The Subway Story
Where it All Began
The Subway® story began in 1965 when 17-year-old Fred DeLuca asked his
family friend, Dr. Peter Buck, a nuclear physicist, for advice on how to pay his
college tuition. With an idea to open a submarine sandwich shop and an
initial $1,000 investment from Dr. Buck, the two formed a business
partnership that would ultimately change the landscape of the quick service
restaurant industry.
The partners opened their first restaurant in Bridgeport, Connecticut, in
August of 1965, where they served freshly-made, customizable and
affordable sandwiches to local guests.
Creating a Strong System
By 1974, Fred and Dr. Buck owned and operated 16 submarine sandwich
shops throughout Connecticut. But, to take the brand even further and reach
their 32-restaurant goal in time, the pair decided to begin franchising — a
business model that launched the Subway® brand into a period of incredible
growth and popularity.
Guiding Principles
As the Subway® brand grew over the decades, Fred and Dr. Buck remained
true to three core values and principles, which still guide the brand to this
day:
Always provide exceptional service to valued guests
Offer high-quality, flavorful menu options at a great value
Never stop evolving to improve the Subway® brand
Subway® Today
Today, Subway® has grown to become one of the world’s largest restaurant
brands, serving customizable and signature sandwiches, wraps and salads to
millions of guests, across more than 100 countries in more than 37,000
restaurants every day. Subway® restaurants are owned and operated by a
franchisee network that includes more than 20,000 dedicated entrepreneurs
and small business owners – who are all committed to delivering the best
guest experience possible in their local communities.
Strengths – Subway SWOT Analysis
Strengths of subway
International Presence: With 37,000 restaurants in over 100 countries,
Subway has a global reach which works as a significant strength. In many
countries, other competitors could reach or tap the potential market. Still,
Subway successfully expanded into emerging markets, leveraging its brand
recognition and adapting menus to local tastes.
Customization Options: People prefer that option for customization, and
the company’s “build-your-own” sandwich concept is a powerful competitive
advantage. Customers can personalize their orders by choosing bread,
fillings, and toppings, creating a unique experience. As a result, it enhances
customer satisfaction and encourages repeat visits.
Strong Business Model: After McDonald’s, companies learned to
effectively and efficiently implement a franchise business model. In the case
of Subway, franchising allowed rapid expansion and reduced capital
requirements for Subway while providing entrepreneurial opportunities for
individuals. As a result, the company has thousands of franchises worldwide,
and more sandwich shops in the USA.
Weaknesses of subway
Low-Quality Control: As we know, there are thousands of franchises of the
company, and It’s difficult to maintain quality all over the place. Because of
that, Subway has faced criticism regarding its low-quality control, which can
negatively impact customer satisfaction and brand reputation. A few years
back, in many Canadian stores, only 50% of meat was found in Subway
chicken, raising concerns about the quality of their products.
Limited Offerings: The brand has its customization offerings, but that is
limited, and because of that, Subway’s menu has been criticized for its
limited variety compared to competitors. The lack of diversification may lead
to customer fatigue and decreased appeal, especially among individuals
seeking alternative options, restricting its ability to cater to evolving
consumer preferences.
High Employee Turnover: No company wants to let go of employees for
whom they invested the training and everything, which is bad for business.
Regarding Subway, the company has been struggling with high employee
turnover rates. As per the data, even though the turnover rate has been
reduced, it is still at 32%, which is still a huge issue.
Recommendations for Subway
Even giant restaurant chains are going out of business, and staying ahead is
difficult in the competitive food market.
Subway should focus on diversifying its menu to combat rising
competition and cater to evolving customer preferences.
By identifying locations with high foot traffic, such as airports, college
campuses, or urban centers, Subway can attract a larger customer
base.
Strategic partnerships with complementary brands can help the
company expand its reach and enhance its brand image.
They should proactively address labor issues to maintain a motivated
and satisfied workforce.
Subway faces rising competition, potential supply chain disruptions, and
labor issues. However, the company can navigate these threats by
diversifying its menu, expanding into new markets, forming strategic
partnerships, addressing labor concerns, and thriving in the fast-food
industry.
