Subway closed more than 500 US stores in 2022: report
Subway has closed roughly 6,000 locations in the U.S. since 2016
2023 to see a ‘decrease’ in food-basket costs: Subway CEO John Chidsey
Subway CEO John Chidsey discusses the economic outlook of the company along with the impact inflation has had on business on ‘Mornings with Maria.’
Subway shut down approximately 2.7% of its store in the U.S. last year after an even larger scale of closures in previous years.
The sandwich shop chain closed 571 U.S. locations in 2022, adding on to the thousands of stores the franchise closed in recent years as it grapples with over-expansion, outdated operations and decor, stale menus and $5-footlong deals that hurt profits, according to an April 25 disclosure document obtained by Reuters that Subway provides to franchisees interested in purchasing locations.
The continued closures come as Subway is exploring a potential $10 billion sale of the company.
A refreshed menu and revamped advertising campaign with top celebrities were featured in the franchise's 2021 turnaround plan under Chief Executive John Chidsey, but restaurant consultant John Gordon told Reuters plans like this can take several years to succeed.
SUBWAY COMES UP WITH DEBT PLAN TO CLINCH $10 BILLION-PLUS SALE
Subway shut down about 2.7% of its sandwich shops in the U.S. last year. (Brandon Bell/Getty Images / Getty Images)
Franchisee advisor Robert Edwards also told the outlet continued store closings could impact public perception.
"That's baggage that they'll be hard-pressed to step away from," Edwards said.
Subway reported 20,576 locations in the U.S. at the end of last year, a significant dip from the 26,772 it had in 2016. The franchise has roughly 37,000 total stores across the world, but the U.S. is the franchise's largest global market by far.
SUBWAY SEES YEAR-OVER-YEAR INCREASE OF OVER 12% IN QUARTERLY SAME-STORE SALES AMID SALE EXPLORATION
Subway closed 571 U.S. locations in 2022. (Brandon Bell/Getty Images / Getty Images)
"We have spent the past two years optimizing our footprint by using a strategic, data-driven approach to ensure restaurants are in the right location, image and format," Subway said in a statement. "This includes opening new locations, with quality remaining a top priority, relocating restaurants to maximize guest traffic and closing locations when needed."
Despite Subway continuing to shed stores in 2022, the document showed the number of U.S. closures was fewer last year than in previous years with over 1,000 in 2021 and 1,609 in 2020.
The number of U.S. stores Subway closed in 2022 was fewer than in the previous two years. (Artur Widak/NurPhoto via Getty Images / Getty Images)
GET FOX BUSINESS ON THE GO BY CLICKING HERE
"The slowdown in closures is a result of the progress we have made to get back to smart growth, which will boost franchisee profitability and protect our position in the market," Subway said in a statement.
"In 2023, our goal is to increase new openings across North America by approximately 35% compared to 2022," the statement continued.
Reuters contributed to this report.