Forums: Discussions for entrepreneurs and small business.

Juanjo

With most Quizno's you can name your price. Be very careful with this brand, do your due diligence before signing anything, the company is in financial HELL...

mrfranchiseman

By reading all the posts and and the answer of the Subway Owner I have got many ideas for opening my new restaurant. Thank you all.

mrfranchiseman,

I read in one of your posts that payroll runs about 20%.  Does this include the owner working there as an employee or without.

Thanks.

Subway Owner-I know this post is nearly 6 yrs old, but if you are out there, or another subway franchisee, would like to know a little more, going to the seminar this week. When you say you pulled 20% profit, do you mean for your buisness or in your pocket? assuming some of profits after labor/costs you put into development, emergencies,etc. that come up.

Perterwoofer and Cambycam

Labour can run 18-22%, depending on the labour rate in your State/City. That is with the owner having worked 40 hours a week, 20 of which would be making sandwiches or at the cash register...

Cambycam: I used to be an owner, now I am a broker and so I see hundreds of financials and create many for buyers and for analysis. 20% net profit is possible, but NOT the norm. I have seen 23%, and I have seen 10%, and break even. Be careful not to use generalisations in your projections. Each existing store has numbers that can be worked to get a reliable indication of what sort of profit can be made per month, NOT counting equity build up and debt service..

mrfranchiseman, 25 years with the Subway brand

Thank you SubwayOwner

I am seriously looking into buying a Subway Franchise and after seeing many of the previous posts before yours, I was concerned that I might be making the wrong move, and believe me I realize Nothing in this world is garenteed and Location is a Big thing with Subway. I am willing to put in the $ & time I just want to try to make sure if I do that I get 1/2 a chance at being successful and possibly getting another one. But I think you gave me a little hope that Possibly it may turn out to be a good decision.

  Thanks Again: Bizmikey

When someone says: "I am making 15% profit"

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,

fcmonteiro

15% profit means after all expenses are paid, so that is the cash flow you take home. The difficulty arises when some people work 80 hours a week or 20 hours a week, and you don't know what number of hours each owner is talking about. Assume 40 hours as that would be a normal assumption......then arises the question of whether that cash flow is before or after debt service...and so the inaccuracies go on, as some people also lease equipment.....they hire managers because they don't want to do the work........GOT IT???

mrfranchiseman.com

Hi folks,

I’m currently located in Taipei, Tawan, and seriously considering  to own a Subway here for my retirement.  Called their franchise office the other day; a woman on the phone told me I’ll need NTD 2,500k to 4,000k plus ntd 400k franchise fee ( about USD 98,305 to 159,153 altogether based on a Forex rate of 1:29.5) to own a new one.  Then she set me up with a guy who is going to “interview” me in a few days.

My first question - with my experiences interacting with local residents since arriving in this country, I learned they tend to quote me a much higher price after knowing my western background, than they would quote to a local person on the exact same services / products.  When calling Subway, I was thinking calling to an American company (Subway Taiwan) so let my guards down.  After the call, it suddenly dawned on me Subway Taiwan could be very different from Subway USA, or Canada. So I’m just wondering if anyone here can tell me if the numbers they gave me was true and not inflated? I know Taiwan is probably considered a far off location and perhaps few people would know, but I thought I’d take a chance.

Second question is - I’ll turn 50 very soon.  At my age, it’s hard to get any jobs here.  That’s why I’m considering Subway. I was a hospitality management major for one year only and worked through my college p/t at a Subway. But that was 20+ years ago (I worked mostly as a day-to-day sub teacher for public schools in the states so that's not HM). I have some saving that can cover about 80% of the low number they quoted me to own a Subway here.  I still have some funds in my IRA but I'll have to pay penalty if withdrawing now. So I try to avoid that. Physically, I’m still vibrant since I exercise regularly and religiously in the last 15 years, and I don’t mind hard work at all. What I’m concern is this is all the savings I have and if for any reason I should fail in this Subway endeavor, I’ll  end up with nothing for my nest eggs, except my IRA and teacher's retirement pension, neither of which is significant enough for retirement because my income wasn't high when teaching. But if I can make the Subway thing work, then at least I’ll be making some money every month.  But I feel extremely nervous about this.  I’m just wondering if there’s  any statistics on the succeeding / failing ratios on a new Subway franchise available?

Third question – Is the person who is going to “interview” me the “DA” you folks were referring to? What kind of “tests” I’ll have to take in this interview to determine if I’m a qualified Subway franchisee?

I’m quite familiar with the culture here but not totally.  If you’re familiar with the local Subway operations here in Taiwan, I’d greatly appreciate if you could offer me some insight. Thank you.

Subway Taipei told me the minimum investment to own a Subway in Taipei, about USD 98k+, would be a Subway in a food court. It's cheaper because it's smaller. Does anyone have experiences running Subway franchises in a food court setting? Are there any pointers we should learn particularly on this? All inputs are highly appreciated.