The DesigneryFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A The Designery franchise requires a total initial investment of $185K – $420K, including a $55K franchise fee. Per the 2025 FDD, average unit revenue was $1.3M[2]. SBA 7(a) loans show a 0.0% charge-off rate across 11 loans[1]. Verdict grade: A. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2025 FDD issuance
Overview
- Investment
- $185K – $420K
- 44th pct Business Serv…
- Avg gross sales
- $1.3M
- 21st pct Business Serv…
- Royalty
- N/A
- Units
- 73
- 37th pct Business Serv…
- SBA default
- 0.0%
- system-wide median varies by category
Quick verdict · Business Services · color = vs category peers
Green = >15% above Business Services 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
Each dollar invested generates 4.5x in gross revenue, well above the typical 1.5-2.5x range.
Only 0.0% of 11 SBA loans charged off, well below the 16% franchise average.
The system grew 248% year-over-year. Fast growth means demand, but can strain support.
The franchisor's auditor raised doubt about continued operations. This is a serious risk signal.
Bottom line
- Total investment $185K – $420K including a $55K franchise fee.
- Average unit revenue of $1.3M/year, with an estimated 57% cash-on-cash return (based on P&L Bottom Line).
- Verdict A (Top Quintile) with a risk score of 45/100. SBA loan charge-off rate of 0.0% across 11 loans (well below the franchise average, based on all SBA 7(a) franchise lending, 2010–2024).
- Auditor disclosed a going-concern note, which flagged doubt about the franchisor's ability to continue operations. Verify against the latest FDD.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- A1 Kitchen & Bath Franchising, LLC
- Parent company
- HFB Franchisor Holdings, LLC
- Incorporated in
- NC
- HQ
- 107 Parr Drive, Huntersville, North Carolina 28078
- Auditor
- Kezos & Dunlavy
- Audited financials
- Franchisor revenue
- $4.2M
- vs $1.5M prior year
- ⚠ Going-concern note
- Disclosed in FDD 2025
- Auditor flagged doubt about continued operations. Verify against the latest FDD before deciding.
Overview
About
The Designery franchisees operate custom design studios offering personalized design services (likely interior design, graphic design, or similar). Day-to-day operations typically involve client consultations, design project management, material sourcing, and delivery of design solutions within protected territories.
- CEO
- Jeffrey Dudan
- Headquarters
- NC
- Founded
- 2021
- FDD year
- 2025
- States available
- 15
FDD Item 7 · 2025 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $55K | $55K |
| Working capital (3–6 mo) | $20K | $50K |
| Equipment, build-out, other | $111K | $316K |
| Total initial investment | $185K | $420K |
Source: The Designery 2025 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
$202K
15.0% margin
Unlevered ROIC
60%
EBITDA / total invested capital
Payback
20 mo
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $185K – $420K
- Near category avg vs category
- Liquid capital req'd
- $20K – $50K
- Better than avg vs category
- Franchise fee
- $55K – $69K
- Better than avg vs category
- Royalty
- the greater of: (i) a blended 7%-5% of Gross Revenue; or …
- Ad fund
- 2.0%
- typical 3–5%
- Total fee load
- 9.0%
- vs 9–13% typical
- Payback period
- 1.8 yrs
- From FDD / Item 19
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Marketing / ad fund | 2.0% of gross sales |
| Technology fee | $599 |
| Transfer fee | $10K |
| Renewal fee | $5K |
| Total fee load | 9.0% of rev |
Financial Performance
- Avg gross sales
- $1.3M
- Per unit, per year
- Median gross sales
- N/A
- Avg p&l bottom line
- $172K
- Reported as P&L Bottom Line in FDD Item 19
- Cash-on-cash
- 56.9%
- Based on P&L Bottom Line / investment midpoint
- Item 19 type
- Actual (Showroom-based locations)
- Sample size
- 2 units
- vs category median 32 · small
- Range (low → high)
- $922K→$1.8M
- Cohort dispersion (min → max)
- Transparency
- 9 / 5
- vs category median 3 / 5 · above
Compared against 360 Business Services brands
Revenue is 4.5x the investment midpoint. At typical franchise margins, this suggests a payback under 3 years.
vs Business Services averages
How The Designery Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 73
- Opened
- 53
- Last reporting year
- Closed
- 1
- Turnover rate
- 1.4%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (yr3)
- Outlier (see FDD)
- Likely small-sample artifact
3-year detail · Item 20
- Transfers (3yr)
- 1
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 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.
Fast growth in a small system. Newer franchisors expanding quickly may not yet have the support infrastructure of larger systems.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 11
- Loan volume
- $2.8M
- Median loan
- $378K
- 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)
- N/A
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 2
- Defaults
- 0
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into The Designery's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 2 lenders with concentration factor
- Per-state charge-off rates across 5 states
- Startup risk premium and job creation velocity
- 3-year lending trend
Instant access. No subscription.
With a 0.0% charge-off rate across 11 loans, banks have historically viewed this brand favorably for lending.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
The Designery shows concerning litigation, opaque royalty structures, and franchisor financial stress despite rapid unit growth, warranting careful validation of franchisee profitability claims.
Audited financials (Item 21)
Yes · Kezos & Dunlavy⚠ Going-concern note flagged
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Score breakdown · what drove the 45 / 100 rating
- 01HIGHActive litigation involving franchisor vs. franchisee with counterclaims of fraudulent misrepresentation raises governance and disclosure concerns
- 02MINORExplosive unit growth of 247.6% YoY suggests either aggressive expansion or acquisition of struggling units, creating sustainability questions
- 03MINORMinimum Monthly Royalty Fee structure (blended 7%-5%) is opaque; actual royalty burden unclear and could significantly impact the stated $172k average net income
- 04MINORHigh ratio of franchise fee ($54,900) to average net income ($172,359.50) means ROI breakeven could take 4+ months even at optimal performance
- 05HIGHGoing Concern flag indicates potential financial stress at franchisor level despite system growth, raising support and viability questions
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 | 10 years |
|---|---|
| Renewal term | 10 years |
| Allowed renewalsℹ | 1 |
| Territory type | Household count |
| Protected territory | Yes |
| Online sales rights | Restricted |
| 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 |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Governing law | North Carolina |
| Litigation count | 1 |
Items 10, 11
Training & Operations
- Classroom training
- 21 hrs
- On-the-job training
- 20 hrs
- POS system
- Service Minder
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Service Minder
Item 20 · call current owners
Franchisee Contacts
19 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
The Designery · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a The Designery franchise?
The total investment to open a The Designery franchise ranges from $185K – $420K, with an initial franchise fee of $55K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do The Designery franchise owners earn?
According to Item 19 of the The Designery FDD, the average gross sales per unit is $1.3M. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is The Designery's franchise failure rate?
Based on SBA 7(a) loan data, The Designery has a charge-off rate of 0.0% across 11 loans, meaning 0.0% 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 The Designery franchise locations are there?
As of their most recent FDD filing, The Designery has 73 total units in the United States, including 4 franchised units and 0 company-owned units. 53 new units were opened in the latest reporting year.
Is The Designery a good franchise to buy?
FranchiseVerdict rates The Designery as a A-grade franchise with a risk score of 45 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.