“Subway franchisees need less money because the sandwich chain’s restaurants are cheaper to open.”
Have you ever wondered how much it would cost you to open your own Subway, McDonald’s or other fast food restaurant? Compared with other fast food restaurant chains, Subways have a relatively low start-up cost.
Subway requires franchisees to have liquid assets of at least $30,000, compared to McDonald’s which requires it’s franchisees to have at least $750,000 in liquid assets.
And Subways are relatively cheap to open. Including construction and equipment leasing expenses, initial capital requirements are about $116,200 to $262,850, according to the company.
Yet, there’s a trade off. While the cost of opening a McDonalds is significantly higher, as much as $2.3 million, it can generate as much as $2.5 million in annual revenue. A Subway restaurant, on average, generates only $490,000 in annual revenue.
But Subway is not the only franchise with low start-up cost. Search the BizBuySell Franchise Directory and you’ll find many franchises with capital requirements starting at just $25,000, including Firehouse Subs, 7-Eleven and Minuteman Press.