Valpak Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$80,200 - $200,800
Franchise Fee
$1,600
Min Cash Required
$50,000
Total US Locations
138
Business Summary
Valpak's core business involves printing, publishing, and distributing cooperative direct mail advertising, primarily through its distinctive blue envelopes. Valpak also offers and sells electronic coupon advertising through its website, email, and mobile applications. Franchisees promote and sell these advertising services within designated geographic areas.
Corporate History
Valpak Direct Marketing Systems, LLC was formed as a Delaware limited liability company in 2021, but its operations date back to August 1986 when it was incorporated as Valpak Direct Marketing Systems, Inc. The company began offering franchises for its direct mail advertising business in 1986, building on a history of offering distributorships since 1968. Valpak's primary business involves printing, publishing, and distributing cooperative direct mail advertising using its distinctive VALPAK Envelopes from a large production facility in St. Petersburg, Florida. The brand has evolved to include electronic coupon advertising through its website, email, and mobile applications. An affiliate, Valpak Franchise Operations, LLC, has operated similar businesses since 2014. In November 2023, Clipper Media Acquisition I LLC purchased Valpak's ultimate parent company.
Financial Overview
Investment Range
$80,200 - $200,800
Franchise Fee (Low)
$1,600
Franchise Fee (High)
$2,500
Minimum Cash Required
$50,000
Equipment Costs (Low)
$4,300
Equipment Costs (High)
$10,500
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Valpak Direct Marketing Systems, LLC appears to be in strong financial health. The company's financial statements show consistent positive net income, reporting $45,029,302 in 2023, $32,983,259 in 2022, and $39,144,329 in 2021. Valpak maintains healthy current assets that exceed its current liabilities, indicating good working capital. The independent auditors have issued an unqualified opinion on the consolidated financial statements and explicitly stated that there are no conditions or events raising substantial doubt about Valpak's ability to continue as a going concern.
Financing Details
Valpak does not offer direct or indirect financing to its franchisees. Additionally, Valpak does not guarantee any notes, leases, or other obligations for its franchisees.
Performance Metrics
Total US Locations
138
Franchised Units
48
Corporate Units
90
Franchising Since
1986
Legal & Compliance Analysis
Recent Litigation
Yes
Bankruptcy
No
Litigation Count
6
Litigation Summary
Valpak has been involved in six litigation cases. Several recent cases include Stephen Sewalk (2022-2023), NFocus Consulting (2020-2021), Jennick Direct, Inc. et al. (2021-2022), and Premium Remodeling, Inc. (2018-2022), which were either filed or settled within the last three years. The Stephen Sewalk case involved a franchisee's termination due to an owner's personal bankruptcy, which was settled for $12,000. NFocus Consulting sued Valpak for alleged trade secret misappropriation, resulting in a $470,000 settlement. Jennick Direct and other franchisees sued Valpak over a new product and fee structure; this was settled in December 2021. Premium Remodeling, a customer, sued Valpak for breach of contract regarding advertising services, which settled for $10,000 in May 2022. Earlier cases from 2014-2017 involved Canadian franchisees alleging disclosure document deficiencies and a New York franchisee disputing arbitration decisions, both of which were settled. Valpak denies wrongdoing or liability in these settlements.
Bankruptcy History
Valpak has no bankruptcy history to report. Item 4 of the Franchise Disclosure Document explicitly states that no bankruptcy is required to be disclosed.
Agreement Terms
Initial Term
10 years
Renewal Term
5 years
Renewal Conditions
To renew their franchise, Valpak franchisees must substantially comply with all material provisions of their agreement and be in full compliance with its terms at the time of renewal. They must also meet the specified performance requirements and provide written notice of their desire to renew between 90 and 180 days before the agreement expires. Finally, franchisees must execute Valpak's then-current form of Renewal Agreement, which may contain terms and conditions that are materially different from their initial agreement.
Training & Support Program
Franchisor Assistance
Valpak provides comprehensive support to its franchisees, starting with mandatory New Franchise Owner Training (NFOT) for new owners and optional New Representative Training for sales staff, available virtually or at headquarters. Valpak may cover some travel and lodging costs for NFOT. Ongoing support includes advanced training sessions and webinars on various topics, an annual business meeting for networking, and access to an electronic New Franchise Owner kit. During the first year, franchisees may receive coaching and assistance from an assigned Franchise Development Manager, and Franchise Business Consultants are available for financial planning and operational advice. Valpak provides extensive sales and marketing support through its InsideValpak.com platform, offering digital sales tools, category resources, and industry trend intelligence, along with assistance for client advertising samples and data. The company handles graphics preparation, printing, collation, and distribution of VALPAK Envelopes and PlusOne products. Additionally, Valpak offers national advertising, public relations, and local advertising design assistance, and provides access to its operating procedures via insidevalpak.com.
Initial Training Hours
40
Training Location
Corporate headquarters in St. Petersburg, Florida or online/virtual
Ongoing Support
After opening, Valpak franchisees receive ongoing support through various channels. This includes optional advanced training sessions and webinars via Valpak University on topics like new product rollouts and sales strategies. Valpak generally hosts an annual business meeting for further training and networking opportunities. Franchisees have 24/7 access to InsideValpak.com, which provides sales tools, category resources, and industry trend intelligence. Valpak's marketing department offers client advertising samples, research, and other data. For the first year of operation, franchisees may receive coaching and assistance from an assigned Franchise Development Manager. Franchise Business Consultants are also available to provide financial planning and operational advice as needed. Valpak handles the production and distribution of VALPAK Envelopes and PlusOne products, including graphics, printing, and mailing services. The company also provides marketing support such as market research, national advertising, public relations, and local advertising design assistance. Operating procedures are continuously accessible and updated through InsideValpak.com.
Franchise Requirements
Industry Experience Required
No
Management Experience Required
No
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Hybrid
Owner Participation
Supervisory
Territory Type
Non-Exclusive
Territory Size Requirements
Valpak territories are generally defined by counties, though other boundaries may be used, and their size varies for each franchise. Valpak typically requires a territory to include a minimum of 50,000 "Prime Households" in one or more counties. However, depending on demographic and other factors, Valpak may grant a franchise for a territory with fewer Prime Households. A "Neighborhood Trade Area" (NTA) is a smaller geographic unit within a territory, containing approximately 10,000 residential addresses. "Prime Households" are chosen based on a range of total household income, typically excluding the top 5% and bottom 15% of incomes over $20,000, which can be adjusted upon request.
Staffing Notes
Valpak requires the franchise business to operate under the direct supervision of the franchisee or a Valpak-approved Key Person who has completed franchisee training. The franchisee is solely responsible for all aspects of employee management, including hiring, firing, setting employment terms, providing proper training, and ensuring compliance with all applicable labor laws such as wage, withholding tax, overtime, and workers' compensation. A Key Person, if designated, must also execute a confidentiality and non-competition agreement with Valpak.