Subway Café Expands On Chain's Traditional Concept

Subway has long been known as a lunch venue, but a franchisee team in San Diego says breakfast and snack dayparts are booming at its recently opened Subway Café restaurants.

"Sales are much higher than regular Subways and have far exceeded our expectations," said Rohit Marwaha, who with his brother Raghu opened one Subway Café in downtown San Diego in September and another in the Mission Hills area of that city last month.

His family has operated Subway restaurants in southern California since 1994, he said.

Marwaha declined to reveal anticipated sales or by how much the unit was exceeding them.

Traditional Subway units earned an estimated $453,600 in sales annually as of the fiscal year ended December 2010, according to Nation's Restaurant News' Top 200 census.

The Subway Café concept, which some franchisees have been experimenting with since 2008, features an expanded breakfast menu with muffins, cinnamon rolls and croissant sandwiches in addition to breakfast sandwiches Subway introduced last year.

It also sells premium coffee, including espresso drinks — a single shot is $1.67 with tax, a small cappuccino is $2.91 at the San Diego units — and frozen blended coffee beverages in a setting that features free WiFi, satellite television and better seating than that of traditional Subway units.

Nationwide, 20 Subway Café units have opened so far and dozens more are in the planning stages, according to a spokeswoman for the Milford, Conn.-based franchisor.

The downtown San Diego Café is open around the clock, while the Mission Hills location is open from 6am until midnight — although Rohit Marwaha said they were exploring also keeping it open for 24 hours.

"Sometimes you can see lines outdoors at 2 a.m. at the downtown restaurant," he said. "And during the day you can see people on their laptops, you can see people having business meetings or social get-together among friends."

He said he had seen increased traffic at all of his restaurants when Subway introduced breakfast last year.

"We thought if we provided the right ambience and the expanded breakfast items, our customers would respond," he said.

Marwaha would not say how much more investment was required to open a Subway Café compared with a conventional Subway restaurant, although he said it required an additional 300 square feet to 400 square feet.

Other Subway Café franchisees previously estimated the additional investment cost at around $50,000.

The first Subway Café was launched in an office building in Alexandria, Va., in 2008.

Marwaha said an ideal site for the concept should have high demand for breakfast and be near offices for lunch business, as well as near residential areas for weekend traffic.

Contact Bret Thorn at bret.thorn@penton.com.
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