Verified — real FDD extraction
SBA-eligible · directory code S8185 since 2025
Up Closets
Other · independent · est. —
Up Closets is a home-services franchise that designs, builds, and installs custom closets and storage solutions like pantries, garages, and home offices. Franchisees meet homeowners, design the storage system, and arrange manufacturing and installation. The day-to-day work is in-home sales and project management rather than running a retail store.
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: owners are leaving at a high rate.
Exit rate · latest year
14.6%
fiscal 2025, per Item 20
Cost to open
$95K–$151K
Item 7 total investment range
SBA loan defaults
Too few resolved
8 loans exist; too few resolved to rate
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, 6 of 41 franchised outlets left the system — a 14.6% annualized exit rate. 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 | 0 | 2 | 2 | 16 | 44 |
| Opened | 0 | 2 | 13 | 36 | 41 |
| Transfers | 0 | 0 | 0 | 4 | 3 |
| Terminations | 0 | 0 | 0 | 3 | 6 |
| Non-renewals | 0 | 0 | 0 | 0 | 0 |
| Reacquired by franchisor | 0 | 0 | 0 | 0 | 0 |
| Ceased — other reasons | 0 | 0 | 0 | 5 | 0 |
| Outlets at end | 0 | 0 | 16 | 44 | 79 |
| Net change | 0 | -2 | +14 | +28 | +35 |
The lender's view
SBA 7(a)/504 loan performance · FY1991–present
Banks have made 8 SBA-backed loans to Up Closets franchisees since 2025. Most are still open, so there is not yet a resolved cohort large enough to rate.
—
0 resolved · too thin to rate
—
avg. charged-off $ ÷ approved $
—
default rate × loss severity
$184,375
what recent franchisees borrowed
—
approval → charge-off, defaulted loans
—
distinct banks lending
Charge-off rate by loan approval year (%)
SOURCE: SBA 7(a)/504 FOIA LOAN DATA (DATA.SBA.GOV), FY1991–PRESENT · MATCHED TO UP CLOSETS BY FRANCHISE NAME · RESOLVED = CHARGED-OFF + PAID-IN-FULL
What it costs — and what it drags
FDD Items 5–7 · fees, investment, royalty
Buying in means a $49K franchise fee (Item 5) and a total investment of $95K–$151K (Item 7). The franchisor publishes an earnings claim (Item 19) — read its methodology closely.
To open (Item 7)
$95K–$151K
all-in investment range
Franchise fee (Item 5)
$49K
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 Up Closets with an independent CPADistress signals
news-sourced · bankruptcies, closures, lawsuits
Franchise litigation docket: Parmar v. Up Closets Franchising, LLC (District Court, M.D. Tennessee)
CourtListener/RECAP · 11mo ago
A broker is paid by the franchisor to place you. An independent CPA is paid by you — and the job is pressure-testing Up Closets's numbers, including talking you out of a bad deal.
Talk to an independent CPA before you buy →Up Closets franchise questions, answered from the filings
What percentage of Up Closets franchises closed last year?
In Up Closets's latest FDD Item 20 (fiscal 2025), 6 of 41 franchised outlets left the system — an annualized exit rate of 14.6%. 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 Up Closets franchise cost?
Per Up Closets's 2026 FDD, buying in requires an initial franchise fee of $49K (Item 5) and a total initial investment of $95K–$151K (Item 7).
What royalty does Up Closets charge?
Up Closets charges an ongoing royalty of 6.0% of gross sales, per Item 6 of its 2026 FDD.
Does Up Closets disclose earnings (Item 19)?
Yes — Up Closets makes a financial performance representation in Item 19 of its 2026 FDD, reporting a median unit volume of $669K. Read it closely: franchisors choose which units and which metrics to include.