Sandwich shops make up a sizeable portion of the restaurant industry, with 17 of the 250 biggest restaurant chains in the world belonging to this food category. And among these sub and sandwich restaurants, franchising seems to be especially popular. In fact, two of the nine biggest sandwich chains in the U.S. are 100% franchisee-owned. Unlike the pizza industry, where none of the six biggest U.S. pizza chains are fully franchised.
So what makes the sandwich industry so much different? After all, sandwich and pizza shops have similar point-of-sale needs and involve operations largely based on complex create-your-own orders. Research says that franchising is so prevalent in the sandwich shop industry for the following reasons:
1. Low Initial Investment Cost
Franchising appeals to budding entrepreneurs because it often comes with a slightly lower initial investment. This doubles for sandwich franchises, which don’t require a lot of the more expensive pizzeria equipment.
Several big-name sub and sandwich brands will allow you to franchise a location for $350,000 or less; Papa John’s is one of the only well-established brands with a franchise cost this low within the pizza industry.
As a potential franchisee, this low-cost startup fee makes going into the sandwich business very appealing. And from a restaurant chain owner's perspective, one of your most effective expansion tools would be to do everything in your power to maintain a low total initial investment required from your future franchisees.
2. Established Clientele and Brand Recognition
A major struggle for any restaurant startup is getting your name out there. That’s why the average small restaurant spends 11% of its revenue on marketing. Meanwhile, most sandwich shop franchisees are only required to contribute anywhere from 2-5% towards marketing. A big part of this is that a franchised restaurant already has an existing fanbase, and may even be a household name.
This doesn’t mean that it’s only beneficial to franchisees, however. The more locations opened, the faster customers will be exposed to your brand, strengthening brand recognition for your whole chain.
But the benefits of having an already established clientele include more than just savings on your sub or pizza marketing strategy. It also means you’re less likely to fall victim to a slow initial trickle of customers and revenue.
From the time of your grand opening, it takes two to three years before a restaurant turns profitable, on average. It takes a while to build up a significant reputation and customer base, go through the trial-and-error of matching food costs to menu prices, and do everything else it takes to create a successful restaurant. But franchising with an existing sandwich brand allows you to streamline a lot of this and reduce the time it takes to become profitable.
3. Versatile Love For Sandwiches
Another part of what attracts so many franchisees to sandwich chains is that sandwiches are a timeless favorite in America and worldwide. In fact, sandwiches account for four of Eat This’s top ten most popular fast food items.
So no matter what type of sandwich shop you operate, chances are that there’s a space for you to exist in basically any neighborhood. Especially if you offer a versatile selection of sandwiches that can appeal to a wide range of personal tastes, it’s an optimistic investment for your franchisees and an excellent incentive for you to sign on as many additional locations as possible.
Between cheaper startup costs, better brand recognition, and universal love of sandwiches, it’s no surprise why franchising is such a common practice among sub and sandwich shops. But whether you’re preparing to franchise your existing sub and sandwich business or just trying to open your first sandwich restaurant, you’ll need a point-of-sale system specifically designed for the complexities of the sandwich industry. Find out what makes the perfect sub and sandwich POS for franchises and where you can get one.
Posted on Thu, Jun 02, 2022 @ 08:06 AM.
Updated on June 6, 2022 @ 4:12 PM PST.