Term Presentation

Microeconomics

By: Mansoor Ali

Ahmed Ali Kalroo
Faraz Zia
Talha Rabbani Lakho
M. Hatim Jokhio
 Introduction
• Subway is a multinational food chain originated from
America.
• It is a private business.
• The branches that we have covered are Malir Cantt and
Ittehad commercial both situated in Karachi, Pakistan.
• These franchises are partially owned by Mr. Farhan Zia and
Mr. Mudassir Fayyaz.
• Provides healthy and valuable meals at all times as most of
the branches are opened 24/7.
• Some of the products of Subway include all kinds of
Sandwiches, Salads and Cookies.
• It is one of the fastest-growing franchises in the world.
•
 Factors of Production
• Factors of production required for the running the
business successfully requires, Land, Labor, Capital,
entrepreneurial abilities.
• It also required and raw products which include chicken,
fresh cut vegetables, sauces, freshly baked breads,
electricity, gas and water.
• Machinery that required are ovens, choppers, deep
freezers and microwaves.
 Variable and Fixed Inputs
• Variable input that can be changed if a firm seeks to
change the quantity of output produced. Subways variable
inputs include labor, electricity, chicken vegetables, bread
and cookies.
• Another fixed inputs of subway are rent, equipment,
salaries and wages of employees will remain fixed no
matter how many customers they deal with.
 Demands & Supply
• The determinants of demands in Subway are price of the
products.
• If we increase the prices by 10% the quantity demand will fall by
less than 10% because the demand is relatively inelastic.
• It means that change in price will not affect the quantity
purchased to a great extent. This may be Subways consumers
have no other choice which substitute subways taste because
Subways has their own taste and different from other competitors.
• The total revenue of Subway will be affected little; it will increase
because the demand is relatively inelastic the change in price of
10% will result in quantity demand to fall by less than 10%.
 Charts

Price Quantity Quantity Supply Increase in

Demanded Demand
D D1 S

PE2
280 90 40 110
PE1

320 110 60 130

350 130 80 150

S D D1
420 150 110 170
QE1 QE2
 What Company does best?
• The restaurant is known for its fresh products which are
served there and then to its customers.
• The hygiene and cleanliness.
• Lighting fast service.
• Their franchises are very friendly, safe and clean as they
mainly emphasize on their employee training on
maintaining good customer relations and maintaining
cleanliness in their branch.
 What it does not do best?
• Subway is not good at product innovation as it only offers
selected items since it first came into being.
• Just selling subs, cookies, salads and drinks and nothing
else.
• Customers who demand fries, coleslaw and other sidelines
along with their sub but however subway lacks in this
service.
• Subway is not actively taking part in their advertisement or
marketing compared to other local or international brands.
This can be a reason for limited sales and less awareness.
 Conclusion
• As a team we learnt a lot from this project as it gave us an
opportunity to explore a multinational food chain and how it is
operated.
• We got to learn a lot about their policies and standards which the
franchise owner has to follow in order to keep the business running.
• This project taught us good communication skills, broadened our
minds and gave exposure to different kinds of people doing
different kinds of jobs and businesses to earn bread and butter for
their families or themselves.
• We even got to know about the real life experiences of
how the demand and supply both fluctuate with the factor
of price and location.
• Well, Our recommendations to subway are that they
should introduce new products in the market or make
room for sidelines in the same price they are offering. This
might attract customers and their revenue might increase.
THANKS