Private Industry Type: fast food Founded In: Bridgeport, Connecticut, U. S. (1965) Founders:Fred De Luca and Peter Buck Headquarters:Milford, Connecticut, USA Key people:Fred De Luca(President) Mille Shin(EVP) David Worroll(Controller) Products:Subs Burgers Salads Pizzas and other food items. Revenue:^ $ 9. 0305 Billion USD P. A Owners:Doctor’s Associate Inc. Website:subway. com Subway is an American food restaurant which sells Sandwiches, Burgers, Salads and other drinking items. It is owned and operated by Doctor’s Associate Inc of USA.
Subway is one of the fastest growing restaurants in the world with approximately 33,566 franchises in 92 countries as of October, 1st 2010. It is the largest single-brand restaurant and franchise chain globally and the second largest restaurant operator globally after Yum! Brands (35,000 locations).
Subway has the largest number of franchises in USA than anyother QSR Resturant . Subway’s main Headquarters are located in Milford, Connecticut, USA and five regional centers support Subway’s growing international operations. The regional offices for European franchises are located in Amsterdam, Netherlands.
Australia and New Zealand. Whereas support Office are located in Brisbane and Australia. The Middle Eastern locations are supported from offices located in Beirut, Lebanon. The Asia Pacific locations from Singapore; India and Pakistan and the Latin America support center is in Miami, Florida. In United Kingdom the company hopes to expand to 2000 restaurants by some time in 2010. History [pic] [pic] In 1965, Fred De Luca borrowed $1,000 from his family friends; Haydee Pinero and Peter Buck to start his first sandwich shop. At this time he was only 17 years old.
Secondary data investigates past research undertaken in customer satisfaction surveys and the market position of Subway in relation to its major competitors. The purpose of the study is also revealed here with the objectives and the usefulness that the findings will serve. The analysis then details the methods used to carry out the research process. The use of selfadministered surveys and the ...
He was raising money to pay for his college dues. Dr. Peter Buck suggested to Fred that he should open a sandwich shop in order to make enough money to pay for college tution. After raising the money, he deeply examined the different locations in Connecticut for his new resturant. At last he decided to set up his resturant in a mediocre location of Connecticut, which was the corner of East Main Street, Boston Avenue in Bridgeport, Connecticut. By the noon on the opening day, he saw a number of customers were pouring in. He was surprised to see a tremendous response from the customers.
On the radio advertisement they had promoted the name of his resturant as Pete’s Submarines, which sounded like “Pizza Marines”, so they changed the name to “Pete’s Subs”; eventually they adopted the “Subway” name and they decorated the store with maps of the New York City subway system; a theme that continues to this day. As of December 30, 2008, the company has 32,401 franchised locations in 91 countries and produced US$9. 05 billion in sales every year. In 2007, Forbes magazine named Fred De Luca # 242 of the 400 richest Americans with a net worth of $1. 5 billion.
In addition to the locations of traditional restaurants, Subway operates in many non-traditional locations. For instance, there are over 900 Subway locations inside of Wal-Mart stores and 200 on military bases, including several in Iraq and Afghanistan, there are three branches located inside The Pentagon, as well as an increasing number on college and university campuses. In United Kingdom, the company has introduced a new concept of mobile resturants which are responsible for providing the products to the customers at convenient locations. Today it is holding more than US 9. 05 billion dollar sales worldwide.
Subway restaurants have been consistently ranked in Entrepreneur Magazine’s Top 500 Franchises and was selected as the #2 overall franchises in 2008. Additionally, it was ranked as the #3 “Fastest Growing Franchise”, and the #1 “Global Franchise” as well. Mission & Vision [pic][pic] Mission: “To Become a Healthy Fast Food Chain Offering a Variety of Sandwiches and Subs” “To provide the tools and knowledge to allow entrepreneurs to successfully compete in the QSR industry worldwide by consistently offering value to consumers through providing great-tasting food that is good for them and made the way they like it” Vision: To Expand internationally with the help of Franchising option” What need our offering is designed to fill? [pic] A:To meet the food needs of human beings “Market Offerings” “Some combinations of products, services, information or experiences offered to a market to satisfy a need or want” [pic] [pic] Subway’s main product is the submarine sandwich, or “Sub”. Many stores also offer Cookies, muffins, and Danishes which may be produced in a variety of flavors. The main products which the subway provided at the beginning were the hot sandwiches, cold sandwiches, Subs and cookies.
Subway targets consumers ranging from 18 – 45 Years old, where business workers are their main consumers. Subway has been targeting mostly foreigners when it was started in 2003. Where they targeted for 80% foreigners and 20% local consumers. This is because when it was first start, only foreigners know about the brand Subway. Subway aims to turn this around where they would like to target ...
They also offer a variety of cookies and muffins with different flavors. The main course of the subway was the submarine sandwiches; year by year subway added the special items to its menu with the beverages like coco-cola and Pepsi. In 2001, Subway added seasoned breads and a line of specialty items to its menu and in 2003, most Subway markets switched their beverage contracts to supply Coca-Cola products exclusively having previously left it up to the individual market to decide whether to serve Coke or Pepsi.
In order to ink the current deal with Coca-Cola, Coca-Cola helped pay for the initial amount of toaster ovens to all existing restaurants in North America. Subway gave customers the option to have their sandwiches toasted in response to increased competition from a rival sandwich chain, Quiznos, which popularized toasted submarine sandwiches. The TurboChef and Merrychef toaster ovens are a microwave oven prototype; these are currently not available for retail. In retaliation to deal with Coca-Cola.
Quiznos switched its contract with Pepsi cola international, except in Canada where he still sell the products of Coca-Cola. Subway in Mexico still serves Pepsi products. Subway menus vary by store, by country and by market. These are considered COP (country optional program), SOP (store optional program), MOP (market only program) but retain core items which are included at every store. The main food sold by the store is Submarine sandwiches, sold in “Six-inch” (15 cm), “Footlong” (30 cm), and the four inch (10 cm) “Mini Sub” sizes.
A discussion of the strengths, weaknesses, opportunities and threats facing Subway, with its marketing strategies being examined as one of the chain's primary strengths.IntroductionWhat started as a single store in Connecticut in 1965 has grown into a multi-billion dollar organization with more than 17,000 locations in 72 countries around the world. Born out of a business partnership between 18- ...
All Subway stores offer customers lettuce, tomato, onions, bell peppers, cucumbers, olives, jalapenos and pickles, as well as market selected options such as carrot, corn, radish and avocado. Once there was a time where the BMT sandwiches was popular upon all the sandwiches, BMT stands for the Brooklyn Manhattan Transit, but later it was pronounced as Biggest Meatiest Tastiest sandwiches. It contains the combination of ham, salami and pepperoni. This variety was popularly consumed as the cold sandwich in the United Kingdom.
Mainly adults from the age 18 to 34 were targeted; the food items considered was healthy and supervised under hygienic condition and according to the people’s specifications like their likes and dislikes in the product menu. Subway is now making around 2 million different sandwiches available for different customers around the globe. The main competitors for the subway are the KFC, Mc Donald’s, Pizza Hut, Burger King, and many other sandwich shops. Like other fast-food restaurants, they offer “limited time offers” or LTO from time to time.
In addition to their standard menu, Subway also offers catering for all types of occasions. They offer “Giant Subs”, which are a minimum of three feet long. All Subway restaurants in Muslim countries serve a halal menu. There are also at least two Subway restaurants in the United States that do the same, three in Canada, and over one hundred in the United Kingdom. The success of these stores has been mixed, with many locations reporting reduced sales as a result, but the company is commited to open more halal stores.
Subway also offers items other than sandwiches; breakfast items include such baked goods as bagels, egg & sausage sandwiches, and as of July and August 2006, “personal pizzas” are available in selected markets. The personal pizzas are made upon order (as with their sandwiches) and heated “in less than 90 seconds” (cooking for 85 seconds) as advertised on televised commercials. Breakfast and pizza items are only available in some stores. Most stores offer additional toppings upon request. In November 2009, Seattle’s Best Coffee announced that they’d signed an agreement to serve freshly brewed coffee as part of Subway’s breakfast offerings.
The Essay on Why Is a Product/Customer Focus an Important Characteristic for Successful Entrepreneurs
A product/customer focus is a pivotal characteristic that entrepreneurs must have in order for the entrepreneur themselves and their business to be successful. With that said, an entrepreneur with a product/customer focus is one that clearly understands the needs and wants of their customers and thereby producing and developing products that enhance people’s lives, but also products that meet and ...
Value [pic] “The sum of percived tangible and intangible benefits and costs to consumers” As we know that the basic purpose of marketing is to create a value for customers and to build strong relationships in order to capture value from customers in return. The Subway creative team and market researcher are struggling hard for value defining, Value developing and Value delivering that is more appealing and need satisfying than its competitors. Following points clearly define the values which are being offered by the subway restaurant. The food is the basic need of every human being but Wants strongly influence the needs of human beings of a particular society. • As Subway is the basically American food restaurant and Time is an important factor of American culture. An American’s life is very busy, American public want such type of food which is available instantly, be delicious and quickly digestive. • In other words we can say that an American restaurant should be able to deliver food to the customers in the little passage of time. • To fulfill the requirements of an American.
Subway is offering quality fast food items in its menu like subs, burgers etc. • Quick service is another characteristic of the Subway restaurant. After the products are produced in the little passage of time there should be suitable arrangements to make it available to consumers. • For this purpose Subway has employed a young and energetic workforce in its restaurants. It has enforced the golden principles of division of labor and synergy in its restaurant environment. It has established quick counters, drive through windows, POS (Point of Sale Terminals) and a Home delivery network supported by GPS.
Everyone is ignorant, only on different subjects. To learn is to acquire knowledge or skill. Learning also may involve a change in attitude. Learning is not just a change in attitude; it is a change in the way a man thinks, understands, or feels. Learning some things depends on other perceptions which have preceded these learning’s, and on the availability of time to sense and relate these new ...
Satisfaction [pic] “The Consumers personal judgment of product perceived performance in relationship to the expectation” If product falls short of consumer expectation, the consumer is dissatisfied. If product meets the expectation of consumer, the consumer is satisfied. If product surpasses the expectation of consumer, the consumer is delighted. Subway wants its customers to be delighted. To come up with these expectations, it has designed a variety of products according to the Cultural and Societal values.
If we talk about the Subway in Pakistan we are sure that it is offering the Halal food. Subway management is well aware with this fact that if its wants to become a No. 1 fast food restaurant of world. It must follow the rules of the every society in which it operates. Subway strive for success can be easily measured with this fact that the restaurant has offered a wide variety of product substitute in India like vegetable sandwiches, chicken Sandwiches because Cow is considered as a Sacred Animal in their culture and they always show retaliation to every activity relating to its sacrifice.
Subway is always making his every possible effort to surpass the expectation to of its consumers and to satisfy them better than competitors do. STP (Segmentation, Targeting, Positioning) [pic] Segmentation: “Dividing the market into distinct group of buyers who have distinct needs, characteristics or behavior and who might require separate products and marketing program” There are different attributes and factors which the influence of segmentation for the products and services which the subway offers to its market. Here many variables influence the market segmentation for the Subway products.
Coming to the segmentation strategy it is essential to know what the customer is considering from the products provided by the subway. The segmentation strategies can be described more effectively in many different variables which results in the marketing segmentation, there are different forms of segmentations available like the demographic, behavioral and psychographic segmentation. The psychographic segmentation is something depending on the interest, activities, attitudes and hobbies of the customers towards the products and the dignity of loyalty maintained.
Fast Food The fast food industry is one of the largest industries in the world. Fast food has been known to be a large area of investment involving food. Restaurants such as McDonalds and Burger King have been known for their popularity mostly from advertisements and are highly rated to be the trademarks for the fast food industry. Although part of the industrys functions is to sell their products ...
What the people look around is the cheaper cost food item which suits the pockets of the many college going adults as the concept is something related to the value for money. This segmentation strategy is considered under a light, medium and heavy group and is based on different types of social classes. The behavioral segmentation is based on the various responses generated through the utilization of the product. This segmentation is purely related to attitudes. It also relate to what a customer is getting benefited from, there are different variables which do occurs at different situations like he demand for the turkeys are more at the time of Christmas timing and different items at different situations. The approach is basically described in two ways one is the benefit part and the other is usage. The demographic segmentation is something related to the age group, gender, life cycle and income and according to subway it majorly acts on the principle of concentrating on the age group in between 18 to 39 years mostly the people which are either studying or working. We can observe the change in the products which are consumed by different age groups.
So it is a strategy that involves the promotion of the item which meets the requirements of different age groups. The segmentation of gender comes under dressing, clothing and other facts. The other popular way for attraction is the discount offers made on the products which directly appeals the customers of low incomes. The geographic segmentation is related to various strategical segments like the country, locations, towns and cities. This strategical segmentation is totally based on the regions where the choice of holding a different variety of customers are noticed and are sub categorized for the easy access.
The segmentation divides the markets into various groups of geographic areas with people having different characters and behaviors. If we take the preference of what the other region customers prefer like the Asian, European, and United States of America the subway worldwide sell the burgers which are aimed at the private markets, for example if we choose that the burgers are made from the lamb from the Asian continent and if we take India as a place where beef is not preferred due to the religious matter it is the importance given to the preference.
In the American continent there is an extensive usage of the chilly sauce, so different regions have different taste and acceptability of the products. Benefit segmentation is something which is difficult for satisfying the customers need. It is the best way to satisfy customized products for example if we take the two different individuals buying the same product with different reasons of purchasing them Many of the segmentations analysis are purely based on the different type of cluster analysis.
There are better ways to identify which segmentation is more important, and are different techniques involved in the cluster. There are different segment codes applied to segments. The use of segmentation is useful while having limited resource availability for deploying. This kind of segmentation makes the firms to use fewer resources satisfying a variety of customers with the products availability ranging in different advertising activity. Through the segmentation least profitable customer is identified through focusing on the products and the services.
Also improvement in the loyal relationships makes the services improvement through the products. Whole usage of the resources and meeting the customer’s needs accordingly. There is a chance of getting benefited through lowering the cost of the products and their services offered. Grouping the people in a set of factors which includes the size, organization, the kind of lifestyle that the people are having and their behavior and kind of attitude all this comes under the geographic location. Market Segments: “A group of consumers who respond in a similar way to a given set of marketing effort”
When Subway was incepted, its main segment was the Middle Class of the society. The average and blue collar workers who want fast food items for lunch or dinner purpose at substantially lower prices. Subway USA is still following this philosophy and providing its products at competitive prices. But as Subway extended its operation in the other countries of the world, it has become a hot spot for the Upper Upper Class and the Lower Upper Class of the Society of that particular region which is 8% to 10 % of the society. In Pakistan, Subway main Segment is to cater the needs of this particular class.
If Subway wants to capture a huge share in the Pakistani Market, then it should have to address the concerns of the Middle Class in Pakistan. Market Targeting: [pic] “The process of evaluating each market segment’s attractiveness and selecting one or more segments to enter” Subway identified its target market as “Demanding People Who Know Their Own Minds”. The people who like to have nutrition food, quickly served and quickly digestive. For example, Subway defines its target audience for sub of the day who are in between the age of eighteen to thirty-nine agreed any five statements mentioned: The youngsters who believe that they won’t be influenced by any other views. • Those audiences who wants to be received by other people as they are. • The youngsters who likes to follow for a life with novelty, challenge and change, who would like to try with different varieties of food products, the target audience to keep learning with items for whole life, • The youngsters who do not bother for their future and wants to cheer up the present life and target audience who wants to be well informed, be organized in life. The youngsters who all with the above or some of the above qualities and who expects the alternative food culture rather than the trash culture, sub of the day is the best alternative to those who don’t want to be compromise for their individuality and values. Subway offers varied food chains, which is a specification of target audience healthy food list Subway at the same time taking care of consumer’s preference when offering regular sub sandwiches, salads, wraps, snacks, desserts with low fat options, with these more than two million varieties of sandwich options.
Further to attract these target audience subway for its sub of the day is priced 179/-, attracted the adults to treat them self, subway research towards the eating habits of the target audience that their food habits are irregular they are spoiled for the variety of food choices, these customers are intended to choose what they wanted and how structured they want it, they have high expectations with low loyalty. Subway sandwiches offered to its customers as per their specifications, in front of the customer according to his choice.
Subway is offering its customers the choice of “point to order”, so that new customers won’t confuse for their selection. It is the exact opposite way of delivering the service by its competitors like KFC, Mc Donald and Burger King Etc. As we can see that in Pakistan and Middle East, there is comparatively low difference between a Subway Restaurant and a Five Star Hotel. The main reason is that Subway International is charging prices of their products according to the US Dollars in the every region of the world. Due Currency exchange differences, that price rises in other countries.
For example, Subway is charging 5 $ in USA for its 30cm Sub which is a good price according to that country but if we talk about Pakistan the price goes to more than 350/- Rupees which is an unaffordable price for the middle class in Pakistan. If Subway wants to capture good market share in Pakistan then it would have to target the concerns of middle class and working class of the Pakistani society. Positioning: “Arranging for a product to occupy a clear, distinctive and desirable place relative to competing products in the mind of target consumers”
Providing a healthy fast food chain for a healthier and hygienic food is a brand value strategy. Subways are well advantaged and positioned throughout the strengths and weaknesses and also the threats that cause the effects to its strategy. We can discuss about the strengths, weaknesses, threats and different opportunities available. Coming to strengths the main strength of subway is its size and number of stores and its channels located across the globe. The listing of the healthy items includes the fresh and fast food items that reflect the menu, use of distribution channels for the growth of its shops.
Maintaining a good relation with the American heart association and getting worldwide recognitions due to its healthy supply of food and offering to all ages. User friendly menu listings and preferences serving, low cost setup for the franchisee, and an instant startup of the franchisee under a specified training. The weaknesses that are derived from the strengths are that some of the franchisee is not happy with response they are getting from the main office. There is a deviation in the services provided from store to store. The revenue generation is less and the payment given to the employee is increasing spontaneously.
The opportunities obtained through these are in rapid growth of the global business. Improving the customer related services and also expanding the distribution channels to other private agencies, offering a variety of packed desserts, and the business franchisee relations. Daily updating the menu through revised offerings. Expanding the services through the partnerships, movie co-production and toy manufacturers for advertisements. Getting advertised through the films and other media increases the promotion of the films and also increases the brand value branding opportunities.
There are also threats attached that are enforcing the legal rights by the franchisee. Contamination of the food items, if no proper care is taken the contaminations could be degradation of vegetable items, etc. the competition against the rivals in maintaining the standards and price quotes. There could be a national economic crisis, upon the demand on consumers, product consumptions and launching of new menu items. As I have already mentioned that Subway restaurant is basically specialized in making of different varieties of Sandwiches.
Subway main advertising slogan is “Eat Fresh” explains that how every sandwich is made on freshly baked bread, using fresh ingredients, in front of the customer to their exact specification by their employees whom Subway called “Subway Sandwich Artists”. In this way Subway distinguish itself and its products relative to competitors products in the mind of consumer. Brand Differentition:- [pic][pic] There is makeover in a new positioning of the subway for its marketing place, mainly in distinguishing from the competitor’s value. The differentiation makes the subway to look at its customers’ needs.
Building a superior value of position makes the identification more competitive. The differentiation comes for the product like providing no oily food, fresh tomatoes, mayo’s and other items. Providing a healthy fast food at lunch and dinner timing reduces the effect of increasing the weight. This made the people to sign more franchises and the people’s attraction towards the health increased eventually. Positioning depends on some of the functional like rectifying the problem, making the customers to get profit and also by the symbolic function where the enhancement of the self image, identifying their social fulfillment. Subway differentiates itself in term of healthy sandwiches as an alternative to fast food” Subway launched its new brand “sub of the day” in which there is different price 179/-. This offers the cheapest meal of the day to attract the people. This launching of the new brand made the other competitors to launch their own different brands with lower price options. Once if there is market segmentation which is identified through the identification of the segmentation getting positioned, it is the product which is perceived by the customers. Opportunities and competition are identified accordingly.
The release of the product is totally depending upon the brand name, as there was an increase in the product positioning of the “sub of the day”. There is also increase in the brand billing, later subway came in the limelight and is having Burger king and Mc Donald as its major competitors. Value Proposition [pic] “ The set of benefits that they offer to their consumers to satisfy there need” Most of the marketing offerings of a food resturant are the variable mix of goods and services. Which means that in addition to the products, a resturant also provides best services to create a unique and favourable image in the mind of customers.
For this purpose Subway in Pakistan is providing best products alongwith best services. It has implemented the concepts of divison of labour and synergy in its working environement. Under the division of labour concept, every person has assigned a specialized task and he is responsible for effectively performance of that task. Whereas this concept has become synergy implication for subway ( 1+1>2).
Marketing Mix “The set of controllable tactical marketing tools- product, price, place and promotion that the firm blends to produce the response it wants in the target market” Product:- Product is defined as Anything which is offered in the market for attention, use and detail that might satisfy some need or want” Subway in Pakistan is offering the following variety of products [pic] [pic] The most unique product which Subway is offering in pakistan is the “Sub of the day” in which you can get a regular Sub which is costing 269-519/- Rupees in regular days at just 179/- Rupees. The menu of Sub of the day has been new everyday to cater the wants of customer. The main philosophy behined launching the new product was to increase the flow of the customers to the subway restaurant and it includes the cheapest item in the menu every day.
This brand main motto was to attract more people to its subway with a lower cost item. .There is menu of Sub of the day changes from Monday to Sunday. However, in Sunday you have a choice to get any of the Sub of the later weekday. This technique of renaming and re-launching the new products increase the customers flow to the subs. Quality Control:- [pic] All Subway products are made under strict Quality Control meeting international stnadards. In Pakistan, PSQCA(Pakistan Standard and Quality Control Assurance) organization has made compulsry for every organization to make its product according to PSQCA predefined rules and standards.
This can be any product ranging from engineering to eatables. In addition to the above, special gloves are provided to the Sandwich Artists which are required to be worn during the all food handling procedures. All franchises are provided with detailed information on proper food handling procedures in order to properly train their crew members. Topics that are covered include proper hand washing and glove use procedures and food rotation. Special veggies are prepared daily and temprature of special food items are monitered after every hour.
A special program named as “ServSafe food safety program “ is offered to franchisees and other field staff around the world. This program is conduted at the SUBWAY Headquarters, USA. Subway chain has also initiated a number of “Gold Standards” policies regarding prepared food and produce manufacturing and inspection specification. Desiging process of products:- Five steps are involved in the prepration of Sub. • In 1st step, customer have to go to the counter and place an order on the counter. In this step, cutomer will have to select Bread for its Sub or Sandwich. There are two types of breads.
One is White and other is Brown. White Bread is sweetned bread and is normally used in the prepration process whereas, Brwon Bread is special bread made for the Diabetic Patients. There is no sweet material in this type of bread. • In the 2nd step, cutomer will have to select meat for its product. Customer can add chicken and beef in its product. • In the 3rd step, customer will normally select veggies to add in its product. Customer can add varitey of veggies right from the selction range of 18 itmes. • In the 4th step, Sauses are selected by the customers which are to be added in its product. In the 5th step, customer will have to select drink from the Wide variety of coke products. Customer can select a 500ML plastic bottle or can select soft drink with free refill option in which you can get your glass refilled for the number of times. • In the 6th step, cutomer will have to make a required payment on the counter. • By keeping in view the above steps, we can say that there is 100% customer involvement in the Prepration process of Sub at the resturant. Subway gives free authority to every customer to customize its Sub and Sandwiches. You can add or remove any item in your Sub.
These items are ranging from Cheese to olive oil. While making your Sub the Sandwiches artist make a loud voice and ask from customer that whether he would like to add or remove the particulur item in his Sub or not. You can put the delicious items in your Sub and make it very tasty. Through this customization option, Subway has a strong edge on its competitors that they can make their own Sub before their eyes and with the help and guidance of Sandwich experts. Brandname of the Products:- [pic] When Subway was incorporated, its main product was the Sub(Submarine Sandwich).
But with the passage of time Doctor’s Associate put variety of unique products in its menu. These menus vary form country to country and region to region. Famous Brands of Subway in Pakistan is as follows. • Classics (Italian BMT – Spicy Italian) • Hot Toasted Subs (Steak & Cheese – Smoked Beef) • Basics (Veggie Delight – Subway Club) • Pizzas and Burgers (On Selected outlets) • Chicken Favorites (Chicken Fajita – Chicken Tikka) • Salads (Turkey Breasts – Bar B. Q Chicken) • Deli style Sandwiches (Chicken Fajita – Chicken Teriyaki) • Kid’s Pack (6 inch sandwich, Drink, Crisps & Toy) Drinks (NR – Cappuccino) • Subway Crisps • Cookies (Chocolate – Macadamia Nuts) In Classics, Hot Toasted Subs, Basics and Chicken Favourities you can get your Sub from 6 inch to Footlong(12 Inch) which is double in size and double in price. Whereas, in Salads you can get a Salad Bowl measuring 6 inch. Subway gives you option to get your meal upsize by just paying 80/- Rupees more. Packaging:- [pic] You have ready option to get your Suway meal through Dine-In, Takeaway and under Free Home delivery System. All Subway products like Sub and Classics are packed in the paper which is free from any chemical material.
It means that, the wrapping paper is not injurious to health. In Home Delivery System, Subway has introduced an oven hot technology. This technology make it possible to deliver fresh and hot Subs at the door step of the customer. Altough this concept has been introduced by the Pizza Hut (Pakistan) several years ago. But yet it is a big edge for the customers of Subway. Services:- As we have alredy described that Subway International has enforced concept of “Divison of Labour” in its resturants. Through this concept every worker is engaged in the seprate task in the resturant.
The Sandwich experts are responsible for quick desiging and baking the sandwich, the cashier is responsible for making bill and collecting cash, the sweeper is repsonsble for cleaning task of resturant and delivery boy is respponsible for the fast delivery of Subs at the door step of customer. So we can Subway is dealing and fulfilling the customers in the shortest possible time and creating a unique and strong image in the mind of cutomer. Price Prices of the Products:- [pic] There are two ranges of price in the Classic, Hot toasted Subs, Basic and in Chicken Favourites portion of the Subway menu.
These are 6 inch and foot long, There is difference in sizes of Subs. There is 100% to 150 % price increment in moving from 6 inch potion to foot long portion. One of most thing which we have observed in the menu of subway is the full disclosure of prices inclusive of all taxes. It means that all prices which are shown in the menu are the real prices of the products. Whereas if we talk about other fast food chain like Pizza Hut (Pakistan), this practice is not available. The price list of all the Products of Pizza Hut (Pakistan) is not real.
A small pizza is shown as just 180/- Rupees but if we make actual order the price raised to 230/- Rupees which is not fair in the interest of Customers as well as society. Under performance marketing concept, a company should address the concerns of its cutomers and make all possible disclosure to create a favourable image. Discounts:- [pic] Special discounts are granted to to Sub Club members and for party events. These discounts for special events varies from the number of guests. For discounts availabitlity the customer should contact the manager of the resturant.
Promotion [pic][pic] Promtion Mix:- “The Specific Blend of advertising, Sales Promotion, Public Realtions, Personal Selling and direct marketing tools that the company uses to persuasively communicate customer value and build customer relationship” Subway Pakistan uses follwing promtion mix tools Advertising:- [pic] [pic] Subway uses the advertising slogan “Eat Fresh Everyday” to explain how every sandwich is made on freshly baked bread, using fresh ingredients, in front of the customer to their exact specification, by employees whom Subway terms “Subway Sandwich Artists”.
Subway Pakistan uses different types of advertising media to tell the merits of its products to customers. • In Television media, Subway has developed commercials to attract the new customers for its products as well as to retain old customers by providing attractive deals. • Trasport Media (Mobile Marketing) • Fliers. (Broucher) • The Newspaper Media. • Billboards. • Magazines. • Radio • Internet (through its website and Facebook) Personal Selling:- [pic] Personal selling is the presentation of the firm’s product by the firm’s sales force for making sales and building customer relationship.
As I have already described that Subway sales force and Subway sandwich artists provides variety of services for building long term customer relationship. The Sub customization system, communication of latest promotions and discounts, a smiling face, giving of surprise free gifts with every kid pack are the few examples of personal selling efforts, which are making by the Subway workforce. Subway workforce are made capable for extraordinary personal selling efforts through periodic capacity building workshops and training sessions which are designed to cater needs of this relationship network.
In 21st century no company can survive without building long term relationship with customer. Sales Promotion:- Short term incentives given to the customers to increase sales. When Subway started its operations in Multan, it gave buy one get one free offer under which it offered free Subs of other taste on the Purchase of one Sub. For example, the customer who have purchase Steak & cheese Sub of 6 foot long is eligible for the purchase of Beef Pastrami Sub of 6 foot long or anyother Sub of 6 foot long. By this method, Subway not only attarcted customers but also make them familiar with the Subs of other tastes.
In addition to this it also offered promotional products for the first 100 customers. In which it gave ball pens, Note books, key rings etc. These promotional products are still given by the Subway Multan on some special request to Resturant Manager or for Sub Club Members. There were also contest for the kids in which they conduct different drawing competitions for the childern under 12 years. The main purpose of all these activities was to provide strong footings to Subway in Multan and to build and maintain strong and eduring realationships with the customers.
Stakeholders Relations:- Under holistic marketing concept, it is necessary for every company to build strong relationships with customers and other stakeholders so that it can achieve its predetermined objectives. Subway Multan is making its every possible effort to build strong realtionships with its customers, whose purchases make it possible for Subway to achieve its objectives. The Behaviour of its Workforce, Quality of Services & Products and Promotional techniques make it clear to us Subway is actively pursuing its Mission.
In 21st Century, no company can survive by building just long term relationships with customers but it is also important that company management should pay attention for building relationships with Suppliers who are called partners in the modern sense and many companies around the world are activly focusing on PRM(Partnership Relationship Management).
Doctor’s Inc USA which is founding Company of Subway Resturant around the world is following the strategy of making prompt payments to suppliers as soon as the beef and other Raw Material arrives.
In addition to this they also make periodic evaluation of general price rise due to inflation in the world economies. Under this, they automatically increase the payment of raw material based on careful assesment of the World Economy. Through this method Suppliers are not only satisfy but they are also anxious for supplying their goods well before the deadline. Customers are the members of the society and it is necessary for every company to do some positive activity for the well being of the members of the society. Under this philosophy Doctor’s Inc USA donate 12% of the yearly earnings for the public welfare.
These donations are made to United Nations specialzed donor agencies such as Unicef, UNFPA, WFP etc. Sponsorship [pic][pic] Subway is the corporate sponsor for two NASCAR Sprint Cup series stock car races: the Subway Fresh Fit 600, held at Phoenix International Raceway USA and the Subway 500, held at Martinsville Speedway. In addition, Subway has been the primary sponsor of the NASCAR Sprint Cup number 99 car, driven by Carl Edwards. In 2007, Tony Stewart has appeared with Jared Fogel in ads, and he has driven his #20 Home Depot Toyota with Subway primary sponsorship in the 2008 Subway Fresh Fit 500, he now drives the #14 Office Depot Chevy.
Previously, Subway had sponsored Jeff Purvis’ #51 car in at least one race in 2001. They also sponsor a pro-cycling team, and had their name on the shirts of Gretna F. C. before the club went bust in 2008. In the 1996 film Happy Gilmore, Subway was also the sponsor of the titular character. In July 2009, the Edinburgh Meadows baseball team announced that Subway will be their official sponsor for the forthcoming baseball season. Subway has also been a sponsor of the 2009 Little League World Series, where they advertised their Subway Fresh Fit Meals. Placement [pic] Distribution Channels:-
If we talk about distribution channel, Subway Pakistan is using direct marketing channels. In which, it is selling products directly to the final customers without involvement of any party. So we can say that Subway Pakistan is using channel No. 1 of customer marketing channel. [pic] Subway uses direct marketing channels since it deals directly with its consumers. Although Subway’s product is a shopping good, it uses selective distribution. This is due to the fact that Subway only allows its products to be sold in corporate approved Subway locations as apposed to selling Subway products wherever possible as in intensive distribution
Franchsisng:- [pic] [pic] Since Subway is incorporated, its stratgey is to expand internationally through extensive franchising operations. Subway started its franchising operations in Middle East by its first franchise in Bahrain in 1984. At that time its international approach was “If you like Subway, you think it’s a good thing, and you think it would work in your country, then we’ll teach you the concept and how it works and you go make it work in your country”. Now there are more than 33500 outlets of Subway around the world.
These outlets ranges from Airport Bars to Complete Resturant Near High Court, Multan. In addition to this, Subway has also established special dessigned Points of Purchase for the American Soldiers deployed in afghanistan and iraq. The attractive features of Subway franchsing operations are as under • Low start up costs – Less equipment is needed • Countertop, oven, refrigerator, and microwave – Small Area is needed • Real-estate costs are low • Lowered operating costs which therefore raise margins – $12,000 vs $45,000 for McDonalds Makes it appealing to investors Subway main success feature in franchising operations are the strong brand based on a unique value proposition aimed at a dissatisfied target segment. The company’s low-cost franchising strategy has allowed Subway to flourish both domestically and overseas. Locations in Pakistan:- [pic] [pic] [pic] [pic] Subway in Pakistan is located in more than 28 locations. In Lahore, there are more than 11 franchises. Whereas in Karachi, there are 9 franchises. In Islamabad, 2 locations are operational.
In addition to this Subway has also established more than 2 locations near on the Main Highways and Motorways of Pakistan. Other franchises are in Jehlum, Gujranwala, Sialkot, Multan, etc There is 1 more one franchise which is coming soon in 20-A Gulgshat Colony, Multan. More outlets are coming soon in Karachi, Lahore, Motorway and Sialkot. Logistics:- [pic] Subway has got collaboration with FedEx (Federal Express) and DHL for its supply chain management and logistics support. Both of these companies are responsible for supplying beef and other ingredients to the Subway franchises and locations all over the world.
In Pakistan, K & N Chicken is fulfilling the demand of Chicken of Subway franchises all over the Pakistan. K & N Chicken has its own fleet which provides the chicken through the freezing containers all over the Pakistan. Whereas, DAWN Bread, Lahore supply the White and Brown Bread to all outlets in Pakistan. It gets support through the Logistics Services of PTN (Perfect Transport Network) SWOT ANALYSIS [pic] Now in this section, we will make SWOT analysis of Subway (Pakistan) Strengths:- • Subway made its presence over ninety one countries with 33,794 stores which shows its potential growth in the market. Subway is in the list of largest chain of QSR (Quick Service Restaurant) in the world. • It offers a wide range of sandwiches. According to subway there are more than two million subways sandwich combinations are available. • It gained customer repetition as it supplies a nutrition food, preparation of the sandwiches and Subs are just in front of the customer to choose his own selection of breads, sauces and toppings. • It supports the franchise development right from beginning for training, advertising, development of product, cooperates in purchasing and run time support. Subway offers submarine sandwiches and salads, daily fresh made breads; it even concentrates on religious beliefs, everywhere in the world the same menu items, with the same taste provided, which made its own brand recognition. • Subway shop fits with small area simple kitchens, offering a reasonably comfortable price for single and combo deals. Subway with its pricing strategy it reached customer expectations giving them low price fast food sandwiches satisfying their basic needs to eat what they wish. Weaknesses:- • The decoration of the sandwiches is not so classy and some of its franchises are not happy from its management. Service deliver process varies from one store to other store. • There is a high turnover behind the employees; there is no proper command on franchised shops. • There are many legal disputes with the franchisees which lead to experience a break in the contract and sometimes the sales figures are miss-leaded by the franchisees as the business practice is shady. • Some customers have a bad perception on ‘sub club card ‘ which is miss leading the customers to think that Subway sacrificed the quality of product and services for its low priced strategy, with this ‘sub of the day’ even encounter business lose. Inadequacy of Advertisement in Pakistan as compared to its competitors (KFC, Pizza Hut and Burger King) • Inadequacy of outlets in Pakistan • Lack of Parking Facility in Multan Franchise. • No Drive Through windows in Multan Franchise. • No Children Play area (A Potential segment) Opportunities:- • Subway consistent growth makes it as a hot global business. • The more stylish decoration of the sub will fetch as added advantage to its sales. • The customer service system needs to be reinforced to make Subway unique in the market. Giving of more opportunities to expand its franchises like helping and in terms of finance and motivation, at the same time need to concentrate for a better relationship with franchises, making them to try in new selling methods some desserts along with the menu, • The menu items needs to be revised frequently and update it with new offerings as I have see that there are considerable amount of Subway items which are missing in the Pakistani menu. • Develop good relationship with media partners for improved promotion and co branding prospects. Introduction of more attractive offers. • Introduction of Pizzas in Multan Branch • Allocations of space for the children play area. Threats:- • New litigations from franchisee holders, stores need to be maintained with a great concentration to rescue the food items like spinach, salad ingredients and breads. • As this industry in a huge competition Subway always need to update with the market standards. There are some other reasons like sabotage; economic downturn and law suits obligation are the major threats to the Subway sandwich restaurants. • Quizno’s operations in Pakistan Mc Donald introduction of “Deli Everyday” brand with the same objectives of “Sub of the Day” COMPETITORS • KFC[pic] • PIZZA HUT [pic] • QUIZNO’S [pic] • BURGER KING [pic][pic] RECOMMENDATIONS Subway and its unique products in QSR (quick Service Restaurant) industry the important factor to success is management. Therefore to get the estimated success rate bottom line employees to top level management even need to have regular trainings to manage any aspects of the store. Well trained employees will give confidence for doing the competitive edge in the industry. It needs to maintain the customer expectations to his previewed value.
Subway should have more clear market position to maintain its success and it should give clear message to its management, what position they want to maintain in this industry. As the industry itself in a mature stage, it is little tuff to maintain low cost strategy. Even though it concentrate on product differentiation also need to give same importance to marketing differentiation and it should maintain control on cost effectiveness. Subway for its successful progression it should maintain franchise operation effectively, as a part of its objectives it should promote to establish more franchises around the world.
It should monitor the franchises operations for a unique position. Further to maintain same growth, maintain the franchises holders happy, better take feed backs and advices from the franchises consistently. As ‘sub of the day’ hit the market for its pricing strategy and healthy fast food strategy it is advisable to keep continue and further more campaigning is needed. As in the case of the sub of the day product is segmented demographically even better to understand the local markets and the combination preferences and tailoring the menu items fetches more business, better offer new items according to the local tastes.
At present most of the places subway having a very less seating capacity, seating arrangements need to be considered to provide more seating capacity. As ‘sub of the day’ hit the target audience their expectation level will rise from basic to little high examples like some dessert varieties and break fasts. Subway can promote its sandwich as customizable and healthy to eat food to those who really care for the diet. THANKS ———————– Subway logo used from 1965 to March 3rd, 2002 Producer Consumers