Why is Subway changing from Coke to Pepsi?
Subway is parting ways with Coca-Cola after nearly two decades of serving the beverage company’s drinks at their store switching to Pepsi products.
Subway announced a major change for its roughly 20,000 sandwich shops in the United States. Starting 1 January 2025, as part of a 10-year agreement, it will be transitioning to serving up exclusively PepsiCo beverages.
“The partnership with PepsiCo is an exciting milestone in our journey to become America’s favorite place to eat, drink and work,” Doug Fry, President of Subway, North America said in a press release. The rollout will take place over several months and will end nearly two decades of serving Coca-Cola fountain drink products at its US locations.
Why is Subway changing from Coke to Pepsi?
The new partnership with PepsiCo “is a win-win for everyone” according to Fry. “It brings a delicious suite of beverage and snack choices to our guests, driving additional consideration of these menu items, while also providing cost-effective, streamlined solutions to our franchisees,” he explained.
The sandwich chain detailed that the deal will ensure “the brand’s beverage offerings align with guest preferences across demographics.” Subway franchisees will be able to offer a larger selection of Gatorade beverages along with PepsiCo’s diverse “consumer-driven assortment of beverages.”
The agreement also entails PepsiCo providing restaurants with all new beverage equipment, one of the features that will provide additional value to franchisees. Another is that Subway’s snack and beverage portfolio will be under a single supplier creating more efficiency across the system according to the company. Subway has had a longstanding partnership with Frito-Lay, which the sandwich chain announced in the same press release has now been extended through 2030.
Up until 2020, Subway has served Coke products exclusively at its stores worldwide. That was part of a 15-year partnership signed in 2003. That ended a situation where most stores had had Pepsi as their primary supplier of soft drinks, but not all.
However, after the agreement with Coca-Cola expired several regions around the world switched over to Pepsi products including Canada, Germany, the Netherlands and the Nordic countries. Subway has around 37,000 stores in 100 countries.