Franchise of Subway

Topics: Subway, Fast food, Submarine sandwich Pages: 18 (3398 words) Published: April 3, 2010
1- Introduction4

1-1 Over View of Subway4

1-2 Franchise in Subway6

1-3 Subway Mission6

1-4 Subway Core Value6

2- Organization Structure7

2-1 Shareholders7

2-2 Management Team7

2-3 Employees7

3- Markweting Strategy7

3-1 Target Market8

3-2 Market Size 8

3-2 Market Growth10

3-4 Competition10

3-5 SWOT Analysis13

3-6 Market Mix Program15

3-6-1 Product Strategy16

3-6-2 Pricing Strategy17

3-6-3 Place Strategy18

3-6-4 Promotion Strategy18

3-6-5 Sales Promotion19

4- Financial Statement21

4-1 Sales Prediction21

4-1-1 Operating Hours21

4-1-2 Sales Per Hour21

4-1-3 Average Selling Price22

4-1-4 Methods of sells and Purchase23

4-1-5 Salaries24

4-1-6 Cost Of goods Manufacture25

4-1-7 Costs26

4-1-8 Tax Policy27

4-1-9 Break Even Point Analysis 27

4-2 Initial Investment 29

4-3 Sales Forecast30

4-4 Depreciation31

4-5 Operating Cash Flow31

4-6 Cost Of Capital 31

4-7 Evaluation Techniques33

References34

Appendix A35

Appendix B36

Appendix C37

Appendix D38

Introduction

In recent years, Subway may best be known for the advertising face of Subway who lost a great deal of weight, it is said, by eating healthy at Subway Sandwich Shops. In fact, Subway has now teamed up with the government to fight childhood obesity, opening another page in Subway history. Unlike KFC or MacDonald, Subway is famous for the fresh and healthy food. It is announced that there is low in saturated fat and no frying or greasy. Subway was found in 1965, but until 1974 they began franchising. Offering a fresh, healthy alternative to fast-food restaurants, Subway has franchises throughout the United States and in several countries, with locations in traditional and non-traditional sites alike.

In this report we are able to discuss how to set up a franchise of Subway in Kuala Lumpur and how it is struggling to survive in this intense competitive of fast-food market. In between, we will see how the efforts have put to start a franchise. The report is also covering the background of Subway, their marketing strategy and mission. Through the analysis of financial data provided, we are able to identify the size of shop, the location, the initial franchise fee and operational cost. Analytical recommendations and suggestions are provided so that our Subway franchise can be able to differentiate itself from its competitors and continue to sustain its competitive advantage within the fast-food market.1

4 Overview of Subway

Subway Sandwich shops began in 1965 when a recent high school graduate named Fred DeLuca decided he needed to find a way to pay for his college education. The original name of the shop is "Pete's Submarines," and then it changed to "Pete's Subway" when they realized that "Pete's Submarine's" sounded like Pizza Marines. Until 1974, they had owned 16 units of shops. At this time, Buck and DeLuca decided to focus on franchising as a way to open more shops. By 1978, just four years later, there were 100 Subway shops. By 1982, there were 200 and in 1987, they passed the 1,000 mark in franchise shop openings. That growth has continued. Subway Sandwich Shops has more units than even McDonald's. As of 2008 they operated in 87 countries with 30,000 shops open. The SUBWAY® franchise is the...

References: Mohammad Ghazi Ghazvini (MR081167)
Amir Afshin (MR091093)
Hamed Mehrzadi (MR091118)
Feng Jiazhen (MR081196)
Zhou Xing (MR091094)
Subway Franchising
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