Verified — real FDD extraction
Not found in the SBA Franchise Directory under this name — though SBA loans to its franchisees exist; verify eligibility with your lender
BEARD PAPA'S
Other · independent · est. —
Beard Papa's is a Japanese-origin bakery brand specializing in fresh cream puffs filled to order, plus related pastries and drinks. A franchisee operates a compact bakery counter, often in a mall or urban retail location, with staff baking shells and filling puffs throughout the day.
BEARD PAPA'S net unit count declined -10.0% from 2023–2025 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
Showing strain
Distress
The disclosed record shows weakness — shrinking units, elevated exits, or churn — worth reading closely before going further.
Exit rate · latest year
21.4%
fiscal 2025, per Item 20
Cost to open
$201K–$477K
Item 7 total investment range
SBA loan defaults
Too few resolved
5 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
2023–2025
Survival record
FDD Item 20 · outlet status by year
In fiscal 2025, 9 of 42 franchised outlets left the system — a 21.4% annualized exit rate. Not every exit is a failure — but this is the measurable floor.
Show the outlet tables ↓Hide the evidence ↑
| Status (FTC) | 2023 | 2024 | 2025 |
|---|---|---|---|
| Outlets at start | 39 | 40 | 43 |
| Opened | 7 | 4 | 1 |
| Transfers | 3 | 3 | 2 |
| Terminations | 0 | 0 | 8 |
| Non-renewals | 0 | 0 | 0 |
| Reacquired by franchisor | 0 | 0 | 0 |
| Ceased — other reasons | 6 | 2 | 1 |
| Outlets at end | 40 | 43 | 36 |
| Net change | +1 | +3 | -7 |
The lender's view
SBA 7(a)/504 loan performance · FY1991–present
Banks have made 5 SBA-backed loans to BEARD PAPA'S franchisees since 2006. Most are still open, so there is not yet a resolved cohort large enough to rate.
—
3 resolved · too thin to rate
—
avg. charged-off $ ÷ approved $
—
default rate × loss severity
$227,900
what recent franchisees borrowed
30 mo
approval → charge-off, defaulted loans
1 vs 1
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 BEARD PAPA'S 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 $45K franchise fee (Item 5) and a total investment of $201K–$477K (Item 7). The franchisor publishes no earnings claim (Item 19) — ask current and former franchisees for real numbers.
To open (Item 7)
$201K–$477K
all-in investment range
Franchise fee (Item 5)
$45K
upfront, one-time
Royalty (Item 6)
5%
of sales, ongoing
Your figure — this brand discloses no Item 19 earnings; validate with current & former owners.
Royalty you'd pay / yr
$50K
5% of sales, before profit
Over a 10-yr term
$500K
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 BEARD PAPA'S 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 $0 in back wages for 0 workers. 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
$0
Employees affected
0
Since 2020
1
Read this carefully. The employers in these cases are individual BEARD PAPA'S franchisees — separately owned businesses operating under the brand name — not BEARD PAPA'S 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 2025.
Modeled risk
FDD Risk Score · modeled from the public record
The public record puts this brand toward the riskier end of the systems we score — but the evidence is thin, so treat it as a range, not a number.
Risk percentile (range)
79–100 / 100
Directional
Modeled SBA charge-off
21.2%
Observed SBA charge-off
no resolved cohort
Top drivers: System size (log units) (raises) · Item 20 exit rate (raises) · Net unit growth (raises) · Item 3 litigation (log) (raises). Thin loan history — treat this as a range, not a number. A linear scorecard built from this brand's own disclosure figures plus the federal loan record behind its franchisees; full spec and cross-validated accuracy on the methodology page. A score is context, not a verdict.
Distress signals
news-sourced · bankruptcies, closures, lawsuits
No recent closures, bankruptcies, or major lawsuits found in the news for BEARD PAPA'S. That's a good sign — but it reflects news coverage, not a guarantee.
A broker is paid by the franchisor to place you. An independent CPA is paid by you — and the job is pressure-testing BEARD PAPA'S's numbers, including talking you out of a bad deal.
Talk to an independent CPA before you buy →BEARD PAPA'S franchise questions, answered from the filings
What percentage of BEARD PAPA'S franchises closed last year?
In BEARD PAPA'S's latest FDD Item 20 (fiscal 2025), 9 of 42 franchised outlets left the system — an annualized exit rate of 21.4%. 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 BEARD PAPA'S franchise cost?
Per BEARD PAPA'S's 2026 FDD, buying in requires an initial franchise fee of $45K (Item 5) and a total initial investment of $201K–$477K (Item 7).
What royalty does BEARD PAPA'S charge?
BEARD PAPA'S charges an ongoing royalty of 5.0% of gross sales, per Item 6 of its 2026 FDD.
Does BEARD PAPA'S disclose earnings (Item 19)?
No — BEARD PAPA'S's 2026 FDD makes no financial performance representation in Item 19. That is legal and common, but it means the franchisor publishes no earnings claim; ask current franchisees for real numbers.