Franchisees Make Lots of Bread at Planet Sub
by Ed Teixeira
Recently, I had the opportunity to speak with Sean Kelly, the co-founder of
Planet Sub, and I came away totally impressed. The following article will help
you learn how this franchise combines an exciting food concept with an equitable
opportunity for franchisees.
Sean Kelly and Jeff Klusman opened their first
Planet Sub franchise in 1998 in
their hometown of Kansas City, Missouri. Their sandwiches had become a
tradition in Kansas City and they made the decision to share their exciting menu
throughout the Midwest. Their initial strategy was to grow through corporate
locations, but now they have moved on to franchising. Planet Sub currently has
22 corporate and 13 franchise locations for a total of 35 locations with 3 more
franchises in process opening soon. The typical Planet Sub location is 1,800
square feet with seating for 65.
There are several significant differences between Planet Sub and the other
sub sandwich franchises, including franchise giant Subway. According to
co-founder Sean Kelly one of the biggest things that set Planet Sub apart from
the others is the fact that they make their bread from scratch.
“We teach our franchisees to make bread totally from
scratch and it makes a difference in how we operate. Quality bread is a key
component of any sandwich and to provide our customers a sandwich that includes
freshly baked bread is a winner.” Sean Kelly
Unlike most of their competitors, approximately 80% of Planet Sub business
consists of sit down customers which includes table service. A customer receives
a playing card after they order and simply use the card to claim their order.
Sean told me: “We’ve built up a strongly popular catering service that includes
fruit bowls and salads in addition to our subs. For our corporate stores;
customers call a dedicated phone line while franchisees use their own toll free
Now that Planet Sub has built a successful food concept with a corporate
network they are on their way to build a successful franchise program. I
was impressed with the basic components of their franchise program. Compared to
their competitors Planet Sub franchisees pay a modest 4% royalty. Their ad fund
program will be implemented once they reach 50 franchisees.
I was impressed with the basic components of their
franchise program that includes a reasonable 4% royalty and ad fund contribution
that won’t be implemented until they reach 50 franchisees. Sean and Jeff are
focused on franchisee profitability!
Planet Sub also does an Item 19 disclosure, however as Sean explained they
only disclose revenues. This is to avoid any possible confusion or
misunderstanding on the part of prospective franchisees by Planet Sub disclosing
earning information. By providing revenue results by location a prospective
franchise can apply their estimated cost and expense figures to their sales
projections using the information from Item 19 in the process. However, as Sean
explained, they encourage candidates to speak with Planet Sub franchisees since
they are the best and most complete source of financial performance.
Franchisees are granted a territory that has a radius of approximately 4
miles and Sean told me that he and Jeff are being very careful to avoid any
encroachment issues. The investment in a Planet Sub franchise including an
initial franchise fee of $25,000 ranges from $130,000 to $376,000 with a
franchise term of 10 years plus a renewal option.
It’s refreshing to see a franchise concept like Planet Sub enter the
franchise scene. A franchise model with a reasonable royalty and a program based
upon a successful model of multiple corporate locations.
Contact Planet Sub
© 2011 FranchiseKnowHow, LLC
Ed Teixeira is the President of FranchiseKnowHow, LLC. He
can be reached at firstname.lastname@example.org