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WRITTEN BY DENNY MCELLIS
One of the most recognized brands in the world and also one of the most popular, Subway, the legendary fast food sandwich joint has created an image that is synonymous with fresh food that is freshly prepared and has now overtaken McDonalds and in 2014 will see a projected store increase in South Africa of almost double its current store numbers with expansion into other African countries accelerated, says Debbie Martins, Area Development Manager Subway Sub Saharan and Southern Africa.
FRESH IDEAS, FRESH EATING
Last year the US-based Subway overtook burger supremo
MacDonalds as the franchise with the most number of outlets
worldwide with over 41,000 sites in one hundred and two
countries compared with 34,492 for McDonald’s. In recent years
Subway has made a major push into international markets with its
successful franchised business model emphasising small, low-cost
outlets.
Subway came to South Africa ten years ago and now has fourteen
franchise stores here with another twenty five projected for next
year. There are twelve outlets across Tanzania and Zambia, and this
year saw Subway opening the first store in the Kenya market, with a
second store opening in February 2013.
“Although we’ve been here sixteen years up till now there has
not been a strong focus on building stores,” says Randburg-based
Debbie Martins, Area Development Manager Subway Sub Saharan
and Southern Africa. “But this year we have implemented a national
marketing campaign. Our focus is to Build Sales, Build Profits, Build
Stores. We are very excited about the prospects of continuing to
building the Subway brand in South Africa and we feel the market is
right for Subway and the introduction of our growth strategy.”
From Argentina to Zambia, the Subway core menu - with cultural
and religious variations – remains essentially the same along with a
strong emphasis on freshness and customer involvement. As part
of its new South African push, campaigns are rolling out every eight
weeks, our focus is value, indulgence and customization.
SUBWAY SA
While many South Africans are increasingly cash rich they are also finding themselves time short. And with more and more women entering the work place and a breakdown of the nuclear family, South Africans are finding it harder to find time to prepare meals at home. Unsurprisingly the fast-food restaurant option is booming.In the feisty world of franchising nothing beats a good old fashioned fast food outlet. It’s not happenchance that in the world top ten franchises, seven are fast food brands, and within this broad sector sandwich franchises are growing into a franchise genre all of their own.
Endeavour Magazine | 47
While turkey meat is available in South African delicatessens and
the cold cut sections of major stores, very few brands in the Quick
Service Restaurant sector offer turkey. “Turkey meat is nowhere close
to being as popular as it is in Britain and the USA. We replaced that
with sliced chicken as this market is a chicken eating market, with
60% of our menu is made up of chicken products. ”
A Subway menu highlights a selection of sandwiches low in fat and
low in calories and the brand has a reputation for offering customers
a better alternative to traditional greasy and fatty fast food. “We are
not by any means indicating we are a health shop, but we do give
healthier options, and ‘Eat Fresh’ is very much a focus for us.”
What makes a Subway sandwich a unique experience? “It’s made
freshly before your eyes, just the way you like it; the sandwich making
process in very user friendly, and the customer becomes part of the
experience.
“We have 17 standard sandwiches as well as options specific to a
country or particular market. In South Africa for instance its chicken
mayonnaise, in Tanzania an offering based around vegetarian cheese
in tikka spice called pannier tikka .In Zambia the Subdog is the country
favorit. As a customer you make the decisions on a sandwich all the
way down the line. You might
pick cheese from the menu
and then decide on the kind of
cheese, which bread from five
different types – in our stores
we bake every four hours - types
of vegetables and all the way
down to the sauces and extras
that go with it. And of course
we have vegetarian options and
variations.
“At many places elsewhere
the sandwiches are pre-made
and I have to have what is offered
to me. But as a Subway consumer
I’m very much in control of what
I am having in my sandwich. Walk
by a Subway store and you can
smell the fresh bread and the
fresh cookies – very enticing!”
The perception that sandwich
franchises are healthier than
burger franchises is one reason
for the rapid expansion of
Subway. Lower start-up costs,
minimal equipment and space
requirements and the no cooking
factor are other appealing
reasons for the prospective
franchisee.
Recruiting the right
franchisee, one that fits the ethos
of the brand is obviously key,
says Martins. So too is a sound
business aptitude and a sound
business plan. “It’s all about team
work, being an entrepreneur.
Like any franchise Subway has
systems and controls in place
and unless someone fits the
SUBWAY SA
system and becomes part of the team, there’s no point in putting them
on board.
“Motivation is central to success, and initially you need to be
hands-on. It’s not that simple to make a good return on you’re business
when you are not involved.”
The quality of training is crucial, and for South African franchisees
this is undergone in a number of training centres across the world,
South African’s franchiseesw generally go to either Dubai or India.
Staff training includes Subway’s own on-line university as well as
hands-on instruction. “The way you get to make the perfect sandwich
is through practice.”
Securing the right site selection is another imperative aspect of
a successful Subway store, Subway undertakes extensive research
into issues such as viability, visibility, accessibility and demographics.
Identifying the major traffic patterns, the availability of parking, the
cost of utilities, the rent per square foot are other factors to consider
when locating a site.
It takes eight to ten weeks from the signing of the franchise
agreement to the opening of a store, and then a further three months
– during which teething issues are identified and resolved – before
the official Grand Opening. Franchisee investment input is between
R850, 000 to R1.1 million, depending on store size, with those in
shopping malls and food courts among the smaller. Stores vary in size
between 35-60 Square meters. “The main challenge is making sure
we have the right people on board.”
Subway’s suppliers are selected by price and reputation, and
with a strong and growing focus on local producers. Contracts are
reviewed every six months and in line with its growth plans. “We’ve
got a really good group of suppliers on board, who understand our
growth strategy, where we are going, and who want to grow with us.”
In Tanzania and Zambia - where KFC, Debonairs Pizza, and Steers
are established – the growth is impressive and accelerating, and
Martins is encouraged by the potential in Kenya. “We are doing very
well, absorbed into the market and consumers seem to seriously love
Subway.
“The big thing about Subway is that we are world-wide and
Number One QSR in terms of volume. There are always challenges
when you go into an emerging market, but all have been faced across
the globe and we have reference to the experiences of a very large
network. We don’t have to re-invent the wheel.
“From the consumer’s point of view, having a Subway sandwich
as a meal is healthy, and fun to make and eat. From the perspective of
the franchisee there are exciting opportunities here in South Africa
and elsewhere in Africa where we are positioned. We see our brand
growing in leaps and bounds in the next couple of years - so keep your
eyes open and see what’s happening in Subway Africa!”
“At many places elsewhere the sandwiches are pre-made and I have to have what is offered to me. But as a Subway consumer I’m very much in control of what I am having in my sandwich. Walk by a Subway store and you can smell the fresh bread and the fresh cookies – very enticing!”
SUBWAY SA
0027 11 326 1515
WWW.SUBWAY.COM
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