Dubai: Subway, the American sandwich chain operator, is proving to be a hit with customers as well as with potential franchise partners in the region.

"At our last franchising event in Dubai we saw the number of attendees had gone up; there's a huge interest because it's usually the safest investment for people to get into as you have a higher chance of succeeding," said Marwan Al Hamar, Subway's development agent in the UAE.

"When setting up your own business, you have a 50 per cent chance of failure." One reason behind the interest is that the start-up costs are low for a franchise of their size with the average investment per store set at around Dh70,000.

Less than 10 per cent of the total number of stores are owned directly by the company, while the rest are with individual owners. According to Al Hamar, the huge interest in franchising has also boosted store numbers.

Subway has established itself as the largest sandwich chain in the Middle East with more than 300 outlets. It entered the UAE market in 1998 and since has maintained an aggressive expansion plan with 107 stores and plans to open 25 stores every year until they reach their target of 200 with combined investments of around Dh70 million.

Subway estimates its market share of the fast food market to be at 20 per cent and on par with McDonalds and KFC. As fast food sales continue to recover from the slump seen in 2008, Subway reported a 6 per cent rise in revenues in 2010 over 2009.

According to Al Hamar, the best performing outlets are the standalone stores, while those in malls come in second and followed by gas stations.

"Our street locations with good seating area are our most successful locations," said Al Hamar. "Locations in industrial areas are the least successful and that is probably due to the nature of the customer base in those areas."

The stores are spread all over the UAE with new locations in the Ras Al Khaimah, Ajman and Abu Dhabi. We look for locations that have high visibility and easy access," said Al Hamar.

While now an established brand in the Middle East, Al Hamar says there is still work to be done to try and attract a larger customer base.

"Getting people in to try the product is our greatest challenge," said Al Hamar. "Our most common comment is that we serve cold sandwiches; however only 30 per cent of our sandwiches are cold."