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Firehouse Subs Franchise Cost Worth Opening One?

Written by: Owen Boyd
Last Updated: November 23, 2021
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Firehouse Subs Franchise Cost Worth Opening One?

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:

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 expediture Low Amount High Amount Method of payment When due To whom payment is to be made
Deposit $2,500 $2,500 Lump Sum Payable on signing deposit Agreement Us
Balance of Initial Franchise Fee (Less any Deposit) $17,500 $17,500 Lump Sum Payable on signing Franchise Agreement Us
Mural $2,600 $4,300 Lump Sum Payable at time of order Artist
Travel and Living Expenses during Training $0 $5,000 As incurred As incurred Third Parties
Opening Advertising $5,000 $9,600 As Incurred As incurred Third Parties
Rental of Site (3 months) $7,000 $89,880 As Incurred Monthly Third Parties
Real Property Improvements $0 $31,477 Monthly Monthly Third Parties
Leasehold Improvements $100,642 $343,982 Prior to Opening As Incurred Third Parties
Deposits and Prepaid Expenses $0 $45,525 Prior to Opening Lump Sum Third Parties
Signs $2,690 $23,500 Prior to Opening As Incurred Third Parties
Equipment and Fixtures $44,292 $150,000 Prior to Opening As Incurred Third Parties
Opening Inventory $7,000 $20,000 Prior to Opening Lump Sum Third Parties
Business Licenses $350 $19,298 Prior to Opening Lump Sum Third Parties
Insurance $0 $5,837 As Agreed As Incurred Third Parties
Additional Funds (Working Capital — 3 months) $0 $75,000 As Agreed As Incurred Third Parties
MIS System Fee $0 $1,900 Prior to Opening Lump Sum Us
Accounting System Fee $0 $12,000 As incurred As Incurred Third 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 $50,000 Lump Sum On signing the Development Agreement Us
Vehicle $12,000 $18,000 Prior to Opening As incurred Third Parties
TOTAL ESTIMATED INITIAL INVESTMENT UNDER THE AREA DEVELOPMENT PROGRAM $221,574 $985,299

End-Cap Strip Mall Restaurant with Drive Thru

Type of expediture Low Amount High Amount Method of payment When due To whom payment is to be made
Deposit $2,500 $2,500 Lump Sum Payable on signing deposit Agreement Us
Balance of Initial Franchise Fee (Less any Deposit) $17,500 $17,500 Lump Sum Payable on signing Franchise Agreement Us
Mural $3,000 $5,000 Lump Sum Payable at time of order Artist
Travel and Living Expenses during Training $0 $22,000 As incurred As incurred Third Parties
Opening Advertising $5,000 $8,000 As Incurred As incurred Third Parties
Rental of Site (3 months) $13,125 $16,500 As Incurred Monthly Third Parties
Real Property Improvements $0 $0 Monthly Monthly Third Parties
Leasehold Improvements $164,390 $287,645 Prior to Opening As Incurred Third Parties
Deposits and Prepaid Expenses $0 $8,000 Prior to Opening Lump Sum Third Parties
Signs $7,920 $13,126 Prior to Opening As Incurred Third Parties
Equipment and Fixtures $84,384 $205,883 Prior to Opening As Incurred Third Parties
Opening Inventory $10,044 $33,100 Prior to Opening Lump Sum Third Parties
Business Licenses $0 $1,500 Prior to Opening Lump Sum Third Parties
Insurance $550 $12,326 As Agreed As Incurred Third Parties
Miscellaneous Expenses (3 months) $0 $90,000 As Agreed As Incurred Third Parties
Additional Funds (Working Capital — 3 months) $0 $75,000 As Agreed As Incurred Third Parties
MIS System Fee $600 $1,200 Prior to Opening Lump Sum Us
Accounting System Fee $0 $2,000 As incurred As Incurred Third 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 $50,000 Lump Sum On signing the Development Agreement Us
Vehicle $12,000 $18,000 Prior to Opening As incurred Third Parties
TOTAL ESTIMATED INITIAL INVESTMENT UNDER THE AREA DEVELOPMENT PROGRAM $341,013 $869,280

Free Standing Restaurant with Drive Thru

Type of expediture Low Amount High Amount Method of payment When due To whom payment is to be made
Deposit $2,500 $2,500 Lump Sum Payable on signing deposit Agreement Us
Balance of Initial Franchise Fee (Less any Deposit) $17,500 $17,500 Lump Sum Payable on signing Franchise Agreement Us
Mural $2,400 $3,500 Lump Sum Payable at time of order Artist
Travel and Living Expenses during Training $0 $7,728 As incurred As incurred Third Parties
Opening Advertising $5,000 $8,500 As Incurred As incurred Third Parties
Rental of Site (3 months) $13,496 $23,000 As Incurred Monthly Third Parties
Real Property Improvements $0 $100,000 Monthly Monthly Third Parties
Leasehold Improvements $169,700 $495,600 Prior to Opening As Incurred Third Parties
Deposits and Prepaid Expenses $0 $10,756 Prior to Opening Lump Sum Third Parties
Signs $2,500 $48,000 Prior to Opening As Incurred Third Parties
Equipment and Fixtures $132,774 $132,774 Prior to Opening As Incurred Third Parties
Opening Inventory $6,900 $27,092 Prior to Opening Lump Sum Third Parties
Business Licenses $250 $1,000 Prior to Opening Lump Sum Third Parties
Insurance $500 $7,000 As Agreed As Incurred Third Parties
Miscellaneous Expenses (3 months) $15,000 $35,000 As Agreed As Incurred Third Parties
Additional Funds (Working Capital — 3 months) $0 $75,000 As Agreed As Incurred Third Parties
MIS System Fee Based on only 1 Restaurant that paid the full $1,200 prior to opening in 2019 $900 $1,200 Prior to Opening Lump Sum Us
Accounting System Fee $0 $1,200 As incurred As Incurred Third 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 $50,000 Lump Sum On signing the Development Agreement Us
Vehicle $12,000 $18,000 Prior to Opening As incurred Third Parties
TOTAL ESTIMATED INITIAL INVESTMENT UNDER THE AREA DEVELOPMENT PROGRAM $381,420 $1,065,320

 

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

 

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 Restaurants 185 276 353 204 34
Total # of Restaurants $1,052 $1,052 $1,052 $1,052 $1,052
% of Franchise Restaurants 17.6% 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 average 71/38% 131/47% 174/42% 111/54% 21/62%
Median $19,235 $15,283 12,508 9,94 7,328
High $38,214 $16,941 $13,987 $10,996 $7,328
Low $17,017 $14,012 $11,024 $8,008 $5,367

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 Restaurants 8 7 5 3 0
Total # of Restaurants 23 23 23 23 0
% of Franchise Restaurants 34.8% 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 average 4/50% 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 Restaurants 16 6 10 1 1
Total # of Restaurants 34 34 34 34 34
% of Franchise Restaurants 47.18% 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 average 7/44% 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

2019 Average Sales: $730,711.54

Based on a midpoint investment of $593,447 with estimated profits of

 

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 Restaurants 212 261 307 219 43
Total # of Restaurants $1,042 $1,042 $1,042 $1,042 $1,042
% of Franchise Restaurants 20.3% 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 average 77/36% 118/45% 158/51% 123/56% 24/56%
Median $19,741 $15,549 12,787 $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

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 Restaurants 22 7 10 0 0
Total # of Restaurants 39 39 39 39 39
% of Franchise Restaurants 56.4% 18.0% 25.6% 0% 0%
Average Unit Weekly Sales Volume $24,325 $15,872 $12,681 $0 $0
Number and percentage exceeding average 9/40.9% 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

 

2020 Average Sales: $739,072.75

Based on a midpoint investment of $593,447 with estimated profits of

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

2020 2019
Revenues:
Royalty Fees $43,007,886 47,678,756
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%. 

 

CTA Franchise Specialist 2

 

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 type Year Outlets at the Start of the Year Outlets at the End of the Year Net Change
Franchised 2018 1,051 1,093 +42
2019 1,093 1,115 +22
2020 1,115 1,114 -1
Company-Owned 2018 37 37 0
2019 37 38 +1
2020 38 38 0
Total Outlets 2018 1,088 1,130 +42
2019 1,130 1,153 +23
2020 1,153 1,152 -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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