Subway CEO John Chidsey on Wednesday defended the corporate’s franchisees who utilized for small enterprise loans to assist offset the financial impacts from the coronavirus pandemic.
“We actually have 10,700 franchisees within the U.S., and on common they personal two eating places apiece,” Chidsey mentioned on CNBC’s “Squawk on the Avenue.”
“We’re the final word mom-and-pop, if you’ll, and completely woven into the material of native communities on the market,” he added.
Plenty of massive corporations, lots of them publicly traded, have in latest days been criticized for searching for loans via the Paycheck Safety Program. A few of the firms, akin to Potbelly and Shake Shack, have mentioned they are going to return the cash acquired via this system, which was created in March by the $2 trillion CARES Act.
The NBA’s Los Angeles Lakers, which acquired a $4.6 million loan, additionally mentioned it has returned the funds.
This system’s preliminary $349 billion was rapidly used up, and one other $310 billion was allotted final week.
Milford, Connecticut-based Subway is a privately held firm and is “100% franchised,” Chidsey mentioned.
Chidsey, the previous CEO of Burger King, mentioned he doesn’t know of one other quick-service restaurant chain with as many “small, one- or two-restaurant operators as we have now.”
“So PPP and applications like which might be vitally necessary to make sure that we are able to preserve these 27,000 eating places open,” Chidsey mentioned.
Chidsey advised Fox Enterprise earlier Wednesday that greater than 90% of Subway franchisees had utilized for both PPP loans or Financial Damage Catastrophe Loans, a separate program run by the Small Enterprise Administration.
Mark Cuban, the billionaire entrepreneur, has been crucial of huge corporations making an attempt to entry PPP funds, however he advised CNBC final week he believes restaurant franchisees ought to have entry to them.
“For company headquarters, no. For particular person franchisees, I haven’t got an issue with it,” he mentioned.