Quick Service Restaurant Feasibility Study in Montana

A cell that tracks its surroundings

Montana's limited-service restaurant lending does not separate itself from the pattern around it. SBA approved 83 loans for these restaurants between FY2017 and FY2026, worth $33.7 million in gross dollars, and the location quotient of 1.01x says the class takes almost exactly the share of Montana lending that it takes nationally. Loan size, cancellation and charge-offs are set out below. The honest reading is that this page describes a normal quick-service book in a small state, ranked 43 of 54 among states for the class yet second among 39 classes inside Montana.

Loan size and the lender table

The median loan is $275,000, which puts it at 0.88x of the class median across the country, with the central band of loans spanning $149,000 to $460,250. SBA 7(a) carried 73 loans against 10 under SBA 504, so the real estate programme plays a small part. Franchise brands account for 53.0% of loans. Glacier Bank tops the SBA 7(a) lender list at 17 loans and $5.8 million, followed by Three Rivers Bank of Montana with 8 and The Yellowstone Bank with 5. Dakota Business Lending is the named SBA 504 lender with 5 loans worth $1.4 million. Yellowstone County produced 20 loans and Gallatin County 15, ahead of Flathead with 12 and Missoula with 11.

Timing, cancellations and losses

Approvals have been uneven. FY2023 produced only 3 loans and $882,300, while FY2025 reached 14 loans and $11.6 million, so a single year is a weak guide to demand. Of Montana restaurant loans approved from FY2017 through FY2024, at least 13.6% were cancelled before funding, and 15.3% if loans still undisbursed are treated as cancelled; both are floors on a final figure. Within the funded cohort of 31 loans from the FY2017 to FY2021 vintages, 9.7% are losses to date, and the five-year measure reads 0.00%. The gap shows that losses surfaced after the fifth year, and the cohort is small enough that one failure moves the rate visibly. Open loans can still default, so treat these numbers as minimums.

What a feasibility study must test

A study for a Montana quick-service restaurant should begin with traffic and trade area. It should compare build-out and equipment spending with a ticket that usually sits near $275,000, then show debt service coverage in a slow winter case as well as the base case. Where a franchise is involved, the study should test royalty and advertising obligations against realistic sales. The appraisal will lean on the going concern and the lease, so the revenue forecast must be one a reviewer can reproduce. The cancellation floor is a reminder that a sizeable share of approved projects never close.