Tropical Smoothie Cafe
Bottom line
- Total investment $341K – $815K including a $35K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $1.0M/year (median $955K).
- Rated STRONG with a risk score of 42/100. SBA loan default rate of 0.0% across 287 loans (below the industry average).
- System growing at 26.5% CAGR over 3 years with 1515 total units — strong expansion trajectory.
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 Tropical Smoothie Cafe unit return on the cash you put in?
Unlevered ROIC · per unit
20%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Tropical Smoothie Cafe units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$1.0M
on $5.0M purchase
Total debt
$4.0M
SBA $2.5M + senior + seller note
Overview
About
Tropical Smoothie Cafe franchisees operate quick-service smoothie and café shops, managing daily operations including customer service, inventory management, staff scheduling, and food preparation. Core offerings include custom smoothies, acai bowls, wraps, and salads, with emphasis on health-focused positioning and high-margin beverage sales.
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 · 21 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
Tropical Smoothie Cafe presents CAUTION-level risk due to missing financial disclosure (Item 19), prior litigation over earnings claims, unclear profitability, and moderate unit growth in a competitive segment.
Score breakdown · what drove the 42 / 100 rating
- 01MEDNo Item 19 (Average Unit Volume) disclosed — unable to verify the $1.005M average revenue claim or validate ROI potential
- 02HIGHLitigation history involving fraudulent financial performance misrepresentations regarding a breakfast initiative suggests franchisor made unsubstantiated claims to franchisees
- 03MINORHigh initial investment range ($340K–$814K) with 6% royalty creates significant break-even threshold; profitability unclear without net income disclosure
- 04MINOR10.4% YoY unit growth is modest for QSR segment; slower growth may indicate market saturation or franchisee struggles
- 05MED15-year term with $35K franchise fee and 6% royalty locks franchisees into long-term relationship with limited exit flexibility
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
90 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Tropical Smoothie Cafe · FDD (2025) PDF