Italian cuisine remains as one of the most popular cuisines in the world, particularly in the United States of America. So if you’re thinking of getting into the food business, one franchise to consider is Fazoli’s. A classic in the fast casual restaurant scene, Fazoli’s is known for their Italian – American food especially when it comes to their pastas.
How much does it cost to open Fazoli’s? To open this chain near you, you’ll need a minimum liquid capital of $250,000 and a minimum net worth of $750,000. The investment range to open a Fazoli’s is $783,500 to $1,553,500 and the franchise fee is $30,000 to $50,000.
Interested to know more about Fazoli’s, what they offer, and whether or not they’re worth the investment? Then read on below for our guide in franchising this beloved Italian-American chain. Take this 7-minute franchise quiz to get matched with a custom opportunity based on your interests and even book a call with me.
Financial Requirements and Fees
These are the financial requirements that Fazoli’s needs from interested franchise applicants:
|Fees / Expenses
|$783,500 to $1,553,500
|$30,000 to $50,000
Do note that the investment also varies if you choose to franchise a freestanding restaurant or an in-line/end-cap one. A freestanding restaurant is one that is solely the franchise’s location or it’s the only business in the area. For Fazoli’s, the area they require for a freestanding restaurant is around 2500 and 2800 square feet and the investment range is $1,082,000 to $1,752,818.
An in-line/end-cap restaurant is one that’s located in a building with other business and may be located at a corner or end of a building. For Fazoli’s, their end-caps require around 2500 square feet with drive-thru and the investment range is $800,200 to $1,298,818.
Fazoli’s also charges a royalty fee of 5% and an ad royalty fee of 4%. The term of agreement to run this franchise is 15 years and the franchise term is renewable.
Average Sales / Revenue per Year
According to Restaurant Business Online, Fazoli’s revenue in the US for the year 2022 reached $290 million in annual sales.
Fazoli’s Franchise Facts
|Pasta, Salad, Pizza
Who founded Fazoli’s?
Fazoli’s started out as Gratzi’s in 1988 before they changed their name to Fazoli’s in 1989. They were owned by Jerrico Inc., the same company that owned the Long John Silver’s seafood restaurant chain. Jerrico Inc. wanted to concentrate in developing Long John Silver so Fazoli’s was put up for sale and was bought by Seed Restaurant Group Inc. headed by Kuni & Carol Toyoda. At that time, there were only 5 Fazoli’s in Lexington, Kentucky and Seed Restaurant Group bought them all.
What company owns Fazoli’s?
At present, Fazoli’s is owned by FAT Brands Inc. They bought the Italian restaurant chain in 2021 for $130 million.
Fat Brands Inc. owns a number of food businesses such as Twin Peaks, Johnny Rockets, Marble Slab Creamery, and Great American Cookies.
The sampler at Fazoli’s.
How many Fazoli’s locations are there?
There are 210 Fazoli’s restaurants at the time of writing. You can find locations in the following states:
- North Carolina
- South Carolina
- South Dakota
- West Virginia
Is Fazoli’s Closing Locations? Is the chain closing down in Florida?
Back in 2009, Fazoli’s closed down 7 out of 14 of their restaurants in Florida. The reason cited for this was because the company wanted to focus their locations in the Midwest. At present, Florida has 6 Fazoli’s. Their locations are in:
- Mary Esther
- Panama City
- Plant City
What steps is Fazoli’s Taking to Return to Growth?
Fazoli’s is one business that started out very successful. Though they took a dip in 2008 as with all other businesses due to the financial crisis, the company bounced back and even found a way to survive the pandemic in 2020.
Pizza Baked Pastas.
Here are the things that they did to return to growth:
- Reopened in some states – In March 2022, Fazoli’s announced that they will reopen in Phoenix, Arizona along with opening 8 more restaurants in the area. Other cities such as Anderson, SC, Little Rock, AR, Orlando, FL and Newnan, GA will also have a Fazoli’s.
- New Promos – Fazoli’s introduced menu promotions such as the 5 Under $5 menu, Super Family Meal, and wings from their virtual kitchen concept Wingville. These promos increased their sales by 22% as well as traffic by 18% in 2020.
- Virtual Kitchen – Fazoli’s has started a virtual brand named Wingville which caters to flavored chicken wings and Macaroniville which is all about selling mac and cheese bowls paired with salads and pizza. Restaurants that were selling these wings saw an increase in sales by 11%. This prompted Fazoli’s to include Wingville to all their stores.
How Much Does Fazoli’s Make in Profit?
According to a report, a Fazoli’s franchise sees $305,287 in profit annually.
Is Fazoli’s a profitable business?
The same report showed that Fazoli’s has a 15 – 28% profit margin. That alone makes them a profitable franchise. However, the payback period can be very long. It is estimated that the average payback period can be around 11.5 years.
Before you invest in this franchise, make sure to take time to visualize whether or not you will be satisfied with this timeline.
A lot can change over the course of a decade. There’s no right or wrong decision. It comes down to your personal preferences, goals, and where you visualize yourself in the future.
Advantages of a Fazoli’s Franchise
Franchising Fazoli’s can bring you multiple advantages. Here are a few you can expect:
At Fazoli’s, the menu is not centered on pizza like what most Italian-American food chain restaurants offer. Fazoli’s decided to be different and focused their menu on pastas instead. This proved to be a successful decision since people enjoy their pastas at Fazoli’s.
The pasta menu includes baked spaghetti with meatballs, lasagna, baked ziti, and Fettuccine Alfredo. Other items on the menu include Italian subs, and salads. They even offer promos for customers to get more value for their meals. This is one of their mainstays that people also enjoy and which makes Fazoli’s quite popular through the years.
The Club sandwich at Fazoli’s.
Fazoli’s has been around since the early 90s which makes them a classic. And yes, they’ve closed some locations before but it looks like they’re having a major comeback by re-opening some of these locations and even opening Fazoli’s to locations they haven’t been open before.
Not Afraid of Competition
One of the general trade area guidelines for franchising Fazoli’s states that it can be “near other QSR, Fast Casual and Casual dining restaurants, including Italian restaurant competitors”. This just goes to show that Fazoli’s isn’t worried about competition since it’s okay for them to be located near other Italian restaurants. The confidence in their business makes franchisees feel more confident that the company can thrive even with competition.
Brand recognition: Fazoli’s is a well-established brand with over 30 years of history. This gives the company a significant advantage over newer restaurant chains that are still trying to build brand awareness.
Challenges of a Fazoli’s Franchise
There will always be challenges when handling a franchise. Here are some of them to consider and prepare for when you franchise Fazoli’s:
Basic Pizza Menu
As stated above, Fazoli’s concentrated on making delicious pastas rather than on focusing on pizzas. Though that decision has turned out to be a success, it would be nice if Fazoli’s also focused in developing their pizzas as well so they can offer both on their menu. At present, Fazoli’s only has cheese and pepperoni on their menu.
Despite Fazoli’s not being afraid of competition, the Italian-American cuisine in the United States is tough. There are many quick service restaurants that offer pizzas and pastas. Fazoli’s would need to constantly offer new products to get their customers to come back for more.
Changing consumer preferences. Consumer preferences are constantly changing, and Fazoli’s needs to keep up with the latest trends. For example, more consumers are looking for healthier and more sustainable food options. Fazoli’s has been trying to adapt to these changing preferences by adding new menu items and offering healthier cooking methods. It remains to be seen whether or not these efforts will pay off.
Is the Fazoli’s Franchise Right For You?
If Fazoli’s investment range fits your budget and you don’t mind waiting for more than 10 years to see a return in your investment then Fazoli’s could be for you. At the time of this writing, Fazoli’s is also expanding and growing their business so if you submit a franchise application and meet the financial criteria, you might just get approved.
What is an alternative Fazoli’s franchise?
If you’re still interested in an Italian-American cuisine food chain then check out MOD Pizza. They’re known for their make-your-own pizzas and baked fast. They have 40+ topping options to choose from and they’ve been around since 2013.
To franchise MOD Pizza, expect the initial investment to be around $714,000 to $1,092,000 with a franchise fee of $30,000. To know more about MOD Pizza, check out our guide in franchising them here.
If you were having doubts before in franchising Fazoli’s, I hope this guide was able to give you some clarity and perspective on whether or not this restaurant franchise is right for you.