Embattled sandwich chain Subway, which has closed hundreds of restaurants over the last two years and seen top leaders exit, has laid off 300 corporate employees at its headquarters.
“A reduction in workforce is never an easy decision but streamlining and simplifying our business with a smaller and nimbler workforce will help us react quickly to the changing needs of the business,” Alan Marcus, senior director of public relations, said in a statement.
Marcus did not elaborate on the changing needs of the business, only stating that the company needs to focus on its locally-owned franchised restaurants.
“We must do what we can to fully support our owners and our guests in every neighborhood in which we do business,” Marcus stated. “Our focus remains on ensuring Subway guests get great service and value at every restaurant they visit, our franchise owners get the full support and tools they need to help them grow and be successful and that we strengthen our overall business performance.”
Restaurant consultant Tim Powell said focusing on “location and consistency of product” is good because that’s always been Subway's wheelhouse.
“This is their strength,” he said. “I think their ‘eat healthy’ mantra continues to resonate through the culture while other competitors have taken that position.”
From a marketing standpoint, the Milford, Conn.-based company has taken a long time to regroup after it cut ties with former spokesman Jared Fogle, he added.
“They haven't found their footing,” said Powell, managing principal at industry consultancy Foodservice IP in Chicago. “From a macro standpoint, we see menu prices increasing while traffic continues to slide in the US. Many concepts will be facing this tough economy this year.”
The Subway layoffs come after a recent round of downsizing at corporate involving top leaders. In January, Len Van Popering, chief brand and innovation officer position, was let go.
“We are streamlining and simplifying our business by pushing talent and expertise closer to the regions in which we do business,” the chain said last month.
Other Subway departures include Bethany Appleby, Subway’s chief legal officer, and Ian Martin, senior vice president for Subway’s international division. In December, Chief Development Officer Don Fertman and Chief Financial Officer Dave Worroll, both veterans of the company, announced retirement plans.
The corporate downsizing began after the quick-service chain named John Chidsey as the company’s new leader. Subway had been operating without a permanent CEO since Suzanne Greco retired in June 2018.
The world’s largest restaurant company, by units, has been closing and relocating Subway restaurants as part of the company’s ongoing transformation program which includes store refreshes.
Subway saw U.S. locations drop 4.3%, or a net loss of 1,110 restaurants in 2018, according to Nation’s Restaurant News 2019 Top 200 census. The 100% franchised company has about 24,800 restaurants in the U.S.
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