The Zaxby's franchise requires a total investment of $1.45M – $3.81M with a 6.0% royalty fee and operates 969 units in the QSR category. This report analyzes the full Franchise Disclosure Document including unit economics, fee structure, growth trends, and risk indicators to help you evaluate the cost of investing in Zaxby's.
Critical issues identified from FDD analysis that warrant serious consideration before investing.
Composite quality score based on growth, stability, efficiency, fees, transparency, and system size.
Estimated initial investment range as disclosed in the most recent FDD.
| Line Item | Low Estimate | High Estimate |
|---|---|---|
| Franchise Fee | $35,000 | $35,000 |
| Real Estate | $10,000 | $19,000 |
| Other | $0 | $9,000 |
| Buildout | $640,000 | $1,300,000 |
| Buildout | $150,000 | $990,000 |
| Other | $45,000 | $110,000 |
| Other | $2,000 | $150,000 |
| Legal Accounting | $500 | $25,000 |
| Equipment | $445,000 | $497,000 |
| Technology | $60,500 | $217,500 |
| Signage | $23,000 | $245,000 |
| Insurance | $1,000 | $17,000 |
| Other | $300 | $1,000 |
| Other | $5,200 | $10,000 |
| Inventory | $5,000 | $22,000 |
| Other | $1,500 | $5,000 |
| Training | $10,000 | $25,000 |
| Other | $10,000 | $37,000 |
| Working Capital | $1,000 | $96,000 |
| Total | $1,445,000 | $3,810,500 |
Ongoing fees as disclosed in the FDD.
| Fee Type | Rate | Type | Basis | Frequency |
|---|---|---|---|---|
| Royalty | 6.0% | PCT | Gross Sales | weekly |
| Weekly Marketing Contributions | 4.0% | PCT | Gross Sales | weekly |
| National Marketing Contribution | 1.5% | PCT | Gross Sales | weekly |
| Co-op Marketing Contribution or Multi-DMA Advertising Contribution | 3.0% | PCT | Gross Sales | weekly |
| Technology Services Fee (TSF) | $0 | FIXED | Per Transaction | monthly |
| Supplier Approval | N/A | VARIABLE | Actual costs | one_time |
| Initial Training for Replacement Managers | $2,500 | FIXED | Per Person | one_time |
| On-Site Additional or Remedial Training or Consulting Services | N/A | VARIABLE | Actual costs | one_time |
| Franchised Managed Training Program Fee | $1,000 | VARIABLE | Per Restaurant | annually |
| Conference Fee | N/A | VARIABLE | Per Event | one_time |
| Transfer Fee (Franchise Agreement) | 50.0% | PCT | 50% of then-current Initial Franchise Fee | one_time |
| Transfer Fee (Development Agreement) | $7,500 | FIXED | Per Transfer | one_time |
| Late Fees and Interest | 18.0% | PCT | Per annum on late payments | weekly |
| Audit Fee | N/A | VARIABLE | Cost of audit | one_time |
| Indemnification / Attorneys' Fees and Costs / Damages | N/A | VARIABLE | Actual costs and losses | one_time |
| Inspection Fee | N/A | VARIABLE | Actual costs per inspection | one_time |
| Document Fee | N/A | VARIABLE | Actual costs | one_time |
| Renewal Fee | 50.0% | PCT | 50% of then-current Initial Franchise Fee | one_time |
| Substitute Royalty Fees and Marketing Fees | N/A | VARIABLE | Greater of historical amounts | monthly |
| Zax Rewardz Program | $0 | FIXED | Per dollar of Gross Sales from Zax Rewardz members | weekly |
Financial Performance Representations not disclosed by this franchisor
Approximately 40% of franchisors choose not to include Item 19 financial performance data in their FDD. This does not necessarily indicate poor performance -- it simply means the franchisor has elected not to disclose this information.
Model your personal financial scenario by adjusting the assumptions below.
Automated risk indicators based on FDD data analysis.
Franchise unit trajectory based on FDD Item 20 data.
| Year | Start | Opened | Closed | Transferred | End | Closure Rate | Net Growth |
|---|---|---|---|---|---|---|---|
| 2022 | 765 | +17 | -- | 56 | 776 | -- | +11 |
| 2023 | 776 | +26 | -6 | 27 | 796 | 0.8% | +20 |
| 2024 | 796 | +37 | -6 | 58 | 826 | 0.8% | +30 |
How Zaxby's compares to peer brands in the QSR category.
Ratio = Investment midpoint ÷ median annual revenue. Lower is better. A 0.5x ratio means the initial investment equals half of one year's gross revenue. Does not account for operating costs, margins, or time value of money.
| Brand | Total Units | Investment Range | Median Revenue | Royalty | Inv/Rev Ratio |
|---|---|---|---|---|---|
| Subway | 19502 | $3K – $630K | No Item 19 | -- | -- |
| McDonald's | 12772 | $1.47M – $2.64M | No Item 19 | 5.0% | -- |
| Dunkin' | 8499 | $527K – $1.83M | $1.43M | -- | 0.8x |
| Domino's Pizza | 7043 | -- | $24K | 5.5% | -- |
| Burger King | 6701 | -- | No Item 19 | -- | -- |
| Wendy's | 5552 | $393K – $2.99M | $2.23M | 4.0% | 0.8x |
| Little Caesars | 3705 | $446K – $1.82M | No Item 19 | 6.0% | -- |
| KFC | 3558 | $135K – $3.77M | $1.27M | 5.0% | 1.5x |
| Papa John's | 3291 | $261K – $853K | No Item 19 | 5.0% | -- |
| Popeyes Louisiana Kitchen | 3177 | $505K – $3.92M | No Item 19 | 5.0% | -- |
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