Subway Eat Fresh! What you ran out of Lettuce?

Ever since we have done that forecasting activity in class last week, with us being in charge of ordering the right amount of boxes of inventory for the upcoming week, so we are not short or waste our product. It made me think about the time, when I worked at my Dads Subway franchise store. I felt like it was the perfect example since the process of predicting a future, underlined the basis of all business decisions mostly to do with personnel, production, and most important Inventory. I never really realized how important it is to make sure you have the upcoming inventory absolutely as close as you can. Thats not all in subway, I believe there are alot of things to do with forecasting at our store, such as the  demand forecast that leads to the price on the menu, depends on how many costumers like that sandwich,or even new products that come in with different promotions. We change up the price on the menu due to new items, class favorites, or just simply because of the economy. Now if plan on changing the prices, we cant just charge someone $15 dollars for a sandwich when it only cost 6 bucks. We have to use the actual demand for that sandwich, as well as forecast store sales around us in the same region, understand what there selling price is  and place a predicted demand of the data we know. The trick is not to place the price higher than your competitor and not lower that what you are need to make a revenue. Which leads us to forecast the right price so in the end we win both ways.

Not only does price have to do with subway Every 2 weeks we have to do an inventory count at our store, to see what we need or what was used more, making sure we dont miss a step since it is vital for our store to be fully stocked at all times. For instance if we run out of lettuce that day and realize that we still have 2 more days till the next inventory to be here, where in big trouble since we did not accumulate enough boxes of lettuce for that week. Which now leads us to shortage of lettuce for costumers that really need lettuce on their sandwiches. That applies to all meat products, vegetables, cheese, new supplies and containers. You guys might think OMG, this must be such a hassle, it kind of is, but what made it easier is the stable historical data that we have stored in the computer as well as a check list for previous entries of boxes we have sold before. This  includes all the information of product we use from months to weeks all the way to how much of the product we have used daily. This helps us alot to forecast our future weeks up ahead, the data can be all the way from 2 years back. I guess the forecasting Approach, is similar and alike as the Quantitative approach using existing products and current technology that is stable and consists of historical data. You might think that there is no mathematical approach but there is since we use our costumer data , as well as the gross income, to make the right decision so we dont wast our product nor are we running out.

Forecasting is not only big at our store it defines what we do everyday, to make sure that we never have a problem. Even Forecasting how many employees you want to work for that day. If we know a monday is going to be slower than a saturday, we rather put two workers instead of 4, how is that done by forecasting daily through our business revenue patterns through trend projection of monday to Sunday.

I guess the real question is what would franchises and business like us do with out forecasting? Have you ever gone to a place and found out that they ran out of something you really wanted? What other Managment Operations are used that I have not included in here?

Hope this was interesting 🙂

8 thoughts on “Subway Eat Fresh! What you ran out of Lettuce?

  1. Without forecasting, a company cannot function. If a company is always over purchasing a product, like lettuce, they have to acknowledge their inventory costs. If they don’t purchase enough of a product, then they will have angry customers in which they will not come back to that specific restaurant or store, and will also give the company a bad reputation as a whole. The last time I went to Portillo’s, I was devastated to hear that they were out of fries. Knowing that Portillo’s is always busy, I was surprised that they did not forecast for enough fries for that certain period and time of year when they have been open for so many years. Because of this, many customers may choose to not go back to Portillo’s because of their bad forecasting.

  2. Forecasting is crucial part to any business. For my birthday I always go to my favorite restaurant, J. Alexanders. I love there food and was looking forward to the glazed croissants they serve. Of course, they were out of croissants for the day, I was so disappointed.

  3. Forecasting is such an important part to any business. For my birthday I always go to my favorite restaurant, J. Alexanders. I love there food and was looking forward to the glazed croissants they serve. Of course, they were out of croissants for the day, I was so disappointed. My not forecasting correctly in a restaurant, the restaurant disappoints so many customers who come to the restaurant for a particular dish.

  4. Once I had the experience of walking into a restaurant and ordering an item on the menu that was not available… did I feel at that time? Very disappointed!

    This topic is really interesting to me, since I have always wondered how did food business function in terms of purchasing and storage the material required for food preparation. I also thought about this; because food business in Bahrain is very successful and I am planning to have my own some day. Being an Accountant, forecasting is my middle name; however, budget and cost forecast is not as easy as inventory forecast. I totally agree with my colleagues that every business must forecast and a good food business is determined by the service and quality of food; therefore, forecasting is important since it will impact the quality and availability of food being served.

  5. I see forecasting as a part of planning for any successful organization, any successful organization spent millions of dollars in forecasting, your article remind me about one subject I have read it last month. How one second could cost Amazon $1.6 billion in sales, I was really surprise when I read the article It says how there system must be fast through the net or else they are going to lose their customer, so if they don’t forecast what is going to happen in near future it means that Amazon is going to lose a lot of their customer because of the slowdown of their system.

  6. I work at a retail bank however I can relate to this, since we have the ATM machine of which we have to forecast and use analysis to estimate how much cash we should put in the ATM. I remember when we first worked at the branch we had to come (always on the weekends) to add cash to the ATM, because we couldn’t really figure out the demand of cash during the weekends. After some time and due to the historical data we created and after studying the customer’s demand and usage of the ATM, we are able to predict the amount of cash needed for the ATM. We don’t need to visit the bank anymore during the weekends.

  7. I had a similar case with the business I started with my friend, we had an outfit store where we shipped the brands and sold them locally. Following up the purchases and estimating the number of inventories was not a priority to us while running the business. The following months the inventory was pilling up we the supply was much more than the demand. Forecasting, reviewing the customer’s behaviors, and meeting the demand with a similar supply is our priority now.

  8. Forecasting is indeed really crucial to a business regardless if you’re in a management position for just an associate on the sales floor. In regards to forecasting, I work at a retail store which sometimes gets really inconvenient when we do sell out of a certain item. We don’t have a system of forecasting because in short, if we sell out of something, that’s the end of it. It does get incredibly frustrating having to explain it to the customer’s at the store I work at. Although we don’t have this type of system at our store, it really helps me understand that forecasting should be much more of a priority to have for us to do better business, in my opinion.

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