Subway

History and expansion

Subway was founded in 1965 by 17-year-old Fred DeLuca with a $1,000 loan from family friend Peter Buck. Their first shop, Pete's Super Submarine Sandwiches, opened in Bridgeport, Connecticut. The holding company was named Doctor's Associates Inc., reflecting DeLuca's ambition to fund medical school and Buck's doctorate in physics. The name was changed to Subway in 1968, and the franchise model began in 1974 with a second location in Wallingford, Connecticut. The brand experienced rapid growth throughout the late 20th century, becoming a fixture in strip malls and urban centres across North America.

The first Subway restaurant outside the United States opened in Bahrain in 1984. The chain entered the Canadian market in 1986 with a location in St. John's, Newfoundland and Labrador. Expansion continued globally, with the first United Kingdom restaurant opening in Brighton in 1996. By the end of 2010, Subway had surpassed McDonald's to become the largest fast food chain in the world by number of locations. This growth was fueled by a relatively low startup cost for franchisees compared to other major chains.

The 2010s brought challenges, including the death of founder Fred DeLuca in 2015 and several years of declining sales and store closures in the United States. In 2019, John Chidsey became the company's first CEO from outside the founding family. A major transition occurred in 2024 when the founding families sold Subway to the private equity group Roark Capital for $9.6 billion. The deal followed a review by the Federal Trade Commission, which concluded the acquisition did not create an unfair competitive advantage despite Roark's existing ownership of other sandwich chains.

Corporate structure and operations

Subway operates almost exclusively through a franchise model, with all locations independently owned and operated. The overarching corporate entity is Subway IP LLC, which owns the brand's intellectual property. Franchising operations are led by Franchise World Headquarters, LLC. In different regions, franchising is managed by entities such as Doctor's Associates Inc. in the United States and Subway Franchise Systems of Canada, Ltd. in Canada. Advertising is coordinated through separate franchisee advertising fund trusts in various countries.

The company's international headquarters moved to Shelton, Connecticut, in 2023, occupying 90,000 square feet in the Enterprise Corporate Park. Prior to this, its headquarters were in Milford, Connecticut. Subway supports its global network through five regional centres. The European office is in Amsterdam, the Australia and New Zealand office is in Brisbane, Asian operations are supported from Beirut and Singapore, and the Latin American support centre is in Miami. This decentralized structure is designed to cater to regional market needs.

Franchise costs for a Subway restaurant start between $200,000 and $500,000, which is lower than many competitors. However, franchisees pay a royalty fee of around 12.5 percent of their sales back to the corporation, which is among the highest in the industry. The company has faced tensions with its franchise network over profitability, deep discount promotions, and mandatory operating hours. These issues have contributed to a net loss of locations in recent years, particularly in the United States.

The Canadian market

Subway first opened in Canada in St. John's in 1986. As of 2019, there were 2,881 Subway locations in Canada, giving it one of the highest concentrations of restaurants outside the United States. Canadian operations are managed by Subway Franchise Systems of Canada, Ltd. and the Subway Franchisee Canadian Advertising Trust. The Canadian menu has largely aligned with the United States, featuring core products like the B.M.T. sandwich. The Five Dollar Footlong promotion was also offered in Canada.

The chain introduced the SubDog in Canada in the summer of 2026 as a limited time offer. The Canadian segment was part of broader corporate shifts, including the 2024 sale to Roark Capital. In March 2024, Subway signed a 10 year deal with PepsiCo that began on January 1, 2025. This ended a partnership with the Coca Cola Company that was first signed in 2003 and went into effect in 2004.

Menu and products

Subway's core offering is the made-to-order submarine sandwich, prepared in front of the customer from a selection of breads, meats, cheeses, vegetables, and sauces. The best-selling sandwich historically is the B.M.T., which stands for 'Biggest, Meatiest, Tastiest' and contains pepperoni, salami, and ham. Beyond subs, the menu includes wraps, salads, and paninis. Breakfast items, flatbreads, and baked goods like cookies and muffins are also available. In 2024, Subway launched 'Sidekicks', a line of footlong baked goods developed in partnership with Cinnabon and Auntie Anne's.

The chain is known for regional menu variations that accommodate local dietary customs and religious requirements. In India, for example, Subway does not serve beef and offers an extensive range of vegetarian options, including all-vegetarian locations. In the United States, some kosher locations were opened, though only one remained operational in Miami as of 2023. Subway has also made efforts to address nutritional concerns, such as introducing gluten-free options in 2011 and reducing the salt content in its sandwiches.

Limited-time offers and promotional items are a constant feature. The SubDog, an American-style hot dog topped with cheese and sauces, was introduced in several markets after initial consumer demand following a 2022 April Fool's joke. Product testing, such as for crispy chicken sandwiches, often occurs in specific regional markets before a potential wider rollout. The menu is periodically refreshed with new items like the Italian Hero sandwich launched in 2017, which was advertised with a campaign featuring Italian-American characters and sportscaster Dick Vitale.

Marketing and promotions

Subway is the second-largest fast food advertiser in the United States. For decades, its marketing centred on the 'Eat Fresh' slogan, emphasizing freshly baked bread and ingredients assembled by 'Sandwich Artists'. A major early marketing figure was Jared Fogle, who became a national spokesman in 2000 after claiming significant weight loss from a Subway-centric diet. The company ended its relationship with Fogle in 2015 after he was charged and later convicted for crimes involving minors.

Following Fogle's departure, Subway launched the 'Founded on Fresh' campaign, which focused on the brand's origin story and ingredient sourcing. The company has utilized various high-profile advertising campaigns, including the 2021 'Refresh' campaign featuring athletes like Tom Brady and Serena Williams. Subway has also engaged in product placement, notably in the television series 'Chuck', where a fan campaign to save the show involved purchasing Subway sandwiches on a specific date in 2009. The company's marketing officer at the time called it the best product placement the chain had done in several years.

Promotional pricing has been a fundamental part of Subway's strategy. The 'Five Dollar Footlong' promotion, launched in 2008, became its most successful campaign ever, although it was later discontinued and replaced with varying value menus. Other common promotions include a rotating 'Sub of the Day' offering a discounted sandwich each day of the week. These value-focused promotions have driven customer traffic but have also been a source of tension with franchisees who saw their profit margins squeezed.

Recent challenges and developments

Since 2015, Subway has faced a period of contraction, closing thousands of locations globally, primarily in the United States. According to its 2026 franchise disclosure document, the U.S. system lost a net 729 restaurants in 2025 alone. This decline is attributed to several consecutive years of falling profits, reduced foot traffic, and franchisee dissatisfaction with corporate mandates and discounting strategies. The company has shifted its focus from aggressive expansion to revitalizing existing locations.

Major corporate changes have marked the 2020s. The 2024 acquisition by Roark Capital ended nearly six decades of family ownership. In 2025, Subway finalized a new 10-year beverage contract with PepsiCo, ending a long-standing partnership with Coca-Cola that began in 2003. Internationally, the brand continues to seek growth through master franchise agreements, such as a 2026 deal to add 300 restaurants across Central Europe and an expansion agreement in Panama. The company also faced specific financial challenges, including the bankruptcy of its Brazilian unit in March 2024 with nearly $100 million in debt.

As of September 2023, Subway has over 37,000 locations in more than 102 countries and territories. In 2023, the founding family announced they were selling the company, and on August 24, Subway announced that Roark Capital would purchase it. In 2019, John Chidsey joined as CEO and focused on improving established United States locations rather than building new restaurants. The company's strategy involves modernizing restaurants and refining the menu.

Questions about Subway

How many Subway restaurants are in Canada?

As of 2019, there were 2,881 Subway locations across Canada. The first Canadian Subway opened in St. John's, Newfoundland and Labrador, in 1986. The chain expanded rapidly throughout the country, becoming one of the most ubiquitous fast food options. Canadian operations are managed by Subway Franchise Systems of Canada, Ltd., and menus have traditionally mirrored those in the United States with occasional regional promotional items.

Who owns Subway now?

As of April 2024, Subway is owned by the private equity firm Roark Capital. The company was purchased from its founding families for $9.6 billion. Prior to this sale, Subway had been owned and operated by the families of founders Fred DeLuca and Peter Buck since its inception in 1965. The acquisition was reviewed by the U.S. Federal Trade Commission, which approved the deal after determining it did not create an unfair market advantage.

What is Subway's best-selling sandwich?

Subway's best-selling sandwich is the B.M.T., an acronym that originally stood for 'Biggest, Meatiest, Tastiest'. It is a submarine sandwich containing pepperoni, salami, and ham. The name was also a playful reference to the Brooklyn-Manhattan Transit, tying into the 'subway' theme. The B.M.T. has been a staple menu item for decades and remains a popular choice for customers seeking a hearty, meat-filled sub.

What happened to the $5 footlong promotion?

The Five Dollar Footlong promotion was launched in 2008 and became Subway's most successful promotion ever. It was initially a limited-time offer but was extended due to popular demand. Over time, the promotion was discontinued in various markets, including San Francisco in 2012 due to higher costs, and was largely phased out nationally by 2018 to improve franchisee profits. It was replaced by other value menus, such as the Simple $6 Menu, though limited $4.99 promotions have occasionally returned.

Why did Subway end its partnership with Jared Fogle?

Subway ended its partnership with longtime spokesman Jared Fogle in 2015 after he was charged with possession of child pornography and illicit sexual conduct with minors. Fogle had been a central figure in Subway's marketing since 2000, promoting weight loss stories tied to the brand's sandwiches. He later pleaded guilty and was sentenced to more than 15 years in federal prison. Subway subsequently launched a new marketing campaign called 'Founded on Fresh' to distance itself from the controversy.

Is Subway closing a lot of stores?

Yes, Subway has closed a significant number of stores, particularly in the United States, over the past decade. The chain closed more than 8,000 locations globally between 2015 and 2025. In 2025 alone, its U.S. franchise system experienced a net loss of 729 restaurants. This contraction is attributed to falling profits, reduced customer traffic, and franchisee challenges. The company's current strategy under new ownership focuses on improving the performance of existing locations rather than pursuing rapid expansion.

Sources: Wikipedia and current public reporting, checked by the Novello Desserts desk. Last updated 2026-10-18.