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Why are some Quiznos franchises so cheap?

I know it's a question that you can't really answer, but I've been looking for a Quiznos franchise in the Los Angeles area. In seemingly similar small cities, I've seen franchises ranging from $450K to $35K. Is it all due to location and customer traffic, or are there other issues with some Quiznos franchises that I am not aware of?

Michael Kirkland

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Answers (22)
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May 31, 2017
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Carol's Bistro and Sandwich Shop
Owner/Manager
Tarrant County, TX

There are many reasons to NOT BUY a Quiznos franchise. They recently were purchased by an investment "GROUP", they make franchisees purchase their inventory through a distribution center they own, and over charge franchisees. They do not provide adequate support for their franchisees, and are recently forcing franchisees out of their business to take over and create company owned. Have you stopped to ask why so many are for sale, why so many are out of business? This is just a peek, it is far worse than this....They closed over 100 stores in Texas alone, and need I say more. I use to manage a store and was able to see more than I should have. I would strongly advise against anyone in franchising through Quiznos.

Mar 5, 2013
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how much

Apr 6, 2012
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Just read this:

Area franchise owners settle lawsuit against Quiznos
By Brian Bowling, PITTSBURGH TRIBUNE-REVIEW
Friday, January 6, 2012
Last updated: 6:37 pm
About the writer
Brian Bowling is a Pittsburgh Tribune-Review staff writer and can be reached at 412-325-4301 or via e-mail.

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Three dozen franchise owners in Allegheny, Beaver, Lawrence and Westmoreland counties have apparently settled their racketeering lawsuit against Denver-based Quiznos.

U.S. District Judge Lisa Pupo Lenihan today approved a joint motion to dismiss the case. The motion doesn`t provide details of the settlement. Lawyers for both sides and a company representative couldn`t be reached for comment.

The owners of the local restaurants claimed in a 2008 class-action lawsuit that the company engages in several business practices that generate profits for the company while driving the local franchises into bankruptcy.

In particular, the lawsuit claimed the company issues coupons for free or discounted sandwiches but doesn`t compensate the franchises for the lost revenue, requires franchise owners to buy products they don`t need and from suppliers who can charge high prices because they have exclusive contracts with Quiznos.

The company denied the franchise holders` claims.

Read more: Area franchise owners settle lawsuit against Quiznos - Pittsburgh Tribune-Review http://www.pittsburghlive.com/x/pittsburghtrib/news/breaking/s_775440.html#ixzz1ijadEI8b

Jan 6, 2012
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The BAF Group LLC
MD

Jose, I beg to differ with you. The Company collapsed several years ago and a new entity took it over. The marketing was increased, there were changes in the promotional direction and expansion plans. The problem is probably (and this is a guess,) that the entire plan is potentially faulty. Subway is selling a poor product at rock bottom prices to kids; would more upscale people really pay 30% more for a sub sandwich? Quiznos position themselves in many business-oriented traffic flows, trying to reach out to white collar lunch people, but when you really get down to it, it is an overpriced sub! So, the new entity probably has declined in its ability to reach into its own pockets, has not gotten the increase in royalties it anticipated, and now it is in the same old rut that eroded the past ownership.

If you speak to past owners, you will find that the original change was welcome and they felt very positive about it. There were substantial changes, at that time. But that has not been maintained. You are not wrong in your observences of what is operational a problem with what you saw. But knowing the entire history is key to understanding why the Company is probably heading down in flames.

Dec 16, 2011
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DON, I think that their way of doing business has not changed. They want to be successful, but it is wrong business practice. I have talked to other owners and interested owners and they say the same thing. They are tryng to ignore the past and don't want to answer why they have failed. Commercials are very minimal on the company so the questions is where is all of your advertiment investment money going? Another thing is the cost of store materials. They are making owners purchase basic utilities at a very high cost. The only positive about Quiznos is the new restaurant model they have comming up in 2012. However, for me it is very risky investment people have lost confidence in their product.

Dec 16, 2011
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Stearns Bank
Business Development
MN

We did a lot of SBA loans for Quizno's a few years ago, when the total amount needed to open one was a little lower and let's just say it didn't work out too well. All the Subway deals we did worked out great with an almost 0% failure rate but for some reason the Quizno's model/franchise just failed again and again with all different types of owners. So as some of you have said, it has to be the corporate training and structure.

Dec 15, 2011
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The BAF Group LLC
MD

Jose, would you believe they were even worse, about three years ago?

Dec 14, 2011
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They donot know how to sell their product. I attended a seminar and the guys that do the presentation the heavy set big man that thinks he know business does not know how to sell the product. His whole presentation was a buch of videos that really sucked. It was a bunch of testimonials, which to me don't me anyhting. Having talked to this un educated man personally (who knows nothing about the business), the man got upset with the question that I was asking. He did not know how to respond in a professinal manner. He would always answer in circles. He could have at least sounded trustworthy. Now I know why this company is not sucessful and probably will never be. They cannot and never will compete with subway. To conclude I will never, ever put my money in this company. They do not know what the hell they are doing.

Dec 14, 2011
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We invested about $250K, after 2 years closed the door and continued paying our monthly rent of about $1500. It was cheaper to close and pay rent (3 years to go on rent contract) than to keep it running. Luckily some fool thought he could make a go of it. We sold it to him for $40K, he lasted a year and closed and also found out it was cheaper to pay rent than to keep it open. A 3rd fool bought it from him, he also closed. Now Quiznos came in and opened it as a corporate store. They have only been open a few months. May be they will see why it does not work and it is cheaper to close and pay rent that to keep it running. At least now they will be sticking it to themselves. If you are thinking of buying a Quiznos, give your money away, you will feel better and have less hassles.

Dec 13, 2010
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They would only be cheap if someone GAVE you $500,000 to take one

Dec 1, 2010
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They are an awful franchise to own. They nickel and dime people to death, they continue to lower their prices the franchisee can sell for but raise the price of the food. Watching a friend suffer with a quiznos franchise has turned me off to the whole idea of any kind of franchise. They have too much control over you.

Oct 5, 2010
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Let me give you a quick answer: you will likely go bankrupt after a few years of operating a Quiznos store.

My friend and I bought a store in late 2006 for $175K. With other fees and extra costs, the final cost came to $210. A few months into opearation, I realized the couple who sold the store to us only made money because they both worked from 9am to 10pm every day, 7 days per week, all year round (except 3 or 4 major holidays), that's 182 hours of work per week for both of them. And how much did they earn? Base on their last anual financial statement, they earned about $43K a year. If you make a quick calculation, you see that they earned about $4 or $5 for every hour of their work, and that's with an investment of almost $300,000 (they built the store for that much money).

But that was even better than what my friend and I made. For the whole year of 2007, each of us worked 40 hours/week and didn't see a dime of profit. For the first 6 months our sales were between $7000 an $8000 per week, that's about the same as what the previous store owner's sales. Then in the summer of 2007 it was down to $6000-$7000 and never bounced back, despite a lot of efforts from us. But we were not a lone, almost every store in our region suffered, and I figured out that was national trend for Quiznos.

At the end of 2007 I left the store for my partner to run it alone, losing all of my share. She ran it for another two years, hoping to turn it around. After losing much of her savings, she finally sold it in early 2010 for $50,000. By this time, most of the stores in my surrouding area have been closed (about 5 of them).

Between 2007 and 2009, there were about 1000 stores in the US went out of business (out of the total of 4600 stores in early 2007).

So don't be surprised when a Quiznos store is sold for $50K or less, even though the cost of building a new one is almost $300K. I have seen stores that were sold for less than $20K.

Henry Vuong
Ex-Quiznos Franchisee
Corona, CA

Sep 6, 2010
Joseph DiBello
Vested Business Brokers
Career Development Officer/Broker
Suffolk County, NY

I have several for sale

Aug 12, 2010
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Biz2Credit LLC
New York County, NY

Michael,

Biz2Credit (www.biz2credit.com) has financed Quiznos and Subways. We have seen that Quiznos are more expensive to operate than a Subway. The former requires 2 times more no. of people to prepare a sandwich than the latter and franchisee fees have been higher.

Subway has introduced breakfast specials also thus bringing in more customers and has a superior marketing machinery.

Aug 6, 2010
Julie A. Barnes, CPA
Small Business Exchange, Inc.
Travis County, TX

Hey Michael,

To find out more about how franchisees feel about Quizno's - visit: http://BlueMauMau.org. For free advice about how to buy, sell, or evaluate a business, please visit my blog: http://AustinBusinessesForSaleBlog.com (despite the address, this blog is not just dedicated to Austin).

Good Luck!
Thanks
Julie A. Barnes, CPa
President, SBX, Inc.

Aug 5, 2010
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I think the easy answer is, they are not good......a bit expensive, if they get a line, it takes longer than subway.....but basically my biggest problem with quiznos has always been, order a sub, say turkey and ham...the run it thought the grill........top piece of meat warm, bottom pieces of meat cold.....its that simple...its a warm cold sub.......nasty.....heat it or dont......what if your hamburger came like that at burger king....you would throw it up....EVERY TIME I TRY A STEAK SUB THERE, ALL FAT....I ASKED LAST TIME TO PUT JALEPENOS ON THE SUB, IT WAS TO GO. THEY SAID NO, USE THE BAR, EVEN THOUGH THEY HAD SOME RIGHT THERE......

Aug 5, 2010
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Probably because so many are closing up!!Try a deli and/or diner. It's hard work, but good rewards and fun. Plus in the right area it is an excellent investment that will grow. And you can do this anywhere there are people. We doesn't like to eat great food? Also, have 2 possible locations in Florida under a different name that may be available together or separate.

Nov 8, 2009
Fayaz Karim, MBA, CA
Subway Valuations, Business Searches
Consultant
Orange County, CA

The general perception of value is low in the market, so prices are depressed and supply is high with a low demand, so they languish on the market.
But there are deals to be had out there if you buy t the right price ad structure your deal in the best way.

Fayaz Karim , www.mfranchiseman.com

Aug 21, 2009
Michael Kirkland
Los Angeles County, CA

Great responses. I figured something like that must be going on with Quiznos franchises. Thanks for your input.

Jul 29, 2009
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Quiznos are better now than they were a few years ago but they still have a ways to go. When we were looking to buy a business in 2005/06 we looked at Quiznos. The research we did proved to us they were not a viable option to us.
At the time their problems were many. Franchise reps would sell to anyone who had 25k for the franchise fee. That led to a lot of problems. One was that too many Quiznos popped up way too fast and way too close to each other-- believe it or not they had no territorial restrictions (at least back then) so owners faced competing against other Quiznos that would open very close to them. The second problem with giving away franchises is that most of these people were used to working 40 hrs a week and had no idea what the restaurant biz was like. People got disenchanted soon after buying in.
Other problems were the vendors they were using were charging franchisees way too much for product they could get elsewhere for much cheaper.
Most Quiznos were not making any money at the time and the market was soon flooded with underperforming Quiznos that had no business being open in the first place. At one point in the Pittsburgh area there were 15 Quiznos for sale on this site alone! The broker I bought my place off of had six listed them at once and couldn't sell any of them.
Lawsuits from franchisee against Quiznos were flooding the courts.
I understand that Quiznos today are much better but I would still be wary of them.
A Quiznos owner said in 2005, "It's embarassing-- I work all these hours and spent a ton of money on the place and I make 300 a week."

Jul 28, 2009
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United Business Brokers
Maricopa County, AZ

short answer: Quiznos aren't typically good businesses to buy. Their economics are poor. The franchisor typically opens another location in your backyard if you show any signs of being successful; they run marketing campaigns that put the franchisees out of business, etc.

Jul 28, 2009

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