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Subway

Financing

Why Subway’s latest $5 Footlong offer didn’t work

The promotion didn’t generate needed traffic and operator participation was weak, which doomed the strategy, says RB’s The Bottom Line.

Financing

Subway is pulling back on its $5 Footlong offer

The chain is making its “$5 Footlongs when you order two” promotion digital-only as the offer hurt operator profits.

McDonald’s, Subway, Dunkin’ and Panda Express have all said they’re adding thousands of workers as operators take advantage of high unemployment.

Operators have started filing complaints with the Federal Trade Commission as their dispute with the franchisor intensifies.

Subway franchisees are pushing back against a Footlong sub promotion, much like Burger King operators fought a $1 Double Cheeseburger, says RB’s The Bottom Line.

Three-quarters of operators in a survey said they don’t like the proposed promotion as tensions between the company and franchisees intensify.

Deals are a draw in both quick service and casual dining, finds Technomic.

While the offer worked when it was first proposed, a decade’s worth of food and labor costs make it difficult, if not impossible, to make a profit, says RB’s The Bottom Line.

The company is offering vendor rebates to get operators on board, but the franchisee association is recommending its members opt out of the campaign.

The sandwich giant said it had to “accelerate a restructuring plan” already in place.

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