2026 FDD Issued Mar 27, 2026 Minnesota Commerce (CARDS) Checked Nov 2, 2026
Papa Murphy's Franchise Cost (2026)
A Papa Murphy's franchise costs an estimated $450,330 – $693,450 to open, according to Item 7 of the 2026 Franchise Disclosure Document (FDD). That total includes the $25,000 initial franchise fee (Item 5) and covers this format: Franchised Store. Item 6 lists royalty fee: 5% of Net Sales, subject to the conditions below.
- Total investment
- $450K – $693KItem 7 source and qualifications
- Franchise fee
- $25KItem 5 source and terms
- Royalty
- 5% of Net SalesItem 6 conditions and fee bases apply
- Brand fund
- 2% of Net SalesItem 6 conditions and fee bases apply
- Units (2025)
- 1,014Item 20 source and scope
- Franchise exit rate
- 6.4% / yrCalculated 3-year average; definition and source
What stands out about Papa Murphy's
The franchised network is shrinking through terminations. Item 20 shows the franchised count falling in each year to 965 at the end of 2025, with terminations far outnumbering the few openings, and in one year the franchisor took back dozens of stores and reopened others as its own. Company-owned stores grew from a small base as a result. A buyer should ask why so many agreements ended and how the company stores are doing.
Item 19 covers every franchised store open a full year, and average net sales of $687,539 have barely moved across the three years shown, while the number of stores in the sample fell. Sales spread widely between the top and bottom tenths. Item 6 notes that some stores pay a reduced royalty under assistance programs, so not every location pays the standard 5% of Net Sales rate.
Local marketing is a floor, not a guideline. Owners must spend the greater of a percentage of sales or a fixed monthly dollar amount, and regional cooperatives can set a higher rate. Several small monthly technology charges and per-transaction fees for online orders and gift cards add to the costs a single sales figure cannot capture.
What are the initial franchise fees and financial requirements for Papa Murphy's?
Item 5 lists an initial franchise fee of $25,000 for Papa Murphy's. Check the cited Item 5 for payment timing, discounts and format-specific terms.
Item 5 (PDF pages 27-28): the Initial Franchise Fee is $25,000 for a first store and the Subsequent Franchise Fee $15,000 for each additional store, paid at signing and non-refundable; fees in the fiscal year ended November 30, 2025 ranged from $0 to $25,000. Military, veteran and Heroes Program (police, medical and fire) candidates may pay a reduced fee. A lease guaranty, if granted, costs 10% of the guaranteed rent up to $10,000, and a six-month opening extension costs $2,500. Under a Development Billing Agreement you may reimburse the franchisor $188,950 to $240,300 it pays to build-out and opening vendors.
Source: Papa Murphy's 2026 FDD, Item 5, PDF p. 27.
This record lists no minimum net worth or liquid-capital requirement for Papa Murphy's, because no sourced figure has been recorded. Ask the franchisor for its current financial qualifications in writing.
How much does it cost to open a Papa Murphy's franchise? (Item 7)
Source: Papa Murphy's 2026 FDD, Item 7, PDF p. 36.
Item 7 of Papa Murphy's 2026 Franchise Disclosure Document estimates the total cost to open one franchised store at $450,330 – $693,450. This total includes the initial franchise fee.
| Expense Category | Low ($) | High ($) |
|---|---|---|
| Initial or Subsequent Franchise Fee | $15,000 | $25,000 |
| Lease and Utilities Deposits | $3,000 | $7,500 |
| Leasehold Improvements | $210,500 | $325,000 |
| Signs | $10,000 | $25,000 |
| Stamped Architectural Drawings | $11,150 | $13,050 |
| As Built Survey | $2,800 | $5,000 |
| Opening Package (including equipment) | $160,000 | $173,000 |
| Miscellaneous Development Costs | $0 | $1,270 |
| Inventory | $5,000 | $9,600 |
| Initial Marketing Fees and Expenses | $15,000 | $15,000 |
| Franchise Premises Rent – 3 Months | $4,500 | $17,500 |
| Materials and Supplies | $500 | $2,000 |
| Operations In-Store Training | $0 | $750 |
| Travel and Living Expenses | $1,180 | $9,305 |
| Employee Training | $500 | $1,500 |
| Insurance – 3 Months | $375 | $1,175 |
| Bookkeeping/Payroll Service | $825 | $1,800 |
| Lease Guaranty Fee | $0 | $10,000 |
| Additional Funds, Working Capital | $10,000 | $50,000 |
| Total | $450,330 | $693,450 |
For comparison, the median high-end investment among 25 restaurants & food records without a source-review hold is $1,297,100.
Item 7 (PDF pages 36-38) prints $450,330 to $693,450 for one store; its 19 lines add to that total. The franchise fee line runs from the $15,000 subsequent-store fee to the $25,000 first-store fee, so the low total assumes an additional store. Leasehold improvements and the opening equipment package are the largest lines; leasehold costs averaged $166 per square foot in 2025.
What ongoing royalties and fees does Papa Murphy's charge? (Item 6)
Source: Papa Murphy's 2026 FDD, Item 6, PDF p. 28.
Item 6 of Papa Murphy's 2026 FDD lists the charges below. Recurring charges and charges triggered by a transfer, renewal or other event have different conditions. Read each fee’s basis and notes before comparing rates.
How to read an Item 6 fee table.
| Fee Type | Amount / Rate | Payment Frequency | Notes & Source |
|---|---|---|---|
| Royalty Fee | 5% of Net Sales | Every period | 5% of weekly Net Sales, deducted by ACH each week. Some stores pay less under assistance programs (note 2). (Item 6, PDF p. 28) |
| Brand Marketing Fee | 2% of Net Sales | Every period | Currently 2% of weekly Net Sales, deducted by ACH (note 4). (Item 6, PDF p. 29) |
| Local Marketing and Promotion and Regional Cooperative Advertising | Varies | Every period | At least the greater of 5% of Net Sales or $2,000 each month; cooperative contributions count toward it, and cooperatives currently charge up to 7.5% of Net Sales. Any shortfall is paid to the franchisor (note 5). (Item 6, PDF p. 29) |
| Online Ordering Fee | Varies | When it applies | $0.35 per online transaction, deducted weekly; may rise up to 5% a year. (Item 6, PDF p. 29) |
| Marketing Kits | Varies | When it applies | $45 to $500 as incurred (note 6). (Item 6, PDF p. 29) |
| Customer Relations Management | $10 per month | Every period | $10 per month, the part of the cost not covered by the Brand Marketing Fund (note 7). (Item 6, PDF p. 29) |
| Loyalty Program | $53 per month | Every period | $53 per month plus taxes (note 8). (Item 6, PDF p. 29) |
| Gift Card Redemption Fee | Varies | When it applies | 6.06% to 13.63% of the gift card amount redeemed, depending on the card type (note 9). (Item 6, PDF p. 29) |
| Food Service Incident Management | $3 per month | Every period | $3 per month (note 10). (Item 6, PDF p. 29) |
| Audit | Varies | When it applies | Audit costs if Net Sales were understated, plus unpaid fees and 18% interest (note 11). (Item 6, PDF p. 29) |
| Insurance | Varies | When it applies | Payable to the franchisor only if it buys required insurance you failed to obtain. (Item 6, PDF p. 30) |
| Transfer Fee | Varies | When it applies | For a buyer's first store, $25,000 less $2,500 for each full year left in the term, but at least $12,500; for an existing franchisee, $15,000 less $1,500 per remaining year, but at least $7,500. (Item 6, PDF p. 30) |
| Indemnification | Varies | When it applies | Costs of claims arising from your acts or omissions. (Item 6, PDF p. 30) |
| Additional Assistance or Training | Varies | When it applies | $100 to $300 per day, plus your travel and expenses. (Item 6, PDF p. 30) |
| Franchise Conventions | Varies | When it applies | $1,000 to $3,500, plus travel. (Item 6, PDF p. 30) |
| Convention Materials | Varies | When it applies | Up to $500 if you miss a Franchise Convention. (Item 6, PDF p. 31) |
| Successive Franchise Fee | Varies | When it applies | Half of the then-current Franchise Fee, 60 days before expiration. (Item 6, PDF p. 31) |
| Relocation Fee | $5,000 | When it applies | $5,000 if you relocate the store. (Item 6, PDF p. 31) |
| Non-Participation Fee | Varies | When it applies | $100 per day for refusing a required program, promotion or product test. (Item 6, PDF p. 31) |
| Document Administration Fee | $500 | When it applies | $500 when franchise documents must be amended, including an assignment. (Item 6, PDF p. 31) |
| Interest | Varies | When it applies | 1.5% per month (18% per year) unless limited by law. (Item 6, PDF p. 31) |
| Bookkeeping/Payroll Service | Varies | When it applies | $0 to $630 per month to a third-party vendor; a qualifying service is required for the first year (note 11). (Item 6, PDF p. 31) |
| Non-sufficient Funds Fees | Varies | When it applies | $35 plus the franchisor's bank fees. (Item 6, PDF p. 31) |
| POS Change of Ownership Fee | $500 | When it applies | $500 if you buy an existing store and keep its POS System (note 12). (Item 6, PDF p. 31) |
| Software License Transfer Fee | Varies | When it applies | $0 to $300 when buying an existing store. (Item 6, PDF p. 31) |
| Online Ordering Transfer Fee | $100 | When it applies | $100 when buying an existing store. (Item 6, PDF p. 31) |
| Store Solutions Team Support | $49 per month | Every period | $49 per month for required POS help desk support; subject to annual increases (note 14). (Item 6, PDF p. 31) |
| POS Software Support, Subscription, Maintenance and Hosting Fees | $95 – $600 per month | Every period | $95 to $600 per month depending on the POS configuration; subject to annual increases (note 13). (Item 6, PDF p. 31) |
| Late Payment Fee | $75 | When it applies | $75. (Item 6, PDF p. 31) |
| Managed Firewall Service/Network Security | $30 – $90 per month | Every period | $30 to $90 per month (note 17). (Item 6, PDF p. 31) |
| Business Class High Speed Internet Access | $50 – $200 per month | Every period | $50 to $200 per month to a third-party vendor. (Item 6, PDF p. 32) |
| Secure Payment Gateway and Related Technology | $11 – $25 per month | Every period | $11 to $25 per month, billed quarterly. (Item 6, PDF p. 32) |
| Upgrade, Refurbish and Replace | $4,000 – $50,000 | When it applies | $4,000 to $50,000 for required changes to premises, fixtures or equipment. (Item 6, PDF p. 32) |
| Expenses in Evaluating a Supplier Proposed by You | Varies | When it applies | The franchisor's reasonable evaluation expenses. (Item 6, PDF p. 32) |
| Step-In Costs | Varies | When it applies | Personnel and administrative costs plus 15% if the franchisor operates your store. (Item 6, PDF p. 32) |
| Early Termination Damages | Varies | When it applies | With six months' notice of early closing: the average monthly royalty and brand marketing fee for any 12 consecutive months in the prior 48, multiplied by the months remaining and divided by 2 (note 19). (Item 6, PDF p. 32) |
| Extension Fee | $2,500 | When it applies | $2,500 for an approved extension of up to six months to open. (Item 6, PDF p. 32) |
Explore annual fees and payback assumptions
This fee schedule cannot be reduced to the calculator’s simple sales-based formula. Enter your own assumptions and check them against the Item 6 terms.
Papa Murphy's startup investment and modeled fees over 10 years
Item 6 requires local marketing and cooperative advertising of at least the greater of 5% of Net Sales or $2,000 per month, and some charges are per online transaction or per gift-card redemption. A single annual sales figure cannot show which months reach the minimum or the transaction mix, so this record does not produce an annual fee estimate or payback preset. See the fee amounts and definitions in Item 6 above. Open the calculator with your own assumptions.
Item 20: Papa Murphy's franchised outlet history
Source: Papa Murphy's 2026 FDD, Item 20, PDF p. 73.
Item 20 Table 3 reports 965 franchised outlets at the end of 2025. The company-owned table reports a further 49 outlets. Our calculated average annual franchised exit rate is 6.4% across the 3 reported years, using the definition below.
| Year | Franchised at Start | Opened | Reported Exits | At End | Franchise Exit Rate (%) |
|---|---|---|---|---|---|
| 2023 | 1,145 | 19 | 45 | 1,119 | 3.9% |
| 2024 | 1,119 | 8 | 126 | 1,001 | 11.3% |
| 2025 | 1,001 | 4 | 40 | 965 | 4% |
Franchised units went from 1,145 to 965 over 3 years (-180).
Reported exits include terminations, non-renewals, franchisor reacquisitions and other cessations. A reacquired outlet may continue operating. How we calculate the exit rate. How to read the Item 20 outlet tables. Compare Papa Murphy's exit rate with other brands.
48 units changed owners in 2025.
Item 20 Table 3 totals (PDF page 73) match Table 1. Terminations are the main exit category and peaked in 2024, when the franchisor also reacquired 28 stores. Footnotes say eight stores closed by a franchisee in 2024 reopened as company-owned stores that year and eight more in 2025, which is why company-owned stores rose from 8 to 49.
How much do Papa Murphy's franchise owners make? (Item 19)
Source: Papa Murphy's 2026 FDD, Item 19, PDF p. 64.
Item 19 of the 2026 FDD reports franchise Store Average Net Sales of $687,539 (52 weeks ending September 24, 2025, All 947 domestic franchise-owned stores open the full 52 weeks; 384 exceeded the average). Papa Murphy's Item 19 reports sales but no profit, costs or owner pay. Rent, payroll, supplies, loan payments and Item 6 fees such as the royalty (5% of Net Sales) come out of sales before an owner is paid, so these figures cannot show what an owner earns.
See every Papa Murphy's Item 19 figure, with its period and sample.
Payback calculator (enter your own assumptions) Check any inputs against this record’s Item 7 startup costs and Item 6 fee rules.
How to interpret Papa Murphy's Item 19 figures and sample limits.
How long is the Papa Murphy's franchise agreement term?
Source: Papa Murphy's 2026 FDD, Item 17, PDF p. 60.
The standard Papa Murphy's franchise agreement runs 10 years, with renewal terms of 5 years.
Item 17 (PDF page 60): a ten-year term. If you meet the renewal conditions, the franchisor will offer an additional five-year term under its then-current agreement and a Successive Addendum, which may carry different terms such as a higher royalty.
How long does it take to open a Papa Murphy's franchise? (Item 11)
Source: Papa Murphy's 2026 FDD, Item 11, PDF p. 55.
Item 11 of the 2026 FDD states the time from signing the Franchise Agreement or first payment for the franchise to opening: about 210 days. The agreement requires you to open within one year after signing the Franchise Agreement.
Franchises with a similar investment range
These published records are selected by proximity to Papa Murphy's $450,330 low-end Item 7 investment, starting with Restaurants & Food. Formats, fees and source qualifications differ; the figures are not interchangeable budgets:
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Sources
Papa Murphy's International LLC Franchise Disclosure Document, issued March 27, 2026, as filed with the Minnesota Commerce (CARDS). Read the source FDD PDF. How to get this FDD yourself.
- Item 5: cited PDF p. 27
- Item 6: cited PDF p. 28
- Item 7: cited PDF p. 36
- Item 19: cited PDF p. 63
- Item 20: cited PDF p. 73
- Agreement term (Item 17): cited PDF p. 60
Page references for Papa Murphy's use the PDF viewer's digital page count, not printed page headers. Some viewers download the document instead of opening the referenced page.
If the state document viewer does not open, use Minnesota Commerce's public filing instructions to look up the filing by franchisor name and document date.
Document & verification changelog
- November 2, 2026: Source check completed against the recorded FDD.
- November 2, 2026: Initial cost profile published from the 2026 Franchise Disclosure Document (issued March 27, 2026).
- November 2, 2026: Independently checked against the March 27, 2026 Minnesota Clean FDD: cover, Items 1, 5, 6, 7, 11, 17, 19 and 20. Item 6 now lists all 37 rows (the draft had 9) and suppresses the annual fee model because of the local marketing minimum and per-transaction fees. The franchise fee now shows the $25,000 first-store fee. Added the opening time and deadline, Item 19 scope and an Item 19 percentage misprint, and Item 20 notes; removed an unsupported founding year. Rewrote the analysis.