$6,000 Meat Slicers Disappoint Subway Franchisees

$6,000 Meat Slicers Disappoint Subway Franchisees

Subway’s Move to Compete with Fresh Deli Options Hasn’t Yielded the Expected Results, with Concerns over Labor Costs and Waste

Pretty much any way you slice it, Subway’s fresh deli meat initiative has not achieved resounding success, according to the North American Association of Subway Franchisees (NAASF). That group represents roughly 50% of Subway locations in North America.

Six months ago, Subway spent $6,000 for each slicer at the chain’s 20,000 U.S. locations in an effort to compete with fast-food sandwich brands that offer freshly sliced meats on their menus, CNN reported. The slicers are used for Subway’s Deli Heroes sandwich line-up, a key thrust of the 59-year-old chain’s attempt to attract and please customers.

Where’s the Data?

“We haven’t seen any data that says these slicers have driven sales, driven customer counts or profitability,” NAASF Chairman Bill Mathis stated in a podcast released by the trade publication Restaurant Business. “The bottom line here is that nobody is saying this is the greatest thing, if I may say, since sliced bread or since sliced meats.”

Mathis and his organization maintain that the slicers don’t have any impact on customer opinions. He said there’s “no data on what the consumer perception is on this or how they react to it. But just listening to our members, it’s really a mixed bag where some people really don’t care. It really doesn’t matter to them.” Customers at times have said, “You’re trying to be somebody else, another competitor, but you’re really not there. So nice try,” he added.

Labor and Waste Costs

Relaying what NAASF have told him, Mathis said some Subway locations are “struggling with [the slicers], but not everybody.” One problem with the slicers is that they increase labor costs because the slicers frequently require cleaning and because an employee must take time to undertake the extra step of slicing the meat before assembling a sandwich.

Mathis also cited a “waste factor” associated with meats sliced on-site – “wasting pounds in a week” in an industry with super-tight margins. A year ago, “we were taking it [the presliced meat] out of packages that would come to us, and the labor involved there is really nothing and the waste is little to nothing literally.”

The new sandwiches made from on-site sliced meats headline the revised menu that’s part of Subway’s “Eat Fresh, Refresh” initiative; the menu also offers new side dishes. In other efforts to revitalize, Subway has renovated restaurants to give them a more modern feel and has hired high-profile athletes to star in its commercials.

Past Franchisee Complaints

Subway franchisees have taken many of their beefs public during the past few years, saying the franchisor has treated them poorly. In a letter to Elisabeth DeLuca, a co-owner of the chain, anonymous “concerned franchisees” said their Subway dream “has turned into a nightmare,” CNN noted in its report. That letter said Subway had damaged their profitability by, for instance, awarding new franchises near their units or closing stores because of minor issues.

In a separate letter that also became public, Subway franchisees railed against high franchise fees. In response, a former Subway executive rebutted, calling the chain’s franchise fees “competitive.” Subway didn’t immediately respond for comment to the CNN report about NAASF members’ disappointment over the slicers.

Subway’s New Owner

Until 2023, Subway had been owned by its founders and/or their families since its founding in 1965 in Bridgeport, Conn. The private equity firm Roark Capital purchased the Subway chain for more than $9.5 billion late last summer. The deal represented one of the most expensive acquisitions in the annals of the fast-food industry.

Roark Capital also is majority owner of Inspire Brands, which includes Arby’s, Auntie Anne’s, Baskin Robbins, Buffalo Wild Wings, Carl’s Junior, Dunkin’, Hardee’s, Rusty Taco and Sonic restaurants.

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Mary Vinnedge is an award-winning journalist who has served as editor in chief, managing editor and senior editor at national and regional publications, including SUCCESS and Design NJ magazines. She also held reporting and editing roles at The Dallas Morning News and Charlotte Observer newspapers.

Before Mary began covering franchise news and trends as a staff writer for FranchiseWire and Franchise Consultant Magazine, she developed articles on topics ranging from lifestyle, education, health and science to home projects, horticulture, gardening, interior design and architecture. These articles included her reporting on academic news at her alma mater, Texas A&M University, when Mary worked in the marketing department of the Texas A&M Foundation. She continues to be a news junkie and subscribes to several publications.

Today Mary and her husband are empty nesters living on Galveston Island near Houston. The couple’s blended family – scattered around the United States – includes five children, four grandchildren and two very spoiled, very barky miniature schnauzer rescues.
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