PENN STATION, EAST COAST SUBS

Financial entry is steep for fast casual: $507,500-$858,750 total investment, including a flat $25,000 franchise fee (Item 7). Royalties tier from 2% to 8% of monthly net sales—far from the typical flat 5-6% in sandwiches, potentially ballooning costs if volumes dip (Fees Notes). Add 2% brand fund and up to 2% local ads, totaling 6-12% ongoing. No Item 19 earnings means no median revenues or profits from existing units, forcing reliance on FDD projections or franchisee calls— a major blind spot in due diligence. SBA data shines here: 43 loans averaging $509,558 align closely with buildout costs, suggesting accessible financing but check default rates for risks.

System maturity shows 322 franchised units (1 corporate), inching from 318 in 2022 to 322 in 2023—a mere +1% growth amid food sector inflation and competition from Jersey Mike's or Jimmy John's. Only 3 transfers signal low turnover, hinting at franchisee retention without mass exits. For investors, the upscale positioning justifies higher costs versus Subway's $238K-$536K range, but stagnant growth and escalating tiered fees demand strong local demand in target areas. Without revenue transparency, validate with Item 20 contacts; this isn't explosive scaling but potentially a steady neighborhood player if your operations hit volume thresholds.