In this FDD Talk post, you’ll learn the following:
- Section I – Background information on the Pita Pit franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a Pita Pit franchise, based on Item 7 of the company’s 2020 FDD
- Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Pita Pit franchise, based on Items 5 and 6 of the company’s 2020 FDD
- Section IV – Number of franchised and company-owned Pita Pit outlets at the start of the year and the end of the year for 2017, 2018, and 2019, based on Item 20 of the company’s 2020 FDD
- Section V – Presentation and analysis of Pita Pit’s financial performance representations, based on Item 19 of the company’s 2020 FDD, including information on the:
- 2019 high and low gross sales for the 153 franchisee-owned Pita Pit Restaurants in the United States that operated for the entire 2019 calendar year, including 3 located in convenience stores
Section I – Background Information
20 Things You Need to Know About the Pita Pit Franchise
Pita Pit Canada Enters Cannabis Market
1. In mid-January 2019, Pita Pit Canada announced that it has partnered with WeedMD, Inc., a federally licensed producer and distributor of medical-grade cannabis in Canada, to launch Pioneer Cannabis Corp., a company that will help Canadians operate their own cannabis retail stores, according to a company press release.
2. Kristie Smith, president of Pioneer Cannabis Corp., who has served as Pita Pit’s director of development for the past eight years, said, “Pioneer brings an opportunity to those entrepreneurs interested in joining the cannabis industry, but who may not have the financial backing or the operational experience to pursue opening their own retail cannabis store. Through this collaboration of established Canadian companies, we are paving the way for small businesses to participate in the emerging retail cannabis space that will promote local economic growth and opportunities.”
3. The company will provide retailers with a variety of services including, but not limited to, identifying locations, providing assistance with licensing and security processes, point of sales and payment systems, marketing services, and training platforms that will include cannabis educational programs – each in accordance with the unique regulatory environment in each province and municipality, according to the release.
4. “The partnership between Pita Pit, which has helped many small business owners realize their dreams through proprietorship, and WeedMD, a trusted premium cannabis producer and distributor, will help entrepreneurs start up and operate their own stores safely and effectively,” said Keith Merker, CEO of WeedMD. “We are excited to be a part of this opportunity and, together with Pita Pit, we look forward to Pioneer setting the standard for the Canadian cannabis retail experience.”
5. Chris Fountain, CEO of Pita Pit, said he’s grateful to be a part of the emerging cannabis industry. He said, “We care about our communities where we live and do business. We are excited for the opportunity to step up and be responsible stewards within a system that will benefit from participants who are of the highest integrity and are committed to the well-being of the people within these communities.”
6. At the end of February 2020, Pita Pit opened one of its newest locations in Richmond, Virginia. Franchisee Jordan Anderson opened his Pita Pit near Virginia Commonwealth University (VCU). Anderson knew he wanted to open a business ever since watching CBS’s Undercover Boss. “I remember thinking it’s something I could do one day,” he said in an interview on his opening day.
7. To celebrate, the downtown Richmond area and VCU campus enjoyed $5 pitas all day on February 28. “I’m also employing a lot of students,” said Anderson. “They are great ambassadors who support a healthy lifestyle. Go Rams!”
8. Consumer eating trends have shifted toward healthier options and Pita Pit has created an entire culture and proven franchise system to meet the growing demand. Pita Pit franchising is a great way to become part of the booming restaurant industry.
9. The fresh made-to-order pitas are completely customizable and Anderson couldn’t choose one favorite. Instead, he said he loves the gyro and chicken pesto. He added that Pita Pit includes Mediterranean options without pine nuts which is great for those with allergies.
10. “I have fond memories of eating at the Pita Pit in my hometown of Mason City, Iowa so this is a dream come true,” said Anderson. “The Pita Pit franchise model gives me all the tools I need to be successful.”
Pita Pit Canada Raises More Than $72,000 for Make-A-Wish in 2019
11. Each year in April, Pita Pit Canada franchisees raise funds for Make-A-Wish Canada. 2019 was a success with stores raising $72,230 nationally, and making wishes come true across the country. Pita Pit Canada and Make-A-Wish were happy to share some of the wishes granted by this initiative in 2019.
12. On April 29, 2019, Pita Pit Canada celebrated World Wish Day, an annual day of recognition and celebration of the wish granted to Chris Greicius in 1980 that inspired the creation of Make-A-Wish and its mission.
13. Franchisees donated $1 from every pita sold to Make-A-Wish, helping the organization grant life-changing wishes for children with critical illnesses. Throughout April, franchisees collected donations of $2 from customers who came through the store to share in the fundraising, through the “Stars for Wishes” campaign.
14. With $72,230 total raised in 2019, Pita Pit has now doubled its overall contribution to Make-A-Wish throughout the partnership and granted a total of 14 wishes to children in communities across Canada.
15. Kevin Pressburger, president of Pita Pit Canada, said, “Our partnership with Make-A-Wish has truly been one of the most rewarding experiences for our franchisees and the organization. For many of us, our commitment to Make-A-Wish has become very personal. We become invested in not just making a difference for the wish recipients and their families but by embracing and sharing the significance of their stories to ensure we all understand the positive impact we should be making in our communities.”
16. According to Chris Pon, vice president, national corporate alliances of Make-A-Wish Canada, “The incredible support that we receive from Pita Pit allows us to grant wishes which can transform the lives of children and families. When a wish is granted, a child replaces fear with confidence, sadness with joy and anxiety with hope – a powerful combination that may lead to better health outcomes. We are so grateful to work with the amazing team at Pita Pit. We thank them and their generous customers for helping make dreams come to life at such a critical time.”
17. Pita Pit Canada and Make-A-Wish Canada have had a long-standing partnership, now entering its fourth year. This partnership is looking to grow with new opportunities and higher fundraising, including reaching a donation goal of $100,000 in 2020. Pita Pit Canada will continue to participate in Make-A-Wish Rope for Hope, where it provides a catered lunch and volunteers at 10 events across the country.
18. Pita Pit was founded in 1995 by Nelson Lang and John Sotiriadis near Queen’s University in Kingston, Ontario, Canada. Lang and Sotiriadis wanted to offer students a healthy and affordable alternative to traditional fast food. Pita Pit was a hit and two years later, franchising started in Canada.
19. In 1999, Pita Pit opened its first international franchises in the U.S. Pita Pit continued to grow around North America over the next few years and by 2006, there were 100 locations. Since then, Pita Pit has opened locations in other countries, including India, France, Brazil, Panama, Trinidad and Tobago, the United Kingdom, New Zealand, Australia, Singapore, United Arab Emirates, and Ireland.
Entrepreneur’s Franchise 500
20. Pita Pit did not rank on Entrepreneur’s 2020 Franchise 500 list.
Section II – Estimated Costs
- Please click here for detailed estimates of Pita Pit franchise costs, based on Item 7 of the company’s 2020 FDD.
Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees
- Please click here for detailed information on Pita Pit’s initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2020 FDD.
Section IV – Number of Franchised and Company-Owned Outlets
- Outlets at the Start of the Year: 236
- Outlets at the End of the Year: 219
- Net Change: -17
- Outlets at the Start of the Year: 219
- Outlets at the End of the Year: 186
- Net Change: -33
- Outlets at the Start of the Year: 186
- Outlets at the End of the Year: 165
- Net Change: -21
- Outlets at the Start of the Year: 16
- Outlets at the End of the Year: 15
- Net Change: -1
- Outlets at the Start of the Year: 15
- Outlets at the End of the Year: 11
- Net Change: -4
- Outlets at the Start of the Year: 11
- Outlets at the End of the Year: 5
- Net Change: -6
Section V – Financial Performance Representations (Item 19, 2020 FDD) and Analysis
- This is a historic financial performance representation about a subset of outlets. This subset is made up of those franchisee-owned outlets that operated for the entire 2019 calendar year.
- The range of Gross Sales for franchisee-owned Restaurants provided in this Item 19 is comprised using the 2019 financial information derived from Pita Pit’s franchisees’ point-of-sale system, or in some instances, sales reports provided to Pita Pit by its franchisees that do not utilize a point-of-sale system.
- On December 31, 2019, there were 165 franchisee-owned Restaurants in the United States. These 165 Restaurants do not include any Restaurants that were corporately-owned for any period during 2019. Of these 165 franchisee-owned Restaurants, 153 operated for the entire 2019 calendar year.
- Of these 153 Restaurants, 3 were located in convenience stores.