Subway’s sales continued their post-pandemic recovery, rising 11.7% in North America in the first quarter, the company said on Monday.
The Miami-based company said that its average weekly unit volumes were their highest since 2010, when the $5 Footlong drove huge customer counts in the aftermath of the Great Recession. Globally, same-store sales were up 12.1% in the first three months of 2023, the company said.
Digital sales increased 21.2% in North America and 11.4% globally, the company said. The performance “demonstrates that our efforts to build a better Subway and win back the hearts and minds of sandwich lovers around the globe is working,” CEO John Chidsey said in a statement.
Subway has been publicly pronouncing its sales results in recent quarters as the company looks for buyers. Generating stronger sales is key for a brand that has struggled with low unit volumes that have led to widespread closures starting in 2015, which have cut about 6,000 restaurants from the system over that period.
The prospective buyers, reportedly groups of private equity groups and international operators, will likely want an assurance that the company’s challenges are in the past and that efforts to revitalize sales are working.
(Check out RB’s coverage of Chidsey’s interview at the Restaurant Leadership Conference.)
And the brand has had a strong post-pandemic recovery. System sales rose 4% last year and are up 17.5% over the past two years, according to data from the Technomic Top 500 Chain Restaurant Report.
It is the only one of the 10 largest restaurant chains that have yet to recover sales lost during the pandemic.
Still, the company has taken several steps to rebuild its brand over that time and generate stronger sales at existing U.S. locations. That includes multiple years of improvements to its sandwiches, from bread improvements and other ingredient upgrades in 2020 to the creation of a menu of a dozen “Subway Series” sandwiches designed to shift away from the focus on customization that was a hallmark of the brand for decades.
It also introduced new marketing and operators are remodeling locations. And operators have added slicers in their restaurants, which are designed to improve the perception of quality while lowering food costs.
Subway is also trying to overhaul its domestic franchise system, buying out business developers that sold and monitored franchises in different regions of the country and working to bring more multi-unit operators into the system. The company recently announced it had five new multi-unit franchisees, who theoretically have the financial wherewithal to fund remodels and ensure stores are fully staffed.
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