Why Subway is Dying While Jersey Mike's Rises
How does a brand with 3,000 stores get valued almost the same as a competitor with 36,000 locations? The answer reveals everything wrong with growth at all costs. Subway sold for $9.6 billion with 36,000 locations. Jersey Mike's sold for an $8.8 billion valuation with just 3,000 stores—only 8% less despite having 11x fewer locations. This isn't just a pricing anomaly. It's the story of two founders who made radically different bets 50 years ago, and those bets compounded into entirely different empires. Fred Deluca built Subway on a "fake it till you make it" philosophy—didn't turn a profit for 15 years, designed stores to be cheap and easy to replicate, franchised to anyone (including immigrants who failed basic literacy tests), created the lowest-revenue stores in QSR at $490K/year with predatory agreements. Result: Subway became the most litigated franchisor in America. Peter Cancro bought Mike's Subs at 17 after working there since 14, saw what a premium sub shop could be ($130K/week in sales), built Jersey Mike's by franchising only to superfans with 16-week training and obsessive quality standards. Result: $1.3M average revenue per store, franchisees who love leadership, and a brand that means something. The numbers tell the story: Since 2015, Subway closed 7,000 locations (28% of footprint) while Jersey Mike's tripled in size and grew per-store revenue 40%. One scaled into mediocrity through the franchise photocopier. The other compounded quality brick by brick. The ultimate franchising truth: How you grow is who you become. TIMESTAMPS: 01:09 - Two Founders, Two Philosophies: Fake It vs. Build It Right 03:52 - The Franchise Photocopier: Quantity vs. Quality at Scale 06:04 - The Economics Gap: $490K vs. $1.3M Per Store Revenue 08:43 - Culture as Competitive Moat: Hostile vs. Beloved Leadership 11:12 - The Reckoning: 7,000 Closures vs. Triple Growth Since 2015
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