Are SUBWAY Franchise Owners Happy?

Are you familiar with the Subway franchise opportunity?

Are Subway franchise owners happy?  Why or why not?

Please share your thoughts and opinions below.

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subway_logo_00In the 30 years since it launched its much-hyped Franchise 500, Entrepreneur magazine has named Subway the #1 franchise 16 times.

According to Entrepreneur’s Subway Hits the Spot, “…In late 2008, the company surpassed the 30,000-restaurant mark. It has 1,600 stores scheduled to open this year. Another 2,400 franchisees have bought in and are waiting in line to open. And it’s on pace to overtake the king of fast food, McDonald’s, in outlet numbers within five years.”  Despite a disastrous economy, Subway CEO Fred DeLuca says 2008 was Subway’s “best year ever.”

DeLuca claims their secret to success is the value Subway provides to their franchisees and the simplicity of the concept:

“We work hard to be extremely efficient,” he says. “We give great value for our franchisees: They can build a store for well under $200,000. And we have extremely simple operating systems. The preparation is mostly done in front of the customer. That simplicity is really what attracts our franchisees. You see it, and you can do it”.

Detractors claim that the hype has been bought and paid for, that the Subway franchisor is tyrannical and the system is designed primarily to make money for the franchisor at the expense of Subway franchisees.

WHAT DO YOU THINK?  DO YOU OR HAVE YOU OWNED A SUBWAY FRANCHISE?  ARE SUBWAY FRANCHISEES HAPPY?  WHY OR WHY NOT?

logo:  Doctor’s Associates

31 thoughts on “Are SUBWAY Franchise Owners Happy?

  • February 7, 2012 at 9:00 pm
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    Do not buy a Subway! In illinois alone, the famous comment of all the development agency is you will sue us if we tell how much you are going to make. They don’t tell you because you don’t make money, even if you have a “cash cow” store.
    Fred Deluca has used fear and intimidation among the developers.
    The good news is seriously, God has blessed me so we are going to be ok, however God HATES dishonest scales so Subway corp will fail…. that’s why its good to get out.
    One DA employee said when questioned about her unethical practices of when selling a store, said I am not at liberty to answer that.
    They also use and abuse people from India, they play on their culture and use them, that is what a DA employee told me before she got caught.

  • March 19, 2012 at 5:22 pm
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    As a seasoned former Subway owner, Development Agent, and a current Subway transfer specialist, I have seen everything; some of the abuse and some of the great things about this franchise. Overall, if you toe the line you will be alright, and if you buy right, you will not regret your purchase. The ones who got burned are the ones who did not do their due diligence well or did not adjust their attitude when they should have. I do also see where the blame lies with Corporate or with the Development Agent office on occasion and have heard many horror stories that are never printed anywhere-but this is RARE.
    There is much information I possess and have elaborated on my website to make your Subway purchase/sale a decent experience.

    I continue to advise buyers and sellers to make their entry or exit less smoother as I understand the transfer process from every angle fo over 25 years

    Fayaz Karim
    http://www.mrfranchiseman.com, Subway Specialist

  • May 13, 2013 at 8:26 pm
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    Former Subway owner for over 5 years multiple stores. At first it was profitable but it only took a year for Subway to come up with the $5 footlong which was a instant hit. Sales soared, profits deceased for the franchisee. The local DA kept feeding us the Kool-Aid that this discount program was great for the franchisee. When you increase sales on a lost leader product your gross profits drop like a rock…. Bottom line was almost every person that bought a $5 footlong was a premium sandwich and 90% of the time never bought a drink or cookie. Store went from making $80,000.00 a year to when I checked out last year $24,000.00. Then corporate Subway decided to heavily discount products every month. Corporate never had marketing plan that didn’t require a discount….Great for corporate Subway because they take over 13.5% off the gross….They don’t really care what your net is as long as you don’t go out of business.
    Bottom line is Subway is one giant legal Ponzi scam where Freddy loads the gold in his wheelbarrow….and the franchisee/owner take it up the @ss…
    You want to be frustrated answering to local management that uses tactics right out of Nazi Germany… get a Subway franchisee. Where as a “owner” your just a employee of corporate and if you don’t drink the Kool-Aid they put you out of compliance and take your store…..Wait…in 3-5 years the Subway house of cards will fall.

  • May 13, 2013 at 9:35 pm
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    Did you sell your stores or just close them? Do you think you made money on the sell of your stores and will you go into another food operation? I did the math when I investigated subway and decided I could lose money or as you said, make very little. Can’t figure out why the stores turn so quickly.

  • May 13, 2013 at 9:37 pm
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    My local subway has had 4 owners in the last 5 years.

  • June 27, 2013 at 12:31 pm
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    Never Never buy this frachise. It’s all about franchise making money. They don’t care about you make it or loose. I’ve seen restaurant doing less than $4000 a week volume. What kind of concept is it? Is this a food business or scam.
    How can you survive in $4000 volume where you have to open 7 am to 10 pm everyday. There are development agent stores are doing 25,000 above a week and they will make sure that more than a miles in surrounding area there no other subway stores. If you don’t listen to Development Agent he will threat you to close down. If you want go back slavery then you sign up or you paying for your bad karma.

  • June 28, 2013 at 3:37 pm
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    How about that subway lawsuit with length of sandwich?

  • August 2, 2013 at 11:19 am
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    I just had some very unpleasant experience with the local development office in North Carolina. I was thinking about buying a franchise since last September. Of course, before I commit the rest of my life with all I have, I wanted to be sure this is the right option for me. So I slowed down the process in order to find if the local development manager considers on behalf of franchisees at all. Unfortunately, the answer is NO-NO!!! They don’t want to consider anything on your behalf!!! NOT A TINY LITTLE BIT!!! I have to say that I did not rush to pay the franchising fee and buy store. How about if the local development manager simply ceases your store and cancel your contract. I would think that every potential franchisee is committed if they want to sign a 20 years contract and put together all they have. BUT, YOU JUST NEVER WANT TO RUSH TO IT WITHOUT KNOWING IF THE OTHER SIDE TREAT YOU EQUALLY!!!

    I am disappointed with this particular development manager in North Carolina. But, considering the fact that this is the very person who could shut my store down 2 or 3 years down the road for whatever reason he thinks, I have to feel lucky for not going further with Subway!!!

  • August 14, 2013 at 12:29 am
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    My parents owned two subways back in the 1990’s and they were hard to deal with then but nowadays I’ve heard horror stories. Do not buy a subway for any reason. The corporate people will loot you for everything you have and local development agents are corrupt little tyrants who maliciously wield power. Subway only cares about their bottom line and not the individual owners. Restaurants like McDonald’s are well run and you only see a few around town but subway undercuts their own franchisees by cannibalizing their profits through opening more and more stores. This works well for corporate since they collect endless fees and royalties but keeps individual owners in perpetual anxiety over breaking even.. Stay far away from this vile company for the sake of your finances, family, and well being.

  • January 18, 2014 at 6:40 pm
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    I used to work for a DA in ??z, Got burned by a certain individual who bought the great 20k stores for himself and left the crumbs for the rest of us to fight over. Not to mention if a store was doing 15,000 anywhere he would build a store next to it, Pissed alot of owners off. Anytime a owner would say something. boom!! Get ready to lose ur store…sad sad thing!!

  • July 12, 2014 at 12:54 am
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    I’ve been in the system for the longest. Dishonesty, looting, scams, and bribery is what describes this subway system specially in Chicagoland area. They play you, and your mind out. DA in Chicago at first sweet talks and, by far no professionalism, he starts acting up on you. He thinks he’s the king of all Franchisee and that He can rule them. Come on now you are in f***** 21st century. Slavery ended far back. He finds ridiculous $h!t to screw you up. You don’t do what you are told specifically BY HIM AND THE Office you are f*****. DA here thinks money is everything and he can play anyone in anyways. He opens all these stores so close that makes it harder for evEry franchisee to make $. He has is own price structure to fight competition. Wait are we talking about competition ? Now it’s more like subway to subway competition that other QSR. You should hear what DA has to say when he is drunk. Yes I SAID DRUNK. Money is everything and he doesn’t give a damn about anyone. He will f**** you up to make his living. KARMA IS A BITCH Mr. DA.
    Do your homework before signing the lease. Try dealing with LL directly instead of having the DAs office deal with LL. They make commission on just about every thing- even the air you breath inside your subway store.
    Finally, I thank god I’m out of the system.

  • February 7, 2015 at 2:57 pm
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    2014 was a tough year for franchisee profits, especially those who were only marginally profitable because they became real losers and serious headaches for their owners. Many were put on the market in 2014 and 2015 will see even more.
    Lets debate the word PROFITABLE.(assuming no loan payments)
    If I make $5000 a year I am technically profitable, even if it is a pittance.
    If I make $30,000 a year I am certainly profitable but nothing worth writing home about.
    It is only when I lose $5,000 a year that I have an unprofitable store.

    None of this figures the time you spend trying to make a go of it, the less than minimum wage you make or the return on your initial investment. Or the additional funds you pour in to stay afloat. Watch for more store closures in 2015.

    Subway will not discuss store profits as nobody is allowed to for fear of lawsuits which come anyway.

    I have NO PROBLEM discussing profits of stores after reviewing some numbers and asking basic questions. Been doing it for 27 years and I am usually within 5% of actuality. Get your second opinion before buying a store! Lots of losers on the market in 2015………..but some mediocre stores make good buys when owner operated. Would you like to separate the winners from the losers?

    mrfranchiseman.com, Fayaz Karim, MBA,CPA, former Subway owner

  • June 11, 2015 at 5:31 pm
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    Fayaz,

    You are being paid by subway to give a professional opinion. Your boss Fred Deluca calls public relations.

    Deluca is a thief. The bible says when a thief is found out he must pay back 7 times what he stole. He will pay back 7 times what he stole

  • September 1, 2015 at 1:19 pm
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    There is a good possibility that Subway Corporate could face a class action lawsuit by it’s franchisees. They had knowledge of this pervert spokesman Jared Fogle yet allowed him to be the face of their brand. Now sales are declining, and why
    wouldn’t current franchisees file a class action as their investments become less and less valuable!!!

  • September 2, 2015 at 5:37 pm
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    Rosa, I am sorry, you are so wrong…I do not work for Subway nor paid by them in any manner. I am an independent business consultant who just happens to have specialized in the Subway brand because I owned some stores and was a DA. I have heard and seen it all. Same stories, different faces, different times and places.
    I have also seen many people become millionaires by putting up with everything and following the system(as long as they can stomach it). Depends on your tolerance level, your expectations, and your advisors.

    Rebecca…get off the class action mindset. Read the first few pages of their FDD where it spells out that your store can FAIL and no promises are made. Trouble is nobody reads it.

    This is 2015 Sept; great buying opportunities exist and the brand will not fail, just don’t buy the really poor stores. Let them fail or close or move them.
    I can say this with confidence because I am a Business Buyer Coach (BBC) and I have seen much in my professional and practical business experience. Try opening a Subway in a foreign country with No Bread, No Pepperoni, No Bologna, No Salami, No Turkey, No meatballs, No Sauce. No olives….
    I did and succeeded until I had a personal issue to deal with. Divorce, and custody of two gorgeous kids.
    The Subway system works…..but you must understand it and follow it even if the generals are unpleasant at times.

  • February 27, 2016 at 5:20 pm
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    I have been the owner of subway for last 5 years and I finally came to know that this company will loot and exploit you so bad that you will have no option at the end. It is designed so subway definitely make money but NOT you. The field consultant will continuously harass you every month no matter how hard you try to be in compliance. My field consultant even went personal cause I fired her friend from one of my store and tried to make my store out of compliance and shut down. If you are wise, DO NOT own SUBWAY, think 10 times, its a fraud and created to make money for them only. Anyway you DO NOT make any money with the current labor cost and food cost at all.

  • March 13, 2016 at 12:18 am
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    Wow …. After reading all comments I have one question in my mind … Is it really that bad? If it is … How come I see one owner owning multiple stores ? Any kind of help would be great … I want to open store in Texas ? Is it a good idea or not

  • July 10, 2016 at 10:14 pm
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    I was a multiple franchise owner of Subway for 10 years. It was a horrible experience. They can force you out by giving you bad evaluations and sell your store to someone else. The evaluations are subjective. If you play the politics and are one of the favorites you are OK. But if the DA wants your store, you have very little choice when they start handing out the bad evaluations. Every discount or store upgrade is at the franchisee’s dime. The $5.00 sub was a franchisee killer of profits. Fred Deluca never takes a loss on a discount it is all on the franchisee’s back. The DA’s are in bed with Fred. DON’T BUY A SUBWAY.

  • August 24, 2016 at 6:34 pm
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    Everybody wants to get rid from this loot company called subway, now most of its own franchisee hate this brand so bad. Subway opened 911 new locations in the U.S. last year, it closed 877. That means it netted just 34 restaurants in 2015. This will continue until subway treats its franchisee as its slaves not as business partners.

  • August 25, 2016 at 5:41 pm
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    Aamir: Look at all the different franchises on this site. Most if not all share one common thread. The franchisee is at the mercy of the franchisor because they are contractually bound to them. Franchising is a win win for the company. They collect the initial franchise fee, The royalties (most if not all agreements have minimum royalties), and the franchisee bears all of the cost of operating the business. The franchisor has discretion of how much they spend on advertising, product development etc. The franchisee has no say in what goes on at that level. That’s why a company like Subway advertises a $5 foot long sub, they see it as good marketing, its the franchisee that has to cover the cost.

    In my view the business model of franchising may have been a good model back when Ray Kroch started McDonalds. But it’s now gone from something of a mutually beneficial relationship to a scheme of exploitation by the franchisor.

  • September 9, 2016 at 8:43 pm
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    My 6 yrs experience in subway restaurant as an owner is absolutely horrible and nightmare. I have 3 store in town and I am counting every single day to sell my store as soon as possible. The whole subway system is created so that they definitely make money (12.5 % royalty + advertisement fee) but not the owners. They will send you the most nasty unprofessional people they call “field consultants” to harass you every month, no matter how hard you try to keep the store in compliance they will wait until you make some mistake and write yo up and harass you . The head quarter will send you termination letter time to time threatening to take your store. DO NOT do subway franchise. This is not designed in honest.

  • October 4, 2016 at 1:00 pm
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    I was going to contact subway for consultation in purchasing a subway. Now that I have read these articles from franchisee owner, I will never own a subway nor step foot in one to eat ever again.

  • January 2, 2017 at 1:39 pm
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    Thank you for the honesty of the people of the evaluations of the subway franchise and the sharing of their experiences.

    I was going to purchase a Subway and in fact had a meeting sometime this month but after reading this I really believe this is a godsend for me not to do it.

    I want to do the right thing I don’t want to waste my money and be going out of business I work too hard for that.

    Thank you for your bravery and your truth and your willingness to share your experience

  • February 6, 2017 at 10:52 pm
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    If you want to become a slave of subway corporate and like slavery then become the subway owner. That’s all I can say.

  • March 8, 2017 at 3:23 pm
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    got into this business back in 1995 when things were simple. worked hard and put in the hours. Built my empire from nothing to five stores. Worked through my loans. As the years went by I realized my profit was getting thinner as wages and competition went up. To make the long story short. I went from being on top of the world to a bankrupt husband and father of two with no retirement.

    DO NOT GET INTO SUBWAY! They will paint a pretty picture and once they drain you of all your money they won’t hesitate to throw you to the carve. Its all politics. Its not what you know or how much money you have. ITS WHO YOU KNOW.

    The DA in SoCal will treat you like you are trash as if they own you. They will buy or built all the high volume stores and will allow franchisees to have any left overs.

  • April 1, 2017 at 10:54 am
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    Subway will exploit you and squeeze you till they can get a single dollar from you and throw you in the trash at the end. It has come so far by exploiting so many poor franchisee and advocates itself as a healthy option and environmental friendly, it’s all crap. But the people are understanding about this greedy company slowly and it’s going towards quiznos path. DO NOT own subway franchisee.

  • May 4, 2017 at 11:30 pm
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    Subway restaurants are shrinking in USA . There are so many subway restaurants are on sales with one-third of the price and yet no one is buying, main reasons are, you don’t make any money with this franchisee now at all and the subway will treat you nasty, harass you all the time. Do some research. There are so many subway restaurants have been closed permanently and it’s shrinking the first time in it’s history.

  • May 28, 2017 at 1:04 pm
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    Subway is the financial predator for it’s franchisee. It can get your store anytime they want by throwing you the negative evaluations and drag you to the arbitration. They loot you almost of 13% off the weekly sales, and with the current sinking sales and labor cost, it’s impossible to make any profits with this brand, it’s very likely that within 3-5 yrs , huge chunks of subway stores in USA will close down. The store’s market value is already less than one-thirds of original price and yet no one is buying them.

  • May 29, 2017 at 11:13 am
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    I worked at a Subway for about 3 months. It was a total disaster. The Texas franchisee overpopulated the area with Subway stores, not a particularly dense area but there were half a dozen Subways in a 2-mile radius. The management of every store was up to a manager, it would range from well-run stores to a total disaster, and usually they were overworked and underpaid…the franchisee would arbitrarily decide about items to stock (there were NO decisions made in-store), and the in-store management only had very limited hours. We were one of the better stores but some of the stores were barely breaking even, yet they kept them all open.

  • August 4, 2017 at 5:18 pm
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    i am on my second year now and going to my third year. no matter how hard to try to keep the store going, the field consultant will dig some BS to write you so you will be out of compliance. they control everything like where you buy the produce and what soda you are allow to sell to how many flavor of chip. if they see food you bring from home, they will accuse you of selling in subway rest…..oh that happen many time already just so you know……..coupon and discount that you have to give out, you don’t even get the credit back for the food you just give out for free don’t matter where the coupon or the subway reward program where they earn the points from …..and you have to accept the coupon customer call the corp to complaint and u have to deal with more BS from them. it really got to a point to say that you don’t even own the store, you are just a low paying employee. every week 12.5 % gross sale go to them not net sales. you have to give them your employee schedule every week ??? every equipment you have to buy from them. ex. tip jar……$20.50 included shipping???? the hell???? why because it have a subway logo??? even if your business is failing…. you can just quit , you have to get there approval before you give up on your business. i still in business as of today and how i don’t know………please please don’t get in to a subway…….people complain that divorce is bad, subway agreement is 100 time more worse……

  • October 1, 2017 at 11:36 am
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    Absolutely horrible corporate to work with. When you sign the franchise agreement with subway, basically you are signing a slavery agreement with subway corporate so you definitely make money for them no matter what’s your financial situation is. DO NOT own the subway franchisee and if you already have, do not extend the lease if it is going to expire soon. You will regret it in your life.

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