Risk Score
Pending analysis
Investment Range
$1,001,223 - $1,301,134
Franchise Fee
$30,000
Total US Locations
552
Business Summary
MOD Pizza Restaurants specialize in "made on demand" artisan pizzas, salads, desserts, and various beverages, including wines and beers. These restaurants operate in a unique atmosphere, offering a distinctive dining experience to the general public, primarily during lunch and dinner hours.
Corporate History
The MOD Pizza Restaurant concept was initially founded in February 2008. MOD Super Fast Pizza Franchising, LLC, the entity that grants franchises, was formed in Delaware on July 25, 2013, and began offering franchises for MOD Pizza Restaurants in the same year. This entity operates solely under its own name and focuses exclusively on franchising MOD Pizza Restaurants.
Financial Overview
Investment Range
$1,001,223 - $1,301,134
Franchise Fee (Low)
$30,000
Franchise Fee (High)
$30,000
Royalty %
5%
Marketing %
2.5%
Equipment Costs (Low)
$877,223
Equipment Costs (High)
$1,093,134
Working Capital
$40,000
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Going concern qualification
Financial Health Notes
The independent auditors of MOD Super Fast Pizza Franchising, LLC have identified substantial doubt about the Company's ability to continue as a going concern. This concern stems from its parent company, MOD Super Fast Pizza Holdings, LLC, which reported a net loss of $36.8 million for 2023 and has a working capital deficiency. The auditors note that the parent company's financial conditions and its ability to address its liquidity needs could significantly affect MOD Pizza Franchising, LLC's assets, thus casting substantial doubt on the franchising entity's ability to continue.
Financing Details
MOD Pizza does not offer any direct or indirect financing to its franchisees. Franchisees will need to secure their own funding, as MOD Pizza also does not guarantee any notes, leases, or other obligations.
Performance Metrics
Total US Locations
552
Franchised Units
87
Corporate Units
465
Avg Square Footage
2,750
Franchising Since
2013
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
Yes
Litigation Summary
MOD Pizza has no litigation history to report under Item 3 of its Franchise Disclosure Document. Therefore, MOD Pizza has not been involved in any material legal proceedings.
Bankruptcy History
MOD Pizza's Chief Development Officer, Stephen Blum, was Senior Vice President at The Hertz Corporation from September 2016 to August 2022. The Hertz Corporation and some of its affiliates filed for Chapter 11 bankruptcy reorganization on May 22, 2020. Hertz is not related to MOD Pizza or its restaurant network. The bankruptcy court confirmed Hertz's reorganization plan on June 10, 2021. MOD Pizza itself has no other bankruptcy events to disclose.
Agreement Terms
Initial Term
10 years
Renewal Conditions
To renew their franchise, MOD Pizza franchisees must provide written notice 180 to 365 days before expiration, be in full compliance with their current Franchise Agreement and all monetary obligations, agree to remodel their location to current MOD Pizza image standards, and have the right to occupy their location for at least five additional years. Franchisees must also sign the then-current standard Franchise Agreement, pay a successor fee equal to 30% of the then-current initial franchise fee, execute a general release of claims against MOD Pizza, and ensure their Management Staff completes all required training.
Training & Support Program
Franchisor Assistance
MOD Pizza assists franchisees with pre-opening aspects such as reviewing proposed restaurant sites and providing site design assistance after the franchisee submits site information. MOD Pizza conducts initial training for the MOD Operator and Management Staff, which is free for the first two restaurants opened, with fees applicable for the third and subsequent locations unless the franchisee has certified trainers. The franchisor also provides a Franchise Support Guide and lists of approved suppliers. Once open, MOD Pizza offers ongoing support including additional training (for a fee if required or requested), basic accounting and business procedures, general marketing recommendations, administration of the Marketing Fund, periodic restaurant visits, legal protection of its Marks, advisory services via phone or email, and updates to menus and supplier lists.
Initial Training Hours
208
Training Location
Seattle, Washington or certified training centers
Ongoing Support
After opening, MOD Pizza provides ongoing support services to its franchisees. This includes offering additional training to new Management Staff members or if MOD Pizza deems it necessary, with per diem training fees and travel expenses applicable. The franchisor also makes basic accounting and business procedures available, provides general marketing recommendations, and administers the Marketing Fund. MOD Pizza conducts periodic visits and reviews of restaurants, offers advisory services by telephone, in writing, or email, furnishes sample menu updates, and provides updated lists of approved suppliers. Consultants can be sent to provide training, assistance, or advice on management and operations issues at the franchisee's expense for travel and per diem fees.
Franchise Requirements
Ideal Candidate Profile
MOD Pizza seeks franchisees who will designate a MOD Operator with at least five years of multi-unit restaurant management experience, including profit and loss responsibility for a number of restaurants equal to or greater than the total number of MOD Pizza Restaurants under their development schedule. This individual must devote their full time and best efforts to operating the restaurant. If the franchisee is an entity, its owners must also sign a Non-Disclosure and Noncompetition Agreement, and any owner with at least 10% ownership must sign a personal guaranty.
Industry Experience Required
Yes
Management Experience Required
Yes
Sales Experience Required
No
Technical Skills Required
No
Min Years Experience
5
Operational Details
Location Type
Retail
Owner Participation
Full-Time
Territory Type
Protected
Territory Size Requirements
MOD Pizza defines a franchisee's Protected Area as a designated radius around the Franchised Location, typically one to two miles. This size is determined by factors such as local daytime populations, the number of households, and other relevant market conditions.
Staffing Notes
MOD Pizza requires that a designated MOD Operator, along with two Management Staff members, successfully complete the training program and be certified before the restaurant's opening. During business hours, Management Staff must be on duty to supervise operations and employees. Franchisees must maintain a sufficient number of adequately trained service, kitchen, and other personnel to ensure efficient customer service. All employees are required to meet MOD Pizza's appearance standards and wear prescribed attire or uniforms.