Looking to grow both from their existing franchisees
and new ones, and aiming to have 125 Subway locations
in India by the end of 2007, the submarine chain
is on a fast-track expansion mode, throwing up immense
opportunities for the prospective franchisees.
increased penchant among more and more Indians to
eat out has provided a shot in the arm for the quick-service
restaurant (QSR) segment. It comes as no surprise
then that many players, both domestic as well as
international, want to grab a slice of the rapidly
growing QSR pie.
Taking a cue, Subway, the American fast food giant
and leader in the QSR industry, has already set
up a wholly-owned subsidiary, Subway Systems India
Pvt. Ltd. in the country. With more than 26,000
locations in 85 countries, the Subway submarine
sandwich network is the world’s largest franchise
system in this category.
first set foot in India with an outlet in Saket,
New Delhi, in December 2001. From there on it spread
wings to both big and small cities like Mumbai,
Pune, Bangalore, Chennai, Hyderabad, Ranchi, Baroda,
etc. Better known as a multinational restaurant
franchise that mainly sells sandwiches and salads,
the brand Subway has carved out a niche for itself
in the Indian QSR sector, doing things uniquely.
They use the slogan ‘Eat Fresh’ to explain
how every sandwich is freshly baked using fresh
ingredients, in front of the customer, to their
exact specification by a ‘sandwich artist’.
Their ‘under 6’ menu – SUB sandwiches
with six grams of fat or less – is popular
with customers all around the world.
As far as the menu is concerned, Subway has taken
a cue from the experiences of the current fast-food
players offering Indian fare to survive in India,
and will be offering a much-Indianised menu, to
start with. It’s a specialized Indian menu
to cater to the market here, which includes Paneer
Tikka, Aloo Patty and Veg Shammi sandwiches, among
others in the vegetarian menu. In their non-vegetarian
section are Chicken Tikka, Chicken Seekh, Kali Mirch
Sandwiches etc. Their six-inch and foot-long versions
of Subs, myriad fillings and sauces defy description.
Customers at Subway are also granted the opportunity
to create their own sandwiches and can customize
them to their exact taste and requirement. At Subway
restaurants worldwide, the core menu stays relatively
the same, with the exception of some variations.
Adaptations are to be seen outside the menu as well.
The Subway stores in India have a separate vegetarian
and non-vegetarian counter preparation area, a feature
unique to India only.
Interestingly, more than 70% of new franchise systems
are sold to existing owners worldwide. Subway co-founder
Fred De Luca accredits his company's success to
its franchisees. "This franchisee energy is
really amazing in what it brings to the organization,"
In addition to its strong positioning as a more
health-conscious restaurant, much of Subway's rapid
growth can be attributed to its somewhat unique
business model. Unlike most franchisors, the parent
company does not operate any restaurants. Local
franchisees operate the stores, and in most markets
Subway enters into a contract with a franchisee
to be its ‘development agent’ for that
market. The development agent is then responsible
for developing new locations, evaluating stores
on a monthly basis, and assisting franchisees with
whatever needs they may have. Subway’s local
Indian company, ‘Subway Systems India Private
Limited’, has two area development managers
who work in collaboration with the development agents
and assist them on a national basis.
With plans to grow in areas where already established
and setting shop in several smaller cities, Subway
is surging ahead in its expansion plans for India.
Looking to set up in non-traditional locations,
they recently opened a store in a petrol pump in
the Bandra-Kurla complex in Mumbai, and an eatery
each at the airport and at a hospital in Delhi.
success of a franchise business depends on the strength
of the brand and its support system and the benefit
of marketing, advertising and operational support.
Before starting the venture, Subway provides its
franchisees with factory equipment, helps with the
site selection and the restaurant design. It provides
the franchisee with floor plans for specific location,
and an intensive two-week training. After getting
started the franchisee is provided with an operations
manual and video, field support and continuing education
through periodic newsletters, e-mails, DVDs and
training classes. In addition to this, a franchisee
coordinator who is also the main contact person,
and field support by a representative who helps
kickstart the business and provides ongoing operational
evaluations, are also at the franchisee’s
With Subway buttressing their franchising system
with all the support that it provides to its franchisees,
it’s little surprise that this prolific chain
is 26524 restaurants strong (as on August 20, 2006),
and still setting higher benchmarks in the world
of franchising. Surely, making a sandwich is the
easy part, the hard part is being named the number-one
franchise in Entrepreneur's Franchise 500 for the
fourteenth time. Did we say making sandwiches was
easy? It sounds more like making history.