Potbelly Sandwich Shop Franchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
Potbelly Sandwich Shop is a fast-casual franchise serving toasted sandwiches, salads, soups, and hand-dipped shakes. Franchisees run shops managing food prep, counter service, and staffing in a high-volume setting.
FranchiseVerdict summary · 2026
A Potbelly Sandwich Shop franchise requires a total initial investment of $644K – $1.2M, including a $40K franchise fee and an ongoing 6.0% royalty[2]. Per the 2024 FDD, average unit revenue was $1.2M[2]. SBA 7(a) loans show a 0.0% charge-off rate across 12 loans[1]. FranchiseVerdict grade: A (Strongest tier), an editorial assessment, not investment advice. Run a live ROI scan →
Data last verified · figures per the 2024 FDD issuance
Overview
- Investment
- $644K – $1.2M
- 85th pct Service Resta…
- Avg gross sales
- $1.2M
- 20th pct Service Resta…
- Royalty
- 6.0%
- 46th pct Service Resta…
- Units
- 424
- 88th pct Service Resta…
- SBA charge-off
- 0.0%
- % of SBA 7(a) loans not repaid · median varies by category
Quick verdict · Quick-Service Restaurants · color = vs category peers
Green = favorable by >10% vs Quick-Service Restaurants avg · No shading = within ±10% · Red = unfavorable by >10% · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Bottom line
- COSTTotal investment $644K – $1.2M including a $40K franchise fee, 6.0% ongoing royalty.
- RETURNSAverage unit revenue of $1.2M/year (median $1.2M).
- RISKVerdict A (Strongest tier), verdict score 88/100 (higher is better). SBA loan charge-off rate of 0.0% across 12 loans (well below the franchise average, based on all SBA 7(a) franchise lending, 2010–2025).
- FLAGBankruptcy history disclosed in the FDD. Review Item 4 for details before proceeding.
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- Potbelly Franchising, LLC
- Parent company
- Potbelly Illinois, Inc.
- Ultimate parent
- Potbelly Corporation
- CEO title
- President and Chief Executive Officer
- Robert D. Wright
- Incorporated in
- Illinois
- HQ
- 111 North Canal Street, Suite 325, Chicago, Illinois 60606
- Auditor
- Deloitte & Touche LLP
- Audited financials
- Franchisor revenue
- $3.2M
- vs $4.1M prior year
Affiliated brands
- Potbelly Sandwich Works
Other brands the franchisor or its parent operates (Item 1).
Overview
About
- CEO
- Robert D. Wright
- Headquarters
- IL
- Founded
- 2009
- FDD year
- 2024
- States available
- 22
Can you afford it, and what does the money buy?
Entry cost runs 37% above the typical quick-service restaurants franchise.
Source: FDD 2024 · Items 5–7
Full Item 7 breakdown15 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Fee | $40K | $40K | |
| Rental of Premises (3 months) | $16K | $33K | |
| Construction | $325K | $600K | |
| Leasehold Improvements & Signage | $13K | $56K | |
| Equipment | $97K | $180K | |
| Furniture & Fixtures | $42K | $44K | |
| Technology | $28K | $59K | |
| Training Expenses | $16K | $46K | |
| Insurance (12 months) | $2K | $12K | |
| Professional Fees | $2K | $5K | |
| Business Licenses & Permits | $250 | $2K | |
| Office Equipment & Supplies | $800 | $3K | |
| Market Introduction Program | $25K | $25K | |
| Opening Inventory | $12K | $18K | |
| Additional Funds (3 months) | $25K | $35K | |
| Total initial investment | $644K | $1.2M |
Line items extracted from FDD Item 7. Ranges reflect the franchisor's stated low and high per line. Total is the sum of line-item lows / highs — actual costs may fall outside this range depending on market and build-out scope.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $644K – $1.2M
- Bottom third — review vs category
- Liquid capital req'd
- $25K – $35K
- Middle of category vs category
- Franchise fee
- $40K – $40K
- Middle of category vs category
- Royalty
- 6.0%
- Gross Sales · typical 6–8%
- Ad fund
- 3.0%
- typical 3–5%
- Total fee load
- 9.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 6.0% of gross sales |
| Marketing / ad fund | 3.0% of gross sales |
| Technology fee | $500 |
| Transfer fee | $20K |
| Renewal fee | $10K |
| Inventory (initial) | $12K – $18K |
| Total fee load | 9.0% of rev |
What do units actually make?
Average unit sales land near the quick-service restaurants norm.
Source: FDD 2024 · Item 19
Single-unit · estimated
Returns at a glance
Indicative numbers using FDD Item 7 / Item 19 inputs and category-benchmarked cost ratios. Full single-unit, 25-unit portfolio, and LBO models (with every input editable to stress-test your own scenario) live on the financials page.
Store EBITDA · annual
$158K
13.0% margin
Unlevered ROIC
17%
EBITDA / total invested capital
Payback
5.9 yrs
cash-on-cash, unlevered
ROI & LBO modelsSingle-unit · 25-unit portfolio · editable
What one unit earns on your invested capital
Model A · Single-Unit Return
Computes unlevered return on invested capital (ROIC) for a single franchise unit. The target band for an attractive franchise is 30–60% ROIC. Below that and a passive index fund likely outperforms; above that and the franchisor has pricing power you're subsidizing.
Note: Item 19 revenue is what the franchisor discloses. It's the top line only. Operating costs below are category estimates. Override them to match your real lease quote, labor market, and build-out budget.
Returns model · single-unit ROIC
What would one Potbelly Sandwich Shop unit return on the cash you put in?
Unlevered ROIC · per unit
Estimated return on your total franchise investment, before any debt financing.
17%
Below the 30–60% attractive-franchise band
What 25 units return when you use SBA financing
Model B · Return on Equity: Debt-Financed Acquisition
Models a 25-unit portfolio acquisition financed with an SBA 7(a) loan. Shows equity IRR (your return on cash invested), DSCR (how safely the cash flow covers debt service), and the capital stack (SBA + seller + equity breakdown).
This is the “search fund” or “entrepreneurship through acquisition” scenario: you buy an existing multi-unit operator, use leverage to amplify returns, and either operate or hire management. The 25-unit size is the typical minimum for an SBA-backed franchise portfolio acquisition to pencil as a full-time income.
What “return on equity” means here: if you put in $500K of your own cash and the business generates enough EBITDA to pay down debt and grow, your equity IRR is the annual return on that $500K, including the value created when you eventually sell. Target IRR for a search fund is typically 25–35%.
Levered LBO scenario · Yale Crease Capital framing
What would 25 Potbelly Sandwich Shop units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$1.5M
on $7.3M purchase
Total debt
$5.8M
SBA $3.6M + senior + seller note
These models are for research and scenario planning only. Not investment advice. Actual results depend on your specific location, management, and market conditions. Consult a franchise attorney and accountant before signing any franchise agreement.
Item 19 · Source: 2024 FDD
Financial Performance
- Avg gross sales
- $1.2M
- Per unit, per year
- Median gross sales
- $1.2M
Gross sales are revenue before expenses — not profit. Actual owner earnings depend on rent, labor, royalties, marketing fees, and debt service.
- Item 19 type
- Average/Median Unit Volume (Gross Sales) by segment, 2021-2023
- Sample size
- 74 outlets
- vs category median 20 · large
- Range (low → high)
- $415K→$2.3M
- Cohort dispersion (min → max)
- Transparency tier
- revenue_only
- Categorical assessment of disclosure depth
- Reporting year
- 2023
- Fiscal year the figures cover
- Source filing
- FDD 2024
- Disclosed in the 2024 filing, covering 2023
- Transparency
- 4 / 10
- vs category median 4 / 10 · typical
Compared against 782 Quick-Service Restaurants brands
Operator outlook
What the numbers say
Data-driven interpretation of this brand's financial disclosures, fee structure, and system trajectory.
Unit economics
Average unit generates $1.2M/year in gross sales. Revenue-to-investment ratio: 1.3x.
Fee burden
Total ongoing fee load of 9.0% (near the Quick-Service Restaurants average).
Disclosure
Transparency score 4/10 — this franchisor discloses detailed breakdowns (quartiles, segments, or cohort data). Buyers can model unit economics with higher confidence.
Operator retention
System expanding at 71.7% CAGR over 3 years across 424 units — operators are staying and new ones are joining.
Multi-unit rate
Only 11% of franchisees own multiple units. Could indicate challenging economics or a young system where operators haven't had time to expand.
Source: FDD Item 19 financial performance representations and publicly filed FDD data. Past performance is not indicative of future results. Verify all figures with the franchisor and current franchisees before making any investment decision.
vs Quick-Service Restaurants averages
How Potbelly Sandwich Shop Compares
Is the system healthy?
Source: FDD 2024 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 424
- Opened
- 38
- Last reporting year
- Closed
- 0
- Terminated
- 4
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 5.1%
- Company-owned
- 345
- Corporate units in the system
- % franchised
- 19%
- vs corporate-owned
- Multi-unit owners
- 11.1%
- Net growth (3-yr)
- +71.7%
- Net unit change over 3 years
- 3-yr CAGR
- +71.7%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 38
- Closed (3yr)
- 0
- Terminated (3yr)
- 4
- Non-renewed (3yr)
- 0
- Transfers (3yr)
- 0
- Reacquired (3yr)
- 0
- Franchisor bought back
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 22 states with active franchisees
The Territory Map
Derived from franchisee contact records. Shows states with at least one current operator. Not where the franchisor is registered to sell new units (that data is re-extracting in a future refresh).
States derived from franchisee contact records (FDD Item 20). Shows states with at least one current operator on file. Full state registration data (Item 12) will appear on a future FDD refresh.
Available to sell in · Item 12
- California
- Illinois
- Indiana
- Michigan
- South Dakota
- Wisconsin
States where the franchisor is registered to sell new franchises (FDD registration filings).
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 12
- Loan volume
- $7.8M
- Median loan
- $770K
- 50th percentile
- Charge-off rate
- 0.0%
- rates vary by category · see methodology
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- N/A
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 5
- Defaults
- 0
- Typical loan rate
- 9.2%
- avg rate to borrowers
- Franchised industry avg
- 10.8%
- brand beats franchise avg ↓
- Jobs supported
- 221
- 2.8 per loan
- Lender concentration
- 58%
- top lender's share
Borrower mix: 92% went to startups / new businesses, 8% to established operators
Franchise vs independent — in limited-service restaurants, franchised businesses charge off at 10.8% vs 10.0% for independents — franchising is associated with 8% higher SBA default risk in this category.
Top lenders financing Potbelly Sandwich Shop franchisees
Showing 3 of 5 lenders. The full breakdown — every lender, state distribution, interest rates & risk ratings — is in the SBA Lending Report below.
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Potbelly Sandwich Shop's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 5 lenders with concentration factor
- Per-state charge-off rates across 4 states
- Startup risk premium and job creation velocity
- 2-year lending trend
Instant access. No subscription.
With a 0.0% charge-off rate across 12 loans, banks have historically viewed this brand favorably for lending.
What could kill this investment?
SBA loans charge off at 0.0% — 100% below the 16.0% national norm, i.e. lower lender-observed risk.
Source: SBA 7(a) FOIA · FDD Items 3, 21
Risk analysis
FranchiseVerdict rating + FDD Items 3, 4, 8, 16, 21
Risk & Legal
Clean: no litigation, no bankruptcy, no going-concern. Positive net worth $7,629,000 and net income $2,217,000, audited with Item 19 disclosed. Strong +71.7% unit growth to 424 units.
Litigation (Item 3)
0 case reference(s): 0 pending, 0 settled.
Bankruptcy (Item 4)
Disclosed in last 7 years
Bankruptcy Code; (b) obtained a discharge of its debts under the bankruptcy Code; or :(c) was a principal officer Of a company or a general partner in a partnership that either filed as a debtor (or has filed against it) a petition to start an action under the U.S. Bankruptcy Code or that obtained a
Audited financials (Item 21)
Yes · Deloitte & Touche LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: Yes
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
Score breakdown · what drove the 88 / 100 verdict
- 01MINORZero litigation, no bankruptcy
- 02MINORNet worth $7.63M, net income $2.22M
- 03MEDAudited, Item 19 disclosed
- 04MINOR+71.7% unit growth
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 9.0% of sales (royalty + ad fund), before rent and labor.
Source: FDD 2024 · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 5 years |
| Allowed renewalsℹ | 2 |
| Territory type | none |
| Protected territory | No |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Right of first refusalℹ | Yes |
| Termination notice | 30 days |
| Termination groundsℹ | 2 |
| Curable defaultsℹ | 3 |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Governing law | Illinois |
| Litigation count | 0 |
View Item 3 litigation summary
0 case reference(s): 0 pending, 0 settled.
Items 10, 11
Training & Operations
- Classroom training
- 4 hrs
- On-the-job training
- 294 hrs
- Training location
- at the shop
- Ongoing training
- Required
- Field support
- 68 hrs/yr
- On-site visits per year
- Site selection
- joint
- POS system
- NCR / Aloha POS
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: NCR / Aloha POS
Item 20 · call current owners
Franchisee Contacts
79 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Potbelly Sandwich Shop · FDD (2024) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Potbelly Sandwich Shop franchise?
The total investment to open a Potbelly Sandwich Shop franchise ranges from $644K – $1.2M, with an initial franchise fee of $40K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Potbelly Sandwich Shop franchise owners earn?
According to Item 19 of the Potbelly Sandwich Shop FDD, the average gross sales per unit is $1.2M. The median is $1.2M. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Item 19 in the Potbelly Sandwich Shop FDD?
The FDD section where a franchisor may disclose financial performance of its outlets. Disclosure is optional and formats vary; figures are typically gross sales, which is revenue before expenses, not profit. FranchiseVerdict extracts these figures directly from the Potbelly Sandwich Shop FDD and qualifies whose outlets they describe.
What is Potbelly Sandwich Shop's franchise failure rate?
Based on SBA 7(a) loan data, Potbelly Sandwich Shop has a charge-off rate of 0.0% across 12 loans, meaning 0.0% of franchise loans were charged off. Charge-off rates are one proxy for franchise risk, though they do not capture all closures. This data comes from FOIA-sourced SBA lending records.
How many Potbelly Sandwich Shop franchise locations are there?
As of their most recent FDD filing, Potbelly Sandwich Shop has 424 total units in the United States, including 79 franchised units and 345 company-owned units. 38 new units were opened in the latest reporting year.
Is Potbelly Sandwich Shop a good franchise to buy?
FranchiseVerdict rates Potbelly Sandwich Shop as a A-grade franchise with a verdict score of 88 out of 100 (higher is better), based on our analysis of investment costs, revenue data, SBA loan performance, and growth trends. Our rating is based solely on publicly available FDD and government data; we recommend speaking with current franchisees before making any investment decision. This is not investment advice.
Data sourced from public FDD filings and SBA 7(a) FOIA records. Not financial advice.
For franchisors
Are you the franchisor?
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Data extracted from public FDD filings and SBA 7(a) loan disclosures (FOIA). This information is provided for research purposes only and does not constitute financial, legal, or investment advice. Verify all figures with the franchisor's current Franchise Disclosure Document before making any investment decision.