QUIZNOS: Franchisees Lost $2.25 per Sub on Giveaway

Discount promotions are one of the most contentious areas of the franchisor / franchisee relationship.  (Especially when it comes to Quiznos)

The reason is simple:  Franchisors make money off the gross sales of their franchisees, regardless of franchisee profitability.  Some franchisors make additional money marking up ingredients and food products to their franchisees.  Public franchisors benefit from higher sales – and stock prices – that are not tied to franchisee profitability.

SmartMoney.com surveyed franchisees from different franchise chains regarding the cost to them of some current and recent promotions. The Smart Money article points out that franchisees generally bear the brunt of a promotions’s cost, including the food, labor, rent and utilities, among other things.

One of the most contentious examples was the Quiznos Million Sub Giveaway.  Here’s the Smart Money finding for Quiznos, which report a $2.25 loss per sandwich:

Quiznos

Promotion: Million Sub Giveaway – The first million people to register for Quiznos’s Q Club received a coupon good for any sandwich. (Certificates for this promotion expired by March 15, 2009.)

What some stores normally charge: $5.29 (one six-inch chicken sandwich)

Promotion Price: Free

Bottom line for restaurant: Loss of roughly $2.25 a sandwich

"The response to Quiznos’s Million Sub Giveaway was tremendous — with all one million free sub certificates requested within three days of the launch," says a Quiznos spokesperson. While Quiznos claims to have reimbursed franchise owners for food and paper costs, which amount to roughly $2.25 for, say, a chicken sandwich, other costs including rent, utilities and labor fell to individual franchisees — leaving some franchisees with an average loss of roughly $2.25 per sandwich, according to a franchisee in Maryland.

RELATED POSTS:

SUBWAY: What Do Franchisees Make on $5 Footlongs?

LITTLE CAESARS: What Franchisees Make on a $5 Pizza

McDONALD’S: What Franchisees Make on a $1 Burger

BASKIN ROBBINS: Franchisees Lose $1.45 per Scoop on Promo

QUIZNOS: Franchisees Lost $2.25 per Sub on Giveaway

BURGER KING Franchisees Sue Over $1 Cheeseburgers

WHAT DO YOU THINK OF QUIZNOS PROMOTIONS?  SHARE A COMMENT BELOW.

unhappyzee

Recent Posts

DonutNV 2nd Franchisee Daryl Poe Not Disclosed… Anywhere?

Daryl Poe was celebrated as DonutNV’s 2nd franchisee.  The local paper states that he operates…

7 days ago

DONUTNV Franchisee Mike Flowers Not Disclosed in FDDs?

I read a lot of Franchise Disclosure Documents (FDDs).  Most are pretty straightforward and make…

1 week ago

DonutNV Franchise Owners John & Dana Owens, Ocala, FL, Not Disclosed

In a video interview Franchise Sidekick celebrates their clients, John & Dana Owens, becoming DonutNV…

1 week ago

DONUTNV Franchise Owners Thomas & Rachelle Hughes Not Disclosed

DonutNV franchise owners, franchise locations and ownership transfers are normally included in a franchisor’s Franchise Disclosure…

1 week ago

DonutNV Franchisee Marc Schnobrich (Hilton Head, Savannah) May Have Left the System

Chiropractor Marc Schnobrich engaged the services of franchise broker Franchise Sidekick to find him a…

1 week ago

DonutNV Franchise Downgraded by Broker Group (?) as Franchisees Exit, Questions Grow

Brokers and advisors of Franchise Sidekick were among the most fervent promoters of the DonutNV…

1 week ago