime FDD, the average gross sales per unit is $860K. The median is $825K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
Who owns TacoTime?
TacoTime is franchised by Kahala Franchising, L.L.C.. Its parent company is Kahala Brands, Inc.. The ultimate parent named in the FDD is MTY Food Group, Inc.. Source: FDD Item 1, 2025 filing.
What is Item 19 in the TacoTime 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 TacoTime FDD and qualifies whose outlets they describe.
What is TacoTime's franchise failure rate?
Based on SBA 7(a) loan data, TacoTime has a charge-off rate of 31.2% across 89 loans, meaning 31.2% of franchise loans were charged off. Charge-off rates are one proxy for franchise risk, though they do not capture all closures. This data comes from FOIA-sourced SBA lending records.
How many TacoTime franchise locations are there?
As of their most recent FDD filing, TacoTime has 99 total units in the United States, including 97 franchised units and 2 company-owned units.
Is TacoTime a good franchise to buy?
FranchiseVerdict rates TacoTime as a C-grade franchise with a verdict score of 40 out of 100 (higher is better). The grade is a deterministic score built from six weighted dimensions — financial health, unit economics, unit growth, scale, legal, and transparency — then calibrated against SBA loan charge-off rates and FDD age. Transparency is one of the six, so a filing that discloses less scores lower on that dimension than one that discloses more. 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
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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.