Last week, I identified the focus-differentiation strategy as the best strategy
ID: 426355 • Letter: L
Question
Last week, I identified the focus-differentiation strategy as the best strategy for Subway to move forward with. Subway is doing well, so it should refrain from any drastic changes. However, they should make some effort to modify itself and keep its menu fresh and appealing. Other strategies, like cost-leadership and cost-focus may be a bit beneficial to Subway in its current form. Cost-leadership is a strategy that reduces cost and expenses while keeping its prices the same (Mindtools, 2017). Subway is in a good position to use this method because it has enough money to experiment with new methods and technologies to save money. Also, Subway has a pretty small staff per store compared to other fast food restaurants. They have already used the cost-leadership strategy to an extent, but maybe they can utilize it more. By introducing the touchpad technology that McDonalds and Burger King use in Korea, Subway can cut costs and speed up service for customers (Korea Bizwire, 2018).
Another alternative that could be used is the cost-focus strategy. The cost-focus strategy is a way to lower costs while focusing on its core consumer base (Mindtools, 2017). This will be a bit more difficult because Subway will need to research its customer base and form accurate conclusions about what its customers want. To follow this strategy, Subway needs to build a inexpensive vegan/organic diet. People think that eating healthy is too expensive. But if Subway can show that it is possible to be a budget vegan, then it will get a large boost in sales.
How would you respond to that?
What would you say or think about this?
Explanation / Answer
1. The differentiation strategy is indeed best for subway at this business level that it is. Also what it needs to do is cut cost and focuses on menu like making changes in its menu so it keeps attracting new customers and retain old also it needs to do research on its consumer base to better understand and formulate their strategy.
2. I would say that the document is well written focusing on the strategy aspect of Subway and what it needs to do at its current business stage. The article very well states about the business condition and environment of subway and give the best strategy that it can follow to be in growth race Like without bringing a big change in its business style, it should take the cost and consumer aspect and formulate a strategy.
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