Subway Case Analysis
SUBWAY® is the market leader in sub and sandwich shops offering a healthier alternative to traditional fast foods. SUBWAY's® annual sales exceeded $6.3 billion dollars, while countless awards and accolades have been bestowed its chain over the past 40 years. SUBWAY® had 7,825 units worldwide with 7,750 units in North America whilst its rapid growth has attracted many investments and brought it many competitors such as KFC and Burger King. Recent initiatives to attract customers beyond SUBWAY's® traditionally health-conscious consumers should increase the company's share of the fast food market.
Strategic Marketing Issue
Being part of a highly competitive and dynamic market, SUBWAY® faces a strategic marketing challenge as to what specific marketing mix to use in order to sustain a differential advantage while maintaining sales growth and, above all, profitability.
Issue Response
Subway effectively competes with burger chains and others that are in the fast-casual segment of the market. Including healthier meals into its menu and giving much attention to obesity and diabetes have supported consumers' choice for Subway (Tarantino, 2005). However, Subway has not been satisfied thus far; instead, more intensified efforts have been made to improve business during the dinner hour. Additional menu options have also been added to answer competitors' trends and to place more focus on the children's segment.
Proof
Team B's SWOT analysis can be helpful to highlight Subway's 1) internal strengths and weaknesses along with 2) the external opportunities and threats.
In the past few years, the sandwich market has gained incredible popularity in the American culture. As the fast food landscape continues to...
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Despite the economically uncertainty Pret A Manger keeps on thriving in the U.S. fast food market. It’s growing fast, with huge success. Pret is proving to the world its a big threat in the sandwich industry. In 2011, U.S. sales up 40% from the year before, “the company’s overall profits grew by 37% in 2010, and annual workforce turnover is only 60%, compared to fast food industry averages of 300-400%.” (Smart Advantage)
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Subway, one of the present leaders in the fast food industry was set up in 1965 in Bridgeport, Connecticut by Fred DeLuca. A family friend of him suggested this idea to help him pay for his education to fulfill his dream of becoming a doctor. Dr. Peter Buck, one of Fred’s friends agreed to be his partner with a loan of $1,000. There was a huge growth in the business relationship that changed the landscape of the fast food industry.
In every business, there is an analysis called the SWOT, it is the Strength, Weaknesses, Opportunities, and Threats of a company. Wendy’s is a company that is against the use of frozen ingredients and it is a fast food place that has a slogan “Quality is our Recipe”.
Fast food restaurants such as Burger King and McDonald’s, create advertisements where it urges people to consume their product. For example Mcdonald’s created a product where you can get two items such as a mcdouble and a medium fries for three dollars. According to “The battle against fast food begins at home”, by Daniel Weintraub, it shows how companies are intriguing their customers. “ The center blames the problem on the increasing consumption of fast food and soft drinks, larger portion sizes in restaurants and the amount of available on school campuses”(1).For the most part, the Center for Public Health believes that fast food companies are the problem for health
From a study completed by Chicago-based Research International USA completed a study called “Fast Food Nation 2008. The panel consisted of 1,000 respondents of ages 16-65 who provided their inputs with an online survey which was conducted between March 13 through 2008. Which was based on results on fast food restaurants like McDonald’s, Burger King, and Wendy’s are gaining popularity even through the economic hardship and recession. Marketing strategy has become more of influence on kids and young American’s. As population grows and the demand increases of fast food restaurants are expanding their stores to capturing more consumers. Fast food chains are also willing to change their menus to continue to gain and retain repeating customers. With each generation that passes, brings fast food chains into more homes and continues impacting lives.
Schlosser, Eric. Fast Food Nation: The Dark Side of the All-American Meal. Boston: Houghton Mifflin, 2001. Print.
At the age of seventeen, Fred Deluca decided to open a submarine sandwich shop as a way to help pay for his education of becoming a medical doctor. Dr. Peter Buck offered Fred a $1,000 loan and became his partner and 1965 the first Subway store was opened in Bridgeport, Connecticut. They learned through experience how to run a business, with the integrity of serving a high quality product, and providing excellent customer service. Today, Subway is the world's largest sandwich chain with more than 41,000 locations around the globe. The goal is to serve the highest quality foods, and make sure everything produced meets the safety standards from the time it is grown, to when it is put into a sandwich. To insure this, sustainable agricultural practices such as cover cropping, and crop rotation this restores nutrients and minimizes pesticide and fertilizer use. With thousands of restaurants throughout the world, subways supply chain needs to be sustainable and efficient in order to cut costs. Many vendors and suppliers worked with Subway to add or move locations closer to our distributors, and we have implemented many re-distribution centers which help reduce emissions, and provide lower shipping costs. Subway has a Distribution Operational Efficiency program that’s purpose it so find ways to ensure all traveling routes and techniques are optimized, and all the trucks are shipped with full loads to reduce mileage, and be as efficient as possible. Recently, Subway has introduced a process in the United States that consolidates all orders of equipment into a single shipment for new restaurants, and restaurants being remodeled. This helps eliminate excess packaging, and unnecessary non-value added activity at the building site. Subway...
Commercials make the viewer think about the product being advertised. Because of the amount of television children watch throughout the week, it allows the children to be exposed to the information over and over again. Per year, children are known to view thousands of fast food commercials. On a daily basis, a teen will usually view five advertisements and a child aged six to eleven will see around four advertisements (Burger Battles 4). Businesses use this strategy to “speak directly to children” (Ruskin 3). Although the big businesses in the fast ...
Subway has just become the biggest fast food franchise in the United States. They advertise a healthy menu full of all natural ingredients. However a recent experiment by the Journal of Adolescent Health found people consume almost the same amount of calories at Subway as McDonalds (Lesser). Subway is not the only fast food advertising healthy options however. Despite the unhealthiness of fast food, these chains do offer some benefits. Natalie Stein,a writer for the live strong foundation, who focuses on weight loss and sports nutrition points out some crucial benefits of fast food. Stein acknowledges the convince of fast food in her article “What Are the Benefits of Fast Food?” She believes that having fast food restaurants on almost every corner is a good thing. This might be a good thing to some people, but what is too much? The conveyance of fast food chains has driven out grocery stores and ruined a chance at a healthy diet. With obesity growing in the United States maybe it’s time to rethink the actual conveyance of fast
For millions, fast food restaurants are the source of positive associations with birthday parties, play dates and accessible comfort food. For others, they represent a lifeline meal on a busy day, or the secret to quieting a cranky toddler on a long trip because hurrying residents of cities have no time to cook a healthy breakfast, lunch and dinner. Fast food presents even in the lives of people who are trying
When researching McDonald’s through online sources, it is clear that nutrition is a major concern of the public visiting the fast-food chain. Secondary research conducted shows that there are several case studies and other secondary source searches around the same topic. McDonald’s has often been the center of nutritional attention within the fast-food industry. Secondary research shows that the restaurant has recently made changes to the American Happy Meal to reduce the amount of French fries offered and replace the portion with fruit (Strom, 2011). In a study conducted by McDonald’s a secondary source reports the meal cuts calories by 20% for the children’s meal (Strom, 2011). This is a critical move by the organization on children’s obesity is currently a hot topic within food chains and attention is driven by the Obama administration. Secondary research also shows that although the public has major health concerns with the food chain, profits are increasing during a high point of an economic recession (Dahan & Gittens, 2008). Acco...
CHANGING PREFRECE depended vastly on the fast food manus. For example we can mention about SALAD. Now salad was never considered as a part of fast food menu. But with the change of taste and preference, fast food chains like Windy, Taco Bell, and McDonald have introduced SALAD into their menus. This preference is not stopping only with salads. In 2002, McDonald’s introduced great tasting new products including premium salads, n salads plus menu; Chicken McNuggets made with white meat; Fish McDippers; Chicken Selects; and new breakfast offerings like the McGriddle sandwiches. Here as a fast food chain, McDonald did not have to introduce new dishes in their menus but with the impression and image in the market analysis, of increasing demand and chan...
As Americans, we’re always on the go. When hungry and have no time there are many fast and healthy items available. Many people who say that fast food chains is the main cause of obesity in America because there are plenty of fast food restaurants on every block with very few healthy options ("Do Fast Food Restaurants Contribute to Obesity?"). Fast food business are very easy to find and offer quick service, but there are other options that are healthy, especially in urban areas. Restaurants such as Panera offer a range of items that are healthy and offer a quick service for those on a schedule. In addition to these healthier options, it is also possible to pack their own snack or meal. People often become lazy when it comes to just cooking their meals at home. This choice allows the customer, to control what they eat.
Flexibility seems to be the most heavily concentrated component for Subway restaurant which is followed by quality. Speed, cost and dependability are equally the same. The data was collected from primary research by asking Mr. Stuart House to distribute 20 points across the performance objectives. This information was used to construct a polar diagram of Subway as seen above (Appendix 3).