ALEXANDRIA, Va.—Subway announced it plans to expand its international presence by 9,000 locations, reports The Wall Street Journal. John Chidsey, the company’s CEO, said the move will allow Subway to increase its sales by more than 50%.
The QSR wants to increase its number of international locations to about 25,000, up from its current 16,000, over the next 10 years—part of the company’s plan to raise its annual sales from $16 billion to $25 billion. Global same-store sales were up 9.2% in 2022.
Chidsey told the Journal that company growth lies abroad, as sandwiches can fit into multiple dietary preferences and the chain has much less competition.
“The unit-growth story continues to be international,” Chidsey told the Journal.
Subway has signed eight non-U.S. master franchise and development agreements that will result in a total of 5,300 new locations by 2027 in India, Turkey, Brazil and elsewhere. Chidsey told the Journal that Subways are cheaper to open and operate than other fast-food establishments due to less labor and cooking equipment, so franchisees are drawn to investing in them.
Same-store sales in North America were up 7.8%. The company is looking to remodel 3,600 stores in the market after completing 2,600 renovations last year. There are about 20,000 U.S. Subway locations, and each store averages annual sales of $478,400, which is a 10-year high, said Chidsey.
“The consumer is finally giving us credit for the quality of the meats and proteins that we always had,” Chidsey told the Journal.
The company overhauled its menu last year, offering customers the Subway Series, a lineup of 12 signature sandwiches. The company also introduced a new menu and ordering system. Instead of customers picking their ingredients and toppings throughout the ordering process, customers can select a sandwich via a name or number and specify if they want a 6-inch or footlong sub. The company is also paying for meat slicers at franchises, which should be in locations by the summer.
The Journal recently reported that Subway is exploring a sale of the company and retained advisers last month. Subway could be valued at more than $10 billion. Though he did not comment on the sale, Chidsey said he is focused on improving financial performance.
“No matter what they decide they want to do with the business, we’re leaving it in a better shape than we inherited it,” he said.