Thai Express Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$360,400 - $949,700
Franchise Fee
$30,000
Min Cash Required
$5,000
Total US Locations
6
Business Summary
Thai Express offers franchises for retail quick-service restaurants specializing in "Thai-style" foods and drinks. Thai Express restaurants operate using a uniform system focused on high standards of service and consistent quality products under the THAI EXPRESS trademark. These businesses primarily serve customers with a range of Thai-inspired menu items.
Corporate History
MTY Food Group, Inc., the ultimate corporate parent of Thai Express, was incorporated in Canada in 1979. MTY Franchising USA, Inc., the franchisor, was incorporated in Delaware in 2001 and converted to a Tennessee corporation in 2019. Thai Express began offering unit franchises in the United States in February 2015. The broader MTY Food Group operates or franchises over 50 different concepts, including numerous acquisitions such as BBQ Holdings, Inc. in 2022 and Wetzel's Pretzels, LLC in 2022, continuously diversifying its offerings.
Financial Overview
Investment Range
$360,400 - $949,700
Franchise Fee (Low)
$30,000
Franchise Fee (High)
$30,000
Minimum Cash Required
$5,000
Royalty %
6%
Marketing %
3%
Equipment Costs (Low)
$174,500
Equipment Costs (High)
$325,500
Working Capital
$30,375
Audited Financials
Yes
Offers Financing
Yes
Audit Opinion
Unqualified opinion
Financial Health Notes
The independent auditors issued an Unqualified Opinion for Thai Express's consolidated financial statements for the years ending November 30, 2024, and 2023, indicating that the financial statements present fairly in all material respects. No going concern qualification was noted by the auditors. In 2024, Thai Express reported a net loss of $12,556 thousand, a decrease from a net income of $16,978 thousand in 2023. The company experienced a decrease in current assets, including cash, and a slight increase in current liabilities. Notably, Thai Express recorded significant impairment charges totaling $43,602 thousand in 2024 on property, plant and equipment, intangible assets, and goodwill, including a $29,685 thousand goodwill impairment related to the Papa Murphy's brand due to strategic realignment. Thai Express also has substantial intercompany financial arrangements, including a $194,988 thousand receivable from its ultimate parent and a $708,363 thousand long-term loan from a company under common control.
Financing Details
Thai Express generally does not offer direct or indirect financing. It will not guarantee a franchisee's obligations for notes or other debts, except in specific situations for the lease of a site, or if a franchisee purchases an existing corporate-owned restaurant from one of its affiliates. In such a case, the franchisor, at its sole discretion, may finance up to 100% of the purchase price, with annual interest rates ranging from 0% to 12% and repayment terms between 12 to 60 months. This financing is secured by a first lien on all equipment. Each principal and their spouse (if married) must personally guarantee the debt. Franchisees are also restricted from borrowing more than 70% of the total project costs for establishing a Thai Express franchise without the franchisor's prior written consent.
Performance Metrics
Total US Locations
6
Franchised Units
5
Corporate Units
1
Avg Square Footage
1,000
Franchising Since
2015
Legal & Compliance Analysis
Recent Litigation
Yes
Bankruptcy
No
Litigation Count
15
Litigation Summary
Thai Express and its affiliates have been involved in various lawsuits and arbitrations, all of which are now concluded. These past disputes involved allegations such as violations of franchise investment protection acts, misrepresentation of financial performance, breach of contract, unjust enrichment, and fraud. Specific cases included settlements ranging from $20,000 for a Washington FIPA violation to $300,000 for a fraud claim against a sweetFrog franchisee. Other resolved cases dealt with unpaid royalties, unauthorized store closures, and trademark infringement. Papa Murphy's International, an affiliate, also settled lawsuits from franchisees concerning financial performance representations in 2020, through various arrangements including advertising cost payments and store repurchases. Wetzel's Pretzels, another affiliate, settled a franchisee claim for rescission and restitution for $125,000. In addition to past litigation, two lawsuits were filed by Thai Express's affiliates during the fiscal year ending November 30, 2024. Kahala Franchising, LLC filed a breach of contract suit against All About Food, Inc. and Chu Yup Lee a/k/a Michale Lee in Illinois, and Cold Stone Creamery Leasing Company, Inc. filed a suit for forcible entry and detainer against JRF, Inc. in Iowa. Thai Express's predecessors and affiliates have also faced concluded state administrative actions primarily for issues related to franchise registration and disclosure compliance in Maryland and Virginia, resulting in consent orders, civil penalties, and offers of rescission for unregistered franchise sales.
Bankruptcy History
Thai Express and its affiliates have no bankruptcy history required to be disclosed.
Agreement Terms
Initial Term
10 years
Renewal Term
5 years
Renewal Conditions
To renew their franchise agreement, Thai Express franchisees must provide at least 120 days' notice before the current term expires. They must not be in default of their existing franchise agreement or any other agreements with the franchisor or its affiliates, and should not have received more than three notices of default during the term, or more than two in the five years preceding the renewal date. Franchisees must have a suitable premises, sign a new franchise agreement which may contain materially different terms (including higher royalty and marketing fees), pay a renewal franchise fee equal to 50% of the then-current initial franchise fee, remodel or refurbish their restaurant to meet current brand standards, and be current on all financial obligations. Additionally, they must sign a general release provided by Thai Express.
Training & Support Program
Franchisor Assistance
Thai Express provides pre-opening assistance with site selection and offers an Operations Manual detailing mandatory specifications and procedures. The franchisor provides store specifications, including build-out, design, and equipment requirements, and assists in obtaining furniture and equipment from approved suppliers. Before opening, franchisees must complete a 200-hour training program, which includes 40 hours of new owner classroom training and 160 hours of in-store training. Thai Express also provides one or more representatives for at least five days to assist during the first week of operations. Ongoing assistance includes continuing research on new products and methods, telephone or email consultation for operational questions, and guidance on recipes, purchasing, advertising, and employee training programs. Thai Express may hold mandatory annual conferences and distribute quarterly newsletters. The franchisor also provides advertising materials and requires franchisees to participate in national, regional, and local marketing campaigns.
Initial Training Hours
200
Training Location
Online, KTEC (Kahala Training & Education Center) in Scottsdale, AZ
Ongoing Support
After opening, Thai Express provides ongoing support to its franchisees through various channels. This includes continuing research into new products, services, and business methods, with information shared with franchisees. Franchisees can access ongoing consultation via telephone or electronic mail during regular business hours for operational questions. Thai Express offers operational guidance on recipes, purchasing, advertising, and general management procedures, as well as assistance with establishing employee training programs. This guidance is provided through manuals, bulletins, videos, written materials, and consultations. Franchisees are required to attend mandatory annual conferences (with travel and living expenses paid by the franchisee) to discuss sales, new products, marketing, and operational procedures. Thai Express may also send quarterly newsletters. Additionally, the franchisor provides advertising materials and requires active participation in national, regional, and local advertising and sales promotion campaigns.
Franchise Requirements
Ideal Candidate Profile
Thai Express seeks qualified individuals and companies for its franchises. While the FDD does not specify required prior industry, management, sales, or technical experience, it emphasizes that the success of the business depends significantly on the franchisee's abilities as an independent businessperson. Franchisees are encouraged to devote their full time and attention to managing, supervising, and developing the business, as active involvement of an owner/manager is deemed crucial for success, potentially leading to higher sales and lower costs. The Designated Manager, who may be the franchisee or another partner, must complete the training program and demonstrate fluency in English, including the ability to read, write, and converse, by passing a competency test.
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
Non-Exclusive
Staffing Notes
Thai Express locations must maintain an adequate and properly trained staff to serve customers effectively. Franchisees are responsible for managing and training employees, ensuring proper customer service, and efficient operations. The Designated Manager, who oversees day-to-day operations, must have successfully completed the franchisor's training program and be fluent in English. The franchisor provides guidance on hiring, employee appearance, conduct, and training, including the use of uniforms. Thai Express may also assist in establishing employee training programs at the restaurant.