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Papa Murphy's Take 'N' Bake Pizza Franchise Cost & Fees

Date of Incorporation: 1981
Franchising Since: 1982
Headquarters: Vancouver, Washington

Business Description: Papa Murphy's Franchised Stores feature prepared take-and-bake pizza, fresh calzones, lasagnas and related products, and approved menu may be expanded to include other food products. Papa Murphy's customers are the general public, and Papa Murphy's products are likely to be sold primarily to persons seeking a fresh meal that can be served at home. The pizzas and pastas are prepared fresh each day entirely within the Franchised Stores and sold uncooked for customer preparation at home.

Franchise Offer: Franchisees operate a Papa Murphy's retail food outlet currently featuring take and bake pizza, fresh calzones, pastas, salads, desserts and other related products.

Financial Assistance: The franchisor does not provide direct or indirect financing and does not assist in providing financing. The franchisor does not guarantee any notes or financial obligations in setting up and operating franchise.

Training and Assistance: The franchisor will provide a four-phase training and familiarization program. The training program consists of selling aids, professional consultation and training materials which are comprised of videos, handouts, manuals, presentations and required tests. Training will cover recipes, product preparation and presentation, employee guidelines, customer relations, general business operations, retail sales practices, franchise systems management, bookkeeping and financial management, inventory control and purchasing, security practices, equipment operations, marketing, increasing sales at the location and assisting in creating relationships with customers. Although not required by the Franchise Agreement, the franchisor may provide other supervision, assistance, and services before the opening of the Franchised Store, such as advertising materials, literature, advertising materials, displays, and flyers.

Territory: The franchisee will be given a specific location within which he will operate the franchised store. The franchisee will not be granted an exclusive territory.

Term of Agreement and Renewal: The term of the franchise agreement is 10 years. Renewal or extension of the term is for an additional period of five years if the franchisee has satisfied the required pre-conditions.

Obligations and Restrictions: The franchisee, or approved operations personnel, must personally oversee and manage the actual day-to-day operation of the Franchised Store, except as Papa Murphy’s may agree in writing for good cause. Managers employed to help to operate the franchised store must successfully complete the mandatory training program. The franchisee may sell, serve or distribute only those Papa Murphy's Products, services and other items at the Franchised Store, which have been approved. The franchisee must offer all Papa Murphy's Products, services and other items that have been designated as required by the franchisor for franchisees. The franchisee must make all menu items in strict compliance with the franchisor’s specifications, recipes and requirements.

Estimated Number of Units: 1,490

Investment Tables:
Initial Investment
Name of Fee Low High
Initial Franchise Fee $25,000 $25,000
Lease and Utilities Deposits and Payments $2,500 $6,000
Leasehold Improvements $70,000 $153,000
Signs $5,000 $10,000
Stamped Architectural Drawings $4,200 $6,950
Opening Package (including Equipment and Supplies), decor, cabinets, point-of sale system and smallwares $115,000 $163,500
Miscellaneous Development Service Fees $0 $1,270
Inventory $5,000 $7,000
Initial Advertising Fees and Expenses - 6 months >$30,000 $30,000
Franchise Premises Rent - 3 months $3,600 $18,356
Materials and Supplies $500 $2,000
Phase 2 and Phase 3 Training $0 $500
Phase 4 (PMI Enterprise Solution Training) $400 $400
Travel and Living Expenses While Training (Phases 1-4) $3,880 $11,860
Employee Training $500 $1,500
Insurance - 3 months $375 $1,175
Bookkeeping/ Payroll Service - 3 months $1,500 $1,600
Additional Funds, Working Capital, and Miscellaneous Expenses - 3 months. $10,000 $50,000
Estimated Total Initial Investment $279,455 $492,861
Other Fees
Type of Fee Amount
Royalty Fee 5% of weekly Net Sales.
Advertising Fee 2% of weekly Net Sales.
Local Marketing and Promotion and Regional Cooperative Advertising Minimum of 5% of Net Sales or $2,000 during each four-week period.
Online Ordering Fee $0.35 per online transaction.
Marketing Kits $45 to $500
Studio Art Request Rush Fee and Custom Commercial Work $50
Customer Relations Management $35 per month for up to 50 telephone surveys; $.49 per survey overage fee.
Audit The costs of conducting an audit, plus related expenses.
Insurance The franchisee’s insurance must include at, a minimum, comprehensive general liability coverage, including products liability coverage, in amount of at least $2,000,000 per occurrence and business automobile liability insurance In an amount of at least $1,000,000 per occurrence. The franchisee must name the franchisor as an additional insured.
Transfer Fee If it is the transferee’s first Franchised Store, the Transfer Fee will be $25,000
If the transferee is an existing franchisee, the Transfer Fee will be $12,500
Indemnification Varies.
Additional Assistance or Training $100 to $300 per day.
Franchise Conventions $1,000 to $3,500
Convention Materials Up to $500
Successive Franchise Fee One-half of the then-current franchise fee.
Interest Interest of 1.5% per month unless otherwise limited by law (18% per annum).
Bookkeeping/ Payroll Service $0 to $500
Non-sufficient Funds Fees $35, plus reimbursement of fees incurred by the franchisor.
$525.30 per year.
Software Maintenance $381.10 per year.
Late Payment Fee $75
Hosting Fees, Anti-Virus Service and Additional Services $575 per year.
Payment Card Industry Data Security Standards Compliance (PCI-DSS) and Managed Firewall Service $55 per month.
Business Class High Speed lnternet Access $50 to $125 per month.
Upgrade, Refurbish and Replace $4,000 to $50,000
Expenses in Evaluating a Supplier Proposed by You Franchisor’s reasonable expenses.
Step-In Costs Personnel and administrative costs, plus 15%
Assignment Fees Up to $500

The above information has been taken from the FDD of Papa Murphy's. Year of FDD: 2016

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