6 Astounding Reasons to Quiznos Close 4200 Stores in a Decade.

Did you know that Jim Parsons aka Sheldon from Big Bang Theory, had his first acting gig in a Quiznos commercial?

Jim Parsons aka Sheldon from Big Bang Theory in Quiznos commercial
Johny Lambato

Johny Lambatos was a seasoned chef who started the Italian eatery Footers in 1978 and served as executive chef at the Colorado Mine Co. Steakhouse.

Footers was where he and his business partner Todd Disner, had an epiphany about making special sandwiches, like Italian deli style.

Fuelled by their past success with Footers and an intent to diversify their business, both of them made their dream a reality and opened the first Quiznos restaurant in Denver, Colorado, in 1981.

What Made the Brand Stand Out?

They started with a focus on “toasted” submarine sandwiches, which were unique at the time. The toasting method was instrumental in elevating the taste of sandwiches, it brought out the flavour of the meat and made the cheese taste better.

This small change in the recipes became an instant hit with food lovers and made Quiznos an overnight culinary success.

The first Quiznos Subs restaurant

What Made the Brand Stand Out?

They started with a focus on “toasted” submarine sandwiches, which were unique at the time. The toasting method was instrumental in elevating the taste of sandwiches, it brought out the flavour of the meat and made the cheese taste better.

This small change in the recipes became an instant hit with food lovers and made Quiznos an overnight culinary success.

Quiznos used these 6 Strategies for it Meteoric Success​

  1. Product Differentiation: Quiznos differentiated itself from other sub sandwich competitors by offering toasted subs. This was a unique feature at the time and created a distinct identity in the fast-food market.
  2. Franchise Model: Quiznos expanded rapidly through a franchise model.
  3. Location Strategy: Quiznos focused on opening stores in high-traffic areas to maximise visibility and accessibility, increasing foot traffic and brand awareness.
  4. Catering Services: They also offered catering services, which not only increased sales but also served as a marketing tool by introducing their products to potential new customers at events.
  5. Diverse Menu Offerings: Beyond traditional submarine sandwiches, Quiznos offered a variety of menu items including salads, soups, and flatbreads, appealing to a broader customer base.
  6. Brand Positing: Quiznos positioned themselves as a more upscale alternative to other sub-shops, focusing on high-quality ingredients.

Rick and Richard Schaden

Turning Point for Quiznos: Enter Father-son duo of Rick and Richard Schaden.

  • Right around the same time Rick and Richard Schaden had bought Quiznos franchisee and found it very successful.
  • They opened 3 more restaurant chains in as many years and took a bold call in 1991 to buy the entire business from Johny Lambatos.
  • This allowed Quiznos expanded to 12 locations in the US by 1987 and by the end of 2007. Quiznos had almost 5000 locations.
  • In February 1994, Quiznos went public. It made $4.4 million in its first public offering of one million shares of stock, priced at $5 a share.

Just when the brand thought itself to be unbeatable and started taking on global chains, it started crumbling under weak foundations.

6 Things The Brought the Demise of Quiznos,

  1. Unplanned Expansion and Selling to Everyone: Quiznos started selling to anyone and everyone, They had so many franchisees close to each other that they started eating into each other’s business.
  2. Supply Chain and Cost Structure: Their supply chain processes across multiple franchisees became even harder with scale of 5000 global locations.
  3. There were reports of workers stealing and under-invoicing the raw materials received at the locations.
  4. Unprofitable Franchisees: To make up for its operational challenges they were overcharging its franchisees by squeezing them for their net margins by forcing franchisees to buy raw materials from their designated suppliers at inflated costs.
  5. As a result 40% of their franchisees never made back their money.
  6. Growing Dissatisfaction in Employees: These predatory practices by Quiznos for its franchisees, the franchisee owners started cutting corners by
  7. Buying Low-grade food ingredients
  8. Capping employee salaries.
  9. Another major challenge for Quiznos was a misfired ad campaign. Quiznos launched the Spongmonkeys campaign, in 2004, intending to be quirky and memorable, which backfired. The campaign featured a bizarre, singing creature called Spongmonkeys a potato-shaped, human-toothed, rat like critters,
  10. The viewers hated the campaign, some calling it “downright gross”, making the potato Rats the worst-dressed mascot and the campaign being the worst misfire in marketing in recent times.
  11. Competition with Subway: Quiznos’s got competitive pressures from Subway. The rivalry with Subway simply exposed Quiznos’ vulnerabilities, especially in terms of its franchise model, cost structure, and market positioning.

Spongmonkeys, a potato-shaped, human-toothed, rat like critters

The Quiznos story stands as a pivotal lesson in the fast-food industry about the importance of sustainable expansion, franchisee relations, competitive positioning, and responsive business strategies.

Leading to Bankruptcy

  • Quiznos took on significant debt, which became increasingly unsustainable as sales declined.
  • The economic downturn in the late 2000s hit Quiznos even harder and the brand was slow to adapt its pricing and cost structure to changing consumer spending habits.
  • The Bankruptcy On March 14, 2014, Quiznos filed for Bankruptcy, while quoting that it would still continue operating while it brings its finances in order

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