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How much is a Subway franchise Cost, Profit Margin & ROI in 2024

How much is a Subway franchise Cost, Profit Margin & ROI in 2024

By Startup Authority

Are you planning to start open your own QSR (Quick Service Restaurant) which is profitable and within a budget? Then Subway Franchise can be the best option to start with.

Here in this article, We will learn about how to start a subway business franchise? Investment in Subway store, Profit margin, and so on.

Want to start a subway franchise in India?

Subway is one of the most popular American restaurant chains and the world’s Largest fast-food store in the count. It has more than 44,000 Stores worldwide. Subway was Started in 1965 by Fred Deluca and Peter Buck.

Subway started its QSR business in India in 2001 and from then till 2013 Subway was able to open 500 stores in 2018, the company added 150 more restaurants store. Today, Subway targeting to open more than 2000 new subway stores in India.

Founders of Subway Franchise

Subway sandwiches are one of the most delicious sandwiches that are available in the market. The range of customization offered by the brand makes you order more and more. Did you know?

Currently, Subway serves about 5300 sandwiches every 60 seconds to consumers. Now, that makes 320,000 sandwiches every hour are being ordered from Subway. Subway was founded by a very young 17-year-old boy Fred DeLuca back in 1965.

It was his friend Peter Buch who lent $1000 to Fred to start “Pete’s Drive-in”. Just after three years of business that name changed to “Subway”. The first franchise of Subway began back in 1974 in Wallingford.

Later, the company saw huge success and started opening up outlets in various parts of the country. Unfortunately, Fred DeLuca the company’s first CEO died of leukemia in 2015.

Subway opened their first restaurant in New Delhi and became an instant hit. Due to religious beliefs, Subway did not introduce any beef products. They were on the safer side ever since they made their entry into the Indian market.

Subway used unique yet catchy techniques to expand its business around the world. The simple method they used to grow was to use their franchise-only model. Subway soon realized that its revenue was rapid through franchising. Also, Subway focussed on various changes in its food quality.

Back in 2011, Subway introduced gluten-free products into the American market. This new gluten-free product reduced the salt content in most food products by 15%. This attracted lots of consumers at least in the American market. In India, Subway renewed its delivery networking system.

They partnered with some of the well-reputed food aggregators. They introduced mobile ordering, Wi-Fi, and customization in the food items. This is how Subway as a brand became famous not only in India but, all over the world.

Why choose subway franchise?

Check here the best reasons to choose the Subway franchise:

    • Subway is the 2nd largest restaurant chain in the world after McDonald’s.

    • Subway has 44,210 restaurants in the world and more then 650+ Store in India.

    • Subway Serve meals with Fresh ingredients and fresh vegetables

    • Subway is one of the fastest-growing franchises in India.

    • Subway provides no cooking, frying and grilling meals.

    • Subway leadership are flexible with the franchise and with space requirements.

    • It provides a comprehensive training course and complete support from their Subway franchise headquarters, State Development Agents and field executive staff.

https://youtu.be/6DQ4n1KEdSY

Subway franchise
Subway Franchise Business

Subway Franchise Menu and Best Products

Indians have always been great admirers of western people. Even though the British looted India they are a great admirer of the British people. English food, fashion, and entertainment are all greatly loved by Indians.

In the same way, the thought of Subway sandwiches has been inherited into the minds of Indians. People just wanted to use all of Subway’s facilities to have an English feel.

Subway Veg Sandwiches

    • Veggie Delite

    • Chatpata Channa

    • Hara Bhara Kebab

    • Mexican Patty

    • Veg Seekh

    • Aloo Patty

    • Paneer Tikka

    • Corn and Peas

    • Veg Shammi

    • Veggie Patty

Subway Non-Veg Sandwiches

    • Italian B.M.T

    • Chicken Teriyaki

    • Subway Club

    • Turkey and Chicken Slice

    • Chicken Tikka

    • Chicken Kofta

    • Roasted Chicken

    • Chicken Tandoori

    • Chicken Slice

    • Peri Peri Meals

Subway Beverages

    • Fountain

    • Bottled Water

    • Bottled Beverages

    • Tropicana Mixed Fruit

Subway Slides

    • Cookies

    • Chips

    • Chocolate Truffle

Subway Indian Favourites

    • Aloo Patty

    • Chicken Kofta

    • Chicken Teriyaki

    • Chicken Slice

    • Corn and Peas

    • Mexican Patty

Eligibility Criteria for Subway Franchise

You just cannot start a Subway franchise there are certain requirements or criteria you need to have. The eligibility criteria for a Subway franchise are the following:-

    • Must be at least 18 years old

    • He/She must not have a criminal background

    • Possess an entrepreneurial spirit

    • Enjoy working with people and have a team spirit

    • Must be committed to building a successful business

    • All must have the will to learn new skills and face exciting challenges

Requirements for Subway Franchise

To Start a Subway franchise, you need to have a store in the most demanded place where you can get quality footfall. If you have your own space then that will be a perfect option but if you don’t have you can go rented space.

Space Requirement

170 square feet is required for the food court and 350 square feet is required for the non-food court. If you have more area then that would not be a problem. This is the minimum area that an interested franchisee owner should have.

Interestingly, this also someway becomes the eligibility criteria for them. The proper areas for washrooms, billing counters and other such kinds of things should be spacious.

Man Power requirement

You need at least 8 people to work in a Subway outlet. Another main resource to start a Subway franchise is having the right people.

Proper training and knowledge of work is a must for people to be able to handle daily activities. Motivation is yet another important point to play here where people should work to make the franchise a success.

Experience and Expertise

You do not need any experience to open a Subway franchise but, the will to run it successfully must be there. One Masterchef will be sent from the parent company to train your employees. Managers can take part in an intensive two-week program.

Documents Required

    • Passport size photos

    • Aadhar card, PAN card, Voter Card

    • Rent agreement

    • Electricity bill

    • Canceled cheque of active bank account

Investment required for Subway Franchise

Investment is one of those things that proves to be quite crucial for the business at its initial stage. Investing details would be provided to owners when they opt to open up a Subway franchise.

In India. Presently, Subway holds more than 353 franchise restaurants in India. How much is the investment and franchisee fee? The total investment required to start a Subway franchise is between Rs 25-30 lakhs. Now, you need to at least pay Rs 4.5 lakhs as a franchise fee.

Subway Franchise Cost

Subway India franchise cost can go up to Rs 6.5 lakhs. Other than that, other fees are asked by the parent company. The company asks approximately 4.5 lakhs as Franchisee Fee and 3.5% to 8% of the net sales are charged as Royalty fees and Advertising costs. The total cost could be up to Rs 25-30 Lakhs and not more than that.

Royalty Charged by Subway Franchise

Subway charges about 3.5% to 8% of royalty and advertisement fees from Subway in India. It required around 8 people are required as manpower to run a Subway Franchisee. Generally, the operational cost of a Subway Franchise is around 1 Lakhs per month and the break-even is the minimum rate of 40% per year.

How to Open a Subway Franchise?

To open a Subway Franchise, You need to follow the few steps as mention below

    1. Request for franchise brochure.

    1. Submit Application to get Franchise.

    1. Meet with the Local Development Agent.

    1. Review Disclosure Document of Subway franchise.

    1. Conduct Local Research in are of your future store.

    1. Secure Financing.

    1. Sign Franchise Agreement.

    1. Take Training and supports

The application process for this American-brand is quite easy. Now, below are the step-by-step procedures to apply for a Subway franchise:-

    • Visit the official website for brief details related to its franchise https://www.subway.com/en-IN/

    • After you have read everything fill out this application form https://subapps1.subway.com/AdditionalInfoApp/index.aspx?LC=ENG

    • Make sure all the details are current and up to date

    • After all the details are given o not forget to click “send” at the bottom

    • If you are shortlisted a concerned team will contact you

Marketing support & advertisement assistance

Subway is a food brand that treats its franchise’s partner as a loyal partner and helps them completely to grow their business. Once You apply for the franchise, a Person from the Subway franchise head office will assist you in all possible ways like setting the store, marketing, and also in revenue generation.

Complete franchisee training along with field assistance will be available for all their franchises to keep their standard and quality in the top position.

Subway India franchise: contact details

    • Address: Subway Systems India Pvt Ltd.

    • B 11/1, Okhla Industrial Area, Phase II, New Delhi -110020

    • Telephone: 011 41754035, 011 41708082.

Is Subway Franchise Profitable?

The profit margin always depends on the location and customer demand in that area. If there are enough orders from your franchise then you can earn a profit of Rs 1-2 lakh per month. So, yes Subway franchise is a profitable business. The profit margin of opening a Subway franchise is 10%.

Subway Franchise Return on Investment

If the demand is high at your location then the profit margin could high up to 40-45%. You will be earning triple income at your location. Now, the average ROI is within 24-30 months, and not more than that.