Happy Joes
Happy Joes offers family-friendly restaurants with pizza, ice cream, and breakfast foods in a fun atmosphere. Known for casual dining and franchising opportunities, it operates in the quick-service restaurant sector.
About Happy Joes
Happy Joe's is an American pizza parlor chain based in Bettendorf, Iowa. The restaurant chain was founded in 1972 by Lawrence Joseph "Happy Joe" Whitty, a former Shakey's Pizza manager. Their United States locations are spread out across the Upper Midwest and Arizona, with 6 locations in Egypt, the first of which opened in October 2022.
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Happy Joes franchise FAQ
How much does it cost to open one — the total initial investment?
The total initial investment necessary to begin operation of a Happy Joe's Full-Size Restaurant ranges from $546,693 to $1,358,853. For a Happy Joe's DELCO Facility, the range is from $322,862 to $780,137. This includes a mandatory payment of $30,000 to $40,000 to the franchisor or an affiliate. [p.1]
What is the initial franchise fee?
The initial franchise fee varies based on certain conditions. For standard new franchisees, it is $40,000 [p.11]. However, for Legacy Franchisees signing a new agreement after an existing one expires, or those qualifying for a special incentive program, the fee is $30,000 [p.177; p.11]. This isn't specified in the excerpts.
What are the ongoing royalty and advertising fees?
The ongoing royalty fee is 1.8% of Gross Sales [p.70], and there is also a requirement to contribute to the Advertising Fund at a rate between 1% and 2% of Gross Sales, with 1.8% applicable on the Effective Date [p.70]. These fees are in addition to any other payments due to Franchisor, such as Royalty Fees, advertising contributions, and other amounts owed [p.71].
How long is the initial franchise agreement, and can I renew it?
The initial franchise agreement is for an unspecified term that expires on a date to be filled in by the parties [p.169]. You have the option to renew the franchise for an additional ten years if certain conditions are met at the end of each term [p.169, p.64].
Can I sell or transfer my franchise, and what does that require?
According to the FDD, a franchisor can refuse a transfer of ownership of a franchise except for good cause [p.5]. Good cause includes but is not limited to unspecified factors. Therefore, you cannot freely sell or transfer your franchise without the franchisor's approval, which may be granted or denied based on their discretion and the stated reasons for refusal.
On what grounds can the franchisor terminate the agreement?
The franchisor can terminate the agreement if there is a failure by the franchisee to comply with lawful provisions of the franchise agreement and such failure is not cured within 30 days after being given written notice [p.5]. This includes non-payment of sums due to the franchisor [p.5] (iv).
What financial requirements — net worth and liquid capital — do I need to qualify?
This isn't specified in the excerpts.
Do I get an exclusive or protected territory?
Yes, you will receive a protected area. This protected area will vary in size based on factors such as population density and the location of other Happy Joe's Restaurants [p.28]. However, Franchisor retains the right to grant franchises outside your Protected Area [p.29].
What training and ongoing support does the franchisor provide?
The franchisor provides initial training that includes classroom sessions and on-the-job training using manuals such as the Food and Beverage Manual, Accounting Manual, Certified Pizza Artist Training Manual, Certified Service Artist Training Manual, and Certified Delivery Driver Manual. Additionally, they offer an online training system called 'Stella' which can be accessed via a computer with high-speed internet access [p.26, p.27]. For ongoing support, the franchisor requires franchisees to maintain access to their on-line training system and complete training modules as per their standards [p.31, p.67]. They also may provide refresher training programs at their discretion, but attendance is not mandatory beyond three programs a year [p.67]. The franchisor does not offer ongoing maintenance or repair services for the computer systems; these are provided on a fee-for-service basis by an affiliate [p.26].
How many franchised outlets are there, and how many have closed or been terminated?
This isn't specified in the excerpts.
Does the franchisor share any financial performance or earnings information?
The franchisor may provide financial performance information if there is a reasonable basis for it and it is included in the disclosure document [p.39]. However, they do not make representations about future financial performance or past performance of company-owned or franchised outlets except when providing records of an existing outlet being considered for purchase [p.42].
What am I restricted to selling, and where must I buy supplies?
You are required to offer and sell only those goods and services that the franchisor has approved for sale [p.31]. Additionally, while you have some flexibility in sourcing items not specifically required from designated suppliers or the Approved Supplies List, all inventory, products, supplies, and other items used in Restaurant operations must conform to the franchisor's specifications and quality standards [p.20]. This isn't specified in the excerpts for where you must buy supplies; however, you may have to purchase or lease certain items from the franchisor or a limited group of suppliers they designate, which might be more expensive than other options [p.3].