THE COLONY Texas Amid a growing number of franchisee-incentive programs in the pizza segment, Pizza Inn said Monday it was renewing a program that led to 13 new development agreements in the first six months of the year.
The 300-unit Pizza Inn said the program is being offering now through March 31, 2010, and is available only for new construction of the company’s buffet concept. The incentive program offers a 50-percent reduction in the initial franchise fee, to $12,500 from $25,000; and a 50-percent reduction in royalties in the first and second years, to 2 percent from 4 percent.
"While we are seeing positive signs of growth within our business, the development environment is still difficult for franchisees wanting to expand their business portfolios,” said Charlie Morrison, chief executive of Pizza Inn. “This incentive will allow us to aggressively recruit new candidates to become Pizza Inn franchisees while offering additional incentives to current franchisees looking to continue or re-energize their growth plans.”
As the credit market remains tight, several pizza franchisors, from regional players to national chain, have developed incentive programs to help franchisees and spur growth.
Papa John’s International Inc. of Louisville, Ky., is offering its “25th Anniversary Development Incentive Program” through Dec. 27, which waives the $25,000 franchise fee as well as royalties for 12 months. The program also offers a $10,000 early opening award.
Marco's Franchising LLC of Toledo, Ohio, which has more than 190 stores in 17 states, this summer began assisting potential and existing franchisees with store down payments through a private-equity fund that could invest $50,000 to $100,000 per store and another fund that could help finance construction costs.
Domino’s Pizza of Ann Arbor, Mich., offers such incentives as waiving advertising and royalty fees. RedBrick Pizza Worldwide Inc. of Palmdale, Calif., offers master developers interest-free financing for much or all of their fee, depending on credit worthiness. CiCi's Enterprises LP of Coppell, Texas, this year is waiving franchise fees for existing franchisees or managers who take over struggling stores.
Madison Jobe, vice president of development for Pizza Inn, said the chain's franchisee incentives are aimed at operators looking to expand their restaurant portfolios.
“Despite the current economic climate, there are franchisees seeking opportunities outside or within their current concepts,” he said.