Verified — real FDD extraction
SBA-eligible · directory code S0400 since 2017
Cold Stone Creamery
Food & Dining · independent · est. —
Cold Stone Creamery is an ice cream chain where mix-ins are folded into ice cream on a frozen granite slab. Franchisees operate retail ice cream shops selling ice cream, shakes, and cakes to walk-in customers.
Cold Stone Creamery net unit count grew +17.9% from 2021–2025 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 & strong
Distress
Enough units and history to judge, and the record is good: growing or stable units with clean exits by the standards of its disclosed record. The standout in the record: owners who leave mostly sell rather than fail.
Exit rate · latest year
0.3%
vs 8.2% across 146 food & dining systems
Cost to open
$391K–$681K
Item 7 total investment range
SBA loan defaults
30.7%
vs 14.8% avg across rated brands
Market density · California
Typical density
12% denser than the national average
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
2021–2025
Survival record
FDD Item 20 · outlet status by year
In fiscal 2025, 3 of 992 franchised outlets left the system — a 0.3% annualized exit rate, vs 8.2% across 146 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 | 2024 | 2025 |
|---|---|---|---|---|---|
| Outlets at start | 882 | 894 | 912 | 953 | 994 |
| Opened | 18 | 27 | 49 | 52 | 63 |
| Transfers | 82 | 83 | 79 | 62 | 79 |
| Terminations | 0 | 0 | 0 | 0 | 0 |
| Non-renewals | 3 | 5 | 5 | 3 | 2 |
| Reacquired by franchisor | 2 | 1 | 0 | 1 | 0 |
| Ceased — other reasons | 3 | 4 | 3 | 8 | 1 |
| Outlets at end | 894 | 912 | 953 | 994 | 1,054 |
| Net change | +12 | +18 | +41 | +41 | +60 |
The lender's view
SBA 7(a)/504 loan performance · FY1991–present
Banks have made 1,249 SBA-backed loans to Cold Stone Creamery franchisees since 1997. Of the 931 that have resolved, 30.7% were charged off (defaulted) rather than paid in full, versus 14.8% across 570 rated brands.
30.7%
286 of 931 resolved defaulted
67.2%
avg. charged-off $ ÷ approved $
20.6%
default rate × loss severity
$386,413
what recent franchisees borrowed
74 mo
approval → charge-off, defaulted loans
69 vs 43
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 COLD STONE CREAMERY BY FRANCHISE NAME · RESOLVED = CHARGED-OFF + PAID-IN-FULL
The owner's side of the deal
FDD × federal loan record
Who finances it
Fifth Third Bank
13.2% of this brand's loans
That lender charges off 27.4% of its loans to other franchise brands, vs 14.8% nationally.
Who buys it
69.6%
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?
−4.6pp
multi-unit vs single-unit owners
Owners of multiple units default at 30.9%; single-unit owners at 35.5%.
Computed from 1,249 SBA 7(a)/504 loans to Cold Stone Creamery 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 $27K franchise fee (Item 5) and a total investment of $391K–$681K (Item 7). The franchisor publishes an earnings claim (Item 19) — read its methodology closely.
To open (Item 7)
$391K–$681K
all-in investment range
Franchise fee (Item 5)
$27K
upfront, one-time
Royalty (Item 6)
6%
of sales, ongoing
Your figure — cross-check against this brand's Item 19 and current-owner validation.
Royalty you'd pay / yr
$60K
6% of sales, before profit
Over a 10-yr term
$600K
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 Cold Stone Creamery with an independent CPALabor record
US Dept. of Labor enforcement · franchisee-level · FY2005–present
Federal investigators have concluded 69 wage cases against operators of this system, recovering $89K in back wages for 619 workers, including 41 child-labor cases. Some of these cases are recent, not ancient history. These cases name franchisee-owned locations, not the franchisor itself.
Concluded cases
69
Back wages owed
$89K
Employees affected
619
Since 2020
17
41 of these cases involved child-labor violations, covering 350 minors across the system's franchised locations.
Read this carefully. The employers in these cases are individual Cold Stone Creamery franchisees — separately owned businesses operating under the brand name — not Cold Stone Creamery itself. The franchisor is not the respondent and in most cases is not a party. What the record shows is how this system's operators run their payrolls, which is worth knowing before you become one of them. Counts rise with system size and with age: a 20-year-old, 10,000-unit system will out-count a young one regardless of conduct. Source: DOL Wage and Hour Division concluded compliance actions, FY2005–present, most recent finding 2024.
Distress signals
news-sourced · bankruptcies, closures, lawsuits
Zona Rosa sues to evict Cold Stone Creamery for not paying rent since November
news:The Business Journals · 2mo ago
Cold Stone Creamery sues Stuyvesant Plaza
news:The Altamont Enterprise · 3mo ago
Cold Stone Creamery sued over ‘pistachio’ ice-cream with no pistachios
news:The Guardian · 28mo ago
9 questions to ask a Cold Stone Creamery franchisee
Built from this brand's own disclosures · take it to your validation calls
The franchisor will give you a list of owners to call. Most buyers ask whether they like it. These are the questions built from what Cold Stone Creamery has actually disclosed — each one carries the number it came from, so you can tell whether the answer squares with the record.
- 01
Cold Stone Creamery’s own Item 20 shows 3 of 992 franchised outlets left the system in fiscal 2025 — about 0.3%. Do you know any of those owners, and do you know why they left?
A franchisor will call these “transitions.” An owner three doors down usually knows whether they sold at a profit or handed the keys back.
FDD Item 20 · FY2025
- 02
79 units transferred to new owners in fiscal 2025. When you look at those, were they people cashing out a good business — or getting out of a bad one?
Transfers count as neutral in every ranking. They are the single easiest place to hide distress.
FDD Item 20 · FY2025
- 03
Of 931 SBA loans to Cold Stone Creamery franchisees that have finished, 30.7% were charged off — the borrower didn't repay. Did you finance with an SBA loan, and how close did your first two years come to trouble?
This is the lender's view of failure, from public federal records, and it is independent of anything the franchisor discloses.
SBA 7(a)/504 loan record, FY1991–present
- 04
You pay 6.0% royalty on gross sales, plus the ad fund, before any of your own costs. On your actual revenue last year, what did you take home as the owner — not revenue, take-home?
Royalty is charged on sales, not profit. This is the number the brochure never shows and the one your life actually runs on.
FDD Item 6
- 05
Cold Stone Creamery makes an earnings claim in Item 19. Does your unit look like that number — and do you know which units they included to build it?
Item 19 is legal to build from a flattering subset. Ask whether they excluded new units, closed units, or company stores.
FDD Item 19 · 2026
- 06
How many months did it take to cover your own costs, and how much cash did you burn getting there?
Ramp-to-breakeven working capital is the most underestimated line in any franchise purchase, and the most common reason otherwise-good units fail.
Not disclosed in any FDD — ask an owner
- 07
What does the franchisor charge for that you didn't expect — required tech fees, mandatory remodels, approved-supplier pricing?
Required spending appears across Items 6, 8 and 11 rather than in one place, so buyers routinely miss the total.
FDD Items 6, 8, 11
- 08
If your agreement came up for renewal tomorrow at current terms, would you sign again?
The single most predictive question you can ask. A hesitation is the answer.
Ask every owner you speak to
- 09
Who else should I call — including someone who left?
The franchisor's list is curated by definition. Former franchisees are where the unflattering truth lives, and current owners usually know how to reach them.
Ask every owner you speak to
Want this as a checklist you can take to the calls?
I'll email you the printable version, and tell you if Cold Stone Creamery’s numbers move — a new filing, a rising exit rate, a distress signal. Unsubscribe in one click.
A broker is paid by the franchisor to place you. I'm paid by you — and the job is pressure-testing Cold Stone Creamery's numbers, including talking you out of a bad deal.
This page is what buyers see before they call you for validation. If the record above is wrong — or right in a way the numbers can't show — say so. Corrections are checked against the filings; nothing you write is published with your name unless you agree to it.
Cold Stone Creamery franchise questions, answered from the filings
What percentage of Cold Stone Creamery franchises closed last year?
In Cold Stone Creamery's latest FDD Item 20 (fiscal 2025), 3 of 992 franchised outlets left the system — an annualized exit rate of 0.3% — compared with 8.2% across 146 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 Cold Stone Creamery franchise cost?
Per Cold Stone Creamery's 2026 FDD, buying in requires an initial franchise fee of $27K (Item 5) and a total initial investment of $391K–$681K (Item 7).
What royalty does Cold Stone Creamery charge?
Cold Stone Creamery charges an ongoing royalty of 6.0% of gross sales, per Item 6 of its 2026 FDD.
Does Cold Stone Creamery disclose earnings (Item 19)?
Yes — Cold Stone Creamery makes a financial performance representation in Item 19 of its 2026 FDD. Read it closely: franchisors choose which units and which metrics to include.
How often do SBA loans for Cold Stone Creamery franchises default?
Across 1,249 SBA-backed loans to Cold Stone Creamery franchisees since 1997, 286 of the 931 that have resolved were charged off — a 30.7% 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.