Why our Subway stores are closing

DINING alone has been blamed for the closure of more than 130 Subway outlets across Australia, many of them in Queensland.

Stores in Brisbane, including the blue-ribbon inner-city suburbs such of Bulimba and New Farm, have shut, along with others across the state.

Analysts say Subway has failed to deliver the comprehensive dining experience that modern families want.

While other fast-food chains promote shared dining to attract groups, Subway has relied on low prices to get people through the door, according to a spokesman for consumer research firm Technomic.

Technomic - which has reported a drop in outlets from 1444 in 2015 to 1311 today - says over half of patrons are solo diners.

This translates into lower customer satisfaction and lower expenditure.

Technomic research shows Subway customers are considerably less likely than those of similar fast-food chains to consider the experience "excellent" or "unique".

Scores of Subway outlets have closed across Australia.
Scores of Subway outlets have closed across Australia.


A spokesman for Subway, whose national head office is in Brisbane's Fortitude Valley, declined to elaborate on the closures, but said: "Restaurant changes and relocations occur for a variety of reasons, including rental increases, site suitability and convenience, or lease completion."

Subway had no intention to reduce its restaurant footprint, but acknowledged it was operating in a market with more consumer choice than ever before.

Following the closures, Subway has been trying to woo customers with a range of incentives.

On August 1, it launched a new loyalty program, giving away six-inch subs to the first 100,000 people to sign up online.

It has also expanded its salad, bread and cookie offerings.

But analysts consider such initiatives as paltry when the chain has bigger problems around image, staffing and franchisees.

The beleaguered chain has recently come under fire from the Fair Work Ombudsman for underpaying staff, many of them teenagers.


A Subway outlet adjoining a 7 Eleven at Main Beach on the Gold Coast
A Subway outlet adjoining a 7 Eleven at Main Beach on the Gold Coast


Meanwhile, franchisees have vented online about being forced to buy substandard but more expensive products, and of stores being placed too close to each other, reducing trade.

Subway's local issues mirror those elsewhere in the world following the 2015 death of the chain's founder Fred DeLuca and the jailing of its former ambassador Jared Fogle for child sex and pornography offences.

Last year alone in the US, 1100 stores closed.

Subway was founded in Connecticut in 1965 by a then 17-year-old DeLuca, who borrowed $1000 to start a sandwich shop to help pay his way through university.

At the time of his death from leukaemia at age 67, DeLuca was reportedly worth $3.5 billion.

Subway's first Australian franchise was in Perth in 1988.

Despite its recent woes, Subway still has more outlets in Australia than McDonald's, however its takeaway market share is only 2 per cent, compared with 19.5 per cent for Macca's, according to IBIS World research.


* New Farm, Brisbane

* Toowong, Brisbane

* Bulimba, Brisbane

* Moorooka, Brisbane

* Mitchelton, Brisbane

* Hope Island, Gold Coast

* Coolum (Coolum Village), Sunshine Coast

* Coolum (David Low Way), Sunshine Coast

* Tewantin, Sunshine Coast

* Highfields, Darling Downs

* Biloela, central Queensland

* Charters Towers, north Queensland

* Townsville, far north Queensland

(Partial list)