Verified — real FDD extraction
SBA-eligible · directory code S1398 since 2017
CHECKERS RESTAURANT OR RALLY'S RESTAURANT
Food & Dining · independent · est. —
Checkers and Rally's are sister fast-food chains known for budget-priced burgers, seasoned fries, and milkshakes served from compact buildings with double drive-thru lanes and walk-up windows instead of indoor dining rooms. A franchisee runs a quick-service location, managing cooks and window staff, food prep, and high-volume drive-thru order flow.
CHECKERS RESTAURANT OR RALLY'S RESTAURANT net unit count declined -7.2% from 2021–2023 per its FDD Item 20.
New to franchising? Start here
A franchise is a business where you (the franchisee) pay a company (the franchisor) for the right to open and run a location using their brand and system — think a local Anytime Fitness or Taco John's owned by a small-business owner, not the corporation.
Before you can buy in, U.S. law requires the franchisor to give you a Franchise Disclosure Document (FDD) — a long legal filing covering its fees, finances, and history. The numbers on this page come straight from that document:
- Franchise fee — the one-time cost to buy in.
- Royalty — the ongoing cut of your sales you pay the franchisor.
- Item 20 — how many locations opened and closed, the basis for our verdict (from Proven & strong down to Distressed — or Too new to judge).
The verdict
Proven & steady
Distress
A real track record with an unremarkable region of the ledger: neither the growth nor the exits stand out, for better or worse. The main concern in the record: the system is shrinking.
Exit rate · latest year
10.3%
vs 8.6% across 137 food & dining systems
Cost to open
$192K–$2.8M
Item 7 total investment range
SBA loan defaults
9.4%
vs 14.8% avg across rated brands
Behind the verdict
the record, factor by factor · Item 20
3-yr trend · Item 20 Table 1
terminations + ceased-ops vs. all exits · Table 3
transfers vs. base · Table 3
actual vs. projected openings · Table 5
Item 19 disclosure + completeness
Systemwide units
2021–2023
Survival record
FDD Item 20 · outlet status by year
In fiscal 2023, 60 of 585 franchised outlets left the system — a 10.3% annualized exit rate, vs 8.6% across 137 food & dining systems. Not every exit is a failure — but this is the measurable floor.
Show the outlet tables ↓Hide the evidence ↑
| Status (FTC) | 2021 | 2022 | 2023 |
|---|---|---|---|
| Outlets at start | 858 | 846 | 840 |
| Opened | 10 | 39 | 22 |
| Transfers | 66 | 37 | 33 |
| Terminations | 23 | 0 | 0 |
| Non-renewals | 0 | 0 | 0 |
| Reacquired by franchisor | 0 | 0 | 0 |
| Ceased — other reasons | 2 | 29 | 60 |
| Outlets at end | 846 | 840 | 785 |
| Net change | -12 | -6 | -55 |
The lender's view
SBA 7(a)/504 loan performance · FY1991–present
Banks have made 109 SBA-backed loans to CHECKERS RESTAURANT OR RALLY'S RESTAURANT franchisees since 2013. Of the 53 that have resolved, 9.4% were charged off (defaulted) rather than paid in full, versus 14.8% across 576 rated brands.
9.4%
5 of 53 resolved defaulted
64.0%
avg. charged-off $ ÷ approved $
6.0%
default rate × loss severity
$1,066,208
what recent franchisees borrowed
83 mo
approval → charge-off, defaulted loans
20 vs 28
distinct banks still lending
Charge-off rate by loan approval year (%)
SOURCE: SBA 7(a)/504 FOIA LOAN DATA (DATA.SBA.GOV), FY1991–PRESENT · MATCHED TO CHECKERS RESTAURANT OR RALLY'S RESTAURANT BY FRANCHISE NAME · RESOLVED = CHARGED-OFF + PAID-IN-FULL
The owner's side of the deal
FDD × federal loan record
Who finances it
the Huntington National Bank
11.3% of this brand's loans
That lender charges off 10.0% of its loans to other franchise brands, vs 14.8% nationally.
Who buys it
61.0%
first-time franchise owners
The rest already owned at least one other franchise. Across the corpus, brands bought mostly by repeat operators charge off at roughly 10% versus 17% for brands sold mostly to newcomers.
Does experience help here?
+29.4pp
multi-unit vs single-unit owners
Owners of multiple units default at 29.4%; single-unit owners at 0.0%.
Computed from 109 SBA 7(a)/504 loans to CHECKERS RESTAURANT OR RALLY'S RESTAURANT franchisees joined to the brand's own FDD. Debt service assumes level amortization at the average disclosed term and rate. A lender's rate excludes its loans to this brand, so it reads the lender, not the brand.
What it costs — and what it drags
FDD Items 5–7 · fees, investment, royalty
Buying in means a $30K franchise fee (Item 5) and a total investment of $192K–$2.8M (Item 7). The franchisor publishes an earnings claim (Item 19) — read its methodology closely.
To open (Item 7)
$192K–$2.8M
all-in investment range
Franchise fee (Item 5)
$30K
upfront, one-time
Royalty (Item 6)
4%
of sales, ongoing
Your figure — cross-check against this brand's Item 19 and current-owner validation.
Royalty you'd pay / yr
$40K
4% of sales, before profit
Over a 10-yr term
$400K
royalties alone, excl. ad fund
This is not profit. It's the only money the FDD actually pins down — what you put in, and the royalty you owe on every dollar of sales. Your real take-home depends on labor, rent, food cost, and ramp-to-breakeven, none of which any FDD discloses.
Build a real pro-forma for CHECKERS RESTAURANT OR RALLY'S RESTAURANT with an independent CPAModeled risk
FDD Risk Score · modeled from the public record
Modeled from the public record, this brand looks safer than 73% of systems we score.
Risk percentile
27 / 100
Loan-corroborated
Modeled SBA charge-off
9.6%
Observed SBA charge-off
9.4%
Top drivers: Investment ceiling (log) (lowers) · System size (log units) (lowers) · Share financed by high-loss lenders (lowers) · Single-lender dependence (raises). 15+ resolved loans stand behind this estimate. A linear scorecard built from this brand's own disclosure figures plus the federal loan record behind its franchisees; full spec and cross-validated accuracy on the methodology page. A score is context, not a verdict.
Distress signals
news-sourced · bankruptcies, closures, lawsuits
No recent closures, bankruptcies, or major lawsuits found in the news for CHECKERS RESTAURANT OR RALLY'S RESTAURANT. That's a good sign — but it reflects news coverage, not a guarantee.
A broker is paid by the franchisor to place you. An independent CPA is paid by you — and the job is pressure-testing CHECKERS RESTAURANT OR RALLY'S RESTAURANT's numbers, including talking you out of a bad deal.
Talk to an independent CPA before you buy →CHECKERS RESTAURANT OR RALLY'S RESTAURANT franchise questions, answered from the filings
What percentage of CHECKERS RESTAURANT OR RALLY'S RESTAURANT franchises closed last year?
In CHECKERS RESTAURANT OR RALLY'S RESTAURANT's latest FDD Item 20 (fiscal 2023), 60 of 585 franchised outlets left the system — an annualized exit rate of 10.3% — compared with 8.6% across 137 food & dining systems tracked here. That counts terminations, non-renewals, and "ceased operations — other reasons." There is no official failure rate, and not every exit is a failure, but this is the measurable floor.
How much does a CHECKERS RESTAURANT OR RALLY'S RESTAURANT franchise cost?
Per CHECKERS RESTAURANT OR RALLY'S RESTAURANT's 2024 FDD, buying in requires an initial franchise fee of $30K (Item 5) and a total initial investment of $192K–$2.8M (Item 7).
What royalty does CHECKERS RESTAURANT OR RALLY'S RESTAURANT charge?
CHECKERS RESTAURANT OR RALLY'S RESTAURANT charges an ongoing royalty of 4.0% of gross sales, per Item 6 of its 2024 FDD.
Does CHECKERS RESTAURANT OR RALLY'S RESTAURANT disclose earnings (Item 19)?
Yes — CHECKERS RESTAURANT OR RALLY'S RESTAURANT makes a financial performance representation in Item 19 of its 2024 FDD. Read it closely: franchisors choose which units and which metrics to include.
How often do SBA loans for CHECKERS RESTAURANT OR RALLY'S RESTAURANT franchises default?
Across 109 SBA-backed loans to CHECKERS RESTAURANT OR RALLY'S RESTAURANT franchisees since 2013, 5 of the 53 that have resolved were charged off — a 9.4% default rate, versus about 14.8% across all rated franchise brands. This is the lender's-eye view of franchisee failure, drawn from public SBA 7(a)/504 FOIA data and independent of the franchisor's own disclosures.