[Draugen]

Hello all! I came accross this thead whilst Googling print suppliers believe it or not! I feel this may become a long post, so please bear with me!

I'm a Subway franchisee in the North of England and have read this thread with interest. I'm not familiar with the town of Harwick, so I can't comment on whether or not it is a viable location, I can offer some reasoning behind why Subway would wish to open there however. There are also one or two other points I'd like to comment on.

I feel it's somewhat unfair to assume that the franchisee of this store has not done their homework. Subway have made mistakes, as all brands of our size have, but they happen rarely and in the current climate, even our development agents are being very careful over the locations currently being opened. Perhaps the Subway franchisee has spotted a market you haven't? Don't forget, Subway and BE do not compete as directly as some might imagine (as mentioned earlier in this thread), a franchisee with a good knowledge of the brand may have seen opportunities not relevant to the likes of BE.

Everytime Subway opens in an area without a lot of money, there are naysayers. The fact is though, we often thrive in these locations. I own a store in one of the most deprived areas in the country, and it does well. When the product is as good as I believe ours is, people will pay for it. Our target demographic will also travel some quite considerable distances to eat at our stores!

In terms of who might wish to open in a location such as this, it sounds as though it is likely to be a multi-unit owner, possibly even a development agent. When you own a number of stores, it becomes viable to open low-profit stores and if you have a significant number of units, it is viable to "test" stores in certain areas. Of course, it costs money to open, but if the store fails, the costs of closing it and moving the fittings and equipment elsewhere are fairly minimal. That's a risk many are willing to take.

I know it's a common criticism of Subway that they make money regardless of whether or not franchisees are in profit, but at the same time, it is not in their interests to open stores that close down a few months later. Subway have made mistakes in the past, but we genuinely do not open stores where are not likely to make money.

Just a few things I'd like to comment on:

My brother was assistant manager of a Subway in Glasgow, if you'd heard the horror stories he told me about food management and hygiene you just wouldn't buy anything from Subway!

If your brother's stories are true, then that is an isolated and very badly run store. Subway's standards of hygiene and cleanliness are higher than most of our competitors and each store is evaluated on a monthly, and in some cases two-weekly basis to ensure these standards are kept. I have never have cause to doubt the hygiene in any Subway store and that includes my days as a customer before becoming a franchisee!

Subway requires a huge footfall

Of course, footfall is essential but to describe the requirement as "huge" is an exaggeration. The average spend in Subway is very high for our industry, so we do not require the customer numbers some might imagine.

He is tied to a menu and a price structure.

Franchisees are not tied into a pricing structure, we are free to charge any price we like for our products.

I cant wait to see subway compete with my business and with the local bakers, most who have been established for many many years in the Town.

I feel you're underestimating the power of the brand a bit here. I have never known Subway to struggle against local businesses. Of course, there's competition between them, but I have only ever seen evidence that we co-exist with them to the benefit of both parties. I have a store with three small sandwich shops and a Greggs in the immediate area, we all seem to do just fine. People come to us not because they want a sandwich, but because they want a Subway sandwich. If price was the only factor, Greggs would have buried us ages ago!

franchisee's pay subway 8 pc loyalty plus 4.5pc advertising fee

The 8% royalty is correct, and this is paid direct to Subway. The advertising contribution is not paid to Subway however, this is paid into a franchisee administered advertising fund. In my region we pay 5% rather than the 4.5% in most territories and I personally feel the money is well spent.

Subway emphasises they have a good product. However, BRAKES supply the majority of their products.

Brakes did not supply Subway's products, they merely delivered them. We actually parted ways fairly recently and our distribution contract switched to 3663 last week. Both Brakes and 3663 are merely distributors, our products and ingredients are sourced elsewhere. (Subway's meat in the UK and Ireland is manufactured and supplied by Dawn Farm Foods, if you're interested)

here link to the shop they are taking, looking at the price of the rent then add a lot more for rates, oh dear - thats a lot of money.
What the rent alone is costing per annum, that equates to 3 years worth of rent AND rates for my shop

Don't forget Subway has a lot of bargaining power when it comes to leasing retail property. The published rent is rarely what the franchisee will actually be paying. Substantial rent free periods are frequently found in our leases also.

I had to laugh my $ss off today, apparently when Subway instructed Chrysties and other tradespeople to carry out their work on the Hawick shop a few months back, which was completed by some of the workies, subway never asked the council for permission to carry out the work ! DOH

They shouldn't need permission to carry it out! Subway stores all require A1 consent, so we can effectively site ourselves anywhere! It's only external features in conservation areas, signage and issues with listed buildings that should pose any barriers. Personally, I have never come accross a Subway store that has had to suspend construction due to planning issues.