The struggle is real over in sandwichville.
Subway announced that approximately 500 of its stores would be closing their doors. This comes after more than 900 locations closed in 2017!
So, why are so many Subways closing? It turns out that the business is going through quite a rocky transition. It all started when the current CEO, Suzanne Greco, first took control of the company in 2015 following the death of the chain’s co-founder, Fred DeLuca.
Greco has worked at Subway since she was a teenager. But franchisees have complained about her role as CEO. They say she has offered inadequate support and has not fostered growth for the company. And Business Insider released a statement that indicated about one-third of the 25,800 Subway locations in the United States might not even be profitable.
One franchisee told Business Insider, “A lot of people in the industry feel that Suzanne is not qualified to be the CEO of the company. She tells us she is doing us a favor while franchisees are losing everything they own.”
In the midst of this chaos, Subway’s great counteraction strategy was to bring back the coveted $5 footlong promotion.
Subway exec slams head into idea board, “fiiine.”
But to franchisees, it wasn’t fine. More than 400s locations signed a petition against it, claiming the $5 deal is what destroyed the business in the first place.
According to Business Insider, store owners foresee 500s of additional stores closing in 2018 and are worried that up to one-third of Subway locations in the US could soon be unprofitable.
As one store owner lamented: “I have sadly watched my peers close their doors… It is inevitable that I will do the same in the near future… this was my retirement, and now, well, it’s over.”
Subway employees also feel the blame rests squarely on the shoulders of Subway CEO Suzanne Greco and other upper-management personnel.
In fact, many speculate the real story behind Linhardt’s resignation was the backlash against the footlong promotion, while other sources close to the situation claim he was ousted by an alliance of execs with differing ideas for the future of Subway.
Sources: AWM, BusinessInsider
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