Buying a Supercuts franchise: SBA acquisition loan data
Since FY2018, SBA lenders have approved 35 7(a) loans to buy an existing Supercuts (classified mostly as Beauty Salons), totaling $29.7M. The median loan was $467,000, 28% lower than the $645,250 median for all SBA-financed acquisitions. 1 of these loans were approved in the last two fiscal years.
The purchase agreement decides what you bought, not the loan approval.
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What this tells a buyer
- Price range to expect. Loan size tracks purchase price. Half of Supercuts resale loans landed between $255,000 and $1,206,000.
- Lender experience exists. Bank of America, National Association alone has financed 10 Supercuts resales.
- Guaranty. The SBA guaranteed 75% of the dollars lent here.
- What the file leaves out. The SBA file does not record franchisor transfer terms or fees.
Financing a Supercuts resale
The median SBA 7(a) loan for a Supercuts resale was $467,000 across 35 loans (FY2018 to FY2026). Bank of America, National Association, Stearns Bank National Association and Live Oak Banking Company have financed the most Supercuts resales. Of 33 seasoned loans (FY2018 to FY2021), none were charged off, against the 3.5% average for all SBA acquisition loans.
Supercuts acquisition loans by year
| Fiscal year | Loans | Total approved | Median loan | |
|---|---|---|---|---|
| FY2018 | 3 | $738K | $201,900 | |
| FY2019 | 28 | $26.8M | $625,750 | |
| FY2020 | 1 | $135K | $135,000 | |
| FY2021 | 1 | $725K | $725,000 | |
| FY2022 | 0 | $0 | - | |
| FY2023 | 1 | $1.2M | $1,200,000 | |
| FY2024 | 0 | $0 | - | |
| FY2025 | 1 | $183K | $182,700 | |
| FY2026 | 0 | $0 | - |
How often do these acquisition loans fail?
Of the 33 Supercuts acquisition loans approved from FY2018 to FY2021 (the seasoned cohort, every loan at least about five years old), none have been charged off by the SBA. 24 have already been paid in full.
For comparison, Supercuts has none charged off, against the 3.5% average across all SBA 7(a) acquisition loans in the same cohort. Non-acquisition 7(a) loans (every other stated purpose) approved FY2018 to FY2021 charged off at 6.2%.
"Charged off" is the SBA's final loss action on a defaulted loan after collection efforts. It lags default by a year or more, which is why only older cohorts are measured. It is not the same as a delinquency rate, and loans still outstanding can still fail. See charge-off in the glossary.
Seller note standby terms and third-party consents are reviewed before closing.
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Lenders financing Supercuts resales
| # | Lender | Loans | Share | Dollars | |
|---|---|---|---|---|---|
| 1 | Bank of America, National Association | 10 | 28.6% | $9.8M | |
| 2 | Stearns Bank National Association | 8 | 22.9% | $2.1M | |
| 3 | Live Oak Banking Company | 4 | 11.4% | $8.8M | |
| 4 | The Huntington National Bank | 3 | 8.6% | $1M | |
| 5 | BankUnited, National Association | 2 | 5.7% | $2.5M | |
| 6 | Ameris Bank | 2 | 5.7% | $1.9M | |
| 7 | Beacon Bank and Trust | 1 | 2.9% | $2.3M | |
| 8 | FinWise Bank | 1 | 2.9% | $650K | |
| 9 | Simmons Bank | 1 | 2.9% | $202K | |
| 10 | Encore Bank | 1 | 2.9% | $183K |
States where Supercuts units are bought
| # | State | Loans | Share | Dollars | |
|---|---|---|---|---|---|
| 1 | Florida | 8 | 22.9% | $6.2M | |
| 2 | Nevada | 5 | 14.3% | $2.4M | |
| 3 | California | 4 | 11.4% | $6.6M | |
| 4 | Texas | 3 | 8.6% | $1.2M | |
| 5 | New Jersey | 2 | 5.7% | $3.1M | |
| 6 | New York | 2 | 5.7% | $2.3M | |
| 7 | Connecticut | 1 | 2.9% | $2.3M | |
| 8 | Colorado | 1 | 2.9% | $1.3M | |
| 9 | Virginia | 1 | 2.9% | $1.2M | |
| 10 | Arizona | 1 | 2.9% | $739K |
Terms signed in the LOI shape the purchase agreement that follows.
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How lenders classify Supercuts
Lenders code each loan to a NAICS industry. For Supercuts the codes used were:
| # | Industry | Loans | Share | Dollars | |
|---|---|---|---|---|---|
| 1 | Beauty Salons | 33 | 94.3% | $29M | |
| 2 | Barber Shops | 2 | 5.7% | $767K |
Questions buyers ask
How much do buyers borrow to buy a Supercuts franchise?
The median SBA 7(a) loan for a Supercuts resale was $467,000 across 35 loans (FY2018 to FY2026). The middle half of loans ran from $255,000 to $1,206,000. The loan excludes the buyer's equity and any seller note and may include working capital, so the price is usually higher than the loan.
Which banks finance Supercuts acquisitions?
Bank of America, National Association has made the most SBA acquisition loans for Supercuts (10, 29% of the total). Stearns Bank National Association, Live Oak Banking Company, The Huntington National Bank follow.
What interest rate and term do Supercuts acquisition loans carry?
The average initial rate at approval was 6.83% (a blend of fixed and variable loans across several rate environments, so treat it as context, not a quote). The median term was 10 years.
Is a Supercuts resale riskier than other SBA-financed acquisitions?
In the seasoned cohort (FY2018 to FY2021), none charged off, against the 3.5% average for all SBA acquisition loans.
Where are Supercuts units being bought with SBA loans?
Florida (8), Nevada (5), California (4), Texas (3), New Jersey (2). State counts follow where the brand has units and where SBA lending is most active generally; see the state pages for the overall picture.
The purchase agreement decides what you bought, not the loan approval.
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Related
- All Beauty Salons acquisitions
- Florida acquisitions
- Nevada acquisitions
- California acquisitions
- Bank of America, National Association
- Stearns Bank National Association
- Live Oak Banking Company
- All franchise brands
Brand name as recorded by lenders in the SBA file: "Supercuts" (franchise code S1648). Figures are aggregates of public SBA data and are not provided or endorsed by the franchisor.