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PESTLE/PESTEL Analysis of Subway Restaurants

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Customers in more than 100 countries, walk into Subway for their delicious, healthy options. It’s likely one of the first restaurants to pop into your head when you’re craving something low-calorie, easy, and healthy for dinner.

The company boasts their vast selection of fresh, healthy meats and bread. Their slogan is “eat fresh” after all. And health-conscious customers adore it.

But that doesn’t mean the company hasn’t faced challenges. Especially after a certain spokesperson of theirs was convicted of a heinous crime.

This PESTLE analysis of Subway explores how the six external factors influence the company’s success.

Let’s start with the political factors.

Political factors affecting Subway: Food and safety guidelines

Subway is considered a fast food restaurant. And, like any business in the food industry, Subway must abide by political factors. Following the restrictions of the health and safety regulations is the company’s top priority. From packaging to distribution, Subway and their workers handle the responsibility of their food products.

However, health guidelines change based on a country’s specific policies. The regulations in the United States differ overseas compared to Muslim countries. There, most companies abide by a strict Halaal food restriction. If the food isn’t Halaal, it won’t be eaten by the general public.

Subway needs to make sure they’re following the rules in each location strictly. Otherwise, they may lose favor with their customers.

Subway economic factors: Customers happily buying subs

In the west, customers have more disposable income than ever. Add in the benefits of inexpensive options fast-food restaurants typically offer, and customers are happily spending money at places like Subway.

It wasn’t always like this though. Fast food sales were affected during the recession several years ago. Retaining customers was difficult; many were laid off or terrified of being laid off. At this time, fast food was more of a “luxury” purchase. People were counting every penny and spending it on only the necessities.

Subway didn’t make the cut.

Luckily, Subway has shown an ability to adapt to changing trends. They offer unique and healthy options for the general public. They’re a “saving grace” in a world filled with high sodium, high-calorie fast food.

Unfortunately, Subway did face a social backlash with their connection to a certain individual within the last couple of years.

Social factors affecting Subway: The “Subway” guy

For many years, Subway’s marketing campaigns starred a man named Jared Fogle. He quickly became dubbed “the Subway guy”. By eating only Subway, he managed to lose an excessive amount of weight. Considering Subway prides itself on being healthy, using Fogle as a literal “before and after” spokesperson was smart.

The ads with Fogle were incredibly successful. People knew him the moment he popped onto the screen. Others envied Fogle’s intense transformation; they yearned for an equally impressive weight loss.

Everything was all well and good… until Fogle was accused and then convicted as a child molester.

In those months, Subway quickly set a line in the sand between themselves and Fogle. Nothing tanks a brand better than being associated with a child molester, after all. Subway started a race to separate their identity with the Subway guy they created.

Subway still has the healthy angle working for them. They just don’t bring up their former spokesperson. Ever. And for the most part, Subway hasn’t suffered too much with their association with Fogle. But for months, it was difficult for the brand.

Subway technological factors: Easier marketing but easier bad publicity too

Changes in technology the quality Subway can offer their customers. The brand can now showcase their full menu online. They can also provide nutritional information about each offering, including the calories of individual meats, veggies, and bread of their meals.

Additionally, Subway can advertise their selection on social media. Many fast food places put video ads on platforms like Facebook and Instagram. And they converse with customers on Twitter. Answering questions and showing off new promos was once only possible through print and commercials. Now it’s easier to reach new audiences.

But the addition of social media isn’t always good.

It makes it easier for customers to complain. Or leave bad reviews. This amount of freedom for customers can be troublesome for Subway.  Because unhappy customers are stereotypically the most vocal online. The anonymity of the internet allows strangers to team up and complain.

Businesses have collapsed due to the influence of social media and consumers before. Subway has to be wary of how they manage, handle, and treat customers when it’s so easy to destroy a company’s reputation online.

Legal factors of Subway: Food management and food nutrition

Subway needs to follow food quality laws. This includes keeping an eye on packaging, distribution of food products, and waste management.

Quality must be maintained in their restaurants too. In many cases, workers must wear hair nets and gloves before handling any Subway food. If Subway can’t maintain proper compliance and hygiene of their workers, their stores will shut down.

Additionally, many countries require publicly displaying the number of calories of Subway foods. Although a legal requirement, it’s also something customers want. But it’s not a requirement in every country.

Subway’s environmental factors: A restriction on food additives

Bills and regulations pressure companies, like Subway, to adopt greener methods. This includes the management of food and monitoring how the food is grown. Some places criticize the use of pesticides and antibiotics in the meat served to their customers.

This concern has led Subway to change the use of additives in their foods. They wish to distinguish themselves against other fast food restaurants, like A&W, Sonic, and Jack’s, who were found to use antibiotics in their meat (in the United States).

Photo by Szymon Jarocki on Unsplash