Aurelio's Pizza Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$437,904 - $1,252,939
Franchise Fee
$20,000
Total US Locations
36
Business Summary
Aurelio's Is Pizza offers franchises for the operation of pizzerias specializing in the retail sale of pizza, pastas, sandwiches, and liquid refreshments. The company provides franchisees with the right to use its established service marks, trade names, and logos in connection with operating an Aurelio's Is Pizza restaurant.
Corporate History
The Aurelio's Is Pizza business originated in 1957, operating as a partnership under the name Aurelio's Is Pizza restaurant. In 1975, Aurelio Pizza, Inc. was incorporated and has since owned and operated an Aurelio's Is Pizza restaurant, licensing the use of the name and trademarks. The franchisor entity, Aurelio's Is Pizza Franchise, Ltd., was incorporated in Illinois in June 1976. Aurelio's Is Pizza began offering franchises for its pizza restaurants in 1979, making its primary business activity the sale and service of these franchises.
Financial Overview
Investment Range
$437,904 - $1,252,939
Franchise Fee (Low)
$20,000
Franchise Fee (High)
$49,000
Royalty %
5%
Marketing %
2%
Equipment Costs (Low)
$259,000
Equipment Costs (High)
$910,000
Working Capital
$110,000
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Aurelio's Is Pizza Franchise, Ltd. appears to be in a challenging financial position. The company has consistently reported significant operating losses, with a negative operating income of over $1.1 million in 2023. Its consolidated balance sheets show a growing stockholders' deficit, reaching over $4.3 million in 2023 and increasing to over $5.2 million by April 2024. A notable concern is the Illinois Attorney General's requirement for Aurelio's Is Pizza Franchise, Ltd. to place initial franchise fees into an escrow account. This measure was imposed due to an increase in the company's total liabilities relative to its stockholders' equity, indicating financial instability. Additionally, one of Aurelio's Is Pizza Franchise, Ltd.'s controlled restaurant subsidiaries owes a substantial amount (over $1.8 million in 2023) to an affiliated supplier, which the company does not expect to pay within the next year, classifying it as a long-term liability. While the company's franchise operations generate revenue, its restaurant operations consistently incur losses.
Financing Details
Aurelio's Is Pizza Franchise, Ltd. does not offer any direct or indirect financing to its franchisees. This means that Aurelio's Is Pizza Franchise, Ltd. will not provide loans, payment plans, or guarantees for any notes, leases, or other financial obligations associated with the franchised business. Franchisees will need to secure all necessary funding independently from outside sources.
Performance Metrics
Total US Locations
36
Franchised Units
34
Corporate Units
2
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
Aurelio's Is Pizza has no litigation history to report in this document. The franchisor explicitly states in Item 3 that no litigation is required to be disclosed.
Bankruptcy History
Aurelio's Is Pizza reports that there is no bankruptcy history required to be disclosed for the franchisor or its key management personnel.
Agreement Terms
Initial Term
5 years
Renewal Term
5 years
Renewal Conditions
Aurelio's Is Pizza franchisees must meet several conditions for renewal. The Franchisor may choose not to renew if the franchisee has committed any "material breach" of the Franchise Agreement within 12 months prior to expiration. Renewal can also be denied if the franchisee cannot maintain possession of their premises or secure new, approved premises. Franchisees must agree to execute the then-current standard Franchise Agreement and all associated legal documents no later than 30 days before their current agreement expires. They must also update their restaurant to meet Aurelio's Is Pizza's current standards for equipment, signage, and interior/exterior remodeling. Finally, if a franchisee's Quality, Service, and Cleanliness (QSC) performance falls below current standards for two or more inspections during the prior 12-month period, renewal may be denied. No additional initial or renewal franchise fee is payable upon renewal.
Training & Support Program
Franchisor Assistance
Before opening, Aurelio's helps franchisees by providing approved suppliers for specific branded ingredients, soft drinks, and packaging, as well as site location assistance, standard plans, and designs for the restaurant. Aurelio's also furnishes specifications for equipment, fixtures, decor, and smallwares, and approved suppliers for branded decorations, photographs, menus, exterior signage, and employee uniforms. They offer advice on purchasing other merchandise and services, hiring initial staff, and developing a grand opening campaign. Franchisees also receive an operations manual, a basic bookkeeping system, and access to an electronic reporting service. Aurelio's provides comprehensive management training at their Homewood, Illinois training center or a nearby franchised location, covering cooking, food handling, and systems operation, and also conducts employee training at the franchisee's location before opening. After the business opens, Aurelio's provides ongoing approved sources for branded ingredients and POS system software. The franchisor offers consultation and guidance from their home office on business development, operation, and management. Aurelio's ensures ongoing quality assurance through regular inspections and on-location training and assistance. They also provide an internet-based Business Management Portal for communication, news, alerts, and other resources. Aurelio's conducts periodic franchisee meetings and provides additional staff and management training as needed.
Initial Training Hours
100
Training Location
Homewood, IL or a nearby franchised location
Ongoing Support
Aurelio's provides ongoing support by making its home office available for consultation and guidance on business development, operation, and management. Aurelio's offers ongoing quality assurance through regular inspections and on-location training and assistance provided by their franchise directors. Franchisees also gain access to an internet-based Business Management Portal for communication with Aurelio's and other franchisees, and to receive news, product alerts, supplier information, training videos, marketing materials, and sales data. Aurelio's conducts periodic franchisee meetings to discuss industry, brand, and system-related issues. Additionally, Aurelio's provides additional training for staff and management employees as needed.
Franchise Requirements
Ideal Candidate Profile
Aurelio's seeks franchisees who are committed to direct, full-time supervision of their franchised business on its premises. If the franchisee is a corporation or limited liability company, the principal executive officer or member must be in active, full-time charge. While this requirement can be waived, it is only in favor of appointing a full-time, fully trained manager. This indicates a preference for dedicated, hands-on operators or those who will ensure robust, full-time management.
Industry Experience Required
No
Management Experience Required
Yes
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
retail
Owner Participation
Hands-On
Territory Type
Limited
Territory Size Requirements
Aurelio's franchise territories are defined as a radius around the franchised location. This radius is between one and three city blocks if the business is in a central business district, or up to three miles in an outlying residential area.
Staffing Notes
Aurelio's requires franchisees to keep their business adequately staffed with competent employees who are licensed where required by law. All staff must be trained in Aurelio's system regarding food quality and brand presentation, and employees will be cross-trained for multiple job assignments. All employees, including management, must wear uniforms approved by Aurelio's. While Aurelio's provides training on food quality and brand presentation, franchisees are solely responsible for setting other employee standards, including safety and security, and for all hiring, firing, discipline, and daily supervision of their employees.