STRATEGIC MANAGEMENT OF SUBWAY

HISTORY:
Subway prides itself in being a healthy fast food chain offering a variety of sandwiches and subs Founded in summer of 1965, by Fred Deluca and investor Dr. Buck As a growth strategy, and in effort to increase profits, they embarked on the idea of franchising their business

VISION:
Be the no 1 Quick Serving Restaurant (QSR) franchise in the world, while delivering fresh, delicious sandwiches and an exceptional experience

MISSION:
Delight every customer so that they want to tell their friends- with great value through fresh , delicious made to-order sandwiches and an exceptional experience

GOALS:
To build our business relationships by serving each other i.e. our customers & our communities, much as we do within our families

OBJECTIVES:
We challenge ourselves each other to succeed through teamwork, against shared goals and to be accountable for our responsibilities

STRATEGIC INTENT:
Formulating a unique value proposition Targeting an underserved customer segment Structuring an aggressive franchising model Expanding Internationally

BUSINESS MODEL:

The team offers a diversified portfolio of new and promising ideas that will improve the subway experience for franchisees and their customers Franchising involves low start up cost in which less equipment is needed i.e. countertop, oven, refrigerator & microwave, Small area is needed and real estate costs are low Lowered operating costs which therefore raise margins: i) $12,000 Vs $45,000 for McDonalds ii) Makes it appealing to investors Doctor Associates Inc. (DAI) is the trademark holder and franchisor of SUBWAY

MARKETING:
EAT FRESH (slogan) Higher perceived value against competition Custom sandwiches tailored to customer Appeal to young professionals

COMPETITORS:
Subway uses its own products against the competition in their quest to elevate themselves. Subway says look at how bad McDonalds or Burger King is for you and look how great our food is for you. The names, products, and health information of different brands are listed right on Subways packaging and marketing material.

SWOT ANALYSIS:
STENGTHS:
TEAMWORK: We challenge ourselves each other to succeed through teamwork, against shared goals and to be accountable for our responsibilities FRANCHISE BRANDS: this team offers a diversified portfolio of new and promising ideas that will improve the subway experience for franchise and their customers Higher perceived value against competition EAT FRESH (slogan)

WEAKNESS:
Location Product saturation

OPPORTUNITIES:
COMMUNITY INVOLVEMENT: Many of the franchise owners and their employees help support their local communities through monetary and product donations The J Curve principle of upward growth of subway indicates its high profitability in future

THREATS:
Strong competition

BALANCE SCORE CARD

FINANCIAL PRESPECTIVE Increase market share Faster production & delivery time Cost leadership Efficiency & delivery

CUSTOMER PRESPECTIVE No of new customer Retaining existing customers Speed Pricing Quality Service

PRODUCTIVIY & SALES

INTERNAL BUSINESS PRESPECTIVE Order delivery time Production Globalisation

LEARNING & GROWH PRESPECTIVE Knowledge based Training & Development Technology Investment in

FACTORS LEADING TO ORGANISATIONAL CAPABLITY COMPETITIVE ADVANTAGE

ORGANISATINAL RESOURCES: Franchisee

ORG BEHAVIOUR/WORK CULTURE: Teamwork & Family Note: Subway maintains its core value by building business relationships by serving each other customers & communities much like a family

STRENGTH: Teamwork, Franchise Brands, higher perceived value against competition WEAKNESS: Location,

SYNERGESTIC EFFECT: Faster growth, profit generation COMPETENCIES: Franchisee, unique store location

Note: Unique store location includes such as airports, amusement parks, stadiums, colleges, & Universities, hospitals, military bases, supermarkets and truck shops

ORGANISATIONAL CAPABILITIES

1) Financial Capability- responsible for tracking, organising and reporting on the financial activities
with DAI (Doctors Associates Inc.)

2) Marketing Capability- It includes research & development which develops test markets for the food
that is being served. FAF (Franchising Advertising Fund)- responsible for creation and placement of commercials and print ads. 3) Operational Capability - It enforces standards and provides training and operational assistance to franchises and field staffs 4) Legal Capability- This department is responsible for ensuring DAI & SUBWAY comply with rational and international laws, customs & ordinances

5) Executive Capability- This team supports company wide operations at Subways headquarters in
Milford, CT and includes departments like customer care and the business process team

6) Administrative Capability- This team is responsible for DAI employee management and grounds &
shipping centre oversight 7) Franchisee Brands- This team offers diversified portfolio of new and promising ideas that will improve the SUBWAY experience for franchisees & their customers

COMPETITIVE ADVANTAGE: Franchisee Expansion

VRIO APPROACH
Are the capabilities valuable YES Are the capabilities Rare Are the capabilities costly to imitate NO Are the capabilities organised for uses YES Are the capabilities strength or weakness Strength and distinctive competition

YES

ASSIGNMENT ON STRATEGIC MANAGEMENT OF SUBWAY

BY ABHIRUP DAS GUPTA Roll no: 01/D/2010

Submitted to Md. Irfan Ullah