Ryan is an attorney and valuation specialist residing in Chicago. He chronicles his thoughts and research on FranchisePundit.com. You may reach him by email ryanknoll@gmail.com or mobile telephone 312-212-3423.
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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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
Any one knows if they plan to open any new ones in Arlington Heights, Palentine, Schaumburg or any nearby suburbs?
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
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!