Tapioca ExpressFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Tapioca Express franchise requires a total initial investment of $138K – $479K, including a $15K franchise fee. Per the 2024 FDD, average unit revenue was $677K[2]. Verdict grade: F. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2024 FDD issuance
Overview
- Investment
- $138K – $479K
- 15th pct Service Resta…
- Avg gross sales
- $677K
- 19th pct Service Resta…
- Royalty
- N/A
- Units
- 19
- 46th pct Service Resta…
- SBA default
- 0.0%
- system-wide median varies by category
Quick verdict · Quick-Service Restaurants · color = vs category peers
Green = >15% above Quick-Service Restaurants avg · No shading = within ±15% · Red = >15% below avg · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
The system contracted 26% year-over-year. Investigate why units are closing.
Bottom line
- Total investment $138K – $479K including a $15K franchise fee.
- Average unit revenue of $677K/year.
- Verdict F (Bottom Quintile) with a risk score of 82/100.
- 3 units terminated last reporting year (15.8% of the system). Ask existing franchisees why.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Tapioca Express, Inc.
- CEO title
- Chief Executive Officer
- Cheng Wei Lin
- Founder active
- Yes
- Original founder still leading the business
- Incorporated in
- CA
- HQ
- 1908 Central Avenue, South El Monte, California 91733
- Auditor
- Yeh & Associates
- Audited financials
- Franchisor revenue
- $1.9M
- vs $1.7M prior year
- Management churn noted
- Frequent turnover
- Item 2 disclosed frequent executive changes
Overview
About
Franchisees operate quick-service bubble tea and tapioca beverage shops, managing POS systems, inventory, staff scheduling, and customer service in a retail location. Day-to-day operations include beverage preparation, quality control, local marketing, and managing labor costs within a protected territory.
- CEO
- Cheng Wei Lin
- Headquarters
- CA
- Founded
- 1999
- FDD year
- 2024
- States available
- 3
FDD Item 7 · 2024 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $15K | $15K |
| Working capital (3–6 mo) | $18K | $30K |
| Equipment, build-out, other | $105K | $434K |
| Total initial investment | $138K | $479K |
Source: Tapioca Express 2024 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
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
$105K
15.5% margin
Unlevered ROIC
32%
EBITDA / total invested capital
Payback
3.2 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $138K – $479K
- Better than avg vs category
- Liquid capital req'd
- $18K – $30K
- Near category avg vs category
- Franchise fee
- $9K – $15K
- Better than avg vs category
- Royalty
- the greater of 2.5% of Gross Sales or $500 per month
- Ad fund
- 0.5%
- typical 3–5%
- Total fee load
- 3.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty (flat) | greater of 2.5% or $500/month, can increase to maximum 6% or $1200/month |
| Marketing / ad fund | 0.5% of gross sales |
| Technology fee | $500 |
| Training fee | $3K |
| Transfer fee | $4K |
| Renewal fee | $3K |
| Total fee load | 3.0% of rev |
A 3.0% total fee load is unusually lean. More of each revenue dollar stays with the franchisee.
Financial Performance
- Avg gross sales
- $677K
- Per unit, per year
- Median gross sales
- N/A
- Item 19 type
- gross_sales
- Sample size
- 17 units
- vs category median 28
- Range (low → high)
- $60K→$3.2M
- Cohort dispersion (min → max)
- Quartile band
- $277K→$1.1M
- Bottom 25% → top 25%
- Reporting year
- 2024
- Fiscal year the figures cover
- Transparency
- 3 / 5
- vs category median 4 / 5 · below
Compared against 453 Quick-Service Restaurants brands
vs Quick-Service Restaurants averages
How Tapioca Express Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 19
- Opened
- 0
- Last reporting year
- Closed
- 3
- Terminated
- 3
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 15.8%
- Company-owned
- 2
- Corporate units in the system
- % franchised
- 90%
- vs corporate-owned
- Net growth (yr3)
- -26.1%
- Net unit change last year
- 3-yr CAGR
- -29.2%
- Compounded over last 3 years
3-year detail · Item 20
- Transfers (3yr)
- 0
- Projected new
- 4
- Franchisor's next-year forecast
- Termination rate
- 15.8%
- Franchisor-initiated terminations
- Ceased ops
- 31.6%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 3 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.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA loan disclosures. This brand has only 3 7(a) loans on file; statistical reliability is limited below 10 loans.
- Total loans
- 3
- Loan volume
- $799K
- Median loan
- $184K
- 50th percentile
- Charge-off rate
- 0.0%
- 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)
- 100.0%
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 1
- Defaults
- 0
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Tapioca Express's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 1 lenders with concentration factor
- Per-state charge-off rates across 1 states
- Startup risk premium and job creation velocity
- 1-year lending trend
- SBA 504 real estate/equipment data
Instant access. No subscription.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Tapioca Express presents high risk due to significant unit decline, missing financial disclosures, and franchisor going concern status, making ROI validation impossible and suggesting systemic operational or financial problems.
Litigation (Item 3)
No litigation information is required to be disclosed
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Yeh & Associates
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: Yes
- 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 82 / 100 rating
- 01MINORUnit count declining 26.1% year-over-year (19 units) indicates system contraction and potential franchisee dissatisfaction
- 02MEDNet income not disclosed in Item 19 prevents ROI validation and suggests franchisor may be hiding unfavorable unit economics
- 03HIGHGoing Concern status is FALSE, indicating potential financial instability or legal/operational issues at franchisor level
- 04MEDHigh investment range ($137.5K–$479.1K) with undisclosed profitability creates significant downside risk
- 05MINORRoyalty structure's $500/month floor may be burdensome for underperforming locations, especially given average revenue of $676K
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 5 years |
|---|---|
| Renewal term | 5 years |
| Allowed renewalsℹ | 1 |
| Territory type | Radius |
| Protected territory | Yes |
| Exclusive territoryℹ | Yes |
| Territory radius | 0.5 mi |
| Online sales rights | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 10 mi |
| Right of first refusalℹ | Yes |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Arbitration location | Los Angeles County, California |
| Jury trial waiver | Yes |
| Governing law | California |
| Litigation count | 0 |
View Item 3 litigation summary
No litigation information is required to be disclosed
Items 10, 11
Training & Operations
- Classroom training
- 12 hrs
- On-the-job training
- 88 hrs
- Training location
- El Monte, California and Alhambra, California
- POS system
- Clover and Snackpass
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Clover and Snackpass
Item 20 · call current owners
Franchisee Contacts
23 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Tapioca Express · FDD (2024) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Tapioca Express franchise?
The total investment to open a Tapioca Express franchise ranges from $138K – $479K, with an initial franchise fee of $15K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Tapioca Express franchise owners earn?
According to Item 19 of the Tapioca Express FDD, the average gross sales per unit is $677K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Tapioca Express's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Tapioca Express (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 Tapioca Express franchise locations are there?
As of their most recent FDD filing, Tapioca Express has 19 total units in the United States, including 17 franchised units and 2 company-owned units.
Is Tapioca Express a good franchise to buy?
FranchiseVerdict rates Tapioca Express as a F-grade franchise with a risk score of 82 out of 100, 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.
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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.