No Experience Needed (page 2 of 2)

Intimate Ties

But they learned. When DeLuca's car broke down, he hitched a ride with a kid who was an enthusiastic Subway fan. "This kid points to my store and says, 'They have great sandwiches, and you can get all the soda you want free. You go in with a few friends and order sandwiches, and when the kid behind the counter turns around to make them, you go into the cooler and sneak the soda out.' "

DeLuca was flabbergasted. He hadn't realized that he needed to keep track of his sales and his inventory. But the partners' seat-of-the-pants, learn-as-you-go approach turned out to be one of their strengths.

For example, every Friday, DeLuca and his mom would drive around and hand-deliver the checks to pay their suppliers. "It probably took us two and a half hours and it wasn't necessary, but as a result, the suppliers got to know us very well. They allowed us more credit than we deserved, and the personal relationships that resulted really helped out," DeLuca says.

And having a goal was a huge plus. "Even though it felt like we were a gang that couldn't shoot straight, we knew what direction we were going. Being persistent was important," DeLuca emphasizes. "There are so many obstacles that can get you down. You just have to keep working toward your objective."

After eight years, they had expanded to 16 stores, forcing DeLuca to make a crucial decision. "The stores that weren't close were not doing well, and it was too far to travel to control things. That's when we decided to franchise."

By 1982, with the team operating 200 stores, DeLuca was thinking big. "I set a goal of having 5,000 stores by 1994. The team thought I was crazy."

They blew past DeLuca's goal, operating 8,000 stores by 1994. Today, Subway Restaurants number 20,446 stores in the United States, and 6,113 stores overseas.

In many ways, Subway continues to be a network of family and close friends. "I am still partners with Pete," DeLuca reports. "My sister works here. My mom is retired from the board. I have uncles, aunts and a cousin in the business. Our old-time franchisees are bringing their sons and daughters into the business." Even Dick, who designed the first logo, still works with Subway.

Those intimate ties provided a safety net for the fledgling company. Later, they helped it grow and prosper. For DeLuca, they are the ultimate secret to his success. As he says, "It's just a bigger family now."

From Reader's Digest - January 2007

 

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• The Importance of Ethics
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