I’m a local Chicagoan so Potbelly’s Sandwich Works news is interesting to me. As you’ve probably heard, Potbelly is now franchising their potbelly stove themed restaurant. Their web site lists the total cost to open between $500k-$750k with a heavy $40k franchise fee.
I predicted this early in 2009 after I noticed job posting listing franchising experience and a little snooping.
A previous insider comment to a blog post on Potbelly has always stuck in my head which makes me pause about the opportunity. I’m pretty sure I know the person who wrote the comment:
Potbelly is another stab in the dark venture that suffers from ridiculous logistical design, high labor costs, exorbitant pricey locations, and excessive buildout costs. Is there any wonder thay GREw so much. did you expect them to just sit on the 100,000,000 raised by Starbuck’s Maveron Group. funny, potbelly has turned one quarterly profit in about 6 years and had three presidents in three years. The lines which everyone seems to think are the sign of success are a sign of basic incompetency and presume people will continue to buy into hype for a three day old bun baked by Turano (same as the other great success story Quizno’s ) and generic low quality meat that’s run through a conveyor oven which can’t be delivered or catered without serious degradation in quality. other than the expensive logo vanity packaging someone and the illusion of quality based on 500,000 of faux antiques, please explain what is original or significant quality. the sandwiches are the smallest, the most expensive per ounce, and the worst produced in terms of speed and efficiency than any I have ever seen and the lines aren’t looking too long these days. Nothing angers me more than a hot concept and has never managed to turn a profit. Think Cosi, Planet Hollywood, etc. that’s why the restaurant business gets a bad rap. Anyone with a brain could say hmmm lowest check average, slowest production line, highest rent, most labor and they don’t make money? Duh!