MOE'S SOUTHWEST GRILL

Franchising since 2001 under GoTo Foods, Moe's grew to 606 locations in 2023 before contracting 2% to 591 in 2024, with just 5 corporate-owned spots. System health flags include 25 terminations, 5 non-renewals, and a striking 60 transfers—far above average, hinting at franchisee reshuffling or dissatisfaction. Projected new units sit at only 10, signaling cautious expansion. Litigation centers on disputes with one franchisee group (Taylor Investment Partners) over terminations, breaches, and even trademark issues, per FDD notes. Item 7 outlines a $30,500 franchise fee, plus ongoing 5% royalties, 3% brand/ad fund (potentially up to 4%), and monthly fixed fees of $460-$1,247 for POS, apps, and support—stacking up to notable ongoing costs.

Item 19 shines with average gross revenue of $1,235,422 and median $1,166,787 across units, strong for fast-casual but demanding high volume to cover fees and ops. SBA data shows 83 loans averaging $525,101, but an 8.4% default rate exceeds typical benchmarks, suggesting financing risks amid economic pressures. For investors eyeing this, the revenue punch appeals in a burrito-boom category, yet contraction, turnover, and litigation whisper caution—veteran operators might thrive leveraging the brand's supply chain, but newcomers face a maturing, competitive system where transfers dominate growth.