Business View - February 2015 79
to have the opportunity to tell the Sbarro turnaround
story. We’re honest and candid with people to let them
know that we’re in the very early innings of the turn-
around. But we’ve got tangible evidence. We’ve got
stores and menu and packaging changes that we can
point to as a part of that transition. We’ve got a much
stronger balance sheet that we can share with them
that shows a company that is financially is very strong.”
Franchisee candidates are required to have a mini-
mum net worth of $1 million – excluding their primary
residence – and $350,000 in available liquid assets.
The franchise fee is
$25,000 for a 10-year
agreement, with a 5 per-
cent royalty and a 2 per-
cent marketing fee. Typi-
cal start-up costs include
between $80,000 to
$150,000 for equipment
and fixtures, $5,000 to
$7,000 for opening inven-
tory, $8,000 to $10,000
for training expenses and
$1,000 to $5,000 for the
grand-opening package.
Construction costs and
leasehold improvements
vary by site.
“We’re not necessar-
ily looking for that large,
experienced operator,”
Karam said. “We’re look-
ing for a hands-on opera-
tor and somebody who
has a certain entrepre-
neurial flair and under-
stands that this is an opportunity for them to get in-
volved with a lower entry point, and an opportunity to
be a little bit more creative from a franchising stand-
point in terms of marketing and finding opportunities
to deliver the product. There’s a good opportunity to
make solid profitability and return on that investment.”
Going forward, making sure the company is franchise-
friendly is a priority.
Keeping the concept relevant in the marketplace and
appealing to customers is job one toward that aim,
FRANCHISE
