A FRANCHISEE’S DILEMMA
GM591
December 12, 2010

Introduction The franchise restaurant sector in the business market is a huge part of our economy. Names like KFC, Taco Bell, McDonald’s, Burger King and Pizza Hut are very common in people’s everyday lives. One of the most popular and fastest growing businesses in this area amongst the names mentioned above is the Subway restaurant franchise. Subway is the world's largest submarine sandwich restaurant chain with more than 34,000 locations around the world. Subway started out as a typical business venture by its owner, Fred DeLuca, who was motivated to find a way to pay his college tuition so he could become a medical doctor. Fred took a loan of $1,000 from a friend, Dr. Peter Buck, and offered him to become a business partner in opening a submarine sandwich shop. The first store they opened was called “Pete’s Super Submarines” in Bridgeport, Connecticut in August, 1965 ("History," 2010). Subway has become the leading choice for people seeking quick, nutritious meals that the whole family can enjoy. As they continue to grow, they are guided by their passion for delighting customers by serving fresh, delicious, made-to-order sandwiches while maintaining a standard of food products and brand that is recognized globally. Subway is a registered trademark of Doctor’s Associates Inc. (DAI). DAI is the owner of the business concept and the trademark of Subway Restaurants. DAI is a privately owned company that is located in Milford, Connecticut. The corporate headquarters employs more than 600 people to run their main office location to serve the franchisees and operate the corporation. “Subway’s mission is to provide the tools and knowledge to allow entrepreneurs to successfully compete in the QSR industry worldwide by consistently offering value to consumers through providing great-tasting food that is good for