You wouldn’t think a restaurant with more than 39,000 locations across the globe would have trouble getting business. But Don Fertman, chief development officer of Subway, says the brand is trying to get a bigger chunk of the “American stomach.”
This means getting consumers to see Subway as a place to have more than just lunch. The brand has recently expanded its offerings into the breakfast category and is making a push with its $3 offerings before 11 a.m.
“Right now we get about 1.3% of the population eating at Subway every day,” he said. “That’s a miniscule number, because that means 98.7% is eating somewhere else. We need to get more people in the doors, and that is our biggest challenge.”
Grappling with health-care reform is also a major challenge and concern among franchisees, Fertman said. The corporation just held its multi-unit owners meeting, which it hosts twice a year, and had more than 600 franchisees in attendance. The most packed seminar presentation was on health-care reform.
“There was an audience out the door,” he said. “We had outside consultants come in, and explain how it will impact their business depending on how many stores they have, and how many employees they have, and when it will go into effect.”
For those franchisees that were not at the meeting, Fertman said the presentation is available online. The company is hopeful its franchisees will not focus solely on the costs associated with health-care, but on their overall business strategies for growth.
“Our franchise owners are sophisticated enough to understand, it’s not just about the health-care expense. It’s also about their overall business building and how they can manage that,” Fertman says. “They have received a lot of education on building their businesses and are looking at how they can make up the costs.”
And making up the costs can be done by keeping your eye on the prize, he said. Subway’s success comes from its simplicity and the goals that it creates for itself. The next goal on the roster is having 100,000 stores globally, which he isn’t shy about telling to customers today.
“Believe in your concept and believe in yourself enough to set goals,” he said. “Then shout them to the rafters. This motivates you to get them accomplished, and gets people on your side who want to see them achieved.”
The company had a goal of having 5,000 stores by 1994, which it famously hit in 1991. Before achieving this goal, Fertman said CEO Fred DeLuca had the slogan “5,000 Stores by 1994” printed on all of its napkins, on store banners and more, to be held accountable.
“It’s a matter of being more effective, and that’s where our national marketing program comes into play,” he said. “Getting people to understand our value proposition, what we offer and having our voice cut through the clutter.”