The largest sandwich chain in the country is said to be lobbying the people who make its bread and butter. Subway recently ran into trouble … and after franchise owners wrote an open letter asking for help from the company team, the company responded by updating some policies in a way. which, according to a new report, may look more like a bread knife behind your back.
Subway has seen a lot of drama this year. The recent launch of their Fresh Melts damaged equipment at some Subway store owners, and some Subway operators recently said the chain is using overly processed foods and garnishing their dishes with products that are past their prime.
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These are just a few examples of the friction with franchisees the company has faced this year. In April, the New York Post reported that 250 Subway franchise owners wrote an open letter to the widow of the late founder of Subway, telling her that their dream of entrepreneurship through the ownership of the Subway franchise “has turned into a nightmare.” Their complaints related to the structure of their real estate deals, the quality of Subway’s ingredients, and other operational issues, such as 1851 reported this week, “Subway franchise owners recently asked the brand to reduce its franchise fee to 4.5% instead of 8%.”
Less than two months later, Subway has definitely made some changesâ¦ but not for the better, many franchise owners believe. 1851 reports that Subway corporate executives are giving franchisees the choice of “paying a 10% royalty (as opposed to the 8% royalty rate in 2020) or keeping the old royalty rate but with several new conditions, which prevents franchise owners from speaking out against the brand, forces franchisees to pay high fees if they close their stores, gives the company the power to dictate store hours and more, â according to 1851.
1851 reported that over 1,000 Subway branches closed last year and, they say, “operators predict thousands of franchise owners will be forced to exit the brand due to Subway’s continued struggle . “
Still, Subway commented on this in a recent statement, by 1851: “Our franchise agreement and all its terms are disclosed in the [franchise disclosure document]. They added, âThe terms are competitive with others in the QSR franchise industry. “
If all of the recent buzz is true, maybe it’s not just the supposedly weeks-old products that leave a bad taste. Find out what happens to your body when you eat a subway walk and sign up for our newsletter. Keep reading: