How to Finance a Giovanni’s Pizza Franchise: 1.5% Royalty Model
By Marc Cornella
A Giovanni’s Pizza franchise loan finances a family-owned pizza shop in one of the small towns and regional markets of Appalachia and the Ohio Valley, where the brand has grown for decades by franchising to local operators. With a low published royalty and flexible building standards, the main financing questions are the site, the kitchen and enough working capital to carry the shop to steady sales.
US Professional Funding is not affiliated with, sponsored by or endorsed by Giovanni’s Pizza; the name is used only to describe the business. Figures from the franchisor’s disclosure document and website can change, loan programs vary, and every loan is subject to approval. Nothing here is legal, tax or investment advice. Review the current Franchise Disclosure Document (FDD) and franchise agreement with a franchise attorney and an accountant before you sign.
Giovanni’s Pizza Franchise Loan at a Glance
- Royalty: Giovanni’s franchising page lists a royalty of 1.5%.
- Franchise fee: described by the company as a small fee, without a published dollar amount. Confirm it in Item 5 of the current FDD.
- System size: the company reports nearly 100 stores across six states: Kentucky, Ohio, West Virginia, Virginia, Tennessee and North Carolina.
- Headquarters: Ashland, Kentucky.
- Growth markets: eastern Kentucky, southern Ohio, West Virginia, northern Tennessee, southwest Virginia and northwest North Carolina.
- Menu support: franchisees get access to more than 60 signature food products and training on how to prepare them.
- Investment and requirements: the estimated initial investment, advertising contributions and any net worth or liquidity minimums are not published on the franchising page. Request the current FDD.
- SBA Franchise Directory: listed as “Giovanni’s Pizza” under code S4739, with no additional notes.
What Is Giovanni’s Pizza?
Giovanni’s Pizza is a family-owned pizza chain with roots in southern Ohio and eastern Kentucky. According to the company’s history, James “Jim” Lemaster and his wife, Nancy, opened their first pizza restaurant in Wheelersburg, Ohio, after noticing how few pizza places served the area. In 1967 they sold that restaurant to Jim’s brother and opened a new location in Ashland, Kentucky. After running the Ashland store for three years, Jim sold it to focus on building a franchised chain.
A franchise system built on local owners. The company says Jim preferred to award franchises to local, hands-on families rather than to investors looking for quick returns. That approach still shows: the company describes its stores as individually owned, and its oldest franchise, in St. Paul, Virginia, opened in 1977 and is still managed by the founding franchisee’s family.
Food first, flexible buildings. Giovanni’s says it does not require uniform buildings or decor and instead focuses on food quality, summed up in the brand’s “Quality Without Compromise” tagline and its “Pizza Power” community message. Jim also started an Italian food wholesale operation to supply franchisees, so the system has long controlled its signature ingredients.
How lenders view the brand. Giovanni’s is a long-established regional chain, not a national one. Lenders will appreciate its decades of franchising history and SBA directory listing, but they will still underwrite each shop on the borrower’s experience, the local market and realistic projections.
Giovanni’s Pizza Franchise Costs
Because the franchising page does not publish an investment range, build your budget from the current FDD and quotes for your specific site.
Initial franchise fee. The company calls its fee small and says it has some of the lowest fees in the industry. The exact amount is in Item 5. It can usually be included in a loan request, but it must appear in your sources and uses.
Real estate and build-out. Because Giovanni’s does not require a uniform building, an owner may be able to adapt an existing restaurant, a former pizza shop or a small retail building rather than build to a rigid prototype. That flexibility can lower costs, but older buildings in small towns can hide expensive issues with ventilation, grease handling, electrical service and accessibility. Our article on financing a restaurant build-out explains how construction is funded.
Kitchen equipment. A pizza kitchen typically needs pizza ovens, dough mixers, make lines and prep tables, walk-in and reach-in refrigeration, a hood and fire suppression system, and point-of-sale and online ordering technology. The company says franchisees benefit from nationally negotiated equipment and supply pricing.
Opening costs and working capital. Opening inventory, hiring and training, local marketing, insurance, licenses and the first months of payroll and rent all require cash before the shop builds a customer base.
Item 7 of the FDD will typically group costs into lines like these:
- Initial franchise fee
- Lease deposits or real estate costs
- Leasehold improvements and construction
- Ovens, mixers, refrigeration and kitchen equipment
- Furniture and fixtures for any dining area
- Signage
- Point-of-sale and online ordering systems
- Opening food inventory and supplies
- Training and pre-opening payroll
- Licenses, permits, insurance and professional fees
- Additional funds for the initial operating period
Check that the line items add up to the stated total and note the store format Item 7 describes.
Ongoing Fees and How They Affect Your Loan
Royalty. At 1.5%, the royalty listed on the franchising page is low by restaurant franchise standards. That leaves more of each sales dollar available for rent, labor, food costs and debt service, which can help a loan’s coverage math.
Advertising and other fees. Item 6 of the FDD lists any advertising fund, local marketing requirement, technology fees, transfer fee and renewal fee. Ask whether online ordering, rewards or point-of-sale systems carry separate charges.
Product purchasing. Because signature ingredients flow through the brand’s own supply system, food cost is driven partly by the franchisor’s pricing. Review Item 8 of the FDD for required purchases and any revenue the franchisor earns from them.
How lenders treat these fees. Lenders calculate debt service coverage after royalties, advertising, rent, food and labor. A low royalty helps, but a Giovanni’s Pizza franchise loan still has to be sized on realistic local sales rather than system highlights.
Franchisor Requirements for New Owners
Giovanni’s does not publish net worth or liquid capital minimums on its franchising page. Ask for the written requirements and review the FDD.
Local, hands-on owners. The company’s history emphasizes local families who work in their stores. Expect the franchisor to look for owners who will be present and active in the community.
Approval process. The franchising page describes a path that runs through location selection, interior layout design, equipment and supply purchasing, training for the owner and employees, operational procedures and access to the signature products. Interested candidates start with an inquiry to the franchise team.
Training and support. The company offers in-store training, a learning management system, operations manuals and a franchise portal, plus ongoing help with marketing, supply chain, technology, financial guidance, quality audits and community engagement.
Ways to Own a Giovanni’s Pizza
Open a new store. A new shop in one of the brand’s growth markets gives you control over the location but carries a ramp-up period. Our restaurant start-up financing page covers how new openings are funded.
Convert an existing restaurant. With no uniform building requirement, a closed pizzeria or small restaurant with a hood and grease trap may be a cost-effective starting point, subject to franchisor approval.
Buy an existing Giovanni’s. Many stores have operated for years under the same family, so resales may come up as owners retire. Lenders will rely on the store’s historical sales and tax returns. See our pages on franchise restaurant acquisition financing and buying a franchise resale.
Financing Options for a Giovanni’s Pizza Franchise
SBA 7(a) loans. An SBA 7(a) loan can combine the franchise fee, renovation, equipment and working capital, and can include real estate. Explore our SBA 7(a) loan options.
SBA 504 loans. In small towns, buying a modest freestanding building is often realistic. The SBA 504 program is designed for owner-occupied real estate and long-lived equipment.
Conventional term loans. Owners with strong credit, collateral and restaurant experience may use a conventional business loan, particularly for a resale or a second store.
Equipment financing. Pizza ovens, mixers, refrigeration and point-of-sale systems can be financed separately. Learn more about restaurant equipment financing and leasing.
Working capital and lines of credit. Pizza sales often rise with school sports seasons, holidays and community events, and fundraising nights can bring busy weeks. A line of credit helps cover payroll and food orders through slower stretches. See our restaurant working capital solutions.
Seller financing on resales. A retiring owner may agree to carry a note for part of the price. Seller notes are typically subordinate to the primary loan, and some loan programs limit how they can be structured.
SBA Loans for Giovanni’s Pizza Franchisees
SBA-guaranteed loans are made by participating lenders, with the SBA guaranteeing a portion of the loan. For a franchise, the lender checks the SBA Franchise Directory to confirm the brand’s agreements are eligible.
Directory status. Giovanni’s Pizza is listed on the SBA Franchise Directory under code S4739, with no additional notes. In plain terms, an SBA-backed Giovanni’s Pizza franchise loan needs no extra brand-specific documents beyond standard SBA requirements, although the lender will still review your franchise agreement and FDD.
Program size. The SBA 7(a) program maximum is currently $5 million (program rules can change), which is generally ample for a single pizza shop and its building.
SBA application tips.
- Provide the full FDD and the franchise agreement.
- Include contractor bids and equipment quotes organized like Item 7.
- Show your food service or management experience in a detailed resume.
- Build projections around local population, competition and seasonality.
- Estimate payments with our SBA loan calculator.
How Lenders Evaluate a Giovanni’s Pizza Deal
Personal credit and financial history. Lenders review your credit, tax returns and obligations, and usually require a personal guarantee.
Net worth and liquidity. Expect to contribute equity and keep reserves after closing.
Industry and management experience. Pizza or restaurant experience carries weight. Owners new to food service should lean on the franchisor’s training and hire an experienced shift lead.
Business plan and projections. Base assumptions on the town’s population, the mix of dine-in, carry-out and delivery, average ticket, food and labor costs and community events. Lenders know small markets can be loyal but limited.
The FDD and franchise agreement. Lenders review fees, territory, term, renewal and transfer terms. Read our article on how the FDD affects franchise financing.
Site, lease or real estate. Lenders want a lease that covers the loan term or, if you are buying, an appraisal and environmental review.
Historical financials for resales. Expect to provide several years of sales reports, tax returns and profit and loss statements for an existing store.
Kitchen and Building Considerations
- Older buildings: budget for updated ventilation, electrical service, plumbing and accessibility work.
- Oven capacity: size ovens for Friday nights and game days.
- Delivery and carry-out flow: plan a pickup area and delivery staging that keep orders moving.
- Technology: online ordering and the rewards program depend on reliable point-of-sale systems.
Multi-Unit Growth
Owners who succeed with one store may add another in a nearby town. Lenders usually finance each store separately and use the first store’s results to support the next. Confirm with the franchisor how additional territories are awarded.
Real-World Scenarios
The hometown operator. A local restaurant manager converts a closed pizzeria into a Giovanni’s using an SBA 7(a) loan for the franchise fee, renovation, equipment and working capital.
The second-generation buyer. A long-time employee buys a store from a retiring owner with an SBA loan, personal equity and a subordinate seller note, subject to franchisor approval.
The building owner. An operator buys a small freestanding building with an SBA 504 loan and finances the ovens separately.
Common Mistakes to Avoid
- Underestimating the cost of updating an older building.
- Overestimating sales in a small market.
- Ignoring required purchases when modeling food cost.
- Leaving too little working capital for the first months.
- Signing a lease shorter than the loan term.
Learn more in our article on restaurant loan mistakes.
Next Steps to Finance Your Giovanni’s Pizza Franchise
Step 1: Contact the franchise team. Submit an inquiry and request the current FDD.
Step 2: Review the FDD. Study Items 5, 6, 7, 8, 10, 17 and 19 with a franchise attorney.
Step 3: Choose a site. Compare existing restaurant spaces and buildings in the brand’s growth markets.
Step 4: Gather documents. Collect tax returns, a personal financial statement, a resume and contractor and equipment quotes.
Step 5: Build projections. Model sales channels, food cost, labor and local seasonality.
Step 6: Apply and coordinate closing. Align franchise approval, lease or purchase and loan closing.
Giovanni’s Pizza Franchise Loan FAQs
How much does a Giovanni’s Pizza franchise cost?
The franchising page does not publish an investment range. The estimated initial investment is in Item 7 of the current FDD and depends heavily on the building you choose.
What royalty does Giovanni’s charge?
The company’s franchising page lists a 1.5% royalty. Confirm all ongoing fees in Item 6.
What is the Giovanni’s franchise fee?
The company describes it as small but does not publish the amount. It is disclosed in Item 5.
Is Giovanni’s Pizza eligible for SBA loans?
Yes. The brand is listed on the SBA Franchise Directory under code S4739 with no additional notes. Approval still depends on your qualifications.
Where is Giovanni’s expanding?
The company lists eastern Kentucky, southern Ohio, West Virginia, northern Tennessee, southwest Virginia and northwest North Carolina.
Do I need a specific building design?
The company says it does not require uniform buildings or decor, which can make conversions practical, subject to franchisor approval.
Can I finance the ovens separately?
Yes. Equipment financing or leasing can cover ovens, mixers and refrigeration apart from your main loan.
Can I buy an existing store?
Yes, if an owner is selling and the franchisor approves the transfer.
Does Giovanni’s offer financing?
Item 10 of the FDD discloses whether the franchisor offers any financing.
How long is the franchise term?
The term, renewal and transfer conditions are in Item 17 of the FDD.
Final Thoughts
A Giovanni’s Pizza franchise loan backs a brand with a low published royalty, flexible building standards and a long history of local ownership. Buyers who verify the FDD, budget carefully for the building and keep healthy working capital will be well positioned to open or buy a store.
US Professional Funding helps franchise owners finance start-ups, acquisitions, equipment and working capital. Learn more about our franchise financing and restaurant financing solutions.
