As a franchisee, you’ll be part of a team that values quality, community, and, of course, tasty subs. Penn Station Franchise is dedicated to sourcing the freshest ingredients and providing exceptional service. Franchisees rave about the support they receive from corporate in all aspects of operations. If you’re looking for a proven concept, a dedicated support team, and the opportunity for high returns, Penn Station could be the perfect fit. Fill out an application on their website to start a conversation about how you can become part of their delicious success story. With over 312 locations, Penn Station East Coast Subs is a well-known franchise in the US.
How much does a Penn Station franchise cost?
Penn Station East Coast offers affordable franchise opportunities, with total cost ranging from $365,361 to $696,030.The initial franchise fee for a Penn Station location is $25,000. This fee covers the rights to use the Penn Station brand and business model. It allows you access to Penn Station’s training, marketing, and operational support.
Penn Station Franchise Price and Cost
Penn Station Franchise Fee
$25,000
Penn Station Franchise Cost
$365,361 to $696,030
Royalty Fee
8% of gross sales
Advertising Fee
3% of gross sales (1% national, 2% local)
Term of Agreement
10 years
Is franchise term renewable?
Yes
Renewable Franchise Fees
There may be a renewal fee, but the exact amount is not publicly available. It’s essential to review the Franchise Disclosure Document (FDD) for specific details on franchise costs, terms, and renewal fees.
In addition to the franchise fee, you’ll need to budget for other expenses
Lease payments: rent, utilities, insurance, etc. for your restaurant space This can vary significantly based on your location.
Equipment: things like signs, kitchen equipment, furniture, etc. Penn Station estimates this will cost between $100,000 and $200,000.
Opening inventory: food, beverages, paper goods, and other supplies for your first 2-4 weeks of operation Around $10,000 to $30,000.
Training: Penn Station requires all new franchisees and key staff to complete training at their headquarters. Budget around $5,000 for travel and living expenses during the initial training period.
Grand opening marketing: advertising and promotional campaigns to spread the word about your new restaurant Typically $20,000 to $50,000.
Additional funds: Penn Station recommends having at least $100,000 in additional working capital when you first open to cover any unforeseen costs.
How much does a Penn Station franchise cost?
Penn Station East Coast offers affordable franchise opportunities, with total cost ranging from $365,361 to $696,030.The initial franchise fee for a Penn Station location is $25,000. This fee covers the rights to use the Penn Station brand and business model. It allows you access to Penn Station’s training, marketing, and operational support.
Penn Station Franchise Price and Cost
Penn Station Franchise Fee
$25,000
Penn Station Franchise Cost
$365,361 to $696,030
Royalty Fee
8% of gross sales
Advertising Fee
3% of gross sales (1% national, 2% local)
Term of Agreement
10 years
Is franchise term renewable?
Yes
Renewable Franchise Fees
There may be a renewal fee, but the exact amount is not publicly available. It’s essential to review the Franchise Disclosure Document (FDD) for specific details on franchise costs, terms, and renewal fees.
In addition to the franchise fee, you’ll need to budget for other expenses
Lease payments: rent, utilities, insurance, etc. for your restaurant space This can vary significantly based on your location.
Equipment: things like signs, kitchen equipment, furniture, etc. Penn Station estimates this will cost between $100,000 and $200,000.
Opening inventory: food, beverages, paper goods, and other supplies for your first 2-4 weeks of operation Around $10,000 to $30,000.
Training: Penn Station requires all new franchisees and key staff to complete training at their headquarters. Budget around $5,000 for travel and living expenses during the initial training period.
Grand opening marketing: advertising and promotional campaigns to spread the word about your new restaurant Typically $20,000 to $50,000.
Additional funds: Penn Station recommends having at least $100,000 in additional working capital when you first open to cover any unforeseen costs.
How much do Penn Station franchise owners make?
So you’re interested in owning your own franchise? One of the biggest questions on your mind is probably how much money franchise owners make. Let’s break down the numbers. The average franchise owners salary or income cash flow is $73,000 per year. However, income can vary significantly based on factors like location, experience, local competition, and overall business acumen. Some owners report earning over $200,000 per year.
With the right location and solid business skills, this franchise can be very profitable. Penn Station has over 300 locations across 15 states, showing the brand has strong growth potential. As the fast-casual restaurant segment continues to grow, Penn Station is well-positioned to capture more of the market.
What is Penn Station?
A fast-casual restaurant franchise named Penn Station East Coast Subs specializes in providing premium sub sandwiches that are grilled to order. Jeff Osterfeld established the brand in Cincinnati, Ohio, in 1985, and it now has more than 300 stores nationwide.
They provide a range of hot and cold subs cooked with hand-cut vegetables, daily-baked bread, and freshly-sliced meats and cheeses on their menu. Penn Station East Coast Subs serves fresh-cut fries and their renowned hand-squeezed lemonade in addition to their iconic subs. The restaurant franchise has become well-known and has expanded as a result of its dedication to quality, freshness, and exceptional customer service.
Is Penn Station a franchise opportunity?
Yes, Penn Station East Coast Subs has franchise options. Since 1987, the company has used franchising to increase its footprint in the United States. Owning and running your own Penn Station East Coast Subs restaurant is possible if you become a franchisee. This eatery is known for its hand-squeezed lemonade, freshly-cut fries, and sub sandwiches that are cooked to order.
Facts That Nobody Told You About Penn Station
Named for a well-known train station: Jeff Osterfeld, the company’s founder, chose the name Penn Station East Coast Subs to honour Pennsylvania Station (formerly known as Penn Station) in New York City. His inspiration for the brand’s identity and menu came from the frantic energy and connection to the East Coast counterculture.
Rapidly growing: Penn Station East Coast Subs has expanded to more than 300 locations nationwide since it was founded in 1985. This brand’s appeal and the franchise model’s success are shown by its quick expansion.
Offerings for seasonal sandwiches: Penn Station East Coast Subs offers a seasonal rotating menu of sandwiches in addition to their standard menu. These unique dishes, including the Turkey Avocado and the Chicken Artichoke Florentine, keep the menu interesting and fresh for returning customers.
Philanthropic efforts: Penn Station East Coast Subs is committed to giving back to the communities it serves. The company supports various charitable organizations and initiatives, such as the “Athlete of the Month” program, which recognizes and rewards outstanding high school athletes in the markets where their restaurants are located.
Focus on quality and freshness: Penn Station East Coast Subs prides itself on using high-quality, fresh ingredients in its menu items. Their sandwiches are made-to-order and feature freshly sliced meats and cheeses, as well as hand-cut vegetables. The bread used for the subs is baked fresh daily, and their signature hand-squeezed lemonade is made from scratch in each restaurant.
1226 US Highway 50, Milford, Ohio 45150, United States
Penn Station Franchise Requirements
So you’re interested in opening your own This franchise, huh? That’s great news: Penn Station is an established brand with over 300 locations across the U.S. But before you dive in, it’s important to understand their requirements to make sure it’s the right opportunity for you.
To qualify as a franchisee, you’ll need a net worth of at least $500,000 and $200,000 in liquid assets. You’ll also need to pay an initial franchise fee of $25,000. Penn Station prefers candidates with business experience, especially in the food service industry. They offer training, but running a restaurant is challenging work, so experience is a plus.
Penn Station also wants franchisees fully committed to the business. As an owner, you’ll need to be hands-on, especially when getting started. You can expect to put in long hours, including nights and weekends. The good news is that Penn Station has a proven business model and a dedicated support team to help set you up for success.
Penn Station Training for Franchises
As a new Penn Station franchisee, you’ll go through an initial training program to prepare you to operate your sub shop. This will cover all aspects of running the business, from making sandwiches to managing employees.
The initial training lasts about 2 weeks and takes place at Penn Station’s headquarters. You’ll learn directly from experienced staff and get hands-on experience in a working subshop. Some of the areas covered include:
Sandwich-making techniques Learn how to slice meats and cheeses to Penn Station’s specifications and properly assemble subs.
Customer service. Develop skills to provide friendly service and build rapport with customers.
Understand how to order supplies, schedule employees, keep the dining room and kitchen clean, and ensure food safety standards are met.
Learn how to promote your sub shop through social media, local advertising, and community outreach. Penn Station will provide marketing materials and guidance.
Penn Station Operations for Franchises
As a franchisee, you’ll be responsible for the day-to-day operations of your Penn Station location. Penn Station has a proven business model and support system in place to help set you up for success.
Before you open your doors, Penn Station requires all new franchisees and their key employees to complete an initial training program. This multi-week program covers everything from food preparation and customer service to marketing and accounting. Penn Station’s operations manual provides detailed instructions and best practices for running your subshop efficiently.
Penn Station is known for high-quality subs, salads, and sides at affordable prices. The menu focuses on fresh ingredients and includes crowd favourites like the Italian sub, cheesesteak, and fresh-cut fries. Penn Station conducts ongoing market research to keep the menu innovative while maintaining its core items. As a franchisee, you’ll have access to Penn Station’s recipes, approved suppliers, and product specifications to ensure consistency across all locations.
Marketing
Penn Station’s marketing team creates advertising campaigns, social media content, and promotional offers that individual franchisees can utilize. They also provide guidance on local store marketing to help boost your visibility in the community. Many franchisees sponsor local sports teams, participate in charity events, and offer specials for schools and businesses in their area.
How is Penn Station’s East Coast Subsidiary Territory Granted to Franchises?
Penn Station East Coast Subs grants franchises based on geographic territories to give franchisees the best opportunity for success. Territories are designed to provide a protected area for the development and operation of Penn Station locations.
Several factors determine how Penn Station territories are mapped out:
Population density and traffic patterns: Territories aim to capture areas with high concentrations of potential customers and easy access.
Competition: Territories are created to minimize direct competition from other Penn Station locations or similar restaurants. Each territory has a protected radius to give franchisees space to build their businesses.
Growth opportunities: territories that can support multiple locations over time are preferable. Penn Station looks for areas that can sustain long-term development.
Local knowledge: Franchise candidates with experience in a particular market may receive priority for territories they know well. Their understanding of the area helps set them up for success.
What is the franchise term of agreement and renewal?
The initial franchise term of agreement for Penn Station East Coast Subs is 10 years. During this time, you’ll pay an ongoing monthly royalty fee of up to 8% of gross sales to use the Penn Station brand and business model.
After the initial 10-year term is up, you have the option to renew your franchise agreement for an additional 10 years. Penn Station aims for long-term relationships with its franchisees, so renewal is very common. To renew, you’ll need to:
Meet Penn Station’s minimum performance standards and brand standards over the life of your current agreement. This includes things like customer service, quality, and sales targets.
Pay a renewal fee of $10,000. This renews your right to use the Penn Station trademarks and business systems for another decade.
Continue paying the monthly royalty of up to 8% on gross sales. Royalty fees provide revenue for Penn Station to continue improving the brand and supporting franchisees.
Upgrade your location if needed. Penn Station may require some renovation or reimaging of older locations to maintain a consistent brand experience. They aim to keep locations looking fresh, modern, and appealing to customers.
Attend retraining. Penn Station provides ongoing training and support for franchisees. Retraining at renewal helps ensure you and your staff are up-to-date with the latest operational procedures, food safety standards, and customer service best practices.
Does Penn Station provide financial assistance to franchisees?
Penn Station East Coast Subs wants to see their franchisees succeed, so they offer several options to help make the initial investment in a franchise more affordable and less risky.
Financing Programs
Penn Station East Coast Subs works with third-party lenders to provide financing for qualified franchisees. They offer programs for:
Down payment assistance covers a portion of the initial franchise fee, so you have less money tied up to get started.
Startup costs: provide funding for equipment, inventory, marketing, and other expenses needed to launch your business.
Working capital: This gives you money to operate the business in the early days before sales and profits start coming in.
The specific terms and rates will depend on your own financial situation and credit. But Penn Station aims to make the process as straightforward as possible.
Discounts and incentives
Penn Station East Coast Subs frequently offers discounts and special financing for military veterans, first responders, and minority business owners. They also provide incentives for multi-unit operators, so if you’re interested in opening more than one location, be sure to ask about any current franchisee incentives or discounts that may apply.
Pros and Cons of Owning a Penn Station Franchise
Low cost of entry
One of the biggest pros of owning this franchise is the relatively low cost of entry. Franchise fees start at only $25,000, and the total investment required is between $365,361 and $696,030. For a fast food franchise, that’s very affordable. You’ll have access to an established brand and business model without needing to invest millions of dollars upfront, like some other franchises require.
Operational Support
Penn Station provides a lot of support for its franchise owners. They offer initial and ongoing training, site selection assistance, and marketing support. They have a proven business model and procedures in place that they will teach you. You’ll also have the opportunity to learn from more experienced franchisees. This level of support can help set you up for success as a new business owner.
Demand for the Product
Sub sandwiches are always in demand, and Penn Station has a loyal customer base. People love their fresh-baked subs, fries, and shakes. The brand has shown consistent growth over the years, so as a franchise owner, you’ll have the potential for a steady revenue stream and the opportunity to continue expanding.
Long Hours
However, owning this franchise also means long hours, late nights, and weekend work. As with any restaurant, there are early mornings, food prep, and closing duties that you’ll have to oversee or do yourself, at least initially. The hours can be grueling, especially when you’re first getting started. Make sure you understand the time commitment involved before pursuing a franchise opportunity.
Royalty Fees
You’ll also have to pay ongoing royalties and marketing fees to Penn Station, which will cut into your profits. Royalties are up to 8% of net sales, and the marketing fee is 2% of net sales. While the fees provide the benefits of the brand and support, they do represent a significant cost over the life of your franchise.
What are Penn Station franchise reviews?
Penn Station East Coast Subs is a popular franchise option for those interested in owning a business in the food industry. While I couldn’t find specific reviews regarding the franchise experience, the company has a reputation for its premium products, which contributes to its success.
Penn Station Franchise Rankings
Entrepreneur’s Franchise 500: Penn Station has been consistently ranked in Entrepreneur Magazine’s annual Franchise 500 list. In the 2023 rankings, they were listed at #374. You can find a reference to this ranking on Entrepreneur’s website.
Franchise Times Top 300+: In 2020, Penn Station was ranked #227 on the Franchise Times Top 300+ list, which is a ranking of the 500 largest franchise systems in the United States by global systemwide sales. You can find a reference to this ranking on the Franchise Times website.
Franchise Deck Analysis and Overview
Penn Station East Coast Subs charges an ongoing monthly royalty fee of 8% of gross sales. They also collect a monthly marketing fee of 2% of gross sales to fund national and regional marketing campaigns. These fees are fairly standard for the restaurant industry, but be sure you can generate enough revenue to cover them in addition to your other expenses.
Like most franchises, Penn Station East Coast Subs places certain restrictions and requirements on franchisees to maintain brand consistency. This includes following their procedures for operations, customer service, store design, and product offerings. You will be obligated to use their approved suppliers and purchase materials only from Penn Station East Coast Subs or their designated distributors. There are also geographic restrictions on where you can open new locations to avoid saturating the market. Make sure you fully understand all your obligations before signing a franchise agreement.
While the total investment and ongoing fees for this franchise are substantial, the profit potential can also be appealing. Some of the franchises have an average net profit of over $200,000 per year. However, there is no guarantee of success, and your results will depend on factors like location, customer traffic, competition, and effective management of operations. Conduct a thorough analysis of the opportunity based on your local market to determine if the rewards outweigh the risks.
Conclusion: Should you buy a Penn Station franchise for sale?
So, should you buy this franchise for sale? Overall, Penn Station looks like an appealing franchise opportunity, especially if you’re interested in a fast-casual restaurant model with the potential for high profit margins. However, as with any franchise, there are some downsides to consider.
The initial investment and startup costs are substantial, typically ranging from $365,361 to $696,030 to get a new location up and running. The total investment will depend on factors like real estate costs in your area.
Royalty and marketing fees are an ongoing expense, currently up to 8% of gross sales. You’ll need to generate strong sales volume to offset these costs and turn a good profit.
There is competition from other sub shop franchises. You’ll need to provide great food and service to stand out.
There are risks inherent to any food service business, like fluctuating food costs, employee turnover, and changes in consumer tastes.
Overall, if you go into this opportunity with realistic expectations, develop a solid business plan, choose a prime location, and are willing to put in the work to build a successful operation, this franchise could be very rewarding. The potential to build equity in a business and eventually sell it or pass it onto someone else is appealing to many entrepreneurs. But make no mistake—it will require an investment of both money and time to get started and keep things running smoothly.
Entrepreneurs who want to open a franchise in the sandwiches franchise opportunities categories can look at
The profitability of this franchise depends on various factors, such as location, management, and market demand. While there is potential for profitability, individual results may vary. It’s essential to do research, speak with current franchisees, and review the Franchise Disclosure Document (FDD) for financial performance representations.
Can you make money owning a Penn Station?
Yes, it’s possible to make money owning this franchise, but profitability is not guaranteed. Success depends on factors like effective management, location, and market demand. Prospective franchisees should conduct thorough research and consult with existing franchisees to better understand the potential for financial success.
Is Penn Station a franchise?
Yes, Penn Station East Coast Subs is a franchise. They offer franchise opportunities to qualified individuals interested in owning and operating their own Penn Station restaurant.
How much is a Penn Station franchise?
The total initial investment for this franchise ranges from approximately $365,361 to $696,030. This includes a $25,000 franchise fee and other start-up costs such as equipment, construction, and inventory.
How do Penn Station franchises make money?
This franchise generates revenue primarily through the sale of their signature sandwiches, wraps, salads, and other menu items. Additionally, they earn income from catering services and other promotional events. Franchisees pay a up-to-8% royalty fee on gross sales and a 3% advertising fee (1% national, 2% local) to the franchisor.
