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Sub and sandwich franchise revenue expected to grow, study says

IBISWorld has released a market report, the Sandwich and Sub Store Franchises, which according to a company announcement, shows that the industry has experienced consistent growth in line with economic recovery.

February 12, 2015

IBISWorld has released a market report, the Sandwich and Sub Store Franchises, which according to a company announcement, shows that the industry has experienced consistent growth in line with economic recovery.

The company attributed 2011 revenue growth in part to increasing consumer confidence in spending and also the success of Subway's five dollar footlong promotion. Franchisees maintained this momentum in the following years, according to the report, by developing menu options capitalizing on society's awareness of the health risks of a high fat diet.  IBISWorld expects industry revenue to continue to grow over the next five years.

Though many sub and sandwich stores usually fit the QSR category, dominated by giants like McDonald's and Burger King, millennial preferences have shifted.

IBISWorld Industry Analyst Will McKitterick said in a statement, "Millennials have turned increasingly to fast-casual restaurants to satisfy their hunger when dining out."

Companies like Chipotle and Shake Shack are taking a significant share of the market now, driving a dent into McDonald's long time dominance. Sub and sandwich shops have been able to thrive, however, due to their shift toward consumers' health and wellness concerns, such as Subway, known for low calorie options, IBISWorld said. This shift has allowed the industry to avoid many of the declines other QSRs are experiencing.

"In the coming years, industry operators will continue to face stiff external competition from members of the fast-casual food segment," said McKitterick.

IBISWorld expects sandwich franchises to continue to expand their menu options to include a wider variety of healthy foods.

The Sandwich and Sub Store Franchises industry report includes:

• Industry Performance 
• Executive Summary 
• Key External Drivers 
• Current Performance 
• Industry Outlook 
• Industry Life Cycle 
• Products & Markets 
• Supply Chain 
• Products & Services 
• Major Markets 
• Globalization & Trade 
• Business Locations 
• Competitive Landscape 
• Market Share Concentration 
• Key Success Factors 
• Cost Structure Benchmarks 
• Barriers to Entry 
• Major Companies 
• Operating Conditions 
• Capital Intensity 
• Key Statistics 
• Industry Data 
• Annual Change 
• Key Ratios