Podcast Summary: Making It with Jon Davids

Episode 225: "This is the Worst Franchise To Own"

Guest: Gregg Majewski (CEO, Craveworthy Brands; former CEO, Jimmy John’s)
Date: October 31, 2025

Episode Overview

In this episode, Jon Davids sits down with Gregg Majewski to break down the world of restaurant franchising: its gold standards, biggest failures, success secrets, multi-brand strategies, and the evolving delivery landscape. Drawing on his experience with Craveworthy Brands and Jimmy John’s, Majewski shares candid insights on why certain franchises thrive, why others bomb spectacularly, and how to truly set up franchisees for lasting success.

Key Discussion Points & Insights

1. The “Gold Standard” in Franchising

[00:12 - 01:35]

• Chick-fil-A stands out for tight operational control, selectiveness, and protecting franchisee investment.

  • Only allows one store per owner to maintain focus and brand quality.
  • "They're doing $9.2 million a store... they've done everything right." (Gregg Majewski, 00:27)

• Jimmy John’s succeeded by recruiting dedicated first-timers, reinforcing brand DNA, and enabling significant profits.

  • Some operators grew from a single store (all-in with their net worth) to owning 30-40 stores.
  • “They were seeing 25, 30% profit back in the day... We created these one stores to now some of them have 30, 40 restaurants today.” (Gregg Majewski, 00:40)

• Cautionary Tales:

  • BurgerIM: Complete disregard for franchisees; legal issues and industry blacklisting.
  • "That guy completely didn’t care about his franchisees... can never sell another franchise in any industry..." (Gregg Majewski, 01:25)

2. Franchise Failures: The Case of Quiznos

[01:35 - 02:11]

• Quiznos’ downfall: Over-leveraged franchisees; franchise company became the bank; slow service model in a market obsessed with speed.
  • "We could produce a sandwich in 15 seconds... You stood there, you know, twiddling your thumbs in a Quiznos back in the day for four or five minutes..." (Gregg Majewski, 01:47)
• Franchise greed was a root problem: "Their franchise group got a little greedy. They became the bank." (Gregg Majewski, 02:08)

3. The Subway Model: “Buying a Job”

[02:11 - 03:27]

• Subway’s scale (over 37,000 locations) is based on low profit margins and oversaturating markets.
  • Most franchisees bought themselves “a job” rather than a high-return business—making modest incomes ($30K–$40K/year).
  • "Why would you ever compete? But yet they had a niche... The franchisee did not [make money]." (Gregg Majewski, 02:37)
• Protected Territories: Contrast to Subway, Majewski prioritizes exclusive territories for franchisees to prevent cannibalization and preserve sales.
  • “I don’t put stores on top of each other... I’ll lose sales on my side so my franchisee has more sales.” (Gregg Majewski, 03:10)
• Subway’s operational model saturates urban areas, reducing store-level volume and profit.

4. Craveworthy’s Multi-Brand Strategy

[03:27 - 06:16]

• Craveworthy Brands portfolio: Includes Genghis Grill, BD’s Mongolian Flat Top Grill, Tsum Tsum Mediterranean Crafted Burger and Bar, Wing It On, Budlong Southern Chicken, and virtual brands under “Craveworthy Kitchen.”

  • Virtual brands can add $200K–$300K in incremental revenue per restaurant.
  • "Each one of our brands has three unique virtual brands that go with it... add another 2 to 300,000 in incremental top-line revenue." (Gregg Majewski, 03:54)

• Virtual/ghost kitchen model: Multiple brands run out of a single physical location (for both delivery and in-store sales).

  • "You can actually come into Genghis and order Lucky Cat while you're sitting in Genghis." (Gregg Majewski, 05:13)

• Operational efficiency: Franchisees focus on food execution; Craveworthy HQ handles all marketing and brand management.

  • "We do all that. They don’t do any of that... Their kitchen, when an order comes in, it’s just another item that they have to make." (Gregg Majewski, 06:02)

• Benefits outweigh complexity: More brands = more franchisee profit, supporting expansion.

  • "If my franchisees are winning, that means I win... If they're more profitable, that's going to lead them to opening up another store..." (Gregg Majewski, 06:25)

5. Changing Delivery Ecosystem: DoorDash, Grubhub, and the “Necessary Evil”

[06:45 - 08:49]

• Third-party delivery apps helped restaurants survive COVID but now impose heavy fees (~20%); Majewski predicts fees must decrease for long-term sustainability.

  • "They're a necessary evil... The consumer has changed... their fees are going to have to drop..." (Gregg Majewski, 07:05)

• Consumer behavior: Younger generations will pay disproportionate delivery fees for convenience.

  • "Kids, especially this younger generation, will order a 99-cent burger from McDonald's, pay a $7 delivery fee and now have an $8 burger. It's extremely stupid, but at the same time it's what has been built into our DNA." (Gregg Majewski, 07:13)

• The future of delivery:

  • Restaurants will reclaim delivery to protect brand and in-house quality.
  • "Restaurants are going to go back to wanting their food to be king..." (Gregg Majewski, 08:12)
  • Domino’s and Jimmy John’s cited as gold standards for in-house, controlled delivery.

6. The High Failure Rate of Restaurants

[08:49 - 09:40]

• Myth vs. Reality:

  • Independents fail at high rates due to lack of experience and operational rigor.
  • Franchise concepts offer lower failure rates: "If you go and become a franchisee of a concept, your chance of success is not even remotely what that other figure is, but independent struggle..." (Gregg Majewski, 09:05)
  • Many people naively enter the business believing home cooking skill translates to restaurant success.

• Key to Success:

  • Operational discipline and proven systems are crucial.
  • "It's not easy, but it is easy to fix if you put the operations in the right spot." (Gregg Majewski, 09:33)

Notable Quotes

• “They wanted the service, right? They wanted the brand protected. And because of that they won big. Now they're doing $9.2 million a store.” (Gregg Majewski, 00:22)
• “BurgerIM was the biggest one in the industry. That just happened where that guy completely didn’t care about his franchisees at all...” (Gregg Majewski, 01:18)
• “We could produce a sandwich in 15 seconds. And you stood there... in a Quiznos back in the day for four or five minutes...” (Gregg Majewski, 01:47)
• “Subway built their model on buying a job.” (Gregg Majewski, 02:23)
• “All they do is become more profitable. And if they’re more profitable, that’s going to lead them to opening up another store.” (Gregg Majewski, 06:33)
• “They’re a necessary evil now because the consumer has changed the way that they eat... But they're not going anywhere.” (Gregg Majewski, 07:09)
• “There's so many that think, oh, I cook at home. I cook these great meals. I can do this no problem. And then they realize they can't.” (Gregg Majewski, 09:19)

Timestamps for Important Segments

• [00:12] Gold Standard Franchises & Franchisee Success Stories
• [01:35] What Went Wrong at Quiznos
• [02:11] The Subway Franchise Model & Profitability
• [03:38] Craveworthy's Portfolio & Virtual Brands Model
• [05:07] How Virtual Brands Work Operationally
• [06:45] The Role & Future of Third-Party Delivery Apps
• [08:49] Why Restaurants Fail—and How Franchises Avoid It

Tone & Language

Gregg Majewski is candid, direct, and sometimes irreverent—as when describing “stupid” delivery behavior—but deeply focused on operations, franchisee success, and practical realities of the business. Jon Davids asks pointed, insightful questions to keep the pacing swift and informative.

Bottom Line:
This episode delivers a reality check on what makes franchises (and their owners) succeed or fail, the perils of oversaturated markets, how to use multi-branding/virtual concepts to bolster profitability, and why discipline trumps dreams in the restaurant game.