Penn Station East Coast Subs Franchise FDD, Profits & Costs (2025)
Penn Station East Coast Subs, founded in 1985 in Cincinnati, Ohio, is a fast-casual restaurant chain known for its grilled and cold Penn Station East Coast Subsubs, fresh-cut fries, and hand-squeezed lemonade. With over 300 locations across 15 states, the franchise offers a variety of sandwiches made with high-quality ingredients like USDA Choice Steak and hearth-baked bread.
The brand differentiates itself through an open-kitchen concept where customers can watch their food being freshly prepared, ensuring a premium dining experience with transparency and quality.
Franchising since 1987, Penn Station has grown steadily and earned recognition in industry rankings, including Entrepreneur’s Franchise 500, highlighting its commitment to excellence and customer satisfaction.
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Initial Investment
How much does it cost to start a Penn Station East Coast Subs franchise? It costs on average between 474,000 – $765,000 to start a Penn Station East Coast Subs franchised restaurant.
This includes expenses for store construction, equipment, initial inventory, and early operational costs. The total investment varies based on several factors, such as the restaurant’s size, location, and whether the franchisee opts to lease or purchase the property and necessary equipment.
| Type of Expenditure | Amount |
|---|---|
| Site Development Fee for Single-Unit Franchisees | $3,500 |
| Territory Fee for Multi-Unit Franchisees | Minimum of $7,000 |
| Initial Franchise Fee | $25,000 |
| Real Property | Not Specified |
| Store Construction | $262,000 to $381,000 |
| Equipment | $149,000 to $235,000 |
| Opening Inventory | $5,000 to $15,000 |
| Telephone Deposit | $25 to $150 |
| Insurance (per year) | $596 to $7,362 |
| Lease Security Deposit | $840 to $12,000 |
| Utility Deposit | $25 to $1,500 |
| Additional Funds for First 3 Months | $10,000 to $20,928 |
| Site Advertising for Opening | $0 to $10,000 |
| Design Fees for Construction | $15,000 to $20,000 |
| Legal Fees; Organizational Costs | $316 to $11,500 |
| Pre-Opening Interest Cost | $0 to $11,000 |
| Travel, Room and Board for Training | $2,391 to $9,500 |
| Permits/Licenses | $100 to $1,500 |
| TOTAL | $473,793 to $764,940 |
Average Revenue (AUV)
How much revenue can you make with a Penn Station East Coast Subs franchise? A Penn Station East Coast Subs franchised restaurant makes on average $771,000 in revenue (AUV) per year.
Here is the extract from the Franchise Disclosure Document:
This compares to $838,000 yearly revenue for similar sandwich franchises. Below are a few Penn Station East Coast Subs competitors as a comparison:
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Penn Station East Coast Subs Franchise Disclosure Document
Frequently Asked Questions
How many Penn Station East Coast Subs locations are there?
As of the latest data, Penn Station East Coast Subs operates 322 locations across 15 U.S. states.
What is the total investment required to open a Penn Station East Coast Subs franchise?
The total investment required to open a Penn Station East Coast Subs franchise ranges from $474,000 to $765,000.
What are the ongoing fees for a Penn Station East Coast Subs franchise?
The ongoing fees for a Penn Station East Coast Subs franchise include a royalty fee and a marketing/advertising fee. The royalty fee is set at 6% of the franchisee’s gross sales, which is typical for fast-casual restaurant franchises.
Additionally, franchisees are required to contribute 3% of their gross sales to a national marketing fund, which supports brand-wide advertising campaigns and promotional efforts aimed at driving customer awareness and business growth.
What are the financial requirements to become a Penn Station East Coast Subs franchisee?
To become a Penn Station East Coast Subs franchisee, the minimum net worth requirement is $500,000, and the minimum liquid capital requirement is $150,000. These financial prerequisites ensure that franchisees have the financial stability and resources necessary to support the initial investment and operate the business effectively.
How much can a Penn Station East Coast Subs franchise owner expect to earn?
The average gross sales for a Penn Station East Coast Subs franchise are approximately $0.77 million per location. Assuming a 15% operating profit margin, $0.77 million yearly revenue can result in $116,000 EBITDA annually.
Who owns Penn Station East Coast Subs?
Penn Station East Coast Subs is privately owned by the franchise’s founder, Craig Kava. He has been involved in the company’s operations since its inception and has played a significant role in its growth and development.
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