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Quiznos files for bankruptcy

Floundering Quiznos Files For Chapter 11 Bankruptcy

Sub shop Quiznos announced Friday that it was filing for bankruptcy. Choked by more than half a billion dollars of debt, the chain is restructuring, cutting almost $400 million of owed money, and, for the moment ... is toast.
Pundits say the downfall of Quiznos can be pinned on a myriad of problems, but one of the main causes seems to be the company's relationship with its franchisees, who are described as "acrimonious," "disgruntled," and "maltreated" by The Denver Post.

In 2009, a class-action lawsuit settlement forced Quiznos to pay $95 million to its independently-owned franchises, that, according to the Post, originally sued because expensive ingredients made it nearly impossible to turn a profit.

CEO Stuart Mathis promised to aid franchisees, writing in a statement, "We look forward to continuing to work with and support our global network of franchise owners, who are the backbone of our business."
Stiff competition has also played a factor in Quiznos downfall. Since 2008's national recession, an IBIS report says Quiznos restaurant numbers have dropped by over 50% while its competitors, like Subway and Jimmy John's, are thriving.

And according to Businessweek, since its popular Five Dollar Footlong deal began, Subway alone rocketed to 40,000 stores and is planning to open 10,000 more in the next four years.

Boasting higher quality sandwiches and toaster ovens, Quiznos soon discovered "that all most people want from a sandwich is to know that it's healthy and cheap."

The news comes after weeks of bankruptcy rumors, but the chain has already laid out a blueprint to get back in the sandwich game.
According to the Denver Business Journal, Quizno's will reduce its sub costs, offer loans to struggling franchisees and even provide new incentives for interested owners.
Perhaps they should work on their advertising strategy too, for who could forget those wacky singing rats. "The Quizno's subs! They are tasty, they are crunchy, they are warm because they toast them!"
That was weird. Anyway, despite the whole bankruptcy thing, nearly all of the sub shop's 2,100 franchises will remain open throughout the restructuring process.

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capttcwhittaker March 15 2014 at 9:03 AM

I ate at Quizno's once, had a reuben sub which was completely overpriced, bread was soggy and hard on the edges. I will take a Subway any day, always fresh bread.

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3 replies
Tom March 15 2014 at 8:45 AM

I ate at Quiznos once also. The sandwich was okay I guess, not outstanding, but it was small and really expensive. Never went back.

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Kern News March 15 2014 at 8:38 AM

I guess I am old enough to remember when they were called Submarine sandwiches in Hollywood. On my break from a theater I walked a few blocks down the boulevard and to a store that sold them, by having them ready, on the counter, wrapped in cellophane. They were about .45c and I ate them walking back to work. The bread was soft and they tasted OK better than the Subways today. Remember when the Subways were cut down the center of the bread? When they learned to cut them down like a sandwich, their sales went up.

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David and Jody March 15 2014 at 8:35 AM

Their marketing of their product had much to be desired. When they started having that rat running around in their commercials, it just turned me off.

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dbenbow361 March 15 2014 at 2:06 PM

My wife and I applied for and were granted a Quizno's franchise about 8 years ago. Before we paid our fees, however, we did a thorough "checking out" of the potential and down-side, including interviews with other franchisees. We learned all we needed to know quickly, and send them (Quizno's) a polite no-thank-you. We decided from the information we got that it was almost impossible to make money, and they gave you NO protection. A few months later, two different Quizno's stores opened in our little town of 60K population, (different owners, how about that for protection??) Within 2 years, both stores folded. Now, we have no Quizno's.

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COMMON SINCE March 15 2014 at 2:02 PM

I always thought the rats were one of the meats.

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bom327 March 15 2014 at 12:28 PM

Great product hope they come out on top!

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Lisa March 15 2014 at 8:17 AM

Personally I loved Quiznos. They closed all the stores within a 50 miles radius here. I think their biggest mistake was the franchisees. Each Quiznos (although the same organization) was run completely different. I heard people say things like "this is just a glorified subway". I prefer them over subway. Our Quiznos always had customers in it so I was shocked when without notice they just closed the store. I hate to see you go but unless you can improve your costs and customer relations you will NOT succeed in small towns across America nor will you expand your franchises. Good luck, I miss you guys!

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sdbizguy March 15 2014 at 2:19 AM

I used to eat their stuff until I saw it being taken from water which kept it warm and moist. That turned me off. There is a reason Subway is dominate.

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baldguy96 March 15 2014 at 8:10 AM

I got in to a big argument with a Quiznos employee once over him INSISTING that I have my sandwich toasted. I told him I didn't want it toasted ,I wanted it cold. He argued with me. I never went back.

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