Pops Italian Beef
Pop's Italian Beef & Sausage offers family-oriented restaurants serving classic Chicago-style Italian beef sandwiches and other specialties. Known for its hearty beef sandwiches, this franchise operates in the quick-service restaurant sector.
Pops Italian Beef franchise FAQ
How much does it cost to open one — the total initial investment?
The total initial investment necessary to begin operation of a franchised Pop's Italian Beef & Sausage restaurant ranges from $577,200 to $1,228,000 [p.1]. This includes an initial franchise fee of $25,000 that must be paid to the franchisor or an affiliate [p.14].
What is the initial franchise fee?
The initial franchise fee is $25,000 [p.10]. This fee is fully earned when paid and is not refundable under any circumstances [p.10].
What are the ongoing royalty and advertising fees?
Ongoing royalty fees range from 2% to 3% of gross restaurant sales [p.120]. There is no specific mention of advertising fees in the provided excerpts, so this isn't specified in the excerpts.
How long is the initial franchise agreement, and can I renew it?
The initial franchise term is ten years [p.131, p.141, p.120]. Subject to the company's approval, a franchisee may generally renew the franchise for two additional terms of five years each [p.57].
Can I sell or transfer my franchise, and what does that require?
According to the FDD, if you wish to transfer your Pop's Italian Beef & Sausage Restaurant franchise, whether to an existing or new franchisee, you must pay a transfer fee. For an existing franchisee, this fee is 50% of the current initial franchise fee, and for a new franchisee, it is 75%. The franchisor has the option but not the obligation to purchase your restaurant upon termination or expiration of the franchise agreement at fair market value. This process involves selecting independent appraisers to determine the asset values if an agreement cannot be reached on the fair market value. [p.76] [p.81]
On what grounds can the franchisor terminate the agreement?
The franchisor can terminate the agreement if you have not located an acceptable site or signed the lease, sublease, or other related documents for an acceptable site within 90 days from the date of the Franchise Agreement [p.25]. Additionally, the franchisor has the right to terminate the Marketing Fund by giving you thirty (30) days' prior written notice [p.72], and this termination could lead to the potential reinstatement of the Marketing Fund under similar terms [p.72]. This isn't specified in the excerpts for other grounds of termination.
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 are granted a protected area (the 'Protected Area'), which is typically a radius of 5 miles in most areas. This can be larger if the area does not include at least 125,000 people, and it may also be defined by street boundaries or other similar descriptions [p.26]. However, this protected area does not provide an exclusive territory; you may face competition from other franchisees, company-owned outlets, or other channels of distribution within your Protected Area [p.26].
What training and ongoing support does the franchisor provide?
The franchisor provides initial training for the franchisee and their management team at a designated facility or location, which includes restaurant operations training. There is no separate charge for this training. Ongoing support involves disclosing confidential information through the Operations Manual and guidance during the term of the franchise. [p.60, p.39]
How many franchised outlets are there, and how many have closed or been terminated?
There are currently 17 franchised outlets in operation [p.7]. This excerpt does not specify the number of closed or terminated franchises, so this isn't specified in the excerpts.
Does the franchisor share any financial performance or earnings information?
The franchisor can provide actual records of an existing outlet if you are considering purchasing one. Otherwise, they do not make representations about future financial performance or past performance of company-owned or franchised outlets [p.39]. If you receive other financial performance information or projections, you should report it to the franchisor and relevant authorities as instructed [p.39].
What am I restricted to selling, and where must I buy supplies?
You are required to offer for sale all menu items prescribed by the franchisor from time to time and sell only approved products and services as designated. You may not sell any menu items or other products or services that have not been approved. As for supplies, you may need to purchase or lease certain items from the franchisor or a limited group of suppliers they designate; these items might be more expensive than those available elsewhere [p.3].