Posted on: Saturday, February 2,2002

Subway outlets overtake McDonald's

By Jessica Bujol
Associated Press

Subway manager Julia Duncan builds a turkey sandwich at the Subway outlet on Cooke Street in Kaka'ako. The privately held chain of sandwich shops has eclipsed McDonald's as the country's largest restaurant chain. Cory Lum • The Honolulu Advertiser

MILFORD, Conn. — There are now more places in this country to buy a B.M.T. than a Big Mac.

Subway Restaurants, the privately held chain of sandwich shops, has eclipsed McDonald's as the largest restaurant chain in the country.

The Milford-based chain operates 13,247 stores in the United States, 148 more than McDonald's as of Dec. 31. Subway, started by Fred DeLuca in 1965, opened 904 units last year, while McDonald's opened 295.

"We knew that we were getting close to McDonald's, but we had to wait until McDonald's released its information," said Les Winograd, a Subway spokesman.

The numbers include satellite locations — shops at gas stations, schools, sports arenas and other smaller outlets.

Winograd said Subway usually doesn't include the satellites in the count, but wanted to make sure its numbers were comparable to fourth-quarter figures reported by McDonald's, which included satellites.

McDonald's spokeswoman Anna Rozenich declined to comment on the number of stores, but did point out that in 2001, systemwide sales rose to $40.63 billion from $40.18 billion.

McDonald's still far outsells Subway and surpasses the sandwich shop in global presence. The fact that there are more Subway restaurants in the United States may be a boost in visibility, said Mark Kalinowski, a fast food analyst with Salomon Smith Barney.

"If you have a person walking down the street or driving along in their car, they'll see more Subways," Kalinowski said. "It's a convenience factor to have a lot of units open. But ultimately, from a financial perspective, it's not that big of a deal."