Franchising Subway Franchise

Of course you get economies of scale

I used to be really chummy with a guy who owned a small restaurant. We were discussing wehter to use small individual coke bottles or just get them from the super marker.

The supermarket was 1.30 per litre while it worked out a bottle was something like 1.50 per serve

Ie he could have used a 1.25 litre bottle and thrown out the remaining litre for the same cost.

So we decided to use the bottles.

No brainer for him at the time

 

Ps so how much would one of those 15l syrups cost for a small business

 

It was about $250+GST when i last ordered one 5 years ago. I asked a mate on Friday what he pays (standard volume pub) and he was at $300 but has swapped to cans/bottles as you also have gas cyclinders and electricity to run the postmix machine and it all adds up. He isn't a high volume nightclub so doesn't need postmix

On the other side, I've done some work with casino's and cinemas who pay $50 for the same product.

 

This is coke by the way - pepsi were cheaper

 

Wow almost 300 for a tub of sugar!!!!!!!

So you get about 75 litres . Thats some expensice stuff

 

Hahaha I'm sure I have a thousand retail stories of idiots that I could share. The rubbish thing is so common our neighbouring shop owner used to bring a spare shirt chuck it on over his uniform and if someone ordered from somewhere else he would go and sit with them and start eating their food until they left. We get along well with our local subway and do food swaps and were sharing stories. The owner said a guy turned up didn't pay for anything and had 6 empty 1.25 litre bottles of drink and started filling them up with the post mix.

 

That isn't high. Actually that's low. I know of a certain franchise kiosk that was in a decent Northern Sydney shopping centre that was paying 120k per year. A KIOSK! ! That was 6 years ago. Imagine now after annual increases.
Edit - just saw you were referring to SA. Sydney is way more expensive.

 

It's the rent.

 

my business in melb in a smaller shopping centre wasnt a kiosk but hospitality, the rent was after negotiation, $2200 pw inc gst , and that was 2011,

add 5% CPI increases everyyear! scary stuff,

the 2nd shopping centre that asked me to open something in a slightly larger shopping centre with similar size and less exposure asked for $3000 per week (cant remember if that was inc/ex gst)!

Obviously I said no

 

Its really high. I'm talking about a food court sized fast food place on the outer edges of metro.

Compared with a decent office close to the city for half that price.

 

Yes I edited my post. I didn't realize you were talking about Adelaide. In Sydney that's low. Also office spaces aren't leased at same rates as commercial retail are they?

 

One would hope you gave him an equally appropriate reference. Later, when he worked out that living in a charity bin carries the risk of waking up on fire, due to people throwing lighted matches in it at miscellaneous times, he worked out the gravity of his prior behaviour.

 

oh cmon, tell me you werent young and stupid once?!?!!?

obviously his behaviour wasnt appropriate, but its one of those things that you think you're never going to get caught!

look at me now!!!! now just stupid and old!

 

How dare you call me old!

 

I don't think that's reliable info... it would be biased.

If other franchise owners bought subways it would cannibalism the sales of their own store.

if I owned a subway I would dread someone else opening up another store. that would be the last thing i want so of course i'm gonna do everything in my power to influence you not to open a store.

It seems silly with any industry. If you are making a bucket load of money (economic profit) it would be foolhardy to inform others of your economic profit as it would just drive more people to enter your market and drive down your economic profit until you are just making accounting profit (zero economic profit...) The most logical thing to do would be to keep silent. and make it seem you are not making profit.

After reading this thread, it made me not wanna buy a subway or any franchise.

Seems the best advice was the bit about the business is not food but buying and selling franchise stores.

 

McDonald's develop property, sell franchises, collect rent, sell the food chain. They don't sell burgers.

 

I have said it before... they are not in business of selling burgers they are in property business... I used to work for them! They plan 10-20 years ahead.... best part is whenever you want to sell or buy franchise they collect a fee! I have seen so many times when KFC, pizza dominos or hungry jacks pay rent to maccas....hehehe

 

Have you considered opening a store similar to subway using all fresh ingredients ,and keep it bright and clean in an area where subway isnt .Buy the equipment from ebay or a shop seconds store or similar ,Sell for slightly less than subway and look after people -I reckon you would have a much better chance of succeeding ?!!

 

Dunno that sounds like a really bad idea.

Obviously subway seems to be a declining business in terms of product life cycle.

And by opening a new one thats fresher is only adding a small benefit to the existing product.

I dont mind subway but i dont find it special at all. The only reason i go there is becauae i know i wont get charged 12 dollars for a regular roll at a smaller boutique place and its convenient.