Risk Score
Pending analysis
Investment Range
$528,400 - $1,127,950
Franchise Fee
$15,000
Min Cash Required
$20,000
Total US Locations
37
Business Summary
Rusty Taco Franchising, LLC offers franchises for Rusty Taco restaurants, which are designed as neighborhood gathering places. These restaurants serve freshly prepared food with quality ingredients, drawing inspiration from Mexican and Texan flavors. They also offer a variety of alcoholic and non-alcoholic beverages.
Corporate History
Rusty Taco Franchising, LLC was formed in October 2022 and began offering Rusty Taco restaurant franchises in May 2023. The current franchisor acquired the assets, including existing franchise agreements, from its predecessor, Rusty Taco, Inc., which had been selling Rusty Taco franchises from May 2015 until December 2022. Rusty Taco restaurants were known as "R Taco" from September 2015 through August 2018. The current franchisor is focused solely on franchising Rusty Taco restaurants and has not operated them directly.
Financial Overview
Investment Range
$528,400 - $1,127,950
Franchise Fee (Low)
$15,000
Franchise Fee (High)
$30,000
Minimum Cash Required
$20,000
Royalty %
5%
Marketing %
2%
Equipment Costs (Low)
$416,000
Equipment Costs (High)
$871,000
Working Capital
$35,000
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Rusty Taco Franchising, LLC's financial statements raise concerns about its ability to provide services and support to franchisees. The company has a negative member's equity, showing a deficit of over $691,000 as of December 2024, which grew from a deficit in the prior year. Rusty Taco Franchising, LLC also experienced a significant net loss of over $1 million in 2024. Unaudited statements for early 2025 continue to show a growing equity deficit and net losses.
Financing Details
Rusty Taco Franchising, LLC does not offer any direct or indirect financing to its franchisees. This means Rusty Taco Franchising, LLC will not provide loans, lease guarantees, or other financial assistance. Franchisees are responsible for securing all their own financing through third-party lenders.
Performance Metrics
Total US Locations
37
Franchised Units
36
Corporate Units
1
Avg Square Footage
2,000
Franchising Since
2023
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
Rusty Taco Franchising, LLC reports that it has no litigation history that is required to be disclosed in this Franchise Disclosure Document.
Bankruptcy History
Rusty Taco Franchising, LLC has no bankruptcy history to report for itself or its key executives.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew a Rusty Taco franchise, franchisees must notify Rusty Taco Franchising, LLC between 12 to 24 months before their current term ends. They must be in good standing, meaning they have complied with all material terms of their franchise agreement and have paid all outstanding amounts to the franchisor, its affiliates, and suppliers. The restaurant must be renovated to meet current brand standards, and the franchisee must have the right to occupy the location or have secured an approved alternative site. Franchisees must also meet current qualification and training requirements, sign Rusty Taco Franchising, LLC's then-current franchise agreement (which may have different terms for fees), and all owners must sign a personal guarantee and a general release of all claims against the franchisor and its related parties. Finally, a renewal fee equal to 50% of the then-current initial franchise fee must be paid.
Training & Support Program
Franchisor Assistance
Rusty Taco Franchising, LLC provides assistance both before and after a restaurant opens. Before opening, Rusty Taco Franchising, LLC helps with reviewing and approving the proposed site and lease, provides access to approved restaurant specifications and layouts, and gives a list of required food items and approved suppliers. They conduct an initial training program and offer on-site opening assistance for a franchisee's first Rusty Taco restaurant. During operation, Rusty Taco Franchising, LLC offers advice and written materials on managing and operating the restaurant, provides updated lists of approved suppliers, and administers the brand development fund. Franchisees also get access to proprietary software programs. Rusty Taco Franchising, LLC may provide ongoing consultation, remedial or additional training, and set maximum and minimum prices for products. The ongoing training may involve access to a learning management system, which would incur an annual fee per restaurant.
Initial Training Hours
200
Training Location
Dallas, Texas or other designated locations
Ongoing Support
Rusty Taco Franchising, LLC provides ongoing support by offering advice and written materials on managing and operating Rusty Taco restaurants, updated lists of approved suppliers, and administering the brand development fund. Franchisees also have access to proprietary software programs. Rusty Taco Franchising, LLC may provide ongoing consultation, remedial or additional training programs (for which fees may apply), and set maximum or minimum prices for products. The ongoing training may include access to a learning management system, which would incur an annual fee per restaurant.
Franchise Requirements
Ideal Candidate Profile
Rusty Taco Franchising, LLC looks for individuals or entities who have the financial capacity and experience, and are committed to developing and operating multiple Rusty Taco restaurants. If the franchisee is not a natural person, they must designate an Operating Principal who is approved by Rusty Taco Franchising, LLC and holds at least a 10% ownership interest. This Operating Principal is expected to dedicate full-time efforts to the restaurant's day-to-day supervision and management, and not engage in other businesses requiring substantial time commitment. If a franchisee operates more than one restaurant, a separate, approved Restaurant Manager must also be appointed to devote full-time efforts to that restaurant's management.
Industry Experience Required
No
Management Experience Required
No
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
retail
Owner Participation
Full-Time
Territory Type
Protected
Territory Size Requirements
Rusty Taco Franchising, LLC defines the protected territory as a geographic area that is typically a circle with a two-mile radius around the restaurant's front entrance. In densely populated urban areas like New York City or Washington D.C., the protected territory might be smaller, potentially limited to just an office or retail building.
Staffing Notes
Rusty Taco Franchising, LLC requires each restaurant to have an approved Operating Principal who holds at least a 10% ownership interest and dedicates full-time efforts to the day-to-day supervision of the restaurant. If a franchisee operates multiple locations, an approved Restaurant Manager is also required for each, who must devote full-time efforts to that restaurant's management. These key personnel cannot engage in other businesses requiring substantial time. Franchisees are solely responsible for all other staffing decisions, including hiring, training, compensation, and discipline of their employees. All staff must wear designated uniforms and maintain a neat appearance. The Operations Manual provides job responsibilities for various roles such as cashier, line cook, prep cook, host, chipper, and manager, along with detailed cleaning and maintenance schedules.