Subway Franchise Plan



Subway Franchise Plan

Introduction of Business plan

The business which I will be developing is the opening of the franchise of Subway. The business type is franchise opening. Subway is amongst the world's fastest growing fast food chains and is expanding rapidly from the past few years. The growth figures show a trend of 45% increase in fast food outlets over the period of time. The primary reason for the increase is mainly the cost of the sub which is most attractive for the consumer (Harris et al, 2010). This is an easy snack which can be consumed at any part of day and is very nutritious as well as healthy. The subway opening costs are very minimal and require a small amount of capital which can be recovered over the period of time. The businesses which are started from scratch take time to get acceptance in the market over the period of time. The rationale for the business plan is that Subway is a renowned fast food chain which is more acceptable among the people. Subway is hygienic and there are proper standards which are followed also known as SOPs. The only effort which I as an entrepreneur had to put in is the effort for starting it and running it. People are fully aware of Subway they are well acquainted with the sub offering it has thus it won't require excessive marketing. This means that we only have to market our presence in the area among the people so that we start having customers. The ambiance of the store also plays an important role and does not carry any limitation by the Subway thus we can create a franchise which is more attractive as compared to other Subway franchises in the locality. Subway only requires timely payments of the royalties which are only 15% of the gross sales. This means that whatever we sale only a certain percentage will go to Subway and there is no fixed. The rest of the store expenses are totally dependent upon the expertise of the franchisor which means that I can reduce the expense and achieve economies of scale in whatever category I would like to.

Benefits of the Business

The benefits of the business are that the start-up costs are very low. From different reviews of the franchise owners published online the average sales of subs on the store ranges from 300-500 depending on the conditions. Thus this response is sufficient enough to generate profits from 2 year onwards. The rented store would be an additional benefit to the franchise operations because the lease costs would be avoided and it will also be effective in exit strategy if there is any formulated due to unforeseen circumstances (Behar, 1998).

Sourcing costs will be reduced because of the bulk buying advantage as franchise and long term cons tracts will also be effective in cost reduction. The purchase costs will be decreased by 10% as compared to any other fast food operator in the market ...