Subway (restaurant)

• 1. Introduction

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  Subway began in 1965 with a $1,000 loan between friends. Fred DeLuca borrowed the money from Peter Buck and opened Pete's Drive-In: Super Submarine Sandwiches at 3851 Main Street in Bridgeport, Connecticut. As of September 2023, the business that grew from that one shop counted over 37,000 locations in more than 102 countries and territories. It is the largest single-brand restaurant chain in the world, and also the largest restaurant operator. How does a loan between two friends turn into that? Why do the owners of its stores hand so much of their profit back to the company? And what happens when a chain built on the promise of freshness runs into lawsuits, a spokesman's guilty plea and a falling number of customers walking through its doors?

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• 2. Doctor's Orders

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  The name Doctor's Associates Inc. appeared in 1966, a year after the Bridgeport shop opened. DeLuca and Buck formed the company to oversee their restaurants as the franchise expanded. The name came from two separate facts. DeLuca hoped the business would earn enough to pay his tuition for medical school, and Buck held a doctorate in physics. The sandwich shop itself was later renamed Subway. Its first franchised restaurant opened in Wallingford, Connecticut.

  Opening a Subway costs far less than opening most rival restaurants, with startup costs in the range of $200,000 to $500,000. The trade-off is steep. Franchisees pay roughly 12.5 percent of profits back to the company, among the highest shares in the industry. Every location is independently owned and operated by one of these franchisees.

  By 2017, the Subway Group of companies had spread its duties across many legal entities. Subway IP Inc. owned the intellectual property for the restaurant system. Franchise World Headquarters, LLC led the franchising operations, while FWH Technologies, LLC owned and licensed the point of sale software. Doctor's Associates Inc. stayed on as a franchisor in the United States, alongside Subway International B.V. and Subway Franchise Systems of Canada, Ltd. Separate advertising funds, such as the Subway Franchisee Advertising Fund Trust, Ltd., handled marketing. In Europe, IPC Europe, short for Independent Purchasing Company Europe Limited, managed the franchisees and the Subcard loyalty scheme.

  The founding families kept this whole system in their hands for six decades.

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• 3. Reach Across Borders

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  A restaurant in Fresno, California, became the first Subway on the West Coast in 1978. Six years later, in December 1984, the first one outside North America opened in Bahrain. St. John's welcomed the first Canadian restaurant in 1986, and Brighton got the first British one in 1996. The first Indian restaurant followed in 2001, in New Delhi.

  Cajun Joe's, a Boston, Massachusetts chain selling fried chicken and Cajun food, was Subway's 1989 purchase. The venture proved unsuccessful. Most of those restaurants had closed by the end of the 1990s.

  In 2004, Subway began opening stores inside Walmart supercenters. By 2007 it had passed McDonald's in the number of locations inside U.S. Walmart stores. At the end of 2010, Subway became the largest fast food chain in the world, with 33,749 restaurants. That was 1,012 more than McDonald's. Since 2007 the chain has consistently ranked in the Entrepreneur Franchise 500. In 2015 it placed third on the Top Global Franchises list and first as the Fastest Growing Franchise.

  As of September 2023-21,796 locations, or 61.1 percent of the total, sat in the United States. Figures from 2019 show how the rest of the footprint divided. Canada had 2,881 restaurants and Mexico had 758. Outside North America, the United Kingdom led with 2,195, followed by Brazil with 1,643 and Australia with 1,215. In 2018, the U.S. total came close to the number of McDonald's and Starbucks locations combined.

  Shelton, Connecticut, holds the international headquarters, in the Enterprise Corporate Park, where Subway takes 90,000 square feet across three floors. The facility began operations in 2023. The company said it chose Shelton for its closeness to various Connecticut locations and to points of interest. The former headquarters in Milford, Connecticut, spread across three land portions, and its buildings were razed in 2024.

  Five regional centers support the international operations. Amsterdam serves the European franchises and Brisbane serves Australia and New Zealand. Beirut and Singapore serve Asia, and Miami hosts the Latin American support center.

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• 4. Menu and Faith

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  The B.M.T. is Subway's best-selling sandwich, and its name is short for Biggest, Meatiest, Tastiest. It holds pepperoni, salami and ham. The letters also nod to the Brooklyn-Manhattan Transit, a link to the chain's own name.

  Beyond the submarine sandwich, the core menu stretches to wraps, salads, paninis and baked goods such as cookies, doughnuts and muffins. Breakfast sandwiches, English muffins and flatbread are also sold. Breakfast and pizza items appear only at select locations. In 2006, personal pizzas debuted in some U.S. markets. They are made to order like the subs and heated for 85 seconds. In November 2009, Subway agreed to serve only Seattle's Best Coffee as part of its U.S. breakfast menu.

  April 2017 brought paninis in four versions: Chipotle Steak & Cheese, Triple Cheese, Chicken Cordon Bleu and Italian B.M.T. Melt. In September 2018, the Chipotle Cheesesteak sandwich appeared for a limited time. Regional testing of a crispy chicken sandwich also began in Arkansas. In January 2024, Subway launched Sidekicks, a range of footlong baked goods made in partnership with Cinnabon and Auntie Anne's.

  The SubDog started as an April Fool's joke in 2022. It is an American-style hot dog topped with mozzarella cheese, tomato sauce and a limited-edition tangy mustard. Popular demand turned the joke into a limited-time offer. It returned in Australia from the 2nd of September to the 6th of October 2024.

  In 2011, Subway introduced gluten-free bread and brownies at some Texas locations. That same year, it cut the salt in its sandwiches by 15 percent.

  Menus change most from country to country where religious requirements touch the meats served. In 2006, a suburb of Cleveland, Ohio, got the first kosher Subway in the United States, inside the Mandel Jewish Community Center of Cleveland. A press release said the menu was virtually identical to that of any other Subway, apart from slight changes such as no pork-based products and a soy-based cheese. Other kosher openings soon followed, and for a time Subway was one of the largest kosher restaurant chains in the country. At the peak, twelve kosher locations were open, including one in Kansas City and five in New York. As of 2023, only one remains, in Miami, Florida. Franchisees who failed pointed to weak advertising support from the parent company, higher costs for kosher food and supervision, and being unable to open on Saturdays. They also said that customers who do not keep kosher preferred the original menu and prices.

  Subway's 591 restaurants in 68 Indian cities, counted in January 2017, do not serve beef, in deference to Hindu beliefs. The country's large number of vegetarians also pushed the outlets toward a much wider range of vegetarian options. On the 4th of September 2012, the first all-vegetarian outlet opened on the campus of Lovely Professional University in Jalandhar, Punjab. The second opened on the 6th of March 2013 in Paldi, Ahmedabad, and also offered Jain food.

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• 5. Selling the Sandwich

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  In 2011, Subway spent $516,000,000 on measurable advertising, which made it the second-biggest fast food advertiser in the United States, behind only McDonald's. Its pitch was the slogan Eat Fresh. The company stressed freshly baked bread, fresh ingredients, and sandwiches made in front of the customer to exact specifications. The employees doing the work were called Subway Sandwich Artists.

  The Sub Club stamp promotion ended in 2005. Subway cited a growing number of counterfeit stamps, blaming online auction sites and the rising availability of high-quality printers.

  In November 2007, Peter Griffin, the cartoon character from the FOX series Family Guy, appeared in U.S. commercials promoting the new Subway Feast sandwich.

  The U.S. television series Chuck carried Subway product placement from its first season. As ratings dwindled in the second season, a campaign to save the show urged fans to buy a footlong sub on the 27th of April 2009, the date of the season finale. Tony Pace, Subway's marketing officer, called it the best product placement the chain had done "in several years."

  National Sandwich Day, the 3rd of November 2015, brought a Buy One, Give One sandwich promotion. Most locations also run Sub of the Day, which features a different discounted sandwich on each day of the week. In the past, a specialty sub was discounted for a whole month.

  Early in 2017, the Italian Hero sandwich launched with ads from the national creative agency MMB that called it an authentic Italian-American sandwich. Two comedic spots placed Italian-American characters on and around the stoop of a tenement building, one with a cameo by sportscaster Dick Vitale. Another ad featured Jeff Mauro of Food Network, known as the Sandwich King, explaining the different Italian meats and other ingredients.

  July 2021 brought the Refresh campaign, starring Tom Brady, Stephen Curry, Serena Williams and Megan Rapinoe. After the 2020 Olympics, franchisees asked that Rapinoe be pulled from the ads. They claimed her testimonial caused sales to dip and harmed the stores' reputation.

  NASCAR races have carried the Subway name: the Subway 300 in 2001, the Subway 400 from 2002-2004, the Subway 500 from 2003-2007, the Subway Fresh 500 from 2005-2013 and the Subway Firecracker 250 from 2009-2016. From 2009 to 2014, Subway also sponsored the Subway Super Series ice hockey tournament. In September 2022, a three-year partnership with Football Australia gave Subway the naming rights to the men's national teams as the Subway Socceroos, Subway Olyroos, Subway Young Socceroos and Subway Joeys. It also became the official partner of the Matildas and the Australia Cup.

  Jared Fogle became a national spokesman for Subway in the United States in January 2000. He gave talks on healthy living and appeared in advertisements. He first drew attention in his native Indiana by saying he had lost over 200 lb, partly by eating at Subway. After 2008 he appeared less often as the company leaned into its 5 dollar footlong campaign. Subway credited him with between one-third and one-half of its growth from 1998 to 2011, the equivalent of a tripling in size. The company ended the relationship in 2015 after he was charged with possession of child pornography and illicit sexual conduct with minors. He pleaded guilty in August 2015 and, three months later, was sentenced to more than 15 years in federal prison.

  December 2015 brought a campaign called Founded on Fresh, which retold the company's early history with Fred DeLuca played by his son, Jonathan. It downplayed jingles and celebrity endorsements, apart from targeted sports marketing, in favor of the qualities of specific products. Chief advertising officer Chris Carroll said the focus on fat, calories and weight loss was "what fresh used to be." The new emphasis would fall on how Subway sources its ingredients. Carroll added that the strategy had been in development before the Fogle controversy.

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• 6. Five Dollar Footlongs

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  In 2008, Subway began selling nearly all of its regular 1 ft sandwiches for five dollars in the continental United States and Canada. Premium and double-meat varieties were excluded. It was billed as a limited time promotion, but Five Dollar Footlongs quickly became the most successful promotion in the company's history.

  Customer response led Subway to create a $5 Footlong Everyday Value Menu, offering some footlongs at that price. Since 2011 there has also been a monthly rotating $5 footlong. In October 2011, a similar promotion reached the United Kingdom. Customers could pick one of nine subs plus any drink for 3 pounds with a 6 in sub or 5 pounds with a footlong.

  The economics did not work everywhere. In 2012, restaurants in San Francisco dropped the promotion because doing business in the city cost more. From June 2014 to the end of that year, other locations began dropping it too. On the 1st of November 2014, Subway discontinued the five-dollar footlong and replaced it with the Simple $6 Menu. That menu paired a six-inch select sub with a drink and a choice of cookies or chips.

  In February 2016, all classic footlongs were priced at $6 each. In January 2018, the $5 promotion returned as a $4.99 footlong menu of five subs at participating locations. In September 2018, Subway announced it would discontinue the $5 footlong promotion to boost franchise profits.

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• 7. Courtrooms and Complaints

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  In September 1999, at least 32 customers in Seattle contracted hepatitis A after eating at two Subway outlets. The virus spreads through food or water contaminated with infected feces. Investigators found that staff had not followed thorough hand washing and the use of plastic gloves during food preparation. A class-action lawsuit on behalf of 31 victims was resolved for $1.6 million. The most seriously affected victim, a 6-year-old boy, suffered acute liver failure and needed a liver transplant. He received $10 million in an out-of-court settlement in 2001. A similar outbreak in 1996 had also involved a Seattle Subway outlet, although no legal action followed.

  On the 2nd of February 2007, the television station KNXV-TV, with the help of the Arizona Department of Weights and Measures, measured three Giant Sub sandwiches. Each was advertised at 3 ft, yet they came in at 81.0, 81.9 and 82.6 cm. Arizona rules forbid an item from being more than 3 percent shorter than advertised. A three-foot sub must therefore be at least 2 ft 10.92 in long.

  A jury in Illinois held Subway Sandwich Shops, Fred DeLuca, Peter Buck and Doctor's Associates Inc. liable for breach of contract in 1995. It awarded more than $10 million to Nicholas and Victoria Jannotta after finding lease and contract violations. The plaintiffs said the defendants had misrepresented the asset value of Subway Sandwich Shops, a leasing company used for franchising, while negotiating a 1985 lease.

  In 1989, the U.S. Small Business Administration refused small business loans to Subway franchise owners until Subway removed a contract clause. The clause let the company seize and purchase any franchise without cause. The Dallas Morning News reported that Subway seized the stores of American soldier Leon Batie Jr. in 2006, while he was serving in Afghanistan. He had been deployed in March 2005 to support Operation Enduring Freedom, three years after buying his first restaurant. Batie alleged that Subway had violated the U.S. Servicemembers Civil Relief Act. His federal lawsuit was dismissed, and he then sued in state court in Dallas County, Texas. In January 2010, both parties settled on confidential terms they called mutually agreeable.

  In October 2010, Subway franchisees in the United Kingdom lost a high court appeal against paying standard VAT on all toasted subs, as required by HM Revenue and Customs.

  On the 31st of January 2011, Subway lawyer Valerie Pochron wrote to Casey's General Stores, an Iowa-based convenience store chain. She demanded that it stop using the word "footlong" in ads for its 12-inch sandwiches. Casey's filed a petition asking a court to declare the word generic. It then voluntarily dismissed the action before serving its complaint on Subway. Subway's trademark application for "footlong" has not been approved, and the company has twice abandoned attempts to register the term with the United States Patent and Trademark Office.

  Food blogger and activist Vani Hari gathered more than 50,000 signatures in a petition to remove azodicarbonamide from Subway's bread. The additive is banned in the European Union and is a potential carcinogen, and Subway removed it. In August 2015, Hari petitioned again, joined by the Natural Resources Defense Council, Friends of the Earth, the Center for Food Safety and U.S. Public Interest Research Group. They asked Subway to commit to meat produced without routine antibiotic use. In October 2015, Subway announced a switch to chicken raised without antibiotics in 2016 and turkey within the following two to three years. Beef and pork would follow by 2025. In 2020, the Supreme Court of Ireland ruled that Subway bread contained too much sugar to be classed as bread, so it had to be classed as cake.

  In 2017, the Canadian Broadcasting Corporation investigated chicken sold by five fast-food restaurants. DNA testing of two Subway chicken items found 53.6 percent and 42.8 percent chicken DNA, with the remainder mostly soy. Subway disputed the report and demanded a retraction while it investigated with its supplier. In April 2017, Subway filed a $210 million lawsuit against the broadcaster, alleging reckless and malicious publication. The broadcaster stood by its reports, citing independent and credible experts. In November 2019, the suit was dismissed under anti-SLAPP legislation because the reporting was deemed a matter of public interest. In January 2021, the Ontario Court of Appeal overturned that decision. The Supreme Court of Canada denied leave to appeal, so the case returned to the Superior Court of Justice for trial.

  In 2019, Australia's Fair Work Ombudsman found that 17 Subway franchises had failed to pay employees minimum wages, casual loadings, holiday rates and overtime rates. They also did not issue proper pay slips or keep proper employment records. Over $81,000 in unpaid wages was recovered for more than 160 employees.

  In December 2015, Subway committed to eliminating battery cage eggs from its North American supply chain by the end of 2025. In January 2022, the Open Wing Alliance criticized the company for failing to report progress. In August 2025, a representative of The Humane League said Subway leadership had refused to engage with the group on the pledge. A month later, Subway announced it would eliminate caged eggs from U.S. locations by November 2025 and from Canadian locations by the end of the year.

  High school activist Lia Hyman led a nationwide 2017 campaign against fast-growing broiler chickens, in coordination with The Humane League. On the 20th of April 2017, she and fellow activists delivered more than 53,000 signatures to a demonstration outside Subway's headquarters in Connecticut. Subway then released a chicken welfare policy. It required U.S. chicken to be produced in line with Global Animal Partnership standards by 2024, covering living environments, activity levels, stocking density and slaughter methods. In 2024, World Animal Protection reported that Subway still practiced low broiler welfare standards in its European supply chain.

  After the 2022 Russian invasion of Ukraine, Subway drew criticism for not divesting or scaling back in Russia, unlike most competitors. Ukraine's National Agency on Corruption Prevention said Subway kept advertising in Russia and collecting payments from its Russian franchisees. In January 2024, the agency listed Subway among International Sponsors of War, though the list was withdrawn after diplomatic pressure. In June 2024, Subway announced it was ending its Russian franchise agreements. In August 2025, the former Russian franchisee, having lost the Subway trademark rights, rebranded as Subjoy.

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• 8. Slump and Sale

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  In January 2015, Suzanne Greco became Subway's president and CEO. Her brother Fred DeLuca, the company's first CEO, had been ill for two years. He died of leukemia in September 2015.

  In 2016, Subway closed hundreds of U.S. restaurants and recorded a net loss in locations for the first time. With 26,744 locations it was still the most ubiquitous restaurant chain in the United States, with McDonald's in second place. In July 2017, it unveiled redesigned restaurants under the name Fresh Forward, with new branding, self-order kiosks, USB charging ports at tables and new menu items.

  More than 800 U.S. locations closed in 2017, and in April 2018 the company announced about 500 more would close that year. Abha Bhattarai of The Washington Post tied this to three consecutive years of falling profits and a 25 percent drop in foot traffic since 2012. Franchisees complained that deep promotions further ate away at profits. In January 2018, Subway invested $25 million in a rebranding campaign aimed at young consumers.

  John Chidsey joined in 2019 as the first CEO who was not a member of the founding family. He focused on improving established U.S. locations rather than building new restaurants. In December 2020, Subway partnered with ezCater to offer an online catering platform.

  In 2023, the family announced it was in the process of selling the company, with the help of JP Morgan. The price was reported at around $10 billion. Offers came from the asset management division of Goldman Sachs, TDR Capital and TPG Inc., among others. On the 24th of August 2023, Subway announced that Roark Capital would buy the company for $9.6 billion. That made it the third-biggest U.S. acquisition in restaurant history, behind Burger King's 2014 purchase of Tim Hortons for $11.4 billion and Inspire Brands' 2020 purchase of Dunkin' Brands for $11.3 billion.

  In November 2023, the Federal Trade Commission said it was looking into investigating the deal. Roark already owned Subway competitors McAlister's Deli and Jimmy John's, which raised the possibility of a monopoly in the sandwich shop industry. On the 30th of April 2024, Roark officially acquired Subway after the commission determined that Roark did not have an unfair advantage.

  On the 19th of March 2024, Subway signed a 10-year deal with PepsiCo, starting on the 1st of January 2025. It ended a partnership with The Coca-Cola Company that was first signed in 2003, took effect in 2004 and was fully switched over by 2005. Subway's international locations had already returned to Pepsi products between 2015 and 2018. Pepsi had also supplied Subway from its founding until the Coca-Cola switchover.

  By the end of March 2024, Subway's Brazilian unit had gone into bankruptcy with over 482 million Brazilian reais, nearly $100 million, in debt. SouthRock Capital, the operator of the Brazilian restaurants, later declared Chapter 15 bankruptcy in June 2024.

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