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International 2015-07-03

Franchising helped us open 43,936 restaurants in 110 countries

Fred DeLuca, President and Co-Founder, SUBWAY says, competition is always good for business. It motivates you to keep doing your best. In an exclusive interview, he shared moments of his exciting journey and plans for SUBWAY ahead.

Kindly share with our readers your inspiring entrepreneurial voyage

It all began with a suggestion from close-family friend Dr Peter Buck, who helped us start the first SUBWAY® sandwich shop and is SUBWAY®'s Co-founder and partner. Back in July 1965, while visiting Pete and his family, at their new home in New York, both of us got into conversation when I eventually asked him for advice on how to earn money to fund my college tuition. His suggestion was the turning point of my career, and honestly I wasn't quite prepared for it, as I wanted to become a doctor! Pete said to me, “I think you should open a submarine sandwich shop.” Anyhow, I decided to give it a try and with a $1,000 loan from Pete, opened my first sandwich shop in August, 1965 at the age of 17. After some initial hiccups, the business began to pick up and do really well. When we started in 1965, our initial goal was to open 32 restaurants across America in 10 years. We began franchising in 1974. And in 1982, when SUBWAY® was successfully operating around 200 stores, that was when it dawned on us that it might be on its way to something big. Today, SUBWAY® is present in 110 countries with over 43,936 restaurants operated by our franchisees.

What inspired SUBWAY to take franchise route globally?

When we opened our first restaurant in 1965, we had set a goal of opening 32 stores within 10 years. And originally we had rejected the idea of franchising. But then our expansion plans did not quite meet the timeline we had set and fell behind. That was when we reconsidered taking the franchising route. Thereafter, the first franchised SUBWAY® location, opened in 1974. Slowly, the business picked up pace and soon SUBWAY®'s restaurant count in America was touching 200 units in 1982. This encouraging trend inspired us to push the envelope further and introduce our business overseas thus taking SUBWAY® sandwiches to audiences, globally. SUBWAY®'s health and freshness focused menu was its USP. When coupled with our franchising model, it worked well for the brand, outside of America too.

What do you think are the major challenges for fast food chains these days?

Given the ever changing consumer dynamics, where a majority of them are focused on the health aspects of the meal on their plates, how swiftly one innovates and adapts, remains the key challenge. To stay at-pace with these consumer dynamics, a brand should be able to adapt quickly without compromising on the quality of its offerings.

What are SUBWAY®'s expansion plans in India and globally in 2015-16?

It was in 2001 that SUBWAY® opened its first store in the Indian market. Today, we have 500-plus franchisee-operated restaurants in the country. If we do a good job, we should be able to expand this number significantly. We would work towards reinforcing our presence by engaging more entrepreneurs who will find SUBWAY®'s business model very promising.

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