How Much Does a PrimoHoagies Franchise Owner Make?

Item 19 officially reports restaurant revenue and selected purchasing-cost ratios, not owner earnings. For the January 1 through December 31, 2025 measurement period, the 2026 FDD reports average Gross Sales of $927,299 and median Gross Sales of $871,099 for 81 franchised Designated Restaurants. Those figures apply only to the defined full-year cohort. Source: 2026 PrimoHoagies Franchise Disclosure Document, Item 19, pp. 46-47.

Item 19 also reports average and median percentages of Gross Sales for five selected purchasing categories. These are exact FDD labels, not a complete cost-of-goods schedule.

The disclosure does not provide labor, occupancy, utilities, insurance, payment processing, delivery commissions, repairs, depreciation, interest, or a complete cost-of-goods total. It also does not establish that the five categories are mutually exclusive or sufficient to reconcile a full income statement, so this analysis does not add them into a purported profit margin. The FDD's “Number Meeting or Exceeding the Average” column prints count-and-percentage pairs that do not reconcile to the 81-restaurant cohort on their face; for example, 54 is shown as 45%. Those pairs are not used in the model and should be clarified through the written Item 19 substantiation.

How broad is the Item 19 sample?

The official sample is useful but selective. It covers 81 franchised restaurants operating for the full 2025 year and excludes 33 restaurants that were not open for the full period, were terminated, were transferred, or were seasonal or nontraditional. Item 20 reports 114 franchised outlets at year-end 2025, 17 transfers during 2025, five outlets reacquired by the franchisor's affiliate, and four outlets that ceased operations for other reasons. Those events are not proof of losses, but they increase uncertainty because the Item 19 cohort does not represent every outlet experience. Source: 2026 FDD, Item 20, pp. 47-52.

The estimate multiplies three official Item 19 revenue anchors by three transparent net-income-margin assumptions. The base margin is derived from 2023 IRS Statistics of Income data for “Restaurants (full & limited service) and drinking places”: $2.610 billion of aggregate net income less deficit divided by $77.217 billion of business receipts, or 3.3807%. The conservative and upside margins are 3 percentage points below and above that benchmark, as an explicit analytical sensitivity.

Calculations use full-precision inputs and are rounded to the nearest $1,000 for publication. Scenario labels are analytical cases, not probabilities, forecasts, or franchisor representations. IRS source: 2023 Nonfarm Sole Proprietorships Table 1 spreadsheet.

Owner involvement is central because a single-unit PrimoHoagies restaurant is contractually owner-operated. Item 15 requires the owner or an approved principal to devote full time, energy, and best efforts, including at least 40 hours per week of on-premises management. A one-unit owner may not hire a manager to handle that on-premises role. Therefore, the scenario output should be read as owner-operator benefit, not pure passive business profit. Source: 2026 FDD, Item 15, pp. 38-39.

For a multi-unit owner, the operating model changes rather than becoming passive. Item 15 requires the owner or approved principal to devote at least 40 hours per week across the portfolio and requires a fully trained manager to devote at least 40 hours per week to each restaurant. Shared overhead, manager payroll, unit maturity, and development timing prevent a reliable portfolio estimate from simply multiplying the single-unit range.

At the official $871,099 median Gross Sales, the recurring royalty, Brand Fund, local-marketing minimum, and Software Service Contract total approximately $92,000 to $94,000 per year, or about 10.6% to 10.8% of sales. This is an official-fee calculation from Item 6, not an earnings estimate. It excludes food, labor, rent, utilities, insurance, repairs, delivery commissions, taxes, interest, and other operating costs.

Source: 2026 PrimoHoagies FDD, Item 6, pp. 7-10. The Item 6 fee table states a $9,000 annual local-marketing floor, while Note 2 states $8,000. This calculation uses the higher $9,000 figure and treats the discrepancy as a point requiring written clarification. The 1% amount at median sales is $8,711, so the $9,000 floor controls.

Actual earnings can fall below zero or exceed $82,000 because neither Item 19 nor the IRS benchmark fixes a PrimoHoagies unit's complete expense structure. The largest unresolved variables are non-owner labor, occupancy, local food and supplier pricing, delivery mix, sales volume, and whether accounting deductions such as interest and depreciation are substantial.

• Sales distribution: The conservative, base, and upside revenue anchors are official medians for the bottom quartile, full cohort, and top quartile. They are not probabilities and do not capture the FDD's $454,659 low or $1,946,313 high.
• Population selection: Item 19 excludes 33 restaurants that were new, transferred, terminated, seasonal, nontraditional, or not fully operational for the year. Excluding unstable or partial-year outlets can make the reported cohort stronger than the experience of all owners.
• Benchmark fit: IRS tax-year 2023 data combine full-service restaurants, limited-service restaurants, and drinking places organized as sole proprietorships. PrimoHoagies is a limited-service sandwich restaurant, and many franchisees may use LLC or S corporation structures.
• Owner labor: The IRS aggregate does not isolate compensation for the proprietor's work. Item 15 requires significant on-premises labor, so the scenario result cannot be treated as passive return on capital.
• Supplier economics: Nellie's Provisions, LLC is an affiliate and supplies certain required products. Item 19 reports selected purchasing percentages but not a complete reconciled food-cost schedule.
• Debt and taxes: Item 10 states that the franchisor does not offer or guarantee financing. Loan principal and personal income taxes are excluded; interest and depreciation may affect reported net income but are not separately modeled.

A buyer should replace the broad IRS margin with same-brand unit evidence whenever possible. The 2026 FDD states that written substantiation for Item 19 will be made available upon reasonable written request, and the FTC Franchise Rule Compliance Guide explains the framework for financial performance representations.

• Request the written substantiation for Item 19 and reconcile the 81 Designated Restaurants, the 33 exclusions, and each 2025 revenue statistic.
• Ask existing franchisees for recent unit-level profit-and-loss statements at sales levels near $633,185, $871,099, and $1,278,201.
• Separate business net income, owner payroll, owner draw, distributions, retained earnings, depreciation, interest, and capital expenditures.
• Document actual owner hours and identify what labor cost would be required if the owner were unavailable, even though a single-unit manager-run structure is not permitted by Item 15.
• Obtain written clarification of the Item 6 local-marketing floor discrepancy: $9,000 in the table versus $8,000 in Note 2.
• Verify current royalty, Brand Fund, software, supplier, delivery-platform, occupancy, and required local-marketing costs for the proposed territory.
• Interview current and former franchisees listed through Item 20, including owners involved in 2025 transfers, reacquisitions, and ceased operations, without assuming that every transfer represents failure.
• Model debt service separately using the buyer's actual loan amount, interest rate, term, and required working capital; do not subtract the Item 7 startup investment from one year of sales.