Fast food is nothing but pre-cooked meals that are produced in bulk and kept in readiness for any customers who want to buy it. Fast food is a commercial term wherein packaged food items or ingredients are sold to food joints, restaurants and eateries that either pre-cooked or frozen or preheated and served to customers who do not have the time to sit down and wait for their meal to arrive. People who don’t have time to spare for a meal is why the fast food industry has now become a multi-billion dollar industry.
Introduction into Subway – A fast food restaurant
Subs or sandwiches are one of the customers most preferable meals and the business has been growing consistently over the years. One such fast food chain of restaurants is Subway. The restaurant was founded by Fred DeLuca and Peter Buck on August 28, 1965, in Bridgeport, Connecticut, U.S.A with their headquarters based out of Milford, Connecticut, U.S.A
Subway India, is one of the largest and the most popular fast food chain in the world with outlets operational across the world than any other restaurant. It is an American based privately held restaurant that primarily sells submarine sandwiches, salads and cookies. The restaurant has barn designed in a such a way which has to build your own submarine sandwich and salad counters.
History of Subway
Subway India’s history can be better understood by breaking it into a timeline.
1965 – This was the year when Fred DeLuca and Dr.Peter Buck teamed up and opened their very first submarine sandwich shop in Bridgeport, Connecticut, U.S.A which was known as “Pete’s Super Submarines.”
1968 – This was the first time when the name Subway was used instead of Pete’s Super Submarines.
1974 – It was in this year that Fred and Peter decided to fast forward and grow their restaurant. They successfully opened their first franchise outlet in Wallingford, Connecticut.
1975 – The Chain’s well-known sandwich known as the classic BLT which was named after the Brooklyn-Manhattan Transit system was introduced. Later on, for its advertising campaigns, the name was changed to “Biggest, Meatiest, Tastiest.” The first Subway restaurant was opened in the state of Massachusetts.
1981 – Subway opened its 200th restaurant in Renton, Washington.
1983 – Subway was awarded Entrepreneur Magazine ranking SUBWAY restaurants as the “Number One” in the sub sandwich category for the very first time.
1984 – Subway expanded overseas and opened its outlet in the Middle Eastern nation of Bahrain.
2001 – The very first Subway restaurant opened in India, in Saket, New Delhi.
2003 – Subway restaurants started expanding its outlets to other cities in India.
2005 – Toasted Subs were introduced in the menu as a new option for customers who wanted their subs warm.
2007 – India opened its 100th restaurant in New Friends Colony, New Delhi.
2010 – Subway restaurant surpassed McDonald’s restaurants worldwide, by opening 33,749 restaurants.
2012 – Subway reached another milestone by opening the 250th restaurant in Coimbatore, Tamil Nadu.
2015 – On Women’s Day, two female franchisees opened Its 500th restaurant in Mumbai, India.
I think as you are interested in fast food related franchises, you should also check out Pizza Hut Franchise, before making your final decision.
What is Subway’s main USP?
Quicker fast food service restaurant chain in the world
Subway is considered as the No.1 fast food service restaurant as they have a counter where the customers can get their meals made with fresh ingredients and have it either at the restaurant or take it was a takeaway.
A healthy and delicious meal
Their fresh, delicious, healthy made-to-order submarine sandwiches are made right before them to increase customer delight and satisfaction. It produces nutritious subs at affordable rates.
High Brand recognition
With over 54 years in the business, Subway has always made their meals with the highest quality and fresh ingredients right before its customers thereby creating a strong brand image and recognition. Currently, there are 42,431 operational restaurants across 112 countries across the world.
Customise your own meal
One of the main unique selling points of Subway is that customers can customise their sub sandwiches according to their taste and preference. They can choose their own bread, vegetables, meat, sauces and whether they need their bread toasted or not.
Subway approved food distributor
All of the Subway franchise food orders are approved from an approved food distributor thereby ensuring that all the outlets have the best and highest quality food along with maximum savings. Subway has an Independent Purchasing Cooperative (IPC) that negotiates the low cost for goods and services without doing any compromise on quality standards and always ensuring value for money.
Benefits of owning a Subway Franchise
Be it the quality of the meal or the unique food items Subway offers, Subway restaurants gives you a great opportunity to start your very own franchise. Before we dive into the necessary details of how to set up your very own Subway franchise, let us know a little more about the benefits this franchise brings us.
1. Subway is one of the fastest and most popular growing fast-food chain restaurants in the world.
2. Meal preparation does not require any cooking, frying or grilling. It is all healthy and fresh ingredients cut and made right in front of your eyes.
3. It is a successful business with low investment, simpler operations, customisable floor plans and international and local support.
4. It is the 1st largest Quick Service Restaurant chain in India and 2nd largest in the world.
5. Subway has high brand recognition, loyalty and an extremely strong brand image, even after being in the business for 54 years.
6. Detailed training sessions are given along with on-going support from the headquarters, local development agents and field staff.
7. Subway provides Marketing support and Advertisement assistance.
8. Blueprints for your franchise outlet will be provided by the store design team along with recommended contractors that the other franchise owners have used. It is the final decision of the owner to hire a contractor to build the outlet.
What are the requirements for owning a Subway franchise?
The type of property required to set up a Subway outlet can either be in a mall or a stand-alone property which can be owned or leased. The floor requirement should be 350 Sq.ft of area for non-food court and 170 Sq.ft area for food court.
There are few skills/experience that is required for anyone who wants to be a part of the Subway franchise.
– The individual should have an entrepreneurial spirit.
– Should be well-committed and dedicated to building it into a successful and profitable business.
– The people should be a team player and should be able to adjust to the working environment.
– Should have the confidence to learn new skills and learn on how to overcome day-to-day challenges.
– The candidate should possess basic communication skills and how to operate the billing system.
What are the regions of operation
As of 2017, Subway has over 600 operational outlets in over 70 cities across the country. They operate from cities such as Delhi, Goa, Coimbatore, Tirupur, Chennai, Bangalore, Kolkata, Ahmedabad, Uttar Pradesh, Himachal Pradesh, Jammu&Kashmir, Bihar, Jharkhand, Pondicherry and many more.
– The franchise owner/manager can undergo a two-week intensive training program which will be offered by the company.
– Every outlet will be provided with an in-depth operational manual that will cover all the necessary topics that will be required to run the business.
– Depending upon your franchise location and language preference a training centre will be allotted to your outlet.
– A local development office will ask you to take two tests, focusing mainly on maths and English which generally takes about an hour to complete. It is mandatory for all the new joiners to complete the test.
What is the minimum staff requirement?
The minimum employees required to run a Subway franchise outlet is approximately 8 personnel.
Financial requirements and agreements required for setting up a Subway franchise
The total investment required for setting up a Subway franchise ranges from Rs.54 lacs – Rs.89,10,000.
The above investment Amount also includes the initial franchise fees of Rs.6,50,000.
Royalty and advertising fees
- Subway franchisees pay 8% royalty fees every week.
- 4.5% of the weekly gross sales goes towards advertising.
- Therefore Subway Franchisees have to pay a total of 12.5% every week.
The franchise agreement is signed for a period of 20 years and it is renewable once the term comes to an end.
Franchise’s profitability is explained through a hypothetical example
Total investment required for Franchise A = Rs. 50,00,000
• Rent paid monthly for a 300 Sq.ft of area = Rs.20,000
• Salary paid to 4 employees on a monthly basis (Rs.10,000*4) = Rs.40,000
• Miscellaneous expenses incurred in a month = Rs.5,000
Total expenses incurred in a month = Rs.65,000
• Average footfall of customers the franchise has in a day = 30 people
• Average amount per order billed in a day = Rs.300
• Total income earned in a day (30*300) = Rs.9,000
Total income earned in a month (Rs.9000*30) = Rs.2,70,000
Gross profit for the month (50% of Rs.2,70,000) = Rs.1,35,000
Total profit for the month (Rs.1,35,000 – Rs.65,000) = Rs.70,000
You can recover your entire investment within 5-6 years of setting up your franchise outlet.
Subway has come a long way since 1965 to reach the number one position in the Quick Service Restaurant category of the food industry. The variety of customizable meals that are offered to customers have created a huge fan base and has also given the company a strong and popular brand identity all over India.
Subway is an established brand all over the world and when you become a part of the Subway family by owning a franchise, the brand name is one of the benefits that drive your business into the path of profitability. Subway has always focused on customer delight and sells unique items that keep attracting more customers. Another aspect that leads to an increase in your outlet sales apart from its brand is the quality of products that are used by Subway.
Keeping all these advantages in mind owning a Subway franchise in India will only increase your business and make you more profitable.