Are you familiar with the Subway franchise opportunity?
Are Subway franchise owners happy? Why or why not?
Please share your thoughts and opinions below.
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According to Entrepreneur’s Subway Hits the Spot, “…In late 2008, the company surpassed the 30,000-restaurant mark. It has 1,600 stores scheduled to open this year. Another 2,400 franchisees have bought in and are waiting in line to open. And it’s on pace to overtake the king of fast food, McDonald’s, in outlet numbers within five years.” Despite a disastrous economy, Subway CEO Fred DeLuca says 2008 was Subway’s “best year ever.”
DeLuca claims their secret to success is the value Subway provides to their franchisees and the simplicity of the concept:
“We work hard to be extremely efficient,” he says. “We give great value for our franchisees: They can build a store for well under $200,000. And we have extremely simple operating systems. The preparation is mostly done in front of the customer. That simplicity is really what attracts our franchisees. You see it, and you can do it”.
Detractors claim that the hype has been bought and paid for, that the Subway franchisor is tyrannical and the system is designed primarily to make money for the franchisor at the expense of Subway franchisees.
WHAT DO YOU THINK? DO YOU OR HAVE YOU OWNED A SUBWAY FRANCHISE? ARE SUBWAY FRANCHISEES HAPPY? WHY OR WHY NOT?
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Do not buy a Subway! In illinois alone, the famous comment of all the development agency is you will sue us if we tell how much you are going to make. They don't tell you because you don't make money, even if you have a "cash cow" store.
Fred Deluca has used fear and intimidation among the developers.
The good news is seriously, God has blessed me so we are going to be ok, however God HATES dishonest scales so Subway corp will fail.... that's why its good to get out.
One DA employee said when questioned about her unethical practices of when selling a store, said I am not at liberty to answer that.
They also use and abuse people from India, they play on their culture and use them, that is what a DA employee told me before she got caught.
As a seasoned former Subway owner, Development Agent, and a current Subway transfer specialist, I have seen everything; some of the abuse and some of the great things about this franchise. Overall, if you toe the line you will be alright, and if you buy right, you will not regret your purchase. The ones who got burned are the ones who did not do their due diligence well or did not adjust their attitude when they should have. I do also see where the blame lies with Corporate or with the Development Agent office on occasion and have heard many horror stories that are never printed anywhere-but this is RARE.
There is much information I possess and have elaborated on my website to make your Subway purchase/sale a decent experience.
I continue to advise buyers and sellers to make their entry or exit less smoother as I understand the transfer process from every angle fo over 25 years
Fayaz Karim
http://www.mrfranchiseman.com, Subway Specialist
Former Subway owner for over 5 years multiple stores. At first it was profitable but it only took a year for Subway to come up with the $5 footlong which was a instant hit. Sales soared, profits deceased for the franchisee. The local DA kept feeding us the Kool-Aid that this discount program was great for the franchisee. When you increase sales on a lost leader product your gross profits drop like a rock.... Bottom line was almost every person that bought a $5 footlong was a premium sandwich and 90% of the time never bought a drink or cookie. Store went from making $80,000.00 a year to when I checked out last year $24,000.00. Then corporate Subway decided to heavily discount products every month. Corporate never had marketing plan that didn't require a discount....Great for corporate Subway because they take over 13.5% off the gross....They don't really care what your net is as long as you don't go out of business.
Bottom line is Subway is one giant legal Ponzi scam where Freddy loads the gold in his wheelbarrow....and the franchisee/owner take it up the @ss...
You want to be frustrated answering to local management that uses tactics right out of Nazi Germany... get a Subway franchisee. Where as a "owner" your just a employee of corporate and if you don't drink the Kool-Aid they put you out of compliance and take your store.....Wait...in 3-5 years the Subway house of cards will fall.
Did you sell your stores or just close them? Do you think you made money on the sell of your stores and will you go into another food operation? I did the math when I investigated subway and decided I could lose money or as you said, make very little. Can't figure out why the stores turn so quickly.
My local subway has had 4 owners in the last 5 years.
Never Never buy this frachise. It's all about franchise making money. They don't care about you make it or loose. I've seen restaurant doing less than $4000 a week volume. What kind of concept is it? Is this a food business or scam.
How can you survive in $4000 volume where you have to open 7 am to 10 pm everyday. There are development agent stores are doing 25,000 above a week and they will make sure that more than a miles in surrounding area there no other subway stores. If you don't listen to Development Agent he will threat you to close down. If you want go back slavery then you sign up or you paying for your bad karma.
How about that subway lawsuit with length of sandwich?
I just had some very unpleasant experience with the local development office in North Carolina. I was thinking about buying a franchise since last September. Of course, before I commit the rest of my life with all I have, I wanted to be sure this is the right option for me. So I slowed down the process in order to find if the local development manager considers on behalf of franchisees at all. Unfortunately, the answer is NO-NO!!! They don’t want to consider anything on your behalf!!! NOT A TINY LITTLE BIT!!! I have to say that I did not rush to pay the franchising fee and buy store. How about if the local development manager simply ceases your store and cancel your contract. I would think that every potential franchisee is committed if they want to sign a 20 years contract and put together all they have. BUT, YOU JUST NEVER WANT TO RUSH TO IT WITHOUT KNOWING IF THE OTHER SIDE TREAT YOU EQUALLY!!!
I am disappointed with this particular development manager in North Carolina. But, considering the fact that this is the very person who could shut my store down 2 or 3 years down the road for whatever reason he thinks, I have to feel lucky for not going further with Subway!!!
My parents owned two subways back in the 1990's and they were hard to deal with then but nowadays I've heard horror stories. Do not buy a subway for any reason. The corporate people will loot you for everything you have and local development agents are corrupt little tyrants who maliciously wield power. Subway only cares about their bottom line and not the individual owners. Restaurants like McDonald's are well run and you only see a few around town but subway undercuts their own franchisees by cannibalizing their profits through opening more and more stores. This works well for corporate since they collect endless fees and royalties but keeps individual owners in perpetual anxiety over breaking even.. Stay far away from this vile company for the sake of your finances, family, and well being.
I used to work for a DA in ??z, Got burned by a certain individual who bought the great 20k stores for himself and left the crumbs for the rest of us to fight over. Not to mention if a store was doing 15,000 anywhere he would build a store next to it, Pissed alot of owners off. Anytime a owner would say something. boom!! Get ready to lose ur store...sad sad thing!!