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troyhouse Joined
Mar / 2006

Franchise advice - Subway/Walmart

Hey guys,

I am not in the franchise business, but have done a lot of research and almost decided to buy an existing Subway store in Walmart.

Subway has recently started partnering with Walmart and Subway has become the food court in Walmart. Apart from Subway sandwiches, store is authorized to sell Pretzels, Popcorn, Candy, as it is in Walmart. This particular has been opened only since June 05 and doing an avg of 4800+ sales per week. Store I am looking is in very busy neighboorhood, flanked by Mall, Home Depot, Office Depot, Circuit City, Best Buy and many other stores. With proper marketing, sales could be easily increased to upwards of 6000+/week. Store will be operated by family members, so the payroll also comes in house along with the profit.

I am very much aware that being a first time in food business, this is very tough task, long hours and who knows what. But, one has to take a decision some time and just do it.

But having said that, I wanted to get the opinions of everyone on this forum. If you have any experience with Subway in Walmart or Subway in general, please provide your thoughts/feedback/advise (negative or positive, I will appreciate all).

What should I look for in a franchise (assuming anything :) )?

Thanks,
Troy

troyhouseJoined
Mar / 2006
troyhouse

Hello Everyone... I am a newbie here, but I will really appreciate some insights to my question posted. Please Help...!!! Thanks in advance.

CoffeePeddlerJoined
Feb / 2006
CoffeePeddler

Hi Troy. I'm relatively new myself, and don't have any direct experience with the Subway franchise. However, I am opening a coffeehouse and have done some research on franchises, in general. I think it boils down to what you are looking for in a business and your personality. If you want or need a lot of direct guidance on menu offerings, purchasing, food prep, marketing, etc., a franchise may be the way for you to go. If you have a more independent and/or creative personality, you will probably want to do something on your own, so you have the flexibility to serve what you want to serve, decorate how you want to, and buy from whom you choose. As franchises go, I would think Subway would be a safe bet, given their name recognition and length of time as a franchisor. I chose to go independent for my coffeehouse, for the flexibilty mentioned above, and because I didn't like the idea of paying royalties to the franchise for the life of the business. One thing to consider is that you pay the royalties to the franchise company regardless of whether you are making a profit or losing $$. Good luck! Marty

BurgerMan1Joined
Jun / 2003
BurgerMan1

First thing I would consider is the actual lease agreement. In particular the length of the terms, renewability and most important, how much control does Walmart have ovre putting you and the franchise out. I've seen several of these in Walmarts and they change on a regular basis. That would be the first major concern. HB

Brandon94275Joined
Feb / 2003
Brandon94275

I like Subway as a franchise. Lots of support. Good franchise to start into the food business with. I don't like locations inside stores though. Limits the traffic too much. Other than employees of Wal-mart and surrounding stores, don't expect to get too much traffic from outside of the Wal-mart itself. People who eat fast food don't want to park and walk into a Wal-mart to get it. Even though Wal-marts get great traffic, by having the Subway inside a Wal-mart, you've already shrunk your market by a very large margin. The average Subway does around $450,000 per year in sales. This one is low at $250,000 because the location is a weak one. Never expect marketing to overcome a bad location. It does happen, but very very rarely, and it's not something you can count on. If it were up to me, I would look for another opportunity.

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