Franchise Fee and Initial Investment
If you’re considering opening a Jersey Mike’s restaurant, it’s important to understand the costs involved in the franchise fee and initial investment. The franchise fee is the amount you pay to partner with Jersey Mike’s and operate one of their locations under their brand. The initial investment refers to the total cost of starting your business, which includes the franchise fee, equipment, build-out costs, inventory, marketing, and other expenses.
The franchise fee for Jersey Mike’s is $18,500. This fee is payable upfront and grants you the right to use the Jersey Mike’s name, operating system, and trademarks. In return, you receive support and training from the Jersey Mike’s team, which includes everything from site selection and lease negotiation to on-site training and ongoing marketing support.
The initial investment for opening a Jersey Mike’s restaurant can range from $193,000 to $746,000, depending on the location and size of the restaurant. This investment includes everything from equipment and build-out costs to inventory, marketing, and initial operating expenses. While this may seem like a significant investment, it’s important to keep in mind that the investment includes everything you need to get your business up and running, including support and training from Jersey Mike’s.
It’s worth noting that financing is available for qualified candidates who are interested in opening a Jersey Mike’s franchise. Jersey Mike’s has worked with a number of lenders to offer financing options that can make it easier to obtain the necessary capital to start your business. Additionally, Jersey Mike’s is an approved franchise for the Small Business Administration’s (SBA) loan program, which can allow you to receive favorable financing terms.
When considering the franchise fee and initial investment for opening a Jersey Mike’s restaurant, it’s important to keep in mind the potential for a strong return on investment (ROI). Jersey Mike’s has a strong track record of success, with an average store revenue of $778,834 in 2020, according to their Franchise Disclosure Document (FDD). Additionally, Jersey Mike’s boasts a loyal customer base, with many customers returning to their restaurants time and time again for their fresh, high-quality subs.
In conclusion, opening a Jersey Mike’s restaurant requires a significant investment of time and money. However, the franchise fee and initial investment also provide access to the support and training needed to start and run a successful business under the Jersey Mike’s brand. With the potential for a strong ROI and a loyal customer base, opening a Jersey Mike’s franchise can be a worthwhile investment for those willing to put in the effort required to succeed.
Real Estate Costs for a Jersey Mike’s Location
Real estate costs are an important consideration when opening a Jersey Mike’s location. The cost of real estate can vary significantly depending on the location and size of the property. In general, the cost of real estate for a Jersey Mike’s location will be one of the largest expenses associated with opening a new franchise.
The cost of real estate for a Jersey Mike’s location will depend on a variety of factors, including the location, the size of the property, and the demand for commercial real estate in the area. Some locations may be more expensive than others, depending on the local market conditions. For example, a Jersey Mike’s location in a densely populated urban area may be more expensive than a location in a smaller town or rural area.
When considering the cost of real estate for a Jersey Mike’s location, it is important to factor in a number of other expenses as well. For example, the cost of rent or mortgage payments may be just one part of the total cost of operating a Jersey Mike’s location. Other expenses may include utilities, insurance, taxes, and maintenance costs.
Before selecting a location for a Jersey Mike’s franchise, it is important to do your research and carefully evaluate the local real estate market. This may involve working with a real estate professional who is familiar with the area and can provide guidance on factors such as zoning laws and property values. You may also want to look at trends in the local economy and consumer spending habits to help you make an informed decision.
One way to control the cost of real estate for a Jersey Mike’s location is to consider opening a location in a shared retail space or shopping center. This can help reduce the cost of real estate by allowing you to share the cost of rent or mortgage payments with other businesses. In addition, shared retail spaces may also offer benefits such as increased foot traffic and exposure to potential customers.
In addition to considering the cost of real estate up front, it is important to factor in the cost of ongoing maintenance and repairs. This may include costs such as landscaping, HVAC repairs, and repairs to the building’s exterior. In some cases, it may be necessary to invest in significant upgrades or renovations to the property in order to bring it up to the standards required for a Jersey Mike’s location.
In general, the cost of real estate for a Jersey Mike’s location will depend on a variety of factors, including the location, the size of the property, and the demand for commercial real estate in the area. By carefully evaluating the local real estate market and working with a real estate professional, you can help ensure that you are making a sound investment in your Jersey Mike’s franchise.
Equipment and Supplies Expenses
One of the most significant costs of opening a Jersey Mike’s franchise is the equipment and supplies expenses. Jersey Mike’s uses custom-made ovens, grills, and mixers that are designed specifically for their menu items. The cost of this equipment can range from $100,000 to $150,000 depending on the size of the store. Additionally, Jersey Mike’s also requires the use of specialized software for ordering and tracking inventory. This software can cost between $5,000 and $10,000.
The equipment and supplies expenses do not end there. Jersey Mike’s also requires franchise owners to purchase specific inventory items directly from their suppliers. These supplies include bread, meats, cheeses, and vegetables. The cost of these supplies will vary depending on the location of the store and the demand for specific products. However, initial orders typically range from $15,000 to $20,000, with subsequent orders costing $5,000 to $10,000 per week.
A significant portion of equipment and supplies expenses is also spent on employee uniforms and store signage. Jersey Mike’s has strict guidelines for employee uniforms, which include branded shirts, hats, and aprons. The cost of these uniforms can vary from $2,000 to $5,000 depending on the size of the staff. Similarly, store signage must be purchased directly from Jersey Mike’s corporate office. The cost of this signage can range from $5,000 to $10,000, depending on the complexity of the design and the size of the store.
It is important to note that the equipment and supplies expenses for opening a Jersey Mike’s franchise are significant. However, they are also necessary to ensure that the store is equipped with the necessary tools and resources to provide customers with the high-quality food and service that Jersey Mike’s is known for. Therefore, it is crucial to factor in these expenses when considering the total cost of opening a Jersey Mike’s franchise.
Employee Hiring and Training Expenses
One of the biggest expenses when opening a Jersey Mike’s franchise is the cost of hiring and training employees. This is an essential step to make sure that the food and customer service meet the standards set by the franchisor. The franchisor provides a comprehensive training program for all new franchisees and their employees, which includes a two-week training period at a certified training location.
During the two-week training period, employees learn the basics of food preparation, customer service, maintaining cleanliness, and handling of equipment. As the franchisor provides this training for all employees, it is part of the franchise fee that the franchisee pays. The franchisee is also responsible for paying for the travel and accommodation expenses of their employees during the training period.
When it comes to hiring employees, Jersey Mike’s franchisees can expect to pay various expenses, including advertising for the job positions, screening job applicants, and the actual wages. It is essential to have a well-trained and motivated team to run a successful franchise operation, so it’s crucial to hire the best candidates.
The franchisor provides a recruitment guide that helps franchisees to advertise job positions on various platforms, including the Jersey Mike’s website and on social media. These channels generate substantial traffic, making it easier for franchisees to reach potential employees.
When calculating the total employee hiring expenses, franchisees should consider legal compliance issues, such as the cost of background checks and drug tests. The cost of these tests varies depending on the state and the service provider. Franchisees should also consider the cost of employee uniforms and equipment used in the store.
To ensure that all employees are well-trained and motivated, the franchisee should also consider the cost of employee recognition programs and incentives. These programs not only improve employee satisfaction but also increase employee productivity and customer satisfaction. The cost of employee recognition programs varies depending on the number of employees and the rewards given.
Opening a Jersey Mike’s franchise is a significant investment. However, with proper planning and budgeting for employee hiring and training expenses, franchisees can increase their chances of success. By hiring and training the best employees, franchisees can maintain the high standards set by the franchisor and provide an exceptional customer experience.
Ongoing Operational Costs of a Jersey Mike’s Franchise
Opening a Jersey Mike’s franchise can be a rewarding experience. You will be able to run your own business and serve quality food to people. However, just like any other business, there are ongoing costs that you need to consider in order to keep your franchise up and running. Here are the five main ongoing operational costs of a Jersey Mike’s franchise that you need to know:
1. Royalty Fees
Royalty fees are a percentage of your gross sales that you must pay to Jersey Mike’s corporate every month. This fee covers the use of the brand name, trademarks, and the ongoing support that the company provides. The current royalty fee for a Jersey Mike’s franchise is 6% of your gross sales.
2. Advertising Fees
Advertising fees are paid by all Jersey Mike’s franchisees to fund the company’s national advertising efforts. This fee currently amounts to 4% of your gross sales. Jersey Mike’s uses this money to create and distribute TV ads, social media campaigns, and other marketing materials.
3. Food and Beverage Costs
The cost of food and beverages is another ongoing operational cost of a Jersey Mike’s franchise. The cost of ingredients and supplies can vary depending on location, seasonality, and other factors. However, franchisees are required to purchase supplies directly from Jersey Mike’s approved vendors to maintain quality and consistency.
4. Rent and Utilities
As a franchisee, you will need to rent a space to operate your business. The rent cost varies depending on the location and size of the space. In addition to rent, you will also need to pay for utilities, such as electricity, water, and gas. These ongoing costs can have a significant impact on your bottom line, so it’s important to factor them into your budget.
5. Labor Costs
Lastly, labor costs are an ongoing operational cost to consider. As a franchisee, you will need to hire employees to help run your business. The cost of labor includes salaries, benefits, and payroll taxes. It’s crucial to keep your labor costs in check to maintain profitability. You may need to adjust your staffing levels to meet demand and keep labor costs under control.
Running a Jersey Mike’s franchise can be a profitable venture if you carefully manage your ongoing operational costs. By understanding the five main costs, you can budget effectively and ensure the success of your franchise.