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Neck and Neck

Being No. 1 in the franchise race has its advantages, but there will always be others nipping at your heels.

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This story appears in the January 2004 issue of Entrepreneur. Subscribe »

For so long, McDonald's has been known by millions of children, busy parents and working stiffs around the world as the king of franchises. Who'd have guessed that one day, another franchisor would consistently challenge the burger giant's title?

In 1988, Subway dethroned McDonald's as No. 1 in Entrepreneur's Franchise 500®, touching off a virtual tug-of-war for first place. Subway had done the unthinkable. And it soon became the only other franchise to prove it wouldn't give up the top spot so easily. For the twelfth time in the past 17 years, Entrepreneur has ranked Subway as the No. 1 franchise, once again keeping the crown away from McDonald's (which has only ranked No. 1 eight times). There's good reason for Subway's dominance. Its enterprising approach made Subway explode onto the franchising scene, and in 2004's Franchise 500®, it outnumbered McDonald's U.S. locations 15,874 to 11,533. Subway has risen to glory armed with an aggressive development plan that has let it capitalize on society's appetite for healthy dining and catapulted it ahead. But for every new victor, a contender waits in the wings.

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