Bottom line
- Total investment $1.4M – $3.8M including a $35K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $2.8M/year (median $2.7M). Estimated payback in 6.2 years.
- Rated STRONG with a risk score of 41/100.
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 Zaxbys unit return on the cash you put in?
Unlevered ROIC · per unit
16%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Zaxbys units return on equity?
Equity IRR · 5-yr
27.7%
3.39× MOIC
Year-1 DSCR
2.94×
EBITDA ÷ debt service
Equity required
$11.6M
on $23.7M purchase
Total debt
$12.1M
SBA $5.0M + senior + seller note
Overview
About
Franchisees operate fast-casual chicken restaurants featuring Zaxby's signature chicken fingers, salads, and sandwiches. Day-to-day responsibilities include managing a 40–80 person staff, handling food preparation and quality control, managing P&L, marketing locally, maintaining brand standards, and managing drive-thru and dine-in operations during peak service windows.
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 12 · 17 states reported
The Territory Map
FDD Item 12 reports the state count, but the specific list isn't in our current data. The map will appear once we re-extract from the FDD or enough franchisee contacts are available.
17
states with franchisees (per FDD Item 12)
Government records
SBA Loan Data
Aggregated from SBA 7(a) loan disclosures, public data unique to FranchiseVerdict.
No SBA loan data available for this brand.
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Zaxby's presents moderate risk: a mature QSR system with anemic growth, high capital requirements, and undisclosed franchisee financial performance that should be validated extensively with current operators before committing.
Score breakdown · what drove the 41 / 100 rating
- 01MINORSlow unit growth of only 3.8% YoY suggests market saturation or franchisee challenges in a mature 969-unit system
- 02MINORHigh capital requirement ($1.4M–$3.8M) creates significant breakeven risk, especially given modest average net income of $422,652
- 03MEDNo Item 19 (Financial Performance Representations) disclosed limits transparency on actual franchisee profitability and ROI timelines
- 04MINORRoyalty rate of 6% on $2.78M average revenue extracts ~$167k annually, reducing net margins already at 15.2% average
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
100 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Zaxbys · FDD (2025) PDF