The Papa John's franchise requires a total investment of $261K – $853K with a 6.0% royalty fee and operates 3,291 units in the QSR category. This report analyzes the full Franchise Disclosure Document including unit economics, fee structure, growth trends, and risk indicators to help you evaluate the cost of investing in Papa John's.
Critical issues identified from FDD analysis that warrant serious consideration before investing.
Composite quality score based on growth, stability, efficiency, fees, transparency, and system size.
Estimated initial investment range as disclosed in the most recent FDD.
| Line Item | Low Estimate | High Estimate |
|---|---|---|
| Franchise Fee | $5,000 | $25,000 |
| Other | $1,050 | $1,050 |
| Buildout | $102,000 | $365,000 |
| Equipment | $77,000 | $239,000 |
| Technology | $20,000 | $30,000 |
| Other | $2,500 | $2,500 |
| Technology | $2,000 | $5,000 |
| Technology | $240 | $240 |
| Technology | $1,125 | $1,125 |
| Signage | $7,300 | $35,000 |
| Other | $950 | $950 |
| Real Estate | $2,500 | $8,500 |
| Insurance | $2,500 | $10,000 |
| Inventory | $6,000 | $15,000 |
| Other | $5,000 | $10,000 |
| Training | $1,000 | $30,000 |
| Other | $5,000 | $25,000 |
| Working Capital | $20,000 | $50,000 |
| Total | $261,165 | $853,365 |
Ongoing fees as disclosed in the FDD.
| Fee Type | Rate | Type | Basis | Frequency |
|---|---|---|---|---|
| Royalty - Traditional Restaurant | 5.0% | PCT | Net Sales | monthly |
| Royalty - Non-Traditional Restaurant | 5.0% | PCT | Net Sales | monthly |
| Royalty - Small-Town Restaurant | 6.0% | PCT | Net Sales | monthly |
| Digital Fee | 2.0% | PCT | Net Sales via Digital/Internet on-line ordering including aggregator orders | monthly |
| Transfer | $4,000 | FIXED | Per transfer | one_time |
| Renewal - Traditional Restaurant | $4,000 | FIXED | Per renewal | one_time |
| Renewal - Non-Traditional Restaurant and Small-Town Restaurant | $1,000 | FIXED | Per renewal | one_time |
| Audit Expenses | N/A | VARIABLE | Cost of audit plus understatement plus 12% interest per annum | one_time |
| Interest | 12.0% | PCT | Per annum on unpaid amounts | ongoing |
| Management Fee | $200 | FIXED | Per diem plus compensation, travel and living expenses | one_time |
| Costs, Attorneys' Fees and Pre-judgment Interest | N/A | VARIABLE | As incurred | one_time |
| Indemnification | N/A | VARIABLE | As incurred | one_time |
| Marketing Fund Contributions - Traditional Restaurant | 6.0% | PCT | Net Sales | monthly |
| Marketing Fund Contributions - Non-Traditional Restaurant and Small-Town Restaurant | 1.5% | PCT | Net Sales | monthly |
| Papa Card Transaction and IVR Fees | 2.0% | PCT | Papa Card redemption transactions | monthly |
| Cooperative Contributions | N/A | VARIABLE | Amount determined by Cooperative member vote | monthly |
| Local Advertising | N/A | VARIABLE | Discretionary | ongoing |
| On-Site Installation and Support Fee | $2,200 | FIXED | Per standard 2-day installation | one_time |
| Software Maintenance Fee | $375 | FIXED | Per month | monthly |
| Help Desk Service Fee | $80 | FIXED | Per month | monthly |
| Required Purchases | N/A | VARIABLE | Will vary under circumstances | ongoing |
| Training Fees | $150 | FIXED | Per year per Restaurant | annually |
| Alternative Supplier Fees | N/A | VARIABLE | Reasonable cost of inspection and actual cost of test | one_time |
| Liquidated Damages | N/A | VARIABLE | Average royalty for twelve (12) month period preceding termination or breach multiplied by twenty-four (24) | one_time |
Financial Performance Representations not disclosed by this franchisor
Approximately 40% of franchisors choose not to include Item 19 financial performance data in their FDD. This does not necessarily indicate poor performance -- it simply means the franchisor has elected not to disclose this information.
Model your personal financial scenario by adjusting the assumptions below.
Automated risk indicators based on FDD data analysis.
Franchise unit trajectory based on FDD Item 20 data.
| Year | Start | Opened | Closed | Transferred | End | Closure Rate | Net Growth |
|---|---|---|---|---|---|---|---|
| 2022 | 2564 | +145 | -49 | 252 | 2658 | 1.9% | +94 |
| 2023 | 2658 | +73 | -32 | 74 | 2689 | 1.2% | +31 |
| 2024 | 2689 | +90 | -- | 106 | 2752 | -- | +63 |
How Papa John's compares to peer brands in the QSR category.
Ratio = Investment midpoint ÷ median annual revenue. Lower is better. A 0.5x ratio means the initial investment equals half of one year's gross revenue. Does not account for operating costs, margins, or time value of money.
| Brand | Total Units | Investment Range | Median Revenue | Royalty | Inv/Rev Ratio |
|---|---|---|---|---|---|
| Subway | 19502 | $3K – $630K | No Item 19 | -- | -- |
| McDonald's | 12772 | $1.47M – $2.64M | No Item 19 | 5.0% | -- |
| Dunkin' | 8499 | $527K – $1.83M | $1.43M | -- | 0.8x |
| Domino's Pizza | 7043 | -- | $24K | 5.5% | -- |
| Burger King | 6701 | -- | No Item 19 | -- | -- |
| Wendy's | 5552 | $393K – $2.99M | $2.23M | 4.0% | 0.8x |
| Little Caesars | 3705 | $446K – $1.82M | No Item 19 | 6.0% | -- |
| KFC | 3558 | $135K – $3.77M | $1.27M | 5.0% | 1.5x |
| Papa John's | 3291 | $261K – $853K | No Item 19 | 5.0% | -- |
| Popeyes Louisiana Kitchen | 3177 | $505K – $3.92M | No Item 19 | 5.0% | -- |
Other franchise brands with similar characteristics you may want to consider.