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FAZOLI'S
Fazoli’s Franchising Systems, LLC is a franchisor of premium fast-casual Italian restaurants offering pasta, subs, salads, pizza, and desserts in freestanding, in-line end-cap, nontraditional (e.g., colleges, airports), and delivery-only ghost kitchen formats. Franchisees operate according to strict brand standards, paying initial franchise fees and ongoing royalties, with total investments varying by location type from about $472,500 to $2,641,500 excluding real estate. The target market is the general public in the highly competitive quick-service and casual dining sectors.
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Franchise Costs
5% royalty + 4% ad fund + $1,284-$2,021/mo fixed fees (technology support, software, accounting review)
Financial Performance
Item 19 Financial Performance
Data Based On: 136 franchised Restaurants (132 Traditional and 4 Non-traditional) that met Reporting Criteria for Fiscal Year 2024
* Used the 'Average (Mean) Net Revenue (Total)' value provided in Table 2 for franchised restaurants, as it is an overall average. Revenue top quartile and bottom quartile are derived from the 'Average (Mean) Net Revenue' of the Upper and Lower tercile segments, respectively, as per the document's segmentation. Average EBITDA and EBITDA margin are estimated using the 'Restaurant Cash Flow' percentage (4.8%) from the 'Total' column of Table 1 (Company-Owned Restaurants), which aligns with the definition of EBITDA. This percentage includes imputed royalties and advertising fees (9.0% as per Note 6) that franchisees incur. Best guess profit range is estimated by applying the highest (12.6%) and lowest (-9.2%) 'Restaurant Cash Flow' percentages from the Upper and Lower terciles of Table 1 (Company-Owned Restaurants) to the franchised average gross revenue, as per the definition of Restaurant Cash Flow (which includes expenses relevant to franchisees).
Extracted Item 19 Section
Avg. Revenue: $1,312,096
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Unlock financial performance dataFAZOLI'S Franchise Analysis
Imagine sinking millions into a fast-casual Italian chain that's been around since 1991, only to watch total locations drop amid fierce QSR competition. Item 19 earnings data paints a volatile picture for franchisees, while a bankruptcy blemish and SBA financing trends whisper caution. Can FAT Brands turn this around with just 4 new units projected, or is the contraction a red flag demanding deeper scrutiny?
Item 7 lays out the steep entry: $1,480,000-$2,340,000 total investment for traditional units, including a $50,000 franchise fee, driven by buildout and equipment in high-traffic spots. Ongoing fees from Item 6 hit 5% royalty plus 4% brand/ad fund, layered with $1,284-$2,021 monthly fixed costs for tech and accounting—eating into slim margins. Item 19 shines light on 2024 performance across comparable units: average gross revenue of $1,312,096, median $1,247,845, but EBITDA margin stuck at 0%, with estimated profits swinging wildly from -$120,713 losses to $165,324 gains, underscoring operational inconsistency in a tough casual dining arena.
System health metrics from Items 20/21 reveal contraction: 150 locations in 2023 dwindled to 139 franchised plus 56 corporate by 2024—a 7% drop—with only 1 non-renewal but stagnant growth under FAT Brands. Projections call for meager 4 new units, while 21 SBA loans averaging $831,552 carry a 9.5% default rate, higher than many peers and tied to the brand's bankruptcy past. For investors eyeing $1.3M top-line potential, this signals high-risk turnaround play rather than steady expansion—breakeven hinges on top-quartile execution amid pizza-pasta price wars.
Analysis based on the 2025 Franchise Disclosure Document. All figures should be independently verified before making investment decisions.
How FAZOLI'S Compares
Key Insights
- Higher investment than 97% of Fast Casual franchises
- Lower than average SBA loan default rate in Fast Casual
| Franchise | Investment | Fee | Royalty | Locations |
|---|---|---|---|---|
FAZOLI'S Current | $1.5M – $2.3M | $50K | 5.0% | 139 |
| Tropical Smoothie Cafe | $276K – $771K | $35K | 6.0% | 1,650 |
| TROPICAL SMOOTHIE CAFÉ | $300K – $721K | $35K | 6.0% | 1,371 |
| FIREHOUSE SUBS RESTAURANTS (UNIT) | $405K – $1.6M | $20K | 6.0% | 1,249 |
| Zaxby's | $1.4M – $3.8M | $35K | 6.0% | 826 |
| Qdoba | $548K – $1.3M | $40K | 5.0% | 652 |
Fast Casual Average 107 franchises | $529K – $1.2M | $39K | 5.6% | – |
* Comparison based on latest FDD filings. Investment ranges from Item 7, fees from Item 5. Showing top 5 of 107 Fast Casual franchises by location count.
Locations & Growth
Outlet Growth Over Time
Total outlets at end of each year
Geographic Distribution (2024)
Outlets by state across the United States
+12 more states
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Unlock location growth dataSBA Loan History
Historical SBA 7(a) loan data for FAZOLI'S franchisees (2010 – 2023)
Loans by Year
SBA 7(a) loan activity over time
* Data sourced from SBA 7(a) FOIA loan records. Default rate calculated from charged-off loans.
21 SBA loans on record
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Unlock SBA loan historyFranchisee Contacts
143 franchisee contacts on file from official FDD filings.
143 Contacts Available
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Unlock contactsDue Diligence
Litigation (Item 3)
Bankruptcy (Item 4)
Parent company, Twin Hospitality Group Inc., and subsidiary entities including Fazoli's Franchising Systems, LLC filed voluntary Chapter 11 petitions on January 25, 2026, in the U.S. Bankruptcy Court for the Southern District of Texas.
System Health (Item 20)
Franchise system changes reported in the most recent fiscal year
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Unlock due diligence reportsFrequently Asked Questions
The total initial investment to open a FAZOLI'S franchise ranges from $1,480,000 to $2,340,000. This includes a franchise fee of $50,000. Ongoing royalty fees are 5.0% of gross sales.