Erbert & Gerbert Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$39,500 - $460,270
Franchise Fee
$5,000
Total US Locations
64
Business Summary
Erbert & Gerbert's Sandwich Shop franchises restaurants that specialize in gourmet sandwiches and specialty soups. These restaurants serve customers on-site, through drive-through, and offer pick-up or delivery services. Erbert & Gerbert's Sandwich Shop operates in both Traditional Locations (like strip centers) and Non-Traditional Locations (such as shopping mall food courts, educational facilities, or transportation hubs).
Corporate History
E & G Franchise Systems, Inc. began operating a business similar to the franchised concept in 1988, eventually incorporating in Wisconsin in 1991 under the name Erbert & Gerbert & Friends, Inc. The company changed its name to E & G Franchise Systems, Inc. in 2002. Erbert & Gerbert's Sandwich Shop started offering franchises for Traditional Locations in 1992. Between 2011 and 2015, it offered franchises for Non-Traditional Locations under the 'E & G Bistro' and 'Erbert and Gerbert's Bistro' marks, but consolidated these offerings under the main Erbert & Gerbert's brand in a single disclosure document starting in 2016.
Financial Overview
Investment Range
$39,500 - $460,270
Franchise Fee (Low)
$5,000
Franchise Fee (High)
$30,000
Royalty %
6%
Marketing %
2%
Equipment Costs (Low)
$24,250
Equipment Costs (High)
$179,070
Working Capital
$22,500
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Erbert & Gerbert's Sandwich Shop has audited financial statements that show positive net income for both 2022 and 2023, along with healthy stockholders' equity and cash reserves. The auditors provided an unqualified opinion, indicating that the financial statements present fairly the company's financial position without any substantial doubt about its ability to continue as a going concern.
Financing Details
Erbert & Gerbert's Sandwich Shop does not offer any direct or indirect financing to its franchisees. Additionally, the franchisor does not guarantee any notes, leases, or other obligations for franchisees.
Performance Metrics
Total US Locations
64
Franchised Units
60
Corporate Units
4
Avg Square Footage
1,800
Franchising Since
1992
Legal & Compliance Analysis
Recent Litigation
Yes
Bankruptcy
No
Litigation Count
2
Litigation Summary
Erbert & Gerbert's Sandwich Shop has disclosed two litigation cases. The first case involved an arbitration filed in January 2019 by a franchisee, Keepin' It Food, LLC, alleging misrepresentation regarding franchise location, buildout costs, cost of goods sold, and support, as well as breach of contract. This case was amicably resolved and dismissed on March 11, 2022, with Erbert & Gerbert's Sandwich Shop paying the claimant $50,000. The second case was a lawsuit filed by Erbert & Gerbert's Sandwich Shop in May 2018 against a franchisee, The Janik Group, LLC, and its owner, after terminating their franchise agreement and the franchisee continued operating under the brand. The lawsuit was later amended to include violations of post-termination non-competition obligations. This case was settled and dismissed in March 2019, with Erbert & Gerbert's Sandwich Shop purchasing the franchisee's development territory for $77,500.
Bankruptcy History
Erbert & Gerbert's Sandwich Shop has no bankruptcy history to report.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew their franchise agreement, Erbert & Gerbert's Sandwich Shop franchisees must provide written notice between 180 and 270 days before the Initial Term ends. They must be in full compliance with the current franchise agreement, pay a renewal fee of $5,000, sign the then-current franchise agreement (which may have different terms), upgrade their business premises to meet current decor standards, and execute a general legal release.
Training & Support Program
Franchisor Assistance
Before opening, Erbert & Gerbert's Sandwich Shop assists franchisees with site approval, provides guidelines for layout and design, and offers approved suppliers or specifications for necessary products and services. The franchisor provides initial training for the Principal Owner or designated manager (up to 15 days for Traditional, 5 days for Non-Traditional) and loans a confidential operations manual. At the time of opening, franchisees receive on-site assistance from at least one person for up to 5 days. Ongoing support includes continuing advisory assistance (which may incur a fee), continued access to the manual, and the ability to purchase certain branded products directly or through approved suppliers. Erbert & Gerbert's Sandwich Shop manages an Advertising Fund (with contributions of 2% of Net Revenues for Traditional locations and a one-time $750 fee for Non-Traditional locations) for advertising and promotional activities, and may establish local advertising groups. Franchisees must use designated computer systems (Office, POS, Online Ordering, Loyalty Systems) for which ongoing software maintenance and support fees apply.
Initial Training Hours
153
Training Location
West St. Paul, MN, Rochester, MN, Eau Claire, WI, or Minneapolis, MN
Ongoing Support
After opening, Erbert & Gerbert's Sandwich Shop provides continuing advisory assistance, for which a reasonable fee may be charged. Franchisees continue to have access to the confidential operations manual and can purchase certain furniture, fixtures, and branded products from the franchisor or its affiliates. The franchisor administers an Advertising Fund (receiving 2% of Net Revenues from Traditional locations) for marketing and promotional activities and may establish Local Advertising Groups for Traditional franchisees. Erbert & Gerbert's Sandwich Shop provides marketing plans and materials (for a reasonable fee) and maintains a website with guidelines for social media. Franchisees are required to use a designated Computer System (including Office, POS, Online Ordering, and Loyalty Systems) with ongoing software maintenance and support fees, estimated at $8,000 to $9,500 per year for Traditional locations. The franchisor may also require periodic hardware and software upgrades.
Franchise Requirements
Industry Experience Required
No
Management Experience Required
No
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
retail
Owner Participation
Hands-On
Territory Type
Limited
Territory Size Requirements
Erbert & Gerbert's Sandwich Shop's Assigned Territory for a Traditional Location is typically a 3 to 5-minute service radius around the franchised business, which can vary in mileage depending on whether the area is rural or densely populated. For Non-Traditional Locations, the Assigned Territory is limited to the specific terminal, food court, or building where the franchised location operates.
Staffing Notes
Erbert & Gerbert's Sandwich Shop requires franchisees to maintain a competent, conscientious, and trained staff, with the franchisee being solely responsible for all employment decisions including hiring, firing, and training. For Traditional Locations, the Principal Owner or a designated manager (who must complete initial training and, unless approved otherwise, hold at least a 5% beneficial interest in the business) must directly supervise daily operations. Franchisees with three or more Erbert & Gerbert's Restaurants must also hire a district manager to oversee operations alongside the Principal Owner. For Non-Traditional Locations, a Key Operator who completes initial training manages the business, and does not need to hold an equity interest. All supervisory personnel, including Key Operators, are required to sign a confidentiality and non-competition agreement.