BUSINESS PLAN 19 19 BUSINESS PLAN Marketing Plan of Subway

Running head: BUSINESS PLAN
Marketing
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Table of Contents
1.0 Executive summary...................................................................................................................3
2.0 The Business Concept................................................................................................................3
2.1 Description of Subway and its USP.......................................................................................3
2.2 Goals and Potential of the Franchise.....................................................................................4
3.0 Research and Analysis...............................................................................................................5
3.1 Target Market and Needs.......................................................................................................5
3.2 Market Size and Trends.........................................................................................................5
3.3 SWOT Analysis.....................................................................................................................6
4.0 Marketing plan...........................................................................................................................7
4.1 Product...................................................................................................................................7
4.2 Pricing Strategy.....................................................................................................................7
4.3 Promotional Activities...........................................................................................................8
5.0 Management Design..................................................................................................................8
5.1 Personnel requirements and perceived gaps..........................................................................8
5.2 Legal Responsibilities and Obligations.................................................................................9
6.0 Financial Analysis...................................................................................................................10
6.1 Projection of Financial Statement........................................................................................10
6.1.1 Income Statement.........................................................................................................10
6.1.2 Cash Flow Statement....................................................................................................11
6.1.3 Balance Sheet................................................................................................................12
6.2 Break Even Analysis............................................................................................................13
7.0 Investment Proposal.................................................................................................................15
7.1 Capital requirement.............................................................................................................15
7.2 Expected Financial Return...................................................................................................16

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7.3 Total Capital required..........................................................................................................16
8.0 Critical Risks...........................................................................................................................17
8.1 Potential obstacles and risks................................................................................................17
8.2 Alternative courses of action...............................................................................................17
9.0 References................................................................................................................................18

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1.0 Executive summary
This report provides a detailed analysis of opening up a Subway franchise in Paya Lebar Quarter
(PLQ) Mall which will be opening in the fourth quarter of 2019. It is one of the most booming
locations for opening up a food chain as it will include 22,000 employees within seven minutes
of walking distance and other consumers visiting the mall. Therefore, it is one of the most
attractive places to open up a mall. Subway has been chosen as the brand for franchising as the
brand is known for their commitment towards healthier food options and fresh ingredients. The
unique selling proposition of the company is eating fresh which implies that company wants to
deliver fresh food to the consumers.
The main goal of the business plan is to propose the viability of investment in franchising
Subway and the report has been pitched to Angel Investors. The target consumers of Subway
will consist of population between the age of 18-39 having moderate to high disposable income
and willing to leave a healthy lifestyle by developing healthy food habits. The company also
target kids and will use the same menu for kids widely popular in other countries. The love for
fast food in Singapore is still high where McDonalds have 135 outlets, KFC has 86 outlets,
Burger King has 50 outlets, Texas Chicken has 15 outlets and Long John Silver has 25 outlets.
As per the market share in the industry, McDonalds have 40% share in the market followed by
KFC with 13%. Therefore, the company aims to compete with these major players to develop a
market share of 15% and achieving return on investment of 15%. The proposed plan is expected
to fulfil the chosen target.
The financial forecast of the business plan shows that the company would realise their break-
even point within the first 3 years of operation and requires a capital of 0.5 million to develop a
franchising model in Paya Lebar Quarter (PLQ) Mall.
2.0 The Business Concept
2.1 Description of Subway and its USP
Subway is an American restaurant chain franchise which sells salads and submarine
sandwiches to their consumers. It is one of the largest single brand chain of restaurant and the
largest operator in the global market. The majority of the franchises are in the United States but
has entered into various markets. It is one of the cheapest fast food chain for franchising as it

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requires liquid asset of $30,000 and net worth of ranging within $80,000 to $300,000 (Peterson,
2015). It implies the cost of opening up a Subway Franchise is quite less compared to other
restaurant chain. The brand is known for their commitment towards healthier food options and
fresh ingredients (Peterson, 2015). The company has been working diligently to improve the
sustainability of operations and products at Subway. Therefore, the brand is on their journey to
make their operation socially and environmentally responsible to improve the health of the
consumers.
Subway has their unique selling proposition of eat fresh to entice the consumers to
purchase their sandwiches as it is appealing towards people’s desire of eating the best quality
food. It helps in differentiating their products from that of the consumers (Alberts, 2015). The
company wants to stand out in the market by stating that they provide products as no other
sandwich chain makes claims of delivering fresh products to their consumers. The logo has
incorporated bright colours which means that people will lead a fresh life when there are eating
fresh (Alberts, 2015). Simplicity is the key to the effectiveness of their unique selling proposition
where they display their USP to grab attention of the consumers.
2.2 Goals and Potential of the Franchise
Subway are trying to open a franchise in Paya Lebar Quarter (PLQ) Mall where the
organisation has developed set goals for their franchise and they are as follows:
 To reach the break-even point and start earning within the first two years of operation
 To achieve a return on investment of 20% within the first two years
 To increase the market share of Subway by 15% within the first three years
 To increase brand awareness on the social media platform to reach million followers in
Singapore
 To perform 10 event in the first year to emphasise and promote the concept of fresh and
healthy eating among the consumers
 To expand franchise to increase capacity of accommodation in Paya Lebar Quarter (PLQ)
Mall

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3.0 Research and Analysis
3.1 Target Market and Needs
The target segment of Subway consists of group of consumers having similar needs and
have been identified based on the geographic, demographic, psychographic and behavioural
segmentation. In terms of geographic segmentation, the company upholds their core menu and
will provide the similar menu they serve in America but they will increase the option of sauces.
In terms of demographic segmentation, Subway targets kids and adults between the age group of
18-39 years. The kids menu is more nutritious and provides juices instead of carbonated drinks.
The company offers low fat menu to these consumers as majority of the consumers having
fitness goals belong to this segment. In terms of psychographic segmentation, the company will
attract the consumers practicing a healthy lifestyle and want to have a healthy meal. As per the
chosen target consumers, the quality and safety of the food is a priority.
Therefore, the target consumers of Subway will consist of population between the age of
18-39 having moderate to high disposable income and willing to leave a healthy lifestyle by
developing healthy food habits. The company also target kids and will use the same menu for
kids widely popular in other countries.
3.2 Market Size and Trends
The fast food industry is highly booming in Singapore where the industry generated more
than S$1 billion in terms of operating receipts in the year of 2016. The insatiable appetite for fast
food among the population in Singapore has helped the growth of the food and beverage sector.
Even though the data from the past two decades show that there has been 10% decline in the
overall food and beverage sector, the fast food sector has grown by 29% during this period (Lim
& Wei, 2019). It is similar to the phenomenon in United States where due to the oversaturation
of the market and increase in labour cost is affecting many chains of restaurants. The increase in
health consciousness among the population is also affecting the chains. However, the love for
fast food in Singapore is still high where McDonalds have 135 outlets, KFC has 86 outlets,
Burger King has 50 outlets, Texas Chicken has 15 outlets and Long John Silver has 25 outlets.
As per the market share in the industry, McDonalds have 40% share in the market followed by
KFC with 13%. Burger King has 4% share and Long John Silver has 2% share in the market
(Lim & Wei, 2019). It shows that healthy eating movement is not prevalent in Singapore and it is