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5 Tips for Franchisees From the Director of Subway

Hector came to Subway because of his entrepreneurial spirit, having worked in large global companies, including Quaker Oats, Kimberly-Clark and Pepsico, in the latter his departure in 2009 was imminent due to a major restructuring.

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Hector came to Subway because of his entrepreneurial spirit, having worked in large global companies, including Quaker Oats, Kimberly-Clark and Pepsico, in the latter his departure in 2009 was imminent due to a major restructuring.

“There I paused on the road and I remembered that I had wanted all my life to start a business of my own, but I was just sitting at my desk comfortably receiving my fortnight. It was time to act.”

Says Hector.

His departure from the company and the capital he had were the ingredients he needed to take the opportunity he had so much hoped for: investing in his own business. It was so he decided to venture to sail on Subway submarine sandwich.

He thought that one business was not enough, so he took two franchises: one digital marketing and one Subway branch. However, in the first it was very bad, not because of the model, but the digital issue had not yet matured in the country. “I crashed against the wall, inverted, failed and closed,” he recalls.

To his surprise, the restaurant was the one that started to grow. “I started taking love for the brand and got involved, with the background I had, in brand marketing committees. They invited me to be part of the National Advertising Board and that is where the opportunity to return to the corporate world arises, “he explains.

It was so that Héctor was offered to join the company as General Director, a position he held since February 6, 2017, and start with the project of the Subway office in Mexico. However, the entrepreneur left the rules clear on the table, before giving the yes: the possibility of maintaining their restaurants.

“You can not understand and develop a business model for entrepreneurs if you do not live it. The fact that as CEO you have units makes you more sensitive to your main clients (franchisees), “says the director.

Héctor Huerta not only holds the position of general manager of Subway in Mexico, but also has seven years of experience as a franchisee of two units of the same brand. “When you enter this business model you forget something fundamental: the franchise has a way of doing things, which has given success so far.”

With this time in the business, the experience has left him with great lessons that he shares today with all those who have or seek to invest in a franchise.

1. Believe in franchise models

This type of business has processes and products that are already proven, so sometimes, says Hector, the owner of the unit wants to make decisions that he considers most appropriate.

However, you must have flexibility to accept things, that perhaps for each person does not make sense and understand that you are buying a franchise model, which has rules of the game that must be played.

2. Be a leader

People believe that since the franchise is a proven model, they can only invest their money, hire two people, open the business and go on a trip. Like all business, for things to work, a head is needed that inspires, directs and is involved in the operation.

At Subway, when a person is interested in acquiring a unit, they must take a training course at the Miami regional office, in addition to completing 16 hours of online theory and practice training from Subway University. The final test is done in physical stores in order to have a complete picture of how the business works.

“I started doing everything: from the bread to the toilets, and so put the stick up. Preach by example, so that when your team sees you they will never say ‘you can not do it.”

3. Live the franchise

This advice is linked to the previous one. You must enter and know every detail of the franchise, know how and how far to ask your employees what needs to be done.

“When you know each process and operation of the business, you can get a lot of mileage.”

4. Reinvest in the business

Subway, like all franchises, charges royalties (around 12.5%: 8% for the right to use the brand and the remaining 4.5% for an advertising fund), but regardless of this amount, Héctor recommends reinvesting in the local market.

“Connect with the society that is around your business, that is the greatest learning: to make your business have a more human perception of the community where you live,” he says.

Support groups with promotions in events such as community parties, races, among others, is something that must be done in all franchises and in all businesses to generate loyalty. “That gives you a good image to talk about you with minimal actions,” he says.

5. Treat your people as a family, not as employees

The rotation generates expenses that impact more than investing in the human part. Investing in people is key in this type of business, since franchises are characterized by a high turnover of employees. “I make my employees earn above average, but I also make sure they have the right working conditions so that they feel happy when they are there,” explains the manager.

Some of the actions carried out by Hector are: delivering a bonus for birthdays; in important dates give them a detail as in Day of Kings, Day of the Candlemas; Place lockers for each employee. “Things that without being material count a lot for people,” he says.

This year Héctor visualizes for Subway a growth of 29% in Mexico compared to last year. This growth considers points such as marketing, innovation, technology and store relocation.

The franchises are a way to undertake with less risk, so in the future Hector plans to acquire his third branch, although that means more responsibilities and less time.

“To continue in this world means that you do not disconnect, and in turn you are more grounded instead of making desk plans”.

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