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Subway franchise failure rate and unit turnover: what SBA loan defaults and the FDD show

Subway franchisees have taken 1,995 SBA 7(a) and 504 loans since fiscal 2010, totalling $466.5 million disbursed. This page reports how many of those loans failed, how Subway compares with every other franchise system in the SBA files, and where the failures were. Category: Food: sandwiches. Data as of June 30, 2026.

Below average

7.3%

of resolved SBA loans approved FY2010-2019 ended in charge-off (92 of 1,259)

All franchise-coded SBA loans9.5%

All SBA 7(a) and 504 loans7.6%

Subway vs franchise-wide0.77x

Charge-offs below the franchise-wide rate. Ranks at the 67th percentile of 104 brands with 30 or more resolved loans (higher percentile = more charge-offs).

92 of 1,259 resolved loans approved FY2010-2019 were charged off (7.3%), versus 9.5% for all franchise-coded SBA loans in the same cohorts (0.77x).
Dollars charged off equal 4.1% of dollars disbursed in those cohorts, versus 2.7% franchise-wide.
2 charge-offs so far among 196 loans disbursed since FY2022; most of these loans are still open, so this figure will rise.

Computed from SBA loan records as of June 30, 2026. Verdict date: September 3, 2026.

Subway SBA lending at a glance

1,995SBA loans approved since FY2010

$466.5 millionDollars disbursed since FY2010

99Loans charged off (since FY2010)

$15.2 millionDollars charged off

332Loans still open

$228,000Median loan size, FY2022-2026

120 moMedian term

51States with loans

403Distinct lenders

Program split since FY2010: 7(a): 1,892 loans, 504: 103 loans. Loan status as published by SBA: paid in full 1,257, charged off 99, still open 332, cancelled before disbursement 290.

Charge-off rate by approval year

SubwayAll franchise-coded SBA loans

Share of resolved loans (paid in full or charged off) that ended in charge-off, by the fiscal year the loan was approved. Bars with n under 20 are shown but not reliable.

How much SBA lending Subway attracts each year

SBA 7(a) and 504 loans approved per fiscal year for Subway franchisees, all statuses including cancelled.

Unit turnover from the franchise disclosure document

Franchised Subway outlets went from 20,576 at the start of 2023 to 18,773 at the end of 2025, a net change of -1,803 (-8.8%). Company-owned outlets at the end of 2025: 0. This is the franchisor's own count of units, covering every franchised outlet, not only SBA-financed ones, so it complements the loan data above.

Year	Franchised at start	Opened	Left the system	Net change	Net change %	Exit rate	Franchised at end
2023	20,576	Not available	Not available	-443	-2.2%	Not available	20,133
2024	20,133	Not available	Not available	-631	-3.1%	Not available	19,502
2025	19,502	Not available	Not available	-729	-3.7%	Not available	18,773

Source: Item 20 of the DOCTOR'S ASSOCIATES LLC franchise disclosure document registered with the Wisconsin Department of Financial Institutions, effective 4/30/2026, file 641453, filing record. Table 1 (systemwide outlet summary); figures are reproduced only where the published rows reconcile arithmetically.

Where Subway SBA loans are, and where they failed

Top 8 of 51 states by loan count since FY2010. The top three states hold 24% of the loans.

Project state	Loans	Charged off	Charge-off rate (resolved)	Approved
CA	198	11	7.9%	$57.1 million
OH	172	3	2.8%	$43.0 million
IL	118	10	11.4%	$31.0 million
NY	117	6	7.7%	$17.7 million
IN	100	3	4.5%	$33.6 million
WA	99	9	12.5%	$26.4 million
TX	99	11	16.9%	$37.5 million
PA	92	6	9.8%	$18.4 million

Recent loans, FY2022 to FY2026

241 loans approved since FY2022, $80.7 million disbursed, 2 charged off so far. These loans are young; the rate here will rise as they age and should not be compared with the matured cohorts above.

Among loans that were charged off since FY2010, the median time from approval to charge-off was 66 months, and 11% failed within three years (99 dated charge-offs).

The full Subway SBA loan report

Everything on this page plus the parts that let you check the numbers yourself: the loan-level file, the lender-by-lender record, and the largest charge-offs by name.

Every Subway SBA loan since FY1991: 6,172 records with borrower, city, state, lender, amount, approval date, status, and charge-off amount (CSV)
Charge-off rate by approval year, 2010 through 2026, in loans and in dollars
All 403 lenders with their Subway charge-off record
All 51 states, with rates
The 10 largest charge-offs: borrower, city, lender, amount, date
Median months from approval to charge-off, and the share that failed inside 36 months
New-business versus existing-business mix, 7(a) versus 504, and loan terms
Printable PDF plus the source-file citations for every figure

Get the Subway report, $49 See a sample report

Instant download after payment7-day refund if the file is not as describedNo account neededData as of June 30, 2026

Questions this page answers

What does the Subway franchise failure rate on this page measure?

The share of SBA 7(a) and 504 loans to Subway franchisees that were charged off, meaning SBA wrote the loan off as a loss after default. It measures loan failure, which is the closest public, brand-level proxy for business failure: a franchisee who repays the loan generally stayed in business, and a charge-off almost always follows a closure or sale at a loss.

Is a charge-off the same as a Subway location closing?

No. A charge-off means the lender and SBA took a loss on the loan. Most charge-offs involve a closed or sold unit, but a unit can close with the loan repaid, and a loan can be charged off while the unit changes hands. Treat the rate as a screening signal, not a census of closures.

Does this cover every Subway location?

No. It covers only units financed with an SBA 7(a) or 504 loan that the lender coded to the Subway franchise. Units financed with cash, conventional bank loans, or franchisor financing are not in the data. For Subway that is 6,172 loans since FY1991.

Why compare only loans approved FY2010 to FY2019?

Loans need years to resolve. A loan approved in 2023 has mostly not had time to fail or be repaid, so including it would understate the rate. Cohorts approved FY2010-2019 have had at least six and a half years as of June 30, 2026, which is long enough for most failures to appear. Later cohorts are shown separately and labelled immature.

Where do the numbers come from?

Every figure is computed from the SBA's public 7(a) and 504 FOIA loan files, as of June 30, 2026, downloaded from data.sba.gov. The methodology page lists the exact files, the fields used, and the franchise names matched to Subway. Nothing is estimated or modelled.

How current is this?

SBA republishes the files quarterly, about a month after each quarter closes. This page was generated on September 3, 2026 from the June 30, 2026 files and is regenerated when SBA publishes the next quarter.

Method, in brief

Failure rate = loans with status charged off divided by loans with status charged off or paid in full, for loans approved FY2010-2019. Loans still open are excluded from the denominator because their outcome is unknown; cancelled and undisbursed loans are excluded because no money moved. The franchise-wide benchmark uses the same formula over every loan in the SBA files that carries a franchise code (39,850 resolved loans). Loans were matched to Subway by the SBA FranchiseName field, covering these spellings: SUBWAY SANDWICH SHOP (4878); SUBWAY (1294). Full detail on the methodology page.

A charge-off is a loan outcome reported by the lender to SBA, not a statement about the franchisor. Units financed without SBA loans are not represented. Small cohorts are noisy: a rate built on fewer than 30 resolved loans is labelled as such and not banded. Missing values are shown as "Not available", never as zero.

Other food: sandwiches franchises

Jimmy John's Below average
Firehouse Subs Typical
Jersey Mike's Low