Multi-Unit Franchise Experts

FAQs on Investing in a Subway Franchise: What to Know before Retiring

Retirees eager to ride out their golden years as business owners increasingly find themselves contemplating the potential investment opportunities within franchising. With the Subway brand’s presence in more than 100 countries and its healthy reputation as one of the most recognizable fast-food chains on the planet, it’s understandable why some are interested in the perks associated with running a Subway franchise.

However, taking the plunge into franchise ownership is a complicated action, and it demands that aging business owners roll up their sleeves and go through the details to see if this investment vehicle is the right move. In this article, we’ll answer some of the most frequently asked questions about investing in a Subway franchise.

What Full-Time Commitment Does Subway Franchise Ownership Require?

Those venturing into their own Subway franchise should be prepared to handle the daily operations, including managing employees and interacting with customers as necessary. With many franchisees reaching retirement age, it is worth exploring what type of staff support is available.

Subway allows its franchisees to hire store managers or assistant store mangers if the owners wish to delegate certain tasks or be away from the store for a period of time. However, Subway is clear that the franchisee or designee must be present at least 50 percent of the time and they are ultimately responsible for the daily management of the store.

What Investment Needs To Be Made to Open a Subway Franchise?

The cost of opening a Subway franchise varies depending on the store’s size and location.

Subway’s franchise fee begins at $15,000 and the company requires franchisees to have between $80,000 to $310,000 of non-borrowed, liquid assets and also a net worth of not less than $100,000. The cost of the equipment is estimated to be from $51,250 to $286,000 while the establishment, renovation and start-up costs range from zero dollars to $83,500. It’s also important to note that the cost of required signage, which depends on the location and size of the store, can vary between $1,500 and $10,000.

What Are The Ongoing Support Services Provided By Subway?

Subway provides its franchisees comprehensive support services that include training, ongoing operational guidance, site selection assistance, marketing and advertising support, tailored programs, business and financial guidance, and more.

Subway franchisees will also benefit from Subway’s strong brand ubiquity, having the franchise partner’s name recognized around the world. Franchisees will also be provided with local, regional, and global marketing opportunities for further advertising leverage.

What Kind of Technical Knowledge Is Required To Manage A Subway Franchise?

When it comes to managing a Subway franchise, industry-specific knowledge is not a requirement; however, certain competencies are essential.

Subway owners need to demonstrate strong organizational and people skills as there will be plenty of day-to-day tasks that require the capacity to make good decisions while handling a variety of staff and customer needs. Additionally, they must be comfortable operating within the Subway systems, which require each store to follow the posted operational procedures and standards.

What Legal Agreements Are Needed To Open a Subway Franchise?

Before a Subway franchise is opened, a Franchise Disclosure Document (FDD) will be presented to prospective franchisees outlining the company’s legal information, existing and historic lawsuits, franchisee responsibilities, fees, and more.

Additionally, franchisees will be asked to agree to a Franchise Agreement, which governs the franchise-franchisor relationship. This agreement outlines the franchisees expected contributions, such as use of the Subway trademark, payment of ongoing fees, and requirements to adhere to the Subway Quality Standards and Procedures.

Concluding remarks

Retirees looking to transition into owning a business should understand the financial and operational risks associated with investing in a Subway franchise. As the largest player in the global sandwich-shop industry, Subway offers a franchise opportunity with a recognizable brand and an established platform of support services, yet caution is still advised.

By understanding the full-time commitment involved, the investment needs, the ongoing support available, the technical knowledge required, and the legal agreements involved, those interested in joining the Subway family can confidently make an informed decision and go forward confident in their endeavor.

Topics:

Subway Franchise,

Franchise Ownership,

Franchise Agreement

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