Subway Franchise FDD, Profits & Costs (2025)
Subway, founded in 1965 by Fred DeLuca and Dr. Peter Buck, started as “Pete’s Super Submarines” in Bridgeport, Connecticut. The brand gained popularity quickly and began franchising in 1974, leading to rapid expansion across the U.S. and internationally.
Headquartered in Milford, Connecticut, Subway now has over 37,000 locations in more than 100 countries. Subway is known for its customizable, freshly made sandwiches, wraps, salads, and bowls, emphasizing fresh ingredients and personalized meals.
The franchise offers a lower initial investment compared to many quick-service restaurants, making it accessible for new business owners.
Subway Franchise Initial Investment
How much does it cost to start a Subway franchise? It costs on average between $239,000 – $404,000 to start a Subway franchised restaurant.
This includes costs for construction, equipment, inventory, and initial operating expenses. The exact amount depends on various factors, including the type of restaurant you choose, the location, and whether the franchisee chooses to lease or purchase the property.
| Type of Expenditure | Amount (Low – Mid – High) |
|---|---|
| Initial Franchise Fee | $15,000 – $15,000 – $15,000 |
| Real Property | $2,000 – $5,000 – $12,000 |
| Leasehold Improvements | $75,000 – $150,000 – $200,000 |
| Equipment, Furniture and Décor | $106,785 – $157,532 – $208,845 |
| Optional Security System | $2,450 – $2,850 – $3,550 |
| Freight Charges | $8,000 – $10,400 – $14,000 |
| Outside Signage | $2,000 – $4,000 – $8,000 |
| Opening Inventory | $4,400 – $5,225 – $6,050 |
| Insurance | $1,000 – $3,000 – $6,000 |
| Supplies | $500 – $900 – $1,300 |
| Training Expenses | $2,500 – $3,500 – $4,500 |
| Legal and Accounting | $1,000 – $2,000 – $3,500 |
| Grand Opening Advertising | $2,000 – $3,250 – $4,000 |
| Miscellaneous Expenses | $4,000 – $6,000 – $8,000 |
| Additional Funds – three months | $12,000 – $26,000 – $42,000 |
| TOTAL (Traditional Location) | $238,625 – $394,657 – $536,745 |
| TOTAL (Non-Traditional Location) | $199,135 – $282,807 – $403,745 |
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Frequently Asked Questions
How many Subway locations are there?
As of the latest data, there are 19,502 Subway locations in the United States. California leads with the most locations, having over 2,000 stores, accounting for about 10% of the total Subway locations in the U.S.
What is the total investment required to open a Subway franchise?
The total investment required to open a Subway franchise ranges from $239,000 to $404,000 for the Single New Subway® Franchise.
What are the ongoing fees for a Subway franchise?
For a Subway franchise, the ongoing fees include an 8% royalty fee on gross sales, which is paid to Subway as part of the franchise agreement.
Additionally, franchisees contribute 4.5% of their gross sales to Subway’s advertising fund, which covers national and regional marketing efforts. These fees are part of the franchising costs and are essential for maintaining the brand and receiving corporate support.
What are the financial requirements to become a Subway franchisee?
To become a Subway franchisee, the financial requirements include having a minimum net worth of $80,000. Additionally, potential franchisees must have at least $30,000 in liquid capital.
These requirements ensure that the franchisee has the financial stability to cover the initial investment and operational costs associated with running a Subway location.
Who owns Subway?
Subway is owned by Doctor’s Associates Inc. (DAI), a private company founded by Fred DeLuca and Peter Buck in 1965.
The company remains under the ownership of the DeLuca and Buck families. Unlike many other fast-food chains, Subway does not have any public shareholders, and its ownership has stayed with the founding families since its inception.
Disclaimer
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