World of Franchising - SUBWAY & NAASF

A discussion of issues affecting franchisee operators in the Subway franchise system and how the system may be improved. If you have any comments and wish to contribute to this web page; feel free to email the author.

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Location: Canada

My background is in Research and Development (Science) as well as Economic Development (Business). Currently managing my own businesses. My degree; B.Comm, Finance Major.

Wednesday, June 16, 2004

One of my concerns regarding NAASF and DAI has been the apparent opinion that we can work together as a team to build the brand and improve the operational relations with DAI and the franchisee. Time and again we see that DAI will do what they want and just seem to play NAASF with appearance of inclusion in decision making.

In the latest Newswire (Vol. 2, No. 21 - you can view these by linking the the NAASF web site) we are given a glimpse at the process which happens all the time: "During the past several years, [italics added] your NAASF has worked with DAI to develop a process to assure that, as we grow the brand, we do not overdevelop in specific markets..." "However, NAASF's basic goals have not yet been met."

Even the basic goals which NAASF set were not met after several years of discussion! In reading some of the links on this web site you can get a pretty good idea of the character of the person who controls Subway. That we continue to think that such a person will voluntarily give up control is not born out by the evidence.

The major investor in Subway is the franchisee not DAI. It is time that we take some control of the situation. By just talking we will not make any significant inroads. We do have some power to influence the process. One is to enter into a test case against DAI. Encroachment would be a very good test. Why is NAASF so reluctant to support the franchisee on this issue?

One of the solutions that NAASF has latched on to is the need for DAI to hire a CEO. How does NAASF think that this will change the culture at DAI? In all my knowledge of corporations the CEO reports to the owners and not the staff. Any CEO worth his money will know who writes his paycheck and it is not the franchisee!

I came across an article which supports my opinions regarding the corporate structure in North America (why else would I refer to it :-)). You may find it interesting. I have provide a direct link for you. The article appears in the June issue of Wired Magazine, 12.06, June. For the busy or the lazy; the article basically says that the group does a much better job of predicting than the individual. It goes on to suggest that the operation's employees should be used much more in making corporate decisions and less emphasis should be placed upon the decision of the CEO!

On this note; we really need to get back to basics where the franchisee takes control of the operation. We will make better decisions than DAI with or without a CEO.

Link here to the Wired article.


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