Subway franchise finance: how to fund a store in the UK

Subway franchise finance is the mix of personal funds and borrowing used to open a new Subway store, take over an existing one or add further stores in the UK. This guide is for prospective and existing franchisees who want to understand the costs and how lenders view them. Smart Funding Solutions is an independent broker, is not affiliated with Subway, and compares franchise lenders on its panel on your behalf. For franchise funding more generally, see our franchise loans page.

Subway sets minimum net worth and liquid funds requirements for applicants, and lenders expect a meaningful personal contribution alongside any borrowing. Fees and requirements change, so always confirm the current figures in Subway's UK franchise information and disclosure documents.

01What it costs to open a Subway

Subway's own published figures for the UK and Ireland, as at October 2026:

Most of the investment goes on equipment and conversion work, so the total moves with the size and location of the unit. Check the latest figures on Subway's UK franchising site before you build a plan around them. On a £180,000 store, a lender will usually expect a meaningful part to come from you, with the rest from a franchise loan and equipment finance.

Upfront costs

• The initial franchise fee
• Shop fit-out, signage and equipment
• Lease deposit, rent in advance and legal fees for the premises
• Opening stock and training costs
• Working capital for the first months of trading

Total investment varies considerably with location, unit size and whether the store is a new build, a non-traditional site (such as a forecourt or campus) or an existing store being resold.

Ongoing costs

• Royalty: a percentage of net turnover paid to the franchisor
• Advertising fund contribution: also a percentage of turnover
• Rent, business rates, staff, stock, utilities and maintenance

Because royalties and advertising fees are based on turnover rather than profit, they must be paid even in quiet months. Build them into your cash flow forecast from day one.

02New store vs buying an existing store

03Financing options

Franchise loans from banks and specialist lenders

Many UK banks and lenders have franchise teams that look favourably on established brands with proven systems. They will typically fund part of the set-up cost, with the rest coming from you.

Government-backed lending

The British Business Bank's Growth Guarantee Scheme gives accredited lenders a government guarantee on part of a loan, which can help businesses that would otherwise struggle to borrow. The borrower remains fully liable for the debt. The Start Up Loans programme may help new business owners. Check the British Business Bank for current availability, and see our Growth Guarantee Scheme guide.

Asset finance for equipment and fit-out

Ovens, refrigeration, counters and point-of-sale systems can often be funded through hire purchase or leasing, reducing the cash you need upfront. Read about commercial kitchen equipment finance.

Unsecured and secured business loans

Once trading, franchisees may use unsecured business loans for refurbishments or working capital, or secured loans if they have property to offer.

04Your personal contribution and investors

Lenders want to see that you have your own money at stake. Your contribution can come from savings, equity in property or, in some cases, a business partner. Keep a cash reserve for unexpected costs rather than putting every penny into the set-up.

If you bring in an investor or partner, agree in writing how profits, decisions and any exit will work, and check that the franchisor approves the ownership structure.

05What lenders look at

• The size and source of your personal contribution
• Personal credit history and net worth
• Management, retail or food-service experience
• The proposed site: footfall, competition and lease terms
• A business plan with a realistic cash flow forecast, including royalties and advertising fees
• For an existing store, its actual trading history

06How much is a Subway franchise in the UK?

A new Subway franchise in the UK costs from around £180,000 in total, according to Subway's UK franchising FAQs, with an initial franchise fee of £15,000 for a new agreement. Subway says most of the cost is equipment and conversion work, so the figure rises or falls with the size and location of the unit.

What drives the cost of a new store

• The unit: conversion work depends on the condition and layout of the premises, and on what the landlord provides.
• Equipment and furniture: ovens, refrigeration, counters and seating make up much of the total.
• Location: rent, deposits and legal fees vary sharply between high streets, retail parks and non-traditional sites.
• Training time: Subway describes three weeks of franchise partner training, two of them in a certified training restaurant, so allow for time away from other income.

Buying an existing Subway store

The price of an existing store is agreed between the seller and the buyer, and Subway has no say in it, although it must still approve the transfer. Lenders will value the deal on the store's actual trading figures rather than the new-store estimate.

What you pay Subway once open

Royalty of 8% of net turnover plus an advertising fee of 4.5% means 12.5% of sales goes back to the franchise system before rent, staff and stock. That is why lenders test your forecast in quiet months, not just busy ones.

Your own money usually covers part of the cost, with the balance from a franchise loan and equipment on asset finance. We compare franchise lenders on our panel once you have Subway's current figures for your site.

07How to prepare

It is free to enquire, and any broker fee is disclosed separately before you proceed. For comparison with another quick-service brand, see our McDonald's franchise finance guide, or apply online when you have the franchisor's figures.

08Subway franchise costs: worked examples

These examples apply Subway's published figures to round numbers so you can see what they mean in pounds. They are arithmetic, not Subway or lender figures.

How a £180,000 store might be funded

Lenders set the contribution they want case by case, so treat these rows as illustrations, not requirements. The borrowing is often split between a franchise loan and asset finance for equipment and fit-out.

What 12.5% of sales means in pounds

The sales levels are illustrations, not Subway figures, and the table assumes both fees are charged on the same net sales. Subway's FAQs do not publish turnover or profit figures, so a lender will judge your forecast on the site, the lease and your experience. These fees are paid before rent, wages and stock, which is why lenders test the forecast in quiet months.