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Setting up a SUBWAY franchise

Manish Bansal Kanika Juneja Khushmeet Mannat Padam

Fresh & Healthy


Made on the spot Less than 6g of fat Eat Fresh

SUBWAY
A. An American fast food franchise that primarily sells submarine sandwiches (subs), salads, and personal pizzas. B. One of the fastest growing franchises in the world with approx. 40,229 restaurants in 102 countries and territories as of April 2013. C. The global revenue is around $17 billion (around Rs 85,000 crore), against $500 million (Rs 2,500 crore) from Asia and $55 million (Rs 275 crore) from India. D. Largest single-brand restaurant chain globally E. Second largest restaurant operator globally after Yum! Brands F. Main operations office is in Milford, Connecticut.

Mission Statement
To provide the tools and knowledge to allow entrepreneurs
to successfully compete in the QSR industry worldwide by consistently offering value to consumers through providing great-tasting food that is good for them and made the way they like it.

Why setup a SUBWAY franchisee ?


SUBWAY offers several positive aspects such as: A. National and International advertising provides it recognision B. Portable and available on the go C. Simple to operate ( No cooking or frying ) D. Reduces the labour cost and the space requirement E. The restaurant is virtually adaptable to any location F. The complete service can be provided in as less as 250 sq.ft G. Offers healthy food options H. Low franchisee fee I. Low set up cost

FEASABILITY FOR OPENING A SUBWAY OUTLET

SWOT ANALYSIS

SWOT (Strengths)

Number of stores. Located throughout the world. Eat Fresh slogan. Store start up costs are very low. (Lowest that I could find in any restaurants) Partnership with the American Heart Association. Customers are able to watch food preparation. Inexpensive $5 foot long sub. Use of celebrities in their commercials.

SWOT (Weaknesses)

Employee turnover

high. Unhappy franchisees. Franchises fighting over having more control of restaurants. Meat portions smaller on subs. Employees lack product knowledge.

SWOT (Opportunities)
Continue global expansion Encourage more dining in. Agreement with franchisers
about business control.

Drive-thru introduction. Improve employee


satisfaction.

Employee training.

SWOT (Threats)

Food contamination Competition (Quiznos),


and fast-food restaurants offering subs recently.

Poor economy Unhappy franchisers Unsatisfied customers.

GRAND OPENING !!!

APPLICATION FORM

INITIAL RESPOSIBILITIES
THE FRANCHISEE :

Initial franchise fee Finding locations Leasehold improvement & equipments Hiring employees and operating restaurants Paying 8% royality to the company and a fee into the advertising fund.

THE COMPANY :

Access to formulas and operational systems

Store design and equipment ordering guidance


Training program Operations manual Representative on site during opening Periodic evaluation and support Informative publication

LOCATION PERFORMANCE
The most important factor for performance are : 1. Location of the franchise 2. How well is it run
Now to eliminate any kind of misunderstanding the company has a policy that no employee or agent can provide any projection as to potential sales , earnings and profitability

In order to get information one needs to fill in an application form and on approval in return on is provided with disclosure document and contact details of franchisees who answer queries.

SUBWAY INDIA : GENERAL BREAKDOWN

Location Opportunities
Franchise fee
$11,000+Taxes(approx. 6 Lac Rupees + Taxes)

Start-up cost
Rs.40-55 Lacs

Basic royalty Advertising royalty 4.5%

8%

Expenses and Revenues

16.20%

Royality and Food(40%)

Rent(13.2%) 8%

40%
Power And Insurance(4.6%)

Garbage,Tel,Office Expenses(1.6%)

16.40%

Salaries(16.4%)

Sales Tax(8%) 4.60%

1.60%

13.20%

Net Profit(Before Tax)(16.2%)

CONCLUSION

SUBWAY is growing by the day and with the global growth of the brand comes several opportunities. Plans to open a large number of SUBWAY outlets as India contributes 275 crore of the total revenue generated as of 2013 Opening period is only 7 months Space requirement and labor requirement is low which serves as a positive aspect

Financing services also available from a selected list made available by SUBWAY
Menu made for INDIAN outlets offer a variety of Vegetarian SUBS catering to the Indian Customers Also the advantage of low franchise cost and set up cost makes it an eye catcher.

NOW OPEN!!!!