Quick Service Restaurant Feasibility Study in South Carolina

Franchise-heavy and growing in South Carolina

South Carolina's quick service lending is large, branded and recent. The state approved 258 limited-service restaurant loans in FY2017 to FY2026, worth $147.5 million, which makes quick service its 3 of 39 class by count and ranks the state 24 of 54 nationally. The location quotient of 1.16x leans the state's book toward the class. Franchised concepts account for 63.2% of loans. At $352,000 the median sits at 1.13x the class median nationwide, and our screen, run against South Carolina's all-class figures and quick service nationally, flags none of the metrics; growth, brands and early losses are what this page has to explain.

Upstate, Lowcountry and many lenders

FY2025 brought 46 approvals worth $29.4 million, the high point of the series, after 11 in FY2020. Lending is spread widely: The Huntington National Bank holds 24 loans and Stearns Bank National Association 23, while Pinnacle Bank's 18 are worth $16.5 million and United Community Bank's 13 are worth $12.4 million; TD Bank, National Association holds 16. SBA 504 carried 20 loans, led by Provident Business Financial Services, Inc. with 8 and Appalachian Development Corporation with 5, and 7(a) carried 238. Most South Carolina loans fall between $189,250 and $740,250. Greenville County leads with 40, Charleston with 32, and Richland and York with 23 each.

Early losses

South Carolina's FY2017 to FY2024 quick service approvals show a 12.5% cancellation floor, equal to the 12.5% ceiling and close to the class nationally. Charge-offs are notable for timing: of 91 loans funded over FY2017 to FY2021, 6.6% have been charged off to date and 5.5% within five years of approval, so most failures arrived in the early years of the loan. The overall floor is close to quick service nationally.

Early failures tell a South Carolina borrower that the opening ramp is where quick service loans have broken here. A study should therefore concentrate on the first years of trading: realistic opening sales at this site rather than the brand's system average, pre-opening and training costs, and the cash needed to carry the store until volume settles. Demand has to be measured at the pad, with traffic counts, access, drive-through stacking and the competing brands nearby, which matters in a market where approvals have risen quickly. Cost includes the franchise fee, construction or build-out and equipment. Coverage of debt service should be shown after royalties and advertising fees at a cautious first-year volume. If land or a building is financed, the collateral is a single-tenant restaurant property whose appraised value rests on a forecast like this one.

Rates are floors that loans still open in South Carolina can raise, and lender names are the holders shown in SBA's current records.