Subway Restaurants CEO: Confident franchisees will survive coronavirus
Subway Restaurants CEO John Chidsey says 90% of franchisees have applied for small business loans and its economic model is strong enough to survive the coronavirus.
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A majority of Subway franchise owners have secured federal relief intended to help small businesses weather the coronavirus pandemic.
Subway Restaurants CEO John Chidsey said Wednesday that about 92 percent to 95 percent of franchisees have applied for aid either through the Paycheck Protection Program or the Economic Injury Disaster Loans program.
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When Congress created the $349 billion PPP in the economic-relief bill passed at the end of March, it directed the loans at companies with fewer than 500 employees. But restaurants and hotels were granted some flexibility in the legislation — so long as they employed no more than 500 workers at any single location, they could apply for the aid.
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While that loophole has drawn some criticism after major restaurant chains and public companies secured loans, Chidsey said the majority of Subway's franchisees are small operators. The company itself does not own any of its restaurants.
"We're really made up of franchisees who have two to three businesses," he said. "We're the ultimate small business owner."
Chidsey said about 80 percent of Subway's restaurants have remained open throughout the pandemic, even as a broad swath of the U.S. economy shut down to mitigate the spread of the virus.
"We're not doing great, by any stretch," he said. "But from a unit-staying-open perspective, I think we fared pretty well."
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