FREQUENTLY ASKED QUESTIONS
Describe in detail what your business will do and what product and service it will provide?
The business will be a take-out and sit in restaurant. All franchisees will operate as Pita Nutso and follow the methods of operation, promotion and customer service. Customers will be able to place an order by either walking into the store or through calling the local phone number which will be utilized as well for catering orders. Online ordering will also be available in the near future.
Who are your major competitors in Ontario?
Explain why customers will prefer your product to that of your competitors?
Pita Nutso is a “Quick Serve Quality Cuisine” concept that caters to a variety of clientele. Pita Nutso’s menu offers an array of flavourful dishes. A few of the unique dishes we carry are called “On The Rocks”, “On Ice” and “The Works”. These dishes can be made with different types of meat and the most popular one is our “World Class Shawarma” which is our proprietary marinated chicken. Our special combination of herbs and spices we use in the marinade make our product stand out from our competitors.
The method of cooking is crucial to our product since the meat is cooked using a special Middle Eastern vertical barbecue grill. The meat is cooked on a vertical skewer so that any fat on the chicken drips down off into the drip pan. The chicken cooks slowly as it rotates in a circular motion to ensure an even and consistent finished product.
Our Shawarma can be served in our grilled pita or as an entrée with rice, salad or hummus and topped with our most famous regular garlic or spicy hot sauce. We use only Halal meat which is federally inspected to ensure the highest quality possible. In addition, Pita Nutso selects top locations to place our restaurants, such as high traffic malls, plazas, located at busy intersections and near schools, universities and businesses.
What market research have you conducted to determine how many potential customers are in the areas you plan to operate?
The primary target market for our concept is families residing in Ontario. Ontario has a population of over 11 million people. There are approx. 2.5 million (+) households and 500,000 (+) businesses in this geographical area. Many customers in southwestern Ontario currently associate the name “Pita Nutso” with good food and value for their dollar when it comes to healthy Middle Eastern cuisine.
Pita Nutso currently has a good market share in the existing territories we are currently operating in. The average customer orders once every 10 days. We estimate the sales break down to be 90% regular walk-in traffic and 10% walk-in catering business. The average order value is currently $10.00 (before taxes).
What are the characteristics of your typical customer?
Age ranges between 16 to 50 equally distributed between male and female. 85% of customers live in homes and 15% of customers live in apartments.
How will you inform customers about your service or product?
We will be distributing locally on a weekly basis, flyers and direct door to door marketing promos. In addition, we also promote our product through newspaper advertisements as well as mobile billboards.
What form of advertising would be most effective?
The most effective forms of advertising are word of mouth and the distribution of flyers directly to the customers. We also make a point to introduce ourselves to community institutions, schools and hospitals and offer them special discounted programs. Other forms of advertising include radio campaigns coordinated through the Franchisor from time to time.
How much do you intend to spend on advertising and what have you
An initial distribution of one flyer per household within the immediate trading area (approx. 5,000 homes). The local advertising budget is set out at 2% of net sales per calendar week as per Franchise Agreement.
What does it cost you to offer your product(s) or service(s) to your customers?
Wages = 25%
Rent = 9%
Business Taxes = 4%
Ad Fund Fee = 4%
Utiliies & Phone = 1%
Royalty Fees = 5%
Business Loan = 5%
Food & Packaging Costs = 37%
What level of net sales would you have to reach to breakeven?
$700.00/net sales per day averaging 70 customers at a $10.00 average ticket.
What is the typical size of a location and who will be on the Head Lease?
Pita Nutso Restaurants vary in size from 750 sq.ft. to 1,250 sq.ft. The premises will be leased on a monthly basis and the Head Office will be on the Head Lease. The Head Office will then sublet the location to the licensed franchisee for a term of up to 10 years.
What skills are required and who will provide them?
Skills required to run a Pita Nutso restaurant involve a good and fun attitude, good work ethics and the willingness to work hard. Each manager or staff will require a 4-week training period .
How many employees will you need to hire?
Number of Employees At Start-Up By Year 3
Full-time 2 3
Part-time 3 4
Are all franchises under patents, trademarks and licensing agreements?
All Pita Nutso Restaurants will operate under the trademark of Pita Nutso. Each franchise will operate under the license of Pita Nutso trademarks, trade marketing and operations and recipes exclusively.
What’s the cost of a Pita Nutso restaurant the including working capital.
A typical turn-key cost for a 1,000 sq.ft. location would be approx. $180,000.00 plus $20,000.00 (soft costs including deposits, working capital, grand opening advertising). The total cost would be approx. $200,000.00 CND.
What would be the down payment required?
The minimum encumbered cash required would be $90,000.00 CND.
What would be the amount of the Bank loan required?
The Bank loan would range from $110,000.00 to $160,000.00 CND (including the 2% government fee) depending on the size and location of the restaurant.