SUBWAY SOUTH AFRICA

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

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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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