Subway, the global sandwich chain, is planning to double the rate of openings to 300 sites in 2010 - after it slowed down growth this year due to the economic climate.
Trevor Haynes, Subway’s area development manager for UK and Ireland, told M&C Report that the company would accelerate openings to bring them back to the levels of the last three or four years, after it launched only 150 outlets in 2009.
He said that the company, which is set to open its landmark 1,500th store before the end of December 2009, was on track to reach 2,000 sites by the end of 2010.
Haynes said that he believed that overall Subway had the potential to more than double in size in the UK and Ireland, where there is currently one outlet for every 44,000 people, to reach the rates of Australia and New Zealand, where there is one store for every 19,000 people.
Haynes said: “The UK Subway market has traditionally grown with existing franchisees, but we are seeing a lot of interest from new people wanting to become franchisees as they face redundancies and are looking for reputable brands to put their equity into.”
He also said that the company had benefited from new opportunities on the high street as some chains disappeared or downsized and landlords became more flexible.
“A lot of high street locations have opened up for us as landlords are offering lower rents and are open to negotiating on allowing more tenant favourable clauses into leases.
“Some locations we previously couldn’t afford to be in have now been revisited, as they have become more attractive as rents have dropped, meaning that franchisees can make money from day one,” said Haynes.
Haynes said that he believed that Subway’s success was due to the low cost of entry for franchisees, which had remained at around £200,000 per site for the last few years.
“The business is based on the entrepreneurial spirit of franchisees and the number of multiple operators that want to keep expanding. For franchisees to make a profit there needs to be a competitive level of entry,” he added.
The company said that like-for-like sales had flattened out at the start of the year, but it had seen a small rise since the summer as a result of increased traffic meaning that LFLs were on track to be flat in line with last year.
Average spend, however, had remained consistent at around £4 per head.
