17 y.o. kid borrows $1,000, grows $5.7B company

[Mrs. BRKb]

Start Small Finish Big:
Fifteen Key Lessons to Start - and Run - Your Own Successful Business
by Fred DeLuca, John P. Hayes


This is the story of Subway (as started by young Fred DeLuca and family friend Dr. Pete Buck), and includes the back-stories of numerous other name-brand businesses.

It's a good book for anyone curious about
~ Subway and Subway franchise
~ How to start a business
~ How to scale a business
~ What a mentor might tell you about how s/he did it (many start-up are stories recounted)

Q. How did this begin?
A. It began as a project to pay Fred's upcoming college expenses by opening a sub shop/s. Neither of the partners had any experience in this industry (to the point that Fred made his first sub after they opened the doors, and the first customer ordered).

Q. How did they learn the business?
A. They looked at what was working:
~ Mike's* (had 32 sandwich stores)
~ Amato's (had good Italian deli subs)


Starting Out

First store, opened 1965.

Their growth goal: To own 32 stores (*If Mike's could do it, why couldn't they?!).

Learn Along the Way

1967. Two years after opening the first store, young DeLuca's car broke down. He decided to hitchhike. A fellow around Fred's age of 19+/-, picked him up.

The driver didn't know Fred DeLuca from Adam, or that he had any interest or ownership in sandwich shops. The driver pointed out one of Fred's stores on the road. As he talked, the driver gave hitchhiker Fred great info about a major system weakness and floor plan flaw. He said:

"That's a great place to eat... they make terrific sandwiches. And all the soda you want is free... You go in with a friend, and order your sandwiches. Then, when the guy behind the counter turns his back to make the sandwiches, your buddy opens the cooler, and takes a case of soda and sneaks out with it. Nothing to it."​

Well, THAT explained why his store's beverage costs were so high!


Build an Identity

First use of SUBWAY® happened in 1968.

Scale It

First franchise, 1974.



Have a Vision

In the 1980s they had 200 stores.

Their new goal after analyzing markets and industry trends: to grow to 5,000 stores by 1994.

When you start, you don't know if you can accomplish the goal, but because you have a goal you're able to work toward it. At times you'll move ahead of schedule and ocassionally you'll fall behind schedule. The important point is that you stay focused on your goal and continue to move toward it.
- Fred DeLuca​

They failed to have 5,000 stores in 1994. But it wasn't bad news. They had 8,000 stores!



You've come a long way, Baby!

Subway now has over 40,000 locations in 105 countries.

Note: The book was published at the turn of the century, so not the newest, but the lessons conveyed have a timeless quality.

Few lessons are more important than Attract New Customers Every Day because customers are your business. They're truly your only asset as a business owner. Management professor Peter Drucker says that a business has but one purpose: to create a customer. The value of your business is directly proportionate to the number of customers you capture and keep.
- Fred DeLuca​

 

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[CarrieW]

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[Mrs. BRKb]

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[CarrieW]

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