Subway

665 Words Mar 14th, 2014 3 Pages
Subway case study | Subway and the challenges of franchising in China | | ADVANTAGES AND BEST ENTRY STRATEGY OF SUBWAY | | |

SUBWAY AND THE CHALLENGES OF FRANCHISHING IN CHINA

Question: - What are the advantages of franchising in China from Jim Bryant’s perspective? From Subways perspective, is franchising the best entry strategy for China and why?

Answer: - “Subway is a very big firm and to spread its business with franchises. To enter in China it was the best way. It is the best way of licensing and entry in a new country. In this company has given a trademark fro their promotion and training.” (International Business Environment and operations 11th Edition, 2009). 1. Entry with franchisee system:- Before
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They have same ads and similar requirement of stuffs. But because of all these things it was able to enlarge their branches very fast in China. It was able to open 140 branches in whole china from 1995 to 2011. In this given figure, we can see that the total restaurants in last 5 years the Subway grow very fast than McDonald’s in china. It starts from 31,000 which was less than McDonald’s and it almost hit the 39,000 at the fifth year which is almost the gap of more than 5000. So, now we can say that the subway is very fast growing restaurant in China then others.

Source:- Who is McDonald’s biggest threat? Cahill B. (2013)

The best way for the Subway to enter in China market was franchising. Subway can also use FDI. It is the best way to control and have a link with other headquarters. It is the best way to manage the business, but it takes so much time to do research and make the decision and all. It also needs so much money to provide the facilities. So, in the comparing with the other way to enter in other countries the best way to is the franchise and it is the best way for a fast food industry to enter in a new market and enlarge their branches very fast.

Reference:-
Deniels J (2009) “International Business Environment and Operations” 11th Edition, China machine Press, 2009p. 430 published on 25 Nov., 2010.
Cavasgil, S., Knight, G. And Riesen berger, J.R.(2012), International Business: the new Realities. 2nd ed. New Jersey: perarson, PP. 482 –

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