Papa Murphy'sFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Papa Murphy's franchise requires a total initial investment of $367K – $670K, including a $25K franchise fee and an ongoing 5.0% royalty[2]. Per the 2024 FDD, average unit revenue was $681K[2]. SBA 7(a) loans show a 9.3% charge-off rate across 119 loans[1]. Verdict grade: A. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2024 FDD issuance
Overview
- Investment
- $367K – $670K
- 69th pct Service Resta…
- Avg gross sales
- $681K
- 20th pct Service Resta…
- Royalty
- 5.0%
- 13th pct Service Resta…
- Units
- 1,127
- 94th pct Service Resta…
- SBA default
- 9.3%
- system-wide median varies by category
Quick verdict · Quick-Service Restaurants · color = vs category peers
Green = >15% above Quick-Service Restaurants avg · No shading = within ±15% · Red = >15% below avg · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Franchising since 1995. Systems this mature have refined operations and brand recognition.
Large franchise systems benefit from brand recognition, supply chain leverage, and proven operations.
Bottom line
- Total investment $367K – $670K including a $25K franchise fee, 5.0% ongoing royalty.
- Average unit revenue of $681K/year (median $613K).
- Verdict A (Top Quintile) with a risk score of 35/100. SBA loan charge-off rate of 9.3% across 119 loans (near or below the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2024).
- System contracting at -7.7% CAGR over 3 years. Investigate whether closures are franchisor-driven (consolidation) or franchisee-driven (economics).
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Papa Murphy's International LLC
- Parent company
- MTY Food Group Inc.
- CEO title
- Chief Executive Officer
- Eric Lefebvre
- Incorporated in
- DE
- HQ
- 8000 NE Parkway Drive, Suite 100, Vancouver, Washington 98662
- Auditor
- PricewaterhouseCoopers LLP
- Audited financials
- Franchisor revenue
- $263.7M
- vs $580.3M prior year
- Management churn noted
- Frequent turnover
- Item 2 disclosed frequent executive changes
Overview
About
Papa Murphy's franchisees operate take-and-bake pizza locations where customers select ingredients and watch pizza preparation before taking it home to bake. Daily operations include dough preparation, ingredient management, customer order fulfillment, packaging, and maintaining food safety standards in a limited-service format with no on-site dining.
- CEO
- Eric Lefebvre
- Headquarters
- WA
- Founded
- 1981
- FDD year
- 2024
- States available
- 36
FDD Item 7 · 2024 filing · 18 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial or Subsequent Franchise Feenot refundable | $15K | $25K | |
| Lease and Utilities Deposits and Payments | $3K | $8K | |
| Leasehold Improvements | $139K | $278K | |
| Signs | $9K | $25K | |
| Stamped Architectural Drawings | $6K | $9K | |
| As Built Survey | $3K | $4K | |
| Opening Package (Equipment, Supplies, Decor, Cabinets, POS, Smallwares) | $150K | $220K | |
| Miscellaneous Development Service Fees | $0 | $1K | |
| Inventory | $5K | $7K | |
| Initial Marketing Fees and Expenses (6 months) | $15K | $15K | |
| Franchise Premises Rent (3 months) | $9K | $12K | |
| Materials and Supplies | $500 | $2K | |
| Operations In-Store Training, Enterprise Solution Training and Foundations Class | $0 | $750 | |
| Travel and Living Expenses for Training | $1K | $9K | |
| Employee Training | $500 | $2K | |
| Insurance (3 months) | $375 | $1K | |
| Bookkeeping/Payroll Service (3 months) | $825 | $2K | |
| Additional Funds, Working Capital, and Miscellaneous Expenses (3 months) | $10K | $50K | |
| Total initial investment | $367K | $670K |
Line items extracted from FDD Item 7. Ranges reflect the franchisor's stated low and high per line. Total is the sum of line-item lows / highs — actual costs may fall outside this range depending on market and build-out scope.
Single-unit · estimated
Returns at a glance
Indicative numbers using FDD Item 7 / Item 19 inputs and category-benchmarked cost ratios. Full single-unit, 25-unit portfolio, and LBO models (with every input editable to stress-test your own scenario) live on the financials page.
Store EBITDA · annual
$102K
15.0% margin
Unlevered ROIC
19%
EBITDA / total invested capital
Payback
5.4 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $367K – $670K
- Below avg, review vs category
- Liquid capital req'd
- $10K – $50K
- Better than avg vs category
- Franchise fee
- $15K – $25K
- Better than avg vs category
- Royalty
- 5.0%
- Net Sales · typical 6–8%
- Ad fund
- 2.0%
- typical 3–5%
- Total fee load
- 7.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 5.0% of gross sales |
| Marketing / ad fund | 2.0% of gross sales |
| Transfer fee | $13K |
| Total fee load | 7.0% of rev |
Financial Performance
- Avg gross sales
- $681K
- Per unit, per year
- Median gross sales
- $613K
- Item 19 type
- net_sales
- Sample size
- 1085 units
- vs category median 28 · large
- Range (low → high)
- $186K→$2.5M
- Cohort dispersion (min → max)
- Quartile band
- $314K→$1.4M
- Bottom 25% → top 25%
- Reporting year
- 2023
- Fiscal year the figures cover
- Transparency
- 4 / 5
- vs category median 4 / 5 · typical
Compared against 453 Quick-Service Restaurants brands
vs Quick-Service Restaurants averages
How Papa Murphy's Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 1,127
- Opened
- 19
- Last reporting year
- Closed
- 45
- Turnover rate
- 4.0%
- Company-owned
- 8
- Corporate units in the system
- % franchised
- 99%
- vs corporate-owned
- Net growth (yr3)
- -2.3%
- Net unit change last year
- 3-yr CAGR
- -7.7%
- Compounded over last 3 years
3-year detail · Item 20
- Closed (3yr)
- 44
- Terminated (3yr)
- 28
- Transfers (3yr)
- 54
- Transfer rate
- 4.8%
- Owners selling to other franchisees
- Termination rate
- 2.5%
- Franchisor-initiated terminations
- Ceased ops
- 3.9%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 18 states with active franchisees
The Territory Map
Derived from franchisee contact records. Shows states with at least one current operator. Not where the franchisor is registered to sell new units (that data is re-extracting in a future refresh).
States derived from franchisee contact records (FDD Item 20). Shows states with at least one current operator on file. Full state registration data (Item 12) will appear on a future FDD refresh.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 119
- Loan volume
- $32.2M
- Median loan
- $243K
- 50th percentile
- Charge-off rate
- 9.3%
- rates vary by category · see methodology
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- 90.7%
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 52
- Defaults
- 10
Vintage analysis
Papa Murphy's charge-off rate by loan vintage
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Papa Murphy's's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 10 lenders with concentration factor
- Per-state charge-off rates across 15 states
- Startup risk premium and job creation velocity
- 6-year lending trend
Instant access. No subscription.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Papa Murphy's presents elevated risk due to shrinking franchise system, undisclosed profitability metrics, history of litigation regarding franchisee obligations, and unprotected territory exposure.
Litigation (Item 3)
DTD Pizza, LLC et al. v. Papa Murphy's International LLC and Mitch and Kristen Brink et al. v. Papa Murphy's International LLC (Washington Superior Court, Clark County). Two related actions commenced April-June 2014 by franchisees alleging misrepresentations in Item 19 financial performance representations, violation of Washington Franchise Investment Protection Act (WFIPA), fraud, negligent misrepresentation and breach of contract. Consolidated September 2014 under Case 14-2-00904-0. Settled and dismissed with prejudice in June 2020. Settlement included: one group dismissed for no consideration; two groups paid $5,000-$8,000; one group received advertising cost coverage for one year, additional franchise development right, and $10,000 development fee return; one group remained in exchange for 3.8% of sales toward local advertising for two years and ten-year term extension; fifteen groups received $10,000-$4,000,000 settlements; Papa Murphy's purchased nine stores from one group at asset value plus $500,000; and purchased stores from seven groups at asset value.
Largest disclosed settlement: $4,000,000
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · PricewaterhouseCoopers LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: Yes
- Kickbacks from required suppliers: No
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 35 / 100 rating
- 01MINORUnit count declining 2.3% YoY (1127 units) indicates system contraction and potential market saturation or operational challenges
- 02HIGHMultiple settled litigation cases involving misrepresentations and marketing obligations suggest compliance issues and franchisee disputes
- 03MINORNo average net income disclosure (Item 19) prevents assessment of actual profitability relative to $367-670K investment
- 04MINORUnprotected territory creates direct competition risk from other franchisees and corporate-owned locations in same area
- 05MINOR5% royalty on top of operating costs with declining unit economics may pressure franchisee margins
- 06MINORHigh investment range ($303K spread) with declining units raises questions about ROI and break-even timeline
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 5 years |
| Protected territory | No |
| Exclusive territoryℹ | No |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 25 mi |
| Right of first refusalℹ | Yes |
| RoFR response window | 21 days |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | No |
| Jury trial waiver | Yes |
| Governing law | Washington |
| Litigation count | 3 |
View Item 3 litigation summary
DTD Pizza, LLC et al. v. Papa Murphy's International LLC and Mitch and Kristen Brink et al. v. Papa Murphy's International LLC (Washington Superior Court, Clark County). Two related actions commenced April-June 2014 by franchisees alleging misrepresentations in Item 19 financial performance representations, violation of Washington Franchise Investment Protection Act (WFIPA), fraud, negligent misrepresentation and breach of contract. Consolidated September 2014 under Case 14-2-00904-0. Settled and dismissed with prejudice in June 2020. Settlement included: one group dismissed for no consideration; two groups paid $5,000-$8,000; one group received advertising cost coverage for one year, additional franchise development right, and $10,000 development fee return; one group remained in exchange for 3.8% of sales toward local advertising for two years and ten-year term extension; fifteen groups received $10,000-$4,000,000 settlements; Papa Murphy's purchased nine stores from one group at asset value plus $500,000; and purchased stores from seven groups at asset value.
Items 10, 11
Training & Operations
- Classroom training
- 15 hrs
- On-the-job training
- 325 hrs
- Training location
- Designated Papa Murphy's training store
- Ongoing training
- Required
- Field support
- 325 hrs/yr
- On-site visits per year
- Time to open
- 12 mo
- From signing to launch
- POS system
- NCR point-of-sale system
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: NCR point-of-sale system
Item 20 · call current owners
Franchisee Contacts
97 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Papa Murphy's · FDD (2024) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Papa Murphy's franchise?
The total investment to open a Papa Murphy's franchise ranges from $367K – $670K, with an initial franchise fee of $25K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Papa Murphy's franchise owners earn?
According to Item 19 of the Papa Murphy's FDD, the average gross sales per unit is $681K. The median is $613K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Papa Murphy's's franchise failure rate?
Based on SBA 7(a) loan data, Papa Murphy's has a charge-off rate of 9.3% across 119 loans, meaning 9.3% of franchise loans were charged off. Charge-off rates are one proxy for franchise risk, though they do not capture all closures. This data comes from FOIA-sourced SBA lending records.
How many Papa Murphy's franchise locations are there?
As of their most recent FDD filing, Papa Murphy's has 1,127 total units in the United States, including 1,119 franchised units and 8 company-owned units. 19 new units were opened in the latest reporting year.
Is Papa Murphy's a good franchise to buy?
FranchiseVerdict rates Papa Murphy's as a A-grade franchise with a risk score of 35 out of 100, based on our analysis of investment costs, revenue data, SBA loan performance, and growth trends. Our rating is based solely on publicly available FDD and government data; we recommend speaking with current franchisees before making any investment decision. This is not investment advice.
Data sourced from public FDD filings and SBA 7(a) FOIA records. Not financial advice.
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Data extracted from public FDD filings and SBA 7(a) loan disclosures (FOIA). This information is provided for research purposes only and does not constitute financial, legal, or investment advice. Verify all figures with the franchisor's current Franchise Disclosure Document before making any investment decision.