Subway Franchise Cost and How to Get Started

If you are thinking of starting a business and becoming your own boss, starting a Subway restaurant is a great opportunity for you.

Subway is one of the biggest names in the food industry and with its global presence, it has become a household name that consumers trust and respect.

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With millions of customers eating at more than 44,758 restaurants in over 112 countries worldwide, Subway is undoubtedly one of the most successful food franchises on earth.

In fact, statistics show that it serves 2,800 sandwiches and salads every 60 seconds!

Operating a Subway franchise is a great opportunity for anyone looking to start their own business.

The company has a proven track record and the products are highly sought after by consumers.


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Subway Franchise Overview

The SUBWAY® franchise system’s success is built on the proven strength of our brand, innovative products, and a commitment to helping every one of our franchisees succeed.

They offer a turnkey business opportunity that includes everything you need to get started: a proven business model and comprehensive training, ongoing support, advertising programs, and more.

Their world-class training program provides you with all the tools and information you need to open your sandwich shop.

As part of the program, you’ll receive extensive classroom instruction, hands-on training, and field experience at a SUBWAY® restaurant.

And once your restaurant is up and running, they continue to offer support through an extensive network of field consultants, as well as continuing education programs and other resources.

SUBWAY® franchisees are also supported by national advertising campaigns, which are designed to build awareness for the SUBWAY® brand and help drive traffic into their locations.


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Benefits of Owning a Subway Franchise

A Subway franchise is a great opportunity for anybody that is looking to become an entrepreneur and start their own business.

Even though the initial investment can be quite high, the return on revenue and profit can be even higher.

The cost to start a Subway franchise will vary depending on your location and how big your restaurant is.

Franchising is an effective way of getting into business, and there are a number of benefits to choosing this route over going it alone.

For example, if you opt for a franchise business, you will have access to tried and tested procedures.

You will also be able to take advantage of guidance and support from the franchisor, as well as benefit from any training and marketing that may be included in the package.

If you’re considering joining this successful franchise family, here are some of the incentives you can expect:

You get to be your own boss

Although you’ll have to follow many rules set forth by the company, owning your own business gives you the freedom to make decisions based on what you think is best for your restaurant.

You can choose your own employees and decide how long they work each day and how many hours they work each week.

If you’re unhappy about how much money you’re making, you can increase your prices as long as you don’t go over the price cap set by the company.

You can also decrease prices to attract more customers.

You have a flexible schedule

Subway franchise owners are not restricted to operating their stores during typical working hours.

You will be able to set your own hours and decide if you want to open on holidays — although most locations do open on major holidays like Thanksgiving and Christmas, even if it’s for a limited time period.

This makes it easier for work-at-home parents or retirees who want to make extra money without having to work every day from 9 to 5.

Training and Ongoing Support

When you become a Subway franchisee, you get the benefit of the brand’s decades of experience and expertise.

A large part of that is a series of training programs designed to ensure new franchisees feel comfortable owning and operating their stores.

New franchisees must complete a five-week training program at Subway University in Connecticut.

The program covers every aspect of operating a Subway franchise location, from managing employees to understanding the brand’s supply chain.

In addition, each new franchisee is paired with an experienced mentor from within the system who can help guide them through their first year as a business owner.

New store owners also get access to one-on-one assistance from the company’s team of consultants.

They can provide support on everything from marketing and advertising to human resources and supply chain management.

You get national advertising support

One of the major benefits of owning a Subway franchise is that you get national advertising support for your store.

The national marketing team at Subway creates advertisements to promote the brand on television, radio, print, and even digital media.

As part of the company, you are entitled to all of these benefits, which can help drive more customers into your store.

Low staffing Requirements

Subway was founded on the idea of giving customers healthier food at affordable prices, and this simple concept is what keeps the brand so popular among consumers.

Its focus on healthier food means a menu with fewer items than other fast-food chains, which means less staff for the same level of sales.

This has a major impact on staffing costs and makes it easier for franchise owners to make a profit in their restaurants.

Lower Costs Than Other Fast Food Restaurants

As far as startup costs go, owning a Subway restaurant is one of the cheapest options out there.

A Subway franchise has an initial start-up fee of just $15,000 — much lower than many other franchising opportunities.

This means you don’t have to take out a loan or secure investors to get started with your business.

All you have to do is find the right location and pay the upfront fee to get started.

No previous food service experience is required

One of the biggest advantages of owning a Subway franchise is that the company doesn’t require any previous food service experience for its prospective operators.

As long as you’re willing and able to follow the guidelines set forth by the franchise, you can open your own Subway sandwich shop.

The company provides extensive training for new owners so that they learn all about preparing food safely and running a business efficiently.

Subway offers a lot of support to new franchisees, including assistance with store layout and design, buying equipment, training employees, and handling paperwork.

Subway has a Strong Brand Identity

Subway has a strong brand identity is the ideal franchising opportunity for those who want to start a small business but don’t have the means to build an entirely new brand from the ground up.

The company’s iconic logo and “Eat Fresh” tagline are instantly recognizable by millions of customers around the world, which means that even if you’re new to franchising and business ownership, your customers will already be familiar with the products you sell.

Subway’s high name recognition is a major asset for franchisees, as it can make it easier to attract and retain customers.

Additionally, because Subway is so well-known around the world, franchisees benefit from having a global support network of fellow franchisees they can turn to when they need advice or assistance.


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How Much Does it Cost to Open a Subway Restaurant

Opening your own Subway restaurant will require you to go through the process of signing a contract, submitting an application, and getting approval. This process can take anywhere from 6 months to over a year.

If you are thinking of becoming a Subway owner, then you need to meet certain requirements that have been set by the company.

They have strict guidelines that every Subway franchisee has to adhere to in order to make sure that their Subway restaurants stay successful.

How much does it cost to open a Subway restaurant? In order to open a Subway sandwich shop, the total investment ranges from $105,800 to $416,000.

The initial franchise fee is $15,000 and the total liquid cash available should be at least $30,000. The net worth required is $80,000.

In addition to this, you will have to pay ongoing royalty fees of 8% on a weekly basis and marketing fees that amount to 4.5% of your gross sales.

The total investment for opening a Subway sandwich store varies depending on the real estate costs and the population density of the area where the restaurant will be located.

In the United States, there are more than 35,000 Subway restaurants spread across all 50 states and in 112 countries around the world.

Subway Franchise Estimated Initial Investment Table

Name of Fee Low High
Initial Franchise Fee $15,000 $15,000
Real Property $2,000 $12,000
Leasehold Improvements $40,900 $200,000
Equipment, Furniture, and Décor $75,000 $150,000
Optional Security System (not including monitoring) $2,450 $3,550
Freight Charges (varies by location) $3,000 $14,000
Outside Signage $1,600 $8,000
Opening Inventory $4,400 $6,050
Insurance $1,200 $5,000
Supplies $500 $1,300
Training Expenses (including travel & lodging) $2,500 $4,500
Legal and Accounting $1,000 $3,500
Opening Advertising $2,000 $4,000
Miscellaneous Expenses (business license, utility deposits & small equipment) $4,000 $8,000
Additional Funds – three months $12,000 $42,000

Table Source: franchisedirect.com

How to Open a Subway Restaurant

Request a Subway franchise kit through the website

Before starting your business, you must get a franchise kit from Subway.

The kit includes information about operating a franchise, what costs are involved, and what Subway expects from you as a franchise owner.

Also, the kit will provide you with information on how to open your own Subway restaurant, as well as information on different locations and what they cost.

Secure financing

The first step of becoming a Subway franchisee is securing financing for your business.

The investment required to open a Subway franchise varies depending on real estate costs, construction needs, and location.

Generally, individuals interested in opening a Subway franchise must have around $80,000 in liquid capital and be able to afford a total investment of up to $416,000.

This includes the initial fee which ranges from $15,000 to $30,000.

Individuals who are not able to meet this financial requirement can still apply for financing through the company itself or third-party lenders.

Submit a franchise application

Once you decide to move forward, visit Subway’s website and fill out an online application.

You can also download an application from their website if you prefer written applications to web forms.

A representative from subway will contact you after receiving your application to discuss the next steps.

Before you start filling out the online form, be sure to review all of the information on Subway’s website regarding owning a franchise.

Pay special attention to the list of requirements that all potential franchisees must meet in order to operate a store and read through the FAQ page carefully.

If after reading through this information you decide that owning a Subway restaurant is right for you, fill out the application form.

Finalize the franchise agreement

Once you’re approved, you’ll have to finalize the franchise agreement with Subway.

This is the most important step in the process because it defines the relationship between Subway and its franchisees.

This agreement includes topics like the length of the franchise, what’s required and what’s prohibited, and termination rights for both sides.

Attend training

You need to attend training classes at Subway University through their official website or through an approved training provider.

This program is called the “Franchisee Training Program”.

It provides you with basic information about Subway’s site selection, customer service, marketing strategies, products, procedures, and administration.

The course also helps you to develop the skills necessary for operating a restaurant.

The regular “Subway University” program takes two weeks to complete.

The advanced “Subway University Advanced Management Program” takes four weeks to complete.

Find a location

Before you can even begin thinking about the other steps necessary to open your Subway franchise, you must find a retail space in which to operate.

Your location will be instrumental in the success of your franchise, and it’s important to consider several factors when selecting a spot.

First and foremost, you should look for a place that receives high foot traffic from people who are likely to eat at Subway.

Also, your location should be visible, with easy access for pedestrians and drivers alike.

If you’re opening a restaurant in a shopping mall or plaza, make sure your unit is near the main entrance and has enough parking for all potential customers.

Apply for permits and licenses

Depending on where you are located and the type of services offered at your restaurant, you may need several different licenses and permits before you can open your doors.

In many places, restaurants must have health department permits in addition to regular business licenses.

Organize the store layout

The most important thing when opening a Subway Sub is to have a detailed plan of how you will organize your store.

This includes the layout, inventory, and operations. You need to make sure that the space that you are working with is able to accommodate all of these things.

The store should also be in an easily accessible place for your customers.

In the beginning, you must draft up the floor plan of your store and have it approved by the company’s franchising department.

This is so that they know that you are able to adhere to their standards and specifications.

Next, you will need to purchase all of the equipment needed for your store from Subway directly.

This will include things like ovens, refrigerators, freezers, sandwich boards, and more.

You can choose whether or not to employ an outside architect or hire someone internally who will work on designing your store’s layout.

However, if you plan on doing this yourself then there are some things that you must keep in mind before getting started such as hiring contractors or buying materials yourself.

Hire and train employees

The amount of staff you need depends on how many hours you’ll be open and how many customers you expect to serve.

You’ll need shift leaders to oversee other employees during their shifts.

Subway franchises have an open kitchen format so customers can watch their sandwiches being made.

Make sure that your employees understand the importance of maintaining cleanliness in the work area as well as customer service skills.

Plan a grand opening

Grand openings are the perfect time to introduce your Subway franchise to the community and encourage people to try out your menu.

Give away free food, offer special discounts, open up a raffle, or play music at your event to get people excited about what you have to offer.

Make sure you advertise your opening event in newspapers and on social media so that people know when it is happening.

You can also conduct an email campaign or mail flyers with coupons attached to them in order to bring in new customers and build a loyal following.

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