Firehouse Subs Franchise Costs $647K (+ 2023 Costs & Profits)

A sandwich franchise icon, the Firehouse Subs franchise has over 1,200 restaurants across the US and North America. If you’ve ever considered starting a Firehouse Subs franchise, you may want to know how much money you can make with this franchise.

The good news is that Firehouse Subs does seem like a great investment. Indeed, with annual sales of $891,000 per year but with a (mere) $647,000 investment upfront, your payback period is rather short.

Want to know more? In this article we’re looking at Firehouse Subs and the numbers from its latest Franchise Disclosure Document.

We will see how much you can realistically make with this business, how profitable it really is, and whether you should invest in a Firehouse Subs franchise. Let’s dive in!

Key stats

Franchise fee	$20,000
Royalty fee	6.00%
Marketing fee	5.00%
Investment (mid-point)	$796,000
Average sales	$943,000
Sales to investment ratio	39.0x
Payback period	[franchise_value_investment_payback]
Minimum net worth	$350,000
Minimum liquid capital	$100,000

About Firehouse Subs

Firehouse Subs is a leading fast-casual food chain restaurant with over 1,200 stores in the USA, Puerto Rico, and Canada.

The chain was founded in 1994 in Jacksonville, Florida, by firefighter brothers Chris and Robin Sorensen.

It serves hot specialty subs, salads, and other seasonal items. The subs are made with meats and cheeses and served on toasted sub rolls “Fully Involved” with vegetables and condiments.

Firehouse Subs began franchising in 1995 and is owned by Restaurant Brands International (RBI).

Firehouse Subs franchise: pros and cons

Pros

• Extensive training: The brand offers franchisees comprehensive training programs and operating systems to help them run a successful business. Its team of experts trains franchisees on site selection, restaurant design and construction, operations, and restaurant management.
• Aggressive marketing: Best known for its famous slogan, “Our way beats their way,” Firehouse Subs has a compelling marketing strategy that helps franchisees promote their local stores to a wide range of demographics.
• Operational excellence: The brand has a varied, innovative, and evolving menu that caters to changing market trends and customer preferences. In addition, it has excellent customer service and utilizes a specific menu for each day, appealing to all types of customers.
• Unique brand: Firehouse Subs is a unique brand that steams its meats and cheese to preserve its flavors. It also features authentic firefighting décor in its restaurants, which sets it apart from the competition.
• Growth opportunities: The brand has more than 1,200 stores in the US and is still growing. With upcoming international opportunities, such as Canada, that are well planned to ensure franchisee success, franchisees are guaranteed growth potential.
• Territory protection: The franchisor grants the franchisees the right to carry out business within a specific trade area approved and protected by it. It, therefore, does not grant other franchises or operate competitive businesses within the trade area.
• Community involvement: The chain was founded by firefighters, and therefore it is very conscious of firefighters and emergency medical services (EMS) in the local communities. It supports local firefighters and funds first responders, making it attractive to customers.

Cons

• No financing: The franchisor or its affiliates do not offer direct or indirect financing to franchisees. Besides, it doesn’t guarantee any notes, obligations, or leases on behalf of its franchisees.
• Competition: Despite being a fast-growing brand in the sandwich industry, Firehouse faces a lot of competition from well-established players such as Subway and Jimmy John’s.
• No global presence: The brand has a minimal global presence. Therefore, a Firehouse Subs franchise may not be a viable investment in some locations.

How much does a Firehouse Subs franchise cost?

On average, you would invest around $647,000 to open a Firehouse Subs franchise restaurant. This amount includes an initial franchise fee of $20,000.

This investment amount is an average, indeed, it will vary depending on your choice of restaurant type. As you can see, you would need more investment for a non-traditional restaurant than a traditional one.

You will pay this amount to cover the startup costs of your restaurant business. Here’s an example breakdown of your estimated initial investment:

Type of Expenditure	Low	High
Initial franchise fee	$20,000	$20,000
Formation costs	$163,082	$828,831
Advertising	$5,000	$15,000
Operating expenses	$12,050	$129,466
Total	$200,132	$993,297

How much can you make with a Firehouse Subs franchise?

On average, a Firehouse Subs franchise makes $891,000 in sales annually. The number is the annual median sales of 1,096 franchised restaurants (traditional and non-traditional) operating in 2021.

On average, non-traditional restaurants generate more revenue than traditional restaurants.

Also, most of non-traditional restaurants’ sales are in the higher range compared to traditional restaurants (over $884,000 sales per year or $17,000 per week).

Source: Franchise Disclosure Document 2023

How profitable is a Firehouse Subs franchise?

On average, a Firehouse Subs franchise makes $71,000 in profits per year (9% EBITDA margin).

Profit and loss	Amount	% Sales
Sales	$891,042	100%
COGS	$(285,133)	32%
Gross Profit	$605,909	68%
Labor	$(249,492)	28%
Marketing and royalty costs	$(98,015)	11%
Occupancy	$(80,194)	9%
Other OpEx	$(106,925)	12%
EBITDA	$71,283	8%

Is a Firehouse Subs franchise a good investment?

When comparing the $647,000 upfront investment to profits, we estimate that Firehouse Subs franchises have a payback period of 7 years on average, which is good.

This means that, on average, you would need to wait 7 years on average to reimburse your initial investment.

From our perspective, this is a good investment and in line with similar restaurant franchises.

Disclaimer

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