Each year, Forbes and Entrepreneur, two of the longest-running and highest-circulated publications in business journalism, publish their lists of the year’s best franchise opportunities for investors. This year, both magazines included Penn Station East Coast Subs.
For Forbes’s Best & Worst Franchises to Buy 2018 list, the publication partnered with franchise industry research firm FRANdata to analyze four years of data for more than 3,000 franchise brands, ranking each on five key metrics: system sustainability, system demand, value for investment, franchisor support and franchisor stability. Each of those metrics is rated independently and then combined into an overall rating for each brand. Based on that rubric, Penn Station ranked number ten in the Medium Investment category.
Entrepreneur’s 39th annual Franchise 500 ranking employed a similar methodology, breaking down their scoring into five categories: costs & fees, size & growth, support, brand strength and financial strength & stability. Of the 500 franchise brands that made Entrepreneur’s list, more than a quarter were in the foodservice segment, which is why the magazine released a separate list specifically for the segment, The Top 200 Food and Restaurant Franchises of 2018, in which Penn Station was ranked number eight in the Sandwich category.
According to Greg Goddard, Penn Station Director of Development and Franchising, the brand’s inclusion on both lists is a welcome acknowledgment of the work Penn Station does to support its owners.
“Inclusion on these lists is not something we are consciously working toward each year; everything we do from a franchisor perspective is aimed at strengthening our stores and supporting our franchisees,” Goddard said. “Fortunately, Forbes and Entrepreneur happen to be looking for the same things that we are focused on, and it’s encouraging to see the work we’re doing acknowledged by widely read and respected third parties.”
That third-party acknowledgment is more than just a pat on the back, Goddard says; it also provides substantial and actionable benefits for the franchise and its owners.
“The rankings have a real benefit in terms of franchise value and validation,” Goddard said. “Both magazines are authorities in the industry, and as new owner candidates consider our brand, that credibility goes a long way. More importantly, each of our stores across the country just got a value boost from the rankings. Lenders, realtors, everyone in our supply chain — they all see these lists too, which provides a lot of extra leverage for our owners in their own day-to-day negotiations and operations.”
According to Goddard, the rankings are also an encouraging sign that the franchise’s overall strategy is effective.
“Our strategy has always been to allow unit-level economics to drive growth,” he said. “One successful store leads to another, so we put all of our effort into ensuring the success of each store our owners open. We’ve been around for more than three decades, so we know that strategy is working for us, but the Forbes and Entrepreneur rankings prove that our strategy isn’t just working, it’s made us one of the strongest franchises in the industry.”
Goddard says he hopes to see Penn Station’s name on Forbes’s and Entrepreneur’s lists for years to come, but the franchise won’t be making any operational changes to ensure its inclusion.
“If we’re taking any lesson from this, it’s to stay the course,” Goddard said. “What we’re doing — what we’ve been doing for decades — is working. Forbes and Entrepreneur are two of the most prestigious and trustworthy names in our industry, and their validation is a strong endorsement of our business model and company culture.”