Risk Score
Pending analysis
Investment Range
$341,000 - $577,000
Franchise Fee
$30,000
Total US Locations
191
Business Summary
WaBa Grill operates quick-casual restaurants that specialize in Asian-inspired rice bowl menu items and beverages. These restaurants offer freshly-prepared food using proprietary recipes, sauces, and high-quality ingredients, available for carry-out, delivery, and on-premises dining.
Corporate History
WaBa Grill Franchise Corp. was initially formed as WaBa Grill, LLC on December 3, 2008, and later converted to WaBa Grill Franchise Corp., a California corporation, on November 28, 2011. Its predecessor, WaBa Grill, Inc., was incorporated on November 30, 2006. The parent company, WaBa Restaurant Group (formerly BKE Enterprises, Inc.), was formed on July 1, 2004, and operated restaurants under the 'Fresh Grill' trade name since November 2004, which began converting to 'WaBa Grill' in April 2006.
Financial Overview
Investment Range
$341,000 - $577,000
Franchise Fee (Low)
$30,000
Franchise Fee (High)
$35,000
Royalty %
5%
Marketing %
3%
Equipment Costs (Low)
$258,000
Equipment Costs (High)
$455,000
Working Capital
$25,000
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
WaBa Grill's auditors issued an unqualified opinion, indicating their financial statements present fairly. However, the company noted a violation of certain loan covenants as of December 31, 2023. The company also highlights that its operations are significantly influenced by economic conditions, consumer spending, supply chain issues, and intense competition in its markets.
Financing Details
WaBa Grill does not offer any direct or indirect financing to its franchisees. The franchisor also does not guarantee any notes, leases, or other obligations of the franchisee. Franchisees are responsible for obtaining their own financing.
Performance Metrics
Total US Locations
191
Franchised Units
186
Corporate Units
5
Avg Square Footage
1,600
Franchising Since
2007
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Count
1
Litigation Summary
WaBa Grill had one litigation case involving the Virginia State Corporation Commission and Eric Lee, which alleged an unregistered franchise sale in violation of the Virginia Retail Franchising Act. WaBa Grill and Eric Lee denied the allegations, stating the franchise agreement was signed after the company was registered in Virginia and the franchisee made their own decision to start the business before signing. The case was settled on January 9, 2015, where WaBa Grill and Eric Lee paid a monetary penalty of $2,000 and $1,000 for investigation costs, without admitting or denying the allegations.
Bankruptcy History
WaBa Grill states that neither the franchisor nor any of its predecessors, affiliates, or persons identified in Item 2 have been involved as a debtor in proceedings under the United States Bankruptcy Code.
Agreement Terms
Initial Term
10 years
Renewal Term
5 years
Renewal Conditions
To renew their franchise agreement, WaBa Grill franchisees must be in substantial compliance with the agreement, ensure their lease is renewable, and not be in default of any provisions. They need to provide notice of their intent to renew between 12 and 18 months before the initial term expires. Franchisees may also be required to remodel and update their restaurant to conform with WaBa Grill's current design standards, satisfy all monetary obligations, sign a general release of claims, meet current qualification and training requirements, and pay a renewal fee equal to one half of the then-current initial franchise fee.
Training & Support Program
Franchisor Assistance
WaBa Grill provides pre-opening assistance including site selection criteria, help coordinating construction, and assistance with purchasing equipment, signs, fixtures, and opening inventory. Franchisees receive the Confidential Operations Manual and support during their initial opening. Ongoing assistance includes advice on operating issues, guidance on standards and procedures, information on new menu items and food preparation methods, purchasing support, advertising and marketing programs, employee training, administrative, bookkeeping, and accounting procedures. WaBa Grill also conducts periodic inspections to ensure compliance with system standards and administers the advertising fund.
Initial Training Hours
89
Training Location
WaBa Grill Certified Training Restaurant and WaBa Grill Corporate Office
Ongoing Support
After opening, WaBa Grill provides ongoing support and guidance on operating issues, system standards, new menu items, food preparation, purchasing, advertising and marketing programs, and employee training. This guidance is provided through the Operations Manual, bulletins, written materials, and telephone consultations. WaBa Grill also conducts inspections of the restaurant's operations to ensure compliance with system standards and administers the advertising fund. Franchisees may be required to attend additional or refresher training programs, conferences, conventions, and meetings to enhance operations.
Franchise Requirements
Ideal Candidate Profile
WaBa Grill recommends that its franchisees conduct direct, on-premises supervision of their restaurant. If a franchisee appoints a manager for daily duties, that manager must have substantial food service experience, demonstrate strong management abilities, and promote the WaBa Grill image. The franchisee themselves must devote their full time and efforts to managing the general business matters of the restaurant.
Industry Experience Required
No
Management Experience Required
Yes
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Retail
Owner Participation
Full-Time
Territory Type
Non-Exclusive
Territory Size Requirements
For an individual franchise, WaBa Grill grants the right to operate at a specific single address and location only, explicitly stating that the location cannot be defined as a geographic area. For Area Development Agreements, the development area is typically described by municipal or county boundaries, or a specified trade area within a municipality, with the actual size varying based on market conditions, population, and the franchisor's development plans.
Staffing Notes
WaBa Grill franchisees must directly supervise the operation of the WaBa Grill restaurant or employ a manager for this purpose. If a manager is appointed, WaBa Grill requires this manager to be trained by the franchisor, inform the franchisor of their identity, and sign a confidentiality agreement. The manager does not need an ownership interest in the franchisee entity but must possess substantial food service experience, demonstrate strong management abilities, and promote the WaBa Grill image to the public. Franchisees are expected to devote their full time and efforts to managing the general business matters of the WaBa Grill restaurant and are prohibited from engaging in conflicting enterprises during the franchise term. For corporate franchisees, each shareholder/member holding more than 25% ownership is required to sign a personal guaranty. Area Developers must devote their full time to supervising the restaurants in their Development Area or designate an 'Operator' to do so. If an Operator is designated, they must successfully complete WaBa Grill's training course, devote full time to the development and supervision of restaurants, sign confidentiality and non-competition covenants, and be approved in writing by WaBa Grill. WaBa Grill may require Area Developers to hire an experienced food service professional to operate their restaurants. Franchisees are also responsible for the recruitment and hiring of all their employees and their training. WaBa Grill requires franchisees or their trained managers to be personally available to provide products to the consuming public for a minimum of ten hours per day, seven days per week, or as required by any lease or sublease, unless prohibited or regulated by governmental authority. These requirements may be changed by WaBa Grill from time to time with reasonable notice to the franchisee.