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Subway Celebrates a Year at the Top of the World


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All Photos Courtesy of Flavin Photography

If you want to visit the Subway in Utqiagvik, Alaska, prepare for a long trip. 

The northernmost QSR in the country is celebrating its first year in business, but it’s not easy to get to. It’s more than six hours by air from the next closest Subway restaurant in Nome, Alaska. And Google simply says, “Sorry, we could not calculate driving directions” between the two restaurants, that’s because there are no roads to the town of about 4,400. 

Once you get there, there are no paved roads in Utqiagvik—they don’t bother paving because permafrost would ensure a quick demise for any asphalt. Most food is pretty expensive because everything must be flown in. And even that gets a little tricky. One afternoon, a massive, 450-pound bearded seal lounging on the runway forced the airport to shut down. Given the high cost of transportation, even the Subway location charges about $11 for a foot-long sandwich. That means a lot of area residents still rely on local foods like fish, seal, caribou and even hunt whales in the spring and fall seasons. 

While it’s remote, the area enjoys some high average salaries. Subway co-owner John Masterson said the median average is close to $70,000, driven by the largest local employer, North Slope Borough, the local government. The area is also key source of labor for oil and gas operations in the region.  

“You wouldn’t believe it, but this is probably one of the richest small population towns in America,” said Masterson. 

The remoteness isn’t the only operating challenge. Contrary to the typical busy summers and slow winters seen in the Lower 48, the area has a unique population shift. Much of the professional workers that come in to the school district or the local federally funded programs leave during the summer. So while the long, dark winters are pretty popular, the summer actually slows down significantly as some 25 percent of residents head back to the Lower 48 or leave town to work construction jobs for the oil and gas industry. 

The biggest challenge for Masterson, however, is a very common issue for every restaurant these days: labor. Despite paying $16 to $18 hourly, he said he churned through about 60 people through the year to keep the full compliment of about 11 needed to staff the restaurant. 

“A lot of people will come to town and work here or the grocery store to get situated, then start applying for jobs at the Borough,” said Masterson. “I’ve had people come for the first four hours then leave over lunch and never come back because they got a job offer.” 

But it’s still become a community hotspot, especially popular with the area kids and Borough workers. 

“They love it, they have really been supportive, we get a lot of business from the school district and the Borough,” said Masterson. “We can’t complain.” 

He said he’s able to funnel that success back into the community. Because there aren’t many billboards or radio stations to spend ad fund dollars on, it goes right back to the local kids. 

“We do a lot of stuff for the schools,” said Masterson. “We ordered water bottles for all the athletics and cheerleaders. New bibs and stuff for the cross-country team, and we’re buying new uniforms for the city kids basketball league.” 

From the perspective of anywhere else, even Nome, Alaska, it's funny to think of Subway and its more than 25,000 locations as some novelty. But for one of the most remote and unique places in the country, it’s become a community lighthouse and Masterson is eager to see what’s next. 

“It’s been quite the adventure,” said Masterson. “But we’re doing pretty good.”

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Tom KaiserTom Kaiser is senior editor of Franchise Times. He can be reached at 612.767.3209, or send story ideas to tkaiser@franchisetimes.com.
 
Beth EwenBeth Ewen is editor-in-chief of Franchise Times. She can be reached at 612.767.3212, or send story ideas to bewen@franchisetimes.com.
 
Nicholas UptonNicholas Upton is restaurants editor at Franchise Times. He can be reached at 612.767.3226, or send story ideas to nupton@franchisetimes.com.
 
Laura MichaelsLaura Michaels is managing editor of Franchise Times. She can be reached at 612.767.3210, or send story ideas to lmichaels@franchisetimes.com.
 
Mary Jo LarsonMary Jo Larson is the publisher of Franchise Times Magazine and the Restaurant Finance Monitor.  You can find her on Twitter at
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