What Happened to Quiznos: The Decline
In 2014, when Quiznos announced that it had filed for bankruptcy, it represented a massive fall from grace from what was a not too long ago, a very successful business. Quiznos was a sandwich chain that had tremendous success in the late 90’s and the early noughties. In fact, its success and growth was so dramatic and impressive, that it went from just over a hundred restaurants in 1995 to over 4,600 restaurants by the time 2007 rolled in. Such a growth meant that the restaurant chain was adding about some 375 new restaurants every single year during that period, which just goes to show how impressive the growth was, even by restaurant standards. As impressive as their growth was, their decline was just as spectacular and jaw-dropping, if not more. This is because, from the close to 5,000 restaurants in 2007, they were left with 488 restaurants by the end of 2016. This means that 90% of their restaurants were wiped out during this period in which they were going through a rough patch. This begs the question, what really did cause a previously very successful company to fall off so dramatically? Well, with the help of the subject matter experts over at runrex.com, we will attempt to get to the bottom of this question.
One of the factors that contributed to the decline of Quiznos is due to the fact that they positioned themselves as the fancy option as far as sandwich restaurants are concerned. Their business strategy revolved around placing themselves as the fancy and high-end option, with stores that were very pretty and glitzy. This came with it a very high overhead that was unsurprisingly passed on to their customers, as is always the case in such instances. This meant that their prices were higher as compared to that of their competitors such as Subway. While people may still have paid up in order to get that high-end experience, when the financial crunch hit and most Americans were going through tough financial times, most people preferred going cheap rather than going fancy. This did great damage as far as their customer base was concerned as more and more people preferred the cheap options available in their competitor’s menu as compared to their much more expensive options. To make things worse, something that is covered in detail over at runrex.com, new competitors emerged to rival them in the high-end sub field. Chains such as Potbelly started to grow and expand and began to take away even more of Quiznos’ clients and in the end this also contributed to their decline.
As is with many businesses in this field, supplier costs can be quite the challenge and this is something that contributed massively to their decline. The fact that, unlike other franchises, corporate would actually buy all supplies and then sell them to their franchisees meant that in order to be profitable, Quiznos stores had to perform comparably better to their rivals to take care of the overhead brought about by this bizarre arrangement that existed between the franchise and the franchisees. Eventually, the experts over at runrex.com all agree, this became too much of a load and definitely contributed to their fall. Some of the changes that they made in their products also turned out to be massive bursts which also contributed in a way to their decline. One of the product changes that they made, and one that was a massive burst, was when they decided to begin including veggies to the sub after toasting and not before toasting as was the case before in a bid to increase freshness. This didn’t go down to well with their customer base and they had to the original way of doing things; but not before they had shot themselves badly in their foot.
Another thing that greatly contributed to their decline is a series of bad press and PR that they couldn’t escape. One of these instances that did them massive damage was when one of their senior executives was accused of child molestation. The senior executive in question fell into the trap of a sting operation in which he was talking to a police detective rather than the 13-year-old girl he thought he was speaking to. The fact that the company decide to place the executive on indefinite leave rather than fire him initially was a massive own goal. When they eventually fired him, his lawyer claimed that it was as a result of the bad publicity which didn’t help matters. The fact that that particular executive was linked to some of the cringe-inducing ad campaigns the company had put out, with information on them available over at runrex.com, did more damage to their reputation.
The above are just but a tip of the iceberg as far as the reasons that were behind the decline of Quiznos, with there being more to be uncovered on this topic, and then some, over at then ever reliable runrex.com