Sammy Success: What It Takes to Build and Operate a Profitable Sandwich Chain

Photo by Jacob Lund Photography

Subway is not only the most successful sandwich brand in the world. It’s one of the world’s biggest fast food chains—up there with McDonald’s, KFC, and Starbucks—and recently explored the possibility of a sale that valued the chain at $10 billion.

Sandwich shop owners the world over must see that figure and wonder how they can get a slice.

Given how much hard work, time, and patience it takes to run just one successful sandwich shop, how could you expand into a profitable chain?

We’ve looked at what makes a sandwich chain successful, and identified the ingredients and structure for success—everything you need to build and operate a profitable sandwich chain. 

Keep reading to discover:

• The four fundamentals on which to build your success
• Practical tips for growing and scaling into a chain without losing quality and consistency
• The sandwich shop technology that will help you optimize operations for long-term success

By the last crumb, you’ll have everything you need to start building your sandwich shop into a successful chain that can scale without compromising quality.

What Are the Ingredients for Success?

To turn your shop into a successful chain you first need to have rock-solid operational processes and a good understanding of your numbers to ensure your shops are profitable. 

You need to create a great culture and hire teams that can carry out your processes consistently – and keep your staff happy and engaged. 

Finally, you need to be able to market your new shops to build a solid customer base in each new location.

Let’s examine each element in a little more detail and talk about how to achieve these outcomes.

Operational Efficiency

Sandwich shop profit margins are being attacked from all sides. Ingredient and energy costs are up, and rents are rising. 

You need rock-solid operational processes to maintain a decent margin, which means you need to be on top of every aspect of operations, from inventory management and portion control  to cleaning and food hygiene. 

Inventory Tracking

When you’re operating across multiple locations, small errors become big problems. Software that automatically tracks inventory and automates many of your purchasing processes allows you to keep accurate inventory records at scale. 

Ingredient Prep 

Tight control over portion sizes is essential to keep food costs under control, especially when you’re dealing with higher-priced ingredients. 

There’s a reason Subway weighs out the most expensive fillings in pre-prepared portions. It gives them certainty over the actual cost of these ingredients in each sandwich. 

Keep tight control on portion sizes for your higher-priced ingredients, which are likely to be your meat and fish fillings, homemade sauces, and cheeses. 

You can be more generous with your cheaper salad ingredients, but you should still know how much of each ingredient goes into each sandwich so you can calculate your food costs. 

Sandwich Assembly

Sandwiches are quick-prep food so if you’re assembling them to order, people don’t want to wait. At the same time, you don’t want to rush customers. 

The way you optimize your assembly process will depend on the type of shop you run. Here are the most common setups and how to optimize them for speed and customer satisfaction:

• Assembly Line – prepare all your ingredients and pre-portion the most expensive fillings. This setup is about speed and customization so make sure you have everything prepared so that customers can choose their fillings and you keep the line moving.
• Ticket System – here, customers choose a sandwich from the menu and get a ticket, then collect the sandwich when it’s ready. This system means you have dedicated order-takers and sandwich-makers so if one section falls behind, staff can jump in and help out to keep the orders flowing.
• Pre-made Sandwiches – if you’re making sandwiches in advance and selling them cold or heating to order, the key is to accurately predict demand. Looking at your previous sales figures can help you determine how many sandwiches to make in advance. Plus, you can have a team member making more during the day to meet demand. Partner with a charity that collects excess food so that nothing is wasted at the end of the day if you do overshoot.

Find your balance between speed and customer service, and then set the workflow so it can be replicated across locations by new teams.

Cleaning and Food Safety

Staying on top of cleaning schedules at one shop is challenging enough, but making sure standards are high across locations requires more formal processes and procedures.

Digital checklists are ideal for maintaining consistency and ensuring compliance with health and safety regulations. Here are some examples of checklists that help you maintain consistent standards:

• Opening checklists: setting up the shop and checking the toilets are stocked with paper towels and toilet roll
• Food safety and prep: check expiry dates, prepare fillings, and check any deliveries
• Temperature logs: refrigerator temperatures and safe cooking temperatures
• Closing checklists: closing the till, cleaning, and security checks

Food safety software can help you oversee food safety at multiple locations. The best tools typically include digital checklists to keep staff engaged and accountable and allow you can compare the performance of different locations from a central dashboard.

Omnichannel Ordering

Sandwich orders are complex, with many customizations and modifiers, from dozens of interchangeable fixings to different kinds of bread, to drinks and side orders.

This means your ordering system needs to handle complexity on multiple channels—in-store, online, mobile app, and third-party marketplace orders—while providing a smooth and error-free experience for your customers.

The only way to achieve this multi-channel consistency is with the latest omnichannel ordering technology. Today’s tech assimilates orders from every channel and sends them to your POS system, so you don’t have to switch between devices or apps to make sure all orders are coming through.

Know Your Numbers

When you know exactly how much each sandwich costs you to produce, you can look at areas to reduce costs like reducing food waste from spoilage, optimizing your prep to minimize wastage, and putting in measures to stop theft..

The finer details become even more crucial when you’re operating at scale. A few pennies lost here or there is okay when you’re running one busy shop, but these add up when you start to open new locations.  

Aside from your daily sales numbers, staffing costs, and other fundamental metrics which you’re already tracking if you run a profitable shop, you also need to know:

Food Cost of Each Sandwich 

How much does it cost to make your most popular menu items? This includes the cost of every ingredient that goes into it, from the squeeze of sauce and the single gram of lettuce up to the exact portions of the most expensive ingredients.

Once you get accurate numbers for each ingredient and menu item, you can go further and figure out your food cost variance, which helps you identify ways to improve your margins. 

Food Cost Variance

Food cost variance compares the actual cost of making an item to what it should cost under ideal conditions. The difference tells you how far off the mark you are so you can take steps to improve and bring the variance closer to zero.

The common ways to reduce your food cost variance are to reduce waste, control portion sizes, and combat theft. Better inventory management is the way to achieve this.

Find out how to calculate the most important sandwich shop metrics, including food cost variance.

The Meat: Your Team and Culture

Your people are everything. Creating and maintaining a positive culture enables them to thrive. You must be intentional about creating an environment of trust, responsibility, and attention to detail—and replicate that in every new shop.

Operational processes are only going to work if your team is motivated and engaged enough to put them into practice every single day. 

Three years after COVID-19 restrictions disrupted the restaurant industry like never before, restaurants are still having difficulties finding and keeping staff. A recent poll by Bloomberg found that 60% of restaurants are understaffed in the U.S.

Staff retention is one of the most important areas of focus for a sandwich shop at the best of times. Right now, it’s vital.

How to Improve Morale and Retention

Better technology 

Giving your team the tools to do their jobs better and make their lives easier is one of the quickest ways to boost morale and productivity. 

For example:

• Digital checklists make cleaning more engaging and satisfying
• Easy-to-access digital schedules help staff manage their shifts
• A cloud-based POS makes it quick and easy to take orders

Consumers are ready for technology, too. Our survey found that 79% of customers say they should be able to use technology to place food orders to help restaurants cope with the labor shortage.

Improve onboarding and training

Nothing is worse than uncertainty at work. Employees will be happier and more likely to stick around if you have solid repeatable processes in place. When they know what they need to do and have the tools to do it, they can be comfortable completing their tasks.

Make sure your onboarding process is long enough to get everyone clear on the responsibilities and tasks required of them. And remember that training and development are ongoing processes. 

Consider implementing management training for staff that show loyalty and competence. Developing your best talent allows you to promote from within and maintain your culture and standards more easily across multiple shops.

Staff perks

Providing a decent living wage is one thing, but if you want to keep employees for longer, you may have to go further. Consider offering (more) paid time off, better staff discounts, and social events to build staff bonds.

This may seem counterintuitive in the current climate of rising business costs, but if you can keep your teams happy and offer better perks than your competitors, you will save money in the long run.

The Secret Sauce: Marketing and Growth

Marketing is going to be critical when you’re opening shops in new areas. Building a solid brand is the first step, but you likely already have this if you’re running a successful sandwich shop. 

Now you can start to use strategic campaigns to engage the right people and develop a solid customer base at each shop.

Get Involved Locally

When you’re expanding into new markets one of the best ways to spread the word and engage your new audience is to get active locally. Our research shows that diners care about the local impact of restaurants, with 80% saying restaurants should be active in the community and half of respondents saying fresh and local produce is important to them when picking a restaurant.

For a sandwich shop, there are tons of opportunities to get involved in your area, like:

• Sourcing your bread from a local bakery
• Finding local suppliers for your premium fixings
• Sponsoring a local sports team
• Partnering with a community garden for your salad ingredients
• Using a local roastery for your coffee supply

Not only will this help you win the locals, but it can also reduce ingredient costs and help mitigate supply chain problems.

Personalize Your Messaging

However you engage with potential customers, personalization is the way to get their attention. Our report found that 72% of Americans between ages 19 and 40 feel personalization in restaurant marketing is at least somewhat important—if not very important. And for 30- to 39-year-olds, 44% feel it is very important.

Modern technology makes it easy to personalize messages and send out targeted offers to customers’ phones.

Once you have a CRM (customer relationship management) system capturing your customer data and preferences, you can segment your audience and target certain offers to specific people. For example, you could send a discount code to everyone who has ordered in the last week.

Text and email marketing tools make it easy to reach customers directly with these offers, allowing them to respond and reorder with the click of a button.

Build Loyalty 

Loyalty programs, such as physical stamp cards and digital points schemes, are a great way to get a shop started in a new area. If you can get the message out to local businesses and residents, you’ll start to see regular customers looking for a daily lunch option.

A digital loyalty program can automatically dole out rewards and freebies to customers when they order a certain number of times online, but it should also work seamlessly with offline loyalty schemes. One way to achieve this is to offer digital loyalty cards on a mobile app so that online and offline purchases are tracked and rewarded.

Leverage the Latest Technology to Grow Your Sandwich Chain

The best way to put rock-solid repeatable processes in place is to use the latest tech tools.

Technology helps your business thrive in every area, from front-of-house operations to inventory management to marketing. It’s the invisible hand improving quality, consistency, and profitability. 

An all-in-one restaurant management platform like HungerRush can help you see all your business data in one place, take command of your entire operation, and grow faster—all while maintaining the quality and consistency your success was built on. 

Partner with HungerRush to capitalize on emerging trends and get access to the latest tools to boost your profitability.

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