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Subway, a prominent American restaurant chain with nearly 800 outlets in India, has made a significant menu change that eliminates the option of complimentary cheese slices in their sandwiches. The move, widely seen as a cost-saving strategy, now involves an extra charge of 30 rupees ($0.40) for a cheese slice. However, the chain is offering a free “cheezy” sauce as an alternative. The decision reflects the global pressure faced by fast-food giants to manage expenses while ensuring customer satisfaction, driven by surging ingredient costs, particularly those related to dairy products.
Concerns about ingredient costs have not been unique to Subway. For instance, Domino’s, known for its competitive pricing in India, witnessed a 40% surge in cheese prices during the previous financial year. Moreover, tomato shortages triggered by a 450% price spike prompted various Subway and McDonald’s outlets in India to remove tomatoes from their menus. As a remedy, India resorted to importing tomatoes from Nepal to alleviate the scarcity.
Subway’s introduction of a cheese sauce instead of free cheese slices was explained by Everstone Group’s Culinary Brands, which manages the supply chain for all 800 outlets. The move, however, received mixed reviews from customers. While some embraced the change, others expressed dissatisfaction on social media platforms. A Subway store manager disclosed that the new cheese sauce costs 400 rupees/kilogram, with traditional cheese slices typically priced around 700 rupees/kilogram.
Mayur Hola, Culinary Brands’ Marketing Head emphasized that customers can still opt for a cheese slice at an additional cost and added, “Ingredient costs are not something we comment on … this is simply an upgrade to make our subs better.” Industry analysts noted that rising cheese, grains, and vegetables costs have compelled restaurants to adopt innovative strategies. Rather than a universal price increase, these shifts are viewed as managing inflationary pressures while maintaining customer loyalty.
As a result of these changes, the cost of a Subway sandwich in India, which generally falls within the range of 200 to 300 rupees ($2.4 to $3.6), could increase by up to 15% for those opting to include the once-free cheese slice.