ZIPS CleanersFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A ZIPS Cleaners franchise requires a total initial investment of $762K – $1.2M, including a $30K franchise fee and an ongoing 6.0% royalty[2]. Per the 2025 FDD, average unit revenue was $1.5M[2]. SBA 7(a) loans show a 100.0% charge-off rate across 15 loans[1]. Verdict grade: D. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2025 FDD issuance
Overview
- Investment
- $762K – $1.2M
- 81st pct Cleaning & Ma…
- Avg gross sales
- $1.5M
- 45th pct Cleaning & Ma…
- Royalty
- 6.0%
- 10th pct Cleaning & Ma…
- Units
- 72
- 55th pct Cleaning & Ma…
- SBA default
- 100.0%
- system-wide median varies by category
Quick verdict · Cleaning & Maintenance · color = vs category peers
Green = >15% above Cleaning & Maintenance 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
100.0% of SBA loans charged off across 15 loans, above the 16% franchise average.
Franchised units fell from 70 to 63 over 3 years. Investigate why operators are leaving.
38% cash-on-cash return (based on Gross Margin). Above the 20% threshold most investors target.
Bottom line
- Total investment $762K – $1.2M including a $30K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $1.5M/year, with an estimated 38% cash-on-cash return (based on Gross Margin). Note: this is gross profit, not take-home income.
- Verdict D (Below Average) with a risk score of 75/100. SBA loan charge-off rate of 100.0% across 15 loans (well above the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2024).
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- ZIPS FRANCHISING, LLC
- Parent company
- Value Drycleaners of America, LLC
- Ultimate parent
- JPBVDA, Inc.
- CEO title
- Chief Executive Officer
- Robert J. Barry, Jr.
- Incorporated in
- MD
- HQ
- 8510 Corridor Road, Suite 200, Savage, Maryland 20763
- Auditor
- SC&H Attest Services, P.C.
- Audited financials
- Franchisor revenue
- $5.4M
- vs $5.7M prior year
- Management churn noted
- Frequent turnover
- Item 2 disclosed frequent executive changes
Overview
About
ZIPS Cleaners franchisees operate express dry cleaning and laundry facilities, typically in high-traffic retail locations. Daily operations include garment intake, processing through on-site equipment or partnerships, customer service, inventory management, and fulfillment of cleaning orders. The model emphasizes speed and competitive pricing rather than full-service traditional dry cleaning.
- CEO
- Robert J. Barry, Jr.
- Headquarters
- MD
- Founded
- 2004
- FDD year
- 2025
- States available
- 9
FDD Item 7 · 2025 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $30K | $30K |
| Working capital (3–6 mo) | $100K | $200K |
| Equipment, build-out, other | $632K | $968K |
| Total initial investment | $762K | $1.2M |
Source: ZIPS Cleaners 2025 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
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
$167K
11.0% margin
Unlevered ROIC
15%
EBITDA / total invested capital
Payback
6.7 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $762K – $1.2M
- Below avg, review vs category
- Liquid capital req'd
- $100K – $200K
- Below avg, review vs category
- Franchise fee
- $15K – $30K
- Better than avg vs category
- Royalty
- 6.0%
- Royalty Net Sales · typical 6–8%
- Ad fund
- 2.0%
- typical 3–5%
- Total fee load
- 8.0%
- vs 9–13% typical
- Payback period
- 2.7 yrs
- From FDD / Item 19
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 6.0% of gross sales |
| Marketing / ad fund | 2.0% of gross sales |
| Technology fee | $550 |
| Training fee | $500 |
| Transfer fee | $10K |
| Renewal fee | $10K |
| Total fee load | 8.0% of rev |
Financial Performance
- Avg gross sales
- $1.5M
- Per unit, per year
- Median gross sales
- N/A
- Avg gross margin
- $368K
- Reported as Gross Margin in FDD Item 19
- Cash-on-cash
- 37.6%
- Based on Gross Margin / investment midpoint
- Item 19 type
- Average Total Income, Cost of Goods, Gross Profit, and Certain Costs
- Sample size
- 49 units
- vs category median 31
- Range (low → high)
- $220K→$2.8M
- Cohort dispersion (min → max)
- Transparency
- 10 / 5
- vs category median 4 / 5 · above
Compared against 204 Cleaning & Maintenance brands
vs Cleaning & Maintenance averages
How ZIPS Cleaners Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 72
- Opened
- 4
- 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
- 2
- Corporate units in the system
- % franchised
- 97%
- vs corporate-owned
- Multi-unit owners
- 33.3%
- Net growth (yr3)
- +6.1%
- Net unit change last year
- 3-yr CAGR
- +11.1%
- Compounded over last 3 years
3-year detail · Item 20
- Transfers (3yr)
- 1
- Projected new
- 5
- Franchisor's next-year forecast
- Transfer rate
- 1.4%
- Owners selling to other franchisees
- Ceased ops
- 1.4%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 10 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
- 15
- Loan volume
- $13.7M
- Median loan
- $913K
- average
- Charge-off rate
- 100.0%
- 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)
- N/A
- 5-yr charge-off
- 100.0%
- Loans approved 2021+
- Active lenders
- 10
- Defaults
- 2
Explore lender portfolios on Bank Reports or regional data on State Reports.
A 100.0% charge-off rate means roughly 1 in 1 franchisees failed to repay their SBA loan. Investigate what changed.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
ZIPS presents moderate-to-elevated risk due to unverified financial claims, slow growth trajectory, high capital requirements relative to net margins, and industry sector headwinds, warranting careful validation with existing franchisees.
Litigation (Item 3)
No litigation required to be disclosed
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · SC&H Attest Services, P.C.
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 75 / 100 rating
- 01MEDNo Item 19 (Financial Performance Representations) disclosed — cannot independently verify the $1.26M average revenue and $368K net income claims
- 02MINORSlow unit growth of 6.1% YoY suggests market saturation or franchisee struggles in a mature 72-unit system
- 03MEDHigh initial investment ($761K–$1.2M) combined with 6% royalties creates significant breakeven pressure; net margin of only 29% leaves limited cushion
- 04HIGHGoing Concern status is FALSE — this is atypical reporting that raises questions about financial transparency and corporate stability
- 05MINORDry cleaning is a declining industry sector with structural headwinds (declining formal wear usage, environmental concerns, changing consumer habits)
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 | 5 years |
| Allowed renewalsℹ | 2 |
| Territory type | Radius, metes and bounds, or zip codes |
| Protected territory | Yes |
| Exclusive territoryℹ | No |
| Online sales rightsℹ | Granted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Right of first refusalℹ | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | No |
| Jury trial waiver | Yes |
| Governing law | Maryland |
| Litigation count | 0 |
View Item 3 litigation summary
No litigation required to be disclosed
Items 10, 11
Training & Operations
- Classroom training
- 40 hrs
- On-the-job training
- 120 hrs
- Training location
- On-site and off-site
- Ongoing training
- Required
- POS system
- ZIPSsoft Software
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: ZIPSsoft Software
Item 20 · call current owners
Franchisee Contacts
69 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
ZIPS Cleaners · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a ZIPS Cleaners franchise?
The total investment to open a ZIPS Cleaners franchise ranges from $762K – $1.2M, with an initial franchise fee of $30K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do ZIPS Cleaners franchise owners earn?
According to Item 19 of the ZIPS Cleaners FDD, the average gross sales per unit is $1.5M. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is ZIPS Cleaners's franchise failure rate?
Based on SBA 7(a) loan data, ZIPS Cleaners has a charge-off rate of 100.0% across 15 loans, meaning 100.0% 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 ZIPS Cleaners franchise locations are there?
As of their most recent FDD filing, ZIPS Cleaners has 72 total units in the United States, including 70 franchised units and 2 company-owned units. 4 new units were opened in the latest reporting year.
Is ZIPS Cleaners a good franchise to buy?
FranchiseVerdict rates ZIPS Cleaners as a D-grade franchise with a risk score of 75 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.
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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.