Batteries Plus 2026 FDD: Viable at Top-Half Performance, Marginal at Median, Value-Destructive at Bottom Quartile
Reconstructed owner P&L — At median franchised same-store net revenue of $833,660 disclosed in Item 19 Table A-2 (490 franchised same stores, FY2025). All percentages are % of this revenue base unless noted.
| Revenue | $833,660 | 100% |
| Cost of Goods Sold | $408,493 | 49% |
| Gross Profit | $425,067 | 51% |
| Labor (Wages & Comp) | $165,699 | 19.9% |
| Occupancy / Rent | $81,000 | 9.7% |
| Royalty (5% of Net Revenue) | $41,683 | 5% |
| National Marketing Fee (1% of Net Revenue) | $8,337 | 1% |
| Digital Marketing / Ad Fund (up to 4% of Net Revenue, floored at $20K) | $33,346 | 4% |
| Other Operating Expenses (Selling, Delivery, Admin, Tech Fees, Insurance, Misc) | $19,169 | 2.3% |
| Operating Profit (EBITDA proxy, before debt service and owner draw) | $75,873 | 9.1% |
| Debt Service (SBA 10-yr loan, 10.5% on 70% of midpoint investment) | $28,700 | 3.4% |
| Debt Service (SBA 10-yr, 10.5%, 70% of $410,711 midpoint = $287,498) | $46,548 | 5.6% |
| Owner Net (Operating Profit minus Debt Service, before owner draw and income tax) | $29,325 | 3.5% |
Owner net at different sales volumes
Assumptions: COGS at 49% of revenue (inverse of 51% blended merchandise margin, Item 19 Section I-A); margin excludes inventory shrinkage and scrap per Item 19 Note B, so true COGS is modestly higher.; Owner-operator actively manages store and draws NO separate salary from the P&L per Item 19 Note D convention; any owner compensation would be drawn from the $29,325 owner net, reducing it dollar-for-dollar.; SBA loan: 70% of midpoint investment ($287,498) at 10.5% over 10 years; equity injection $123,213 plus $100,000 minimum liquid reserve per Item 7 Note 19 requires total cash of approximately $223,000 at signing—a significant personal capital requirement.
Can you afford it? Run your own numbers
Enter your situation — this recomputes Batteries Plus' economics for you, live.
Estimate only — uses the report's 9.1% operating margin and your inputs. Not financial advice.
How buyers actually pay for it
Total investment for Batteries Plus: $284,786–$536,636. The common ways to fund it:
- SBA 7(a) loan — the default path. Up to ~90% financed, 10-yr term, ~10–11%. On the midpoint that's roughly $82,142 down + a $328,569 loan. Lenders want ~680+ credit, some relevant experience, and the FDD.
- 401(k)/IRA rollover (ROBS) — put retirement funds in tax- & penalty-free as equity, no debt — but you're risking your retirement. Set up via a ROBS provider (~$5k + monthly fee).
- HELOC — cheapest money if you have home equity; you're putting your house up as collateral.
- Franchisor financing — check FDD Item 10; some brands defer fees or have a lender partner.
- Unsecured business lines — fast and smaller, higher rate; usually a top-up, not the base.
Informational, not financial advice — talk to an SBA-preferred lender. Most franchises sit on the SBA Franchise Directory, which speeds approval.
The full fee stack
| Initial Franchise Fee Item 5; fully non-refundable at signing; single largest sunk cost before a single dollar of revenue. | $49,500 (single unit); $39,500 veterans/qualifying discount available |
| Royalty & Service Fee Item 6; no cap; payable on all product and service sales; compounds against thin margins. | 5% of Net Revenue monthly |
| National Marketing Fee Item 6; separate from Digital Co-op; franchisor controls 100% of NMF spend allocation. | 1% of Net Revenue monthly |
| Digital Marketing Contribution (Digital Co-op Fund) Item 6 Note 6 and Item 11; combined with NMF = 5% marketing load minimum; franchisor controls spend with no pro-rata local benefit guarantee. | Greater of 4% of Net Revenue or $20,000/yr minimum |
| Retail Management System + Tech Stack Items 5, 6, 7, 11; mandatory single-source procurement (TRG for hardware, franchisor for software); fees can increase up to 10%/yr per Item 6. | $43,986 upfront + $10,000 Omni-Channel + $1,038/mo ongoing ($12,456/yr) |
| Transfer Fee + Renewal Fee Item 6 and Item 17; renewal requires signing a materially different agreement and a general release of all claims—franchisee surrenders all accrued legal rights at renewal. | Transfer: 50% of then-current IFF (~$24,750); Renewal: 20% of then-current IFF (~$9,900) plus remodel plus sign new agreement |
| New Store Commercial Support (mandatory year 1) Item 6 Note 13; mandatory for all new franchisees first 12 months; not discretionary. | $1,150/mo for months 4–12 (~$10,350 net of 3 free months) |
| Minimum Store Promotion Requirement Item 6 Note 6 and Item 11; $20,000 due in cash at store opening, applied to Digital Co-op; creates immediate pre-revenue cash drain. | $20,000 prepaid at opening, then greater of 4% Net Revenue or $20,000/yr |
Red-flag clauses to negotiate — or walk from
Real failure & turnover
Item 20 Table 3 shows franchised store count declining from 609 (start 2023) to 601 (end 2025)—a net loss of 8 units over 3 years. Terminations: 2+1+1=4. Non-renewals: 3+1+1=5. Reacquired by franchisor: 0+4+11(Oregon alone)+others=~20+. Ceased operations/other: 2+3+2+6(Georgia)+3(Nevada)+4(Alabama)=~35+ over 3 years. Combined franchisor reacquisitions + cessations = ~55 involuntary exits on ~600-unit base = ~3% annual involuntary attrition, above the ~1.5% healthy franchise norm. Oregon's 11 reacquisitions in 2024 alone suggests a regional distress event, not random attrition.
Litigation read
Item 3 reveals one active collection suit (Osmond Industries, 2025) and a settled franchisee fraud/misrepresentation claim (Singh, California) where Batteries Plus paid $590,000 to resolve allegations of breach of franchise agreement and California Franchise Investment Law violations. A $590K settlement is material and suggests the franchisor faced real litigation risk on disclosure and support claims—not a nuisance suit.
How Batteries Plus compares (same category)
| Brand | Grade | Fees | Invest from |
|---|---|---|---|
| 7-Eleven, Inc | C | 46% | $162,900 |
| Five Star Flooring | F | — | — |
| AlphaGraphics | B | 7.5% | $53,457 |
| BoxDrop | F | 3% | $67,000 |
| BNI | A | 20% | $53,410 |
| Generator Supercenter | C | 4% | $504,950 |
Better-value alternatives near this budget
Franchises with similar-or-lower investment and a more honest earnings disclosure or lower fee load:
| Brand | Grade | Fees | Invest from |
|---|---|---|---|
| Office Pride | N/A | 10% | $71,000 |
| Firehouse Subs® Restaurant | N/A | 11% | $405,350 |
| Kid to Kid | A | 5.5% | $357,515 |
| Naz's Halal Food | A | 8% | $322,800 |
| Terri Sniegolski | A | 8.5% | $101,560 |
| JETSET Pilates | A | 9% | $543,440 |
| KOA | A | 10% | $40,050 |
| British Swim School | A | 12% | $95,200 |
Your validation-call playbook
- Your actual annual net revenue for the most recent full year—and what percentage came from commercial accounts versus retail walk-in? Did commercial sales exceed 35% of total?
- What did you actually net after debt service, all fees, and a reasonable owner draw? Was the Item 19 EBITDA figure consistent with your experience, or did unquantified expenses (vehicle repairs, bad debt, legal, accounting) materially change the outcome?
- How many hours per week do you personally work in the store, and have you been able to hire and retain a dedicated commercial sales rep—and if so, what did that cost versus the revenue lift it generated?
- Have you ever missed the $600,000 annual net revenue minimum quota, and if so, what did Batteries Plus do—and have you experienced any territory modifications or threats to your Protected Area?
- What has your actual experience been with mandatory purchases through Ascent—do you believe you are paying materially above market for inventory, and have you been able to source approved alternatives at better pricing?
- If you had to do it again, would you renew at the end of your 10-year term knowing you must sign a new (potentially different) franchise agreement and execute a general release of all claims against Batteries Plus?
Bottom line
Batteries Plus offers a defensible niche in battery and device repair retail, but the economics are brutally compressed at median volume: ~$75K operating profit before debt service leaves only ~$29K after a 10-year SBA loan—inadequate owner compensation without a draw. The system is shrinking (net -8 franchised units over 3 years), a $590K franchise-law settlement signals disclosure risk, and roughly half of franchisees fall below the revenue level needed to cover debt service. This franchise only pencils for a well-capitalized, commercially aggressive operator targeting top-quartile performance ($1.1M+ revenue) from day one.
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