Papa Murphy’s Holdings, Inc. announced a new Growth Market Development Incentive focused on attracting and partnering with experienced, development-oriented operators that align with the growing brand’s values and culture. Qualified franchisees signing area development agreements in select, larger markets through 2017 may be eligible for more than $75,000 per store in financial incentives including:
Zero percent royalties for the first three years of operation on all stores in the market. For the average store, this equates to around $22,000 per year in savings.
$35,000 paid by Papa Murphy’s to the franchisee/area developer to help fund opening costs. This will be paid upon the opening of every new store during the first three years of operation.
$1,500 monthly rebate paid by Papa Murphy’s to the franchisee/area developer for each store that opens during the first three years.
“As we continue our expansion, we are pleased to offer compelling financial incentives to franchisees that are interested in pioneering our brand in newer markets,” says Jayson Tipp, chief development officer for Papa Murphy’s. “The program is designed to accelerate frontier market growth across the country. We know that growing store penetration quickly in markets is the best way to increase awareness—and higher awareness improves performance.”
This news comes as Papa Murphy’s continues to focus on accelerating unit growth in select underpenetrated markets. The company recently announced it is expanding the scope of its relationship with franchise recruiting advisory firm Franchise Performance Group. The company has identified 36 Designated Market Areas (DMAs) as potential markets that may be eligible to receive this incentive.
Papa Murphy’s will also continue to offer the Growth Market Development Incentive that began in September 2016, which provides a franchise fee reduction of $5,000 per store. Additionally, each store qualifying for this incentive will receive a royalty fee waiver for the first 12 months of operation. Franchisees are required to sign a new multi-store agreement (MSS) or ADA of at least two stores. This incentive is available in 83 DMAs where fewer than 10 stores are required to reach the targeted penetration goal of one store per population of 80,000. These DMAs include 49 markets where Papa Murphy’s franchisees currently operate stores as well as 34 DMAs adjacent to existing markets.
The incentives are subject to the complete rules and eligibility requirements of the program at the time of signing. Full program details are available upon completion and review of the application.