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Firehouse Subs Franchise Cost For 2023 Worth It?

Written by: Owen Boyd
Last Updated: January 18, 2023
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Firehouse Subs offers hot submarine-style sandwiches at affordable prices in a unique fire-fighting-themed atmosphere. Their popular menu items include the Barbecue Cuban Sub, Italian Sub, and Hook and Ladder Sub.

Firehouse Subs was founded by brothers Chris and Robin Sorenson who come from a line of police officers and firefighters and previously served as firefighters themselves. Their first location opened in Jacksonville, FL in 1994, and since they began offering franchises in 2005, they have grown to over 1,180 locations across 46 states, Puerto Rico, and Canada. The Current CEO is Don Fox, who has held that position since 2009. Before becoming CEO, Fox served as Chief Operating Officer.

As of 2020, there were 1,114 franchised outlets and 38 corporate outlets. Of the franchised outlets, the vast majority (over 1,000) were traditional restaurants, as opposed to end-cap strip mall restaurants with a drive-thru or free-standing restaurant with a drive-thru. 

How is Firehouse Subs Franchise Positioned in the Limited-Service Restaurant Industry?

Firehouse Subs competes in the limited-service restaurant industry, competing with other fast-casual restaurants like Chipoltle, Panera Bread, and Panda Express. It most directly competes in this space with other restaurants specializing in submarine-style sandwiches like Subway, Jersey Mike’s, and local sub shops. It sets itself apart by emphasizing its flavorful meats and hearty portion sizes – big enough to satisfy a firefighter’s appetite.

How Much is a Firehouse Subs Franchise?

The initial Firehouse Subs Franchise Fee is $20,000. You have to pay this upfront fee when opening a Firehouse Subs franchise.


The more Firehouse Subs franchises you invest in, the greater the opportunity for profit.


Firehouse Subs Franchise Cost

The estimated total investment necessary to begin operation of a Firehouse Subs varies depending on the characteristics of the restaurant site, as summarized below:

  • Traditional restaurant: $189,574 to $917,299
  • End-cap strip mall restaurant with a drive-thru: $309,013 to $801,280
  • Free-standing restaurant with a drive-thru: $349,420 to $997,320

Franchise ranges from $189,574 to $997,320

The following costs are part of the upfront costs included in the initial investment for a Firehouse Subs location. Many of these are one-time fees that are needed to launch the franchise. Review the chart below to see how much it costs to buy a Firehouse Subs franchise in 2021. 

firehouse subs logo

Firehouse Subs Franchise Cost (Detailed, by Site Type)

Traditional Restaurant

Type of expeditureLow AmountHigh AmountMethod of paymentWhen dueTo whom payment is to be made
Deposit$2,500$2,500Lump SumPayable on signing deposit AgreementUs
Balance of Initial Franchise Fee (Less any Deposit)$17,500$17,500Lump SumPayable on signing Franchise AgreementUs
Mural$2,600$4,300Lump SumPayable at time of orderArtist
Travel and Living Expenses during Training$0$5,000As incurredAs incurredThird Parties
Opening Advertising$5,000$9,600As IncurredAs incurredThird Parties
Rental of Site (3 months)$7,000$89,880As IncurredMonthlyThird Parties
Real Property Improvements$0$31,477MonthlyMonthlyThird Parties
Leasehold Improvements$100,642$343,982Prior to OpeningAs IncurredThird Parties
Deposits and Prepaid Expenses$0$45,525Prior to OpeningLump SumThird Parties
Signs$2,690$23,500Prior to OpeningAs IncurredThird Parties
Equipment and Fixtures$44,292$150,000Prior to OpeningAs IncurredThird Parties
Opening Inventory$7,000$20,000Prior to OpeningLump SumThird Parties
Business Licenses$350$19,298Prior to OpeningLump SumThird Parties
Insurance$0$5,837As AgreedAs IncurredThird Parties
Additional Funds (Working Capital — 3 months)$0$75,000As AgreedAs IncurredThird Parties
MIS System Fee$0$1,900Prior to OpeningLump SumUs
Accounting System Fee$0$12,000As incurredAs IncurredThird Parties
TOTAL ESTIMATED INITIAL INVESTMENT UNDER THE UNIT FRANCHISE PROGRAM (EXCLUDING REAL ESTATE PURCHASE COSTS)$189,574$917,299   
Development Fee (based on actual 2019 data)$20,000$50,000Lump SumOn signing the Development AgreementUs
Vehicle$12,000$18,000Prior to OpeningAs incurredThird Parties
TOTAL ESTIMATED INITIAL INVESTMENT UNDER THE AREA DEVELOPMENT PROGRAM$221,574$985,299   

firehouse subs-family

End-Cap Strip Mall Restaurant with Drive Thru

Type of expeditureLow AmountHigh AmountMethod of paymentWhen dueTo whom payment is to be made
Deposit$2,500$2,500Lump SumPayable on signing deposit AgreementUs
Balance of Initial Franchise Fee (Less any Deposit)$17,500$17,500Lump SumPayable on signing Franchise AgreementUs
Mural$3,000$5,000Lump SumPayable at time of orderArtist
Travel and Living Expenses during Training$0$22,000As incurredAs incurredThird Parties
Opening Advertising$5,000$8,000As IncurredAs incurredThird Parties
Rental of Site (3 months)$13,125$16,500As IncurredMonthlyThird Parties
Real Property Improvements$0$0MonthlyMonthlyThird Parties
Leasehold Improvements$164,390$287,645Prior to OpeningAs IncurredThird Parties
Deposits and Prepaid Expenses$0$8,000Prior to OpeningLump SumThird Parties
Signs$7,920$13,126Prior to OpeningAs IncurredThird Parties
Equipment and Fixtures$84,384$205,883Prior to OpeningAs IncurredThird Parties
Opening Inventory$10,044$33,100Prior to OpeningLump SumThird Parties
Business Licenses$0$1,500Prior to OpeningLump SumThird Parties
Insurance$550$12,326As AgreedAs IncurredThird Parties
Miscellaneous Expenses (3 months)$0$90,000As AgreedAs IncurredThird Parties
Additional Funds (Working Capital — 3 months)$0$75,000As AgreedAs IncurredThird Parties
MIS System Fee$600$1,200Prior to OpeningLump SumUs
Accounting System Fee$0$2,000As incurredAs IncurredThird Parties
TOTAL ESTIMATED INITIAL INVESTMENT UNDER THE UNIT FRANCHISE PROGRAM (EXCLUDING REAL ESTATE PURCHASE COSTS)$309,013$801,280   
Development Fee (based on actual 2019 data)$20,000$50,000Lump SumOn signing the Development AgreementUs
Vehicle$12,000$18,000Prior to OpeningAs incurredThird Parties
TOTAL ESTIMATED INITIAL INVESTMENT UNDER THE AREA DEVELOPMENT PROGRAM$341,013$869,280   

firehouse subs-sub

Free Standing Restaurant with Drive Thru

Type of expeditureLow AmountHigh AmountMethod of paymentWhen dueTo whom payment is to be made
Deposit$2,500$2,500Lump SumPayable on signing deposit AgreementUs
Balance of Initial Franchise Fee (Less any Deposit)$17,500$17,500Lump SumPayable on signing Franchise AgreementUs
Mural$2,400$3,500Lump SumPayable at time of orderArtist
Travel and Living Expenses during Training$0$7,728As incurredAs incurredThird Parties
Opening Advertising$5,000$8,500As IncurredAs incurredThird Parties
Rental of Site (3 months)$13,496$23,000As IncurredMonthlyThird Parties
Real Property Improvements$0$100,000MonthlyMonthlyThird Parties
Leasehold Improvements$169,700$495,600Prior to OpeningAs IncurredThird Parties
Deposits and Prepaid Expenses$0$10,756Prior to OpeningLump SumThird Parties
Signs$2,500$48,000Prior to OpeningAs IncurredThird Parties
Equipment and Fixtures$132,774$132,774Prior to OpeningAs IncurredThird Parties
Opening Inventory$6,900$27,092Prior to OpeningLump SumThird Parties
Business Licenses$250$1,000Prior to OpeningLump SumThird Parties
Insurance$500$7,000As AgreedAs IncurredThird Parties
Miscellaneous Expenses (3 months)$15,000$35,000As AgreedAs IncurredThird Parties
Additional Funds (Working Capital — 3 months)$0$75,000As AgreedAs IncurredThird Parties
MIS System Fee Based on only 1 Restaurant that paid the full $1,200 prior to opening in 2019$900$1,200Prior to OpeningLump SumUs
Accounting System Fee$0$1,200As incurredAs IncurredThird Parties
TOTAL ESTIMATED INITIAL INVESTMENT UNDER THE UNIT FRANCHISE PROGRAM (EXCLUDING REAL ESTATE PURCHASE COSTS)$349,420$997,320   
Development Fee (based on actual 2019 data)$20,000$50,000Lump SumOn signing the Development AgreementUs
Vehicle$12,000$18,000Prior to OpeningAs incurredThird Parties
TOTAL ESTIMATED INITIAL INVESTMENT UNDER THE AREA DEVELOPMENT PROGRAM$381,420$1,065,320   

 firehouse subs-manager Tameka

Firehouse Subs Franchise Requirements

In addition to the fees associated with opening a franchise, the Firehouse Restaurant Group requires that franchisors have a minimum of $80,000 to invest, a credit score of at least 650, along with a strong inner drive for excellence, devotion to the Firehouse Subs business, community-mindedness, and a love of subs. 

See the complete franchise requirements provided on the franchisor’s webpage.

Owning a Firehouse Franchise Requires Ongoing Fees
  • Royalty: 6% of gross sales (reduced to 3% of gross sales during first two years of operation)
  • Local Advertising: 4% of gross sales

How much do Firehouse Subs franchise owners make?

2019 Weekly AUV / Franchisees Traditional Development. FYE December 29, 2019

  $17,000+ $14,000—$17,000 $11,000—$14,000$8,000—$11,000$0—$8,000
# of Restaurants18527635320434
Total # of Restaurants$1,052$1,052$1,052$1,052$1,052
% of Franchise Restaurants17.6%26.2%33.6%19.4%3.2%
Average Unit Weekly Sales Volume$20,007$15,339$12,519$9,884$7,328
Number and percentage exceeding average71/38%131/47%174/42%111/54%21/62%
Median$19,235$15,28312,5089,947,328
High$38,214$16,941$13,987$10,996$7,328
Low$17,017$14,012$11,024$8,008$5,367

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2019 Weekly AUV / Franchisees Free-Standing w/Drive Thru Development. FYE December 29, 2019

  $17,000+ $14,000—$17,000 $11,000—$14,000$8,000—$11,000$0—$8,000
# of Restaurants87530
Total # of Restaurants232323230
% of Franchise Restaurants34.8%30.4%21.7%13.0%0%
Average Unit Weekly Sales Volume$22,138$15,044$12,098$9,255$0
Number and percentage exceeding average4/50%5/71%2/40%2/67%0/0%
Median$21,300$14,915$12,005$9,088$0
High$33,561$15,895$13,077$9,947$0
Low$18,242$14,024$11,309$8,161$0

2019 Weekly AUV / Franchisees End-Cap Strip w/Drive Thru Development. FYE December 29, 2019

  $17,000+ $14,000—$17,000 $11,000—$14,000$8,000—$11,000$0—$8,000
# of Restaurants1661011
Total # of Restaurants3434343434
% of Franchise Restaurants47.18%17.6%29.4%2.9%2.9%
Average Unit Weekly Sales Volume$22,177$15,400$12,473$9,646$6,740
Number and percentage exceeding average7/44%3/50%4/40%0/0%0/0%
Median$20,453$15,458$12,448$9,646$6,740
High$35,900$16,675$11,246$9,646$6,740
Low$17,040$14,118$11,246$9,646$6,740

 

firehouse subs-wall

2019 Average Sales: $730,711.54

Initial investment (midpoint)%Profit margin of median franchise salesEstimated Profits Time to recoup investments
$ 593,44710%$ 73,0718 years
15%$ 109,6077 years
20%$ 146,1425 years

2020 Weekly AUV / Franchisees Traditional Development. FYE December 27, 2020

  $17,000+ $14,000—$17,000 $11,000—$14,000$8,000—$11,000$0—$8,000
# of Restaurants21226130721943
Total # of Restaurants$1,042$1,042$1,042$1,042$1,042
% of Franchise Restaurants20.3%25.0%29.4%21.0%4.1%
Average Unit Weekly Sales Volume$20,066$15,261$12,542$9,799$6,966
Number and percentage exceeding average77/36%118/45%158/51%123/56%24/56%
Median$19,741$15,54912,787$9,999$7,221
High$42,690$16,972$13,999$10,999$7,977
Low$17,039$14,014$11,019$8,001$4,961
 
franchise specialist

2020 Weekly AUV / Franchisees Free-Standing w/Drive Thru Development. FYE December 27, 2020

$17,000+ $14,000—$17,000 $11,000—$14,000 $8,000—$11,000 $0—$8,000
# of Restaurants 12 4 6 1 1
Total # of Restaurants 24 24 24 24 24
% of Franchise Restaurants 50.0% 16.6% 25.0% 4.1% 4.1%
Average Unit Weekly Sales Volume $24,231 $15,337 $12,890 $10,848 $6,515
Number and percentage exceeding average 5/42% 2/50% 4/67% 0/0% 0/0%
Median $22,660 $15,609 $13,227 $10,848 $6,515
High $42,289 $16,348 $13,702 $10,848 $6,515
Low $17,163 $14,172 $11,901 $10,848 $6,515

2019 Weekly AUV / Franchisees End-Cap Strip w/Drive Thru Development. FYE December 27, 2020

  $17,000+ $14,000—$17,000 $11,000—$14,000$8,000—$11,000$0—$8,000
# of Restaurants2271000
Total # of Restaurants3939393939
% of Franchise Restaurants56.4%18.0%25.6%0%0%
Average Unit Weekly Sales Volume$24,325$15,872$12,681$0$0
Number and percentage exceeding average9/40.9%4/57%5/50%0/0%0/0%
Median$22,414$16,672$12,846$0$0
High$52,691$16,975$13,714$0$0
Low$17,013$14,218$11,061$0$0

 

firehouse subs-vintage

2019 Average Sales: $739,072.75

Initial investment (midpoint)%Profit margin of median franchise salesEstimated Profits Time to recoup investments
$ 593,44710%$ 73,9078 years
15%$ 110,8615 years
20%$ 147,8154 years

Is the Company Franchise Profit Worth the Franchise Cost?

When Firehouse Subs owners sell their franchise based on the median valuation multiple for the industry of 0.31 and the average sales total from 2019 and 2020 of $734,892, the franchise would sell for $227,817. This is only about 38% of the midpoint investment of $593,447

However, owners of multiple Firehouse Subs franchises are able to sell them at a profit. Owners of 7 Firehouse Sub franchises receiving $5,144,245 can sell their franchises at a multiple of 0.86 for $4,424,050. This is greater than their initial investment amount of $4,154,129. So, the more Firehouse Subs franchises you invest in, the greater the opportunity for profit.

firehouse subs

 

Firehouse of Americas Income Statement:

Firehouse of America, LLC. Statements of Income. Years Ended December 27, 2020 and December 29, 2019

 20202019
   
Revenues:  
Royalty Fees$43,007,88647,678,756
Franchise fees$1,371,750$2,800,750
Area representative fees$421,403$436,960
Other fees$3,949,688$3,531,437
Total revenues$48,750,727$54,447,903
   
Costs and expenses:  
Royalty expense$18,196,469$20,502,344
Franchise fee expense$368,188$735,251
License fee expense$11,200,010$12,725,119
Employee wages and benefits$8,884,021$9,439,277
Telephone and utilities expense$49,891$67,499
Travel and entertainment expense$266,533$651,537
Marketing expenses$404,216$736,598
Occupancy expense$1,697,371$1,702,801
Area franchise development expense$56,250$276,250
Professional fee expense$1,953,457$1,907,242
Depreciation and amortization$248,626$236,711
Other operating expenses$1,536,716$1,976,707
   
Total costs and expenses$44,861,748$50,957,336
   
Operating income$3,888,979$3,490,567
   
Other income (expense)$23$(152,276)
   
Net income$3,889,002$3,338,291
Income Statement Key Insights:

Firehouse Subs has been a profitable business for the franchisor Firehouse of America, with profit margins of 6% and 8% in 2019 and 2020, respectively. They were able to increase profitability from 2019 to 2020 in large part because they were able to cut costs by 12%

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How many Firehouse Subs units have opened and closed?

Over the last three years, Firehouse Subs has been growing at an average of 21 franchises a year. One franchise closed in 2020, but that is not surprising in a year that many restaurants across the country were forced to close due to the pandemic. 

Units opened and closed from 2018 to 2020

Outlet typeYearOutlets at the Start of the YearOutlets at the End of the YearNet Change
Franchised20181,0511,093+42
20191,0931,115+22
20201,1151,114-1
Company-Owned201837370
20193738+1
202038380
Total Outlets20181,0881,130+42
20191,1301,153+23
20201,1531,152-1

Conclusion

Firehouse Subs has seen franchise unit increases over the last three years, and average franchise revenues have increased as well. However, there are high initial costs of opening a franchise, and based on the industry multiple, it will be difficult to sell the franchise at a profit. You are more likely to make a profit if you invest in several Firehouse Subs franchises instead of just one. 

While this may be the business for you, make sure to also check out other businesses offered on Vetted Biz and in Food and Beverage Industry.

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