Pita Pit
Date of Incorporation: 1999
Franchising Since: 1999
U.S. Headquarters: Delaware
Country of Origin: Canada
Description: The franchisor offers and sells franchises for the Pita Pit business concept which involves a marketing plan and system for the development, opening and operating of retail outlets specializing in the sale of pita sandwiches.
Franchise Offer: The franchisor offers qualified purchasers the right to establish and operate, from a single location, a retail outlet specializing in the sale of pita sandwiches. The franchisee may, also offer the Pita Pit’s line of smoothie products. The franchisor also offers qualified franchisees in certain areas the right to develop multiple restaurants within a designated geographic zone within a specified period of time.
Financial Assistance: The Pita Pit may refer the franchisee to unaffiliated financing companies. The Pita Pit’s franchise system has been pre-approved by the United States Small Business Administration who may at their discretion provide the franchisee with a loan guaranty. The Pita Pit offers some indirect financing.
Training and Assistance: Unless the franchisor decides that the franchisee does not require training, provides a training program concerning the operation of the restaurant consisting of approximately 10 business days of training. The franchisee and each of the staff must attend the training sessions.
Territory: The franchisee will be granted a territory delineated by a specific geographic boundary. Generally, the territory is a 1/4 mile radius around the restaurant but may vary depending on population density or market considerations. Pita Pit will refrain from operating or granting franchises to operate a restaurant utilizing the system at a location within that territory, except that the franchisor may establish a corporate owned or franchised restaurant at any any facility where the owner or operator wants designated food services for those people who reside, work, attend and/or visit at the facility, including, without limitation shopping centers, office complexes, and universities.
Term of Agreement and Renewal: Term is equal to the earlier of 10 years or the expiration of the franchisee’s lease or sublease. One renewal term equal to the earlier of 10 years or the expiration of the franchisee’s lease or sublease. The franchisee must notify Pita Pit 6 months prior to expiration of the initial term and not be in default of the franchise agreement, lease or sublease.
Obligations and Restrictions: The franchise agreement provides that the franchisee will devote his or her full time, attention, energy and best efforts to the management and operation of the restaurant, subject to the employment of competent professional management in the franchisor’s opinion. All managers must sign a confidentiality agreement. The franchisee may only sell products and services that Pita Pit has approved.
Total Number of Units: 302 units.
Investment Tables:
Initial Investment:
| Name of Fee | Low | High |
|---|---|---|
| Initial Franchise Fee | $25,000 | $25,000 |
| Initial Rent & Security Deposit | $2,400 | $10,000 |
| Opening Cash | $500 | $1,000 |
| Leasehold Improvements | $85,500 | $182,800 |
| Business License | $200 | $2,500 |
| Insurance | $1,500 | $4,500 |
| Initial Start-Up Print Pkg. | $1,500 | $2,000 |
| Legal & Accounting Fees | $500 | $2,500 |
| Initial Furniture, Fixture, Equipment Package | $73,535 | $87,600 |
| Opening Advertisement | $500 | $1,000 |
| Staff and Management Training Expense | $1,000 | $3,200 |
| Uniforms | $1,000 | $1,500 |
| Initial Inventory Package | $2,500 | $2,500 |
| Addtional Funds (for 3 months) | $25,050 | $30,900 |
| Totals | $220,685 | $357,000 |
Ongoing Fees:
| NAME OF FEE | AMOUNT |
|---|---|
| Continuing Fee | 6% of total Gross Sales and Renewal term - the Continuing Fee for the final year of the Initial Term of the then current form of Franchise Agreement for new franchisees |
| General Advertising Fund | Up to 2% of total Gross Sales as dictated by Pita Pit |
| Transfer Fee | $7,000 plus Pita Pit’s costs |
| Additional Operating Assistance | If Pita Pit determines that the franchisee requires additional assistance, the franchisee will have to pay the employees' training expenses and may have to pay Pita Pit a fee of up to $2,500 |
| Audit | Cost of Audit including all costs of auditor and of Pita Pit’s employees |
| Indemnification | All liability, damages and costs, including lawyers fees, incurred |
| Online Ordering Service Fee | $395 per year |
| Premises Design and Construction | Varies depending on Head Lease. Historically between $0 and $20,000 |
| Renewal Fee | $25,000 |
| Taxes on Fees | Varies by State |
| Late Payments | Interest at 5% above highest domestic prime rate |
| NSF Fee | $100 |
| Lost Owner's Manual | $1,000 |
Date of FDD: 2009
The above information has been taken from the UFOC/FDD and online sources of The Pita Pit.
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