January 13, 2023

Today's Topics

Hello! If you're superstitious, or even just a little-stitious as Michael Scott would say, you'll be nervous to hear that today is Friday the 13th. That's the first of two that we'll have this year (the next is in October). Ironically, it may be a good day to play the lottery. Today we're exploring:

  • Sub Counts: Subway is shopping itself around.
  • Grounded: How many flights actually make it to their destination on time?
  • The Inflation Gyration: Energy prices are letting up.
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Sandwich artists

Sandwich specialist Subway is exploring a sale, eyeing a deal that the Wall Street Journal reports could value the chain north of $10bn.

The news comes at a time when Subway’s business is looking fresh, having reportedly posted record sales in 2021 and 2022, after roughly a decade of stagnation.

Subway started life in 1965 as Pete’s Super Submarines in Connecticut, co-founded by then 17-year-old Fred DeLuca and family friend Peter Buck, who loaned DeLuca $1,000 to start the business to try and pay college tuition. Running each store themselves, the pair successfully opened 16 shops in less than a decade, but things were taken to the next level when they began franchising in 1974.

Sub counts

Since then, Subway has managed the brand carefully, positioning the chain as a healthier alternative. That branding, combined with a lean franchise model, propelled Subway towards the top of the franchise food chain — meaning that any potential acquirer will get a company with more than 21,000 sites in America (per QSR), 30% more than second-place Starbucks.

Indeed, setting up a Subway franchise reportedly costs somewhere between $100k-250k, a fraction of what’s needed to set up a McDonald’s equivalent — where costs can exceed $2 million.

However, although each store requires a lower upfront cost, they also sell less. A typical Subway pulls in a relatively-meager ~$440k of sales-per-store, the second-lowest in the QSR 50. Low costs also mean that Subway stores pop-up constantly, which means stores can find themselves “eating from opposite ends of the same sandwich”, hurting sales for both.


An FAA tech meltdown sent the air travel world into chaos on Wednesday, with well over 10,000 flights delayed or canceled by 6pm ET.

The source was said to be a damaged database file (we know the feeling) that impacted the Notice To Air Mission system, which alerts pilots to conditions that could affect their flight and is obviously pretty important, causing the first nationwide air traffic suspension in the US for more than 20 years.

Canceled flight club

Flight delays and cancelations have been a bit of a running theme through headlines in the last month. Indeed, 2023 got off to a turbulent start across the aviation industry and Southwest Airlines customers had a particularly torrid time over Christmas as the company struggled to adapt to winter weather.

Disruptions, as anyone who’s anxiously studied a departure board will tell you, are hardly an uncommon experience. Indeed, since 2018 just under 20% of all arrivals in the US were delayed or canceled, with a staggering ~42% of all arrivals for the month of April 2020 canceled as Covid-19 spread, more than double the 20% of flights that were canceled in the wake of 9/11.

Ancient systems seem to be a constant throughout the recent stoppages. Southwest's meltdown was blamed on inadequate software and the core system responsible for this week's disruptions is reportedly from the 1990s.

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Welcome back to day 522 of the inflation story.

The headline Consumer Price Index (CPI) rose 6.5% in December, down from a reading of +7.1% in November.

For the glass-half-full folks: This marks the 6th month in a row that annual headline CPI has dropped since the pace of price rises peaked in the middle of last year. Gas prices have returned towards “normal” and inflation in physical goods is dropping the quickest.

For the glass-half-empty folks: Core CPI, which strips out the prices of food and energy, making it a preferred measure of true inflation for some, stayed stubbornly high in December, rising +0.3% relative to November.

A rate-hikers guide to the galaxy

No one will have scrutinized the inflation figures closer than the decision-makers at the Federal Reserve. More hawkish members of the committee can now point to slowing inflation as a good argument to slow the pace of rate hikes, which have been among the fastest in history. Investors seemed cautiously optimistic, with stocks holding onto their modest gains from this week after the inflation numbers were released.

More Data

• America’s favorite pastime had a good 2022, as MLB pulled in a record-breaking estimated $10.8bn in revenue for the year.

Eggs didn't get the inflation memo, with prices soaring some 60% in the last year, as an outbreak of avian flu cracked nationwide supply.

• An Indian startup has introduced a $1,200 fine if employees contact colleagues who are on vacation, ensuring they can truly disconnect from work.

Prince Harry's book Spare is breaking records, selling 1.4m copies in its first day. Bestseller Becoming by Michelle Obama took a week to hit that number.


• A ranking of the most (and least) expensive appliances on your electricity bill.

8 years and 464 slices down, this man has summarized the NYC pizza landscape.

Off the charts: Which tech giant recently introduced unlimited vacation for their hard-working — as evidenced in our chart from last April — employees? Answer below.

Answer here.

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