Gong cha Franchise
Cost, fees, owner earnings, closure rate and litigation for a Gong cha franchise — pulled from the franchisor's own public FDD (2026), not its sales material.
Disclosure honesty
Gong cha discloses earnings (Item 19) — but the grade is how honestly. We graded it C.
What their own earnings claim actually says
Based on 222 established stores in 2025. Average Net Sales $396,887 (median $363,373). Top quartile averaged $649,521; bottom quartile $199,208. No audit verification.
What a Gong cha franchise actually costs to run
| Fee | Disclosed | Where it comes from |
|---|---|---|
| Initial franchise fee | $37,000 | Item 5 — paid up front, before you open |
| Royalty | 6% of gross sales | Item 6 — charged on revenue, not profit |
| Advertising fund | 1% of gross sales | Item 6 — brand marketing, spent at the franchisor's discretion |
| Total recurring fees | 7% of gross sales | Before rent, labor, food or debt service |
| Total initial investment | $207,450 – $648,460 | Item 7 — franchisor's own low/high estimate |
6% royalty + 1% brand marketing (up to 2%). Up to 4% total advertising obligation. Multiple ancillary fees (SaaS, training, health audits).
Royalty and ad-fund percentages are charged on gross sales — an owner pays them whether or not the location is profitable.
Gong cha system size and owner turnover
| Total outlets | 38 |
| Ceased operations | 1 |
| Terminated by franchisor | 0 |
| Transferred to new owners | 0 |
| Closure rate | 2.6% of outlets |
2025: -23 franchised/subfranchised stores; master franchisee buyouts indicate consolidation/challenges.
From Item 20 of the FDD 2026. Terminations and ceased operations are the franchisor's own count of owners who stopped — the number the sales pitch leaves out.
Is Gong cha worth it? — how it compares to 436 similar franchises
| Ongoing fees | 7% of sales | lower than most (median 8%) |
| Startup cost | from $207,450 | pricier than 64% of peers |
| Disclosure honesty | Grade C | typical for the category |
| Closure rate | 2.6% of outlets | worse than 60% of peers |
| Disclosed lawsuits | 4 | more litigious than 80% of peers |
Benchmarked against every other franchises franchise we've graded from public FDDs — the context the franchisor's pitch never gives you.
Owner take-home for a Gong cha
The franchisor's framing: Based on 222 established stores in 2025. Average Net Sales $396,887 (median $363,373). Top… We reconstruct what an owner actually keeps, from their own FDD.
- Reconstructed owner P&L — net take-home after royalty, ad fund, rent, labor & debt
- Break-even timeline + cash-on-cash ROI
- Full fee stack + required-purchase markups
- Decoded real failure / closure rate
- How it ranks vs comparable franchises
- Validation-call playbook — the exact questions to ask
See a full sample report → · 30-day guarantee
Gong cha franchise — frequently asked
- How much does a Gong cha franchise cost?
- The FDD lists a total initial investment of about $207,450–$648,460, including a $37,000 initial franchise fee.
- How much do Gong cha franchise owners make?
- Based on 222 established stores in 2025. Average Net Sales $396,887 (median $363,373). Top quartile averaged $649,521; bottom quartile $199,208. No audit verification. We grade this disclosure C for honesty.
- What are the Gong cha franchise fees?
- Gong cha's FDD discloses a $37,000 initial franchise fee, a 6% royalty on gross sales, a 1% advertising-fund contribution, for roughly 7% of gross sales in recurring fees before rent, labor, or debt service. 6% royalty + 1% brand marketing (up to 2%). Up to 4% total advertising obligation. Multiple ancillary fees (SaaS, training, health audits).
- What is the Gong cha franchise profit margin?
- Gong cha does not publish a franchisee net-profit margin — almost no franchisor does. What Item 19 actually shows: Based on 222 established stores in 2025. Average Net Sales $396,887 (median $363,373). Top quartile averaged $649,521; bottom quartile $199,208. No audit verification. Recurring fees alone take about 7% of gross sales, before rent, labor, food or debt service. Margin has to be reconstructed from the disclosure, not read off it.
- What is the Gong cha franchise failure rate?
- 2025: -23 franchised/subfranchised stores; master franchisee buyouts indicate consolidation/challenges.
- How many Gong cha locations are there?
- Gong cha's FDD reports 38 total outlets, with 1 that ceased operations in the most recent reporting year and 0 transferred to new owners. Item 20 is where system health shows up before the marketing does.
- Does Gong cha have complaints or lawsuits?
- Gong cha discloses 4 legal matters in Item 3 of its FDD. Item 3 covers the franchisor's litigation history, which is the closest thing to a public record of how it treats franchisees — read the case descriptions, not just the count.
- Is a Gong cha franchise worth it?
- It depends on the numbers, not the pitch. Gong cha scores C on disclosure honesty, carries about 7% of sales in ongoing fees, and discloses 4 legal matters. Get the real owner take-home before you sign.
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Compare Gong cha to similar franchises
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Source: MN CARDS 35583-202603-04 (Clean FDD 2026). FranchiseValidate is independent and not affiliated with Gong cha or its franchisor. Figures are extracted from the franchisor's own public disclosure document; verify against the current FDD before any decision.