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Subway Franchise Disclosure Document Analysis
AI-assisted analysis of the 2021 Subway FDD. Every finding cited to the source page. Educational analysis only — not legal advice.
Key Red Flags Identified
No Exclusive Territory Granted and Unlimited Franchisor Competition Rights
Franchisees receive no protected territory, no radius restrictions, and no population-based limitations on where DAL can open additional Subway restaurants, including locations immediately adjacent to the franchisee's approved site.
Source: p.43
Sustained System Unit Decline Across Three Consecutive Years
US franchised outlet count fell from 23,799 at the end of 2019 to 21,147 at the end of 2021, a net loss of 2,652 units over three years, with 1,505 outlets ceasing operations in 2021 alone against only 550 openings.
Source: p.60
Renewal Requires Then-Current Agreement With Potentially Different Terms
To renew for a second 20-year term, franchisees must sign the then-current form of franchise agreement, which may contain materially different fees, standards, territory provisions, or operational requirements compared to the original agreement.
Source: p.52
🔒 5 more red flags identified in this analysis
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Item 19 shows earnings claims — but the full picture is in the other 22 Items.
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