About South Philly Steaks & Fries or South Philly Cheesesteaks & Fries Franchise
South Philly Steaks & Fries, also known as South Philly Cheesesteaks & Fries, is a fast service restaurant franchise offering authentic Philadelphia style cheesesteaks, specialty sandwiches, french fries, onion rings, and related food and beverages.
The franchise fee is $25,000 domestically and $35,000 for locations outside the continental United States.
The brand has been franchising since 1986 under Villa Pizza, Inc.
South Philly Steaks & Fries or South Philly Cheesesteaks & Fries Franchise Cost & Fees
Minimum Investment
$321K
Average Investment
$464K
Maximum Investment
$607K
| Fee Type | Amount | Notes |
|---|---|---|
| Initial Franchise Fee | $25,000 | One-time payment upon signing |
| Royalty Fee | 5% of Gross Sales of gross sales | Ongoing; paid monthly |
| Marketing/Ad Fund | Current: 1% of Gross Sales Maximum 3% of Gross Sales | National brand fund |
| Total Investment Range | $321,000 – $607,000 | Includes build-out, inventory, working capital |
The investment range of $321K–$607K reflects variability in build-out costs, store size, lease terms, and market. The combined royalty (5% of Gross Sales) and marketing fee (Current: 1% of Gross Sales Maximum 3% of Gross Sales) are ongoing costs paid as a percentage of gross sales.
Investment Breakdown (Item 7)
| Item | Low | High |
|---|---|---|
| Franchise Fee | $25,000 | $35,000 |
| Equipment and Furnishings | $100,000 | $130,000 |
| Signs | $9,000 | $15,000 |
| Real Estate | $0 | $0 |
| Building Construction | $125,000 | $300,000 |
| Insurance | $3,000 | $6,000 |
| Opening Inventory | $5,000 | $10,000 |
| Utility Deposits | $2,000 | $2,000 |
| Business Licenses (local health & safety regulation and compliance costs) | $1,000 | $4,000 |
| Travel, Lodging and Meals for Initial Training | $3,000 | $5,000 |
| Grand Opening Advertising | $0 | $0 |
| Professional Fees | $10,000 | $25,000 |
| Additional Funds (three months) | $25,000 | $50,000 |
| Computer Equipment | $10,000 | $20,000 |
| Advertising and Marketing | $3,000 | $5,000 |
Additional Fees (Item 6)
| Fee Type | Amount |
|---|---|
| Transfer Fee | $10,000 or the greater of the Transfer Fee or Franchisor’s actual costs |
| Renewal Fee | 50% of the then-current Initial Franchise Fee |
| Technology Fee | $1,100 - $1,500 per year (Point of Sale system maintenance/help desk fee); $750 per year, per terminal (SAAS fee) |
| Audit Fee | Cost of audit; interest due; $500 adjournment fee |
| Local advertising payment | 3% of Gross Sales |
| Site evaluation | Out-of-pocket expenses for visiting and inspecting proposed site |
| Design and construction assistance expense | $250 - $750 |
| Costs and attorneys’ fee | Will vary under circumstances |
| Interest on overdue payments | Lesser of 1½ % per month or maximum rate permitted by law |
| Conversion fee prior to the end of the term of the Franchise Agreement | 10% of the then-current Initial Franchise Fee of the concept to which you wish to convert |
| Additional Assistance | $100 for each person per day |
Training Program (Item 11)
| Detail | Information |
|---|---|
| Total Duration | Two 50-60 hour six-day work weeks (approximately 2 weeks) |
| Classroom Training | 6-12 hours |
| On-the-Job Training | 133 hours |
| Training Location | Bethlehem, PA or another designated training facility |
| Additional Training | Mandatory supplemental training courses/seminars for franchisee and manager(s), periodic marketing training for other employees (franchisee pays wages, travel, living expenses). Voluntary supplemental training courses/seminars for franchisee, manager(s), and other employees (franchisee pays all costs). Subscription to iLEARN Center ($20.00/month). |
Territory Rights (Item 12)
| Detail | Information |
|---|---|
| Territory Type | Non-exclusive |
| Exclusive Territory | No |
| Description | Franchisee is granted the right to operate one restaurant at a specific approved location and will not receive an exclusive territory. Franchisee may face competition from other franchisees, company-owned outlets, or other distribution channels/competitive brands controlled by the franchisor. The franchisor retains all rights to operate and grant franchises for its concepts anywhere in the world and to sell products through various channels (e.g., groceries, stadiums) without compensation to the franchisee. |
Renewal, Termination & Transfer (Item 17)
| Detail | Information |
|---|---|
| Initial Term | 10 years |
| Renewal Term | 1 additional 10-year term |
| Renewal Fee | 50% of the then-current Initial Franchise Fee |
| Renewal Conditions | Franchisee must give written notice 9-12 months prior to expiration, not be in default, have cured any prior defaults, not be a sublessee (unless waived), and execute the then-current franchise agreement and other documents, including a general release and personal guarantees. Franchisee must also maintain possession of premises and upgrade equipment/fixtures/design to current standards. |
| Transfer Fee | $10,000 or the greater of the Transfer Fee or Franchisor’s actual costs |
| Transfer Conditions | Transferee must be of good moral character, have good credit, sufficient business experience and financial resources, and meet franchisor's standards. Transferee must demonstrate ability to operate, execute new franchise agreements/guarantees, and pay all outstanding obligations to franchisor. Franchisor must approve economic terms, and any financing by franchisee must be subordinate to franchisor's fees. Premises must be repaired/renovated to current standards, and transferee must attend training. Franchisee must pay an 8% sales commission if franchisor obtained the purchaser. |
| Termination for Cause | Immediate termination without cure opportunity for: failure to commence/cease operation, loss of premises (unless eminent domain/disaster and relocation approved), felony conviction or crime affecting System/Marks/goodwill, threat to public health/safety, unauthorized transfer of rights, failure to comply with in-term covenants, disclosure of confidential information, or failure to effect approved transfer after death/incapacity. Termination with 10-30 days notice for curable defaults like failure to pay monies, failure to maintain standards, changing food system, closing restaurant without approval, continued legal violations, or failure to obtain prior written approval. |
| Non-Compete Period | 2 years |
| Non-Compete Details | During the term of the franchise, the franchisee (and owners/officers/directors/5%+ beneficial interest holders) cannot divert business to competitors, or own/invest in/be employed by any business selling similar food/beverages (e.g., cheese steaks, fresh cut fries) as the franchised restaurant. After termination or expiration, for two years, the franchisee (and restricted persons) cannot have any direct or indirect interest in a competitive business operating at the former premises, within a 5-mile radius of the former premises, or within a 5-mile radius of any other franchised restaurant under the Marks. |
Operations & Supply (Items 8 & 15)
| Detail | Information |
|---|---|
| Owner-Operator Required | No |
| Participation Details | The restaurant must always be under the direct supervision of a full-time Manager (who may be the franchisee) who has completed the franchisor's training program. The franchisor recommends personal participation in the actual management and operation of the Franchised Business. If the franchisee is a corporation, all officers, directors, and holders of 5% or more beneficial interest must devote requisite time, energy, and best efforts and guarantee obligations. |
| Required Suppliers | Proprietary products from Approved Suppliers: Ferraro Foods, PFG, Tapia Brothers, and Kaleel Brothers. Frozen yogurt mix and pretzel dough are exclusively from franchisor/affiliates. Certain food items and equipment may also be from franchisor/affiliates. |
| Supply Restrictions | Franchisee must purchase or lease most items solely from approved suppliers meeting franchisor's standards and specifications. Approval for unapproved suppliers requires written request, inspection of facilities, and testing of samples at franchisee's or supplier's expense. Franchisor may revise standards and specifications over time. |
| Franchisor Revenue from Suppliers | Approximately $100,000 in 2022 from miscellaneous purchases. An administrative fee averaging 6% of sales by Approved Suppliers to the Franchised Business. Rebates from beverage suppliers for marketing and promotional programs, price protection, new restaurant vendor rebates, growth incentives, and packaged beverage product marketing programs. |
Financing (Item 10)
| Detail | Information |
|---|---|
| Financing Available | No |
| Description | The franchisor does not offer direct or indirect financing. They do not receive payments from lenders for placing financing. They cooperate with Small Business Administration (SBA) approved lenders to help process SBA funding. The franchisor does not customarily guarantee notes, leases, or other obligations to third parties, but may provide limited lease guarantees in exceptional situations if the franchisee has acceptable credit. |
South Philly Steaks & Fries or South Philly Cheesesteaks & Fries Franchise Earnings — Item 19
Average Revenue
$884K
Median Revenue
$1.0M
Revenue Range
$395K – $1.3M
Sample Size
5 units
Past financial performance does not guarantee future results. Individual results will vary.
South Philly Steaks & Fries or South Philly Cheesesteaks & Fries Litigation & Risk Flags
3 Pending Actions ListedReview the full FDD for details on pending litigation.
Bankruptcy History DisclosedA bankruptcy disclosure is present in this FDD.
Litigation and bankruptcy data is sourced from Items 3 and 4 of the FDD. Always verify current status directly from the most recent FDD.
South Philly Steaks & Fries or South Philly Cheesesteaks & Fries System Growth
Total Units
6
Franchised
1
Company-Owned
5
South Philly Steaks & Fries or South Philly Cheesesteaks & Fries currently operates 1 franchised locations and 5 company-owned units. Unit count data is sourced from Item 20 of the FDD.
Unit History (Item 20)
| Year | Opened | Closed | Total |
|---|---|---|---|
| 2020 | 1 | 9 | 8 |
| 2021 | 1 | 2 | 6 |
| 2022 | 0 | 0 | 6 |
Transfers: 0 | Closures: 8
State Registrations
Registered in 15 states: CA, IL, IN, MD, MI, MN, NY, ND, RI, SD, VA, WA, WI, HI, OR
Franchisor Financials (Item 21)
Revenue
$764K
Net Income
$330K
Total Assets
$912K
Audited by Citrin Cooperman & Company, LLP for year ending December 25, 2022.
South Philly Steaks & Fries or South Philly Cheesesteaks & Fries Franchise — FAQ
The total investment to open a South Philly Steaks & Fries or South Philly Cheesesteaks & Fries franchise ranges from $321,000 to $607,000, per their Franchise Disclosure Document. This includes the initial franchise fee of $25,000. The investment covers build-out, inventory, equipment, signage, working capital, and other startup costs.
South Philly Steaks & Fries or South Philly Cheesesteaks & Fries charges a royalty fee of 5% of Gross Sales of gross sales, plus a Current: 1% of Gross Sales Maximum 3% of Gross Sales contribution to the marketing/advertising fund. These fees are paid on an ongoing basis.
You can download the South Philly Steaks & Fries or South Philly Cheesesteaks & Fries Franchise Disclosure Document free on this page. The FDD is a public document filed with state franchise registries. Always also request the current FDD directly from South Philly Steaks & Fries or South Philly Cheesesteaks & Fries to ensure you have the most up-to-date version.
According to the Item 19 financial performance representation in their FDD, South Philly Steaks & Fries or South Philly Cheesesteaks & Fries franchise owners report average revenue of $884K and median revenue of $1.0M. This is based on a sample of 5 units. Past performance does not guarantee future results.
South Philly Steaks & Fries or South Philly Cheesesteaks & Fries has been franchising since 1986. The FDD shows an investment range of $321,000-$607,000, a 5% of Gross Sales royalty, and includes an Item 19 earnings disclosure. There are 3 pending litigation action(s). Review the full FDD and contact current franchisees listed in Item 20 before making any investment decision.
The franchise fee is $25,000 and the total investment ranges from $321,000 to $607,000 depending on location size and market. Contact the franchisor directly for current net worth and liquid capital requirements, territory availability, and application details.
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