Financing

Potbelly keeps its focus on growth through franchising

The fast-casual sandwich chain said it has 192 franchised stores currently under development. It also released an updated rewards app.
Potbelly
Potbelly is focused on increasing its based of franchised stores. | Photo: Shutterstock

Potbelly, which has been squarely focused on unit growth since coming out of the pandemic, has nearly 200 stores under development, the Chicago-based sandwich chain announced Tuesday.

The brand signed 192 new development commitments around the U.S., part of its Franchise Growth Acceleration Initiative. New restaurants are slated for New York, Maryland, Florida, Ohio, Washington, Arkansas, North Carolina, Tennessee and Texas.

The new Potbelly franchisees have experience with restaurant brands including Burger King, Dunkin’, Wendy’s and Wingstop, the operator said.

“Our 5-Pillar Strategy, which focuses on traffic-driven profitability and franchise unit growth, has yielded impressive results since putting it in place in late 2020,” President and CEO Bob Wright said. “We’re pleased with the continued momentum we’ve seen in 2023 in sales and traffic growth, margin expansion and franchise development commitments across the U.S.”

The latest round of development agreements is part of Potbelly’s long-term goal of reaching 2,000 locations, about 85% of which would be franchised. The chain currently has about 425 U.S. stores but only about 17% are currently run by franchisees.

Potbelly has announced a number of franchising and refranchising deals in recent months as it works toward that goal.

The fast-casual this week also debuted an updated version of its Potbelly Perks loyalty program.

Under the reimagined rewards offering, members can earn rewards more quickly and access more of the menu for rewards redemptions. It also replaces the chain’s former Points program with a bankable Coins format. Points from the previous version will now be converted to Potbelly Coins.

Members earn 10 Coins for every dollar spent at Potbelly, with higher member levels earning more on each visit. In the past, diners needed 1,000 Points to earn an entrée. Under the new system, redemption begins at 200 Coins and options include sides, cookies, shakes, drinks and more.

“The reimagined Perks loyalty program puts Potbelly fans in greater control of their rewards,” CMO David Daniels said in a statement. “Previously our fans had to wait until they had enough points to earn a reward for a free entrée. Now they can earn a reward in as little as one or two visits and have access to the entire menu.”

Earlier this month, Potbelly said in releasing preliminary financial results that it expects same-store sales growth in the fourth quarter of 5.9% to 6.4%, up from earlier guidance of 4% to 6% growth. The chain said it predicts a roughly 12% increase in full-year same-store sales for 2023, with average unit volumes of about $1.3 million.

Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.

Multimedia

Exclusive Content

Financing

Crumbl may be the next frozen yogurt, or the next Krispy Kreme

The Bottom Line: With word that the chain’s unit volumes took a nosedive last year, its future, and that of its operators, depends on what the brand does next.

Technology

4 things we learned in a wild week for restaurant tech

Tech Check: If you blinked, you may have missed three funding rounds, two acquisitions, a “never-before-seen” new product and a bold executive poaching. Let’s get caught up.

Financing

High restaurant menu prices mean high customer expectations

The Bottom Line: Diners are paying high prices to eat out at all kinds of restaurants these days. And they’re picking winners and losers.

Trending

More from our partners