Is Subway the Largest Restaurant Chain in the World and Surpass McDonald’s?

When comparing the two most famous fast food giants, Subway and McDonald’s, many people often wonder which one is the largest restaurant chain globally. At first glance, Subway seems to have more outlets than McDonald’s, but when we dig deeper, the truth might surprise you.

Subway vs. McDonald’s: A Global Comparison

According to recent reports from BBC, CNBC, and company statements, Subway boasts 33,749 restaurants worldwide by the end of the last year. McDonald’s, on the other hand, has 32,737 outlets. However, when it comes to revenue, McDonald’s significantly outperforms Subway, recording a revenue of $24 billion last year, compared to Subway’s $15.2 billion.

Bigger Does Not Always Mean Better

It is often said that bigger is better, but in the case of fast food chains, sheer numbers do not always equate to success or profitability. In fact, Subway’s vast network of stores has led to some stores running out of business due to the split of profits among multiple locations.

The Largest Fast Food Chains in the World

According to the list compiled on Wikipedia, McDonald’s remains the world's largest fast food restaurant chain, with outlets in the U.S. and 119 different countries. The first McDonald’s restaurant opened in San Bernardino, California, in 1940, and has since evolved into a global sensation. McDonald’s maintains a standardized menu and signage, which is recognizable worldwide. On the other hand, Subway is known for its customizable menu, offering a wide variety of choices to appeal to various dietary preferences.

Profitability and Franchise Details

While Subway has a significant number of outlets, McDonald’s has demonstrated stronger profitability. Starting a McDonald’s franchise requires a substantial investment of around $500,000, whereas starting a Subway chain is much more affordable. The affordability of entering the Subway franchise market has led to a rapid expansion of the brand. However, this does not mean that Subway has a competitive edge in all aspects. As someone who has worked in both franchises, I have observed that a Subway can sometimes be understaffed and have limited knowledge about the menu, as evidenced by the incident where we visited a Subway in the Toronto business district late at night and found it nearly unrecognizable in terms of staffing and menu expertise.

Defining a Restaurant vs. a Snack Bar

There is an ongoing debate about whether McDonald’s and Subway should be considered restaurants. Many argue that they are more accurately classified as snack bars. A true restaurant typically offers table service, a diverse menu, tablecloths, and a chef. In contrast, both McDonald’s and Subway function more as self-service establishments, with a limited menu and no table service. This distinction is crucial in understanding the nature of these fast food chains and their market positioning.

While Subway has more outlets, its success is not solely based on the number of restaurants but also on its ability to remain competitive in a fragmented market. McDonald’s, with its global brand recognition, standardized offerings, and strong financial performance, remains the undisputed leader in the fast food industry.

Ultimately, whether Subway surpasses McDonald’s depends on how you define a successful restaurant chain. McDonald’s undoubtedly holds a more prominent position in terms of revenue, brand recognition, and global reach, making it the leading player in the fast food industry.