Sandwich Shops Pile On The Growth

When compared to other restaurant segments, sandwich shops don't always get the respect they deserve. Although the menus may be less extensive and elaborate than those at other types of eateries, plenty of innovation goes into creating these simple dishes that most people regularly consume.

Mon-Ami-CounterCommunity Canteen"It's difficult to do something new and unique in the sandwich segment, since everyone is trying to come up with the next best thing," says Ron Santibanez, CEO of Moreno Valley, Calif.-based Profit Line Consulting. "It's still an expanding segment."

Technomic's Top 500 report states that the "other sandwich" segment totaled $27.7 billion in 2012, up 6.3 percent from 2011. There were 54,289 units in this segment during this period, an increase of more than 3 percent. Sandwich chains within the Top 500, including Subway, Arby's, Jimmy John's and Quiznos, had sales totaling $21.9 billion in 2012, up 5.9 percent from 2011, and operated 39,368 total units.

The trend in healthier options remains prevalent among sandwich shops. "Subway continues leading the charge in promoting low fat, lower calories and less sodium," Santibanez says. "Although sandwich shops promote healthier sandwich options to get people in the door, these operations still sell more indulgent
varieties, such as meatball subs and pastrami sandwiches."

Although a number of sandwich shops provide gluten-free options, these items appeal to a small percentage of the population. "Every new client I deal with talks about providing a gluten-free option, but in the end it always comes back to taste," Santibanez says.

More sandwich shops now incorporate ethnic dishes into their menus to better compete in this segment. "I've been seeing a trend more towards many ethnic dishes in sandwich industry," Santibanez says. "The appeal is providing a low-cost item that has a unique ethnic twist."

Freshness remains the focus in this segment, as customers now expect to see their sandwiches made to order. Offering grab-and-go and retail options has also become more commonplace.

Profit Line worked with a California client to develop an upscale deli concept that includes a retail marketplace. "It replicates the type of New York deli where meat and cheese is sliced fresh in front of customers," Santibanez says. "Some sandwich shops are going this route, offering prepackaged products that provide higher quality with perceived value."

In addition to adding grab-and-go sections, these operations continue to expand side dish options by incorporating pasta salads, marinated olives or artichokes and other more upscale items. Signature breads have become another important component of sandwich shops as well, providing a point of differentiation.

"Manufacturers are offering excellent par-baked products for sandwich shops, since baking bread in-house provides an appealing aroma," Santibanez says. "Success in this segment is all about being unique."

Key Equipment

  • Convection ovens
  • Speed ovens
  • Prep tables
  • Walk-in refrigerators
  • Induction burners
  • Panini grills
  • Mixers
  • Slicers
  • Food processors

E&S Considerations

  • Durability: Because they tend to be higher-volume operations, sandwich shops —especially those that offer catering services — need equipment that stands up to heavy use.
  • Speed of service: Customers in this segment have limited time to grab a bite. Equipment that provides fast turnaround, such as rapid-speed ovens and induction burners, can help expedite service.
  • Size: Due to the fact that sandwich shop kitchens typically have smaller footprints, these operators prefer smaller-sized equipment.
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