Andy's Frozen Custard Franchise Cost (2026): $1.1M–$2.55M

Andy's Frozen Custard franchise startup costs run $1.1M–$2.55M for a drive-through frozen custard concept founded in Osage Beach, Missouri. Andy's has built a devoted regional following through its custard-forward menu and a drive-through model that generates strong throughput during peak dessert seasons.

Key takeaways

Total estimated startup cost: $1,100,000–$2,550,000 (drive-through frozen custard concept)
Franchise fee: $37,500
Ongoing royalty: 6% of gross sales; advertising fund contribution applies
100+ locations primarily in the Midwest and South; founded 1986 in Osage Beach, MO
Listed on the SBA Franchise Directory — eligible for expedited SBA loan processing

Andy's Frozen Custard is a drive-through frozen custard franchise founded in 1986 in Osage Beach, Missouri, by Andy and Carol Kuntz. The brand operates 100+ locations primarily across the Midwest and South and has built one of the most loyal regional frozen dessert fanbases in the United States. Andy's model centers on made-fresh-daily frozen custard — a denser, richer alternative to soft-serve ice cream — served through a drive-through format that generates strong peak throughput during warm-weather months. The brand's concrete mixers (custard blended with mix-ins) and sundaes drive strong average check values above the base custard price point. Prospective franchisees should review the current Franchise Disclosure Document (FDD) under the FTC Franchise Rule (16 CFR Part 436).

Total startup cost breakdown

Per the current FDD filed under the FTC Franchise Rule (16 CFR Part 436), total estimated initial investment for an Andy's Frozen Custard franchise runs $1,100,000–$2,550,000. The drive-through-first format and freestanding building drive the investment range:

Franchise fee: $37,500
Real estate and building (freestanding drive-through): $400,000–$1,200,000
Frozen custard machines and cold equipment: $100,000–$300,000
Drive-through equipment, canopy, and lane technology: $50,000–$150,000
Interior fixtures and serving area build-out: $50,000–$150,000
Signage and exterior branding: $30,000–$80,000
Technology and POS systems: $15,000–$40,000
Training and travel: $10,000–$30,000
Grand opening marketing: $10,000–$30,000
Working capital (3 months): $40,000–$120,000
Permits, insurance, professional fees: $20,000–$60,000

Ongoing fees

Andy's Frozen Custard charges a 6% royalty on gross sales plus advertising fund contributions. The 6% rate reflects the brand's investment in the proprietary custard formulation, ongoing product development, and the marketing infrastructure that has built Andy's regional cult following. The seasonal nature of the business requires operators to plan for strong summer revenue to fund lower winter months.

Financing options

Andy's Frozen Custard is listed on the SBA Franchise Directory, qualifying franchisees for expedited SBA loan processing. Financing paths:

SBA 7(a) loan: Covers franchise fee, freestanding building or leasehold, custard equipment, and working capital per the SBA 7(a) program. The $1.1M–$2.55M range spans upper-tier 7(a) structures.
SBA 504 loan: For land purchase and freestanding building construction, SBA 504 pairs bank financing with an SBA-guaranteed debenture for fixed-asset projects up to $5.5M.
Equipment financing: Commercial frozen custard machines and cold equipment can be financed separately over 5–7 years.
Working capital line of credit: Critical for managing seasonal cash flow — covers the winter operating period and pre-summer staffing ramp.
Conventional commercial mortgage: For operators purchasing real estate outright in their target market.

Realistic ROI timeline

Frozen custard drive-through concepts at the $1.1M–$2.55M investment level typically target break-even within 30–48 months. Andy's high AUV reputation is driven by the drive-through format's peak-season throughput capacity — properly sited locations in warm-climate or high-traffic suburban markets can generate significant seasonal revenue. Operators should model seasonal cash flow carefully: summer peak months may generate 60–70% of annual revenue, requiring disciplined working capital management through cooler months.

Who's a good fit

Andy's Frozen Custard suits operators with QSR or drive-through food service experience who want a high-loyalty dessert brand with strong regional equity. The freestanding drive-through model requires real estate expertise for site selection. Financial benchmarks typically include net worth of $750K+ and liquid capital of $300K+. Operators in the Midwest, South, and Sun Belt benefit from Andy's existing brand awareness in those markets.

What lenders look for in an Andy's Frozen Custard franchise application

Andy's Frozen Custard is on the SBA Franchise Directory, qualifying franchisees for expedited SBA loan eligibility review. At $1.1M–$2.55M, SBA 7(a) and SBA 504 both apply depending on whether land is purchased or leased. Key underwriting factors:

Debt service coverage ratio (DSCR): SBA guidelines require a minimum 1.15× DSCR; lenders underwriting $1M+ drive-through custard builds typically require 1.25×–1.35×. Andy's 6% combined royalty (royalty + ad fund) is mid-range — DSCR pro formas must account for the summer peak/winter trough revenue cycle. Source: SBA Standard Operating Procedure 50 10 7 (sba.gov).
Seasonal DSCR modeling: Andy's is a peak-summer drive-through concept — summer months generate 60–70% of annual revenue. Lenders require annual DSCR modeling (not peak-month), meaning winter slow-period cash flow must still service the debt. Pro formas with only peak-season projections will be rejected.
Frozen custard equipment collateral: Custard freezers, batch freezers, and drive-through equipment are specialized assets with a 30–50% lender collateral discount vs. purchase cost. SBA 504 is the preferred structure when real estate is being purchased to optimize collateral value with a fixed-asset debenture.
Equity injection: SBA requires a minimum 10% equity injection; most lenders require 20–25% for $1M+ QSR builds ($220K–$638K at this range). The upper end of the investment range ($2M–$2.55M) typically requires 25% equity to satisfy lender risk thresholds.
Trade area brand strength: Andy's concentrated presence in the Midwest and South is a positive credit signal for lenders — consumer awareness supports AUV projections. New trade areas outside the core footprint require stronger comparable-unit performance data to justify pro forma revenue assumptions.

Deal structure note

SBA 504 is the preferred structure for Andy's builds involving land purchase — a CDC debenture covers up to 40% of real estate and construction costs at a fixed rate, while a bank first mortgage covers 50%. For leased sites, SBA 7(a) covers the full build-out, equipment, and working capital in a single loan.

Apply for franchise financing

ClearValue Lending works with frozen dessert and QSR drive-through franchise operators on SBA 7(a), SBA 504, equipment, and working capital financing. Apply for franchise financing at Find my match. Your file routes to one matched lender.

Sources

Andy's Frozen Custard is listed on the SBA Franchise Directory, qualifying franchisees for expedited SBA loan eligibility review. — SBA Franchise Directory
SBA 7(a) loans finance frozen dessert franchise startups including freestanding building, custard equipment, and working capital. SBA 504 is available for real estate purchase and construction. — SBA 7(a) Loan Program
All franchise cost and fee disclosures are governed by the FTC Franchise Rule requiring a Franchise Disclosure Document (FDD) be delivered at least 14 days before signing. — FTC Franchise Rule — 16 CFR Part 436
Qualifying frozen custard machines and drive-through cold equipment placed in service during the tax year may be immediately expensed under IRS Section 179. — IRS Publication 946

Frequently asked questions

How much does an Andy's Frozen Custard franchise cost in 2026?

Per the current FDD, total estimated initial investment runs $1,100,000–$2,550,000. The freestanding drive-through build, frozen custard machines, and real estate are the primary cost drivers.

Where was Andy's Frozen Custard founded?

Andy's Frozen Custard was founded in 1986 in Osage Beach, Missouri, by Andy and Carol Kuntz. The brand has grown to 100+ locations primarily across the Midwest and South, with strong expansion in the Sun Belt.

What is the Andy's Frozen Custard royalty rate?

Andy's charges a 6% royalty on gross sales plus advertising fund contributions. The seasonal nature of the business requires strong summer revenue to cover annual royalty obligations and winter operating costs.

Can I finance an Andy's Frozen Custard franchise with an SBA loan?

Yes. Andy's Frozen Custard is on the SBA Franchise Directory. SBA 7(a) can cover the freestanding building, custard equipment, franchise fee, and working capital. SBA 504 is available for land purchase and construction.

Is frozen custard a seasonal business?

Yes — frozen custard drive-through concepts like Andy's are highly seasonal, with summer peak months typically generating 60–70% of annual revenue. Operators must plan seasonal cash flow carefully, using working capital lines to fund the winter operating period and the spring staffing ramp.

What DSCR do lenders require for an Andy's Frozen Custard franchise?

SBA guidelines set a minimum DSCR of 1.15×. In practice, lenders underwriting $1M+ custard drive-through builds require 1.25×–1.35× on an annualized basis — peak summer volume alone does not satisfy the DSCR requirement. Pro formas must show sufficient full-year cash flow (including winter trough months) to service the debt. Source: SBA Standard Operating Procedure 50 10 7 (sba.gov).

How much equity injection is required for an Andy's Frozen Custard franchise loan?

SBA requires a minimum 10% equity injection of total project cost. For $1.1M–$2.55M Andy's builds, most lenders require 20–25% — $220,000–$638,000 in documented non-borrowed funds. The upper end of the range ($2M–$2.55M) typically requires 25% equity given the higher construction and equipment exposure.