Sample data — illustrative, not for citation
Not found in the SBA Franchise Directory under this name — though SBA loans to its franchisees exist; verify eligibility with your lender
FATBURGER
Other · independent · est. —
Fatburger is a fast-casual burger chain serving made-to-order burgers, fries, and shakes. A franchisee operates a counter-service restaurant, often developed in multi-unit deals, serving dine-in and takeout burger customers.
FATBURGER net unit count declined -24.6% from 2022–2025 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
Not enough disclosure
Distress
No verified FDD extraction to judge from. Any figures shown are labelled sample data or independent federal records.
SBA loan defaults
13.6%
22 loans resolved — directional only
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
2022–2025
Survival record
FDD Item 20 · outlet status by year
Show the outlet tables ↓Hide the evidence ↑
| Status (FTC) | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Outlets at start | 192 | 206 | 187 | 170 |
| Opened | 27 | 3 | 3 | 2 |
| Transfers | 0 | 8 | 7 | 6 |
| Terminations | 0 | 10 | 9 | 9 |
| Non-renewals | 0 | 3 | 3 | 2 |
| Reacquired by franchisor | 0 | 0 | 0 | 0 |
| Ceased — other reasons | 16 | 9 | 8 | 8 |
| Outlets at end | 203 | 187 | 170 | 153 |
| Net change | +11 | -19 | -17 | -17 |
The lender's view
SBA 7(a)/504 loan performance · FY1991–present
Banks have made 39 SBA-backed loans to FATBURGER franchisees since 1992. Only 22 have resolved so far — too thin for a reliable default rate, but 3 of them charged off.
—
22 resolved · too thin to rate
—
avg. charged-off $ ÷ approved $
—
default rate × loss severity
$662,116
what recent franchisees borrowed
53 mo
approval → charge-off, defaulted loans
10 vs 7
distinct banks still lending
Charge-off rate by loan approval year (%)
Loan performance by state
SOURCE: SBA 7(a)/504 FOIA LOAN DATA (DATA.SBA.GOV), FY1991–PRESENT · MATCHED TO FATBURGER BY FRANCHISE NAME · RESOLVED = CHARGED-OFF + PAID-IN-FULL
The owner's side of the deal
FDD × federal loan record
A typical FATBURGER buyer since 2020 borrowed $662K through SBA — about $91K a year in debt service. Against the brand's own disclosed median unit revenue of $1.1M, that is 8.4% of every dollar the store takes in — before rent, payroll, food, or royalty.
Who finances it
Wells Fargo Bank National Association
11.1% of this brand's loans
That lender charges off 15.6% of its loans to other franchise brands, vs 14.8% nationally.
Who buys it
Too few identified operators
Does experience help here?
Not enough resolved loans to split
Computed from 39 SBA 7(a)/504 loans to FATBURGER 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
To open (Item 7)
$567K–$1.1M
all-in investment range
Franchise fee (Item 5)
$50K
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 FATBURGER with an independent CPALabor record
US Dept. of Labor enforcement · franchisee-level · FY2005–present
Federal investigators have concluded 1 wage case against operators of this system, recovering $4K in back wages for 23 workers, including 1 child-labor case. Some of these cases are recent, not ancient history. These cases name franchisee-owned locations, not the franchisor itself.
Concluded cases
1
Back wages owed
$4K
Employees affected
23
Since 2020
1
1 of these cases involved child-labor violations, covering 1 minors across the system's franchised locations.
Read this carefully. The employers in these cases are individual FATBURGER franchisees — separately owned businesses operating under the brand name — not FATBURGER 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 2023.
Distress signals
news-sourced · bankruptcies, closures, lawsuits
Cali-based chain Fatburger closes last remaining outpost in San Antonio
news:MSN · 1mo ago
Cali-based chain Fatburger closes last remaining outpost in San Antonio
news:San Antonio Express-News · 1mo ago
Another Fatburger closes in SA amid parent company's bankruptcy troubles
news:The Business Journals · 1mo ago
Cali chain Fatburger closes last standalone San Antonio restaurant
news:CultureMap San Antonio · 1mo ago
A broker is paid by the franchisor to place you. An independent CPA is paid by you — and the job is pressure-testing FATBURGER's numbers, including talking you out of a bad deal.
Talk to an independent CPA before you buy →