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7 Replies Last post: Oct 12, 2007 9:06 PM by plucash

Is starting a sandwich shop a good idea?

Aug 23, 2007 9:20 AM

JavaJoe 19 posts since
Jul 28, 2007

I've been wanting to start my own business for some time and am thinking of starting one related to the food industry as I have experience working and managing a restaurant. There's a great location up for lease that would be perfect for a sandwich shop. I haven't crunched the financials yet and was wondering if any community member has experience with this type of business and can weigh in on this business oppportunity. Also, top of mind is the burning question - how profitable can a sandwich be? What are the margins?

Tags: new_business, food Report as inappropriate

LUCKIEST 7,942 posts since
Aug 6, 2007

1. Re: Is starting a sandwich shop a good idea? Aug 23, 2007 11:39 AM

Going into business is the American Dream.
SCORE suggests you write a BUSINESS PLAN, explaining in detail your plans to
develop a successful business.
How soon do you need to make a decision??
Do you have an Accountant??
Please do not hesitate to write again if you need additional info.
Good luck, LUCKIEST

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FashionGal 32 posts since
Jul 29, 2007

2. Re: Is starting a sandwich shop a good idea? Aug 23, 2007 12:48 PM

I do not have any experience in the food industry but would like to offer a suggestion. Maybe you can investigate the financials of an existing sandwich franchise like Subway for example? That information should be public. Although the numbers for your own sandwich shop vs. a franchise will be different, it may help give you a better perspective on what to consider when calculating total costs, risks, etc.

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SCORE108 12 posts since
Aug 6, 2007

3. Re: Is starting a sandwich shop a good idea? Aug 23, 2007 3:24 PM

The questions you ask about how profitable can a sandwich be and what are the margins are just a few you need answers to before you sign a lease. By writing a business plan you are forced to think about and find answers to the many areas that need to be covered. I would hold off signing a lease until you have all of the other areas covered. You can find a business plan outline at our SCORE website [www.oshkoshchamber.com/SCORE/score.html|http://www.oshkoshchamber.com/SCORE/score.html] You can also do a Google search for "sample business plan" and find much information on writing a plan.

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Score133 34 posts since
Aug 14, 2007

4. Re: Is starting a sandwich shop a good idea? Aug 29, 2007 1:53 PM

A sandwich can be very profitable! I used to own a little cafe and made just a little more than I ever expected I would with a very limited desserts only menu.There are three points of advice I'd like to share with you: 1) define your customer; 2) conduct foot traffic counts at your location, and 3) crunch the numbers! It doesn't matter how good your sandwiches are, if they're not being served in the right place, no one will buy them. Where are your customers? What is your competition? How much do your customers make? And how many of them will walk right past your door to get to another shop? How will you attract them into your establishment? How much will they pay for a sandwich? Enough to make a profit? But forget the answers to all of these questions until you crunch the numbers. You should be able to find out the rent, average electric bill, number of employees/payroll you'll need, etc. Just make a list and start calling folks (landlord, electric company, staffing companies, etc.) The next big piece of info you'll need is cost of inventory. You can simply make an appointment with a purveyor of the types of products you'll need (Cysco, Henry Lee, BoarsHead) and get prices. It's not too hard to get some preliminary figures together. Then put it all into a good business plan (SCORE.org or WBA.gov both have great formats). Good luck to you...you're in for the time of your life!

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cozmo53 6 posts since
Oct 10, 2007

5. Re: Is starting a sandwich shop a good idea? Oct 10, 2007 11:13 AM

I think a sandwich shop is an awesome idea.
I purchased a territoy for the franchise sales of sandwich shops.
My experiance is most people dont do their homework and business plan like they should.
This is a major investment and undertaking.
The most important factors are rent, food costs, labor costs, loan costs for build-out-equipment-inventory start-up and promotion/marketing.
Most people dont realize that Marketing and quantity of Sales is what drives profitability.
You can spend money on Marketing, but when the customer comes in you must be accurate on the order, have a great product, and use the Golden Rule with a smile on your face or your Marketing $spent are spent for nothing!
This is what I have learned from my short time in this field, but I now have the success plan and know how to impliment it.
I think a Franchise is a much better way to success, compare the failure rates and the most important thing is having back-up capital in case sales are slow the first 1-2 years.
Under capitalization (back up reserve money) leads to a high rate of failure in this industry!
The people that have tuffed out the first1-2 years and have established catering into their business have some unbelievable Sales numbers-it is a niche, and very profitable if done right!
Good Luck!

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inquiz77 1 posts since
Oct 10, 2007

6. Re: Is starting a sandwich shop a good idea? Oct 10, 2007 12:26 PM

hi javajoe,
i've been in the food business most of my life ,basically working for someone else,until 15 years ago my wife and i opened our own restaurant. i thought it was going to be apiece of cake because of our previous experience, i was wrong.being in business is completly different then working for someone else.you must consider the whole realm of things, bookkeeping,managering,ordering,dealing with employees much more opening your own business is being married to it 24/7. our first year in business we worked 360 days straight ,10-12 hours days.you must be committed to your goal and stick to it. then your business can be as profitable as you want it to be. in most cases it's extremely hard work
good luck!

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plucash 1 posts since
Oct 12, 2007

7. Re: Is starting a sandwich shop a good idea? Oct 12, 2007 9:06 PM

As with any business - it depends. If you were in Manhattan, sandwich shops print money. They open at 630 or so, serve basic breakfast (nothing requiring cooking!), a lull, then lunch, and close at 330 or so.

There is probably a trade association - no joke. The vendors who supply sandwich shops are also a good source of information, and will often do a lot to help you set up, complete with menu items and the like. Sysco is one large food supplier that I know.

Go visit a shop somewhere away from where you are thinking about setting up, and see if someone will talk to you. Sometimes they will. SCORE is one option, the Chamber of Commerce may have some contacts.

In the food business, the hardest part is knowing your costs and pricing accordingly.

Hope this helps!
Peter

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Is starting a sandwich shop a good idea?

Aug 23, 2007 9:20 AM

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