How to Finance a Fox’s Pizza Den Franchise: The $500 Royalty
By Anthony Cornella
A Fox’s Pizza Den franchise loan is smaller than most restaurant franchise loans, and the brand’s fee structure is unusual. Instead of a royalty that rises with sales, Fox’s charges a flat monthly royalty and no marketing fee, which makes cash flow easier to project and leaves more room for debt service as a store grows.
This article covers what the franchisor says it costs to open a Fox’s Pizza Den, how the flat royalty affects a Fox’s Pizza Den franchise loan, how the Conversion Plus program works for existing pizza shops, and what the brand’s SBA Franchise Directory note means for borrowers.
US Professional Funding is not affiliated with, sponsored by or endorsed by Fox’s Pizza Den; the name is used only to describe the business. Figures from the franchisor’s disclosure document and website can change, loan programs and terms vary by lender and borrower, and every loan is subject to lender review and approval. Nothing here is legal, tax or investment advice, and buyers should review the current Franchise Disclosure Document (FDD) and franchise agreement with a qualified franchise attorney and accountant.
Fox’s Pizza Den Franchise Loan at a Glance
- Total investment: $108,800 to $236,000 to begin operation, according to the franchisor.
- Franchise fee: $20,000, plus $16,000 for site consulting, project management, training and grand opening setup.
- Discounts: veterans receive 50% off the franchise fee, and the Conversion Plus program for existing pizza shops currently discounts the franchise fee 50%.
- Royalty: a flat $500 per month, not a percentage of sales.
- Marketing fee: none, according to the franchisor.
- Liquid assets: $40,000 or more.
- Store size: ideally 1,200 to 1,500 square feet, freestanding or in a strip center.
- System size: over 195 locations in 18 states, according to the franchisor.
- SBA Franchise Directory: listed as “Fox’s Pizza Den,” with one note on lease documents when real estate secures the loan.
What Is Fox’s Pizza Den?
Fox’s Pizza Den was founded in 1971 by Jim Fox, who opened the first shop in Pitcairn, Pennsylvania, at age 24 with a rented storeroom and used equipment. The company says it added home delivery in 1973 and today has grown to over 195 locations in 18 states. The franchisor is based in Murrysville, Pennsylvania, near Pittsburgh.
The concept. Fox’s is a hometown pizza shop concept. The menu includes pizzas in several sizes, including the 21-cut “Big Daddy,” along with hoagies, its signature “Wedgie” sandwich, strombolis, wings, salads and garlic breadsticks. The franchisor encourages owners to get involved with local schools, sports and clubs.
The store format. According to the franchisor, an ideal location is 1,200 to 1,500 square feet and can be freestanding or in a strip mall. The format typically centers on carryout and delivery with a compact kitchen.
Supply chain. Fox’s operates two company-owned distribution centers, in Pittsburgh, Pennsylvania, and Vicksburg, Mississippi, which supply franchisees with food and products.
Why lenders view Fox’s the way they do. Lenders generally see a long-running system with a modest investment, a small footprint and a fixed royalty that keeps franchise costs predictable. The main underwriting questions are the store’s location and local competition, the owner’s ability to run a hands-on restaurant, labor and food costs, and whether the borrower has enough cash to carry the store through its opening months.
Fox’s Pizza Den Franchise Costs
Initial franchise fee. The franchisor lists a $20,000 franchise fee plus $16,000 for site consulting, project management, training and grand opening setup. Veterans receive a 50% discount off the franchise fee; our article on financing a franchise as a veteran explains how this kind of discount fits into a loan request. Owners converting an existing pizza shop through the Conversion Plus program currently receive a 50% franchise fee discount, which the franchisor says saves $10,000.
Real estate and build-out. A leased storefront is the usual setup for a shop this size. Build-out covers plumbing, electrical work, HVAC and ventilation for pizza ovens, counters and finishes. The franchisor assigns a project manager to help with architect drawings, permits and contractors.
Equipment. A pizza shop’s equipment package typically includes pizza ovens, a dough mixer, prep tables, walk-in or reach-in refrigeration, a hood and fire suppression system, smallwares and a point-of-sale system.
Opening costs and working capital. Opening inventory, grand opening marketing, deposits, insurance, licenses and payroll during the first months all belong in the budget. Because Fox’s does not collect a marketing fee, owners should set aside their own funds for local marketing.
Total investment. The franchisor states that the total investment necessary to begin operation of a Fox’s Pizza Den ranges from $108,800 to $236,000. The Item 7 table in the FDD breaks this range into its line items, which typically include:
- Initial franchise fee and pre-opening services
- Leasehold improvements
- Kitchen equipment, furniture and fixtures
- Signage and point-of-sale technology
- Opening inventory and supplies
- Lease deposits, insurance, permits and professional fees
- Additional funds for the initial operating period
Read the full Item 7 table and its notes in the current FDD for each line item’s range and assumptions. A conversion of an existing pizza shop may cost far less than a new build if the kitchen and equipment can be reused.
Ongoing Fees and How They Affect Your Loan
A flat royalty. Fox’s charges a flat royalty of $500 per month rather than a percentage of sales. For a lender, this is a meaningful difference: as sales grow, the royalty does not grow with them, so more of each additional dollar of revenue is available for operating costs, debt service and the owner’s income.
No marketing fee. The franchisor says it does not take a marketing fee and directs franchisees to recommended marketing partners. That lowers fixed franchise costs, but it also means each owner must budget for local advertising, online ordering promotions and community sponsorships.
Other fees. Item 6 of the FDD lists any additional fees, such as technology, training, transfer and renewal fees. Review each one before you build projections.
How lenders factor fees into cash flow. Lenders start with projected sales, subtract food and paper costs, labor, rent, utilities, the royalty and the owner’s marketing budget, and then measure what remains against loan payments. Because the royalty is fixed, the projections are easier to stress-test: lenders mainly focus on sales volume, food cost control and labor.
Franchisor Requirements for New Owners
Fox’s describes a straightforward qualification process:
- Liquid assets: $40,000 or more
- Application: complete an application and send a résumé
- Credit check: pass a credit check
- Funding: pre-qualify for funding
- Interview: interview with the franchise team
The ownership process. After applying, candidates review the FDD, visit the Pittsburgh-area headquarters, distribution center and a local store, sign the franchise agreement and pay the franchise fees. The franchisor then helps find a location, supports the build-out through a project manager and sends a team on site at opening to set up inventory and train employees.
Financing support. Fox’s says it does not offer financing but has relationships with outside lenders that help franchisees through the financing process, including SBA loans.
Ways to Own a Fox’s Pizza Den
A new store. A new Fox’s is financed on projections, the owner’s experience and the franchisor’s site and build-out support. See our page on franchise start-up financing.
Converting an existing pizza shop. Through the Conversion Plus program, independent pizza shop owners can convert to Fox’s with a 50% franchise fee discount, and the franchisor says no previous Fox’s experience is needed. Lenders often view conversions favorably because the owner has operating history, a trained staff and existing equipment, so the loan may cover only the conversion work, new signage and any equipment upgrades.
Buying an existing Fox’s. Existing stores sometimes come up for sale. A resale gives a lender actual sales history to underwrite, and the buyer needs franchisor approval of the transfer. Our article on buying a franchise resale covers the process, and our franchise restaurant acquisition financing page explains how purchase loans work.
Fox’s Pizza Den Franchise Loan Options
SBA 7(a) loans. Because Fox’s is listed on the SBA Franchise Directory, an SBA 7(a) loan is often a practical fit. A 7(a) loan can cover the franchise fee, build-out, equipment and working capital, or the purchase of an existing store.
SBA 504 loans. If you buy the building for your store, the SBA 504 program can finance owner-occupied real estate and long-lived equipment. The directory note below applies in that case.
Conventional term loans. Owners with strong credit and collateral, or existing operators adding stores, may use a conventional business loan.
Equipment financing. Ovens, mixers, refrigeration and prep equipment can often be financed or leased separately, which preserves cash for opening. Learn more about restaurant equipment financing and leasing.
Working capital and lines of credit. A new pizza shop pays for inventory, payroll and local marketing before sales stabilize, and sales can swing with school calendars, sports seasons and holidays. A line of credit helps smooth those swings. See our restaurant working capital options.
Seller financing on resales. When buying an existing store, a seller may carry part of the price. A seller note must be acceptable to the senior lender and is typically subordinate to it, and SBA program rules may limit how it is structured.
SBA Loans for Fox’s Pizza Den Franchisees
The SBA Franchise Directory lists franchise brands whose agreements have been reviewed for SBA eligibility. SBA lenders generally require a brand to appear on the directory before making an SBA-guaranteed loan to one of its franchisees. A listing clears the franchise relationship for review; it does not approve any borrower.
Fox’s directory listing. Fox’s Pizza Den is listed on the SBA Franchise Directory under code S0666, with one note: when the real estate where the franchise business is located will secure the SBA-guaranteed loan, the Conditional Assignment of Lease may not be executed.
What the note means. A conditional assignment of lease lets a franchisor take over a franchisee’s lease in certain situations, and it only makes sense for a leased location. If the owner or a related company owns the building and pledges it as collateral for the SBA loan, that lease document should not be signed for the location. For the typical Fox’s owner who leases a storefront, the note usually does not change the transaction.
Program size and tips. The SBA 7(a) program maximum is currently $5 million, though program rules can change; most Fox’s loans are far smaller. Prepare a business plan with local market research, a lease or letter of intent, contractor and equipment quotes, the FDD and your personal financial statement and tax returns. Our SBA loan calculator gives early payment estimates for planning only, not an offer or approval.
How Lenders Evaluate a Fox’s Pizza Den Deal
Personal credit and financial history. Lenders review credit, tax returns and a personal financial statement, and typically require a personal guarantee.
Net worth and liquidity. The franchisor’s liquid asset threshold is a starting point. Lenders also look at what remains after the equity injection to cover the ramp-up period. Our article on how much franchise you can afford walks through the math.
Restaurant and management experience. Food service, kitchen or retail management experience strengthens a Fox’s Pizza Den franchise loan request.
Business plan and projections. A credible plan shows the trade area, nearby competitors, expected carryout and delivery volume, food and labor costs, rent, the flat royalty and the owner’s local marketing budget.
The FDD and franchise agreement. Lenders review the franchise term, renewal and transfer provisions and any supply requirements tied to the distribution centers.
Site and lease. Lease length, renewal options, rent escalations and landlord improvement allowances all affect risk. Lenders generally prefer lease terms, including options, that extend through the loan term.
Historical financials. For a conversion or resale, expect to provide several years of profit and loss statements, sales reports and tax returns.
Equipping a Pizza Kitchen
Pizza shops are equipment-intensive for their size. The oven is the centerpiece, supported by a dough mixer, refrigerated prep tables, walk-in or reach-in coolers, a hood and fire suppression system, sinks, smallwares and delivery bags. A point-of-sale and online ordering system ties the operation together, and the franchisor offers a mobile ordering app for customers.
Financing equipment separately. Because ovens and refrigeration have long useful lives, they can often be financed or leased apart from the build-out loan, freeing cash for opening inventory and payroll.
Multi-Unit Growth
The franchisor notes that multiple locations are available, and some owners add a second store once the first is stable. Once the first store has operating history, lenders can underwrite its cash flow alongside projections for the next one. Because the royalty is flat rather than tied to sales, a group of stable stores can leave more cash to support financing for additional locations.
Financing a second store. Many owners use a separate Fox’s Pizza Den franchise loan for each store, and a hands-on pizza business needs a trusted manager in each location.
Real-World Scenarios
A first-time owner in a small town. A former restaurant manager with the required liquid assets opens a Fox’s in a strip center near a high school. She uses an SBA 7(a) loan for the build-out, equipment and working capital, and keeps a reserve for local marketing since there is no system marketing fee.
An independent pizzeria converts. The owner of a long-running independent pizza shop joins through Conversion Plus. Because the kitchen is already built, a small loan covers new signage, menu boards, point-of-sale technology and a replacement oven.
A veteran buys an existing store. A veteran buys an established Fox’s from a retiring owner. The lender underwrites the store’s sales history, the purchase is financed with an SBA 7(a) loan and a small seller note, and the franchisor approves the transfer.
Common Mistakes to Avoid
- Forgetting to budget for local marketing because the brand has no marketing fee
- Underestimating the cost of hood, ventilation and fire suppression work
- Leaving too little working capital for the first months of payroll and inventory
- Choosing a site without studying delivery range, competitors and nearby schools and businesses
- Signing a lease before the lender and franchisor have reviewed it
- Assuming used equipment in a conversion will last without an inspection
For more pitfalls, read about the restaurant loan mistakes that cost owners the most.
Next Steps to Finance Your Fox’s Pizza Den Franchise
Step 1: Confirm you qualify. Make sure you have at least $40,000 in liquid assets and can pass a credit check.
Step 2: Review the FDD with advisors. Study Items 5, 6, 7, 10, 17 and 19 and the franchise agreement with a franchise attorney and accountant.
Step 3: Talk with a financing specialist early. Pre-qualify for funding and learn how lenders will size your loan.
Step 4: Find a site. Work with the franchisor on location, demographics and lease terms.
Step 5: Build your plan. Gather contractor and equipment quotes and prepare projections with the flat royalty and your own marketing budget.
Step 6: Apply for financing. Submit your loan request with financial statements, tax returns, projections, the lease and franchise documents.
Step 7: Close and open. Coordinate closing with the build-out, train your team with the franchisor’s opening crew and keep working capital in reserve.
Fox’s Pizza Den Franchise Loan FAQs
How much does it cost to open a Fox’s Pizza Den?
The franchisor states that the total investment to begin operation ranges from $108,800 to $236,000. Conversions of existing pizza shops may cost less.
What is the Fox’s Pizza Den franchise fee?
The franchise fee is $20,000, plus $16,000 for site consulting, project management, training and grand opening setup. Veterans receive 50% off the franchise fee, and the Conversion Plus program currently offers a 50% discount.
What royalty does Fox’s charge?
A flat $500 per month, not a percentage of sales. The franchisor says it does not charge a marketing fee.
How much liquid capital do I need?
The franchisor lists liquid assets of $40,000 or more. Lenders will also look at your total financial picture and reserves.
Can I get an SBA loan for a Fox’s Pizza Den?
Yes, subject to lender approval. Fox’s is listed on the SBA Franchise Directory under code S0666, and the franchisor says its lender relationships include working with SBA financing.
Does Fox’s offer financing?
No. The franchisor says it does not offer financing but has relationships with outside lenders. Check Item 10 of the FDD for any financing disclosures.
Can I convert my pizza shop to a Fox’s?
Yes. The Conversion Plus program is designed for independent stores and small businesses and currently includes a 50% franchise fee discount.
Can a first-time owner get a Fox’s Pizza Den franchise loan?
Yes, if the franchisor approves the candidate and the borrower meets lender requirements. Restaurant or management experience and cash reserves strengthen the application.
How long is the franchise term?
The term, renewal and transfer conditions are set out in Item 17 of the current FDD. Lenders prefer a franchise term that extends well beyond the loan term.
Does the FDD include financial performance information?
Review Item 19 of the current FDD to see whether it includes financial performance representations, and rely on actual financial statements when buying or converting an existing store.
Final Thoughts
A Fox’s Pizza Den offers a modest entry point into pizza franchising, and its flat royalty makes cash flow easier to plan. Owners who budget for their own marketing, keep enough working capital and choose a strong site put themselves in a good position to borrow, open and grow.
US Professional Funding helps franchise owners finance start-ups, conversions, equipment, acquisitions and working capital. Learn more about our franchise financing and restaurant financing solutions.
