Multi-Unit Franchise Experts

Subway Franchise

When it comes to starting a new career in the franchise industry, recent college graduates with limited business experience can find the process of investing in a successful franchise to be overwhelming. While the idea of being in business for yourself can be quite appealing, the reality of investing in a franchise is not a practical decision that should be taken lightly. With that in mind, here is a comprehensive guide to some of the Frequently Asked Questions (FAQs) on Subway franchise and how to get started.

What is Subway Franchise?

Subway is the world’s largest restaurant chain by number of locations, with approximately 44,000 restaurants in 112 countries. Subway’s parent company, Doctor Associates, Inc. (DAI), is a privately held US-based company that owns and franchises the original Subway restaurant brand. Subway franchises are designed to offer consumers fresh and healthy fast-food options. The restaurant chain is known for its signature “Sub” sandwiches, salads, and breakfast items, as well as its awarding franchising system.

How do You Become a Subway Franchisee?

Subway is widely recognized as one of the most successful international franchise systems and was recently ranked number one on Entrepreneur magazine’s list of top franchises. To become a Subway Franchisee, a prospective business owner must have a minimum net worth of $80,000 and liquid assets of at least $50,000 to invest in the business. Additionally, having experience in the restaurant industry is highly beneficial, but not required. All prospective franchisees must also complete an application and submit a Franchise Disclosure Document (FDD). Prospective franchisees are also required to complete a two-day training program and pass a background check and drug screening. Once approved, Subway pays your first restaurant rent and helps you negotiate your terms.

What are the Benefits of Owning a Subway Franchise?

Subway stands out among other franchise opportunities with its strong brand recognition, simplicity in operations, and low start-up costs. Franchisees have access to a wide range of support services, such as help with marketing, management software, personalized customer service and access to the Subway brand’s exclusive menu items. Subway offers established systems to help franchisees quickly capitalize on the business. This includes ready-made systems for operational efficiencies, including franchisees own website, customer loyalty program, and online ordering. Subway also offers an online university training program to ensure all franchisees are up-to-date on business operations. In addition, Subway’s parent company, DAI, also works closely with franchisees to ensure their success.

What are the Costs of Starting a Subway Franchise?

The initial franchise fee for Subway is $15,000. The total investment required to set up a Subway franchise ranges from $139,200-$322,400, with an average total investment of $225,500. This includes the initial franchise fee, real estate and an operating capital of $7,500-$15,000. Subway also offers financing through their preferred lender network, which may help qualified franchisees to purchase a franchise.

How Much Profit Can You Make From a Subway Franchise?

The profitability of a Subway franchise varies from one location to another, based on factors such as location, competition, and menu items offered. The average Subway restaurant generates annual gross sales of $425,000. After subtracting royalties (6-8%) and other expenses, the net income of a Subway franchise averages roughly 15-25% of sales.

Final Thoughts

Subway is an incredibly popular franchise system with an established record of success. Investing in a Subway franchise offers low start-up costs and a wealth of support services. Although it can take some time to launch a successful Subway business, once established, a Subway franchise can become a great source of long-term income and wealth for the owner.


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