Firehouse Subs is so eager to open more sub shops it is offering franchisees a tempting incentive for them to do so: Cash.
The Jacksonville, Florida-based sandwich chain earlier this month announced a 2026 development incentive program that will offer franchisees $75,000 in cash if they open one location next year. Those who commit to two or more can get $100,000 per location.
The program is an expansion of an incentive program started last year, which provided veterans and first responders up to $100,000 per restaurant.
The reason is simple. Firehouse Subs wants more Firehouse Subs, and it needs to encourage franchisees to open them. The incentive “eases initial financial burdens and helps franchisees build a solid business foundation,” the company said in its announcement.
“We’re confident these programs will allow franchisees to establish meaningful businesses while serving delicious subs and supporting their communities through our Public Safety Foundation,” Mike Handcock, president of Firehouse Subs, said in a statement.
Such incentives have grown more common of late. Franchised restaurant brands are eager for growth, and many executives believe their brands deserve to open more units than they have been. Several chains, including Potbelly, Marco’s Pizza, the fast-casual burrito chain Qdoba, Wendy’s and others have either added new incentives or made existing programs more robust over the past couple of years.
Franchise incentives become more common when the economics of owning a restaurant grow more challenging and financing is more difficult. Numerous brands aggressively used franchise incentives coming out of the Great Recession, for instance. And they’ve returned amid slow sales, profitability and financing challenges.
Firehouse Subs competitor Potbelly in May announced incentives for large-scale developers with discounted franchise fees and a 50% cut in royalty payments if stores are opened before a certain date. The operator must agree to open at least 15 shops in eight years or less. Two operators, one in Atlanta and one in Texas, have signed up for the program.
Potbelly is shifting more toward franchising and it is eager to translate some of its improving sales into actual unit growth. The chain has closed nearly 7% of its restaurants over the past five years and finished 2024 with 442 locations, according to data from Restaurant Business sister company Technomic. But all that came from a reduction in corporate locations.
Franchisees at the end of last year operated 96 of the chain’s locations, more than double the number from five years earlier. The company has also targeted its incentives at larger, “more financially savvy franchisees.”
“As we’ve seen some of those larger, more financially savvy franchisees show interest in the company, they see this as a big deal,” Potbelly CEO Bob Wright said in May, according to a transcript on the financial services site AlphaSense.
Incentives appear to be more common in sectors where growth has slowed. Sales at quick-service pizza chains grew less than 1% last year according to Technomic data. Yet franchise growth incentives may be more common there than anywhere else.
Papa Johns early last year added new incentives to encourage franchisee development, including a waiver on marketing fund contributions for five years. The chain has long used incentives to encourage growth, with mixed success. Pizza Factory late last year announced an incentive program.
Marco’s Pizza announced incentives, including 0% royalties for the first six months after a location is open, for those operators who sign on for three to five locations. “By managing controllable costs, we’re proud to offer a program that reflects our commitment to supporting future owners as they navigate this ever-changing economic landscape,” Gerardo Flores, chief development officer for the chain, said in a statement.
Marco’s has grown consistently over the years, though unit growth appears to have slowed slightly more recently, to 4% in 2024 from 6.5% in 2022.
As with pizza chains, fast-food sandwich concepts have seen sales stagnate recently. Sales at quick-service sandwich chains fell more than 3% last year, according to Technomic. So it’s probably not much of a surprise to see more sandwich brands take that leap, which Jimmy John’s introduced in 2021.
These brands also have to keep pace with market leader Jersey Mike’s, which generated unit growth of 12% last year. By comparison, Firehouse Subs’ unit growth was just 3%, up from 2% in 2022, the year after it was bought by Burger King owner Restaurant Brands International.
RBI bought the company believing it had plenty of white space for domestic growth. With so many sandwich brands looking at incentives, therefore, Firehouse kicked off a program of its own.
UPDATE: This story has been updated to correct a reference to franchisees that have signed up for Potbelly's incentive program.
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