Why is it bad to invest in a Subway franchise?

[telstar]

Hello Folks,

I am a newbie, so please bear with me, if my questions doesn't make much sense! I am not a business man!

Covid era aside(i'll come back to this), I am trying to get into business, primarily because my other half is a housewife and she has lots of time in her hands and I have little bit to spare to help her starting a new business. When she first came to UK, she worked in a Subway and she loved the "framework" that Subway provides that makes it so easy to run it. Both of us, as a first venture, want to run a Subway franchise, may be not immediately due to covid but in coming times(assuming it will be over OR we all will get used to it, living with it will be a second nature).

I did some research and many a times I have heard negatives reviews about it, mainly around the fact that profits have shrunk, you need many Subways to make some decent living! You cannot survive on running single subway... it won't pay the bills etc.

Point taken, however, we are fortunate enough to be living decent life on whatever we are earning, this is purely for utilising "free" time that my other half has and trying to make some money as well!

For us, generating revenue of £2k per month is a good start! I have estimated figure of how much i'll have to invest.

I know for a fact that people are, generally, "bored", "tired" of subway (even then they, kind of love visiting it).

My question to you is:
1. Why do I hear negative feedback from investors about subway? Is it because that they have so many businesses that they want to squeeze every penny from every investment and Subway doesn't cut it?

2. Are there any other opportunities, that are as streamlined as Subway for "new" business owners? without spending £Million ex: McDonald's

3. Is it okay to start Subway franchisee, considering expectations of £1,500 to £2,000 per month net profit?

Sorry, for long post! Looking forward to hear from experts!

Thank you so much!

Be safe! Have a good time!

 

[Scalloway]

Are sandwich shops a good investment just now with so many people working from home?

 

[ecommerce84]

I went into a Subway for the first time in years on Saturday for some breakfast but only because it was the only thing open. I won’t be back in a hurry.

There are a few reasons I wouldn’t want to invest any money in one:
1. You’re right that people are bored with it, and I don’t see that changing anytime soon.
2. It’s not something to do in your free time but instead it will take up all of your time - the one I was in was open 7am - 11pm 7 days a week. Even if you employ staff, they still need managing
3. Most importantly - all the good locations are gone. They must be as they have been around for so long and there are so many of them. There will be very few opportunities for new branches in good locations as we are unlikely to see many new shopping centres or service stations. And those opportunities that do arise will fall to existing franchise holders. City centre locations will be struggling with lack of shoppers and workers.

If you are genuinely looking for something just to fill your free time with some earning potential, I’d look at street food of some kind. It’s huge right now, helped a lot by social media as a good photo of something incredible looking will sell.

With what I do, I trade alongside many and the good ones do very well at food festivals and food markets. There is also the possibility of wedding and event catering as well as delivery (lots have done well over lockdown with this).

On top of this you can work the hours you want, set the menu how you want and put on specials etc how you want.

You mention your wife Is from outside of the UK. Where is she from? Many of the street food vendors I know specialise in food from their home nation and use that as a selling point. At one market I’m sited next to a Cambodian couple and the food is incredible.

 

[Maxwell83]

What Franchise has the minimum investment required for a Subway setup as £85k.

https://www.what-franchise.com/franchise-opportunities/fast-food-franchises/subway

For me, putting in £85k and working my balls off 7 days a week for £1,500 - £2,000 net profit just doesn't cut it. Too much of my time AND my money required for that. I would be prepared to put in time without money, or money without time for that sort of return, but not both.

The slightest change in the wind can see £1,500 become £700 net profit or even £0 net profit. If £1,500, there is not enough margin for error in those sorts of numbers.

 

[Mark T Jones]

Your post reveals that you don’t understand food retail. Like most businesses, it’s all about having a clear focus on your target customer and positioning yourself (literally and metaphorically) in their line of vision

in the case of Subway, that was historically students - and it still is a good to’ brand in student communities. Unfortunately the availability of suitable sites in student-rich areas didn’t meet their desire for growth, so they lowered the bar and let franchises open wherever they liked. Hence the high failure rate

find a good location in a student area and run it well, you will prosper. Open anywhere else, you will be just another sandwich shop.

 

[PugwashEQ]

Lots of great advice already here.

There is nothing wrong with a subway franchise per se, but there are probably better options! (FWIW i built a chain of 8 fish and chip shops- the first shop cost £95k to setup, and when we sold it;s turnover was just over £1m/yr.)

Normally when you buy a franchise you do so for a number of distinct reasons:
1. You get access to skills and training you can't get elsewhere
2. You get access to a customer base that you can't otherwise get to
3. You access know how and branding that you can't otherwise leverage
3. (frequently) You get get some sort of geographic or other protection from the franchisor.

The difficulty with SubWay is that the barriers to entry to a sandiwch chain are very low (really what skills do you need to make sandwiches- not that many... even finding the suppliers is easy- Brakes would do almost all of it for example), so you aren't buying know how from them. I would suggest (although subway would disagree) that people want sandwiches ahead of a subway (ie they won't travel past other sandwich shops just to get a subway), but perhaps the biggest issue is that there is no geographic protection from subway.

They one thing they do do is give you brand identity and national advertising.

For me, the costs and returns in aggregate don't make sense.

Running a food business is hard work to make succesful- 100 hour weeks for the first couple of years is probably right as you can't cut corners (having a repeatable product is THE most important thing in fast food production.....) so you do want to make more than a grand or two per month. You can't do a food business part time. If you want part time you need to find something else.

MacDonalds doesn't take millions, they are currently recruiting people on the basis that you have £100k of free cash- have a google as i can't post links yet- sorry!

having seen how Macdonalds runs its processes, if i was going back into food and wasn't starting my own chain of businesses, i'd start a Macdonalds Restaurant they are phenomenally well organised as long as you follow their processes!

 

[Mark T Jones]

Lots of great advice already here.

There is nothing wrong with a subway franchise per se, but there are probably better options! (FWIW i built a chain of 8 fish and chip shops- the first shop cost £95k to setup, and when we sold it;s turnover was just over £1m/yr.)

Normally when you buy a franchise you do so for a number of distinct reasons:
1. You get access to skills and training you can't get elsewhere
2. You get access to a customer base that you can't otherwise get to
3. You access know how and branding that you can't otherwise leverage
3. (frequently) You get get some sort of geographic or other protection from the franchisor.

The difficulty with SubWay is that the barriers to entry to a sandiwch chain are very low (really what skills do you need to make sandwiches- not that many... even finding the suppliers is easy- Brakes would do almost all of it for example), so you aren't buying know how from them. I would suggest (although subway would disagree) that people want sandwiches ahead of a subway (ie they won't travel past other sandwich shops just to get a subway), but perhaps the biggest issue is that there is no geographic protection from subway.

They one thing they do do is give you brand identity and national advertising.

For me, the costs and returns in aggregate don't make sense.

Running a food business is hard work to make succesful- 100 hour weeks for the first couple of years is probably right as you can't cut corners (having a repeatable product is THE most important thing in fast food production.....) so you do want to make more than a grand or two per month. You can't do a food business part time. If you want part time you need to find something else.

MacDonalds doesn't take millions, they are currently recruiting people on the basis that you have £100k of free cash- have a google as i can't post links yet- sorry!

having seen how Macdonalds runs its processes, if i was going back into food and wasn't starting my own chain of businesses, i'd start a Macdonalds Restaurant they are phenomenally well organised as long as you follow their processes!

This is fantastic oversight!

One intesresting anomaly I see on franchises is that many oponents don't like them because they want to build their own brand, or 'do things their own way'

Meanwhile, the most common causes of failure in independents is abysmal marketing (in all its forms) and and poor processes - usually involving the owners being responsible for everything.

 

[MikeNewEra]

If its not next to a train station, bus hub, underground, tram, uni, gym or part of a petrol station = no point. You will barely turn over £1k a day.

Minus all your over heads. You will be left with £100 per day avg.

Maxwell83 is correct I would not invest £85k to work like a dog 7 days a week and to be only left with £2.5k avg per month.

Rather invest in a coffee stall near or in a train station. Its a cheaper start up, can be managed easily with one employee and over heads are low. You will make the same amount of money and have less of a headache.

General rule of thumb for me when it comes to fast food retail. If I can't see it taking £3k a day, I'm not interested. Restaurants have to take at least double that per day £6k-£8k (on a weekday).

 

[Mr D]

Perhaps instead start a food business without going via a franchise?

Or indeed a different business.

Figure out what is wanted. Figure out what time should be spent on it, what income is being looked for, what skills are available or can be learnt.

Then figure out what business can be done.

Have used subway a couple of times, not by choice but by the fact they were the only place close by.
Any other place selling food and not having long wait was better.


Long hours business is not for the faint hearted. There is no requirement to earn minimum wage, indeed as has been mentioned you could end up working 18 hour days 7 days a week for zero income.
And if become ill then someone else has to do the work. And be paid whether the business makes money or not.
A business closed even for one day due to illness can lose customers.

 

[Paul Norman]

If you can get a prime site, you will make a lot more than £2k a month.

If you can't, you will be more likely to loose money on what is not the current trendy gig. It is vulnerable, as a business, and the swing from £2k profit to £8k loss could happen very quickly.

It will certainly be a full time thing, running it. By full time I mean 12 hours a day, 7 days a week.

 

[Strontium Dog]

I've often thought a barbers would be fairly good part time earnings. Small empty unit fairly cheap to kit out and just get a couple of girls in who've been on the local college course. Stay below the VAT limit. Fairly easy to recruit new staff if one leaves. £7 - £10 a pop depending on where you are based. don't need many walk in cuts per day before you are in profit.

 

[Ian J]

find a good location in a student area and run it well, you will prosper. Open anywhere else, you will be just another sandwich shop.

One might as well save the £85,000 franchise fee and open one of your "just another sandwich shops" and spend a small part of the money that you have saved on your own branding

 

[Darren_Ssc]

I've often thought a barbers would be fairly good part time earnings. Small empty unit fairly cheap to kit out and just get a couple of girls in who've been on the local college course. Stay below the VAT limit. Fairly easy to recruit new staff if one leaves. £7 - £10 a pop depending on where you are based. don't need many walk in cuts per day before you are in profit.

I'd have a chat with a few established barbers before investing in such a business atm.

 

[billybob99]

I've often thought a barbers would be fairly good part time earnings. Small empty unit fairly cheap to kit out and just get a couple of girls in who've been on the local college course. Stay below the VAT limit. Fairly easy to recruit new staff if one leaves. £7 - £10 a pop depending on where you are based. don't need many walk in cuts per day before you are in profit.

It would be even more profitable if you only offered buzz cuts, just need a clipper (sanitiser for all that good cleaning).

Don't even need a unit, just a long extension cord, just turn a wheelie bin upside down and plop them on there, outside.

When its done, mother nature will take the hair away.

 

[Mr D]

I've often thought a barbers would be fairly good part time earnings. Small empty unit fairly cheap to kit out and just get a couple of girls in who've been on the local college course. Stay below the VAT limit. Fairly easy to recruit new staff if one leaves. £7 - £10 a pop depending on where you are based. don't need many walk in cuts per day before you are in profit.

So if say 3 or 4 walk ins a day .... and paying a couple of staff. Plus needing income yourself.

It appears barbers are having a few problems, what with covid. As are to some extent hairdressers too.
February my local hairdressers was pretty busy, always people in there. Haven't seen them with a customer in a couple of weeks.

 

[SillyBill]

You'd have to be unemployable surely to think this is a good deal? Buying yourself a £20k job for £85k with all the risk attached, no life and a boat load of stress? Where do I sign up?

 

[telstar]

Thank you everyone for your responses! I am thrilled, to say the least, at looking at the responses, thank you! I was not expecting much response when I first wrote this question, great forum!

I have to say that I have got some invaluable feedback, as I said in my post, I am not a businessman!

All I am trying to do is:

1. My better half is a housewife, who is itching to work
2. I have saved up few pennies!
3. ...and I am trying to help her

I have taken your point onboard about spending £85k and earning mere £1500 £2000 p.m. (net profit).

Reason why I am glad that I posted in this forum is that you as "experts" have opened new doors! You have got me thinking about other opportunities, thank you for that!

(You all have put the final nail in the coffin as far as Subway is concerned)

Thank you!
Stay Safe - Second round of covid is coming! Hope not!

 

[Karimbo]

Telstar (OP), your problem is subway is all you know. You're not seeing £2K profit a month (is that wages per month?) as a bad thing. To put 85K investment into something that will give you below average wage is a terrible thing.

You need to research more and come up with a better business idea. It may be the case that you're just not business minded and you want the security of a job but want to be your own boss. I think there are a million things I'd rather do than operate a subways. If I didn't have the technical skills to research, market and sell products online I would learn a trade, be a brickkie, electrician, carpenter, get myself a £40K-£50K job and get more job satisfaction than any business owner or office worker.

Don't run into subway because that's all you know.

If all I ever wanted to do was to earn 2K a month profit, I would be a taxi driver for a living. Far less stress, very flexible job.

 

[telstar]

Telstar (OP), your problem is subway is all you know. You're not seeing £2K profit a month (is that wages per month?) as a bad thing. To put 85K investment into something that will give you below average wage is a terrible thing.

You need to research more and come up with a better business idea. It may be the case that you're just not business minded and you want the security of a job but want to be your own boss. I think there are a million things I'd rather do than operate a subways. If I didn't have the technical skills to research, market and sell products online I would learn a trade, be a brickkie, electrician, carpenter, get myself a £40K-£50K job and get more job satisfaction than any business owner or office worker.

Don't run into subway because that's all you know.

If all I ever wanted to do was to earn 2K a month profit, I would be a taxi driver for a living. Far less stress, very flexible job.

You are right. Thank you!

 

[telstar]

Thanks again everyone!

 

[Mark T Jones]

One might as well save the £85,000 franchise fee and open one of your "just another sandwich shops" and spend a small part of the money that you have saved on your own branding

50/50%

As we often see, 'marketing budget' can often just be a different black hole.

 

[locutus]

Honestly, don't open a Subway. They are not worth it. There are so many Subway stores that compete against each other in the same area. Opening a new Subway is not going to cost £80k, it will more than likely be double. This excludes your property costs.

You need multiple Subways to make money. Subway even says that on their website (not in so many words)! If you're a one-man-band or a one-woman-band, the £20k a year as profit is ok, especially if your other half has a good job. But, £20k a year in profit, for your own business isn't worth it. Go work at a Subway, and you will earn as much as your boss... If you work as an employee, you get the same money as the store owner, but you don't have the same headache as being the owner. You get to go home when your shift is over. The owner doesn't get to go home after their shift is over.

There is a guy on YouTube who specialises in franchise brokering, and he talks about why you shouldn't buy a Subway:

 

[NEW SUB MASTER]

Hello everyone,

I did go through a lots of forum reviews on Subway Franchise as I am interested to buy one.

I need your respected opinions on numbers as they are not showing even 1,5-2 K per month, almost all in negative, and this is stopping me from this idea.

I want to see, where it could be an arror in the numbers provided to me or "a hidden income???", a big question.

Here is the real life example of the store.

The store I am intereted in Jan 2020 did the following:

+ Total sales - 10 400.00

- VAT - £1 456.00
- Royalties (12.5%) - £1 118.00
- Food cost (26%) - £2 704.00
- Labour (owner + 2 part timers) - £4 000.00
- Utilities (8.5%) - £884.00
- Business rate - £500.00
- Rent - £2000.00

Left with - £2262.00 (negative balance).
- Corporation Tax (20%).
- Income Tax and NI (12.5%).

Jan, Feb, Mar, Apr, May, Oct, Nov, Dec are also in Negative.

The numbers are going into Positive only in June, July, August and September.

If I have to keep company balance in positive then as owner I have to draw only 1500 to make company account in "0.00" and that 1 500 is deffinitely would not be enough to pay my Borrowings, Staff pay and my own living cost.

Deffinitely, the numbers should be wrong, otherwise, how all Subway owners survive....

Thank you in advance for all you comments.

Kind Regards

 

[mattk]

Here is the real life example of the store.

The store I am intereted in Jan 2020 did the following

Why are you interested in a store which is losing £2k a month?

 

[Lucan Unlordly]

There are 7 Subways in our town.
Of the successful ones opened on out of town parades of shops where there is plenty of competition - Chinese Takeaway, Fish & Chip shop, Kebab/Grill, Greggs, Supermarket, Confectioners/Newsagents - they are said to be part of a group of shops that includes the prime town centre franchises.

One chap I know who couldn't make the franchise work said that the bargaining power of Subway helped secure a great deal on the lease but that the expected footfall didn't materialise. They had banked on the other takeaways being shut mornings and afternoons which they did but parking issues reduced potential 'schooltime' trade.

 

[Mr D]

Hello everyone,

I did go through a lots of forum reviews on Subway Franchise as I am interested to buy one.

I need your respected opinions on numbers as they are not showing even 1,5-2 K per month, almost all in negative, and this is stopping me from this idea.

I want to see, where it could be an arror in the numbers provided to me or "a hidden income???", a big question.

Here is the real life example of the store.

The store I am intereted in Jan 2020 did the following:

+ Total sales - 10 400.00

- VAT - £1 456.00
- Royalties (12.5%) - £1 118.00
- Food cost (26%) - £2 704.00
- Labour (owner + 2 part timers) - £4 000.00
- Utilities (8.5%) - £884.00
- Business rate - £500.00
- Rent - £2000.00

Left with - £2262.00 (negative balance).
- Corporation Tax (20%).
- Income Tax and NI (12.5%).

Jan, Feb, Mar, Apr, May, Oct, Nov, Dec are also in Negative.

The numbers are going into Positive only in June, July, August and September.

If I have to keep company balance in positive then as owner I have to draw only 1500 to make company account in "0.00" and that 1 500 is deffinitely would not be enough to pay my Borrowings, Staff pay and my own living cost.

Deffinitely, the numbers should be wrong, otherwise, how all Subway owners survive....

Thank you in advance for all you comments.

Kind Regards

4k in a month in wages? Is that high?

Negative balance - so forget corporation tax, not relevant. Income tax and NI form part of wages bill.

I'd wait until a year or two of positive numbers are showing. Negative numbers now - will they be negative numbers overall later on?

We may never end up with people out and about as much as in 2019. Working from home, businesses finding they don't need high rent places and so on.

 

[Mr D]

There are 7 Subways in our town.
Of the successful ones opened on out of town parades of shops where there is plenty of competition - Chinese Takeaway, Fish & Chip shop, Kebab/Grill, Greggs, Supermarket, Confectioners/Newsagents - they are said to be part of a group of shops that includes the prime town centre franchises.

One chap I know who couldn't make the franchise work said that the bargaining power of Subway helped secure a great deal on the lease but that the expected footfall didn't materialise. They had banked on the other takeaways being shut mornings and afternoons which they did but parking issues reduced potential 'schooltime' trade.

Even great footfall areas don't work if the shop cannot get customers in the door.

In my nearby town is a sandwich place, every year or two it goes under then someone else starts up a sandwich place in the shop again and tries to make it work.
Lots of passing trade. Lots of lunchtime trade and early morning trade. Just not enough to cover the staff and all the costs.

The only business type ever seen in that unit is sandwich shop, in 20 years its never been anything else. Just around a dozen different shops.

 

[NEW SUB MASTER]

4k in a month in wages? Is that high?

Negative balance - so forget corporation tax, not relevant. Income tax and NI form part of wages bill.

I'd wait until a year or two of positive numbers are showing. Negative numbers now - will they be negative numbers overall later on?

We may never end up with people out and about as much as in 2019. Working from home, businesses finding they don't need high rent places and so on.

__________

Thank you for your feedback,

Yes, 4K a wages (as franchisee says 3K for him and 1000 min for part timers)

Owner mention about the sales growth. I think this is only because of customer restricted choice of opened places during Covid. When Covid finished the sales will come down to its normal, lower.

Jan 20. sales £10400, balance left after all payments -2262 (negative)
Feb 20. sales £9749, balance left -2527(negative)
Mar 20. sales 6560, balance left -3826(negative)
Apr. sales 12000, balance left -1610(negative)
May 20. sales 14000, balance left-795(negative)
Jun 20. sales 27350, balance left+4645
Jul 20. sales 22117, balance left +2512
Aug 20. sales 25042, balance left+3704
Sep 20. sales 17016, balance left+434
Oct 20. sales 14357, balance left-649(negative)
Nov 20. sales 13194, balance left-1123(negative)
Dec 20. sales 13741, balance left-900(negative)

Total annual sales 185528, left after all payments - 2397 in negative.

 

[NEW SUB MASTER]

Why are you interested in a store which is losing £2k a month?

I want to buy Subway and become successful franchisee, and I found one to buy in good location and positioning and negotioating the reasonable cost.

But, I can not buy if it is goin to loose the money every month. The predicument is, I can not believe that a single store making or surviving on this numbers.

If business model is 1 shop to loose and money and multi-shop to gain, its a different game and investment.

 

[ImranR]

Hers my semi useful input as I haven't read the thread in full other than the original post.

The subway near my former workplace (pre covid) suffered significant losses due to the change in VAT rules. I don't think covid helped either.

 

[Mr D]

I want to buy Subway and become successful franchisee, and I found one to buy in good location and positioning and negotioating the reasonable cost.

But, I can not buy if it is goin to loose the money every month. The predicument is, I can not believe that a single store making or surviving on this numbers.

If business model is 1 shop to loose and money and multi-shop to gain, its a different game and investment.

Would expect a business to have some sort of cushion to start with anyway.
But yes, long term then continued losses shuts a business.

 

[mattk]

I want to buy Subway and become successful franchisee, and I found one to buy in good location and positioning and negotioating the reasonable cost.

But, I can not buy if it is goin to loose the money every month. The predicument is, I can not believe that a single store making or surviving on this numbers.

If business model is 1 shop to loose and money and multi-shop to gain, its a different game and investment.

There is a reason it is for sale, the losses. If it was making money it either wouldn't be for sale or would cost a lot more.

Unless you have a lot of experience turning round unprofitable businesses and/or running successful fast food outlets, I'd give it a wide berth.

 

[NEW SUB MASTER]

There is a reason it is for sale, the losses. If it was making money it either wouldn't be for sale or would cost a lot more.

Unless you have a lot of experience turning round unprofitable businesses and/or running successful fast food outlets, I'd give it a wide berth.

________
thank you very much, common sence says the same. Why it is on sale! But, it is all personal and stories from the owner.

This is the case when, I want to buy an existing and established shop so I do not have to invest huge money.

Yes, as it saids in many forums to become "you own boss" or "like a store manager", but I wanted to start from this with my wife and grown up daughters.

It is in deed well known brand that everyone trust. I dont want to create my own sandwich shop, I know it cheaper. I want to rely on the well known name.

Plus, it is in good, high street location.

And effordable purchasing cost that i am in negotioation.

But, I stoped now as I can see the real numbers and numbers are in negative.
This is genuinely, puts me off from this purchase.

Here, I wanted to confirm my genuine thoughts with you all, respected people, who might come to know similar cases.

Just to help to make my final decision.

Thank you

 

[NEW SUB MASTER]

Hers my semi useful input as I haven't read the thread in full other than the original post.

The subway near my former workplace (pre covid) suffered significant losses due to the change in VAT rules. I don't think covid helped either.

______
Covid is helping takeaways and this inculing the Subway is it is open and start using delivery services.

Because of covid and customers restrictions on restaurant and food places choice, they are at some point ordring Subway too.

Subway owner is showing the numbers from last year Jan 2600 and this Jan 21 is 2870. I this this is because of Covid too and when Covid finishes and all places are back to normal, Subway will left to its own traditional customers - students.

Thay pay currently only 5% VAT, but if I buy know I need to do all my calculations as in normal situation 20%.

 

[mattk]

Have you asked the owner why it is making losses and what steps he has taken to turn it around? Are there things you can do (longer opening, promotions, marketing etc.) to boost sales that the current owner isn't doing?

 

[NEW SUB MASTER]

Have you asked the owner why it is making losses and what steps he has taken to turn it around? Are there things you can do (longer opening, promotions, marketing etc.) to boost sales that the current owner isn't doing?

_________

Yes, indeed, I asked all these questions. How come he has a business with this numbers?

One thing when owner is claiming the business is good for him and he is comfortable with the current situation and want to sell for personal reasons. The store only operates from 10 am - 6 pm.

Why he already did not expand the opening hours from as eraly 8 till 9 pm? This is to my understanding no point as high street footfall from 10 to 6 pm and no point for him to open othwerwise.

No leafletting done as he is happy / never thought about it.

 

[Mr D]

_________

Yes, indeed, I asked all these questions. How come he has a business with this numbers?

One thing when owner is claiming the business is good for him and he is comfortable with the current situation and want to sell for personal reasons. The store only operates from 10 am - 6 pm.

Why he already did not expand the opening hours from as eraly 8 till 9 pm? This is to my understanding no point as high street footfall from 10 to 6 pm and no point for him to open othwerwise.

No leafletting done as he is happy / never thought about it.

Comfortable with losses?

Dunno about anyone else but I find that unlikely.
If he doesn't sell - and to be honest many businesses for sale do not sell - then he runs at a loss forever...?

 

[Scottishgifts4u]

Am I missing something ?
There is a negative balance of nearly £3k but don’t forget that’s including the £36k in wages he’s taking out for himself.

It’s not a great wage but not to be sneezed at either.

 

[Mark T Jones]

I haven't analysed the figures for the simple reason to make any sense of them would require a minimum 3 year spread backed by bank statements and tax returns

Another thing I would look at closely is how active the owner's involvement is - and how that corresponds to what you plan to do.

You say that Subway is a 'trusted brand'. I'd say it is a brand that has appealed largely to student populations, and has been strategically placed in service stations. The adult population is largely indifferent to it.

My final note of caution - it is the vendor's job to sell the opportunity. Your job is is coolly and impartially evaluate the facts.

 

[NEW SUB MASTER]

Thank you all for valuable thoughts.