In its most recent revamp, the company has put some effort into making the experience of eating at a Subway feel more modern and health conscious. Its menu continues to get regularly updated with new offerings; it recently introduced wraps, but its menu of snacks includes a strange, very unwieldy-looking footlong cookie, as well as a footlong churro. Its redesigned stores — which it practically ordered franchisees to foot the bill for, although it did offer some $10,000 remodeling grants back in 2019 — have also adopted a more millennial aesthetic of decor, featuring bright green accent walls and digital kiosks. Unfortunately, only about half of its 20,000 locations have been updated. In addition, Subway reportedly spent about $80 million on the new meat slicers, which some franchisees complain aren’t driving sales.
Why do all the world’s best athletes do Subway commercials?
The glitzy campaign, featuring stars like Patrick Mahomes, Simone Biles, and Travis Kelce, is part of an aggressive effort to fix its deep-seated problems.
Subway’s uncertain private equity future
For a long time, Subway was the biggest name in the sandwich game, but it occupies a strange place in the world of fast food now. There are a lot of sandwich chains these days offering high-quality subs, including Jimmy John’s, Jersey Mike’s, and Firehouse Subs. Subway’s brand perception has taken a bit of a tumble in recent years, especially compared to the early 2010s. According to YouGov, under a third of consumers said that they would consider eating at Subway post-pandemic. The same YouGov reports does note that its latest ads do seem to have helped somewhat, though not to the pre-pandemic levels of popularity.
It’s unclear how well Subway’s play to shrink itself will pan out. Its sales are improving, but still haven’t fully caught back up to the early 2010s levels. The biggest point of optimism, according to experts, might just be that the chain was recently bought by private equity firm Roark Capital for an eyebrow-raising $9.5 billion. The fact that Roark paid such a high price shows that they still saw a lot of value in the Subway name. Under Roark, it’s now part of a family of chains that include Auntie Anne’s, Dunkin’, Buffalo Wild Wings, and many more, including sandwich rival Jimmy John’s.
While private equity-owned restaurant chains have been in the news lately in light of Red Lobster’s bankruptcy, “franchisees were absolutely on board with the sale to Roark Capital,” Maze says. Thomas was also happy to see the sale to Roark, but believes that for Subway to really recover, it needs to pick what it’s going to stand for. Is it for health? Is it for value? Is it something else? The menu and store experience could still use more improvement.
Maze’s verdict is that it’s been a very bumpy road for Subway, but it’s doing better than it used to. That’s actually kind of high praise. “Jesus himself would probably need a couple of years to have fixed Subway from the problems it had created for itself,” he says.