Sandwiches and Gas Pumps

When RaceTrac announced its $566 million all-cash acquisition of Potbelly, headlines framed it as a convenience store buying a sandwich chain. That’s true—but it misses the point. The real asset in play isn’t toasted subs. It’s prime locations.

Potbelly has long promised growth, with ambitions of reaching 2,000 units from its current 445. But franchisees need sites, and real estate is where the math has always broken down. RaceTrac, meanwhile, controls more than 800 high-traffic convenience store sites across 14 states. Together, the combination isn’t just about cross-selling snacks with sandwiches—it’s about fast-tracking Potbelly’s expansion without fighting for leases in crowded retail corridors.

RaceTrac now has a proven fast-casual brand it can co-locate inside or alongside its existing footprint, instantly lowering barriers to growth. For Potbelly, the partnership turns a dream of scale into something logistically feasible. This isn’t diversification—it’s vertical integration of real estate and restaurant expansion.

Other convenience giants like Wawa and Sheetz have built their own proprietary food brands over decades. RaceTrac just shortcut that process by buying one. If the experiment works, it sets a new precedent: chains struggling to scale may find their fastest path isn’t Wall Street, but Main Street landlords who already own the corner.

And this isn’t happening in a vacuum. The sandwich category in particular has been a hotbed of deal activity. Inspire Brands snapped up Jimmy John’s. Restaurant Brands International added Firehouse Subs to its roster. Even Subway—the giant of the sector—has been shopping for buyers, with private equity circling as valuations climbed. Potbelly now joins that wave, signaling that midsized sandwich chains are increasingly becoming targets for bigger players looking to consolidate the category.

Beyond sandwiches, consolidation has been the name of the game across fast casual. FAT Brands has gone on a buying spree, adding everything from Twin Peaks to Fazoli’s. JAB Holding has continued to build its bakery-café empire. These deals highlight a broader truth: for many restaurant concepts, the future isn’t independence—it’s finding the right partner with capital, infrastructure, and distribution muscle to scale what already works.

We’ve seen this play before. When Home Depot acquired GMS earlier this year (click here to read that article), it wasn’t about drywall—it was about owning the supply chain backbone that makes scaling easier. RaceTrac’s Potbelly move follows the same logic. It’s not just buying a sandwich shop; it’s acquiring a growth engine it can drop into its existing footprint. In both cases, the smarter dealmakers are asking: what asset unlocks leverage across everything else we already own?

The Potbelly–RaceTrac deal is less about sandwiches and more about square footage. For business owners, the lesson is clear: sometimes the fastest growth lever isn’t product or marketing—it’s distribution. Own the right locations, and you control the board.

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