Earnings Claims of Top Franchises Revealed

Earnings Claims of Top Franchises Revealed

  • Anytime Fitness
  • CruiseOne
  • Firehouse Subs
  • Jimmy John's
  • Massage Envy
  • Menchie's
  • Orange Leaf Frozen Yogurt
  • Planet Fitness
  • The UPS Store
  • Yogurt Land
  • And Hundreds More...

No, thanks. I'm not interested in uncovering the actual earnings of hundreds of franchises at this time.

FDD Talk 2013: Gross Sales and Other Operating Information for Certain Jimmy John’s Restaurants (2013 FDD)

by Franchise Chatter on May 29, 2013

in Franchise Earnings, Sub Sandwich Franchise



Franchise Chatter Membership Information

Don't Invest in a Franchise Until You Check Out This List Find the Ideal Business for You

Highlights of Jimmy John’s Item 19 Financial Performance Representations (2013 FDD)

Gross Sales Information for Certain Franchised Jimmy John’s Restaurants and Gross Sales and Other Operating Information for Certain Affiliate-Owned Jimmy John’s Restaurants

  • This financial performance representation contains:
  • (1) actual 2012 average annual gross sales information for all Jimmy John’s Restaurants (both franchised and affiliate-owned), and separately for all franchised Jimmy John’s Restaurants, in operation in the United States during the entire 2012 Fiscal Year (Section I);
  • (2) information regarding the actual gross sales and certain other operating results of affiliate-owned and operated Jimmy John’s Restaurants that opened before January 4, 2012 (25 of 26 Restaurants total) (Section II); and
  • (3) actual partial operating financial statements for 2 affiliate-owned and operated Jimmy John’s Restaurants (Section III).

Explanatory Notes for Section I – Average Annual Gross Sales for All Jimmy John’s Restaurants and (Separately) for All Franchised Jimmy John’s Restaurants in Operation During the Entire 2012 Fiscal Year

  • Jimmy John's Restaurant Exterior Photo by KenobiwanXGross sales (for purposes of the system-wide average) are defined as gross receipts net of sales tax but after deducting amounts for coupons and promotions.
  • The average includes all Restaurants that were open during the entire 2012 Fiscal Year, even if their ownership changed during that time period.
  • The total number of Restaurants included in this average was 1,309 (25 affiliate-owned and 1,284 franchised). This average does not include 230 new Restaurants that opened, 22 Restaurants that suspended operations, and 1 Restaurant that closed during 2012 and therefore were not open for the full 2012 Fiscal Year.
  • In addition, there were 577 Restaurants for which Franchise Agreements had been signed, but which were not open, as of January 1, 2013, the end of the 2012 Fiscal Year.
  • The franchised Restaurants whose average gross sales are reported below are located in various types of structures (for example, strip mall, shopping center, food court, and free-standing) and various types of venues (for example, college campus, downtown, metropolitan area, and suburban area).
  • The 25 affiliate-owned Restaurants are located primarily on college campuses.
  • Jimmy John’s obtained the gross sales information for franchised Restaurants from weekly royalty reports submitted by franchisees. Jimmy John’s has not independently audited that information.
  • The franchised Restaurants that were open for operations during the entire Fiscal Year 2012 and whose average gross sales are reported below are substantially similar to the Restaurant franchises that Jimmy John’s currently offers.
  • The actual average annual gross sales numbers reported below do not reflect the costs of sales, operating expenses, or other costs or expenses that must be deducted from the gross sales figures to obtain your net income or profit.

Explanatory Notes for Section II – Annual and Monthly Gross Sales Ranges and Averages, and Certain Cost Information, for Affiliate-Owned Jimmy John’s Restaurants

  • The figures in Charts A1, A2, B1, and B2 are based upon sales and expense reports provided to the franchisor by JJE, an affiliate. The gross sales and expenses of these Jimmy John’s Restaurants are impacted by the strong consumer name recognition and goodwill that Jimmy John’s Restaurants enjoy in the core Midwest market.
  • While Jimmy John’s believes that its Restaurants will have consumer appeal in all geographic areas of the United States, the Jimmy John’s Restaurant concept has had limited operating history outside of its core market.

Chart A1

  • Chart A1 below relates to the annual and monthly gross sales ranges and averages for the 2012 Fiscal Year of the 18 Jimmy John’s Restaurants owned and operated by JJE that opened before January 1, 2008 and were open for operations during the entire 2012 Fiscal Year.
  • Six of these Restaurants operated in Illinois, 2 operated in Indiana, and 10 operated in Michigan.
  • Gross sales is defined in this section as gross receipts net of sales tax but before deducting amounts for coupons and promotions.

Chart A2

  • Chart A2 below relates to the annual and monthly gross sales ranges and averages for the 2012 Fiscal Year of the 7 Jimmy John’s Restaurants owned and operated by JJE that opened after January 1, 2008 and before January 1, 2012 and were open for operations during the entire 2012 Fiscal Year. (One new affiliate-owned Jimmy John’s Restaurant opened during 2012.)
  • Five of these Restaurants operated in Arizona, one of these Restaurants operated in Illinois, and one of these Restaurants operated in Michigan.
  • Gross sales is defined in this section as gross receipts net of sales tax but before deducting amounts for coupons and promotions.

Chart B1

  • Chart B1 below relates to the annual cost of goods sold as a percentage of gross sales, annual labor costs as a percentage of gross sales, and annual net profit as a percentage of gross sales for the 2012 Fiscal Year of the 18 Jimmy John’s Restaurants owned and operated by JJE that opened before January 1, 2008 and were open for operations during the entire 2012 Fiscal Year.
  • Cost of Goods Sold is defined as all paper, produce, food, beverages, and sides that are bought to make up the products sold in a Jimmy John’s Restaurant.
  • Labor is the actual labor cost of all personnel in that Restaurant; however, it does not take into account any bonuses paid to managers or any draws paid to the owner.
  • Net profit is gross sales less cost of goods sold and less all expenses incurred, but excluding depreciation, debt service, amortization, income taxes, royalties, charitable donations, travel, shipping, administrative salaries, draws to the owner, and expenses related to unit option plans.

Chart B2



  • Chart B2 below relates to the annual cost of goods sold as a percentage of gross sales, annual labor costs as a percentage of gross sales, and annual net profit as a percentage of gross sales for the 2012 Fiscal Year of the 7 Jimmy John’s Restaurants owned and operated by JJE that opened after January 1, 2008 and before January 1, 2012 and were open for operations during the entire 2012 Fiscal Year.

Explanatory Notes for Section III – Statement of Gross Sales, Expenses, and Cash Flows for Two Affiliate-Owned and Operated Jimmy John’s  Restaurants

  • Jimmy John's sandwich photo by sailoraideThis section relates to the actual and/or adjusted operating financial results of two sample affiliate-owned and operated Jimmy John’s Restaurants with above-average gross sales.
  • While these specific restaurant figures have not been audited, they are included in total company-owned restaurant figures which are subjected to audit procedures at a consolidated level.
  • The cash flows shown in the statements are before:  draws for the owner, management bonuses, financing cost, amortization and depreciation, income taxes, charitable donations, travel, shipping, administrative salaries, and expenses related to unit option plans.

Restaurant 1

  • Restaurant 1, located in Illinois, has been operating continuously since opening in 1987.  It is the second highest grossing Restaurant of all the affiliate-owned and operated Restaurants. It is roughly 1,000 square feet in size and is in a strip mall on a college campus.
  • As of January 1, 2013, there were 7 other Jimmy John’s Restaurants in Illinois; 1 of these reported higher annual gross sales than Restaurant 1 for the 2012 Fiscal Year.

Restaurant 2

  • Restaurant 2, located in Indiana, has been operating continuously since opening in 1990. It is roughly 870 square feet in size and is in a strip mall on a college campus.
  • As of January 1, 2013, there was 1 other Jimmy John’s Restaurant in Indiana. Restaurant 2 reported the lowest annual gross sales of the 2 Indiana Restaurants for the 2012 Fiscal Year.

The following expenses do not appear in the statements of income and cash flows. There were no other items that were modified or excluded in preparing the statements.

  • The statements include salaries for Restaurant employees but exclude salary or draw for the owner and administrative salaries. They also do not include any bonuses paid to the management staff or expenses related to unit option plans.
  • The statements reflect a current continuing royalty of 6% and advertising fees of 4.5% of gross sales. Because these are affiliate-owned and operated Restaurants, no royalties were actually paid. This figure was inserted into the statements to resemble the cash flow of a franchised Restaurant. The affiliate-owned and operated Restaurants do make advertising fund contributions.
  • Depreciation of leasehold improvements and equipment. To the extent leasehold improvements are paid for and capitalized by the franchisee, these amounts are normally depreciated over the life of the lease. Equipment is normally depreciated over 5-7 years. Leasehold improvements are normally depreciated over 7 years.
  • The financing, amortization, and interest costs for leasehold improvements and equipment are not shown. Similarly, amortization of the initial franchise fee and organization costs is not shown.
  • Costs related to employee travel, shipping items from the restaurant to the corporate office, income taxes, and charitable donations are not shown.

Section I – Average Annual Gross Sales for All Jimmy John’s Restaurants and (Separately) for All Franchised Jimmy John’s Restaurants in Operation During the Entire 2012 Fiscal Year



To Access the Rest of This Article and Other Premium, Income-Enhancing Content, Subscribe Now or Log In.

Gain the Insider Information (and Actual Earnings Data) You Need to Make a Safe and Smart Franchise Investment. Click Here to Learn More.



Gain the Insider Information (and Actual Earnings Data) You Need to Make a Safe and Smart Franchise Investment - See more at: https://www.franchisechatter.com/register/#sthash.le7wKJKM.dpuf


Franchise Matching Quiz



{ 0 comments… add one now }

Leave a Comment

Previous post:

Next post: