The Yellow ChilliFranchise Cost, Revenue & Review 2026
Data from FDD filing
FranchiseVerdict summary · 2026
A The Yellow Chilli franchise requires a total initial investment of $238K – $977K, including a $75K franchise fee and an ongoing 6.0% royalty[2]. The 2025 FDD does not disclose unit-level revenue (no Item 19). Verdict grade: C. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2025 FDD issuance
Overview
- Investment
- $238K – $977K
- 13th pct Service Resta…
- Avg gross sales
- N/A
- 28th pct Service Resta…
- Royalty
- 6.0%
- 26th pct Service Resta…
- Units
- 5
- 13th pct Service Resta…
- SBA default
- N/A
Quick verdict · Full-Service Restaurants · color = vs category peers
Green = >15% above Full-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
Franchising since 2001. Systems this mature have refined operations and brand recognition.
The franchisor's auditor raised doubt about continued operations. This is a serious risk signal.
Bottom line
- Total investment $238K – $977K including a $75K franchise fee, 6.0% ongoing royalty.
- No Item 19 financial performance data disclosed. The franchisor chose not to publish revenue figures.
- Verdict C (Average) with a risk score of 67/100.
- 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
- SK Restaurants Pvt. Ltd.
- CEO title
- Founder and Chairman
- Sanjeev Kapoor
- Founder active
- Yes
- Original founder still leading the business
- Incorporated in
- India
- HQ
- C-18 Dalia Estate, Near Fun Republic, Andheri Link Road, Andheri (W), Mumbai, India 400053
- Auditor
- Stalwart CPA Services LLC
- Audited financials
- Franchisor revenue
- $320K
- vs $387K 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 Yellow Chilli is an Indian casual dining franchise where franchisees operate restaurant locations serving Indian cuisine. Day-to-day operations involve managing kitchen staff, sourcing ingredients, managing front-of-house service, maintaining consistency with brand standards, and handling P&L while paying 6-7.5% royalties to the franchisor.
- CEO
- Sanjeev Kapoor
- FDD year
- 2025
- States available
- 3
FDD Item 7 · 2025 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $75K | $75K |
| Working capital (3–6 mo) | $75K | $100K |
| Equipment, build-out, other | $88K | $802K |
| Total initial investment | $238K | $977K |
Source: The Yellow Chilli 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
- $238K – $977K
- Better than avg vs category
- Liquid capital req'd
- $75K – $100K
- Near category avg vs category
- Franchise fee
- $75K – $75K
- Near category avg vs category
- Royalty
- 6.0%
- Gross Sales · typical 6–8%
- Ad fund
- 1.0%
- typical 3–5%
- Total fee load
- 7.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 6.0% of gross sales |
| Marketing / ad fund | 1.0% of gross sales |
| Technology fee | $300 |
| Training fee | $12K |
| Transfer fee | $38K |
| Renewal fee | $38K |
| Total fee load | 7.0% of rev |
Financial Performance
This franchisor did not disclose financial performance representations in Item 19, or our extractor could not parse them.
vs Full-Service Restaurants averages
How The Yellow Chilli Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 5
- Opened
- 0
- Last reporting year
- Closed
- 0
- Terminated
- 0
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 0.0%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (yr3)
- +0.0%
- Net unit change last year
- 3-yr CAGR
- +0.0%
- Compounded over last 3 years
3-year detail · Item 20
- Transfers (3yr)
- 0
- Continuity rate
- 100.0%
- Units that stayed open
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 7 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 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
No SBA loan data available for this brand.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Micro-brand with litigation history, regulatory penalties, zero financial transparency, unprotected territory, and stagnant unit growth presents high abandonment and profitability risk.
Litigation (Item 3)
Mormukut Inn Pvt. Ltd. (Franchisee) v. S.K. Restaurants Pvt. Ltd. (Franchisor): Three cases filed in 2015-2016 (Arbitration Case No. 400/2015 at District Court Agra; Arbitration Case No. 99/2015 at High Court Allahabad; Case No. 1101/2016 at Court of CJM Agra) alleging unfair acts in franchise offer/sale. Settled November 14, 2016 with franchise termination, withdrawal of all cases, and Rs. 1,00,00,000 payment to Franchisee. California Department of Business Oversight administrative action (Consent Order ID: 213620, May 7, 2020): Franchisor offered franchises in California via 'Letter of Intent' and 'Interim Franchise Agreement' documents (Feb 2016-Jan 2018) to three entities without proper franchise registration or FDD disclosure in violation of California Corporations Code sections 31110 and 31119. Resolved via Consent Order with $15,000 penalty and requirement to serve updated FDD and rescission offer to affected franchisees; all three declined rescission.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Stalwart CPA Services LLC⚠ Going-concern note flagged
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 67 / 100 rating
- 01MINOROnly 5 operating units with unknown growth trajectory suggests stagnant or declining system
- 02HIGHLitigation history: Rs. 1 crore (~$120k) settlement for unfair franchise sales practices plus California regulatory penalty indicates systemic compliance issues
- 03MEDNo financial disclosure (average revenue/net income) prevents ROI validation; franchise fee of $75k with 6-7.5% royalties on undisclosed sales creates opacity
- 04MINORUnprotected territory exposes franchisees to brand cannibalization and direct competition from other franchisees
- 05MINORHigh investment range ($238k-$977k) with minimal unit count suggests poor unit economics or high capital requirements without proven returns
- 06HIGH10-year term locks franchisees into relationship with franchisor with litigation history
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 |
| Protected territory | No |
| Exclusive territoryℹ | No |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 20 mi |
| Right of first refusalℹ | Yes |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Arbitration location | Mumbai, India |
| Jury trial waiver | Yes |
| Governing law | Republic of India |
| Litigation count | 2 |
View Item 3 litigation summary
Mormukut Inn Pvt. Ltd. (Franchisee) v. S.K. Restaurants Pvt. Ltd. (Franchisor): Three cases filed in 2015-2016 (Arbitration Case No. 400/2015 at District Court Agra; Arbitration Case No. 99/2015 at High Court Allahabad; Case No. 1101/2016 at Court of CJM Agra) alleging unfair acts in franchise offer/sale. Settled November 14, 2016 with franchise termination, withdrawal of all cases, and Rs. 1,00,00,000 payment to Franchisee. California Department of Business Oversight administrative action (Consent Order ID: 213620, May 7, 2020): Franchisor offered franchises in California via 'Letter of Intent' and 'Interim Franchise Agreement' documents (Feb 2016-Jan 2018) to three entities without proper franchise registration or FDD disclosure in violation of California Corporations Code sections 31110 and 31119. Resolved via Consent Order with $15,000 penalty and requirement to serve updated FDD and rescission offer to affected franchisees; all three declined rescission.
Items 10, 11
Training & Operations
- Classroom training
- 24 hrs
- On-the-job training
- 96 hrs
- Training location
- At your restaurant and/or virtual
- Ongoing training
- Required
- Field support
- 96 hrs/yr
- On-site visits per year
- POS system
- approved POS system
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: approved POS system
Item 20 · call current owners
Franchisee Contacts
10 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
The Yellow Chilli · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a The Yellow Chilli franchise?
The total investment to open a The Yellow Chilli franchise ranges from $238K – $977K, with an initial franchise fee of $75K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do The Yellow Chilli franchise owners earn?
The Yellow Chilli does not disclose average franchise owner earnings in their FDD Item 19. Not all franchisors are required to make financial performance representations. We recommend asking existing franchisees directly about their financial experience.
What is The Yellow Chilli's franchise failure rate?
SBA 7(a) loan charge-off data is not available for The Yellow Chilli (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 The Yellow Chilli franchise locations are there?
As of their most recent FDD filing, The Yellow Chilli has 5 total units in the United States, including 5 franchised units and 0 company-owned units.
Is The Yellow Chilli a good franchise to buy?
FranchiseVerdict rates The Yellow Chilli as a C-grade franchise with a risk score of 67 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.
For franchisors
Are you the franchisor?
If you represent The Yellow Chilli, you can request corrections or provide updated information.
Claim this brandOther Full-Service Restaurants franchises
Compare similar franchise opportunities in the Full-Service Restaurants category
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.