Quiznos New CEO Dave Deno Speaks

Ok. Here is what we should do. Corporate gets a TARP loan from the govenerment and buys out distressed or closed franchizes. Corporate can pay...say $100K for a store still in business and say...$50K for one that has closed. Thus making them company owned stores. Corperations do this all the time. This would be a bargin for Corp. and a life line to franchize owners who are looking at 15 to 25,000 from this black Knight running around buying Quiznos. You know the knight isn't going to keep the Q name on them. He is buying the location. Again, I insist corperate get involved, SOMEHOW! We as owners were and are there for them. Even when corperate was on their BAM parties all over the world at our expence. HELP!!! Jim from Fargo

Dangerous Dave is out and they have the original lunkhead back in. Quiznos Corporation is all for themselves and no one else. Beleive me I know where of I speak! I'm a reovering Franchise owner. They are selling them to 3rd world refugees for as little as $3,000.00 & this is why quality and service is so bad.
They do these controversial commercials so they can get some coverage. Their budget is nil due to the fact that so many good owners are forced to close up, and being replaced by unqualified owners.
Incidentally for all those who say the subs are smaller than Sub-way, you are right but thy don't hide it. It clearly says that their subs are 5", 8" and 11".

I have personally forced two Quiznos into closure and am now working on my third I know an associate who just shut one down and I know that 9 others in the area all shut down...Trying to steal anothers thunder will get you struck by lightning suckers.

It is a shame what is happening to Quiznos. I became friends with a franchise owner about a year ago. The $5 head-to-head strategy vs. Subway was a disaster that Crisper's and Panera had the good sense to sidestep. Instead of pitching what is better about Quiznos food, Brenahan went full tilt with "Just as cheap as Subway!" I guess he doesn't realize how bad Subway food tastes. Maybe he doesn't know anything about sandwiches. The Quiznos menu is ridiculously confusing. No one knows what "Signature" or "Classic" means. The menu should use meaningful, easily comprehensible groupings. The entire sales process need to be re-engineered so a salesperson interacts with the customer to nail down the order - size, bread, meat, sauces, cheese, veggis - and get the money. The production employees then fill the order without interacting with the customer again. Quiznos corp appears to only care about getting their 11% while the franchisees are left to deal with fixed rent payments and no profit every month. This strategy will destroy the business. It is painful to watch the chain being destroyed by bad corporate management. My friend's restaurant is for sale now, like so many others.

Well, here's the latest about the world's fastest contacting QSR and it isn't pretty. Quiznos Franchisees Walloped by Recession For the Qtard who questioned me concerning how many Q restaurants are currently open; read the article and apologize. You shouldn't write degrogatory things unless YOU can back it up. I obviously can. Tricky Dick Emmett is mentioned in the story as Senior VP Dick rather than as Legal whatever Dick. It's not a good sign that a lawyer whose knowledge of running restaurants is even less than his law knowledge is answering questions concerning operations. Where was Dino at? Of course, Dino is an accountant whose knowledge of running a restaurant is probably no better than Emmet's. There is no magic bullet on the horizon for this chain. And when Quiznos starts promising variety and value franchisees start worrying. Q is already trying to mandate $5 larges and $3.99 small prime ribs. How much more "value" is left to offer? The problems with this chain are easy to dissect. The costs are too high, "Chef" Zach hasn't created a winner yet, the quality stinks, and the profits are non-existant for FRANCHISEES. Until the costs are inline with the competition - which means cutting at least 15% off the top - than this chain is will continue to disintegrate.

The current assault on the Quiznos system by David Dino, Greg Brennenman and the The Dicks isn't just limited to franchisees. Dino recently layed off 20% of the corporate Quiznos staff as the "fastest contracting QSR" continues to downsize. Now I feel bad when anyone loses his/her job, however, I know for a fact that the attitude of the staff in Denver concerning franchisees was very poor. When I was there for "training" most treated me like some kind of low level employee rather than an investor who had invested 250k into the Quiznos system. They consistantly tried to convince me and other new franchisees that high food costs, unaccounted for ad budgets, and agressive couponing and giveaways was how ALL restaurant systems operated and that if I objected it was because I didn't understand how to operate a business. They tried to sell the idea that "Penny Profits" and sales were more important than restaurant profitability as the measure of franchisee success. I knew better and they knew better. Now they're feeling the pain they have subjected franchisees to for all these years. I take it back. I don't feel sorry for this group of Qtards. What goes around comes around and I hope they enjoy losing everything they have trying to survive on $250 a week.

Well, another week, another voice mail and more empty promises. Promises to not cut quality - how could you cut the quality anymore than you already have? Pressured washed chicken parts in the meatball isn't as low as you can go? Pressed ham, pressed turkey, turkey meat pepperoni, turkey chile, canned quality soups. Promises to increase franchisee profitablity - of course there was nothing about cutting food costs. Only a big cut will tell franchisees that Dino is serious about franchisee profitability. Until then the talk about franchisee profitability is just that, talk. David Dino is an accountant. He has no clue how to run a restaurant, how to develop product; but as an accountant he does understand that high costs are killing off Quiznos restaurants at a frightful rate. That makes him no better than the Dicks.

Quiznos corp has made the HUGE mistake of competing against Subway, Jimmy Johns, etc. Our cheese and meat is fresher, cut daily and more expensive...theirs is processed and less expensive. We have 18 (that's right EIGHTEEN) dressings that we have to buy...they have 3 or 4. We have 10 different chips...they have 2 or 3 (I think). We carry 18 (that's right, EIGHTEEN) bottled drinks in our deli case...most Jimmy John's and Subways only sell fountain drinks and don't even have a deli case. We pay Muzac $46.30 every month for music while most Jimmy Johns and Subways just play an easy listening FM radio station with NO monthly charges. I can go on and on but I believe everyone gets the picture. The only comparison between Quiznos and Subway and Jimmy Johns is that we are all QSR's and sell subs. Quiznos corporate tries to compete with Subway while our cost of doing business is quite a bit higher then theirs is. On top of all this...Subway spends a lot more for advertising (cause they are so big that they can) and their marketing team is a lot SMARTER then Quiznos marketing team. Instead of coming up with some unique promotions or advertising, all they seem to do is what Subway does...not even considering the our increased cost of doing business. If anyone thinks that Quinzos is a QSR franchise, they are wrong. In reality...Quiznos is a Food Distribution business with FO's across the country not being partners, but rather....their CUSTOMERS. This could all be corrected but Quiznos Corp has NO intention of changing anything. They are making way too much money...most of which is ours and not our customers.

The approximate number of Quiznos open for business is 4400...and falling. That number, by the way, doesn't take into account the hundreds of additional stores that were churned by Q because of franchisees who were forced to walk away. This chain is dying and the promises don't work anymore. Mr. Dino, cut the costs of doing business to Subway and JJ's level and do it NOW if you want to save yourself, the chain, and the franchisees.

Deno says: I could never figure out why systems argue with each other when they should be united to beat the competition. Let’s get the system unified and behind the great Quiznos brand. I say: Unity goes both ways. If systems argue, chances are one side isn't listening. Deno's answer to uniting franchisees is by increasing multi-unit franchise owners that are more receptive to the corporate message. I say: If more single unit operators were profitable, you would've had an increase in multi-unit ownership. Deno: "My whole career has been about great relationships with franchisees." I say: Deno, you have a lot of work to do before you will see great relationships with franchisees in this chain. Even though you stated in a letter you will never recognize the TSFA, you could change your mind and maybe the healing process will begin a little quicker. I believe the TSFA has more members than corporate cares to recognize. Everytime they screw up, we grow. John Q. Public

"The biggest problem with these stores right now is that they opened stores very close to each other and we are stealing sells from each other. I was doing fine until they opened another store near mine." - Q Zee

Franchisors like putting franchises close together. Franchisors are paid royalty on top line sales. If there are two stores next door to each other, store one may take a 40% cut in customers and revenues while store two also takes a 40% cut. But the two stores combined may net the franchisor 30% more in royalties on sales. That's why territory encroachment isn't an important issue for many franchisors but such a practice can be the kiss of death for individual franchise owners.

Question: Are Q Zees working to grow their independent franchisee association to demand that territorial rights be put into their agreements?

Many years ago KFC franchisees formed the KFC franchisee association to press for such rights. In the beginning, there was war with the corporate head office. Many lawsuits. In the end, the independent assocation negotiated a deal.

KFC retaurants now have territory rights. If I recall correctly, units are guaranteed no other KFC within 2 miles or so much population. Of course, multi-unit operators can put their stores as close as they want to their own units.

Franchise Advisory Councils, comprised of owners selected by the franchisor to act as a go-between, historically do not negotiate such contentious issues. It seems only independent franchisee associations have the hutzpah to negotiate such onery clauses on behalf of their members. 

Are Q franchisees banding together? How many members does the Toasted Subs Franchisee Association have? Is their association working with other associations for help?

Or are the majority of Q franchise owners unconcerned about matters of territory encroachment until it happens to them?

This is just more of the same corporate BS or window dressing. I am a franchisee and they (corporate) are trying to put me out of business. I can tell you that I am barely surviving, but only because I don't follow their rules anymore. I don't do the $5,$7, $9 anymore. I don't open until 9:00 PM (because i have no customers after 8:00). I don't buy my produce from their vendors. I'm not posting their latest give-away specials, etc etc. I've saved myself thousands of dollars as a result; this has allowed me to stay open....for the moment. I encourage all owners to do the same. Here is an idea for Quiznos: the biggest problem with these stores right now is that they opened stores very close to each other and we are stealing sells from each other. I was doing fine until they opened another store near mine, despite my begging them not to. Now they are allowing the weaker stores to go under until we have stores with large enough territories to survive : a type of "natural selection" . Instead of letting all these stores go under, they should create a "relocation program" that assists existing and failing store owners to relocate to a less "crowded" market at the expense of Quizno's. Corporate will eventually get it's money back in the way of increased royalties, increased kick-back on food sales, etc. I realize this may be too "long-term" for these short-sighted idiots, but it's worth a mention.

Dave .. It seems that he dos not have clue about franchise profitability or discounting. Reducing the sandwich price is another way of discounting!!! Reduce prices for customer & decrease franchise owners profitability.

without benefit of ANY reduction in COGS is killing the individual store owners. This company seems to have a death wish, as so many stores have closed this year (600+?), and many more will not survive the holiday winter months. I ran a spreadsheet model of how much of a sales increase would it take for the $2/5/7/9 pricing versus my regular menu pricing, JUST to achieve parity. Answer: A whopping 26.3% ....... !!! In this economic climate, that high of a foot count and sales increase is just NOT doable. Deno is no different than anyone else that sends the Friday VM weekly one way communications. He states Q has gone away from couponing? With the $2/5/7/9 "mandated" pricing, EVERY guest that walks in thru the door has a virtual coupon in hand! This company is at a major crossroad, and as long as store operators are forced to buy products from AFD (Q owned food distribution company), they will never realize the true COGS that can be obtained in a free, competitively bid marketplace.

And I don't mean Prime Rib here folk. Connecticut now lists 35 open stores, however, the largest sales volume store (and one of the first to ever open in the state) recently just shut their doors). It still shows up on the Q site though....wonder why?? I was up in the Hartford area and was in the mall where they're located....and it's closed. Now that makes a closing rate of 17 out of a max of 53 stores...do the math...and this is just in CT. Face it....these clowns are liars when it comes to reporting the truths about their franchise system. When you mandate a price ceiling and don't lower your C.O.G.S. it spells disaster...it's just a matter of time now. And BTW, get rid of the Q advertising banners on this site.....it's just perpetrating the problem. "Don't get into bed with the sandwich devil"