ZIPS Cleaners
Bottom line
- Total investment $762K – $1.2M including a $30K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $1.3M/year (median $1.1M). Estimated payback in 2.7 years.
- Rated STRONG with a risk score of 41/100. SBA loan default rate of 0.0% across 24 loans (below the industry average).
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 ZIPS Cleaners unit return on the cash you put in?
Unlevered ROIC · per unit
12%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 ZIPS Cleaners 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
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.
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 · 11 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
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.
Score breakdown · what drove the 41 / 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
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
77 numbers
One-time purchase · CSV download · Validation questions included
FDD download
ZIPS Cleaners · FDD (2025) PDF