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Mr. Gatti's Pizza Franchise ProfileEntertainment Franchises > Family Entertainment Centers |
What is the Initial Investment for a Mr. Gatti's Pizza Franchise?
To open a Mr. Gatti's Pizza franchise, you will need to prepare for an initial investment ranging from $2,185,973 to $3,660,900. This amount includes a franchise fee of $50,000, along with other startup costs. Additionally, you should have a cash requirement in the same range as the total investment and a net worth between $500,000 and $1,000,000 to qualify for ownership.
What Are the Financial Performance Metrics for Mr. Gatti's Pizza?
Mr. Gatti's Pizza franchises show promising financial performance, with an average annual revenue of approximately $2,708,620.86 per unit. The cost of goods sold (COGS) accounts for about 22.41% of revenue, resulting in a gross profit margin of 77.59%. Operating expenses are significant, totaling around $1,350,000 annually, but this still leaves franchisees with an EBITDA margin of 27.76%, indicating healthy profitability potential.
What Are the Ongoing Fees Associated with Mr. Gatti's Pizza?
Owning a Mr. Gatti's Pizza franchise comes with ongoing fees that include a royalty fee of 5% of gross sales and a marketing fee of 2%. These fees are essential for maintaining brand presence and supporting marketing efforts. It's important to factor these costs into your financial planning to ensure sustainable profitability as you operate your franchise.
What is the Growth Trend for Mr. Gatti's Pizza Franchises?
Mr. Gatti's Pizza has shown a steady growth trend over recent years. In 2020, there were 48 franchised units, which slightly decreased to 47 in 2021, before rising again to 49 in 2022. This indicates a resilient brand presence and potential for further expansion. The franchise's ability to maintain a consistent number of units, alongside a single corporate unit, suggests stability and a solid foundation for future growth opportunities.
Mr. Gatti's Pizza Franchise Financial Requirements
Below, you’ll find an overview of the initial investment needed to launch the business, along with the ongoing fees required by the franchisor to maintain operations over time.
The minimum total assets (minus liabilities) you must possess.
Net Worth Required:
The estimated period to recoup your total investment.
Investment Payback:
The initial fee paid to join the franchise system.
Franchise Fee:
Ongoing percentage of revenue paid to the franchisor.
Royalty Fee:
Regular contribution toward the franchise’s advertising fund.
Marketing Fee:
The estimated timeframe to recover your initial costs.
Breakeven Time:
The total amount required to launch the franchise.
Initial Investment:
The minimum liquid capital you must have on hand.
Cash Required:
The typical yearly revenue generated per franchise location.
Average Revenue:
The middle value of yearly revenue among franchise locations.
Median Revenue:
The largest reported annual revenue among franchisees.
Highest Revenue:
The smallest reported annual revenue among franchisees.
Lowest Revenue:
A broad sector defining similar types of franchise businesses.
Industry:
A more specific division within the broader industry.
Category:
The key individuals guiding the franchise’s strategy and growth.
Leadership:
The official business address of the franchisor’s headquarters.
Corporate Address:
Available financing options to help start the franchise.
Funding Year:
The main organization that owns the franchise brand.
Parent Company:
Mr. Gatti's Pizza Franchise Unit Growth Summary
A breakdown of corporate, franchised, and total units, with yearly net changes.
Total Units
Franchised Units
Corporate Units
| Units | 2020 | 2021 | 2022 |
|---|---|---|---|
| Total Units | 49 | 48 | 50 |
| Net Change YoY | -1 | 2 | |
| Franchised Units | 48 | 47 | 49 |
| Net Change YoY | -1 | 2 | |
| Corporate Units | 1 | 1 | 1 |
| Net Change YoY | 0 | 0 |
Investment Overview
The initial investment to open a Mr. Gatti's Pizza franchise ranges from $2,185,973 to $3,660,900. This includes a franchise fee of $50,000. Prospective franchisees should be prepared for ongoing royalty fees of 5% of gross sales and a marketing fee of 2%. A solid financial foundation is essential, with a net worth requirement between $500,000 and $1,000,000.
Financial Performance
Mr. Gatti's Pizza franchises report an average annual revenue of approximately $2,708,620.86, with a median annual revenue of $2,504,505. Revenue can vary significantly, ranging from as low as $717,819 to as high as $5,093,470 per unit. Franchisees can expect to break even within 12 months and achieve a return on investment in about 30 months.
Franchise Growth
The Mr. Gatti's Pizza franchise system has shown steady growth, with the number of franchised units remaining relatively stable over the past three years. In 2020, there were 48 franchised units, decreasing to 47 in 2021, and slightly increasing to 49 in 2022. The brand also maintains one corporate-owned unit throughout these years.
Operational Expenses
Average operating expenses for a Mr. Gatti's Pizza unit total around $6,498,628 annually. Key expenses include store payroll and benefits at $736,690, and non-store operating payroll and benefits at $2,307,032. Additionally, franchise-related general and administrative expenses account for $1,938,859, highlighting the importance of efficient cost management.
Profitability Metrics
The gross profit margin for Mr. Gatti's Pizza franchises stands at 77.59%, with a cost of goods sold (COGS) of $606,579. After accounting for operating expenses of approximately $1,350,000, the average EBITDA is about $752,041.86, representing 27.76% of total revenue, indicating strong profitability potential for franchisees.
Brand Commitment
Mr. Gatti's Pizza is dedicated to delivering high-quality, family-friendly dining experiences with a focus on delicious, freshly made pizza. The brand emphasizes community engagement and customer satisfaction, aiming to create a welcoming atmosphere where families can enjoy a meal together. This commitment to quality and service helps build customer loyalty and drive repeat business.
Frequently Asked Questions
The initial investment for a Mr. Gatti's Pizza franchise ranges from approximately $2,185,973 to $3,660,900. This includes the franchise fee, equipment, and other startup costs.