Business plan

Subway is closing stores and adding new menu items as part of business plan overhaul

Subway has a new recipe for success: fewer stores and a bigger menu.

In early July, the 57-year-old sandwich chain introduced the Subway Series, a menu of 12 chef-made sandwiches that can be ordered by name or number, like The Monster, which includes steak, bacon, cheddar, green peppers and onions on Italian bread with ranch dressing.

It’s a big change for Subway, which is known for letting customers create their own sandwiches. Trevor Haynes, Subway’s president of North America, said the company felt the need to simplify after a growing amount of digital ordering data showed that 50% of customers were still building the same sandwich.

Haynes said the new sandwiches — selected from hundreds of options — also highlight Subway’s improved ingredients, which arrived in US stores last summer. This change helped Subway – which is a private company – achieve record sales in 2021.

It’s all part of a much-needed refresh for Milford, Connecticut-based Subway, which has been losing market share to fast-growing rivals like Panera and Firehouse Subs. Subway controlled 28% of the U.S. sandwich and deli market in 2021, up from 34% in 2017, according to Technomic.

Haynes, who joined Subway in 2006 in his native Australia, spoke to The Associated Press about the changes at the chain. His answers have been edited for length.

Q What motivated the adoption of the Subway Series menu?

A. We tested it extensively in several markets across the United States. Franchisees have found this to be a great way for customers to browse the restaurant without having any questions. It was just easier for the guest and easier for the sandwich artist to make the sandwich. Now, of course, if you want to have a turkey sandwich and want to load it up with whatever you want, you absolutely can. We do not remove personalization. He is always there. But today’s guest told us he wanted us to change. They want us to make it easy for them.

Q Subway had its best selling week since 2013 last year when it introduced its upgraded ingredients. How did the word get out so fast?

A. Franchisees quickly became very confident. They started seeing how their guests reacted when their friends and family came in and tried it. And that’s a big part of it. In a franchise system, you need franchisees to believe in it, to commit to it, and to want it. This year, in May and June, we have broken that record two or three times since. And when we launched this program, we put a lot of effort behind the media. We had Tom Brady, we had Serena Williams, we had Megan Rapinoe, Steph Curry, all-star roster. And that encouraged franchisees to sit up and say, “Hey, we’re a big brand. These are big names. I better be behind this.

Q Subway has closed more than 5,100 stores in the United States since 2017, and yet the company is posting record sales. Why?

A. I think when you look at the portfolio, where we may have had locations for 30 or 40 years, the trading areas change. What was the best mall in town 30 years ago may not be the best mall in town today. The general retail landscape in the United States is changing dramatically, so we’ve moved locations and reconfigured markets. There might be markets where we had three restaurants and we’ve reconfigured into one or two, but that or those two have drive-thru or more floor space. Before, we were very focused only on the number of restaurants. Today, we are very focused on the type of restaurant that we have and are really working with franchisees to move from some of these older locations to newer, more dynamic retail areas.

Q You worked for Subway in Australia and the UK before coming to the US. How do you think the experience abroad influences your work?

A. It gives you a different sense of, you know, just being more open to new ideas or different ways of thinking, having met people from very different backgrounds. I think it was very helpful. You understand what works well in Subway and what doesn’t work well in Subway. I think having that international experience just gives you a different way of seeing and maybe a bit more of a broader perspective.

Q What’s your favorite sandwich from the Subway series?

A. It is therefore a chicken built with garlic, the Great Garlic. I love it. I like strong flavors.

Source link