Why Subway Has Closed 900+ Stores This Year

Subway is in a downward spiral. 

The sandwich chain’s U.S. store count dropped by 909 locations in 2017, according to figures that a Subway representative provided to Business Insider. That represents more than 3% of the chain’s 2016 U.S. stores.

The chain currently has 25,835 shops open and operating in the U.S., according to the representative, compared to 26,744 at the end of 2016. 

In 2016, sales at the chain reportedly fell 1.7% and its store count dropped by 359 locations in the U.S. — marking the first time in the company’s history that the chain closed more stores than it opened.

Globally, Subway’s store count is down 471 locations. The chain has 44,014 shops around the world, down from its 44,485 stores in 2016.

The 909 shuttered U.S. locations this year could just be the tip of the iceberg for Subway closures.

Last week, news broke that franchisees were protesting the chain’s plan to bring back the $5 footlong deal. On Monday, Subway’s head of North American marketing, Karlin Linhardt, resigned from the company. And, traffic has fallen 25% over the last five years, according to an internal memo reviewed by The New York Post. 

“The national promotional focus over the past five years … has decimated [us] and left many franchisees unprofitable and even insolvent,” petitioners led by Virginia franchisee Mitesh Raval complained in a letter that was sent to Subway and obtained by The Post.

More than 400 franchisees have reportedly signed the petition, which protests the chain’s plans to roll out its famous $5 footlong deal in January.

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SOURCE: Kate Taylor
Business Insider