Subway
Food & Beverage · Quick-Service Restaurants
- Active units
- 19,502
- Royalty
- 8.0%
Franchised, year-end 2024
of weekly Net Sales
About Subway
Subway® is an American fast food restaurant franchise that primarily sells submarine sandwiches, known as subs. The company was founded in 1965 by Fred DeLuca and Peter Buck in Bridgeport, Connecticut. Originally named Pete's Super Submarines, the name was changed to Subway® in 1968. It has since grown to become one of the largest fast food chains in the world. The headquarters of Subway® is located in Milford, Connecticut, United States. The building spans over 40,000 square feet and houses various departments, including marketing, operations, and research and development. The headquarters also features a state-of-the-art global training center. Subway® offers a wide range of sandwiches, salads, wraps, and beverages. Customers have the option to customize their order by choosing from various bread types, toppings, and sauces. Additionally, Subway® caters to different dietary preferences with options like low-fat and vegan choices. On a global scale, Subway® operates in more than 100 countries with over 40,000 locations. It has established various partnerships and subsidiaries, including Subway International B.V., which oversees the company's international operations. Noteworthy joint ventures include the partnerships with gas station convenience stores and Walmart locations, expanding the brand's accessibility. In terms of market position, Subway® has consistently been a major player in the fast food industry. It has been ranked as the largest restaurant chain globally by the number of locations. However, in recent years, the company has faced increased competition from other fast-casual chains and the evolving consumer preferences for healthier options. Throughout its history, Subway® has introduced several promotional campaigns and menu changes to drive growth. One significant event was the introduction of the $5 Footlong campaign in 2008, which gained immense popularity and boosted sales. The brand has also focused on improving its ingredients, including the removal of artificial flavors and preservatives. As of the latest updates, Subway® continues to adapt to changing consumer preferences by expanding its plant-based protein options and emphasizing freshness and customization. The company also invests in technology advancements, such as online ordering and delivery services, to enhance customer convenience. In conclusion, Subway® is a globally recognized fast food chain that offers a variety of sandwiches and salads. While facing competition, it maintains its position as a leader in the industry through innovations, marketing campaigns, and strategic partnerships. The brand remains focused on meeting consumer demands and staying relevant in the ever-evolving fast food landscape.
Key terms
- Franchise fee
$15k
- Additional franchise purchase
Reduced franchise fee of $7,500 for qualified existing franchise owners purchasing additional restaurants.
- Affiliate company franchise owners/Business Developers
Reduced franchise fee of $7,500 if qualified and in substantial compliance.
- Qualified Non‑Traditional location
Reduced franchise fee of $7,500 if eligibility criteria met; fee may be waived in certain oil company conversion scenarios.
- School Lunch & Community Development Programs
No initial franchise fee charged.
- Brand fund
4.5% of Net Sales
- Footprint
300 – 2,000 sq ft
- Veteran discount
50.0% off franchise fee — Reduced franchise fee $7,500 for qualified honorably discharged U.S. Veterans purchasing their first franchise.
Brand Percentile Rankings
Rankings compare brands in the same operating year. Fee and investment figures come from the FDD (2026 filing).
Growth
- Total locations19502
Franchised units open at year-end
- New openings435
Gross new units opened during the calendar year
- 1-year unit growth rate-3.1%
Net unit growth versus prior year
- 3-year unit CAGR-2.6%
Compound annual growth rate of unit count over the trailing 3 years
- Unit growth ratio3.0×
Cumulative opens / closures through year-end
Unit economics
- Annual unit volume (Median)—
Per FDD Item 19 disclosure
- Annual unit volume (25th percentile)—
Per FDD Item 19 disclosure
- Annual unit volume (75th percentile)—
Per FDD Item 19 disclosure
- 1-year Median AUV growth rate—
Year-over-year change in median AUV
- Store-level EBITDA Margin—
Median unit-level EBITDA / AUV
Investment profile
- Estimated initial investment$447k
Midpoint of estimated initial investment range
↓ Lower is better - Time to open—
Midpoint of average time from agreement to opening
- Royalty rate8.0%
Percent of net sales paid to the franchisor
↓ Lower is better - Sales-to-investment ratio—
Median AUV / estimated initial investment midpoint
- Cash-on-cash returns—
Median unit-level EBITDA / estimated initial investment midpoint. Steady-state estimate; year 1 returns will be lower as the unit ramps to median volumes.
Franchisee healthLocked
- Unit closure ratio
- Transfer vs. closure ratio
- Percent multi-unit franchisees
- Litigation rate
- EBITDA multiple on sales & transfers
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