Growth Strategies Case Study

Subway in 2006

OR

Abstract:
The Subway restaurant chain was the world’s largest submarine sandwich franchise chain and had held number one position since 2001. By February 2006, Subway had opened more than 25000 restaurants in 83 countries. Subway had franchises throughout the US and in several countries, in locations such as freestanding buildings, airports, convenience stores and sports facilities. It employed about 150,000 people worldwide.

The fast food chain was criticized for its franchising policies. It was claimed that Subway was involved in many legal disputes with franchisees, usually for its over aggressive expansion (one Subway was very close to other Subway, which ended in competing with each other) and high royalties. The DAs were blamed as it was in their best interest to saturate markets with Subway outlets in a region. Subway was sued by some of its franchise owners. Subway included arbitration clause in its franchise agreements. As 2006 got under way, the Subway management wondered what direction the company should take.

The case discusses the growth and expansion of a restaurant chain which became number one in the industry in a short span of time. The case also discusses different ad campaigns of the company to gain consumer attention. The case highlights unique business model adopted by the company and its product differentiation strategies. The industry leader is now criticized for its over aggressive expansion policies.

Pedagogical Objectives:

• To discuss the growth and expansion strategy of the market leader
• To discuss the advertisement campaigns of the company and its unique business model.

Keywords : Subway; Fast Food Restaurant; Fast Casual; Growth Strategies Case Study; Sandwich Chain; Submarine Sandwich (Subs); Franchise; Marketing; Advertising; Promotion; Business Model; Industry Leader; Product Differentiation; Nutritious Food

Contents : 
Business Model
Subway Subs and nutrition
Jared Fogle Campaign
F.R.E.S.H. Steps Campaign
Fresh Resolution Campaign