Are you looking for the Subway franchise but first, you want to check the profitability? If yes, then you are at the right place.
Here, we will examine how much does Subway franchise owner make and other facts that define the profitability of the Subway franchise? So, keep reading to learn more.
What Is Subway?
Subway is a fast-food restaurant franchise that primarily sells submarine sandwiches, wraps, salad, and beverages.
In 1965, Subway was founded by Fred DeLuca and financed by Peter Buck, and now it has become one of the fastest-growing restaurants and has more than 44,852 outlets worldwide.
They have a specialty in serving submarine sandwiches, and their products are typically not fried and are liberally garnished with fresh vegetables, which is one of the healthiest options of fast food.
It offers a franchise opportunity with minimal start-up cost for investors. Subway was also ranked third among the Top Global Franchise.
Read: Top 50 Franchise
How Much Does A Subway Franchise Owner Make?
According to data reports, Subway makes an average of 11 billion annual sales through its entire franchise system.
Statistically, the profit margin is only 7.5% of their annual sales, which is roughly up to $31,000, while the average sale of other restaurants is higher than Subway, and they also charge high recurring fees to its franchisees.
An individual Subway franchise owner makes approximately $422,000 in sales annually.
What Is Subway Best Known For?
Subway is known for its submarine sandwiches. Their menu includes a variety of fast food and beverages.
And the best part of Subway is that they serve low-fat menu options, which also have great taste.
Here are the most popular items at Subway following:
- Turkey Breast
- Oven Roasted Chicken
- Sweet Onion Chicken Teriyaki
- Veggie Delite
- Subway Club
- Italian B.M.T
- Black Forest Ham
Pros And Cons of Subway Franchise
Pros Of Subway Franchise
- Training available for new franchises
- A well-established brand
- Third-party financing option
- Site selection
- Provide regional and national advertising
- Lowest start-up cost
Cons Of Subway Franchise
- There are multiple additional fees
- Huge amount of competition internally
- Lack of Menu adaptability
- Still stick-on stale marketing methods
- Low profitability
Is The Subway Franchise Profitable?
Well, profitability is the most important aspect of every business or franchise. Nobody wants to invest their money where they can’t make a profit.
As per reports, the franchise is consistently profitable, but not every franchise has the potential to earn a high profit, which doesn’t necessarily mean the company has low sales, but the reason behind it is there are multiple additional fees charged by the franchisor.
And Subway is one of the franchises that charges multiple additional fees, which are borne by franchisees. These fees will decrease the profitability of the Subway franchise.
An individual franchise owner makes $422,000, and the profit margin of Subway is 7.5% of its sales, which is come to around $31,000 profit. And half of the profit goes as a fee charged by the franchisor.
Subway is the fastest-growing franchise. However, the profitability is not enough, and it’s not an ideal franchise that has the potential to earn high profits.
Subway has a low-profit margin and has even decreased over the past year. But their many good aspects also like they don’t demand any prior experience to own a franchise and provide training to the new franchises.
So, select wisely before investing in any franchise. Subway is not a bad option at all; we can consider subway if you are okay with less profitability; otherwise, there are many companies that offer franchise and has the high potential to earn huge profit.
Read all the perspectives; it will help you to make the right decision.
Frequently Asked Question
What is the initial investment required to open a Subway franchise?
Opening a Subway franchise requires an initial investment of $150,050 – $328,700
What is the average revenue of a Subway?
Subway makes an average of 11 billion in annual sales through its entire franchise system.
How many Subway franchises Outlets are there?
Subway has more than 44,852 outlets worldwide.
Amit Gupta is the founder of DrFranchises – a digital marketing agency that helps brands rank better on Google Maps through local SEO strategies. Amit has over 11 years of experience in digital marketing, SEO, email marketing, and social media marketing. He’s also the owner of multiple franchises and has helped countless brands achieve success online. When he’s not working, Amit can be found playing with his dog.