Are you interested in owning your own Subway franchise? If so, you’re not alone! The fast-food restaurant business is one of the most popular choices for people looking for an opportunity to enter the food business. But how much does a Subway franchise owner make?
Also, what are the costs associated with setting up a Subway franchise? And what are the requirements to open one? Additionally, how does the subway franchise stack against other fast-food chains’ franchises in terms of cost and profits? Read on to find out all of the details.
How Much Does a Subway Franchise Owner Make?
The most successful subway franchise owners make over $30,000 to $40,000 per year, which makes up around 7% of the annual sales.
Now we got these numbers by dividing the total annual sales of Subway in 2021 (9.4 billion in revenue) by the total number of franchises it had in 2021 (21,147 franchises). This gives us $444507 in annual average sales per franchise. If we get 7% of this, then it becomes a $31,000 profit per year.
But it’s not as easy as just sending a franchise application, open your Subway franchise and start raking greenbacks. It takes 1-2 years to build up a successful Subway business. So if you’re the entrepreneurial type with patience, this might be your business opportunity.
What Are the Opening Costs?
If you’re thinking of investing in a Subway franchise, it’s important to do your research first. This includes understanding the franchise cost, which can vary depending on location and store size.
The franchise cost can also be based on a number of other factors, such as the type of food served and the marketing and advertising campaign planned. The key factors include:
|Property Rent||$700 to $8000|
|Leasehold improvements||$4,000 – $38,000|
|Equipment||$1,000 – $21,000|
|Security systems||$400 – $2,600|
|Signage||$400 – $7,000|
|Opening Inventory||$900 – $3,500|
|Insurance||$150 – $1,500|
|Legal and Accounting||$150 – $3,500|
|Opening advertisement||$400 – $2,000|
Besides this, you will also have to pay a franchise fee of $15,000 ($7,500 if you’re from the army or are already a Subway franchisee), plus you will have to have some liquid capital of $40,000. You will also need to have at least a franchise net worth of $80,000. So, all in all, the total investment might range between $116,200 and $262,850.
Things Subway Will Take Care of When Opening Franchise
One of the main advantages of opening Subway franchises is that you are not firing shots in the dark. Moreover, they will help you start the franchise and offer advice/training on various aspects to ensure you can run the operations pretty well. Likewise, here are some things they can help you with:
- Field Operations
- Software sourcing
- Also, location selection and launch ceremony
- Advertising (Regional and national)
- Equipment leasing or sales
- Additionally, training programs for you and your staff
- Finance options if you’re short on initial capital
Compared to Chick-fil-A, Burger King, McDonald’s, KFC Franchise Profits & Costs
There’s no doubt that the fast food industry is booming. But with seemingly endless options to choose from, it can be hard to know which franchise to invest in. However, you can make an informed decision by understanding franchise profitability and costs.
|Restaurants||Initial Startup Costs||Average Annual Profits|
|Chick-fil-A||$219,055 to $2,912,697||$200,000+|
|Burger King||$316,100 to $2,660,600||$200,000+|
|McDonald’s||Up to $1,800,000||$150,000+|
|KFC||$1,442,600 to $2,771,550||$100,000+|
|Subway||$116,200 and $262,850||$30,000+|
When it comes to franchise profitability, Burger King is a good option. McDonald’s also offers moderate profits with greater flexibility through its global operations. However, if you’re looking for lower initial costs but less profit potential than other fast food chains, then Subway is the best.
So, if you’re planning to get into the Subway business, you can make a decent amount of money from it. However, if you want to grow your own store or franchise, it will all come down to how hardworking and diligent you are with product delivery.
When deciding to invest in an opening in Subway, be sure not to rush into anything too hastily. Make sure that you have researched everything about this business before jumping in for life!