Jimmy John's Competitive Forces Model

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Jimmy John’s Introduction
The first Jimmy John’s was created in 1983 in Champaign, Illinois, by Jimmy John Liautaud. Liautaud founded Jimmy John’s on the idea of providing the gourmet sandwiches for a low price. The first Jimmy Johns was run out of a garage with used equipment, and without an ice machine for the drinks because there wasn’t any room. Liautaud grew interest in his sandwiches by giving out free samples to people around town, especially college students. As word spread about his sandwiches, Jimmy John’s began to gain acclaim and began to make money. (Gibbs, 2005)

1985 marked the opening of the second Jimmy John’s. Since then the sandwich shop franchise has continued to flourish with over 690 stores currently open nation-wide. The restaurant still bases its business on serving gourmet sandwiches with fresh ingredients. The difference between Jimmy John’s and the rest is that Jimmy John’s is “that it’s honest, it’s damn good, it’s damn fast, at a decent price.” (Jimmy John's Website, 2009) Jimmy John’s uses their fresh, unique bread and fresh ingredients to create a sandwich that is different from everybody else’s.

The competition in the restaurant business is very stiff, with lots of options available to consumers looking for something to eat. In considering the most direct competitors to Jimmy John’s target market, the restaurants that are considered as main competitors are other restaurants that specialize in sandwiches. These restaurants include Subway, Blimpie, Little King’s, Panera, and local delis.

The largest sandwich chain in the nation and Jimmy John’s biggest competitor is Subway. Subway currently operates 30823 restaurants in 88 countries. (Subway) Subway offers both hot and cold sandwiches on bread that is baked fresh daily. Customers are able to customize their sandwiches as they are made, adding ingredients varying from different cheeses, vegetables, and sauces. Subway has expanded their menu to also offer variations of their sandwiches in the form of wraps and pizzas. Subway also tries to be price friendly to their consumers with their five dollar foot long promotion.

Blimpie is another large competitor of Jimmy John’s. Blimpie has franchises that operate from coast to coast in the United States. Customers are able to order from a varied menu. Blimpie tries to differentiate their sandwiches from their competitor’s by always slicing deli meat for each sandwich immediately after the sandwich is ordered. (Blimpie)

Little King is a third sandwich chain that is franchised across the nation and competes directly with Jimmy John’s. As with Jimmy John’s and Blimpie, Little King focuses on the freshness of their sandwiches. Little King has a more varied menu than Jimmy John’s, offering items such as gyros and soups. (Little King)

A fourth direct competitor with Jimmy John’s is Panera Bread. Panera focuses on the quality of their bread much like Jimmy John’s. While their main focus is bread, Panera has a varied menu that offers café style foods, such as soups, salads and sandwiches. Panera does not focus on the “fast” aspect of the sandwich restaurants that directly compete with Jimmy John’s. (Panera Bread)

While these four establishments are the main competition for Jimmy John’s, in each market Jimmy John’s enters there will always be a few local competitors that will provide many of the same services. An example of a local restaurant that directly competes with Jimmy John’s in the Omaha area is Razzy’s Deli. Razzy’s offers a variety of sandwiches served hot and cold, and provides quick service that rivals the national, franchised sandwich shops. In most markets, these local delis will have a strong following of customers that will support their home-grown restaurant.

While all of these competitors offer some of the same products and services as Jimmy John’s, Jimmy John’s has been growing rapidly since its inception. The...
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