Documente Academic
Documente Profesional
Documente Cultură
Beverages:.................................................................................................. 27
Jumbo King: The Making of an Indian Fast-food Chain..............................................35
3.5 DOMINOS............................................................................................... 50
3.6 Challenges for the industry......................................................................53
3.7 PROBLEMS OF INDUSTRY.........................................................................55
3.8 Trends in Indian market............................................................................57
3.9 Indian Fast Food Industry growth and its important Players.................................58
3.10 Indian Fast Food Market Analysis...........................................................59
4. Collection and analysis of data, Interpretation of data...............................63
Sample and Research design:...............................................................................64
Tools and Methods of Data Collection:...................................................................64
.............................................................................................. 64
[2]
[3]
[4]
LITERATURE
REVIEW
[5]
The concept of fast food pops up during 1920s.The 1950s first witnessed their
rapid proliferation. Several factors that contributed to this explosive growth in 50s were:
(1) Americas love affair with the automobiles.
(2) The construction of a major new highway system.
(3) The development of sub-urban communities.
(4) The baby boom subsequent to world war second.
The development of Indian cuisine has a very long and turbulent history and is
ever changing even today as Indians try new cuisines and are exposed to new influences
and people from other nations.
Sen (2004) traced the historical origins of Indian cuisine and a summary of these
different influences is shown next page:
Prehistory
2000800 BC
1000500 BC
6th century BC
1st century AD
5th century AD
12061536
Late-15th
early-16th
century
17th century
18301850
1857
1977
1996
2003
2.2 Emergence
The fast food culture emerged as early as the 19th century. During the Industrial
Revolution, a large workforce was required to work for 10 to 12 hours a day. With so
much work to be done, fast food was the idea of a quick and easy lunch.
In India, fast food culture emerged in the decades after independence, starting
from the 1950s. Eating at home used to be a significant aspect of Indian culture, so the
change was gradual. Over a period of time, with a growth in the number of nuclear
families, economic growth and increasing per capita income as well as globalization, fast
food culture gained prominence. Women were shifting from their conventional roles of
managing the household and taking care of the children. With growth in literacy, they
[8]
started joining the workforce in large numbers. Fast food became a time-saving
alternative to cooking for them.
Similarly, children resorted to fast food to fill their stomachs in school and
college. Their exposure to global urban culture and Western cuisine accelerated their
want for cheap and delicious fast food.
Moreover, fast food costs less than traditional long meals commencing with
appetizer and concluding with dessert.
Nirulas and Pizza Corner Indias most popular domestic fast food chains
gained rapid popularity during this period. Though the fast food culture originated
abroad, these domestic food chains could create a perfect blend of international food with
Indian ingredients. Paneer pizzas and aloo tikki burgers were indeed able to satisfy Indian
taste buds.
With the liberalization of the economy in 1992, new multinational fast food giants
started dotting India with their outlets. Burger King, Wimpys, Pizza Hut, Dominos
Pizza, McDonalds, and KFC outlets can be seen today in nearly every shopping mall and
other public areas. In fact, these multinationals have given their domestic counterparts a
run for their money. They are growing at a much faster pace than the Indian chains.
[9]
Gender roles are now changing. Females have started working outside. So, they
have no time for their home and cooking food. Fast food is an easy way out because these
can be prepared easily.
Paucity of Time:
People have no time for cooking. Because of emergence of working women and
also number of other entertainment items. Most of the time either people work or want to
enjoy with their family.
Working Women:
Working women have no time for cooking, and if they have then also they dont
want to cook. Because they want to come out of the traditionally defined gender roles.
They do not want to confine themselves to household work and upbringing of childrens.
[10]
Large population:
India being a second largest country in terms of population possesses large
potential market for all the products/services. This results into entry of large number of
fast food players in the country.
Relaxation in rules and regulations:
With the economic liberalization of 1991, most of the tariff and non tariff barriers
from the Indian boundaries are either removed or minimized. This helped significantly
the MNCs to enter in the country.
Menu diversification:
Increase in consumption of pizzas, burgers and other type of fast foods.
[11]
2.3 Impact
The emergence of the fast food industry has, to an extent, transformed urban food
culture in India.
It is common knowledge that too much fast food is bad for health and may lead to
obesity. An essential component of most fast food is fat the kind of fat that in excess
can lead to artery clogging. In large quantities, fast food may lead to obesity as well as
hypertension, diabetes, high cholesterol and heart diseases. Even certain types of cancers
have been observed to spread due to lack of safety standards in some sectors of the fast
food industry.
There are also several environmental problems associated with how fast food
outlets process and package their products. Food packaging is done using plastic,
Styrofoam and other synthetic products which are not biodegradable. In recent times,
many fast food outlets have switched to paper bags. Though paper is biodegradable, at
the large quantities in which paper waste is generated in India, currently paper is seen
more as a pollutant. Metal and glassware would be more favorable to serve food, but they
[12]
destroy the whole purpose of consuming food on-the-go. The need of the hour is a law or
regulation that forces these outlets to recycle the paper, plastic and foam they use
everyday.
Indias fast food industry is growing at 40% per annum and generates over Rs.
4800 crores in sales. The multinational segment of the industry generates over Rs. 7000
crores.
Fast food has, in a way, impacted the Indian economy by creating jobs. Outlets
require a large number of unskilled workers who are willing to work for low wages. On
the one hand, this generates widespread employment. On the other hand, some analysts
feel that it weakens the economy by forcing people to take up jobs in which there is little
room for advancement.
Fast food industry has been very successful in India, both in financial terms as
well as in popularizing its quick service culture among the population.
[13]
restaurants have the daunting task of constantly training an entirely new workforce.
Policies and procedures need to be explained to each new employee.
2.5 Globalization
In 2006, the global fast food market grew by 4.8% and reached a value of 102.4
billion and a volume of 80.3 billion transactions. In India alone the fast food industry is
growing by 40% a year. McDonald's is located in 120 countries and on 6 continents and
operates over 31,000 restaurants worldwide.
KFC is located in 25 countries. Subway has 29,186 restaurants located in 86
countries, Pizza Hut is located in 26 countries, Taco Bell has 278 restaurants located in 12
countries besides the United States.
[15]
Eating out can always be a dilemma between choosing a tasty dish and one that is
low in calories. Therefore, choosing your courses wisely can help you manage the calorie
count.
When considering what to eat for your starter, it is perhaps best to choose
something light, such as a Popadom as this contains only 65 calories. Unlike Samosas or
Onion Bhajis which contain higher calorie content in each portion
Dips are used to enhance the taste of a starter, but dont be fooled, these also
contain calories. A Cucumber Raita or a Tomato Sambal contains approximately 20
calories each. This is significantly less than Mango Chutney or Lime Pickle; a little as
1tbsp can contain up to 70 calories. Yes, you read correctly, 70 calories!
In the present times, it is the fast food craze that has created sensation all over. The
fast food has occupied a demanding position in the list of top hot fad foods. People are
getting lured into trying yummy fast food dishes, without possessing adequate knowledge
regarding Indian fast food nutrition. Well, there is a need for bringing forward some eye
opener nutrition facts about fastfood.
These days, the fast food chains are booming in number and witnessing
flourishing business. Abraham Lincoln had once said, "let the people know the facts and
the country will be safe". Well, it also holds true regarding the information about fast
food nutritional content. The prime motive is to make the people aware of the fact and
then let them take conscious decision.
[16]
In the list of fattening dishes, Korma and Biryani are on the top.
Indian curry makes use of green chilies that are rich in Vitamin C.
All food items like Tikka dishes that are cooked in dry oven contain low fat.
Instead of creamy pasta sauce, eating tomato sauce is a better option, as pasta
sauce contain high fat content.
Well, the basic reason that can be attributed to the increasing consumption of fast
food is the fact that fast food is readily available, quick to make and easy to serve. Media
truly deserves the credit for the wide publicity of fast food stuff. But it is always
advisable to eat healthy nutritious food that can help maintain your overall fitness.
[17]
Research Methodology
Research fall into two distinct types:1) Primary Research
2) Secondary Research
1) Primary Research:It involves the collection of data that does not already exist. This can be
through numerous forms, including
Questionnaires
Interviews of customers
By visiting the Fast Food Restaurant
[18]
2) Secondary research:It involves the summary collection and /or syntheses of existing research rather than
primary research,
News papers
Books
Magazines
Previous project
[19]
EXPLAINATION
[20]
[21]
be anything from a fruit dish with guava, banana, apple or melon, crisp pancakes called
paapri, served with yogurt, or sometimes potatoes sauteed with black cumin powder.
Also on the street carts as standard are Pani Puri hollowed out crispy dough
balls with various fillings, Aaloo Tikki - deep fried mashed potato and masala patties
usually served with a curry called Chholey (chick peas). They are most popular in
Northern India in the winter. If youre on a train, youll often be offered a Chaap, a potato
patty dipped in flour batter and deep fried, usually dished up with onion slices.
Indian Tea and Biscuits:
For a quick sweet snack, try a Chai-faen which is simply a combination of tea
with a roasted biscuit called "faen", or occasionally khaaree biscuit. Another tempting
sweet treat is Vada pav a great example of West Indian street food, eaten with Masala
chai which is a delicately spiced tea. For anyone with a real sweet tooth though, the ideal
snack is a jalebi or jangri, which is a syrup-covered deep-fried sweet available throughout
India.
Regional Variations on Indian Fast Food:
Whats available on the streets to eat can understandably vary depending on
where you are. For example in Calcutta you can find ample street food, and the wide
selection includes phuchka, which is much loved in the city and thought to be the
favourite snack. It consists of little dough balls filled with all sorts of goodies, like
mashed potato and herbs, and dunked in tamarind water and cumin for flavour. Jhaal-
[23]
mudi, another Calcutta specialty, consists of puffed rice spiced with lemon and coriander
and sometimes also mixed with peanuts, chopped onions, and chilli.
In Calcutta, common varieties of fritter are the beguni (aubergines fried in
chickpea batter), phuluri (fried chickpea batter), and pakodas (assorted vegetables fried in
chickpea batter). If you want to stop and pass the time while you eat, Calcutta is also
known for its rice hotels, which serve rice-centric snack style meals.
Moving on to Kerala, in South India, the fast food there is available from
thattukadas which are covered catering carts fully kitted out stoves and utensils. They
usually offer thattu dosa which are rice-flour crepes fried in coconut oil and served with
coconut chutney. Youll also find thattukadas serving up omelettes, spicy pork , and
parottas (like naan breads, but beaten and mixed with oil).
Popular formats of fast food business in India have the following features in common:
Tall tables, usually of stainless steel, where one can eat while standing
Most of the fast food outlets in India are stand alone establishment, few of them having
more than one branch.
Fast food and its different categories:
[25]
South Indian:
Upma, Kesaribhath
Puliyogere
Pongal
Vangibhath
Vegetable Bonda
Others:
Bonda Soup
Rajma rice
[26]
Omelette bread
Chinese food
Pasta
Grilled chicken
Milkshakes
Doner kabab
Dum biryani
Salads
Momas
Fruit beer
[27]
Chicken wings
Grilled Sandwich
Mutar kulcha
Pav bhaji
Stuffed paratha
Fruid salad
Idli sambar
Vada sambar
Dahiwada
Fried Rice
Noodles
Mini Meals
Pizzas
Beverages:
Coffee
[28]
Tea
Lassi
Aerated Drinks
These high quality Fast Food Counters are made by using very high quality raw
material which ensures hassle free work performance at its user end. These Fast Food
Counters are widely finds its applications in various commercial sectors.
[29]
Display Counters:
[30]
These fast food trays are widely finds its application in both commercial as well
as industrial sectors. These fast food trays are available in market at very competitive
prices.
[31]
Fast food is one of the worlds fastest growing food types. India is seeing rapid
growth in the fast food and restaurant industries. It now accounts for roughly half of all
restaurant revenues in the developed countries and continues to expand. The trend is
radically changing the way people eat in India.
Based on rising disposable income, changing consumer behaviour and favourable
demographics, India is witnessing a tremendous growth in its fast food and restaurant
industries. Additional reasons include exposure to western cuisine, the rising number of
nuclear families and growth in the number of employed women, which are also having a
significant impact on the eating out trends and growth of the fast food industry in the
country.
For a nation that is particular about its food and significantly fond of home
cooked and fresh food, this trend is showing the globalisation of India and increase of
[32]
new markets not witnessed in India before. With increasing number of people eating out
the industry offers major opportunities to the players to capture a larger consumer base.
As a result of the trend, all the international food players like Pizza Hut, Dominos,
McDonalds and KFC are investing huge amount of money to grab a share of this highly
lucrative market.
Pizza Hut for example, is one of the flagship brands of Yum! Brands, Inc., which
also has KFC, Taco Bell, A&W and Long John Silvers under its umbrella. Pizza Hut has
143 stores across 34 cities in India.
A report by Research on India has found that traditionally, the Indian consumers
have been eating at roadside eateries, dhabas and stalls which still occupy a major share
of the unorganised sector, where fast food has been eaten traditionally. However, with the
changes in the economy of the country and injection of modern employment from the
West, the non-home food market has now changed.
The market is highly competitive with a large number of Indian and foreign
players seeking business in this upward trend.
The market is dominated by global players, specially in the organised fast food
segment. Growing trend of consumption of multi cuisines and increasing brand
awareness has led to the increase of global players. Organised modern formats like malls
and supermarkets have also become a favourite destination for the outlets. Larger
companies are teaming up with small franchisors and mall owners to promote their brand.
[33]
The growing segment comprises of formats like fast food chains, cafes and fine
dining restaurants. Two sub segments of the fast food market are the Pizzas and Burgers.
These have now developed into part of the nations eating habits. Their share is
continuously growing with the key global brands such as Dominos, McDonalds and KFC
making their marks quickly. The chains have had no problems accommodating different
menus for the Indian consumer. For example, McDonalds will not sell beef burgers but
instead lamb and chicken burgers and have a larger selection of vegetarian food
compared to the West.
Changing behaviours of the Indian consumer have no doubt contributed to the
success. Some of the brand outlets first started only in major cities such as Delhi and
Mumbai. Now, they are continuously expanding to cities like Pune, Surat, Ahmedabad,
Rajkot, Nasik, Aurangabad, Kolhapur, Chandigarh, Jammu, Chennai, Bhubhaneswar,
Goa and Bangalore, to meet major demand.
The challenges for the new style of Indian restaurants and fast food joints are food
price fluctuations, cumbersome licensing laws, high cost of real estate and lack of skilled
manpower.
Another area experiencing growth is the Ready To Eat (RTE) market in India for
food. RTE can be defined as food products that constitute complete meals; require
minimal processing, if any, typically requiring re-heating to desired temperature or
addition of water. They are often termed as Convenience Food since they are positioned
as value for money products that solve the issue of time-constrains faced by consumers
[34]
due to the pressures of urban life. RTEs are categorised into two product categories Shelf
stable packaged food and Frozen packaged food.
When RTE foods were introduced first in India the concept failed at that time and
has only recently exploded. Changing consumer habits, preferences and perceptions has
driven the market. A strong correlation exists between the growth of RTE foods and
organised retail formats such as supermarkets and hypermarkets. Companies such as Taj
Foods, Sangeeta Foods (Raja Foods), Rajbhog Foods Private Limited are all part of the
Indian RTE industry.
These trends show that the modernisation of India is well on its way. These
changes in the eating habits Indians are more than likely referring to middle class and
upward earning society of India. The prospect of seeing fast food such as burgers and
pizzas being the staple diet for lower classes will not likely be the case, as it is perhaps is
in Western societies, due to the contrast in affordability.
[35]
3.3
Jumbo King is not Gupta's first venture. Shortly after completing an MBA from
Symbiosis Institute of Business Management in Pune, he started Manali Foods to export
sweets to places like Dubai, which have a large concentration of ethnic Indians. It didn't
work. "I suddenly realized I was looking at the wrong market," Gupta says. "There were
800,000 to 900,000 Indians in Dubai; there were 2 million in [the Mumbai suburb] Malad
alone."
Having made a choice about his market, the next key decision was the product.
Gupta's family was in the hotel and catering business and also had run sweetshops. But
sweets had flopped once for Gupta, and he now decided bet on Indian snack foods. He
opened an outlet in Malad under the name Chaat Factory. (Chaat is the Hindi word for
small plates of savory snacks.)
That worked. But Gupta soon discovered that the item on the menu that really
moved was the vada pav. "We decided to stick to that alone," he says. Chaat
Factory became a misnomer. When customers began complaining that there was no chaat
in the Chaat Factory, the name was changed to Jumbo King.
From one outlet in 1990, Jumbo King reached 45 by early this year. It is targeting
250 this year, and has already forayed to Gujarat from its home state of Maharashtra. The
initial investment was Rs. 200,000 ($4,300). Now, the company plans to pump in Rs. 75
crore ($16.1 million) over the next three years. The money will come from private equity.
According to the company's plans, the funds will be used for setting up more
owner-operated outlets (outlets are franchised now), and kiosks within malls, retail chains
and airports. A deal has been signed with Bharat Petroleum for kiosks at gasoline pumps.
And Jumbo King plans to move inside railway stations; talks are on with Indian Railways
for outlets on platforms.
"Jumbo King is a brilliant idea," says Akbar Khwaja, managing director of United
Pizza Restaurants, which has 62 franchised outlets in 26 cities. (Khwaja is planning to
start a chain of franchised fast-food outlets called Satvik, serving "non-messy" items such
as samosas, kathi rolls, paranthas, vada pavs and tikkis.)
"Jumbo King has hit the right chord for Indian fast food," Khwaja says.
"According to a recent survey that [United Pizza] did regarding the top five Indian fastfood items across the cities of Bangalore, Mumbai, Pune and Ahmedabad, vada pav tops
the list, followed by pav bhajji, kathi rolls, samosas and pakodas."
According to a 2004 online survey by ACNielsen, the marketing information
company, India ranks high in fast-food consumption. The survey showed that 37% of the
population ate at takeaway restaurants at least once a week. That was seventh globally
and above the United States, at 35%. Of course, the U.S. market size is far greater, given
price differences, but the trend is clear. "It doesn't matter where in the world you are or
how well off, the fast-food culture has become a way of life for all of us," the Nielsen
report says.
[38]
For Jumbo King, striking the right lode doesn't translate into operating a gold
mine. Although mark-ups in the restaurant business can be as high as 200%, overhead is
challenging. "Our margins are barely 10% to 12%," Gupta says. "But that's healthy."
Jumbo King made money from the first year, because it pared costs to the bone.
"Initially, there was just my wife, a five-man crew and myself," Gupta says. Today, he has
30 people, including three in Gujarat. The outlets have their own staff.
"One of our first lessons was getting our target clientele right," Gupta says. He recalls
opening a store in Masjid Bunder, an area classified as SEC C, a low socioeconomic
classification that accounts for 21% of the urban population. More than 50,000 people
went past the store every day, "but hardly any customers. It was a disaster. We found that,
while we expected to reach SEC C, 75% of our customers were actually SEC A."
mouth," he says. His wife, Reeta, was freelancing for certain newspapers around that time
and persuaded friends in the media to write about Jumbo King. She says, "I found that the
concept of hygienic vada pav was the subject of some curiosity. So my friends helped me
give some initial news value to Jumbo King. After that I took care of marketing."
Reeta, a Symbiosis alumna, has since stepped out of an active role in the business.
"[Following] our MBA, we had become a joke when we started Jumbo King. People said,
'You are MBAs competing with roadside vendors.' I had to be supportive. From selling
vada pavs physically at the counter to filling feedback forms at railway stations, I got my
hands dirty at every stage."
Today, Reeta is a sounding board for her husband while she tends to her own PR
firm. The mom-and-pop operation has grown to a point where it needs to professionalize,
so Jumbo King has brought in a professional CEO, Karandeep Singh, from Caf Coffee
Day. "My mandate is to make Jumbo King India's largest [quick service restaurant] chain
in the next few years," Singh says. Other professionals have also come on board.
The expansion drive brings tough work, starting with getting the menu right. As many
multinational chains have belatedly realized, the Indian food market is fragmented. What
works in one state may not in another.
Jumbo King has already experienced that. In Gujarat, there are some items in addition to
vada pav on the menu. Gupta justifies the variety. "In its formative years, McDonald's
tried their new products in one location," he says. "If it worked, it was introduced all
over. The Butter Jumbo King, first launched in Gujarat, is now available in other places."
[40]
The menu will change and perhaps expand, for Gupta doesn't see his business as just
selling vada pav. "We are in the business of catering to people on the go," he says.
Besides, the vada pav that Jumbo King serves is different from the one it competes with
in the streets of Mumbai. For one, it is larger. The bread is round. (The standard pav is
square.) And the vada itself is flat instead of round.
India's Standardization Challenge:
The McDonald's recipe for success is standardization. Is that possible in India?
Bijoor thinks it will be difficult. "Take the taste of the humble samosa," he says. "Every
region and indeed every town of India has its own samosa with a taste all its own.
Arriving at the true-blue national samosa is a game of lowest common denominator taste
management. When a national player puts it together, he puts it with the lowest common
taste acceptance parameters of the people of all regions. What emerges is what I call the
ration-shop samosa. The taste is acceptable, but it is not a taste to kill for. Local players
are able to offer this. It is possible to go national with brands of snacks such as the
samosa, but the approach needs to be as localized as possible, with local kitchens and
local recipes that differ city to city. Recipes have to approach the highest common
denominator taste palates of each city and not the LCD palates."
Khwaja of United Pizza disagrees. "Different tastes in food is certainly not an
issue," he says. "There are items which are popular all over. If McDonald's can come and
sell a concept like burgers to Indians across the country, why can't Indian food do well?
The time is now ripe for Indian fast-food chains to catch on because the Indian middle
class is getting more brand-conscious."
[41]
[42]
Gupta says finding private-equity funds won't be a problem. But what will make
or break the chain is this, according to Khwaja: "Indian fast-food chains have not caught
on because of the mind-set of Indian entrepreneurs. They under-invest and expect quick
profits. Indians typically like to have complete ownership of their business, and so we
end up having small companies. In the chain-food business one needs to have long-term
vision and large investments."
"The absence of Indian fast-food chains is not because of differences in taste or
food habits," says Bidisha Nagaraj, Caf Coffee Day's president of marketing. "The entry
barrier is not so much the palate as the investment that is required. Rentals themselves are
a huge cost. If one is looking at a chain of 100 outlets, it can be a huge amount for a small
entrepreneur to invest."
"Jumbo King has a great product and a great concept," she adds. "What it needs to
do is to work on its distribution model. It needs to look at being present in places like
cinema halls, food courts of shopping malls, railways stations and airports. As there is
only one product, they can also look at backward integration to bring about more
economies of scale."
Jumbo King may sell just vada pav. But, in terms of management strategies and
decisions, it has a lot on its plate.
[44]
Franchise Information:
Master Franchises
Jumboking is presently looking for master franchisees who can invest into
8 to 10 outlets at a time. Please contact us for more information.
Testimonials
''On my visit to Mumbai in 2004 I saw a Jumboking Vada Pav being served. I was
surprised and fascinated to know that it was our own local street food VadaPav prepared
in a very hygienic condition and wrapped in food grade paper as burger. This was the day
which saw the start of revolution in fast food chain Jumboking, culminated in national
growth and poised for international expansion. Today I have first Jumboking outlet in
[46]
Akruli-Kandivali, second in Bazar gate-V.T and third upcoming outlet at Thakur VillageKandivali, Mumbai.
Mr. M Mody, Successful and proud franchisee of Jumboking. He is also a
franchisee of Blimpy sandwiches in USA.
Recruitment Process:
All Mumbai and Thane based enquiries are called to Mumbai Office for
Jumboking presentation. Shortlisting is done for a second round where prospective
franchisees are given details of project profit and loss account. In third round M.O.U is
signed and franchisee is given hand book detailing how to make Jumboking outlet
operational. For outside Mumbai/Thane a presentation is given in respective cities, then
second follows and third round will be conducted in Mumba
[47]
[48]
Fast food is one of the worlds largest growing food type. Indias fast food
industry is growing by 40% a year and is expected to generate a billion dollars in sales by
2005.The multinational segment of Indian fast food industry is up to Rs. 6 billion, a
figure expected to zoom to Rs.70 billion by 2005. By 2005, the value of Indian dairy
products is expected to be Rs.1, 00,000 million. In last 6 years, foreign investment in this
sector stood at Rs. 3600 million which is about one-fourth of total investment made in
this sector. Because of the availability of raw material for fast food, Global chains are
flooding into the country.
MCDONALDS
KFC
PIZZA HUT
[49]
DOMINOS PIZZA.
COFFEE DAY
BARISTA.
The main reason behind the success of the multinational chains is their expertise
in product development, sourcing practices, quality standards, service levels and
standardized operating procedures in their restaurants, a strength that they have
developed over years of experience around the world. The home grown chains have in the
past few years of competition with the MNCs, learnt a few things but there is still a lot of
scope for improvement.
[50]
3.5 DOMINOS
used to be in metros and mini-metros, now the ratio is 50:50 between big cities and
smaller Tier II and III cities. Dominos Pizza is expanding its base in India by opening
500 outlets to add to its current tally of 156 outlets, across 50 cities in India by 2011 with
an investment of Rs.1, 000 crore.
Market strategies:
Promotional and Advertisement Campaigns(Coupons and discounts)
Market share:
The organized pizza market in India is worth Rs.500 crore and Dominos has a
substantial 45% market share, and registered a healthy growth of 60% over last year. The
[52]
main target for new outlets shall be metro cities though Tier II cities would also receive a
fair amount of attention. Currently Dominos sells around 35,000 pizza every day, of
which around 1% are given free on account of its 30 minutes or free model. 65 percent
of its revenue comes from home delivery service; around 35 percent is from sales in
premise.
Competitors:
Fast food is one of the world's fastest growing food types. It now accounts for
roughly half of all restaurant revenues in the developed countries and continues to expand
there and in many other industrial countries in the coming years. But some of the most
rapid growth is occurring in the developing world; where it's radically changing the way
people eat. People buy fast food because it's cheap, easy to prepare, and heavily
promoted. This paper aims at providing information about fast food industry, its trend,
reason for its emergence and several other factors that are responsible for its growth . India
is a developing country with
most of the fast foods came into Indian market as India has a high growth in every sector.
Some of the competitors of dominos are
McDonald's
Pizza Hut
Barista
Coffee Day
[53]
worse, merely thrown on the ground. This burdens nature unnecessarily and
squanders raw materials. In order to reduce soil and water pollution, government
now emphasis more on the usage of bio-degradable products.
Increase in Chinese Food stalls: There are large numbers of Chinese food stalls
are present in India and they are increasing day by day. It is becoming a big
challenge to Indian fast food industry.
[55]
I.
Studies have shown that a typical fast food has very high density and food with
high density causes people to eat more then they usually need. \
II.
Low calories food: Emphasis is now more on low calorie food. In this line
McDonald has a plan to introduce all white meat chicken Mcnuugget with less fat
and fewer calories.
Changing trends
Changing consumer preferences.
Underdeveloped Infrastructure.
Low level customer commitment: Because of the large number of food retail
outlets and also because of the tendency of customer to switch from one product to other,
this industry faces low level customer commitment.
[57]
Attracting different segments of the market: Fast food outlets are introducing
varieties of products in order to cater the demands of each and every segment of the
market. They are introducing all categories of product so that people of all age, sex, class,
income group etc can come and become a customer of their food line.
The success of fast foods arose from the changes in our living conditions:
[58]
3.9 Indian Fast Food Industry growth and its important Players
With the rapidly growing middle class population and changing lifestyle, India
is blessed with one of the fastest growing fast food markets in the world. The
Indian fast food market is growing at an annual rate of 25-30%. Almost all the
worlds big fast food brands have succeeded in making their presence felt in
the country and most of them are posting appreciable growth.
Consequently, all the popular fast food chains have chalked out massive
plans for expanding their business and presence throughout the country.
Foreign fast food chains are aggressively increasing their presence in the
country. For instance, Dominos has planned to open 60-65 outlets every year
for the next three years (2010-2012) while Yum Brands Inc is also preparing
for massive expansion across the country with plans to open 1000 fast food
outlets by 2015.
According to our new research report Indian Fast Food Market Analysis,
although the market has witnessed robust growth over the past couple of
years, it remains largely underpenetrated and concentrated in metropolitan
cities. However, there is a large room for growth in untapped tier-II and tier-III
cities. Therefore, the future of the Indian fast food industry lies in tier-II and
tier-III cities. Owing to this, major fast food retailers are on the way to market
their brands by using different marketing strategies such as campaigns and
putting up billboards in tier 2 and tier 3 cities.
The report provides an extensive research and objective analysis of the fast
expanding Indian fast food market. The report analyzes all the vital industry
trends and possible growth areas for future expansion. It also analyzes
important driving forces in detail, which will help clients to understand the
market better.
Moreover, we have identified the important players operating in the sector
and have made a separate chapter which talks about their business
expansion plans in detail. Most importantly, the report features forecast for
fast food sales in the country. The forecast is based on the correlation
between past market growth and growth in base drivers such as middle class,
urbanization, cultural shift and lifestyle changes.
[59]
[60]
As per our research report Indian Fast Food Market Analysis, India has seen
a massive rise in the consumption of fast food over the past few years. In fact, the country
has emerged as one of the fastest growing fast food markets in the world. Improving
living standards, rapid urbanization, and westernization of Indian culture are some of the
major factors responsible for such a robust growth. These factors and several other
factors will help the industry to grow at a CAGR of 30-35% during 2010-2013.
Although the market has witnessed a robust growth in the past few years, the
market largely remains underpenetrated. The market largely remains concentrated in the
metropolitan and Tier-I cities, while Tier-II and Tier-III cities as well as rural areas
remains mostly untapped. However, all the major food chains have started realizing the
potential of these untapped markets and are trying to increase their presence in Tier-II and
Tier-III cities.
According to our research, pizza, pasta and noodles market along with other fast
food markets are expected to get double in 2013 compared to 2010. Owing to this trend,
nearly all major international fast food players, such as McDonald, Pizza Hut, Dominos,
KFC, etc. are investing huge amount of money to expand their presence and share in the
highly lucrative Indian fast food industry. Customization of products, considering Indian
choices and customs, has been one of the key strategies for the success of foreign fast
food chains in India. Most of the food chains are busy in innovating and customizing
their products.
Although the multinational fast food restaurants have made strong presence and
are found at almost every shopping malls and local markets, they are facing stiff
[61]
competition from ethnic eateries/fast food chains that sell traditional items such as Wada
Pav, Kaati Rolls, Kulfi, and Tikka. Though these restaurants are not big ticket like their
foreign counterparts, they are fast becoming a part of day-to-day life of urban India.
Fast-food restaurants seem to be big business in India, and so a many foreign
chains have made an entry into the market to joint the early movers like McDonald's or
KFC. On of the last entrants is Bembos, and that chain from Peru will not be the last one.
Now ITCOT, a Chennai based, banks-promoted consultancy has presented the
updated version of a Feasibility Report on Fast Food Restaurants which has first been
published in 2002. After an overwhelming response, so ITCOT, a revamped version was
released in 2008 so to provide the latest statistics and information to entrepreneurs about
the fast-food restaurant segment.
The report covers both pure vegetarian and multi-cuisine type fast food
restaurants which are classified into different types in the first chapters, including a
history of the hamburger. The main focus of the report is on explaining franchise
models and cost aspects of a fast-food venture, introducing necessary controlling tools,
among them financial ratios, projected profitability or projected cash flow.
Regarding locations, for example, the report notes that the top five foreign brands,
namely, McDonalds, Dominos Pizza, Pizza Hut, Subway, and Pizza Corner would be
focused on New Delhi, Mumbai, Bangalore and Chennai which account for 53% of their
total number of outlets.
The principal factors that drive the demand for fast food restaurants would be the
increasing disposable incomes among the target groups, increase in working women,
[62]
urbanization, globalization, the consequent changes in life styles, and the brand pull,
ITCOT says, but informs also that there would be no authentic estimates of demand for
fastfood products in India.
According to Down to Earth (March 2008), Indians would spend close to Rs
4,449 crore a year (approx. 767 million) at fast-food joints. The fast-food market would
be growing at 40% per year. If one would assume a modest growth of 30% only, so
ITCOT, then the business potential for fast food restaurants in the country may be
reckoned at Rs.13,580 crore by 2011-12.
Indian Fast Food on High Growth Trajectory:
12 Aug 2010 - New Delhi, India - As per our new research report, Indian Fast
Food Market Analysis, India has seen a massive expansion in consumption of fast food
in recent years. In fact, the country has emerged as one of the fastest growing fast food
markets in the world. It has been found in our research that growing number of nuclear
families, rising numbers of women employees and intensifying exposure to western food
are driving the eating out trend in India that has resulted in growth of fast food industry.
Further with increasing wealth of prospective customers in Tier 2, Tier 3 cities, demand
for fast food is expected to grow at a faster pace in near future. As a result, Indian fast
food industry is expected to grow at a CAGR of 30-35% during 2010-2013.
According to our new research report, major international fast food chains present
in India have now well understood the market potential in untapped Tier 2, Tier 3 cities
and rural areas and have now started making investment to serve the growing numbers of
prospective fast food customers into these untapped areas. The report has identified
[63]
various other factors such as changing life style and westernization of Indian culture that
are further expected to fuel growth in Indian fast food Industry.
The research report has covered the important fast food segments such as Pizza,
pasta and noodles, etc and studied the consumption pattern in each segment extensively.
The report also provides the emerging trends in Indian fast food market and identifies the
potential growth areas for future expansion.
A descriptive research design was adopted to do the survey with the help of the
questionnaire. The study used non probability convenience sampling. The methodology
of study is the interview method survey. The study is completely based on the primary
data which is collected from different Fast food stores and the sample size taken for study
is 100 people.
[64]
The interview is conducted for about 15 minutes with each person and collected
the data. The tool for the collection of data is a questionnaire. The questionnaire has 15
questions.
The data processing consists of coding the data collected in the form of
questionnaire. The data collected with the help of questionnaire is having the closed
replies. One open ended replies have been taken for that if any problems they are facing
and for the close ended the replies are measured using scales.
14
[65]
Weekly
38
Fortnightly
19
Monthly
Total
100
visit
38
40
35
30
25
20
15
19
14
9
10
5
0
Daily
Weekly
Fortnightly
Monthly
Interpretation: - From the above table and graph, it says that majority of the
customers visit the fast food retail store weekly (i.e. 38%) and minority of them
(19%) visit fortnightly
2) PRICE RANGE
Range
Frequency
[66]
100-200
24
200-500
60
Above 500
16
Total
100
price range
70
60
50
40
30
20
10
0
100-200
200-500
Above 500
Interpretation:-From the above table and graph, it says that majority of the customers are
willing to spend money of price range 200-500 (i.e. 60%) and minority of them says that
they will spend money of price range 100-200 (i.e. 24%) in the fast food retail store.
3) Preference
[67]
Frequency
Brand image
21
Easy
accessibility
29
Special offer
50
Total
100
preference of store
60
50
40
30
20
10
0
Brand image
Easy accessibility
Special offer
Interpretation:-From the above table and graph, it says that majority of the customers (i.e.
50%) prefer special offers in the store and minority of them (i.e. 29%) prefer easy
accessibility
[68]
4) Visiting hours
Frequency
Morning
40
Afternoon
29
Evening
31
Total
100
45
40
35
30
25
20
15
10
5
0
Morning
Afternoon
[69]
Evening
Interpretation:-From the above table and graph it says that majority of the customers are
willing (i.e. 40% ) to visit the store on morning session and minority of them (i.e.31% )
of them visit the store on evening session
Response
Frequency
Strongly disagree
Disagree
Neutral
44
Agree
40
Strongly agree
Total
10
0
50
45
40
35
30
25
20
15
10
5
0
Strongly agree
Disagree
Neutral
[70]
Agree
Strongly agree
Interpretation:-From the above table and graph it says that majority of the customers (i.e.
44%) of them are neutral to prefer the store for friendliness of staff and minority of them
(i.e. 40% ) of them agree that they will prefer the store for friendliness of staff.
Response
Frequency
Strongly Disagree
Disagree
15
Neutral
21
Agree
39
Strongly agree
15
Total
100
[71]
Disagree
Neutral
Agree
Strongly agree
Interpretation:-From the above table and graph it says that majority of the customers ( i.e.
39%) of them agree that they will prefer the store due to the variety of menu and minority
of them (i.e. 21% ) of them neutral about the variety of menu in the store
7) Preference of store due the service speed
Response
Frequency
Strongly disagree
Disagree
20
Neutral
39
Agree
15
Strongly agree
20
Total
100
[72]
Disagree
Neutral
Agree
Strongly agree
Interpretation:- From the above table and graph it says that majority of the customers
(i.e. 39%) are neutral about the preference of store due to service speed and minority
of them are disagree that (i.e. 20%) of them prefer the store due to service speed
8) Preference of store due to good calorie content exist in the food
Response
Frequency
Strongly disagree
Disagree
33
Neutral
19
Agree
31
Strongly agree
20
Total
100
[73]
Disagree
Neutral
Agree
Strongly agree
Interpretation:-From the above table and graph it says that majority of the customers (i.e.
33%) of them disagree that they will prefer the store due to the calorie content in the
food and minority of them (i.e. 31%) agree that they will prefer the store due to the
calorie content in the food.
9) Preference of store due to the cleanliness and store atmosphere
Response
Frequency
Strongly disagree
Disagree
Neutral
25
Agree
40
Strongly agree
26
[74]
Total
100
Disagree
Neutral
Agree
Strongly agree
Interpretation:From the above table and graph it says that majority of the customers (i.e.
40% ) of them agree that they will prefer the store for ambience provided in the store.
10) Preference store due the delivery speed offer by the store
Response
Frequency
Strongly disagree
Disagree
20
Neutral
15
Agree
41
[75]
Strongly agree
20
Total
100
Disagree
Neutral
Agree
Strongly agree
Interpretation:- From the above table and graph it says that majority of the customers (i.e.
41%) of them prefer the store due to delivery speed that is offered.
Response
Frequency
Strongly disagree
Disagree
16
Neutral
34
[76]
Agree
35
Strongly agree
Total
100
Disagree
Neutral
Agree
Strongly agree
Interpretation:- From the above table and graph it says that majority of the customers
(i.e. 35% ) of them agree that they are satisfied with the menu that was offered in the fast
food store and followed by some of them are neutral about the menu for their family.
12) Preference of store due to facilities offered
Response
Frequency
Strongly disagree
11
Disagree
20
[77]
Neutral
41
Agree
14
Strongly agree
14
Total
100
Disagree
Neutral
Agree
Strongly agree
Interpretation:- From the above table and graph it says that majority of the customers
(i.e. 41% ) of them says that they are neutral about preferring the store due to the
facilities.
Response
Frequency
[78]
Strongly disagree
Disagree
18
Neutral
15
Agree
45
Strongly agree
15
Total
100
50
45
40
35
30
25
20
15
10
5
0
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
Interpretation:- From the above table and graph it says that majority of the customers
(i.e. 45%) of them agree that they will prefer the store due to easy accessibility and
locational advantage.
14) Advertising strategy
[79]
Response
Frequency
Strongly disagree
Disagree
20
Neutral
33
Agree
28
Strongly agree
10
Total
100
35
30
25
20
15
10
5
0
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
Interpretation:- From the above table and graph it says that majority of the customers
(i.e. 33%) of them are neutral about the advertising strategy provided by the store and
followed by that customers agree the store for the advertising strategy.
[80]
Response
Frequency
Strongly disagree
Disagree
20
Neutral
15
Agree
41
Strongly agree
20
Total
100
45
40
35
30
25
20
15
10
5
0
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
Interpretation:- From the above table and graph it says that majority of the customers
(i.e. 41% ) agree that they will prefer the store because of special offers and
discounts.
[81]
This study indicates that majority of the customers visit the fast food retail store
weekly (i.e. 38%) and minority of them (19%) visit fortnightly
This study indicates that majority of the customers are willing to spend money of
price range 200-500 (i.e. 60%) and minority of them says that they will spend
money of price range 100-200 (i.e. 24%) in the fast food retail store
This study indicates that majority of the customers (i.e. 50%) prefer special
offers in the store and minority of them (i.e. 29%) prefer easy accessibility
This study indicates that majority of the customers (i.e. 44%) of them are neutral
to prefer the store for friendliness of staff and minority of them (i.e. 40% ) of
them agree that they will prefer the store for friendliness of staff
This study indicates that majority of the customers ( i.e. 39%) of them agree that
they will prefer the store due to the variety of menu and minority of them (i.e.
21% ) of them neutral about the variety of menu in the store
This study indicates that majority of the customers (i.e. 33%) of them disagree
that they will prefer the store due to the calorie content in the food and minority
of them (i.e. 31%) agree that they will prefer the store due to the calorie content
in the food
[82]
This study says that majority of the customers (i.e. 40% ) of them agree that they
will prefer the store for ambience provided in the store
This study says that majority of the customers (i.e. 35% ) of them agree that they
are satisfied with the menu that was offered in the fast food store and followed by
some of them are neutral about the menu for their family
This study indicates that majority of the customers (i.e. 45%) of them agree that
they will prefer the store due to easy accessibility and locational advantage
This study indicates that majority of the customers (i.e. 33%) of them are neutral
about the advertising strategy provided by the store and followed by that
customers agree the store for the advertising strategy
This study indicates that majority of the customers (i.e. 41% ) agree that they will
prefer the store because of special offers and discounts.
[83]
As majority of customers (38 percent) visit the store weekly especially weekends.
So it is suggest to stores give special offers and discounts to capture more
customers and retain loyal customers.
As study refers more customers are looking for the special offers ,so it suggest
stores to more concentrate on the special offers but no compromise in the quality
of food.
It is found that majority of customers are not fully satisfied with the friendliness
of staff. So it is suggest that the stores should conduct soft skill training and make
[84]
them give more customer service .Regular monitoring of the staff behavior
towards customers is also suggest here.
Customers are happy with the MENU verities available in the stores .But it is
suggested that add more customized menu and review the menu for every 3
months.
As study shows that customers are not aware of the calorie contents exist in the
food. So it is suggest that stores should display the calorie contents available in a
particular food.
Advertising strategy of the stores are not making attention the customers .So it is
suggest the stores to think of the design of different innovative advertising
campaigns.
WORK DONE
[85]
[86]
6.1 Summary
On 16 November 2010, I visited the fast food restaurant of Jumbo King at Sanpada,
Plot no.24, Sector-30.Navi Mumbai.
The restaurant is exactly opposite to the railway station of Sanpada. The place of the
restaurant is not that big but we can stand outside and have a tasty vada pav.
Then, I met some employees of Jumbo King. There are 3 people working at that time.
They all are making the vada pav and also serving to the customers.
Then I met the store manager Mr. Rakesh Kumar age: 30, working for Jumbo King
from last 3 years. I asked him some questions to him related to Jumbo King and also
fast food industry of India. Mr. Rakesh Kumar answered my every question very nicely.
Following is the analysis of answers given by him.
Mr. Rakesh Kumar stated that the fast food industry in India is very fast growing. There
is very bright future to this industry thats the main reason he entered in this industry.
He also mentioned that Jumbo king Pvt. Ltd. is also having great strategies for future &
they want to increase their market share.
The Reason for opening of franchisee of jumbo king at Sanpada is to cover more
market. Jumbo King is having many restaurants in the Mumbai but there was no
restaurant of Jumbo King at Navi Mumbai. There are lots of people in Navi Mumbai
who love Jumbo Kings vada pav. So for them they started their franchisee at Sanpada.
Mr. Rakesh Kumar mentioned that Indian fast food industry is a very big industry, there
is vast variety of foods in India and also Indians love to eat different kind of foods. So
that there are many foreign fast food restaurants coming to India and also there is high
growth in local restaurants. So there is very cut throat competition in this industry, but
the restaurant who is serving good quality food can survive for longest and Jumbo King
is one of them.
He also mentioned that the food at Jumbo King is very healthy; the pav is made in very
hygienic condition also other items are also made in healthy environment. This is the
USP of Jumbo King.
There are five employees at Jumbo King Sanpada and two managers, they all are
working in two shifts from 10-4 and 4-10.They all are well educated and also they had
training for one month before joining the restaurant. The employees are well trained
about how to talk and behave with the customer. Thats why the relation with the
customers is very good.
Jumbo King Sanpada have regular rush of people as there are lots of people coming
everyday but during morning 10-12 and evening 4-8 there is very high rush, but the
[88]
employees at Jumbo King are very well trained so they treat every customer very well
at each time. Thats the reason there are many customers who regular to the restaurant.
Some of them come daily twice a day. This proves that the relation between Jumbo
King and customer is very well.
Jumbo King do not have different strategies at different time and days as they have
large variety of vada pav and beverages. The franchisee at Jumbo King Sanpada is
working quite well having a very bright future. So, they are going to increase the space
of store.
As stated by Mr. Rakesh Kumar they are having some future plans such as to increase
timings and variety of vada pav. Also they are trying to include different beverages.
So, Jumbo King Pvt. Ltd. is very good at its quality and customer relation also they are
having great future plans to improve it. They are setting a standard for fast food
industry.
This is the analysis of the interview of Mr. Rakesh Kumar Jumbo King.
Wishing Best of Luck to them for their future
Stage 4: 2018-2025
The industry will begin to make larger internal and external business decisions.
The food at fast food establishments will all be brought to an acceptable level of
nutrition value.
By 2025 the fast food industry will have transformed from a food provider
to one that serves a specic health benet.
The balancing of the food will allow people to eat fast food meals and gain
a balanced diet from every menu. One way to achieve this transformation
is vitamin burgers.
The fast food industry will give importance to taste and health.
Conclusion
Fast food is one of the worlds fastest growing food types. India is seeing rapid
growth in the fast food and restaurant industries. It now accounts for roughly half of all
restaurant revenues in the developed countries and continues to expand. The trend is
radically changing the way people eat in India.The fast food industry in India has evolved
with the changing lifestyles of the young Indian population. It may take some time for the
local enterprise to mature to the level of international players in the field.
Indias fast food industry is growing at 40% per annum and generates over Rs.
4800 crores in sales. The multinational segment of the industry generates over Rs. 7000
crores. The main reason behind the success of the multinational chains is their expertise
[92]
Coca-Cola sells more than 300 drink brands in over 200 countries and employs
60,000 people in Africa alone. Its net revenues reached $19.6 billion in 2002
with more than 70 percent of its income originating outside of the United States.
Chapter 8. Appendices
8.1 Bibliography
1. www.google.com
2. www.indianfastfoodindustrty.net
3. www.scribd.com
4. www.wikipwdia.com
[94]
8.2 Questionnaire
Questionnaire for Manager:
1) Why you entered in this industry?
2) Why you decide to open this franchisee at Sanpada?
3) Describe the Indian fast food industry?
4) Is your all food items are healthy?
5) What are the expectations of customers?
6) How many workers are under this franchisee?
7) Do you gave some training before joining the work here?
8) How the persons handle the customers problems?
9) What is the timing of this franchisee?
10) How is the relation you having with the customers?
11) How many customers are regular?
12) Is there always a rush at your store or at specific timings?
13) Do you have different strategies for weekends?
a. Yes
b. No
14) If yes then what?
15) What are the different strategies do you have for this particular franchisee?
16) What do you think future of your franchisee at Sanpada?
[96]
8) Do you prefer a fast food restaurant due to good calories content exist in food?
a. Strongly disagree
b. Disagree
[97]
c. Neutral
d. Agree
e. Strongly agree
9) Do you prefer the fast food restaurant due to cleanliness and store atmosphere?
a. Strongly disagree
b. Disagree
c. Neutral
d. Agree
e. Strongly agree
10) Do you prefer the fast food restaurant due to delivery speed offer by them?
a. Strongly disagree
b. Disagree
c. Neutral
d. Agree
e. Strongly agree
11) Do you prefer the fast food restaurant due to menu offer for family ?
a. Strongly disagree
[98]
b. Disagree
c. Neutral
d. Agree
e. Strongly agree
12) Do you prefer the fast food restaurant due to facilities offered?
a. Strongly disagree
b. Disagree
c. Neutral
d. Agree
e. Strongly agree
13) Do you prefer the fast food restaurant due to easy accessibility and locational
advantage?
a. Strongly disagree
b. Disagree
c. Neutral
d. Agree
e. Strongly agree
14) Do you choose a fast food restaurant after watching its advertisement?
[99]
a. Strongly disagree
b. Disagree
c. Neutral
d. Agree
e. Strongly agree
15) Do you choose a fast food restaurant due to special offer and discounts ?
a. Strongly disagree
b. Disagree
c. Neutral
d. Agree
e. Strongly agree
[100]