Fast Food and Subway

2159 WordsOct 31, 20119 Pages
Executive summary As China's market opening, Chinese fast-food industry is concerned increasingly by foreign businesses. Subway is one of the earlier merchants use franchising way to enter into the Chinese market. Although the Chinese market is huge and full of potential, it also needs to face many threats. Intellectual property issues pose a big threat to the franchising of Subway. China's IPR legal system is not complete. So that Subway should cooperate with the Government, and then have more self-enhance protection of intellectual property. Subway franchising has its own advantage and disadvantage, but I still think it is most suitable business way for Subway in China. Its advantage is better to save money and save time, and it is…show more content…
At first, when a brand chooses to enter a new market, most of the merchants would choose to open a single or minority shop to begin the business. However, it is difficult to bend into the market and give the customer a deep impression. But franchising solves the problem of it. When Subway recruits a batch of franchisees, it can help them begin the business in the meantime, so that it quickly forms the economies of scale and expansion. It is not only save the time, but also have a big impact on the market. Now, more and more people know the Subway and have a high identification though promotion. Secondly, franchising helps Subway achieve standardization. It requires central purchasing that it is effective to control the unity of products’ quality and price and save the cost of decision. What is more, it offers a standard training for the stuffs. At ordinary times, we all can see every Subway sell the same sandwiches, have same ads and same requirement of stuffs. In addition, franchising is help the Subway enter into Chinese market with minimal entry costs. Because the local franchisees will help assume many cost and responsibility for the Subway. Like the cost of decoration and the advertising. At last, franchising allows the focal firm to avoid trade barriers associated with exporting and FDI,
Open Document