Category risk

Home services carries the highest distress on the smallest loans

Current distress rate by franchise category, FY2021–FY2025 originations.

Low barrier to entry, cheap to finance, hard to sustain — the home-services category shows the highest distress of any franchise segment on the smallest average loan. Food service and lodging, the largest category by volume, sits mid-table; its high average loan reflects hotel flags, not restaurants.

13.40%home services distress — $294,787 average loan

9.86%food service and lodging — $1,201,891 average loan

9,877franchise loans in food service and lodging, the largest category

Source: Analysis of SBA 7(a) FOIA loan-level data (as of 31 March 2026). Cancelled approvals excluded. Franchise status per the SBA franchise name field. Published by sba-feasibility-study.com.