Subway Owners Rebel Against New Rewards Program With Profits Falling
- U.S. franchisees say store margins are being crunched
- Company is searching for new CEO after Greco stepped down
An employee passes an order to a customer at the drive-thru of a Subway Restaurants location in Princeton, Ill.
Photographer: Daniel Acker/BloombergThis article is for subscribers only.
Subway Restaurants, whose CEO is stepping down amid tumbling sales, is facing a backlash from store owners over its new customer-loyalty program.
Franchisees, who own and operate all Subway restaurants, say the company didn’t provide them with enough financial data to support the rewards program that the chain introduced this spring in the U.S. and Canada. They say they’re being charged a 1.9 percent royalty fee related to the program that hasn’t been financially justified.