The tremendous success of the Subway chain is a testament to the fact that you do not need to know everything about the business before you open up shop. When DeLuca first got into the sandwich-making business, he was doing two things he had never done before; not only had he never ran a business, but he had never even made a submarine sandwich before.
Before opening up his store on the morning of August 28, 1965, DeLuca went for a drive with his partner, Pete Buck. They were on a mission to learn as much as they could about the business – as fast as they could. They went from one sandwich store to the next throughout the state in order to see how their businesses operated. They observed everything, from how much seasoning was used, to how they poured oil onto the meat.
“You know,” says DeLuca, “you start a business and you really don’t have much of a budget.” They did not even have enough money to make practice sandwiches and sample them themselves. DeLuca had to make his submarine sandwiches perfect from the get-go, and so he began his mission to learn from others on the road.
“I had a lot to learn,” says DeLuca. One day, when the 17 year old was driving around, his car broke down. A young boy stopped to offer him a ride and the two got to talking. “We passed by my store,” he recalls. “He says to me, ‘That is a great place to eat. They make terrific sandwiches, and you get all the soda you want for free.’” DeLuca asked the boy how it worked. “He said, ‘You order some sandwiches, and when the kid’ – he was referring to me – ‘when the kid turns around to make them, you just take a case of soda out of the cooler and sneak it out to your car.’ So, you see, the lessons I learned back then – they were so simple.”
DeLuca laughs about it now, but in the beginning, his inexperience was no laughing matter. He was struggling to run a business at the same time as he was going to university. On the first day the store opened, he had an English exam and had to show a friend of his how to make the sandwiches so he could leave to write the exam. When DeLuca returned, there was a long line of customers out the door. “Pete is walking across the parking lot holding this paper bag. He said, ‘I had to go buy some knives.’ I worked in a hardware store, so I knew that knives could be expensive or cheap, so I looked in the bag and said, ‘Oh, Jesus, there goes the budget.’”
DeLuca started small, worked hard to keep his costs low, and learned the business as he went. He knew he might never have the opportunity again and he seized it.
It was with that same attitude that DeLuca approached franchising, something he also had no experience with. “We didn't really know the franchising business, and it's [a very] different business from the store operations business,” he says. “Just because we knew how to run stores didn't mean we knew how to run a franchising company – at that point, we were in the beginning stages of learning how to be a franchiser.”
In the end, DeLuca learned how to run both a store and a franchising operation even though he had started from scratch, demonstrating that his success came from learning along the way.
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