Franchise Times: Who’s taking a bite out of big sandwich chains?

Smaller sandwich chains like Jersey Mike’s Subs and Firehouse Subs have always been hungry for success, and now they’re taking a bite out of sandwich-slinging behemoths like Subway. According to research firm Technomic Inc., Subway’s sales suffered a 3.3 percent drop last year. As a result, burgeoning fast-casual sandwich chains have been filling not only a void in the market, but also Americans’ stomachs.

“Though still by far the dominant chain in the sandwich category, Subway’s sales drop is significant because it indicates its growth may have peaked,” said Mary Chapman, senior director of product innovation at Technomic.

With rising prices and the frequency of special promotions (ahem, $5 footlong) dwindling, Subway has struggled to keep a firm grip on a market that is being claimed by small sandwich franchises. After another year of record growth, New Jersey-based chain Jersey Mike’s has posted a 30.2 percent sales gain in 2014, the biggest boost in the Technomic report. Jersey Mike’s attributes its growth to “its culture of staying focused on the right kind of growth versus trying to grow too fast.”

Many different sandwich chains are bringing the heat; only time will tell if Subway and their peers will stay in the kitchen.