fbpx

Blaze Pizza Franchise Cost, Fee and Total Investment (2020)

Source: 2020 Blaze Pizza Franchise Disclosure Document (FDD)

Blaze Pizza History

Blaze Pizza was founded in 2011 by Rick and Elise Wetzel of Wetzel’s Pretzels. The first location did not open until 2012 in Irvine, California. The Wetzels modeled Blaze Pizza after the Chipotle concept as a made-to-order approach to serving customers. The company’s name comes from the fact that the create-your-own pizzas are “Fast Fire’d” in a high-temperature open-flame oven – an average cook time is 3 minutes. Like Chipotle, Blaze Pizza customers choose what ingredients they want on their pizza while moving down a service line.

Two months after opening the first Blaze Pizza, the Wetzels opened a second, flagship store in Pasadena, California. Franchising started immediately and by the end of 2014, Blaze had become the first fast-casual pizza restaurant to achieve 50 opened units. At that time, the company had commitments with franchise partners to open 343 restaurants in 39 states. Today, there are Blaze Pizza locations across the United States, Canada, Kuwait, Saudi Arabia, Bahrain, and the United Arab Emirates.

Blaze Pizza Update

In early November 2019, Blaze Pizza announced the promotion of Mandy Shaw to president and chief executive officer. Shaw has been with Los Angeles-based Blaze Pizza since 2018 as its chief financial officer, and has also served as interim CEO since August 2019. Shaw has played a critical role in the company’s rapid growth over the past two years.

Rick Wetzel, co-founder of Blaze Pizza, said, “Mandy is stepping into the CEO role with a unique understanding of the brand. Since joining just under two years ago, she has demonstrated a blend of entrepreneurial spirit, brand vision and operational expertise that make her the perfect fit to lead this company.”

Blaze Pizza Initial Franchise Cost

$541,500 to $1,150,500 is an estimate of your initial startup expenses for one Blaze Pizza Franchise. This estimate also includes Non-Traditional Restaurants.

These estimated initial expenses are Blaze Pizza’s best estimate of the costs you may incur in establishing and operating your Blaze Pizza Franchise. Blaze Pizza does not offer direct or indirect financing for these items.

In addition to Blaze Pizza’s experience, the experience of its officers, and its current requirements for Blaze Pizza Franchises, these estimates are based on the historical costs to open Blaze Restaurants during 2019, which, excluding food court locations, averaged approximately $808,000 per Restaurant in 2019.

The estimated initial investment for a Non-Traditional Restaurant, while still within the estimated range set forth above, may be lower than a Traditional Blaze Pizza Restaurant, and these figures represent the approximate cost for purchasing, installing, and equipping the Restaurant.

Because they are typically located in a host facility, Non-Traditional Restaurants may require fewer leasehold improvements and equipment expenditures than Traditional Blaze Pizza Restaurants. Opening inventory expenditures may be lower as well, but the initial investment in a Non-Traditional Restaurant depends on the type, location, and configuration of the Restaurant and of the host facility.

The factors underlying Blaze Pizza’s estimates may vary depending on several variables, and the actual investment you make in developing and opening your Franchise may be greater or less than the estimates given depending upon the location of your Franchise, and current relevant market conditions.

Your costs will also depend on factors such as how well you follow Blaze Pizza’s methods and procedures; your management skills; your business experience and capabilities; local economic conditions; the local market for Blaze Pizza’s products and services; the prevailing wage rates; competition; and sales levels reached during your initial phase of business operations.

All expenses payable to third parties are non-refundable, except as you may arrange for utility deposits and other payments

Initial Franchise Fee, Master Franchise Fee, or Additional Restaurant Fee:  $20,000 to $30,000

The initial franchise fee for one Blaze Pizza Franchise that is a Traditional Restaurant is $30,000.

The franchise fee is paid upon execution of the Franchise Agreement and is non-refundable.

Leasehold Improvements:  $233,000 to $547,000

The typical Blaze Pizza Traditional Restaurant will be approximately 2,200 to 3,000 square feet. A typical Blaze Pizza Non-Traditional Restaurant will be approximately or 1,000 to 1,200 square feet if located in a food court. The Restaurants will most likely be located in retail strip malls, dense urban areas, regional shopping centers, and entertainment and travel centers.

The cost of improvements will vary depending on a number of factors, including:  (i) size and condition of the space; (ii) pre-construction costs; and (iii) cost of materials and labor. This estimate does not include any construction allowances or tenant improvement credits that may be offered by your landlord.

In 2019, the range of these allowances and credits was from $0 to $185,000. If your landlord provides a tenant improvement allowance and you do not experience significant cost over-runs, delays, etc., your actual leasehold improvement costs might be at the lower end of the estimate (although your landlord might incorporate the amount of the tenant improvement allowances into your rent).

Additional Funds – 3 Months:  $20,000 to $45,000

The estimate of additional funds for the initial phase of your business is based on your staff salaries and miscellaneous startup costs operating expenses through the first 3 months of operation. The estimate of additional funds does not include an owner’s salary or draw.

Additional Franchise Costs

  • Architect/Engineer:  $15,000 to $22,500
  • Permits:  $2,100 to $23,000
  • Equipment:  $165,000 to $185,000
  • Furniture and Fixtures:  $21,000 to $102,000
  • Smallwares:  $13,500 to $22,000
  • Signage and Graphics:  $6,500 to $34,500
  • Grand Opening Kit, Menu Boards:  $4,900 to $5,500
  • Computer Equipment and Information/POS Systems:  $14,500 to $25,000
  • Uniforms:  $1,000 to $4,000
  • Initial Inventory and Supplies:  $10,000 to $21,000
  • Pre-Opening Advertising:  $3,000 to $18,000
  • Grand Opening Free Pizzas:  $0 to $6,000
  • Insurance Deposits:  $500 to $3,000
  • First Month’s Rent/Security Deposit:  $5,000 to $24,000
  • Initial Training:  $5,000
  • Liquor Licensing:  $0 to $3,000
  • Miscellaneous Opening Costs:  $500 to $20,000
  • Professional Fees:  $1,000 to $5,000

Blaze Pizza Franchise Costs add to a total of $541,500 to $1,150,500

Ongoing Franchise Costs and Fees

Continuing Royalty:  5% of Gross Sales

Due Date:  Due on Wednesday of each week.

The “Continuing Royalty” is based on “Gross Sales” during the previous week.

“Gross Sales” includes all revenues received or receivable by you as payment, whether in cash or for credit or barter, or other means of exchange (and, if for credit or barter, whether or not payment is received), on account of any and all goods, merchandise, services, or products sold in or from your Restaurant, or which are promoted or sold under any of the trademarks or by using the System.

Gross Sales excludes: (i) sales taxes, value added or other tax, excise, or duty charged to customers, based on sales at or from your Restaurant; (ii) tips, gratuities, or service charges paid directly by customers to your employees or paid to you and promptly turned over to your employees in lieu of direct tips or gratuities; and (iii) proceeds from isolated sales of equipment and trade fixtures which are not part of your products and services offered for resale at your Restaurant nor having any material effect upon the ongoing operation of your Restaurant.

Creative Fund Contribution:  then-current fee (currently, 2% of weekly Gross Sales)

Due Date:  Same as Continuing Royalty.

You must contribute 2% of your Gross Sales to Blaze Pizza’s system-wide “Creative Fund” for its use in developing and building the Blaze Pizza brand (“Creative Fund Contribution”).

Blaze Pizza reserves the right to increase or otherwise modify the Creative Fun Contribution to up to 4% for Traditional Restaurants upon 60 days’ written notice to you.

Local Advertising Payment:  the difference between the amount you spent on local advertising each month and your required local advertising requirement

Due Date:  As incurred.

You are required to spend 2% of your total Gross Sales of the immediately preceding 6-month period on local advertising (“Local Advertising Requirement”).

If you fail to meet your requirement on local advertising during any rolling 6-month period, Blaze Pizza may require that you pay it the difference between the amount you spent and the required advertising expenditure, which will be contributed to the Creative Fund.

Other Ongoing Fees

  • Training Software License and Tablet Lease Fee: currently $120 per month; $600 one-time setup fee
  • Blaze Pizza Certification Training: no charge for initial certifications; Blaze Pizza’s then-current fees for additional certifications or re-certifications (currently $1,000 per person per week plus expenses)
  • Additional Training or Assistance: Blaze Pizza’s then-current charge (currently $500 to $1,500 per week), plus expenses
  • Registration for Annual Convention: between $250 and $500 per attendee
  • Transfer Fee: 50% of Blaze Pizza’s then-current Initial Franchise Fee per Restaurant
  • Transfer to Entity: Blaze Pizza’s actual costs
  • Renewal Fee: 50% of Blaze Pizza’s then-current Initial Franchise Fee or Master Franchise Fee, as applicable; or $15,000 if Blaze Pizza is not then offering franchises for sale
  • Relocation Fee: 50% of Blaze Pizza’s then-current Initial Franchise Fee or Additional Restaurant Fee, as applicable
  • Management Fee: $500 per day per representative, plus expenses
  • Reputation Management Fee: actual costs, currently $38 per month per Restaurant
  • Loyalty Platform Fee: actual costs, currently $120 per month per Restaurant
  • Audit Expenses: cost of audit and inspection, any understated amounts plus Interest, and any related accounting and legal expenses
  • Non-Sufficient Funds Fee: $50 per occurrence
  • Insurance: reimbursement of Blaze Pizza’s costs, plus a 20% administration charge
  • Site Review and Evaluation Fee: actual costs
  • Food Safety Inspection: cost of inspection (estimated to be approximately $400)
  • Rescheduling Expenses: actual costs
  • Supplier and Product Evaluation Fee: costs of inspection (estimated to be approximately $100 to $500)
  • Legal Costs and Professional Fees: will vary under circumstances. You will be required to reimburse Blaze Pizza for any legal or accounting fees that it incurs as a result of any breach or termination of your Franchise Agreement. You must reimburse Blaze Pizza if it is required to incur any expenses in enforcing its rights against you under the Franchise Agreement or MFA
  • Indemnification: will vary under circumstances. You must indemnify and reimburse Blaze Pizza for any expenses or losses that it or its representatives incur related in any way to your Blaze Pizza Restaurant or Franchise
  • Liquidated Damages: will vary under the circumstances
  • Broker Fees:  Blaze Pizza’s actual cost of the brokerage commissions, finder’s fees, or similar charges. If you transfer your Blaze Pizza Restaurant to a third party or purchaser, you must reimburse all of Blaze Pizza’s actual costs for commissions, finder’s fees, and similar charges.

Are you interested in investing in a Food & Beverage Franchise? Download our free brochure today on the healthy food industry!



vetted-biz-cover-food-beverage