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Whats the average income of a subway restaurant owner?
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You actually do not need, should not need 400k to cover negative cash flow for one year; if you are projecting that bleed rate, do not buy that store. If you are not sure of the projected cash flow based on Sales and Rent, contact me , as others have done, to find a reliable projection of actual cash flow and buy the store at a reasonable price. Most people get rich on Subway with 2 or 3 stores or more, not on one store. For new prospective owners-you can usually buy only one store at a time.
mrfranchiseman.com, Subway specialist
949-253-4610
I am looking at starting a new venture and I have been through this entire post. I am from India and am planning to own a Subway franchise.I have my own location which according to me is a traditional location as of now, but has a lot of scope. Initial expenditure including franchise fee is 90000 $ and the rest of maths u know. Before reading this post i had in mind a good profit margins of around 30-40 % but now i am sceptical of opening a Subway with so much expenditure , though the location is self owned but can fetch me a decent return later. What do think?? I should go ahead and open a subway franchisee, keeping in mind the manpower is cheaper in India compared to US and I mite not have to work as many hours as you have mentioned. Also being orthodox I am assuming a weekly sale of 1700 $ initially to start with.
Please advice.
Thanks
Subway discourages such postings from brokers
Not all stores that are for sale are identified as such for internal reasons. The ones that are on the Subway website are of poor performance and you take your chances.
I have developed methodology to access some of these hidden gems that are out there, and have some success at it, but it is time consuming, requires discipline and an ability to talk to owners. As a previous owner of 9 Subway stores and as a former Development Agent, I know how to achieve this as long as you are a qualified and approved buyer.
Fayaz Karim, mrfranchiseman
this is after they pay the royalty fee, right?
Lets say the average profit margin is 15%, if you still need to pay the 12,5% (royalty+advertising) , you are having around 2,5% net profit, which is not a good business investment
can someone clear this for me?
thanks,
Talk about Saturation from the franchisee perspective!......big debate going on.
It is time for some Subway owners to sell and cash out some of their portfolio. I am already seeing some movement in the market, but they are usually the least performing in their portfolio. To be expected.
Great time for first time buyers looking for a decent job and getting ready to pounce on new opportunities as they come along. They will all sell someday.....
Over the years I also wandered what people buy or do if they cannot buy a Subway or other franchise, and found an amazing solution. And it is free of all the franchise headaches I have heard over the past 20 years, yet it operates like a franchise with no limits. Subway is matured and getting to be a tired brand , or so I am told. They are even doing $4 subs in a few areas........
fayaz@mrfranchiseman.com
I own 3 franchises in the United States and my break down is this:
Food-33% (lowest store 30% highest store 33%)
Labor-22% (lowest store 19% highest store 22%)
Rent-9% (lowest store 3% highest store 9%)
Subway-12.5%
Utilities/Misc-8.5%
Profit-15% (lowest store 15% highest store 22%)
I highly suggest keeping your food/labor 55% or less and rent less than 10% to maximize profits. Mrfranchiseman and SubwayOwner have the most accurate posts on this site. I would also suggest financing your equipment instead of leasing. The average subway lease comes out to +20% interest where as a traditional loan would be in the 5-8% range. Hope this helps!
I found a post from you regarding your interest to get into the franchise business. I have a similar interest to step back and venture out of the corp world to become a franchisee.
Did you get into the franchise world? Did you try Subway?