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Subway founder Fred DeLuca poses in a Subway branch in central London January 26, 2012. U.S. sandwich chain Subway plans to open 600 new branches in Britain and Ireland over the next three years creating 6000 jobs. (STEFAN WERMUTH/STEFAN WERMUTH/REUTERS)
Subway founder Fred DeLuca poses in a Subway branch in central London January 26, 2012. U.S. sandwich chain Subway plans to open 600 new branches in Britain and Ireland over the next three years creating 6000 jobs. (STEFAN WERMUTH/STEFAN WERMUTH/REUTERS)

Subway plans huge U.K. expansion Add to ...

The Subway franchise of sandwich restaurants is planning a huge expansion in the British Isles to capitalize on the locals’ growing appetite in straitened times for cheap food on the go.

The company, which currently offers a £3 ($4.68 U.S.) lunch deal, said on Thursday it was targeting 600 new stores in Britain and Ireland by 2015, creating about 6,000 new jobs.

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Subway currently trades from 1,423 stores in Britain, nearly a fivefold increase on the 2004 level, and 99 in Ireland.

“We find that no matter what country we’re in, if we hit the right economic notes and appeal to the mass market, we’re able to build the business very, very rapidly,” Subway’s president and founder Fred DeLuca told Reuters in an interview.

As well as traditional high street store development, the firm sees huge potential for non-traditional settings such as stations, convenience stores, hospitals, airports and petrol stations, mirroring a strategy being pursued by British baker Greggs, which currently trades from about 1,550 stores.

British retailers are generally struggling as shoppers’ disposable incomes are squeezed by rising prices, muted wages growth and government austerity measures.

Firms like Subway and Greggs, with their relatively low average transaction values, have fared better than most.

Mr. DeLuca said sales at British Subway stores open over a year were up 10 per cent over the last 13 weeks.

Globally Subway has over 36,000 outlets in 98 countries from Afghanistan to Zambia. All stores are independently owned and operated by franchisees.

Mr. DeLuca dismissed the suggestion there was a danger the firm could reach overcapacity in Britain.

“Everybody eats three times a day; it’s only a question of where they choose to eat. The longer-term trends are people eat out more often,” he said.

“When we get to 2,000 stores, we’ll have about one store for every 30,000 people (in the U.K.). That’s actually quite low density for us. In the U.S. and Canada we have one store for every 12,000 people.”

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