Do you want to open a Quizno’s franchise store, but are you not sure if it’s worth it because of the turbulence the company is going through? Quizno’s has had several bad years financially, going from one of the most popular sub sandwich stores to a way smaller one. However, the company is still going strong and has a good loyal customer base with high brand recognition.
The company is still franchising with a focus on growth, and they provide exceptional support for franchisees.
In this article, we will go over Quizno’s, its franchise system, associated costs, support, and all other important things to show you whether it’s worth owning a Quizno’s.
About Quizno’s And Quizno’s History
Quiznos is an American fast-food franchised chain specializing in sub sandwiches. The company was founded in 1981 and started franchising right away.
They reached about 5,000 restaurants in 2013, with amazing growth. However, they filed for bankruptcy and dropped to around 350 stores about a decade later than their peak.
Now, they boast incredible brand recognition and brand loyalty even though they are far away from their peak point. Rego Restaurant Group owns Quiznos in 2023 with an experienced leadership team and serious franchise experience focusing on growth and profitability.
Franchise Model Table
| Cost Or Fees | Amount |
|---|---|
| Initial Investment | $458,100-$1.4 million |
| Franchise | YES |
| Franchising Since | 1981 |
| Franchise-Fee | $30,000 |
| Royalty-Fee | 5% |
| Liquidity | 30% of the initial investment |
| Estimated Outlets | 359 |
How Much Does It Cost To Open A Quiznos Franchise?
The total cost to open a Quizno’s varies between $458,100 and $1.4 million. It includes the $30,000 franchise fee and all other related startup costs such as payroll, lease, construction, inventory, and others.
This average number comes from the amounts the existing franchisees spent while opening their stores and Quizno’s suggestions.
Depending on several factors, such as the size and location of the store, you might end up spending below or above the average cost.
Franchise Requirements
Quiznos doesn’t have any strict requirements, both financially and professionally. You don’t need to have a business background in the industry or as a business manager. They teach you everything regarding the operation of a store.
On the financial side, there is no net worth requirement. You only need to possess 30% of the initial investment as liquid capital before opening your store.
Quizno’s Overall Sales
According to the latest Franchise Disclosure Document by Quizno’s, the company had a gross revenue of $9.5 million in 2022. In the same year, when we remove all the expenses and costs, the company didn’t have a net profit. It had a net loss of $533,642.
Profit & Revenue Of Quizno’s
Quiznos doesn’t share any information about individual stores’ financials, either franchise or company-owned. That’s why there is no official information.
However, we made an estimation from the total annual sales of the company. Based on that estimation, we can estimate that overall sales for a franchised store are probably around $264,620 annually.
So if we consider a profit margin of 15%, then we can calculate that a Quiznos franchise owner make $39,693 in annual profits on average.
| Financial Overview | Percentage of Revenue | Amount ($) |
|---|---|---|
| Individual Franchise Annual Revenue | 100% | 264620.00 |
| Rent | 10.63% | (28115.88) |
| Insurance | 5.31% | (14057.94) |
| Salaries | 21.25% | (56231.75) |
| Franchise Royalty Fees | 5.31% | (14057.94) |
| Utilities | 2.13% | (5623.18) |
| Cost of Goods Sold (COGS) | 26.56% | (70289.69) |
| Labor (Variable) | 13.81% | (36550.64) |
| Total (Expenses) | 85.00% | (224927.00) |
| Net Profit | 15.00% | 39693.00 |
Note: The displayed expenses are estimates based on industry averages and standard costs. Actual expenses may vary due to factors like location, business size, and market conditions. We recommend conducting detailed research or consulting with a financial advisor for a tailored financial analysis.
Failure Rate Of Quizno’s Franchise
Franchised Outlets:
| Year | Outlets at the Start of the Year | Outlets at the End of the Year | Net Change |
|---|---|---|---|
| 2019 | 304 | 278 | -26 |
| 2020 | 278 | 228 | -50 |
| 2021 | 228 | 201 | -27 |
For the Franchised outlets:
- In 2019, the failure rate was (26)/304×100≈8.55%
- In 2020, the failure rate was (50)/278×100≈17.99%
- In 2021, the failure rate was (27)/228×100≈11.84%
According to the above-mentioned data, the number of outlets at the end of the year are less than the number of outlets at the starting of the year which indicates failure.
We can see that the franchised outlets for Quiznos declined from 2019 to 2021, showing a failure rate between 8.55% and 11.84%.
Payback Period Of Quizno’s
The average investment of Quizno’s is $7,229,05 and the yearly profit is $39,693 . So, to find out how long it will take to earn back the initial investment:
Payback Period = Investment / Yearly Profit = $7,229,05 / $39,693 = 18.2 years
Based on these figures, it will take approximately 18-20 years to pay back the initial investment for Quizno’s. This time period could be longer or shorter depending on your sales, revenue, and profit figures.
Training and Support Of Quizno’s
Quiznos offers an initial training program that takes place in their headquarters to help you teach every aspect of the business model. This initial training takes several weeks, and it is an in-person training for up to two people, one franchisee and one designated manager.
They focus on teaching operational things such as preparing the menu, managing inventory, using POS systems, and many other things.
As part of their support system, they help both before and after the opening of the store. They have a dedicated real estate professional team to help you with site selection, lease negotiation, and other details.
After opening, they provide detailed marketing support from starting campaigns to getting in touch with your customers.
Terms of Agreement and Renewal
The initial term of the agreement with Quiznos is for ten years. At the end of the initial ten years, a renewal is possible if both sides want it and the franchisor approves the renewal.
This renewal is for another ten years for one additional term. There is a $5,000 renewal fee when you want to renew your agreement.
Obligations and Restrictions
The right that is given to a franchisee is specific to one location, and it can not be transferred to any location other than the one described without the franchisor’s written approval. Both the brand marks and systems are also specific to the franchised location and can’t be used anywhere else.
The franchisor might ask the franchisee to offer some special products from time to time, and the franchisee is obligated to offer these items. Apart from a special ask from the franchisor, the franchisee can’t offer any product or service that isn’t approved by the franchisor.
Opportunities abound for entrepreneurs in fast food franchising, including brands like Shake Shack Franchise, Fatburger Franchise, Steak ‘N Shake Franchise, Culver’s Franchise, and Slim Chickens Franchise.
Quizno’s Comparison
| Name | Franchise Fee | Royalty Fee | Initial Investment |
|---|---|---|---|
| Firehouse Subs | $20,000 | 6% | $200,132-$993,297 |
| Subway | $10,000-$15,000 | 12.5% | $182,550-$506,900 |
| Quiznos | $30,000 | 5% | $458,100-$1.4 million |
Conclusion
Even though the company took a major hit after filing for bankruptcy, they are still actively franchising with a strong franchise system in place. You don’t need a lot of cash to open Quiznos, and you are expected to make a decent amount of money.
There is also an extensive training and support system to make sure that entrepreneurs can operate their stores and succeed.
You don’t need any kind of experience to become a franchisee with them, which makes this opportunity even more lucrative.
If you want to open a Quizno’s, we can say that it might be a good idea, but it still comes with its risk as the company lost money in its latest financial report.
FAQs
Is Quizno's a franchise?
Yes, Quiznos is a franchise with established systems since 1981.
How much is the Quizno's franchise fee?
The Quizno’s franchise fee is $30,000. You pay this in a lump sum when you sign the agreement. There are no discount possibilities available, but depending on your situation, if you are opening more than one store or something special, you might discuss a potential discount.
Who owns Quizno's?
Quizno’s got acquired by California-based High Bluff Capital Partners in 2018. However, they did not changed their headquarters.
Who founded Quizno's?
Quizno’s was founded by Jimmy Lambatos, and his partner Todd Disner. It was founded in the year 1981.
How many locations does Quiznos has?
There are 176 Quizno’s in United States, 183 International locations which makes it a the total of 359 locations.
Where is Quizno's headquartered?
The headquarters of Quizno’s is located in Denver, Colorado, United States.
Sources
https://en.wikipedia.org/wiki/Quiznos
https://www.franchimp.com/?page=pdf&f=107346_2022.pdf
https://www.subway.com/en-GE/OwnAFranchise/FranchisingFAQs#a3