Over the past week, we analyzed the 2025 Franchise Disclosure Documents for ten of the most-searched franchise brands in America. McDonald's, Subway, Dunkin', Chick-fil-A, Culver's, Planet Fitness, Anytime Fitness, Orangetheory Fitness, Great Clips, and Servpro.
Every claim in this piece cites the 2025 FDD filings, Franchise Times industry reporting, Planet Fitness's 2025 Form 10-K public filings, federal court filings for the Honors Holdings bankruptcy, and state registry filings we could verify publicly. No speculation. No anecdotes. Just what the actual filings disclose.
Here is what we found, brand by brand.
1. McDonald's raised its royalty rate for the first time in 30 years
The headline finding in the 2025 McDonald's FDD: new franchise agreements signed starting in 2024 now carry a 5% royalty rate rather than the 4% rate that had been in place for approximately three decades. Existing franchise agreements retain the 4% rate through their existing term, but upon renewal, franchisees transition to 5%. On an average unit volume of $4 million, a one-point royalty change equals $40,000 per year per restaurant. For a franchisee operating five McDonald's locations, that is $200,000 per year flowing from franchisee to franchisor after the change takes effect.
McDonald's also added +102 net U.S. units in 2024, the largest net positive year for domestic unit growth since 2013. The system is not struggling. The royalty raise reflects pricing power, not distress.
2. Subway lost 631 net U.S. locations in 2024. That's nine consecutive years of net decline.
The 2025 Subway FDD reports 631 net U.S. store closures during 2024, continuing a streak of nine consecutive years of net negative domestic unit growth. Subway does not provide an Item 19 financial performance representation in its FDD, which means prospective franchisees cannot reference a franchisor-substantiated average unit volume when modeling unit economics. Third-party databases cluster around $490,000 AUV, but Subway itself has made no such representation.
The combined fee load on a Subway franchise is 12.5% of gross sales, among the highest in QSR. Nine years of net decline plus no Item 19 plus 12.5% ongoing fees is a difficult combination to underwrite.
3. Chick-fil-A's $10,000 fee buys you a job, not a business
The Chick-fil-A Operator Program is not a conventional franchise. For a $10,000 initial fee, the Operator does not own the restaurant, the real estate, the equipment, or the brand. Chick-fil-A owns all of it. The Operator takes a 15% royalty out of gross sales plus approximately 50% of net profits, and operates under a year-to-year license rather than a multi-year franchise agreement.
Acceptance rate into the Operator Program is approximately 0.3%, or roughly one in 330 applicants. The Operator has no equity to sell and no transferable license. Chick-fil-A's October 2024 acquisition of Truett's Group added new operational complexity for existing Operators. If your model of franchise ownership is building an asset to sell in 20 years, the Chick-fil-A Operator Program is the wrong vehicle.
4. Dunkin's Item 19 excludes nearly 1,000 disrupted units from the reported averages
The 2025 Dunkin' FDD reports average sales figures for franchised Dunkin' locations, but the sample explicitly excludes 956 "disrupted" units, out of a total of 8,465 in the initial set. That is approximately 11% of the U.S. Dunkin' system excluded from the Item 19 average because the franchisor classified them as disrupted by remodels, relocations, or other structural changes.
Dunkin' also charges a weekly, not monthly, royalty of 5.9% plus a 5% brand fund contribution, plus additional local marketing requirements. The combined weekly fee burden reaches approximately 10.9% of gross sales. And Dunkin's franchise agreements do not grant territorial protection, meaning the franchisor can place a new Dunkin' across the street from yours without requiring your consent.
5. Culver's is elite, but the payback is 12 years
The 2025 Culver's FDD reports an average unit volume of approximately $3,694,000, the sixth-highest AUV among the top 50 U.S. quick-service restaurants. The 4% royalty is meaningfully below the QSR norm. Only 3 permanent closures in 37 years of franchising. Strong fundamentals.
And yet: initial investment is $2,642,500 to $8,573,000, with a 20% cash reserve requirement adding another $562,000 to $1,370,000. Payback period on the investment is 11.7 to 13.7 years even at the elite AUV. Culver's is a great franchise for someone underwriting a 15-year hold with institutional-grade capital. It is not a great franchise for someone hoping to retire in ten years.
6. Planet Fitness requires a $3 million net worth and an NDA before substantive discussion
The 2025 Planet Fitness FDD sets a $3,000,000 minimum net worth and $1,500,000 minimum liquid assets requirement for prospective franchisees. Most new development happens through Area Development Agreements for 5 to 10 units. The system has consolidated heavily toward private-equity-backed multi-unit operators; the largest franchisees (National Fitness Partners, Taymax, Excel, Grand Fitness, Baseline) combined operate approximately 550 of the system's 2,896 clubs.
Additionally, Planet Fitness requires every prospective franchisee to sign a Nondisclosure and Non-Use Agreement before engaging in substantive discussions about the opportunity. This is not a post-application term sheet. It is required before the franchisor will even discuss specifics. As a public company trading on NYSE as PLNT, Planet Fitness also operates under quarterly earnings pressure that flows through to franchisees as capital-expenditure requirements, such as the current strength-equipment rollout affecting roughly 80% of clubs.
7. Anytime Fitness charges $3,000 per month in fixed fees regardless of revenue
Most franchise royalty structures scale with sales. The Anytime Fitness 2025 FDD charges fixed monthly fees: $820 royalty plus $600 marketing plus $799 technology plus $149 Coaching Suite plus $600 to $1,000 local marketing. Total fixed monthly recurring fees run approximately $2,968 to $3,368 per center, or $35,600 to $40,400 per year, payable regardless of whether the center generates any revenue.
The Item 19 sample covers 1,656 franchised centers. Revenue ranges from $86,175 at the low end to $1,835,348 at the high end, a 20-to-1 spread within the same brand. First-quartile median revenue is approximately $239,000. At that revenue level, fixed fees alone consume 15% of gross. At the Item 19 low of $86,175, fixed fees exceed 40% of revenue. The franchisor also reserves the right to convert the $820 fixed royalty to "up to 8% of Gross Revenue" at its own discretion, which would increase the royalty nearly 4x on an average-performance unit.
8. Orangetheory's largest franchisee entered Chapter 7 bankruptcy in late 2024
This is the most severe finding in the set. The 2025 Orangetheory FDD was filed in the middle of a system crisis. Honors Holdings, formerly the largest Orangetheory franchisee at 143 studios (approximately 11% of the entire global system), was the subject of an involuntary Chapter 7 bankruptcy petition filed November 20, 2024.
Court filings disclose that Honors defaulted on a credit facility with WhiteHorse Finance totaling more than $100 million. Two other Orangetheory franchisees are listed as creditors, seeking a combined $8.79 million owed from studio-sale earn-out payments Honors stopped making. A landlord entity claims an additional $4.4 million. WhiteHorse took a $5 million write-down on the Honors investment. Its subsidiary Camarillo Fitness Holdings acquired 121 of the 143 Honors studios; the remaining 22 are in wind-down.
When a PE-backed multi-unit operator with $100 million in lending cannot make the unit economics work, prospective single-studio franchisees should take the data point seriously. This is in addition to a 10% combined fee burden (8% royalty plus 2% ad fund, the highest combined rate among the ten brands we analyzed), and an April 2024 parent-company merger forming Purpose Brands that is still integrating. The franchisee-led Team Orange Independent Franchise Council formed specifically to negotiate with Purpose Brands leadership about membership growth concerns.
9. More than half of Great Clips salons don't report to Item 19
The 2025 Great Clips FDD earns partial transparency credit: the franchisor openly discloses that of 4,171 salons eligible to be open for the full 2023 calendar year, only 2,014 ("Reporting 2023 Salons") provided sufficient data for inclusion in the Average Operating Cash Flow Statement. The remaining 2,157 Non-Reporting salons were excluded. That is 52% of eligible salons not included in the published averages.
Great Clips itself discloses that if the Non-Reporting salons had been included, median total sales across the sample would have decreased by 4.7% and net operating cash flow would have decreased by a larger percent. The bias direction is disclosed. But the point is that the published median revenue of $382,000 reflects the 48% of operators willing and able to report, not the full system. Great Clips is also structurally a multi-unit franchise: 4,439 salons across roughly 700 franchisees averages 6.3 salons per owner.
10. Servpro does not provide an Item 19, and the royalty scale charges small operators the most
The 2025 Servpro FDD does not include a financial performance representation. Servpro's own franchise development materials state: "Due to the maturity and diversity of the SERVPRO brand, financial performance representation is not provided in Item 19 of the franchise disclosure document." This, from a franchisor with 58 years of operating history, 2,300+ units, and Blackstone capital backing since 2019. The Blackstone majority stake adds private-equity exit-timeline incentives to the corporate governance structure.
Servpro's royalty is a sliding scale from 3% to 10% of gross sales, with the percentage decreasing as sales volume increases. New franchisees and smaller operations pay the highest royalty rate. Larger, more established operators work their way down to 3%. The structure rewards endurance and scale, and penalizes new entrants during the years that are statistically the hardest to survive.
Three patterns that show up across multiple brands
Pattern 1: Item 19 sample selection. Brands exclude subsets of their systems from the Item 19 average in ways that make the remaining sample look better than the full system. Dunkin' excludes 956 "disrupted" units. Great Clips excludes 52% of eligible salons that don't report. Anytime Fitness excludes 29 permanently closed centers. Subway, Chick-fil-A, and Servpro provide no Item 19 at all. The reported averages are consistently better than the underlying data would suggest.
Pattern 2: Combined fee loads well above the advertised royalty. McDonald's advertised royalty is 5%, but the actual fee structure including marketing and rent creates a total burden that approaches 12%. Dunkin's 5.9% royalty becomes 10.9% when you add the brand fund. Anytime Fitness charges fixed monthly fees that at low revenue levels exceed 40% of gross. The advertised royalty rate is almost never the actual fee burden.
Pattern 3: Franchisee distress signals are lagging indicators. Honors Holdings's Chapter 7 petition came after a year of cash-flow problems that were visible internally but not disclosed in the 2024 FDD. Subway's nine consecutive years of net decline were only visible retrospectively. The best time to evaluate a franchise system's health is before the FDD that discloses the distress gets filed. That means reading prior years' FDDs, reading federal court filings, and calling existing and former franchisees before signing.
What to do with this
If you are considering any of these ten brands, the corresponding analysis pages on our directory cover the full Item 5, 6, 19, and 20 findings, along with three distinctive red flags per brand and a verdict on who the concept actually fits.
If you are considering a different brand, our AI FDD Analyzer applies the same analysis framework to any franchise you upload. $197 for a full FDD review. For deeper due diligence, our $997 Expert Review adds direct franchisee reference calls and a written investment recommendation.
The 2025 FDDs for these ten brands will be replaced by their 2026 filings between April 20 and April 30, 2026. We will update each brand page within a week of the new filing. The patterns that surface in the 2026 disclosures, particularly around Item 19 sample selection, royalty structures, and unit-count direction, will tell us a lot about where the U.S. franchise system is heading.