NewHavenBIZ

16 n e w h a v e n B I Z | A u g u s t 2 0 2 2 | n e w h a v e n b i z . c o m Competitive Bite By Liese Klein A er nearly two years standing vacant, workers finally began renovating the longtime Subway sandwich shop on the New Haven Green in late July. e Subway logo was still stuck on the door even as the building's iconic 1930s-vintage glass windows were punched out to make way for a new business. Now the nearest place downtowners can get a classic, Connecticut-born Subway sandwich is a half-mile away on York Street near the hospital district. Several other restaurants are a short drive away, although the Subway on Whalley Avenue in Dixwell was listed on Google as "temporarily closed." Subway's retreat from downtown Subway revamps offerings as state's sandwich wars heat up New Haven seems emblematic of the chain's overall move away from its Connecticut roots in recent years. Subway founder Fred DeLuca opened his first eatery in 1965 in Bridgeport, spawning the world's largest restaurant chain, which topped 27,000 outlets in the U.S. alone at its peak. Long headquartered in Milford, Subway in June confirmed rumors that it was leaving its longtime headquarters at 325 Sub Way. Part of the mega-chain's operations are moving 10 miles away to Shelton, into a 90,000-square-foot office at 1 Corporate Drive in developer R.D. Scinto's Enterprise Corporate Park. But all customer-facing functions are moving in coming months to Miami, home of CEO John Chidsey, accelerating a steady decline in the Connecticut headcount. Chidsey told CNBC in May that he had actively recruited outside of the chain's legacy executive ranks to change Subway's corporate culture, making the company "much more risk oriented." Only about 30% of employees date from before he took over in 2019, he said. "It was a bit of a bloated organization so we slimmed it down dramatically," he added. e move from Milford — along with the closing of the Chapel Street restaurant — reflects a chain seeking new footing in the increasingly competitive sandwich market, industry experts say. Subway has been steadily winnowing its stores, closing more than 5,100 U.S. outlets since 2017. Underperforming restaurants and those located in stagnant retail markets have been targeted for closure. e owner of the Subway on the New Haven Green blamed the pandemic's hit on downtown foot traffic for the closing of his restaurant, which had been in operation at the site since 1996, according to the New Haven Independent. New look and branding To fight flagging pandemic-era sales, Subway has been revamping its U.S. branding and marketing, launching the "Eat Fresh Refresh" campaign in 2021. Sports stars and celebrities were signed to promote the chain's new menu, better quality ingredients and renovated stores. at campaign has seen results, with Subway reporting that U.S. sales outperformed projections by nearly $1.4 billion in 2021, with 75% of outlets reporting a 7.5% increase in same-store sales last year compared to 2019. Due to investments in online ordering systems and infrastructure in stores, digital sales also tripled in 2021 compared with 2019, rising to a total of $1.3 billion, Subway said. "e Eat Fresh Refresh campaign is part of our multiyear transformation journey to improve across all aspects of our business and build a better Subway," said Trevor Haynes, Subway's president for North America. "ere is more to come as part of our transformation journey." Part of the campaign is refurbishment of existing stores, Haynes said, with nearly 6,800 remodeled across the U.S. and Canada and 3,800 more stores slated for improvements for the rest of this year. "We are seeing excitement about the inviting, modernized look from guests, our franchisees and their team members," Haynes said. Staffing for the chain's U.S. restaurants also saw a boost from a national hiring campaign to attract 50,000 new workers to franchises. e rollout of the hiring campaign in June saw a 27% bump in the number of total job applications, according to Haynes. "e application process has been streamlined to make it easier for interested candidates to apply online and in-store," he said. A new slate of menu items was also launched this summer — the "Subway Series" — featuring 12 new combinations with new versions of cheesesteak, chicken, Italiano and club sandwiches. Promoted as a "whole new way to Subway," the new sandwich line was notable for its lack of customization — "Subway is encouraging fans across America to try the best sandwich they've never created," the chain said in a statement on the July 5 launch. In surveys, Subway customers said they found ordering a pre-designed sandwich more convenient, Haynes told the Associated Press in July. "e guest today has told us that they want us to change. ey want us to make it easier for them," he said. Going into the latest changes, Subway's share of the sandwich market had shrunk from 41% in 2013 to 28% in 2020, according to Restaurant Business, an online industry publication. Part of the cause is stagnation in the overall "limited- service sandwich" sector, but the rise in competition by similar chains also played a role, the publication said. at new competition can be seen clearly at locations across the New Haven area. In North Haven, a Jersey Mike's recently opened across Universal Drive from an established Subway. In Milford, a Jersey Mike's sits a few minutes down the road from a Subway, with a DiBella's Subs sitting in between them. Adjacent competitors like Panera Bread and local contenders like Waterbury-based Nardelli's Grinder Shoppe on Crown Street and Ray and An image from Subway's recent campaign to hire 50,000 new workers for its U.S. stores, which led to an increase in applications. PHOTO | CONTRIBUTED

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