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Top 200 analysis: Old and new sandwich shops duke it out Joe Raedle/Getty Images News/Getty Images

Top 200 analysis: Old and new sandwich shops duke it out

But reports of Subway’s death are greatly exaggerated

This is part of a monthly series analyzing NRN Top 200 data, the industry’s most comprehensive ranking of restaurant chains and companies. Explore the full report.

A sandwich shop is more than what it puts between its bread. To stand out in a crowded field a brand needs to have a unique personality, and they need to evolve as necessary. They might want to offer fries, too.

“The sandwich shops that seem to be doing better, many of them have distinct brands, personalities, and have a thing they're known for,” said Alan Liddle, NRN's senior data and event content editor, who gathered preliminary data from NRN’s Top 200 on limited service sandwich shops.

“So, Jersey Mike's they try to be known for their community activism; Jimmy John's started the whole contemporary delivery movement. Firehouse Subs is run by two firefighters — that's very distinctive. They play it up, and they donate to their firefighting charities. Arby's is, you know, ‘We got the meat.’”

These LSR/sandwich chains, plus Potbelly all saw net new U.S. unit growth during the latest year. Potbelly has historically focused on urban growth, but in November they announced plans to slow development and close units.  

Arby’s is an outlier among these brands. It’s not new to the Top 200 like the others, but it has managed to adapt to changes in tastes.

“Arby's is growing. Up until recently, that wasn't true. They've turned themselves around,” said Liddle. Over the past three years Arby's net unit count has risen from 16 new locations — to 23 — to 46 in the most recent year.

“Their advantage is that they are different. They're selling some a sub-ish type product that's fresh. But they also have fast food hot sandwiches. And they're known for French fries, like some of the younger sandwich chains, like Charleys Philly Steaks and Penn Station East Coast Subs, which are both known for their fries. You won't find a fry in a Subway.”

Speaking of Subway. “Anyone who's talking about the demise of Subway is a bit premature,” said Liddle.

“You don't get to be that big, and you don't have those sort of resources and that sort of long time in the industry without having some ability to bounce back. I sometimes am amazed when people see a couple hundred units loss and then start talking about how it's the end of the game. There's still more than 25,000 subways in the U.S. alone, so. I wouldn't be writing their epitaph anytime soon.”

Subway still dominates the market share in their category. But an epitaph might be in order for Quiznos, at least for their presence in NRN's Top 200.

Although Quiznos’ net U.S. unit loss has gotten smaller in each of the past several years, the company still shuttered more than 100 units in fiscal 2017, which represents nearly a quarter of the brand's units just a year earlier

The losses Quiznos and Subway are facing are worlds apart. But Subway’s challenge is still notable because they are number one in their category. When Subway loses 3.3 percent of its U.S. store base that amounts to 836 units.

“So that's a pretty good net loss in units, no two ways about it,” Liddle said.

And on Thursday, Subway announced plans to close 500 more shops in the U.S., according to Bloomberg.  

But even these younger brands that are growing net units have slowed their pace over the past few years.

“The competition is impacting everyone, it would seem, or general market circumstances are causing people to slow their growth a bit, and those same forces may be exasperating the closure woes of Subway and Quiznos,” he said.

Contact Gloria Dawson at [email protected] 

Follow her on Twitter: @GloriaDawson 

Contact Alan J. Liddle at [email protected] 

Follow him on Twitter: @AJ_NRN 

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