Subway Ditches $5 Footlong
Franchisees complained that the iconic, low-cost sandwich ate into their margins too much to stay on the menu.
Sep 12, 2018
MILFORD, Conn. – The $5 Footlong is once again leaving Subway restaurants, USA Today reports. Franchisees howled when the company returned the iconic sandwich to the menu last year, citing the promotion’s tiny margins. With 100% franchised restaurants, Subway decided to allow each location to keep or remove the sub.
“How do we help our franchises with more of a regional value message, so they’re able to [have] a value proposition that fits with their economic model?” asked Trevor Haynes, CEO of Subway. “If you look at California, there’s a very different cost of business than in Arkansas.”
Subway clocked $16.8 billion in worldwide sales last year, although it has downsized around 1,300 U.S. locations over the past two years. The disappearance of the $5 Footlong is only one change happening at Subway. The company is encouraging different markets to play with variations of value menus, such as offering San Francisco customers a $3.99 six-inch sub. “Affordable food is what we’ve always stood for,” Haynes said.
The chain also is taste-testing new menu items, such as the Firebird chicken (a spicy rotisserie chicken) and guajillo steak. In San Diego, 200 units are testing regional flavor sandwiches, including a Steakhouse Melt, California Club, Italian Grinder and Provencal Tuna Melt. New drinks such as Passion Fruit Agua Fresca and Watermelon Agua Fresca are also on some menus.
In addition, Subway is moving away from sub rolls and experimenting with paninis at some California units. Its line of sandwich wraps, introduced in March, has been “extremely successful for our brand,” Haynes said.
However, Haynes emphasized the need for the company to not stray too far from its roots. “We need to stick to what we know and do it very, very well. We can’t be distracted,” he said. “Burger chains are big competitors. We need to make sure we’re playing in that arena as well.”
