What is the amount of the initial franchise fee for a Potbelly Sandwich Works franchise?
Potbelly_Sandwich_Works Franchise · 2025 FDDAnswer from 2025 FDD Document
f the Franchise Agreement is deleted in its entirety.
- Initial Franchise Fee. Section 3.A of the Franchise Agreement is deleted in its entirety and is replaced with the following:
A. INITIAL FRANCHISE FEE.
You agree to pay us a nonrecurring and, except as specifically provided in this Agreement, nonrefundable initial franchise fee of Twenty-Five Thousand Dollars ($25,000). This fee must be paid, and is fully earned by us, when you sign this Agreement. We will credit toward the initial franchise fee any deposit you previously paid u
Source: Item 22 — CONTRACTS (FDD page 79)
What This Means (2025 FDD)
According to Potbelly Sandwich Works's 2025 Franchise Disclosure Document, the initial franchise fee is $25,000. This fee is nonrecurring and, except as specifically provided in the agreement, is nonrefundable. The fee is considered fully earned by Potbelly Sandwich Works once the Franchise Agreement is signed.
Notably, Potbelly Sandwich Works will credit any deposit previously paid under a Shop Development Area Agreement towards this initial franchise fee, if applicable. This means that if a prospective franchisee has already invested in a development area, that initial investment will reduce the amount due for the franchise fee.
In the event of a franchise transfer, the transfer fee is calculated as a percentage of the then-current initial franchise fee. Specifically, it is 50% if the transferee is not an existing Potbelly Shop franchisee, and 20% if the transferee is an existing franchisee. This highlights the importance of understanding the current fee structure, as it impacts potential transfer costs. Also, one-half of the transfer fee is due when the transfer is requested and is non-refundable, regardless of whether the transfer occurs.