Subway has called an emergency meeting with franchisees who run its 19,000 restaurants amid falling sales and profits.
The sandwich chain, which has more locations than McDonald’s but much lower sales, will reveal plans to attract more customers, such as offers and new products.
Fast food chains have all suffered over the past year as Americans, tired of inflation, have eaten out much less. McDonald’s, Burger King and Wendy’s have all launched $5 menu deals.
But Subway has been particularly hard hit, with sales down 9% amid complaints about huge price increases and lacklustre store appearances. And it has yet to launch a competitive national offering like its rivals.
“Maybe Subway is calling an emergency meeting because no one wants to pay $12 for a mediocre sandwich they can make for $3 at home,” wrote Douglas Boneparth, president of Bone Fide Wealth in X.
“I paid almost $20 for a 12-inch sandwich with fries and a drink at Subway the other day. It’s cheaper to go to Publix and the sandwich is better,” one consumer wrote in agreement.
Subway Gas called its franchisees to a last-minute meeting to discuss sales and traffic
Consumers have complained about rising prices for Subway sandwiches
Others lamented the sharp rise in prices in recent years, while others complained about quality.
“I’m old enough to remember the glory days of the $5, 12-inch burger. And they were glorious,” one commented on Boneparth’s post.
“You mean you don’t want razor-thin meat that’s been soaking in water for who knows how long and bread that’s part of a yoga mat for $12-15?” another asked.
An invitation from the company sent to local shop owners says the corporation will explain plans to win back customers and increase its faltering market share.
“This conference is essential,” said the invitation obtained by The Post.
‘Join us…to discuss the state of the industry and an update on our business.’
The invitation, sent last week, will remind franchisees of promotional offers being tested.
Some store franchisees have criticised the “crazy” discounts being pushed when traffic has dropped.
“They’re doing crazy coupons,” they told the Post.
‘Our gross sales are not even at 2012 levels, and profits then were five times what they are today.’
“They charge $6.99 for any sandwich while they’re $11 on the menu,” they complained about a recent deal.
Subway does not provide overall sales data, but its eastern U.S. region, with about 1,000 square meters, saw sales drop 8.7 percent between June 25 and July 16 compared with a year earlier. The New York Post reported.
A spokesperson for the chain denied the conference was an emergency and instead insisted that “we are constantly and proactively communicating with our franchisees to share updates and business plans.”
Some franchisees say “crazy” promotions are not good for their business
McDonald’s introduced a $5 meal deal earlier this summer in an attempt to offer value.
All Subway locations are franchised and the company receives an 8 percent royalty from the owners.
In April, the company was sold for $9 billion to Roark Capital, which also owns Dunkin Donuts, Arby’s and Baskin Robins.
It now faces stiff interest payments on its debt and cannot afford to see its revenue decline, sources told the Post.
Subway joins a host of other fast-casual and convenience food chains that are pushing value offerings in a bid to boost sales from discerning consumers after years of price increases.
From Wendy, Burger KingStarbucks, Popeyes and Taco Bell have also recently launched deals, all of them recent. Rated for value by experts.
