A defensible analytical range for a manager-run Jimmy John’s restaurant is approximately $51,000 to $200,000 in annual pre-tax operating earnings, with a base scenario of about $106,000. This is not an official Jimmy John’s profit disclosure. The 2026 Franchise Disclosure Document reports 2025 Annual Unit Volume, which means Gross Sales, but it does not report restaurant profit, owner compensation, or cash flow.
- Legal franchisor
- Jimmy John’s Franchisor SPV, LLC, an indirect subsidiary within Inspire Brands.
- Current document
- 2026 Jimmy John’s FDD, issued March 26, 2026. Item 19 appears on pages 80–83.
- Item 19 evidence
- Historical 2025 Annual Unit Volume, defined as Gross Sales, for selected franchised U.S. restaurants; no expense or profit disclosure.
- Applicable formats
- Traditional restaurants with and without drive-thru service and a small Non-Traditional Location cohort. The primary scenario uses the all-restaurant distribution, which is predominantly traditional.
- External benchmark
- IRS Statistics of Income, 2023 partnership tax data for Accommodation and Food Services, supplemented by Bureau of Labor Statistics manager-wage data.
- Date checked
- July 15, 2026.
Median Gross Sales across 2,581 reporting franchised restaurants.
Rounded result from the median AUV and the 11.14% broad-sector margin proxy.
6% royalty, 4.5% Advertising and Development Fund, and 0.5% local marketing, before any cooperative advertising.
2,556 traditional and 25 non-traditional franchised restaurants in the reported cohort.
Derived from IRS partnership tax data for the broad Accommodation and Food Services sector.
What does Jimmy John’s Item 19 actually measure?
Item 19 officially measures restaurant revenue, not owner earnings. The 2026 FDD calls the measure Annual Unit Volume, or AUV, and defines it as annual Gross Sales for the 2025 fiscal year running from December 30, 2024 through December 28, 2025. The reported all-restaurant median was $955,639 and the average was $1,007,437.
The cohort contained 2,581 franchised U.S. restaurants: 2,556 traditional restaurants and 25 Non-Traditional Locations. It excluded restaurants that opened during 2025 without a full year of operations, certain restaurants with extended no-sales periods, Multi-Brand Locations, 33 restaurants that closed during 2025, and every company-owned restaurant. The restaurants in the cohort had operated for an average of 14 years, so the disclosure is mainly evidence about established locations rather than a new-store ramp.
| 2025 Item 19 group | Restaurants | Median AUV | Average AUV |
|---|---|---|---|
| First quartile | 645 | $1,411,318 | $1,490,247 |
| Second quartile | 645 | $1,076,504 | $1,081,405 |
| Third quartile | 645 | $848,939 | $850,650 |
| Fourth quartile | 646 | $632,334 | $608,313 |
| All reported restaurants | 2,581 | $955,639 | $1,007,437 |
Official source: 2026 Jimmy John’s FDD, Item 19, pp. 80–83. Sales reports came from franchisee submissions and point-of-sale systems and were not independently audited by a certified public accountant. The franchisor states that written substantiation is available upon reasonable request.
How is the $51,000–$200,000 earnings range calculated?
The range multiplies three official Item 19 revenue anchors by three transparent margin assumptions. Conservative revenue uses the fourth-quartile median AUV, the base uses the overall median AUV, and upside uses the first-quartile median AUV. Those quartile medians are observed historical sales levels, not probabilities or promises.
The central 11.14% margin is an EBITDA-like tax-return proxy derived from the IRS 2023 Partnership Table 1 for Accommodation and Food Services: ordinary business income plus interest paid plus depreciation, divided by total income. In source units, the calculation is ($4.430 billion + $14.983 billion + $22.370 billion) ÷ $375.104 billion. The conservative and upside margins are the benchmark minus or plus 3 percentage points, producing 8.14% and 14.14% before display rounding.
- Conservative: $632,334 fourth-quartile median AUV × 8.14% = $51,465, rounded to $51,000.
- Base: $955,639 overall median AUV × 11.14% = $106,447, rounded to $106,000.
- Upside: $1,411,318 first-quartile median AUV × 14.14% = $199,544, rounded to $200,000.
- Definition: The results are before interest, depreciation, personal income taxes, financing principal, and capital expenditures. Normal manager compensation is assumed to be included in operating deductions.
- Fee treatment: Standard Jimmy John’s recurring fees are treated as embedded in the all-in industry expense proxy and are not deducted a second time.
Annual dollars per restaurant; rounded to the nearest $1,000
Interpretation: The scenario spread is driven by both the wide Item 19 sales distribution and a six-percentage-point operating-margin sensitivity band. The base is an analytical anchor, not a forecast of the most likely result.
Sources: 2026 Jimmy John’s FDD, Item 19, pp. 80–83; IRS partnership statistics by sector or industry; IRS 2023 Partnership Table 1 workbook. Margin sensitivity is an editorial scenario assumption.
How does owner involvement change the result?
An active owner who replaces a paid food service manager may receive total owner-operator benefit of roughly $115,000 to $263,000 across the same scenarios. That figure is not pure business profit. It combines the manager-run operating result with $63,040 of labor value, the Bureau of Labor Statistics’ May 2024 median annual wage for food service managers in Food Services and Drinking Places.
The 2026 FDD makes owner structure important. Unless the franchisee qualifies as a Sophisticated Franchisee, the restaurant must have an approved Operations Partner managing the location on-site each day, and that Operations Partner must hold at least 5% fully vested ownership. A Sophisticated Franchisee—an entity that, with affiliates, owns and operates at least five limited-service restaurants—must instead maintain an approved on-site general manager. An owner may fill the Operations Partner role only if the franchisor accepts the person and the required training is completed.
Owner-operator figures add $63,040 of manager labor value; they do not represent passive profit
Interpretation: Active operation can increase the economic benefit reaching the owner, but the increase compensates the owner for management labor. It should not be described as passive income or as an increase in restaurant-level profit.
Sources: 2026 Jimmy John’s FDD, Item 15, pp. 74–75, and Item 6, p. 32; BLS Food Service Managers profile. The $63,040 wage excludes employer payroll taxes, benefits, and any ownership compensation required for an Operations Partner.
Residual operating earnings remain after normal manager compensation assumed within the industry benchmark. For a non-Sophisticated Franchisee, actual Operations Partner pay and the required 5% ownership interest may differ materially from a conventional employee-manager arrangement.
Total benefit includes both residual operating earnings and the market value of work performed. It does not include personal income taxes, and it does not imply that the restaurant produces the same result without the owner’s labor.
Which restaurant characteristics can move annual earnings most?
Sales position, labor efficiency, and occupancy are likely to move earnings more than any single published fee. Item 19 shows substantial revenue dispersion. The first-quartile median AUV was about 2.23 times the fourth-quartile median, so an owner’s sales cohort can change the earnings model before any margin difference is considered.
| Restaurant type | Restaurants | Median 2025 AUV | Average 2025 AUV |
|---|---|---|---|
| Traditional with drive-thru | 972 | $1,073,927 | $1,107,798 |
| Traditional without drive-thru | 1,584 | $893,888 | $943,539 |
| Non-Traditional Location | 25 | $1,014,872 | $1,085,163 |
The drive-thru cohort’s median AUV was approximately 20% above the traditional no-drive-thru cohort’s median. This is an association, not evidence that adding a drive-thru causes the difference. Site quality, market density, restaurant size, access, competition, age, and other operating characteristics may also differ. The Non-Traditional Location sample is only 25 restaurants, so it should not be blended into a traditional-unit earnings estimate without separate expense and fee evidence.
Temporary incentive programs may reduce royalty or Advertising and Development Fund rates for qualifying restaurants, markets, openings, relocations, or remodels. Because eligibility and duration vary, the earnings scenarios use the standard ongoing rates rather than assuming an incentive.
What does the earnings estimate leave unresolved?
The largest unresolved question is the actual restaurant-level cost structure of a comparable Jimmy John’s unit. Item 19 does not disclose food cost, hourly labor, manager compensation, rent, utilities, insurance, delivery economics, maintenance, or store-level profit. The IRS proxy is too broad to resolve those items precisely.
- Population bias: Item 19 excludes new partial-year restaurants, certain extended closures, Multi-Brand Locations, 33 restaurants that closed during 2025, and all company-owned restaurants.
- Maturity bias: Reported restaurants averaged 14 years in operation, while a new unit may face ramp-up costs and lower initial sales.
- Benchmark mismatch: IRS partnership data cover a broad sector and multiple business formats, legal structures, and operating models.
- Owner-role ambiguity: A non-Sophisticated Franchisee’s Operations Partner must own at least 5%, so labor cost, equity sharing, and distributions can differ from a standard manager salary.
- Debt service: The scenario is before interest and principal. A financed acquisition or build-out can materially reduce annual cash available to the owner.
- Capital expenditures: Depreciation is added back in the proxy, but equipment replacement, remodels, and maintenance still require cash.
- Personal taxes: No after-tax take-home estimate is provided because outcomes depend on entity structure, jurisdiction, deductions, and owner circumstances.
Item 7’s traditional-location initial investment range of $366,200 to $733,500 is not an annual operating expense and is not subtracted from one year of sales. Financing, depreciation, and future capital spending must be modeled separately from annual restaurant operations.
What should a buyer verify before relying on the range?
A buyer should treat $51,000–$200,000 as a screening range and replace the proxy assumptions with unit-specific evidence. The most useful next evidence is the written substantiation behind Item 19, actual profit-and-loss statements for comparable restaurants, and consistent interviews with current and former franchisees listed in Item 20.
- Request Item 19 written substantiation and confirm how Gross Sales adjustments, closures, remodels, and unusual receipts were handled.
- Obtain trailing 12-month profit-and-loss statements from restaurants with similar AUV, drive-thru status, age, square footage, labor market, delivery mix, and occupancy profile.
- Separate food and paper cost, hourly labor, manager or Operations Partner compensation, occupancy, insurance, utilities, repairs, delivery fees, and all franchise-system charges.
- Verify whether a Cooperative Advertising Program applies locally and whether any temporary royalty or fund incentive is actually available.
- Ask franchisees how much time the owner works, what the Operations Partner receives in wages and equity economics, and which expenses are paid above restaurant-level profit.
- Model loan interest, principal, required reserves, remodels, and equipment replacement separately from operating earnings.
- Compare mature restaurants with recent openings instead of applying a 14-year-average cohort directly to a first-year unit.