Verlo Mattress Franchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
Verlo Mattress is a mattress retail franchise that builds and sells custom mattresses in its own factory-direct stores. Franchisees run the stores, managing assembly, retail sales, and customer service.
FranchiseVerdict summary · 2026
A Verlo Mattress franchise requires a total initial investment of $299K – $751K, including a $50K franchise fee and an ongoing 5.0% royalty[2]. Per the 2024 FDD, average unit revenue was $1.3M[2]. SBA 7(a) loans show a 0.0% charge-off rate across 11 loans[1]. FranchiseVerdict grade: B (Above average), an editorial assessment, not investment advice. Run a live ROI scan →
Data last verified · figures per the 2024 FDD issuance
Overview
- Investment
- $299K – $751K
- 35th pct Retail
- Avg gross sales
- $1.3M
- Outlet subsetNet sales14th pct Retail
- Royalty
- 5.0%
- 6th pct Retail
- Units
- 39
- 17th pct Retail
- SBA charge-off
- 0.0%
- % of SBA 7(a) loans not repaid · median varies by category
Quick verdict · Retail · color = vs category peers
Green = favorable by >10% vs Retail avg · 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 $299K – $751K including a $50K franchise fee, 5.0% ongoing royalty.
- RETURNSAverage unit revenue of $1.3M/year (median $996K) (reported for a subset of outlets rather than the whole system).
- RISKVerdict B (Above average), verdict score 54/100 (higher is better). SBA loan charge-off rate of 0.0% across 11 loans (well below the franchise average, based on all SBA 7(a) franchise lending, 2010–2025).
- GROWTHSystem growing at 17.9% CAGR over 3 years with 39 total units. Strong expansion trajectory.
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- FWR, LLC d/b/a Verlo Mattress
- Parent company
- FWR Holdings, LLC
- Predecessor
- Verlo Mattress Company; Verlo Mattress Company, Inc.; Verlo Mattress Factory Stores, LLC
- Prior franchisor entity
- CEO title
- President
- David Marcus
- Incorporated in
- Wisconsin
- HQ
- 301 N. Broadway Street, Suite 300, Milwaukee, Wisconsin 53202
- Auditor
- CliftonLarsonAllen LLP
- Audited financials
- Franchisor revenue
- $3.1M
- vs $2.5M prior year
Overview
About
- CEO
- David Marcus
- Headquarters
- Wisconsin
- FDD year
- 2024
- States available
- 7
Can you afford it, and what does the money buy?
Entry cost runs 27% above the typical retail franchise.
Source: FDD 2024 · Items 5–7
FDD Item 7 · 2024 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $50K | $50K |
| Working capital (3–6 mo) | $18K | $96K |
| Equipment, build-out, other | $231K | $605K |
| Total initial investment | $299K | $751K |
Source: Verlo Mattress 2024 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
- $299K – $751K
- Top 40% of category vs category
- Liquid capital req'd
- $18K – $96K
- Top 40% of category vs category
- Franchise fee
- $50K – $50K
- Top 40% of category vs category
- Royalty
- 5.0%
- percentage · typical 6–8%
- Ad fund
- 2.5%
- typical 3–5%
- Total fee load
- 7.5%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 5.0% of gross sales |
| Marketing / ad fund | 2.5% of gross sales |
| Technology fee | $500 |
| Training fee | $6K |
| Transfer fee | $10K |
| Renewal fee | $5K |
| Inventory (initial) | $89K – $102K |
| Total fee load | 7.5% of rev |
What do units actually make?
Average unit sales run 39% above the retail norm.
Reported for a subset of outlets rather than the whole system
Reported as net sales, not gross sales
Source: FDD 2024 · Item 19
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
$100K
7.5% margin
Unlevered ROIC
17%
EBITDA / total invested capital
Payback
5.8 yrs
cash-on-cash, unlevered
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. The target band for an attractive franchise is 30–60% ROIC. Below that and a passive index fund likely outperforms; above that and the franchisor has pricing power you're subsidizing.
Note: Item 19 revenue is what the franchisor discloses. It's the top line only. Operating costs below are category estimates. Override them to match your real lease quote, labor market, and build-out budget.
Returns model · single-unit ROIC
What would one Verlo Mattress unit return on the cash you put in?
Unlevered ROIC · per unit
Estimated return on your total franchise investment, before any debt financing.
17%
Below the 30–60% attractive-franchise band
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%.
Levered LBO scenario · Yale Crease Capital framing
What would 25 Verlo Mattress units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$134K
on $670K purchase
Total debt
$536K
SBA $0.3M + senior + seller note
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: 2024 FDD
Financial Performance
Reported for a subset of outlets rather than the whole system
Reported as net sales, not gross sales
- Avg gross sales
- $1.3M
- Per unit, per year
- Median gross sales
- $996K
Gross sales are revenue before expenses — not profit. Actual owner earnings depend on rent, labor, royalties, marketing fees, and debt service.
- Item 19 type
- net sales
- Sample size
- 14 franchisees
- vs category median 47 · small
- Range (low → high)
- $188K→$3.1M
- Cohort dispersion (min → max)
- Reporting year
- 2023
- Fiscal year the figures cover
- Source filing
- FDD 2024
- Disclosed in the 2024 filing, covering 2023
- Transparency
- 7 / 10
- vs category median 3 / 10 · above
Compared against 278 Retail 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 $1.3M/year in gross sales. Median is $996K — top performers pull the average up, so a typical unit earns less. Revenue-to-investment ratio: 2.6x. Reported for a subset of outlets rather than the whole system.
Fee burden
Total ongoing fee load of 7.5% — below the Retail average of 8.9%.
Disclosure
Transparency score 7/10 — this franchisor discloses detailed breakdowns (quartiles, segments, or cohort data). Buyers can model unit economics with higher confidence.
Operator retention
System expanding at 17.9% CAGR over 3 years across 39 units — operators are staying and new ones are joining.
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 Retail averages
How Verlo Mattress Compares
Is the system healthy?
Source: FDD 2024 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 39
- Opened
- 5
- 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
- 6
- Corporate units in the system
- % franchised
- 85%
- vs corporate-owned
- Net growth (3-yr)
- +17.9%
- Net unit change over 3 years
- 3-yr CAGR
- +17.9%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 5
- Closed (3yr)
- 0
- Terminated (3yr)
- 0
- Non-renewed (3yr)
- 0
- Transfers (3yr)
- 2
- Reacquired (3yr)
- 0
- Franchisor bought back
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 6 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.
- Total loans
- 11
- Loan volume
- $6.1M
- Median loan
- $603K
- 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
- 0.0%
- Loans approved 2021+
- Active lenders
- 6
- Defaults
- 0
- Typical loan rate
- 10.6%
- avg rate to borrowers
- vs industry
- 0.0%
- brand is above its industry ↑
- Jobs supported
- 62
- 1.0 per loan
- Lender concentration
- 45%
- top lender's share
Borrower mix: 82% went to startups / new businesses, 18% to established operators
Top lenders financing Verlo Mattress franchisees
Showing 3 of 6 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.
Premium insight
SBA Lending Report
Deep-dive into Verlo Mattress's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 6 lenders with concentration factor
- Per-state charge-off rates across 6 states
- Startup risk premium and job creation velocity
- 4-year lending trend
- SBA 504 real estate/equipment data
Instant access. No subscription.
With a 0.0% charge-off rate across 11 loans, banks have historically viewed this brand favorably for lending.
What could kill this investment?
SBA loans charge off at 0.0% — 100% below the 16.0% national norm, i.e. lower 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
Litigation (Item 3)
Four disclosed cases as of Item 3: (1) MKD Investment Holdings, LLC v. FWR, LLC (AAA arbitration, filed Dec. 2024) alleging misrepresentation in the FDD, seeking rescission and $2M damages; Verlo counterclaimed; (2) The Marcus Corporation, et al. v. MKD Investment Holdings, LLC (E.D. Wis. declaratory judgment action re: arbitrability, filed Aug. 2025), with MKD counterclaiming; (3) North Shore Z's LLC v. FWR, LLC (AAA arbitration, filed May 2025) alleging misrepresentation, seeking rescission and $700,000 damages, with Verlo counterclaiming; final hearing scheduled Sept. 2026; (4) NN3 BP Associates, LLC v. Noble Ventures 317, LLC, et al. (Indiana state court, landlord breach-of-lease action) in which the franchisee cross-claimed against Verlo alleging FDD misrepresentation; Verlo's motion to compel arbitration was granted.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · CliftonLarsonAllen LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: Yes
- Kickbacks from required suppliers: Yes
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
Score breakdown · what drove the 54 / 100 verdict
- 01MINORThin net worth $108,359
- 02MINORFinancial distress flag
- 03MINORNo litigation or bankruptcy
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 7.5% of sales (royalty + ad fund), before rent and labor.
Source: FDD 2024 · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 10 years |
| Territory type | protected |
| Protected territory | Yes |
| Exclusive territoryℹ | No |
| Territory radius | 4 mi |
| 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 | 100 mi |
| Right of first refusalℹ | Yes |
| Transfer requires consent | Yes |
| Termination notice | 90 days |
| Curable defaultsℹ | 3 |
| Mandatory arbitration | Yes |
| Arbitration location | Madison, Wisconsin |
| Jury trial waiver | Yes |
| Governing law | Wisconsin |
| Litigation count | 4 |
View Item 3 litigation summary
Four disclosed cases as of Item 3: (1) MKD Investment Holdings, LLC v. FWR, LLC (AAA arbitration, filed Dec. 2024) alleging misrepresentation in the FDD, seeking rescission and $2M damages; Verlo counterclaimed; (2) The Marcus Corporation, et al. v. MKD Investment Holdings, LLC (E.D. Wis. declaratory judgment action re: arbitrability, filed Aug. 2025), with MKD counterclaiming; (3) North Shore Z's LLC v. FWR, LLC (AAA arbitration, filed May 2025) alleging misrepresentation, seeking rescission and $700,000 damages, with Verlo counterclaiming; final hearing scheduled Sept. 2026; (4) NN3 BP Associates, LLC v. Noble Ventures 317, LLC, et al. (Indiana state court, landlord breach-of-lease action) in which the franchisee cross-claimed against Verlo alleging FDD misrepresentation; Verlo's motion to compel arbitration was granted.
Items 10, 11
Training & Operations
- Classroom training
- 112 hrs
- On-the-job training
- 28 hrs
- Training location
- Greenfield, Wisconsin (or another site/platform as designated; may be in-person or remote)
- Ongoing training
- Required
- Time to open
- 12 mo
- From signing to launch
- Franchisor financing
- Not offered
- Item 10
Items 5 & 11
Franchisor Support
Item 20 · call current owners
Franchisee Contacts
26 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Verlo Mattress · FDD (2024) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Verlo Mattress franchise?
The total investment to open a Verlo Mattress franchise ranges from $299K – $751K, with an initial franchise fee of $50K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Verlo Mattress franchise owners earn?
According to Item 19 of the Verlo Mattress FDD, the average gross sales per unit is $1.3M. The median is $996K. Important context: Reported for a subset of outlets rather than the whole system. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Item 19 in the Verlo Mattress 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 Verlo Mattress FDD and qualifies whose outlets they describe.
What is Verlo Mattress's franchise failure rate?
Based on SBA 7(a) loan data, Verlo Mattress 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 Verlo Mattress franchise locations are there?
As of their most recent FDD filing, Verlo Mattress has 39 total units in the United States, including 33 franchised units and 6 company-owned units. 5 new units were opened in the latest reporting year.
Is Verlo Mattress a good franchise to buy?
FranchiseVerdict rates Verlo Mattress as a B-grade franchise with a verdict score of 54 out of 100 (higher is better), 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.