Franchise SBA Default Rates: 415 Brands, Matured FY2010–2019 Cohort
SBA 7(a) loan default data, FY2010–FY2019 · Updated 2026
Franchisees defaulted on 8.8% of SBA 7(a) loans approved between FY2010 and FY2019 across the 415 franchise brands tracked here — 2,348 of 26,660 resolved loans were charged off — according to U.S. Small Business Administration data with loan statuses as of June 30, 2026. All franchised SBA borrowers defaulted at 10.2%, versus 7.8% for non-franchised borrowers. Among brands with at least 50 loans, the lowest rate is Culver's (0.0%) and the highest is Experimac (69.5%).
Most SBA default figures published online use loans approved since 2020 — loans that have had six years or less to fail — so those rates are floors, not outcomes. Every rate on this site is computed from the matured FY2010–FY2019 cohort: loans that have been paid in full or charged off, so the result is settled. Loans approved since 2020 are shown as counts so early charge-offs are visible without being mistaken for a rate.
How are franchise SBA default rates distributed across brands?
Brand-level default rates for the 329 brands with at least 20 resolved loans. The median brand defaulted on 7.4% of its loans. One brand in ten ran above 26.1%. Take a brand's rate from its own page and place it against these percentiles.
| Percentile | Brand default rate |
|---|---|
| 10th percentile | 0.0% |
| 25th percentile | 2.5% |
| 50th percentile | 7.4% |
| 75th percentile | 16.7% |
| 90th percentile | 26.1% |
| 95th percentile | 33.9% |
Source: U.S. SBA 7(a) FOIA loan data. Loans approved FY2010–FY2019, statuses as of June 30, 2026. Download this table (CSV).
- Percentiles interpolate linearly between brands, so a value need not equal any single brand's rate. 51 of the 329 brands recorded no charge-offs at all.
How many brands fall in each default-rate band?
| Default-rate band | Brands | Share of brands |
|---|---|---|
| 0% | 51 | 15.5% |
| Above 0% to 3% | 40 | 12.2% |
| Above 3% to 7% | 69 | 21.0% |
| Above 7% to 15% | 78 | 23.7% |
| Above 15% | 91 | 27.7% |
Source: U.S. SBA 7(a) FOIA loan data. Loans approved FY2010–FY2019, statuses as of June 30, 2026. Download this table (CSV).
Which 25 franchises have the highest SBA default rates?
The 25 highest brand-level rates among the 139 brands with at least 50 resolved loans. Experimac leads at 69.5% (41 of 59 loans); the 25th-ranked brand, Massage Heights, sits at 18.5%.
Source: U.S. SBA 7(a) FOIA loan data. Loans approved FY2010–FY2019, statuses as of June 30, 2026. Download this table (CSV).
Which 25 franchises have the lowest SBA default rates?
The 25 lowest rates at the same 50-loan floor. 16 of them recorded zero charge-offs; the largest of those is Culver's with 178 loans.
Source: U.S. SBA 7(a) FOIA loan data. Loans approved FY2010–FY2019, statuses as of June 30, 2026. Download this table (CSV).
How does the default rate vary by approval year?
Pooled default rate of the tracked brands' loans by the fiscal year the loan was approved. The FY2013 cohort defaulted least (6.0%) and the FY2018 cohort most (11.8%). Every year shown is fully matured. The second rate column pools every franchised SBA 7(a) loan in the country, tracked brands or not.
Source: U.S. SBA FOIA dataset, statuses as of June 30, 2026.
| Approval year | Loans | Charged off | Default rate, tracked brands | Default rate, all franchised borrowers |
|---|---|---|---|---|
| FY2010 | 1,440 | 89 | 6.2% | 8.7% |
| FY2011 | 1,629 | 100 | 6.1% | 7.6% |
| FY2012 | 1,634 | 99 | 6.1% | 7.0% |
| FY2013 | 2,118 | 128 | 6.0% | 7.0% |
| FY2014 | 3,226 | 229 | 7.1% | 8.2% |
| FY2015 | 4,031 | 346 | 8.6% | 9.9% |
| FY2016 | 3,825 | 381 | 10.0% | 10.9% |
| FY2017 | 3,330 | 388 | 11.7% | 12.9% |
| FY2018 | 3,057 | 360 | 11.8% | 13.2% |
| FY2019 | 2,370 | 228 | 9.6% | 11.1% |
Source: U.S. SBA 7(a) FOIA loan data. Loans approved FY2010–FY2019, statuses as of June 30, 2026. Download this table (CSV).
Which franchise industries have the highest SBA default rates?
Every industry with at least 5 tracked brands, lowest median brand rate first. The pooled rate weights each brand by its loan count. The median treats every brand equally. The benchmark pools all SBA 7(a) loans in the industry, franchised or not. Gasoline Stations with Convenience Stores has the lowest median (0.0%) and Residential Remodelers the highest (20.0%).
| Industry | Brands | Loans | Median brand rate | Pooled rate, tracked brands | Industry benchmark |
|---|---|---|---|---|---|
| Gasoline Stations with Convenience Stores | 13 | 590 | 0.0% | 1.7% | 3.9% |
| Child Day Care Services | 7 | 767 | 0.5% | 2.9% | 4.5% |
| Hotels (except Casino Hotels) and Motels | 29 | 2,959 | 2.0% | 2.4% | 3.0% |
| Hardware Stores | 5 | 410 | 4.8% | 5.9% | 7.6% |
| Home Health Care Services | 13 | 596 | 6.7% | 6.0% | 8.2% |
| Limited-Service Restaurants | 81 | 7,182 | 7.1% | 9.0% | 10.3% |
| Other Personal Care Services | 9 | 951 | 8.7% | 6.9% | 10.0% |
| Snack and Nonalcoholic Beverage Bars | 20 | 1,016 | 9.5% | 10.1% | 10.1% |
| Full-Service Restaurants | 12 | 445 | 10.4% | 10.6% | 9.6% |
| All Other Amusement and Recreation Industries | 7 | 257 | 11.1% | 9.7% | 9.9% |
| Janitorial Services | 10 | 401 | 11.3% | 15.0% | 11.2% |
| Beauty Salons | 15 | 1,403 | 13.8% | 8.8% | 8.6% |
| Fitness and Recreational Sports Centers | 30 | 2,284 | 15.4% | 11.6% | 11.4% |
| Residential Remodelers | 6 | 451 | 20.0% | 10.4% | 12.9% |
Source: U.S. SBA 7(a) FOIA loan data. Loans approved FY2010–FY2019, statuses as of June 30, 2026. Download this table (CSV).
Does the default rate change with loan size?
The SBA file gives each brand's average loan size rather than every loan's outcome by size, so brands with 20+ loans are grouped by their average 2010s loan. Read the pattern as brand-level, not loan-level.
| Average loan size of brand | Brands | Loans | Median brand rate | Pooled rate |
|---|---|---|---|---|
| Under $150k | 39 | 1,381 | 12.5% | 20.1% |
| $150k–$350k | 146 | 11,372 | 13.0% | 11.4% |
| $350k–$1M | 85 | 7,305 | 5.5% | 6.0% |
| $1M and over | 59 | 5,161 | 2.3% | 2.9% |
Source: U.S. SBA 7(a) FOIA loan data. Loans approved FY2010–FY2019, statuses as of June 30, 2026. Download this table (CSV).
What do loans approved since 2020 show so far?
Franchisees of the tracked brands have taken 18,206 SBA 7(a) loans since FY2020. 269 have already charged off. That is an early charge-off share of 1.5%, not a default rate, because most of these loans are still outstanding. The ten brands below have the most early charge-offs among brands with at least 30 loans since 2020.
| Rank | Brand | Early charge-offs | Loans since 2020 | Early charge-off share (not a rate) | Industry |
|---|---|---|---|---|---|
| 1 | The Grounds Guys | 20 | 162 | 12.3% | Landscaping Services |
| 2 | Mr. Appliance | 11 | 78 | 14.1% | Appliance Repair and Maintenance |
| 3 | 360 Painting | 10 | 73 | 13.7% | Painting and Wall Covering Contractors |
| 4 | Rainbow Restoration | 9 | 81 | 11.1% | Residential Remodelers |
| 5 | Aire Serv | 8 | 83 | 9.6% | Plumbing, Heating, and Air-Conditioning Contractors |
| 6 | Subway | 7 | 322 | 2.2% | Limited-Service Restaurants |
| 7 | Glass Doctor | 6 | 45 | 13.3% | Automotive Glass Replacement Shops |
| 8 | F45 Training | 5 | 149 | 3.4% | Fitness and Recreational Sports Centers |
| 9 | Mosquito Joe | 5 | 69 | 7.2% | Exterminating and Pest Control Services |
| 10 | Restoration 1 | 5 | 61 | 8.2% | Commercial and Institutional Building Construction |
Source: U.S. SBA 7(a) FOIA loan data. Loans approved FY2010–FY2019, statuses as of June 30, 2026. Download this table (CSV).
How to read this
- Minimum loans. A rate on a handful of loans is noise: at 20 loans one default moves the rate by 5 percentage points. Ranked tables therefore require 50 resolved loans and distribution statistics require 20.
- SBA-borrower skew. SBA 7(a) borrowers are typically less capitalized than all-cash buyers, so these rates can overstate risk for well-funded operators and understate nothing.
- Not unit closures. A charge-off is a lending outcome recorded by a federal agency, not a count of closed stores. Some failed units never had SBA loans; some charged-off borrowers kept operating.
- Cohort seasoning. Every rate uses loans approved FY2010–FY2019 that have since been paid in full or charged off. Loans approved since 2020 are shown as counts only, because most are still outstanding and a rate on them would be a floor.
Full definitions, benchmarks, name normalization, and limitations: methodology. Rate = loans charged off ÷ SBA 7(a) loans approved FY2010–FY2019 and since resolved (paid in full or charged off).
Need one brand's full record for a lender or an attorney? The Lender Report — $29 gives that brand's rate by approval year and by the owner's situation, when its charge-offs came, loan size and losses, its top states and lenders, its nearest peers, and the CSV behind every table, in a PDF a loan officer will recognize.
Source
Source: U.S. Small Business Administration, 7(a) loan program charge-off data, FY2010–FY2019. Franchise data is matched on the SBA's franchise code / brand name. "Failure rate" here means the share of approved loans (resolved: paid in full or charged off) that were charged off; it is not a measure of unit closures. Last updated September 30, 2026.
Cite this page
Franchise Failure Rates (2026). Franchise SBA 7(a) default rates, FY2010–FY2019 cohort: 415 brands, 8.8% pooled. Derived from U.S. SBA FOIA data, loan statuses as of June 30, 2026.
https://franchisefailurerates.com/sba-franchise-default-rates/ · Data & methodology · Download this table (CSV) · Full dataset (CSV)
Frequently asked
What is the franchise SBA loan default rate?
Across the 415 franchise brands tracked here, 8.8% of SBA 7(a) loans approved FY2010–FY2019 were charged off (2,348 of 26,660 resolved loans). Pooling every franchised SBA 7(a) borrower in the country, the rate is 10.2%, against 8.0% for all SBA borrowers and 7.8% for non-franchised borrowers.
Which franchise has the highest SBA default rate?
Among brands with at least 50 resolved loans, Experimac has the highest SBA 7(a) default rate at 69.5% (41 of 59 loans charged off). The next highest are Window Genie (58.0%) and Burgerim (38.5%).
Which franchises have 0% SBA default rates?
16 brands with at least 50 resolved loans recorded no charge-offs at all; the largest is Culver's with 178 loans. At the 20-loan floor the count rises to 51, but the smaller the sample the less a 0% means.
What is a good SBA default rate for a franchise?
The median brand with 20+ loans defaulted on 7.4% of its SBA loans, and a quarter of brands were at or below 2.5%. A rate under the brand's industry benchmark and under the 10.2% all-franchise figure is below average; a rate above 16.7% puts a brand in the worst quarter.
Why do default rates for loans since 2020 look lower?
Because that cohort is unresolved. Loans approved since FY2020 have had six years or less to fail, and most are still outstanding, so any rate computed on them can only rise. This site shows those loans as counts: 18,206 loans and 269 early charge-offs across the tracked brands.
Does a low default rate mean a franchise is safe?
No. It means that SBA-financed franchisees of that brand rarely failed badly enough for the loan to be written off during the cohort. It says nothing about profitability, about units that never took SBA loans, or about the specific territory a buyer is considering. Read it alongside the FDD's Item 19 and Item 20.
How is the default rate calculated?
Loans charged off divided by loans resolved (paid in full plus charged off), for SBA 7(a) loans approved in federal fiscal years 2010 through 2019 that carry the brand's franchise code. Cancelled and never-funded loans are excluded. The full definition, benchmarks, and limitations are on the methodology page.
How often is this data updated?
The SBA refreshes the FOIA file quarterly; this site rebuilds every page from the latest release, currently with loan statuses as of June 30, 2026. The date at the foot of each page is the last rebuild.
How this site is funded. Franchise Failure Rates takes no money from franchisors, franchise brokers, or franchise consultants. We do not sell leads, claimed listings, or franchisor reports. Revenue comes from reports and data sold to prospective franchisees, their attorneys, and lenders.