What You Can Learn From the Failure of Subway

In the last 12 months, Subway has lost over 900 stores, which is the largest loss in company history! And yet, I’m sure you can still remember a time when Subway was completely dominating the fast food sandwich market. Heck, they managed to shove out Quiznos even though Quiznos had higher quality ingredients!

So what happened? Why is the Subway empire crumbling? How can you learn from their mistakes and protect the future of your own empire?

Well, I’ve been studying Subway for years and today I’m going to give you the top three lessons I’ve learned from my research.

Lesson 1: You Must Evolve

Take a look at the fast food landscape right now. Even if you narrow it down to just sandwich shops, Subway is losing ground to more innovative brands like Which Wich that offer better ingredients, even more customization, and a more modern look and feel.

And if you zoom out to the fast food giants like McDonald’s and Taco Bell, they are working on creating a look unlike anything we’ve seen in fast food before. They look more and more like modernized lounges where someone could actually sit and hang out.

The market wants to see change. Overtime, anything that stays the same literally becomes invisible. Your eyes scan right over it and look for the thing that’s new and different.

In the middle of all of this, Subway has barely updated their visuals, and they’re still clinging to their $5 Footlong. They haven’t done anything to surprise us, which is why they’re losing our business.

Lesson 2: Scandal Won’t Kill You

The situation with Jared Fogle is a perfect case study in how business leaders should handle a public scandal. Ironically, this is one of the biggest things Subway got right.

As soon as Jared Fogle’s crimes came to light, Subway immediately denounced him and cut all ties with him. Because of that, the public understood that they couldn’t hold Subway accountable for what Jared did behind closed doors.

So really, the Jared Fogle situation didn’t do much to change Subway’s long-term trajectory.


Lesson 3: Lack of Leadership WILL Kill You

Think about this for a moment: there are thousands of people who work at Subway, everyone from the sandwich makers to the CEO. What are the odds that none of those people have ever had an idea that could save the business?

Almost impossible, right? People are natural problem-solving machines. All those people must be noticing process improvements and product improvements left and right that could potentially turn things around.

So why aren’t those ideas being implemented? I can almost guarantee you that it’s a lack of leadership.

When a business has leaders who are communicate their vision clearly and lead by example, good ideas win. Team members are eager to share their good ideas and implement them quickly.

With poor leadership, good ideas get lost in the noise. Instead of working together to implement good ideas, the team gets distracted by personal drama and confusing instructions.

Subway is Not the Only One…

Our economy and our culture are going through a massive shift, and the truth is we’ve only witnessed the beginning of that shift. Other empires like Subway are crumbling. Other empires that you might think are un-killable will start to die out over the next five years.

We are moving away from an economy where businesses can get away with suitable products and services delivered in an impersonal way. The empires of tomorrow (maybe yours?) are being built by entrepreneurs who deliver excellent products and services with a personal connection.

Want to learn more lessons like these from the empires crumbling today? Want to build a legacy that will stand the test of time by avoiding their fatal mistakes? Click here to watch the latest episode of the Empire Podcast Show and discover more lessons like these!