Subway Submarines McDonald’s, Becomes Largest International Franchise

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In a franchise industry where the number of locations is one of the best measures of success, Subway just dealt a blow to the traditional king.

According to the Wall Street Journal, Subway had reached a staggering 33,749 restaurants worldwide by the end of 2010, surpassing McDonald’s 32,737. It’s a huge milestone for the sandwich shop, which has dominated the sub market in recent years on the virtue of rolling out healthy menus and affordable menu options to react to a growing interest among customers in eating healthy and not emptying their wallets to do so. They’ve also made securing franchise operating capital a relatively easy proposition for budding entrepreneurs.

Matt Sullivan, the franchise marketing manager at Direct Capital, said Subway has managed its growth the right way.

“Subway has been able to grow so quickly by allowing franchisees to find creative ways to get in front customers. This, combined with a commitment to fresh product and competitive prices, makes Subway one of the most attractive opportunities for franchise entrepreneurs,” Sullivan said.

McDonald’s still leads the market in revenues, reporting to the Securities and Exchanges Commission last month that they pulled down $24 billion in 2010. Subway isn’t all that far behind, though, according to the article:

Subway, which opened its first international restaurant in 1984, in Bahrain, expects its number of international restaurants to exceed its domestic ones by 2020, says Don Fertman, Subway’s Chief Development Officer. The chain currently has just over 24,000 restaurants in the U.S., where it generated $10.5 billion of its $15.2 billion in revenue last year.

This isn’t the last word in the franchise slugfest, of course. McDonald’s continues to grow abroad and, according to the WSJ, Starbucks plans to triple its presence in China in the near future. How do you say “two stores on every corner” in Mandarin?

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