How much does it cost to start a Subway franchise?
Subway is one of the most ubiquitous and successful global fast-food chains. Those looking to franchise a Subway store can expect to shell out around $200,000 in startup costs plus a $15,000 initial licensing fee. Subway's franchise fees tend to be lower compared to its competitors. Subway has a long history in the fast food business.
What are the costs involved with opening a Subway franchise?
Subway is one of the cheapest major fast-food restaurants to franchise. Subway's fee for becoming a franchisee is $15,000, and startup costs, which include construction and equipment leasing expenses, range from $116,000 to $263,000, according to the company.Jul 11, 2019 Originally Answered: How much does it cost to open a Subway franchise?
Can you make money with a Subway franchise?
Well, becoming a Subway owner can bring the exact opposite. If you are planning to own a single-unit of a Subway franchise, unless you spend your time running the business, you will make very little money out of it. So you will need to be involved, and that means actively managing a business operation that is open 7 days a week, for long hours…not very appealing…
What is the average income of a Subway franchise?
There was a survey of several hundred owners performed by a Subway owners association that showed the average store profit is in the $28,000 per year range. Any loans taken to purchase the store (ave. store cost to build is in the $200K range) needs to be subtracted from this number.
Is Subway a franchise?
SUBWAY® has an Independent Purchasing Cooperative (IPC). IPC is a franchisee-owned and operated purchasing cooperative that negotiates the lowest costs for goods and services while maintaining quality, standards and ensuring the best value for SUBWAY® franchisees.
Is Subway a chain?
Subway, restaurant chain specializing in submarine sandwiches. In 2002 it became the largest fast-food chain in the United States, measured by number of outlets. The company operates in more than 100 countries.
What type of franchise is Subway?
The business has two types of franchises: traditional and non-traditional. Traditional locations are full-service restaurants where the only purpose is the operation of a Subway restaurant with a full menu. On the other hand. non-traditional locations are also full-service, but are housed with another business.
Is Subway a franchisee or franchisor?
With an 8% royalty fee, we can calculate the estimated average gross sales for the 22,201 franchised outlets that were open in 2020. Subway franchise is one of the most valuable privately held franchises in the world.
Who owns Subway now?
Doctor's Associates, Inc.Subway / Parent organization
What is the largest fast-food chain?
McDonald's(MCD) McDonald's is the world's largest fast-food restaurant chain and one of the best-known brand names. The company has more than 39,000 locations in about 100 countries.
Is McDonald's franchised?
McDonald's has been a franchising company since 1955 and has relied on its franchisees to play a major role in the system's success. Currently, about 95% of all U.S. restaurants are franchised to independent franchisees and about 5% are company-owned.
Is Starbucks a franchise?
Starbucks Coffee doesn't franchise. Even though franchising is a classic, successful growth strategy for myriad beloved, familiar brands, Starbucks does not grant franchises. It's not because franchising isn't a time-tested model for growth. Many companies offer franchises.
Is KFC a franchise?
KFC Franchise is owned by Yum! brands, global franchisor whose 3 restaurant brands, Pizza Hut, Taco Bell and KFC, are amongst the largest and most well-known franchises in the world. They are leaders in their respective industries - Pizza, Mexican and chicken. Yum!
How long does a Subway franchise last?
Term of Agreement and Renewal: The length of the franchise term is 20 years, with the exception of satellite restaurants and the school lunch program.
Is Dunkin Donuts a franchise?
For savvy investors eager to establish themselves with a brand known around the world, Dunkin' is a franchise opportunity that can't be beat.
How much is McDonald's franchise?
McDonald's franchisee applicants must have a minimum of $500,000 available in liquid assets and pay a $45,000 franchise fee. Those looking to launch a new McDonald's franchise can expect to shell out between $1,314,500 and $2,306,500. Existing franchise prices can cost upwards of $1 million or more.
What is America's largest sandwich chain?
SubwayThe QSR 50 Sandwich Segmentcategory rankqsr 50 rankcompany13Subway*211Panera Bread*316Arby's423Jimmy John's4 more rows
Is Subway losing popularity?
More specifically, Subway's market share fell from 58% to 53% over the past two years. In other words, it's doing okay, but losing customers to its competitors. And currently, its biggest rival seems to be Jersey Mike's Subs.
Is Subway growing or declining?
Sales at Subway's US locations have been falling in recent years, according to the research firm Technomic. System-wide sales at Subway's US locations were $12.3 billion in 2013, which was its best year of the past 15 years. in 2021, sales slumped to $9.4 billion, according to Technomic's analysis.
Is Subway owned by McDonald's?
The company itself does not own any Subway restaurants. McDonald's owns about 20% of its restaurants, with the remaining 80% owned and operated by independent franchisees.
Background
Subway is the world's largest submarine sandwich chain. The company has more than 40,000 locations globally. Its becoming ta leading choice for people seeking quick, nutritious meal options that the whole family can enjoy. From the beginning, Fred DeLuca has had a clear vision for the future of the Subway brand.
Support and Training Offered By Subway
On-The-Job Training 20 hours Classroom Training 80 hours Additional Training Training available in Australia, China, Germany, India, Montreal, Canada & Miami Subway also offers in-house and third-party finance options
2022 Franchise Requirements Needed to Own a Subway Franchise
Veteran Incentives: A veteran's franchise fee waived if opening on a military or government funded location. Additionally, they'll receive 50% off the franchise fee if opening a non government location with government financing
Franchises Similar to Subway
The International Franchise Professionals Group (IFPG) is an internationally recognized membership-based franchise organization. IFPG Franchise Consultants guide aspiring business owners through the process of identifying and investing in franchise businesses. The IFPG represents more than 550 franchises.
When did the subway start?
Subway began in August 1965 as a partnership between Fred DeLuca, a 17-year-old who needed money for college, and Peter Buck, a family friend with a Ph.D. in physics. Buck loaned DeLuca $1,000 to open a takeout restaurant in Bridgeport, Connecticut.
What is subway sandwich?
Subway, restaurant chain specializing in submarine sandwiches. In 2002 it became the largest fast-food chain in the United States, measured by number of outlets. The company operates in more than 100 countries.
How many subways were there in the 21st century?
In the second decade of the 21st century, there were more than 40,000 Subway restaurants worldwide. By then, all stores were owned by franchisees. DeLuca died in September 2015, after which day-to-day control of the company passed to his sister, Suzanne Greco. The company remained privately held.
What is a restaurant?
restaurant, establishment where refreshments or meals may be procured by the public. The public dining room that ultimately came to be known as the restaurant originated in France, and the French have continued to make major contributions to the restaurant’s development.…
Why is Pete's Super Submarines called Pete's Super Submarines?
The restaurant was called “Pete’s Super Submarines” because submarine sandwiches were the menu specialty. In 1966 DeLuca and Buck incorporated a company called Doctor’s Associates. DeLuca later identified the doctor as Buck and the associate as himself.
How much does it cost to open a subway?
Initial costs for a store site include its real estate and construction expenses. For a Subway business, it is estimated the total cost for the initial restaurant site ranges from $150,050 to $342,400, much lower than other competing fast food franchises.
Why do entrepreneurs want to own a franchise?
With franchise ownership, franchisee entrepreneurs gain the benefit of licensing an established business's procedures and processes from the franchisor. These licensing benefits give the business owner numerous advantages, including an association with an established business and the benefits of an already established branding strategy.
How much does it cost to franchise a McDonald's?
An initial startup licensing fee of $15,000 is required to begin the business, compared with a $40,000 to $90,000 licensing fee for Dunkin' ( DNKN) or the $45,000 fee that Mcdonald's ( MCD) charges. Annually, royalty fees are also required. Subway royalty fees are 8% of annual gross sales, which are higher than the 5% and 4% that Dunkin' and Mcdonald's charge, respectively. Additionally, the franchisee is required to pay an ad fund fee that is 4.5% of total gross sales.
What are the benefits of franchise?
One of the greatest benefits of a franchised business is the ability to gain use of the company’s operational procedures, trademark rights, and branding. With these licensed business advantages, franchisees can primarily rely on the established marketing of the franchised business for its sales.
Is subway the largest fast food company?
In fact, Subway is the largest fast food company in the world in terms of store count. It is one of the most popular businesses to franchise and is also known to have among the lowest franchising costs. For 2020, it is ranked #107 on Entrepreneur Magazine's " Franchise 500 Ranking .".
Is subway a licensor?
These licensing benefits give the business owner numerous advantages, including an association with an established business and the benefits of an already established branding strategy. In the fast food industry, Subway is an extremely well-established licensor of its sandwich stores. In fact, Subway is the largest fast food company in ...
Is subway a privately owned company?
Subway has a long history in the fast food business. It is a privately owned company that opened its first restaurant in Connecticut by founder Fred DeLuca in 1965 under the name "Peter's Super Submarines.". Its deep roots have allowed the company to build a strong strategic brand around its sandwiches and ...
How much did the subway franchise make in 2012?
In 2012, prior to Subway’s decline, the average Subway franchise generated $482,000 in revenue. By 2016, that had dropped to $422,500. These numbers have to do with the fact that more Subways are opening but are not earning as much thanks to the increased competition.
How much does it cost to license a subway franchise?
In comparison, Subway franchises are much more affordable to the average small business owners in the United States. Their licensing fee is at $15,000, much cheaper than other popular food brands like McDonald’s.
How much does subway royalty cost?
Subway’s royalty fees are at 8%, which is twice of what McDonald’s charges its franchisees at 4%. It’s a small number, but for small business owners it can mean significant thousands of dollars that could be the difference between profitability and loss.
How many subways are there in 2020?
As of 2020, there are over 41,500 Subways worldwide, all of them independently owned.
Why is the subway so fast growing?
Arguably, the reason for Subway’s fast growth and appeal to potential franchise owners is its low-cost high-return model.
How much does it cost to open a subway?
The total cost of opening a Subway is estimated at $150,000 to $300,000. In terms of franchising, that’s the cost of a less popular restaurant franchise. Yet, Subway’s popularity rivals the big names of the fast-food industry yet keeps its franchising costs low.
What is the subway's open kitchen?
Unlike other fast food restaurants like McDonald’s, you can see the fresh ingredients put into your sandwich and see to it that the Subway staff are making it according to your directions . This has allowed Subway to gain the “healthy” fast food advantage in an industry where health is a hard-to-reach advantage.
What sub chains are there in the subway?
Quiznos was once Subway's main competition, but tons of sub chains, like Jimmy John's, Firehouse, Potbelly, and Jersey Mike's, and fast-casual chains like Panera, were offering seemingly fresher and healthier options.
How many subways are there in the world?
Subway has the most locations of any fast-food chain on the planet, with more than 42,000 restaurants in over 100 countries.
How many subways will be open in 2020?
Narrator: By the end of 2020, over 10,000 locations will have this new restaurant design. But Subway says food is its next priority, and it's backing it up with an $80 million investment in updated menu items. Subway's partnered with the media company Tastemade to develop hundreds of new menu ideas, like the Green Goddess Tuna Melt and the Southern Style French Dip. In 2018, the chain introduced its cheesy garlic bread, its most successful promotion in the last five years. And in 2019, a line of ciabatta sandwiches and Halo Top milkshakes hit stores.
Why didn't subway stop?
Narrator: And Subway corporate wasn't stopping it, because the company benefited from a high number of locations. More locations meant more franchising fees and high royalties to Subway corporate, which diminished the effect of falling sales from a single location.
How many subway stores were closed in 2016?
Narrator: All of these things created the perfect storm for Subway. And soon, locations started to close. In 2016, Subway closed 359 stores in the US. It was the first year the chain closed more locations than it opened. In 2017, that number was over 800, and by the end of 2018, over 1,000 locations had closed.
How much money did the subway make in 2012?
In 2012, each Subway franchise generated an average of $482,000 a year. Four years later, that number had slipped to $422,000 a year. For comparison, the average annual revenue of a McDonald's franchise in 2016 was $2.6 million. And to make matters worse, Subway would lose the face of its company.
How much does it cost to open a subway?
Narrator: Not only were Subway franchises successful, they were, and still are, one of the cheapest chains to franchise. It costs between $116,000 and $263,000 to open a Subway franchise. Compare that to opening a McDonald's, which costs up to $2.2 million.
