Carvel Franchise: An FDD Review and Breakdown
A year-over-year FDD review breakdown of the Carvel ice cream franchise. How many units were included in reported financial performance?
Carvel is the oldest name in American franchised ice cream: the brand dates to 1934 and franchising to 1947, and the system ended 2025 with 359 franchised Shoppes. How many units were included in reported financial performance? What kind of diligence questions should I consider?
Carvel | Food & Beverage | latest FDD 2026 | 360 outlets | franchising 79 years
Reviewer Highlights
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About the franchisor
The franchisor is Carvel Franchisor SPV LLC, a Delaware limited liability company organized on February 2, 2017 and based in Atlanta, Georgia. It has offered franchises since April 2017; its predecessor, Carvel LLC (originally Carvel Corporation, incorporated in New York in 1946), franchised the brand from 1947 to April 2017, was acquired by Roark Capital Group in 2001, and became affiliated with GoTo Foods (formerly Focus Brands) in 2004.
GoTo Foods is the indirect parent of seven franchisors, including Cinnabon, Auntie Anne's, Schlotzsky's, Moe's, Jamba, and McAlister's, and through Roark the system is also affiliated with the Inspire Brands restaurant franchisors. The direct parent, GoTo Foods Systems LLC, guarantees the franchisor's performance under franchise agreements, while GoTo Foods itself provides franchisee support and acts as franchise sales agent under a management agreement, for management fees; affiliate GoTo Supply manages procurement and GoTo Rewards administers gift cards. The Carvel trademarks are owned by the franchisor entity directly.
Brand-level leadership is largely a shared GoTo Foods bench, and the top of that bench turned over in the months around this filing. Omer Gajial became Chief Executive Officer of the franchisor and of GoTo Foods in December 2025, arriving from Albertsons, and Brett Ubl became Chief Financial Officer in February 2026 after five years at Roark Capital Management, most recently as a Principal. The development seat changed hands twice: Tom Richards, the franchise sales lead, added Interim Chief Development Officer in October 2025, and Tatiana Lambert took the role permanently in April 2026, arriving from development posts at Wendy's and Pizza Hut. The May 2026 amendment also discloses that Ama Romaine, most recently of Pretium Partners, becomes Executive Vice President and General Counsel effective June 8, 2026. At the brand level, Jim Salerno has been Chief Brand Officer since March 2022 and Jeff Edmiston has run operations since October 2022.
Growth and system health
Openings accelerated from 12 in 2023 to 15 in 2024 and 35 in 2025, while exits stayed modest: terminations ran 14, 4, and 8 across those years, with non-renewals of 0, 1, and 4 (all four 2025 non-renewals were in Connecticut, which shrank from 21 Shoppes to 16).
That puts the 2025 exit ratio at about 3.6 percent of the 336 Shoppes open at the start of the year, and cumulative closures over 2021 to 2025 at 47 against the 313 Shoppes open at the start of the window, about 15 percent over five years.
Transfers ran 16, 18, and 10 over 2023 to 2025, most of them in New York. The geography is the striking part: 207 of 359 franchised Shoppes are in New York and another 66 are in New Jersey and Connecticut, while the growth bet points west, with 28 of the 132 signed-but-unopened agreements in California against just 6 open Shoppes there today.
The backlog itself is worth watching: the prior filing showed 143 signed agreements and projected 38 openings for 2025, and 35 actually opened; this filing carries 132 signed and projects 25.
| Year | Opened | Terminations | Non-renewals | Reacquired | Ceased | Outlets (end) |
|---|---|---|---|---|---|---|
| 2021 | 20 | 6 | 0 | 0 | 0 | 327 |
| 2022 | 11 | 10 | 0 | 0 | 0 | 328 |
| 2023 | 12 | 14 | 0 | 0 | 0 | 326 |
| 2024 | 15 | 4 | 1 | 0 | 0 | 336 |
| 2025 | 35 | 8 | 4 | 0 | 0 | 359 |
Transfers of existing Shoppes to new owners ran 16 in 2023, 18 in 2024, and 10 in 2025. New York accounts for most of them (10, 14, and 7), which tracks the system's footprint. A Control Transfer costs 50 percent of the then-current Initial Franchise Fee, and the 2026 FDD added that you and your guarantors must sign a general release and remain liable for pre-transfer obligations.
The system is effectively 100 percent franchised. Item 20 shows zero company-owned Shoppes until a single affiliate-owned Shoppe in Georgia appears at the end of 2025, so the franchisor family operates one Shoppe on the playbook it sells, against 359 franchised.
As of December 31, 2025, 132 franchise agreements were signed but not yet open, led by New York (32), California (28), and Texas (15), with 25 new franchised Shoppes projected for 2026. The prior filing showed 143 signed and 38 projected; actual 2025 openings were 35. The FDD does not reconcile how many signed agreements were terminated before opening.
What it costs to get in
A single-branded streetside Full Shoppe, the format Item 19 reports on, runs $428,405 to $1,051,200 under the 2026 FDD, with construction and build-out ($136,400 to $450,500) and the equipment package ($134,000 to $225,000, including two soft-serve machines and a freezer) doing most of the work.
The FDD discloses five formats in all, from a Hosted Express Shoppe at $38,850 to $100,500 up to a Cinnabon Co-Branded Shoppe at $463,250 to $1,136,500, so matching the right table to the deal you are actually offered matters. Against the 2025 FDD, the Full Shoppe high rose $265,350 (33.8 percent, from $785,850), driven by construction ($318,000 to $450,500 at the high), a millwork line added at $20,000 to $40,000, exterior signage ($13,500 to $40,800 at the high), and architect and engineering fees roughly doubling. The Initial Franchise Fee rose $5,000 to $35,500. The franchisor offers no financing (Item 10).
| Category | 2025 FDD | 2026 FDD |
|---|---|---|
| Initial Franchise Fee | $30,500 | $35,500 |
| Construction and Build Out Costs | $128,600 to $318,000 | $136,400 to $450,500 |
| Permitting | $550 to $4,100 | $550 to $8,000 |
| Equipment Package | $134,000 to $208,000 | $134,000 to $225,000 |
| Millwork | - | $20,000 to $40,000 |
| Furniture | $3,800 to $4,300 | $3,800 to $4,300 |
| Menu Board, Graphics and Interior Signage | $10,200 to $8,450 (as printed) | $6,100 to $21,600 |
| Exterior Signage | $5,400 to $13,500 | $5,400 to $40,800 |
| Computer System | $10,500 to $32,000 | $10,500 to $32,000 |
| Smallwares | $7,800 to $12,000 | $7,800 to $18,000 |
| TV/Music | $1,100 to $4,300 | $1,100 to $4,300 |
| Architect/Engineer | $5,400 to $18,000 | $12,730 to $33,100 |
| Rent (one month) | $2,000 to $7,500 | $2,000 to $10,000 |
| Grand Opening Marketing | $3,000 to $7,500 | $3,000 to $7,500 |
| Legal and Accounting Fees | $5,000 to $10,000 | $5,000 to $10,000 |
| Insurance | $1,125 to $6,300 | $1,125 to $6,300 |
| Misc. Opening Costs/Office Supplies | $1,800 to $6,800 | $1,800 to $6,800 |
| Security Deposits | $0 to $15,000 | $0 to $15,000 |
| Management Training Program Fee | $0 to $3,000 | $0 to $3,000 |
| Travel and Living Expenses during Training | $4,100 to $6,300 | $4,100 to $6,300 |
| On-Site Training Fee | $0 to $5,300 | $0 to $6,500 |
| Opening Inventory | $5,000 to $15,000 | $5,000 to $16,700 |
| Additional Funds - 3 Months | $32,500 to $50,000 | $32,500 to $50,000 |
| TOTAL | $392,375 to $785,850 | $428,405 to $1,051,200 |
Ongoing fees
The required percentages stack to about 11 percent of Net Sales: a 6 percent royalty, 3 percent to the Ad Fund, and at least 2 percent spent locally each quarter, before any Advertising Cooperative dues, the $250 monthly point-of-purchase charge, POS fees, or the 3 percent online ordering fee. All of it runs on Net Sales, not profit, so the franchisor is paid on every dollar through the register even in a money-losing month, and delivery orders are charged on the full menu price before the delivery platform takes its cut.
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One more number worth holding next to the $35,500 sticker fee: Item 5 discloses that franchisees who signed during calendar 2025 actually paid Initial Franchise Fees of $0 to $12,500, so the list price and the street price are not the same thing.
| Fee | Amount |
|---|---|
| Initial franchise fee | $36k |
| Royalty | 6.0% of Net Sales |
| Brand / ad fund | 3.0% of Net Sales |
| Royalty Fee | 6 percent of Net Sales, payable weekly. Net Sales counts the full menu price on delivery and catering orders, including fees paid by services like DoorDash or Uber Eats, before their commission is deducted. |
| Advertising Contribution | 3 percent of Net Sales to the Ad Fund (2.5 percent for Cinnabon Co-Branded Shoppes in Other Locations; not charged to Hosted Express Shoppes). The franchisor may raise it at any time, capped so that the Advertising Contribution plus the Local Marketing Obligation never exceed 5 percent of Net Sales combined. |
| Local Marketing Obligation | Currently at least 2 percent of Net Sales each calendar quarter spent on local advertising (1 percent for Ice Cream Trucks and Co-Branded Shoppes), changeable on 60 days' notice within the combined 5 percent cap. |
| Advertising Cooperative Contribution | An additional amount set by your regional Advertising Cooperative where one exists, decided by member vote. |
| Promotions and point-of-purchase materials | Currently $250 per month for point-of-purchase materials, plus the cost of required promotional campaigns, at up to 110 percent of the franchisor's or its affiliates' actual costs. |
| POS System fees | POS System Support Fee of $70 to $250 per month, plus either the CapEx purchase path (software license $159 to $397 per month) or the Hardware as a Service path (initial payment of $302 to $967 plus a $300 activation fee); the HaaS upfront range increased in this filing. |
| Ordering Support Fee | Currently 3 percent of the pre-tax amount of each transaction processed through the online ordering system, on top of the royalty and advertising percentages. |
| Technology Fee | Reserved but not currently collected; may be set later as a percentage of Net Sales, fixed fees, or usage fees. |
| Gift Card and Loyalty Programs | Mandatory participation, with administrative fees charged by the franchisor, its affiliates, or designated vendors. |
| Transfer Fee | 50 percent of the then-current Initial Franchise Fee for a Control Transfer; 10 percent for related-party or non-control transfers. |
| Renewal Fee | 20 percent of the then-current Initial Franchise Fee, paid before the renewal term. |
| Relocation Fee | 10 percent of the then-current Initial Franchise Fee, plus $1,500 per year if the term is extended to match a new lease. |
| Refresh and remodel | A refresh is required every five years and a remodel every ten, with a site survey and design fee of $1,200 to $6,000, plus the construction itself. |
| Late and default charges | Late Reporting Fee of $50 per week, interest at up to 1.5 percent per month on past-due amounts, and a Reinstatement Fee of 10 percent of the then-current Initial Franchise Fee plus royalties accrued between termination and reinstatement after a cured health-and-safety termination. |
Reported financial performance (Item 19)
Item 19 covers one slice of the system: single-branded Full Shoppes in streetside locations that used the designated POS System and reported sales in all 52 weeks of FY2025. That is 104 of the 272 streetside Shoppes (38.2 percent), and only 29 percent of the 359 franchised Shoppes overall;
Express, co-branded, and other-location formats get no figures at all, and 125 streetside Shoppes that were on the POS System still did not report a full 52 weeks (the franchisor has not required existing franchisees to adopt its POS, and 25 more were not on it at all).
For the 104 that qualified, FY2025 average Net Sales were $496,287 and the median was $469,711, with quartile averages running from $248,690 at the bottom to $779,624 at the top and a full range of $83,828 to $1,458,901, about 17 times bottom to top; 47 of 104 Shoppes (45 percent) met or exceeded the average. Across filings the trend is directional rather than same-store, because the reporting cohort is rebuilt each year (83 Shoppes for FY2023, then 104 and 104): the disclosed median has fallen two filings in a row, from $505,958 (FY2023) to $480,774 (FY2024) to $469,711 (FY2025), while the average dipped 7.7 percent and then recovered 2.5 percent to $496,287.
These are revenue figures only; the FDD discloses no cost or profit data for any Shoppe, so nothing in Item 19 says what an owner takes home.
| Annual Net Sales, Eligible Streetside Franchises (average by cohort) | 2023 | 2024 | 2025 | Latest YoY |
|---|---|---|---|---|
| Top quartile average | $820K | $785K | $780K | -0.7% |
| All-Shoppe average | $524K | $484K | $496K | +2.5% |
| All-Shoppe median | $506K | $481K | $470K | -2.3% |
| Bottom quartile average | $245K | $189K | $249K | +31.3% |
Personal risk and the exit
A Full Shoppe is a 20-year commitment with one 20-year renewal (Express formats and trucks run 5 years, and a truck renewal is at the franchisor's sole discretion); renewing means signing the then-current agreement, which may be materially different, paying 20 percent of the then-current Initial Franchise Fee, and signing a general release.
The Item 17 table gives you no right to terminate except as state law allows, and Item 6 prices an early exit: liquidated damages equal to your average monthly Royalty Fee over the prior 36 months times the lesser of the remaining term or 36 months, due within 30 days of termination — roughly $89,000 at the FY2025 average Net Sales. Section 18.3 of the Franchise Agreement (Exhibit B) has the full mechanics.
The in-term non-compete bars involvement in any similar business anywhere, and the post-term covenant doubled in this filing from 12 to 24 months, covering your former location, 3 miles around it, and 3 miles around any Carvel Shoppe.
Most disputes go to arbitration in the metropolitan area of the franchisor's principal place of business, currently Atlanta, under Georgia law (non-competes follow your Shoppe's state law).
Item 12 was also clarified this year to state that most Shoppes receive no protected territory.
Litigation
The 2026 FDD discloses two pending matters involving the Carvel system directly, both tied to one former franchisee. Carvel Franchisor SPV, LLC v. Oluf Inc. and Stephen Oluf Winick (N.D. Ga., filed April 3, 2025) is a franchisor-initiated suit alleging the former franchisee kept operating a Shoppe after termination; the court granted a preliminary injunction in part in July 2025, the defendants filed counterclaims for breach and recoupment, and the franchisor's motions to dismiss those counterclaims and for contempt were pending when the FDD issued, with a default entered against the entity in January 2026.
In the mirror action, Oluf Inc. v. Carvel Corporation (Los Angeles Superior Court, filed April 1, 2025), the former franchisee petitions to compel arbitration over alleged misrepresentations and breach; it also remains pending.
The FDD then discloses four resolved affiliate matters that it states do not involve Carvel: the 2019 Arby's and Dunkin' no-poach settlements with state attorneys general, the 2020 Dunkin' consent order with the New York Attorney General over credential-stuffing attacks ($650,000 plus a security program through September 2026), and a June 2025 Maryland consent order in which affiliate Jimmy John's paid $30,000 over omitted former-franchisee contact information in an FDD filing.
Item 4 discloses no bankruptcies.
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Changes since the prior FDD
Changes between the 2025 and 2026 FDDs worth noting:
- (1) the Full Shoppe Initial Franchise Fee rose from $30,500 to $35,500, and the Cinnabon Co-Branded fee from $61,000 to $71,000;
- (2) the Full Shoppe investment total rose from $392,375 to $785,850 to $428,405 to $1,051,200, with a millwork line added and construction, signage, and architect highs up; the Ice Cream Truck total also rose to $126,975 to $327,550;
- (3) the post-term non-compete doubled from 12 to 24 months;
- (4) transfer conditions now require a general release and continuing liability for pre-transfer obligations;
- (5) Item 12 was clarified to state that most Shoppes receive no protected territory;
- (6) Item 15 added explicit day-to-day participation obligations;
- (7) training provisions now let the franchisor require repeat training and additional trainees;
- (8) the Hardware as a Service POS upfront payment range increased from $216–$442 to $302–$967 (the $300 activation fee is unchanged);
- (9) the Oluf litigation entered Item 3, the first Carvel-specific matter in recent filings;
Understand the disclosures
Related FDD items
Questions worth asking
What does the Carvel name pull outside the Northeast? The brand is 92 years old, but 76 percent of Shoppes sit in New York, New Jersey, and Connecticut, and Item 19 gives you no geographic breakouts. If you are one of the 28 signed agreements in California, you are paying Northeast-brand fees in a market with 6 open Shoppes, so ask operating franchisees outside the core states what the name is worth on their street.
How would your Shoppe land in a $83,828-to-$1,458,901 range? Only 104 of 359 franchised Shoppes appear in Item 19, the median has slipped two filings in a row, and 125 Shoppes on the franchisor's own POS system still did not report a full year. Ask the franchisor why coverage is that thin, and ask franchisees in each quartile what separates a $250,000 Shoppe from a $780,000 one.
What does leaving early actually cost? The Full Shoppe term is 20 years with no franchisee termination right, Item 6's liquidated damages formula runs to 36 months of royalties (about $89,000 at the system average, more at a strong Shoppe), and the post-term non-compete just doubled to 24 months within 3 miles of any Shoppe. Have a franchise attorney price the exit from the Franchise Agreement (Exhibit B) before you price the entry.
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