--- title: "Firehouse Subs Adjusts Development Playbook Amid Cost Pressures" url: https://burnaze.com/article/8f6485f2-4b55-49c0-af80-4c3ca40e760c source: "QSR Magazine" original_url: https://www.qsrmagazine.com/story/firehouse-subs-adjusts-development-playbook-amid-cost-pressures/ author: "Ben Coley" category: "Sandwich & sub" industry: "Restaurants" segment: "Sandwich & sub" published: 2026-04-29T10:24:09.000Z modified: 2026-10-31T13:18:50.924Z image: https://www.qsrmagazine.com/wp-content/uploads/2026/04/FirehouseSubsEXT.jpg --- # Firehouse Subs Adjusts Development Playbook Amid Cost Pressures **TL;DR:** Firehouse Subs has introduced new financial incentive programs to help franchise operators combat rising construction costs and support North American expansion. The brand's incentives include upfront cash and tiered offerings for single-unit operators, multi-unit developers, and experienced franchisees. *By Ben Coley, originally published in QSR Magazine on 2026-04-29. [Read the original](https://www.qsrmagazine.com/story/firehouse-subs-adjusts-development-playbook-amid-cost-pressures/).* ## Story The brand’s latest development incentive programs, which offer upfront cash to franchisees, come out of several years of adjustment following increases in construction costs and a push to expand its footprint across North America. The incentives have continued to evolve alongside both franchisee needs and macroeconomic market conditions. Today’s version includes tiered offerings for single-unit operators, multi-unit developers, and experienced franchisees looking to scale quickly, as well as targeted programs tied to priority markets. Here are the current incentive guidelines: - **10 in 2 Incentive:** $100,000 per restaurant opening for franchisees who develop at least 10 restaurants during 2027 and 2028, plus a potential $500,000 achievement bonus incentive following the 10th opening. - **Grow A-Gain Incentive:** $150,000 per restaurant opening for operators who have a grade of “A” under Firehouse’s current operational metrics, who have not opened a location in five or more years, and develop at least two new restaurants by December 31, 2028. - **Accelerated Market Incentive:** $150,000 per restaurant opening, plus a 2 percent royalty rate reduction for three years for franchisees who develop at least three restaurants in priority markets, including New York; Los Angeles; Chicago; Boston; Philadelphia; Seattle; Washington, D.C.; Minneapolis; San Diego; Detroit; Indianapolis; and Providence, Rhode Island. The structure builds on a program first introduced in 2023, when the company began working directly with franchisees to understand what was slowing development. The answer pointed to capital, not royalties. “We asked our franchisees, ‘What do you guys need to grow faster?'” says Kelly Crummer, senior director of franchising. Operators pointed to rising build expenses as the main constraint. That feedback led to a shift in how incentives were structured, moving away from traditional relief tied to royalties or marketing funds. “We designed our program to be that upfront cash to essentially partner with them in the cost of building new locations,” she says. The approach has coincided with a period of growth. Firehouse is coming off its strongest net restaurant expansion in more than a decade, according to Crummer. The fast casual finished 2025 with 1,276 U.S. restaurants, net growth of 47 units year-over-year. It also earned $1.2 billion in U.S. systemwide sales, and posted a $960,000 AUV. Franchisee profitability per unit increased to over $100,000, up from $90,000 in 2024. The industry veteran attributes several factors to successful expansion and unit economics, including product strength, operational consistency, and franchisee engagement. “We have a great product… a proven business model with over 32 years of experience,” Crummer says. To evaluate new operators, Firehouse works across a range of ownership profiles, from first-time business owners to experienced multi-unit operators, but looks for a consistent set of traits. The ability to build teams and scale operations is key. So is a willingness to follow established systems and engage with the brand’s community-driven approach. “We’re looking for people who want to serve their local areas, not only in serving sandwiches, but also helping us… fundraise and make grants for life-saving equipment,” Crummer says. That flexibility in ownership profiles has helped support expansion across different markets. In many of these trade areas, the chain already has a presence, but not enough density to meet demand. “Our guests also tell us that we’re not convenient because there’s not enough locations close to them,” Crummer says. The demand creates an opening for franchisees willing to develop additional locations. The incentive programs are structured to encourage that kind of growth, particularly among operators with the capacity to build multiple units. The construction environment remains a key factor in how those decisions are made. According to Crummer, restaurants that used to cost $300,000 are now up to $500,000 to build. So in addition to incentives, Firehouse has taken steps to reduce build costs and improve returns, such as pivoting from a newer design that was more expensive and going back to its legacy image. The process included reviewing each component of the build, like materials and equipment sourcing. In some cases, that meant replacing imported materials with domestic alternatives or leveraging vendor relationships across parent company Restaurant Brand International’s network. Firehouse also shrunk its square footage. It’s targeting 1,400 to 1,500 square feet, compared to previous iterations that are over 2,000 square feet. The chain has built urban locations as small as 800 square feet. Along with the U.S., Canada has become an expanding market for Firehouse. The brand has grown from about 60 locations in one province to more than 150 restaurants across multiple regions in a relatively short time. Crummer says much of the awareness comes from Canadian customers who tried Firehouse in the U.S. “We get guests that from Canada that came down to the U.S. and they’re like, ‘When are you coming to my neighborhood?’ she says. Across North America, agreements are balanced between new and existing franchisees, with a slight tilt toward new ones in the U.S. specifically. And now these franchisees have the backing to make a bigger impact in the years to come. “The incentives were really meant to bridge that gap… so that the payback and the ROI could truly be best-in-class that that we expected,” Crummer says. ## Entities - unit expansion (topic) - QSR (sector) - franchise development (topic) - QSR Magazine (publication) - canada (location) - United States (location) - Ben Coley (person) - Firehouse Subs (company) - Kelly Crummer (person) - north american expansion (topic) - incentive programs (topic) - construction costs (topic) --- Originally reported by Ben Coley, QSR Magazine (https://www.qsrmagazine.com/story/firehouse-subs-adjusts-development-playbook-amid-cost-pressures/). Summarized by Burnaze (https://burnaze.com/article/8f6485f2-4b55-49c0-af80-4c3ca40e760c).