Subway has announced two international master franchise agreements, one in Thailand and one in the State of Kuwait, according to a press release. In Thailand, About Passion Co. Ltd. inked a deal for more than 700 restaurants across Thailand. About Passion Co. Ltd. is an existing Subway multi-unit franchisee and leading food and beverage retailer in Thailand. "Today's announcement is a significant step towards growing our Asia Pacific business," John Chidsey, chief executive officer of Subway, said in the release. "We have seen a strong demand for Subway across Thailand and, with About Passion Co. Ltd.'s existing knowledge of our business model and success in implementing operational excellence across their current restaurant locations, we are confident they will be successful in strategically expanding our presence in the country." "We have seen enormous success in our Subway restaurants throughout Bangkok and are committed to continuing to build profitable and sustainable growth and inspiring brand love amongst Thai consumers," Thanakorn Thanawarith, founder and director of About Passion Co. Ltd., said in the release. "As guests across Thailand increasingly seek better-for-you, convenient and affordable food options, we're confident Subway will be a welcome and distinct alternative to the QSR brands traditionally offered in the region. We thank Subway for trusting and choosing About Passion Co. Ltd. as part of the brand's success in Thailand." In the State of Kuwait, Kout Food Group (KFG) signed a deal with Subway to open an undisclosed number of Subway stores. "The agreement with KFG is another important milestone on Subway's international expansion journey," Chidsey said. "As a large-scale operator with regional expertise and a proven track record of scaling operations to meet guest demand, KFG is an ideal partner for Subway as the company grows its global footprint." "We believe KFG's best-in-class operations paired with Subway and its commitment to relentless evolution when it comes to food, guest experience and digital offerings position this partnership for unparalleled growth in Kuwait's dynamic market," Amin Mohamed, CEO of Kout Food Group, said in the release. "We are looking forward to embarking on this journey with Subway and growing the business together." Subway operates more than 37,000 shops across more than 100 countries.

Dubai: Subway, the quick-service F&B brand, has wiped the slate clean and come up with a brand new business model for its UAE operations. Known for its sandwich variations and toppings, Subway has decided to employ a master-franchise – the Kamal Osman Jamjoom (KOJ) Group – instead of the multiple franchisees that were handling the UAE network. The move will allow Subway enough room to return to high growth ways in this market. In the recent past, according to market sources, Subway had seen the closure of some high-street locations even as its in-mall outlets continued to do well. For KOJ Group, a Saudi entity with multiple retail brands, this is its first step into F&B. “The Group had the desire to open a F&B division for some time, but we were waiting for the right partner,” said Hisham Al Amoudi, Group CEO of KOJ, to ‘Gulf News’. “Historically, Subway had a unique model for the UAE in which multiple franchisees owned and operated the restaurants. “KOJ is the first exclusive master-franchisee in the UAE - and one of the first few globally. KOJ has brand and development responsibility for all existing UAE sub-franchises, which remain under their existing ownership, as well as any new restaurants which would be owned and operated by KOJ directly. “Standard industry practice in the UAE is for quick-service restaurant brands to be operated by one master-franchisee. This allows for the implementation of one shared vision across the board, with all stakeholders operating as one voice in the marketplace.” For Kamal Osman Jamjoom Group, the F&B space might be a new one, but it can still make use of the extensive experience from handling consumer brands and concepts such The Body Shop, Early Learning Centre and Lego. Even then, getting into F&B for the first time takes some doing, especially after the changes the category had been subjected to from the COVID-19 spread. Al Amoudi shrugs off such concerns getting in the way for his plans with Subway. “The new operating model will help us be more consistent with our brand, provide a better experience for guests and be more profitable as we accelerate Subway’s growth in the UAE,” he said. Will it mean more outlets/sub-franchises might be closed? The CEO did not provide a clear blueprint, but did say: “Opportunities for consolidation will be entertained, as long as they are in line with Subway’s global strategy and in the interest of all parties working towards this strategy,” he added. “The exciting thing about Subway in the region is that there is a lot of room to grow. Subway is focused on ensuring we have the right restaurants in the right locations. “The goal is to deliver excellent guest experience, while maximizing franchisee profitability.”

Thanks to a “multi-million-dollar” grant program, Subway is about to ignite its remodel efforts, the company announced Thursday. The sandwich giant is providing north of $100 million to franchisees to speed up the program. As it noted earlier in the year, Subway is partnerning with vendors to provide $10,000 grants to operators, about a quarter of the remodel costs, to fuel the Fresh Forward and less expensive Fresh Start rollouts. Subway put a store-count target on the program Thursday. It now expects to refresh 10,500 U.S. locations by the end of 2020, it said. To date, 1,400 or so global units have been remodeled and 900 are underway. “Our franchise owners and their staffs work hard every day to deliver a great Subway experience for their guests,” Don Fertman, Subway’s chief development officer, said in a statement. “By signing up for the remodel program, the franchise owners are making an investment, and showing their trust in the brand. Together, with all that is going on with our global transformation, I’m convinced we are taking this brand to an exciting new level.” Subway in the midst of a multi-year, global transformation keyed on three goals: updated, modern restaurant redesigns; menu innovation; and better convenience and customer service elements. Thursday’s push follows an $80 million investment Subway made last year to emphasize new flavors and foster a more personalized guest experience with its “Fresh Now” platform. Free to franchise owners, the culinary-focused update has rolled to 14 countries, including France, Brazil, Singapore, and Australia so far. It encourages customization with new sauces, toppings, and beverage options. This includes Flavor Stations, Beverage Stations, with offerings like Tropical Strawberry Lemonade and Pomegranate Limeade. Subway said Fresh Now would be live in all eligible U.S. units this summer. Unlike the broader Fresh Forward remodel program, Fresh Now, which also brought new employee uniforms and menuboards into restaurants, focuses heavy on food choices over décor. Note: The 1,000 from 2018 is not an exact figure. But Fresh Forward is where the needle is moving. The updated package, complete with a fresh vegetable display case, bold “S” choice mark logo, bright color palette, digital menu boards, and kiosks in some stores, is mandatory on all new openings. However, Subway’s unit count has been retracting in recent years, not growing. After reducing its U.S. count by 866 restaurants from 2016–2017, Subway dipped below 25,000 in the U.S. this year, the company said in January. That's roughly a 1,000-store drop from the 25,908 Subway closed 2017 with. A LOOK BACK: Step inside Subway's bold new Fresh Forward design. Subway’s “optimization plan” centers on relocations, remodels, and an effort to rework the system to create a fleet of fewer, but more profitable, restaurants. Prior to the 866-store decline from 2016–2017, Subway added 4,456 locations the previous six years combined. At the end of 2017, Subway had US. Systemwide sales of $10.8 billion and average-unit volumes of $416,000. AUVs were $422,000 the year before and sales were $11.3 billion. There’s no secret why Subway is in a hurry to accelerate remodels. In September 2018, the company’s Fresh Forward design was in 465 locations. And the results compared to legacy units were stark. Subway at the time sampled a collection of Fresh Forward U.S. stores and juxtaposed them with old ones. Gross profit was up 11 percent. Traffic lifted more than 8 percent. In those Fresh Forward designs at relocated restaurants versus remodels, Subway saw an even steeper hike in sales and traffic—about 18 percent and 15 percent, respectively. SUBWAY Subway's Fresh Forward redesign package has resulted in positive lift at stores so far. Over the course of the first year, Subway managed to cut the costs of the redesign in half, it said. The company also introduced the Fresh Start tier, which ran another 50 percent less, in an effort to open the platform to operators at all levels. The Fresh Start model was designed specifically for remodeled locations. It takes the critical elements of the update, like the color refresh, logo and furniture, and makes it available at a significantly lower cost. Beyond just the ROI of updated units, Subway said, it wants to refresh locations to reflect other changes in its trajectory. A brighter, more innovative look supports how Subway is evolving and wants to be seen by a new wave of customers. It offers synergy with some other innovation-forward messages touted by the brand. At old units, an outdated look and fresh message simply didn’t mix. “The whole Fresh Forward décor, from the bright green and fresh elements, it all signals to consumers that there’s something new going on at Subway,” Tracy Steinwand, Subway’s VP of field performance, told QSR earlier. One example being the fresh vegetable display case installed behind the sandwich line. Five decades of slicing vegetables in-house didn’t resonate until customers could see it. Matthew Mabel, president of consultancy Surrender Inc., said Subway long rode its standing as a healthier alternative in quick service. That worked well for years until competitors began introducing their own health-forward options and upstart fast casuals built entire businesses around the positioning. Meanwhile, Subway became far from the only premium sandwich game in town. “I think they’re going to have to continue to refocus the brand, the look, the logo, the feel as they look forward to getting back to the dominant player they have been historically,” Mabel told QSR. “Their competitors have picked off their guests in the segment and now they’ve got to get them back. They’ve got to convert those longtime Subway guests that have left.” All of this provides a sense of urgency for Subway, which explains the grant program. “Franchising works best when franchise brands and franchise business owners succeed together,” said Stephen Worley, senior director of communications for the International Franchise Association, in a statement. “IFA commends Subway for their efforts to facilitate these renovations, which can benefit franchise owners, their employees, and their customers alike.” SUBWAY Subway's new King’s Hawaiian test is one of many menu innovations lately. In addition to the look, Subway has been far more active on the menu front than usual lately. It’s introduced Ultimate Cheesy Garlic Bread, pulsed LTOs into its Signature Wrap lineup, and piloted King’s Hawaiian bread at select restaurants. Recently, the brand launched a Ciabatta Collection and Hubert’s Lemonade and is testing Halo Top Milkshakes at 1,000 restaurants. Subway is also leaning on its partnership with Tastemade, a food media brand known for its social media prowess. Tastemade touts sophisticated data about how consumers interact with food and how food connects to the wider culture. Such insights served as inspiration for the Green Goddess Tuna Melt, an LTO once available in 3,000 restaurants that combined Subway’s classic tuna offering with green goddess dressing, a popular ingredient frequently featured in online recipes. Subway is pushing new menu items out across the globe, including paninis in New Zealand and Signature Wraps in the Middle East, the company said. But moving forward, Subway will maintain its everyday value options. Mabel added that Subway should be wary of moving up and down price points simultaneously, though. “They need to pick one,” he said. Still, the brand seems to be headed in the right direction by broadening its appeal. Fertman told QSR earlier that Subway worked on strengthening its relationship with franchisees, many of whom expressed frustration over the thin profit margins associated with the famed $5 footlongs promotion. He said Subway moved away from discounting core sandwiches in favor of launching more options and innovations across a wide variety of price points. That’s a pretty profound change in Subway’s go-to-market strategy, Fertman said. Len van Popering, promoted to Subway’s chief brand and innovation officer in May, added that Subway wanted to find a way to balance its classics with bolder flavors and new experiences. The chain updated digital properties as well. Subway’s MyWay Rewards program, announced last February, was built on the premise of a more customized experience wherein users can earn and redeem tokens in a variety of ways. The program is integrated into the new version of the app. Subway launched delivery at 9,000 restaurants in October. The massive push involved partnering with UberEats, GrubHub, DoorDash, and Postmates. Earlier in the year, Subway said its app was enjoying year-over-year growth of 100 percent in users following a May 2018 redesign. Subway made some other executive changes when Van Popering was promoted. Marie Silloway was named vice president of brand management; Renee Hourigan director of convenience innovation; and Ciaran Duffy senior corporate executive chef. Silloway previously worked as chief brand equity and customer experience officer for Godiva, VP of marketing and category for Starbucks China, and SVP of Estee Lauder. Subway said she’ll guide “the brand’s center of design excellence, global packaging functions, and convenience strategies.” Hourigan most recently served as VP of marketing at Victorinox Swiss Army. Hourigan’s duties will include building Subway’s delivery platform, among other initiatives.

This past weekend, sandwich lovers and franchise industry folks alike were struck by a report from the New York Times that described how the structure of sandwich franchise Subway allows franchisees with authority to target others for closure or takeover. It’s a fascinating read about a dangerous culture of conflict of interest that helped a restaurant chain become the largest franchise in the world. Aside from the suggested flaws in its management system, there is another area of Subway’s protocol that is also a potential stumbling block, namely its opacity when talking about its financials. According to the Times’ report, the company’s franchise disclosure document, or FDD—a document every franchise must produce, containing company information and a franchise contract—is more than 600 pages long and gives Subway license to change its rules whenever it sees fit. When I inspected the company's most recent FDD, I found that it offers virtually no data on how much money a person might be able to make should they buy a Subway franchise. Financial data will only be provided for a specific location to a prospective buyer contemplating buying that location.* It also notes that Subway does not authorize employees or representatives to talk about how much money can or can’t be made by owning a Subway restaurant, orally or in writing. **Subway spokesperson Kevin Kane told Forbes that prospective franchisees do have an avenue to learn about the financial returns of Subway restaurants by "reaching out to existing owners to learn about their experience operating a Subway restaurant. Existing owners may elect to share financial information for their restaurant." Subway is a private firm and not legally under any obligation to go to great lengths to pull the curtain back on its financials. But in its secrecy it has fallen out of step with other franchises in the industry that have increased the amount of data they provide prospective franchisees. The result is that potential franchisees come to trust these more transparent brands, and that makes them more likely to buy in. Studies Show Subway Is On The Wrong Side Of Trends A study of 1,905 franchise systems by franchise industry intel firm Franchise Grade discovered that between the years 2010 and 2016 the 870 systems that did not disclose financial performance information in their FDDs saw their number of locations reduce by 0.2%. The 652 franchise systems that did provide financial details experienced an increase of more than 13%. There were also 383 franchisors that provided some metric of expense data—like gross margins or earnings—and those systems grew their location counts by 18.4% during those six years. The correlation between financial disclosures and growth has not gone unnoticed by franchisors, and brands have become more transparent to appear more trustworthy to investors. According to a 2017 report from industry market research firm FRANdata, looking at 3,000 different brands, the number of franchisors that included detailed financial info in their FDDs grew by 52% between 2014 and 2016. The report also found that a vast majority of franchisees (92%) say that having this data makes them feel more informed and better able to decide whether to invest in a brand. When Forbes compiled its list of Best & Worst Franchises To Buy, 2019, we discovered that the top brands all provided detailed financial information that would allow franchisees a picture of how much money they might make if they buy in. Easier On The Franchisee Then there is the impact transparency has on the ability of a franchisee to borrow money to invest in starting up a franchise location. FRANdata’s report found that 97% of lenders are more likely to provide capital for franchisees to invest in a franchise if that brand discloses financial performance information. The reason is that transparency and positive numbers comprise about 20% of a lender’s assessment of whether a brand is a risky investment. Low-risk franchises allow franchisees to secure fixed-rate financing and lower equity payments. If Subway’s financial disclosures are considered insufficient by prospective franchisees, it’s very possible that it is shooting itself in the toe in terms of system growth. That’s not a small matter for a brand that’s shrunk by more than 2,300 locations over the past three years in the U.S. alone. Franchisees want to invest in systems they feel they can trust, and transparency is the best path to building that trust between brand and potential investor. Subway may have to change in order to build that kind of trust, especially in the wake of this weekend’s revelations. *sentence added 1:58 p.m. 7/2/2019 **sentence added 10:01 p.m. 7/2/2019

كرّمت «صب واي»، أكبر سلسلة مطاعم في العالم من حيث عدد الفروع، وكيل تطوير أعمالها في الكويت عبد الرحمن المطيري بمنحه جائزتي «وكيل التطوير للعام» و«صاحب الامتياز متعدد الوحدات للعام»، وذلك خلال مؤتمر أقيم أخيرا في سان فرانسيسكو بحضور وكلاء التطوير من جميع أنحاء العالم. ونال المطيري لقب «وكيل التطوير للعام» تقديراً لإنجازاته الملفتة في تطوير العلامة التجارية «صب واي» في الكويت، ونجاحه في الامتثال التام لنظام امتيازات «صب واي». وأما جائزة «صاحب امتياز العام»، فقد استحقها بعد نجاحه في بناء شبكة مبيعات واسعة كان لها الفضل في زيادة الربحية، تزامناً مع تحقيق مراتب متقدمة في عملية تقييم منافذ البيع. وتم اختيار عبد الرحمن من بين أكثر من 4000 من أصحاب امتيازات «صب واي» حول العالم. وكان المطيري، الذي ولد ونشأ في الكويت، قد اكتشف علامة «صب واي» للمرة الأولى حينما كان يدرس بجامعة تكساس حيث أصبح آنذاك زبوناً دائماً لديهم. ولدى عودته الى بلده، بدأ المطيري يفكر بتأسيس عمل خاص به، ما جعله يقوم بدور رئيسي في إعادة إطلاق مفهوم «صب واي» في الكويت عام 2001، بعد غيابها لفترة قصيرة عن الدولة. وقال المطيري لدى تسلمه الجائزة: «إنه لإنجاز كبير بالنسبة لي. فمن الرائع أن يتم تكريم العمل الجاد والحرفية العالية التي حرصنا عليها على مرّ السنين في تعاملنا مع الموظفين والعملاء والزملاء». وأضاف: «لقد قررت أن افتتح مطعماً لـصب واي في الكويت منذ أن كنت أحد الزبائن الذين لطالما استمتعوا بوجباتها الشهية. لقد آمنت بهذه العلامة التجارية، وكنت على ثقة كبيرة بنجاحها». ويمتلك عبد الرحمن المطيري ويدير حالياً 47 مطعماً لـ«صب واي» في الكويت، يعمل فيها نحو 600 شخص، إضافة إلى كونه من المشاركين الدائمين في الأنشطة المجتمعية والخيرية، كما يخطط لافتتاح 10 مطاعم جديدة بنهاية العام الحالي، وإضافة 50 فرعاً إضافياً خلال السنوات الخمس المقبلة. وتضم شبكة «صب واي» أكثر من 35 ألف فرع في 98 دولة، بما فيها أكثر من 320 فرع في الشرق الأوسط. وحازت علامة «صب واي» على المرتبة الأولى في استطلاع مجلة «إنتربرونور» لعام 2010 حول «أفضل امتياز سنوي 500» ضمن فئة «أفضل فرصة امتياز تجاري» وهو إنجاز حققته 17 مرة خلال الثلاثة وعشرين عاماً الماضية.