Wetzel’s PretzelsFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Wetzel’s Pretzels franchise requires a total initial investment of $189K – $725K, including a $40K franchise fee and an ongoing 7.0% royalty[2]. Per the 2026 FDD, average unit revenue was $813K[2]. SBA 7(a) loans show a 4.9% charge-off rate across 87 loans[1]. Verdict grade: A. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2026 FDD issuance
Overview
- Investment
- $189K – $725K
- 28th pct Service Resta…
- Avg gross sales
- $813K
- 26th pct Service Resta…
- Royalty
- 7.0%
- 80th pct Service Resta…
- Units
- 458
- 88th pct Service Resta…
- SBA default
- 4.9%
- 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
Franchising since 1996. Systems this mature have refined operations and brand recognition.
18 legal cases disclosed in the FDD. Read Item 3 before signing.
47% cash-on-cash return (based on P&L Bottom Line). Above the 20% threshold most investors target.
Bottom line
- Total investment $189K – $725K including a $40K franchise fee, 7.0% ongoing royalty.
- Average unit revenue of $813K/year (median $670K), with an estimated 47% cash-on-cash return (based on P&L Bottom Line).
- Verdict A (Top Quintile) with a risk score of 43/100. SBA loan charge-off rate of 4.9% across 87 loans (well below the franchise average, based on all SBA 7(a) franchise lending, 2010–2024).
- Bankruptcy history disclosed in the FDD. Review Item 4 for details before proceeding.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Wetzel’s Pretzels, LLC
- Parent company
- MTY Franchising USA, Inc.
- Incorporated in
- CA
- HQ
- 35 Hugus Alley, Suite 300, Pasadena, California 91103
- Auditor
- PricewaterhouseCoopers LLP
- Audited financials
- Franchisor revenue
- $597.5M
- vs $604.2M prior year
Affiliated brands
- acquired the rights to such franchised brand)
Other brands the franchisor or its parent operates (Item 1).
Overview
About
Wetzel's Pretzels franchisees operate quick-service pretzel shops, typically in high-traffic locations (malls, airports, street-front). Day-to-day operations involve producing hand-rolled pretzels, managing inventory of toppings/dipping sauces, staffing 3-8 employees, handling POS systems, and managing food safety compliance. Most locations are non-traditional (kiosks, carts, co-branded spaces) with minimal seating.
- CEO
- Eric Lefebvre
- Headquarters
- CA
- Founded
- 1995
- FDD year
- 2026
- States available
- 32
FDD Item 7 · 2026 filing · 18 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Feenot refundable | $20K | $40K | |
| Lease Review Feenot refundable | $4K | $7K | |
| Business Premisesnot refundable | $5K | $25K | |
| Leasehold Improvementsnot refundable | $50K | $400K | |
| Food Preparation Equipmentnot refundable | $53K | $99K | |
| Utility Deposits, Licenses, Permits | $1K | $15K | |
| Insurance | $500 | $3K | |
| Signs & Menu Boardsnot refundable | $5K | $20K | |
| Digital Display Boardsnot refundable | $5K | $8K | |
| POS Systemnot refundable | $500 | $1K | |
| Initial Inventory & Smallwaresnot refundable | $8K | $12K | |
| Training Fee for Additional Traineenot refundable | $0 | $750 | |
| Training Expensesnot refundable | $1K | $5K | |
| Grand Opening Advertisingnot refundable | $500 | $5K | |
| Office Equipment & Suppliesnot refundable | $500 | $3K | |
| Professional Feesnot refundable | $1K | $3K | |
| Architect, Engineers & Construction Managernot refundable | $10K | $24K | |
| Additional Funds - first 90 daysnot refundable | $25K | $56K | |
| Total initial investment | $189K | $725K |
Line items extracted from FDD Item 7. Ranges reflect the franchisor's stated low and high per line. Total is the sum of line-item lows / highs — actual costs may fall outside this range depending on market and build-out scope.
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
$114K
14.0% margin
Unlevered ROIC
23%
EBITDA / total invested capital
Payback
4.4 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $189K – $725K
- Better than avg vs category
- Liquid capital req'd
- $25K – $56K
- Near category avg vs category
- Franchise fee
- $20K – $40K
- Below avg, review vs category
- Royalty
- 7.0%
- Adjusted Gross Revenue · typical 6–8%
- Ad fund
- 1.0%
- typical 3–5%
- Total fee load
- 37.5%
- vs 9–13% typical
- Payback period
- 2.1 yrs
- From FDD / Item 19
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 7.0% of gross sales |
| Marketing / ad fund | 1.0% of gross sales |
| Technology fee | $29 |
| Transfer fee | $20K |
| Renewal fee | $50 |
| Total fee load | 37.5% of rev |
At 37.5% total fee load, roughly $305K per year goes to the franchisor before you pay a single operating expense.
Financial Performance
- Avg gross sales
- $813K
- Per unit, per year
- Median gross sales
- $670K
- Avg p&l bottom line
- $213K
- Reported as P&L Bottom Line in FDD Item 19
- Cash-on-cash
- 46.7%
- Based on P&L Bottom Line / investment midpoint
- Item 19 type
- gross_sales
- Sample size
- 295 units
- vs category median 28 · large
- Range (low → high)
- $72K→$2.8M
- Cohort dispersion (min → max)
- Transparency
- 10 / 5
- vs category median 4 / 5 · above
Compared against 453 Quick-Service Restaurants brands
vs Quick-Service Restaurants averages
How Wetzel’s Pretzels Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 458
- Opened
- 48
- Last reporting year
- Closed
- 15
- Turnover rate
- 3.3%
- Company-owned
- 35
- Corporate units in the system
- % franchised
- 92%
- vs corporate-owned
- Net growth (yr3)
- +8.5%
- Net unit change last year
- 3-yr CAGR
- +21.9%
- Compounded over last 3 years
3-year detail · Item 20
- Transfers (3yr)
- 13
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 25 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.
Available to sell in · Item 12
- California
- Hawaii
- Illinois
- Indiana
- New York
States where the franchisor is registered to sell new franchises (FDD registration filings).
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 87
- Loan volume
- $35.0M
- Median loan
- $317K
- 50th percentile
- Charge-off rate
- 4.9%
- 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)
- 95.1%
- 5-yr charge-off
- 0.0%
- Loans approved 2021+
- Active lenders
- 38
- Defaults
- 2
Vintage analysis
Wetzel’s Pretzels charge-off rate by loan vintage
Explore lender portfolios on Bank Reports or regional data on State Reports.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Caution-level investment with meaningful litigation exposure, undisclosed financial performance data, and modest unit growth offsetting the brand's operational profitability and protected territory protections.
Litigation (Item 3)
3 case reference(s): 0 pending, 3 settled.
Largest disclosed settlement: $540,000
Bankruptcy (Item 4)
Disclosed in last 7 years
Bankruptcy Code; (b) obtained a discharge of its debts under the bankruptcy code; or (c) was a principal officer of a company or a general partner in a partnership that either filed as a debtor (or had filed against it) a petition to start an action under the U.S. Bankruptcy Code or that obtained a
Audited financials (Item 21)
Yes · PricewaterhouseCoopers LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Must buy proprietary products: No
- Restricted to system-approved products: No
Score breakdown · what drove the 43 / 100 rating
- 01HIGHMultiple litigation disclosures involving franchisor and affiliates across multiple states (Maryland, NY, Virginia) covering contract breaches, misrepresentations, and regulatory violations—suggests systemic compliance issues
- 02MEDNo Item 19 (Financial Performance Representations) disclosed—prevents validation of the $813,125 average revenue and $190,698 net income claims; franchisees cannot independently verify earnings potential
- 03HIGHUnit growth of only 8.5% YoY is modest for a mature brand; combined with litigation history, suggests market saturation or franchisee dissatisfaction limiting expansion
- 04MEDHigh investment ceiling ($725,450) relative to disclosed net income ($190,698) creates extended ROI timeline (3.8+ years) with elevated financial risk if performance underperforms
- 05HIGHFranchisor's affiliate network (Kahala parent company) involved in multiple litigations across Famous Dave's, Papa Murphy's, and other brands—indicates potential systemic management/governance problems at parent level
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 | radius/location |
| Protected territory | Yes |
| Online sales rights | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Non-compete (years)ℹ | 2 years |
| Right of first refusalℹ | Yes |
| Termination notice | 30 days |
| Curable defaultsℹ | 6 |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Governing law | your State |
| Litigation count | 18 |
View Item 3 litigation summary
3 case reference(s): 0 pending, 3 settled.
Items 10, 11
Training & Operations
- Classroom training
- 40 hrs
- On-the-job training
- 40 hrs
- Training location
- On-site and corporate
- Franchisor financing
- Not offered
- Item 10
Items 5 & 11
Franchisor Support
Item 20 · call current owners
Franchisee Contacts
194 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Wetzel’s Pretzels · FDD (2026) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Wetzel’s Pretzels franchise?
The total investment to open a Wetzel’s Pretzels franchise ranges from $189K – $725K, with an initial franchise fee of $40K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Wetzel’s Pretzels franchise owners earn?
According to Item 19 of the Wetzel’s Pretzels FDD, the average gross sales per unit is $813K. The median is $670K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Wetzel’s Pretzels's franchise failure rate?
Based on SBA 7(a) loan data, Wetzel’s Pretzels has a charge-off rate of 4.9% across 87 loans, meaning 4.9% 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 Wetzel’s Pretzels franchise locations are there?
As of their most recent FDD filing, Wetzel’s Pretzels has 458 total units in the United States, including 347 franchised units and 35 company-owned units. 48 new units were opened in the latest reporting year.
Is Wetzel’s Pretzels a good franchise to buy?
FranchiseVerdict rates Wetzel’s Pretzels as a A-grade franchise with a risk score of 43 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 Wetzel’s Pretzels, you can request corrections or provide updated information.
Claim this brandOther Quick-Service Restaurants franchises
Compare similar franchise opportunities in the Quick-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.