Potbelly Sandwich Works Expands into Georgia Market

News Summary

Potbelly Sandwich Works has announced its entry into the Georgia market through a development agreement with Royal Restaurant Group. This partnership includes plans for 15 Potbelly locations in the Atlanta area, with construction starting in January 2026. Potbelly aims to franchise 85% of its stores and is on a growth trajectory, expecting to reach 2,000 locations nationwide. Despite recent challenges in same-store sales, the company is focusing on value offerings to attract consumers.

Atlanta, Georgia – Potbelly Sandwich Works has announced its first entry into the Georgia market by signing a development agreement with the franchise partner Royal Restaurant Group. The agreement includes plans for 15 Potbelly shops set to open in the Atlanta area, focusing on parts of Fulton and DeKalb counties.

Construction and development in Georgia are slated to start in January 2026, with an ambitious plan to open three new shops each subsequent year. This development partnership is part of Potbelly’s broader nationwide goal to expand its footprint to 2,000 locations by increasing its franchise system, where approximately 85% of its stores will be franchised.

In addition to its Georgia expansion, the Royal Restaurant Group is responsible for managing 36 Potbelly locations throughout Florida and Ohio. This aligns with Potbelly’s strategy to accelerate growth across different states.

As of the end of the most recent quarter, Potbelly operates about 430 locations in the United States. The company’s growth trajectory saw an increase to 435 shops at the end of Q3 2023. During that quarter alone, eight new locations were opened, contributing to Potbelly’s year-to-date total of 15 new shops, with forecasts suggesting that 24 to 26 openings may occur by year’s end.

According to industry projections, Potbelly is expecting 2024 to be the best year for unit growth since 2017. The current report indicates that approximately 260 signed development agreements are in place, awaiting completion. It is estimated that 22% of these franchise shops will reflect the overall franchise system.

Despite the positive expansion news, Potbelly has faced some challenges in same-store sales, which fell by 1.8% at company-operated stores during the latest quarter. In response to competitive market pressures, the company is focusing on value offerings in its menu, like the new $7.99 Skinny combo. This meal deal is designed to attract consumers searching for affordable dining options and will remain a permanent feature on the menu rather than a temporary promotion.

Royal Restaurant Group’s leadership has expressed enthusiasm about the potential for success with the new shops in the Atlanta area. Potbelly’s menu is known for offering a variety of sandwiches, salads, shakes, and cookies, with options tailored to local tastes and preferences.

In addition to Georgia, Potbelly has set its sights on expanding into several other markets across the U.S., including Florida, Tennessee, Texas, Ohio, Virginia, and Pennsylvania, reflecting a strategic focus on growth in diverse geographical areas.

Potbelly Sandwich Works began its operations in 1977 with its first shop in Chicago and has since developed into a widely recognized brand known for its signature offerings. The recent moves to develop in Georgia are a part of a larger strategy to enhance its market presence and adapt to changing consumer demands in various new regions.

The recent development agreements showcase Potbelly’s commitment to achieving its growth target while addressing market demands and navigating sales challenges. With a firm development plan laid out in collaboration with the Royal Restaurant Group, Potbelly is poised for significant expansion in the eastern United States.

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