Three Tenets That Drive Subway's Growth

Nontraditional locations, healthy options earn QSR leadership award

Abbie Westra, Director, Editorial, CSP

Subway earns CSP leadership award

MILFORD, Conn. -- Subway's game-changing marketing, aggressive activity in nontraditional channels and early focus on nutrition have all had a remarkable influence on the entire foodservice industry.

This significant impact achieved the quick-service-restaurant chain one of four Leadership in Foodservice Awards, handed out this past week during CSP’s 2014 FARE Conference in Dallas.

The company is rooted in three tenets: value—best reflected in the iconic $5 foot long—as well as indulgence and health.

“We look at health first and foremost because it has an overarching value that we have: to provide something that’s better for you, something that’s fresh, made to order,” said Don Fertman, Subway’s chief development officer. “With fresh vegetables, freshly baked bread. That’s a very important part of our business model and our product mix. But at the same time one can get something that’s indulgent.”

While value, health and indulgence are essential to Subway, the brand is nothing without the strength of its front-line work force.

“A big focus is on what we call Recruit, Train and Inspire the Subway Family,” Fertman said. “We have to recruit the best sandwich artists, we have to give them the best training the way they want it delivered, which is in this day and age online, on our iPhone and social media, and also have it inspirational. You have to get people excited and motivated these days. So it’s the way we deliver the message as well as the method we deliver the message to our front-line folks.

What’s perhaps most impressive about Subway is its sheer size. Store count has reached over 41,000 stores in 106 countries, with expectations for 50,000 stores by 2017. Fertman envisions a future where 100,000 Subways dot the globe.

A key element to that store count is Subway’s focus on nontraditional locations. Twenty-three percent of the chain’s stores are considered nontraditional including c-store, college and hospital locations, and the store count is expected to reach 10,000 by the end of the year.

“We’re in everything from airports to zoos—the A to Z of nontraditional locations,” Fertman said. “And it’s a great niche for us because we are very flexible and we can fit into just about any space. Give us 300 square feet and we’re there.”

A few locations are found in unlikely places, including a riverboat on the Rhine in Germany and two stores inside of churches that provide job training and community outreach.

“Let me tell you my favorite Subway nontraditional location, and that is one that we in essence built out a storage container and we created a Subway store in this large storage container,” Fertman said. “And we hooked it up to a crane and when they were building the freedom tower, the new World Trade Center, we went up floor by floor as they built the new world trade center. And we fed the workers every day that they built that building. And that was something that I was always proud that we did and also excited about because it shows the true possibilities of the brand.”

Next year, 2015, will mark the 50th anniversary of Subway. Fertman and his colleagues are reflecting on the multiple generations of customers, franchisees and employees the company serves, and how it can continue delivering value, health and indulgence well into the future.

Abbie Westra, CSP/Winsight By Abbie Westra, Director, Editorial, CSP
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