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Potbelly’s Growth Slows…For Now

Potbelly’s Sandwich Works with its core markets being Chicago, Washington D.C., and Texas, is walking away from some potential new locations, and renegotiating leases on existing locations to “reflect the new market conditions.”

In recent months the sandwich chain has walked away from at least two prospective deals in the suburbs, in Hillside and Romeoville, and local real estate sources say company executives have told them Potbelly is pulling back its growth plans here.

Potbelly founder Bryant Keil said last year that the chain could double its Chicago-area stores to more than 150, and hired former Sears CEO Aylwin Lewis to spearhead growth nationwide. Mr. Lewis said he wanted to accelerate expansion and at the very least maintain Potbelly’s growth rate of about 40 new restaurants a year.

But the dramatic drop in the economy over the last six months has hit even the private Chicago-based company known for its kitschy décor, toasted subs and fresh-baked cookies. Potbelly’s costs to build its stores are higher than its rivals’, sources say, so the company can’t afford too many mistakes in a climate where sales are likely to be slow.

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PotBelly's yum. I just flew out of Washington-Reagan a few hours ago and stopped at the PotBelly's at the airport. I was disappointed again that this locations varies from the standard in beverage selection, which in my case cuts the guest check on them, but I got my Vegetarian and it was scrumptious as usual. FuwaFuwaUsagi


They also (wisely) pulled out of a deal in downtown Aurora. I was worried when I heard they were considering it, and felt better about them when they had the sense to pull out. FuwaFuwaUsagi