Subway India, one of the largest restaurant franchisees in the country with around 800 outlets, has made changes to its menu that include removing the option of a free cheese slice. This move is seen as a cost-cutting measure rather than a mere change in taste.
In an effort to trim costs while keeping customers satisfied, Subway now charges an additional 30 rupees ($0.40) for the cheese slice in most sandwiches. However, they are offering a free “cheezy” sauce as an alternative.
Global fast-food chains in India, including Subway, have been facing pressure to reduce costs due to rising ingredient prices, especially for dairy products. Domino’s, for example, has expressed concerns over a 40% surge in the price of cheese during the previous financial year.
In recent weeks, many Subway and McDonald’s outlets in India have also removed tomatoes from their menus. This decision was made due to quality issues and a 450% increase in tomato prices, which reached record highs. To overcome the shortage, India has resorted to importing tomatoes from Nepal.
The free cheese sauce now offered at Subway India was developed with a focus on quality, according to Everstone Group’s Culinary Brands, which manages the supply chain for all 800 outlets. However, not everyone is pleased with this qualitative change. One customer, Sumit Arora, expressed disappointment on the social media platform X (formerly known as Twitter), stating, “You just lost a loyal customer” after Subway replaced the cheese slice with liquid cheese blend.
According to a Subway store manager in New Delhi, the cost of the new cheese sauce is Rs 400 per kilogram, whereas cheese slices typically cost around Rs 700 per kilogram in the market. Mayur Hola, the marketing head of Culinary Brands, emphasized that adding a cheese slice is still possible at an additional cost. However, the company did not comment on ingredient costs, stating that this change is simply an upgrade to enhance the quality of their subs.
Karan Taurani, a consumer discretionary analyst at India’s Elara Capital, stated that elevated cheese, grain, and vegetable prices have forced restaurants to come up with innovative strategies. He believes that the move by Subway is a way to exert inflationary pressure on customers without implementing a blanket price hike.
The cost of a Subway sandwich in India typically ranges from 200 to 300 rupees ($2.4 to $3.6). With the removal of the free cheese slice, adding it to the sandwich will now result in a price increase of up to 15%. Subway spokespersons have not responded to requests for comment on this matter.
India’s central bank recently raised its inflation forecast for the current fiscal year to 5.4%, citing pressures from food prices.