Paciugo Franchise in 2024: Costs, Fee & FDD
Discover the ins and outs of investing in a Paciugo Gelato & Caffè franchise. Learn about costs, potential earnings, and key insights to help you decide if this high-quality, artisanal gelato brand is right for you.
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Paciugo Gelato & Caffè was founded by Ugo Ginatta, Cristiana Ginatta, and Vincenzo Ginatta in 2000. Originating from Dallas, Texas, Paciugo has made a significant mark in the dessert industry with its authentic Italian gelato. The founders brought their passion for traditional gelato-making from Turin, Italy, and have since created a beloved brand known for its high-quality, artisanal products.
Paciugo’s core products include a wide variety of gelato flavors, made fresh daily using only the finest ingredients from around the world. They also offer sorbetto, coffee, and other Italian-inspired desserts. The franchise caters to a diverse customer base, including families, young professionals, and dessert enthusiasts looking for a premium, authentic gelato experience.
Currently, Paciugo has expanded to over 20 locations across the United States. This growth reflects the brand’s popularity and the increasing demand for high-quality gelato. Each location serves a steady stream of customers daily, contributing to the franchise’s robust market presence.
Paciugo provides strong support to its franchisees, including comprehensive training programs that cover everything from gelato-making techniques to customer service and business operations. Franchisees benefit from ongoing operational assistance, marketing support, and a flexible store format that can range from small kiosks to full-sized caffès. This support system ensures that franchisees are well-equipped to succeed and grow their businesses.
Paciugo Franchise Insights
- Paciugo offers over 300 gelato recipes that rotate seasonally, ensuring a diverse and exciting menu for customers.
- With 24 locations across the United States and the US Virgin Islands, Paciugo has a robust market presence.
- The franchise uses imported Italian ingredients and machinery to maintain the authenticity and quality of their gelato.
- Paciugo locations range from small kiosks to full-sized caffès, allowing franchisees to choose a format that best suits their market.
- The franchise has a significant risk factor with a three-year failure rate of 34%, which potential investors should carefully consider.
Paciugo Franchise Key indicators
Growth YOY (%)
–4%
vs industry 1%
Total U.S. Franchised Units
24
3-Year Failure Rate
34%
vs industry 10%
How much does it cost to open a Paciugo franchise?
Understanding the potential investment size and capital requirements is crucial when considering opening a Paciugo franchise. These financial commitments, including initial franchise fees, equipment costs, and ongoing operational expenses, impact the feasibility and profitability of the venture. Thoroughly evaluating these factors ensures that potential franchisees are prepared for the financial responsibilities and can make informed decisions about their ability to sustain and grow the business, ultimately contributing to long-term success.
Min & Max Investment
Opening a Paciugo franchise involves several key costs, which are outlined in Item 7 of the Franchise Disclosure Document (FDD). you can see a breakdown of the costs to open a Paciugo below from the most recent Item 7 below:
| Type of Expenditure | Minimum Investment | Maximum Investment |
|---|---|---|
| Initial Franchise Fee | $15,000 | $20,000 |
| Initial Application and Document Preparation Fee | $250 | $750 |
| Site Selection Assistance | $0 | $1,000 |
| First Month's Rent and Security Deposit | $2,000 | $10,000 |
| Leasehold Improvements | $73,000 | $306,000 |
| Store Design Consulting Services | $0 | $1,500 |
| Furniture, Fixtures, Equipment, and Signage | $115,000 | $198,000 |
| Initial Training Costs | $500 | $4,000 |
| Pre-Opening Consultation | $0 | $1,000 |
| Opening Assistance Costs | $0 | $5,000 |
| Computer Hardware and Software | $4,000 | $8,000 |
| Initial Inventory/Supplies | $8,000 | $10,000 |
| Professional Services | $1,200 | $4,000 |
| Opening Advertising Expenses | $3,500 | $10,000 |
| Insurance | $250 | $3,000 |
| Additional Funds (Three Months) | $10,000 | $30,000 |
| TOTAL | $232,700 | $612,250 |
Item 7 in the Franchise Disclosure Document (FDD) is the “Estimated Initial Investment” section. It outlines the total costs a franchisee can expect to incur when starting a franchise, including the initial franchise fee, equipment, inventory, real estate, and other startup expenses. This section is crucial because it provides potential franchisees with a detailed understanding of the financial commitment required, helping them assess affordability and plan their investment strategy effectively.
Required Capital
To open a Paciugo franchise, the required capital involves both the initial investment costs and a net worth requirement set by Paciugo. Let’s take a closer look below:
- Initial Investment As shown above, the total estimated initial investment ranges from $232,700 to $612,250. This includes all the startup costs such as the franchise fee, real estate, construction, equipment, initial inventory, and additional funds for initial operating expenses. Assuming that you will finance your franchise investment, you should plan to have 20% of the total investment amount in the form of equity (cash) for the investment.
- Liquid Assets Requirement Paciugo typically requires franchisees to have a minimum of $100,000 in liquid assets. This ensures the franchisee has sufficient funds to cover unforeseen expenses and maintain financial stability during the startup phase.
- Net Worth Requirement Paciugo also assesses the overall net worth of the franchisee. While the specific net worth requirement can vary, it is generally recommended that franchisees have a minimum net worth of $100,000.
How much does a Paciugo franchise owner make?
Calculating the salary of a Paciugo franchise owner involves analyzing gross sales to determine total revenue, assessing operational efficiency to understand profit margins, and accounting for franchisor fees and additional expenses such as rent, utilities, and payroll. Effective management of these factors can significantly impact the profitability and financial success of a Paciugo franchise owner. This comprehensive financial analysis helps estimate net profits, from which the owner’s salary can be derived. A clear understanding of these factors ensures accurate salary projections and financial planning for sustainable business operations.
Paciugo Revenue & Gross Sales
Paciugo Gelato & Caffè franchises have shown promising performance recently. While specific median gross sales figures aren’t readily available, the franchise has been expanding steadily, indicating healthy sales and customer interest. The brand’s focus on high-quality gelato and a unique café experience has helped it maintain a competitive edge in the dessert franchise market.
Which key factors impact the average revenue performance of Paciugo franchisees?
Several factors likely contributed to the performance of Paciugo Gelato & Caffè franchisee median gross sales this past year. The increasing popularity of artisanal and high-quality desserts has driven more customers to seek out unique offerings like gelato. Additionally, Paciugo’s focus on seasonal and diverse flavors keeps the menu fresh and appealing. Effective marketing strategies and strong community engagement have also played a role in attracting and retaining customers. Lastly, the overall economic recovery and increased consumer spending on dining out have positively impacted sales
Paciugo Franchise Operational Costs
When operating a Paciugo Gelato & Caffè franchise, you’ll need to consider several key ongoing operational costs. These include:
- Ingredients and Supplies Regular purchases of high-quality ingredients like milk, fruits, chocolates, and nuts for gelato production.
- Labor Costs Wages for staff, including baristas, servers, and kitchen personnel.
- Utilities Costs for electricity, water, and gas to keep the store running smoothly.
- Maintenance and Repairs Upkeep of equipment and the store itself to ensure everything remains in good working order.
- Rent and Lease Payments Monthly payments for the retail space where your franchise is located.
These costs are essential to maintaining the quality and efficiency of your Paciugo Gelato & Caffè franchise.
Paciugo Franchise Fees
When considering the ongoing fees for a Paciugo Gelato & Caffè franchise, it’s important to be aware of the following:
- Royalty Fee 6% of Gross Sales, payable weekly. This fee covers the ongoing support and services provided by the franchisor, including training, operational assistance, and access to proprietary systems.
- Brand Development Fund Contribution 2% of Gross Sales, payable weekly. This contribution supports national and regional marketing efforts, helping to build brand awareness and drive customer traffic to your location.
- Additional Fees There might be additional fees for specific services or support, such as technology upgrades, special training programs, or participation in promotional campaigns.
These fees are crucial for maintaining the brand’s quality and support network, ensuring your franchise operates smoothly and successfully.
Paciugo Franchise Earnings
While specific earnings figures for Paciugo Gelato & Caffè franchises aren’t readily available, we can discuss general performance trends. Typically, dessert franchises like Paciugo benefit from high margins on products such as gelato, which can contribute to healthy earnings for owner-operators. The focus on artisanal, high-quality ingredients and unique flavors helps attract a loyal customer base, driving consistent sales.
Owner-operators often see better profitability due to their hands-on management style, which can reduce labor costs and improve operational efficiency. Additionally, effective local marketing and community engagement can further boost sales and profitability.
How to Open a Paciugo Franchise
Becoming a Paciugo Gelato & Caffè franchisee involves several key steps, starting from your initial inquiry to the grand opening of your store. Here’s an overview of the process:
- Initial Inquiry You or your franchise specialist submits an initial inquiry basic information about your interest and background. You should also conduct thorough research on the franchise, including seeing all of the information available on the Vetted Biz franchise intelligence platform, including access to the most recent Franchise Disclosure Document (FDD).
- Application Submission Complete and submit a formal franchise application, which will be reviewed by the Paciugo development team.
- Discovery Day Attend a Discovery Day at Paciugo’s headquarters to meet the team, learn more about the business, and ask any questions you may have.
- Approval and Agreement If approved, you’ll sign the franchise agreement and pay the initial franchise fee.
- Site Selection and Lease Negotiation Work with Paciugo to select a suitable location and negotiate the lease terms.
- Training Program Participate in a comprehensive training program covering operations, marketing, and management.
- Store Build-Out Oversee the construction and setup of your store, following Paciugo’s design and operational standards.
- Pre-Opening Support Receive support from Paciugo’s team to prepare for your grand opening, including marketing and staff training.
- Grand Opening Launch your Paciugo Gelato & Caffè franchise and start serving customers.
Pros & Cons
Pros
High-Quality Product: Paciugo is known for its artisanal gelato made with high-quality ingredients, which attracts a loyal customer base.
Simple Operations: The business model is straightforward and easy to learn, making it accessible even for those new to the food industry.
Growing Market: The popularity of gelato is increasing in the U.S., offering growth potential in an under-penetrated market.
Cons
High Failure Rate: The franchise has a high three-year failure rate of 34%, which is a significant risk factor to consider.
Location Sensitivity: The success of the franchise can be highly dependent on the store’s location, with high foot traffic areas being crucial.
Weather Impact: Sales can be affected by weather conditions, with potentially lower sales on colder or rainy days.
Market Familiarity: While growing, gelato is still less familiar to some American consumers compared to traditional ice cream.
