Mr. Sub is a Canadian submarine sandwich chain founded in 1990 that has expanded to 335 locations across Canada. It offers a variety of subs, wraps, salads, and soups. The presentation recommends Mr. Sub expand into China, highlighting strengths such as a diversified menu and experience, but also weaknesses like limited brand recognition outside Canada. A SWOT analysis and market entry strategy are provided, targeting urban youth. Financial projections show increasing profits over two years in China. The conclusion is that Mr. Sub should proceed with expansion to China.

1. Presented By:
Geeta Sakhuja, Moon Guo, Maninder Mangat and Zaman Ahmed

2. • Established in 1990 by Jack Levinson and Earl Linzon.
• First opened in Toronto and has now developed into a chain of
335 submarine sandwich shops in Canada.
• Mr. Sub’s menu includes a wide choice of subs such as the
Panini grilles subs, wraps, salads and soups.
• They also offer catering services for school and office parties
along with delivery and take-out options.
About Mr. Sub

3. Demographic characteristics
• The official language is Mandarin.
• 45% of Chinese report the ability to speak English.
• In 2012, Unemployment Rate averaged 4.15 %
Macro-economic factors
• China is an export oriented market economy.
• China's gross domestic product growth increased in the past 10 years
• China’s labor force in 2012 was 795.5 million
Target Country Assessment

4. Mr. Sub’s Competition

5. Strengths:
Weaknesses:
• Well diversified menu list
• Strong administration ties
• Potential to grow among the
competition in the new market
• Great business experience
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Opportunities:
Threats:
• Placing products in grocery stores
• Mr. Sub can gain more consumers using
the adaptation approach
• Positive feedback from Chinese
consumers for fast food
• Faces tough competition from global
competitors such as:
• Burger King, Subway and McDonald’s
• Competition in Chinese market:
• Yonghe King and Sun Ya Da Bao
Not widely known
Only Canada wide recognition
Not enough marketing promotion
No visible CSR practices
SWOT ANALYSIS

6. • Mr. Sub should gain 10% of market share by the end of first
fiscal year.
• Enter the market with competitive pricing
• Opening outlets in most populated provinces.
• Target 72.1% population of male and female of age group 14-40.
Marketing Objectives

7. • Existing Franchising model
• Franchising has become a popular method of investment in China
• As urban and rural disposable income rises, market potential also
continues to rise rapidly.
• The new regulations indicate that cross-border franchise
operations are possible.
• The new regulation also cancels previous additional filing
requirements
• Does not require the franchisor to be located in China.
Market Entry Strategy

8. • Location: Urban area
• Ages: 14~40.
• Educated, professional, middle class & high disposable
income.
• Lifestyle: Active, Environmentally aware and have high
level of health concern.
Target Consumer

9. Product line offering:
• Localize and diversify its menu to better fit the Chinese
customers
Packaging:
• Mr. Sub’s original red packaging theme
• Comparatively smaller package sizes
• Recyclable and environment friendly
Branding Strategy:
• Healthy eating and balanced lifestyle
• Shopping Bags and some products;
• Fresh and healthy
• Tasty good.
Marketing Mix - PRODUCT

10. Services rendered:
• Outstanding customer service
• Knowledgeable employees
• Mr. Sub will also cater school programs and parties
Store layout:
• Consistent with the layout that is displayed in
Canada
MARKETING MIX - PRODUCT

11. • Competitive Pricing:
• High food quality standard
• Set the price a bit lower.
• Wholesale Pricing Program
• Focuses on partnering with gyms, schools and companies that offer
healthy food choice.
• Factors/Impacts on Pricing Strategy:
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Currency Fluctuations
Inflation
Government Controls
Subsidies and
Competitive Pricing
Price

12. • Mr. Sub would set up franchises at some of the busiest and crowded
areas of China where people are always on the go.
• There are three location strategies an international restaurant
franchisor can adopt when entering the Shanghai market:
• (1) Locating in the Downtown Area
• (2) Locating in the Special Economic Zones, and
• (3) Locating near an upscale residential area.
Place

13. Some of the advertising methods we wish to follow for Mr. Sub
would include the following:
1. Creating a new video advertisement to be published in China
• Theme: “SUMMER SUB”
• Media used: Commercial published on the local TV channels,
radio stations and on YouTube
• Frequency: Advertise twice every week and keep customers
regularly updated with Facebook updates, and tweets.
• Timing: Mid-July to August end.
Promotion

14. 2. Discount Special – MR. SUB sandwich with 2 cokes at
10% Off.
• Theme: “MR. SUB FALL SPECIAL – 10% OFF”
• Media used: For discount promotions publish flyers in
frequently read newspapers and magazines.
• Frequency: Advertise for every weekend until the winter
approaches.
• Timing: Mid-September to December end.
Fall Promotion

15. Mr Sub. Profit & Loss Statement.
2013
Sales
2014
200,000
300,000
Cost of Goods sold
100,000
120,000
Gross Profit
100,000
180,000
Total Expenses
75,000
85,000
Net Income Before Depreciation
25,000
95,000
Deprecation
(9,500)
(10,500)
Net Income Before Taxes
15,500
84,500
Income Taxes
2,290
2,519
Total Income
13,210
81,981
Financial Analysis

16. Based on our intensive research
we believe that Mr. Sub should
move further with its expansion to
China.
Decision