L/O/G/O

by Asha Sharma Subhamoy Sanyal Zeeshaan Iqmar AhmedProsenjit Chakraborty Priyanka Roy

Entrepreneurship & Small Business ManagementEntrepreneurship & Small Business Management

IT’S ALL ABOUT MONEY, HONEY IT’S ALL ABOUT MONEY, HONEY

Nirmal Jain came from a family of commodity traders. After completing his post graduation from IIM Ahmedabad, he decided to start his own venture rather than take up a job in the corporate world. Starting Probity Research, an equity research firm, really paid off. The nineties was the time the Indian masses had discovered the stock exchange as an investment vehicle and they needed all the advice they could get to understand this uncertain environment. By 1999, Probity Research had a turnover of almost one crore and things were looking good. But Nirmal was not happy as he wanted to try for something much bigger.

1) Do you think Nirmal Jain took a gamble by starting Indiainfoline? Nirmal Jain made the biggest gamble of his life in 1999, when

he was running Probity Research, a stock market research firm with revenues of nearly Rs 1 crore. But Jain was dissatisfied. A steady but small business was no fun. So, he took the huge volumes of research data, their chief source of revenue, and put it on the Internet. Convinced that it was a foolish move, many of his core team members quit. But Jain had just discovered the power of the Internet. It offered him a bigger scale than his firm could ever reach otherwise. Thus, India info line was born in May 1999.

Nirmal Jain took the gamble for a variety of reasons ; some of them are listed below: Control : He wanted to be his own boss and make his own decisions.

The Idea: He passed out from IIM Ahmedabad which proves that he could have easily got some job with high salary and live a safe and secure life. He also had a family business of commodity trading , which he happily opted not to join. All this is because he had an idea which he felt can rock the world.

Flexibility: He is a entrepreneur who devoted time to only one venture at a time & focus on the product by spending more time on the job.

Three decisions are crucial to start a business which Mr. Nirmal Jain did carefully. Decisions are as follows ;

Three decisions are crucial to start a business which Mr. Nirmal Jain did carefully. Decisions are as follows ;

Choosingthe marketChoosingthe market Timing of entryTiming of entry Scale of entry Scale of entry

Any successful business

1] Choosing the market: He segmented his market in to two ways; educated people who can do business through internet and uneducated people who can do business by making calls to the company.2] Timing of Entry : He knew that the timing of his business has come .i.e. the perception of people of India is changing and at the same time government is also taking initiatives to develop this sector.

3] Scale of Entry : He also chose this very smartly.

social

economic

political

technical

Change in technology ; this is the reason why his business expanded within short span of time

Change in perception : the

perception of the people of India

changed for investing & the

savings increased as well.

o Level of savings.o Monitory policy

o Fiscal policy

o Ideology of government.oStability of GovernmentoForeign Policy of Government

PEST ANALYSIS OF INDIA INFOLINE

2) What are the external factors at work which prompted Nirmal Jain to take the plunge?

Industry Structure:New Technologies:Formation of New Business Communities:Increasing Demand for Variety:Government Incentives & Subsidies:Increasing Flow of Information:Easier Access to Resources:Entrepreneurial Education: High Regards for Self-Employment:Rising Dissatisfaction of Job:

Edward De Bono Six Hat

Green hat -- creativity and innovation

Yellow hat – positive thinking

Nirmal Jain wears Green hat of Edward De Bono Hat and he also wears Yellow hat is positive thinking.

One of the most important external factor for the success of India infoline are the qualities of Nirmal Jain : Ambitious Risk taker

Flexibility

Vision and Foresight

Early starter

Enthusiastic & passionate

Chulha, a division of Purnima Viands Pvt. Ltd. is Bangalore based tiffin-service provider.Just like any dream, Chulha also started small as a simple localized dabbawala providing cooked food in steel containers to a small part of Bangalore.Chulha is a partnership venture taken up by Adesh and Nishant. After completing their MBA, Adesh and Nishant got jobs in the IT sector and were based in Bangalore. Nishant was from Delhi and Adesh was from Kolkata. Both were missing home-cooked food and found the offering from the office canteen to be highly unappetizing. At this moment they came up with this unique concept of Chulha delivering home-cooked to all the working personnel. They found certain gaps in the current local tiffin service providers and accordingly they shaped up their project. They tried to bridge the gaps by introducing feedback mechanism, maintaining high quality food and using website as their important marketing tool.

Its main aim or mission is to ensure food being served to customers not just in terms of taste but variety and maintain quality standards, and gaining recognition in this business. It is practically serving hygienic and delicious food.

Mission of ChulhaMission of Chulha

Goals & Objectives

Full Tiffin Menu :

ROTIS RICE DAAL 2 VEGETABLES SALAD PICKLE MOUTH FRESHNER

Mini Tiffin Menu :

PARANTHAS & RAITA BIRYANI PURI & CHANA SOUP & CHOWMEIN

The Price Of the Meal are as follows :With all these extra services that they are planning on providing, they feel they can charge a premium. Currently, the usual rate for a veg tiffin is Rs. 30. With the average cost of a vegetarian tiffin at Rs. 15, they can afford to charge the same as others but they decided to go with a slight premium. Veg meal @ Rs. 35

Non-veg meal @ Rs. 45Their justification is that the average IT professional will be willing to spend a little more for better food.

Individuals & Specially for working individuals accommodations

Target Customers

DELIVERY AREAS ACROSS BANGALORE :

DomlurAirport RoadIndira NagarKodihalliJivan Bima NagarMurugeshpalyaThippasandraComing very soon inKoramanglaNGV

Corporate Houses

Party orders& Guest houses

Past: No other quality food and delivery service provider was present.

Present: Chulha’s aim was providing quality food & services in an affordable price. Providing customers with high satisfaction aimed for a long term business.

Future: Constant need for improvisation and newness as threats of new entrants are always there.

An overview of the market scenario

MARKET SCENARIO ...

Competitions ….

o The business was started in April 2007 when it was the sole tiffin service in Bangalore and forced no competition.

o It Began achieving customer satisfaction/recognition and loyalty – soon became a household name.

o Since competition was less, charging customers a premium price for the food service seemed appropriate

o But it has to keep in mind the competitions as newer tiffin services are coming up

PESTE ANALYSISPESTE ANALYSIS

Economical

Political

Environmental

Technological

Social

Taste of food is different.

Since Bangalore is a true cosmopolitan city, it has people from different parts of India. So in order to cater to the tastes and demands of non-locals, Chulha plans to serve cuisines from other states to satisfy its customers.

Ordering of foods online along with dedicated feedback methods through official website.

Aim to optimize for different search engine.(e.g.; Google).

Ecofriendly chimneys, Chula etc.

Providing Value for Money is the aim

of Chulha, keeping operational costs

low and moreover price of food is least effort by

economic conditions in the

country- Recession or

Inflation Not applica

ble Inspectors

to be appointed

to check level of

pollutions and proper disposal of

waste by the

municipality.

Research to use

renewal source of

energy.

SWOT AnalysisSWOT Analysis

Customer SatisfactionVariety of food being served to satisfy the needs of a large customer base including locals & non- localsAffordable Range of PricesEffective delivery system, innovative serviceTechnological changes being implemented

Limited service only in Bangalore.

Less knowledge of non- local foods

To expand its business, operating all over the India

Because of its recognition its getting its due share of publicity

Can tie up with Franchises

Can open their own cooking school.

Weakness OpportunityStrength Threat

A large number of customers are taken by different canteens, fast food chains and other hotels.

Porter’s 5 forces TheoryPorter’s 5 forces Theory

Bargaining Power of Buyers

Bargaining power of Suppliers

Degree of rivalry

Threat of substitutes

Threat of new entrants

Bargaining power of buyers

As its main customers are IT professionals where salary varies from Rs-25000 to Rs-30000 and above in a month, spending Rs-850/- on food where quality is good so here the customers usually could not bargain.

On getting party orders in corporate, customers can opt for schemes such as on billing of Rs-500 or more, a discount of 5% is awarded to the customers.

If these are loyal customers, they giving complementaryside dishes such as salads or papads etc. can increase the goodwill of Chulha.

Chulha is not directly dependent on its suppliesas except the use of internet , it does not use anyHigh end technology to connect with its consumers.

Bargaining power of suppliers

Operations and Infrastructure cost is nominal asPer requirement.

Degree of rivalry

Competitions from the fast food chains, hotels taking away a potential market share of customers.

Even though they had stiff competitions but still theyHad unique attributes like; Quality standard. Delivery systems. Time bound. Variety of taste.All these attributes were quite different to be replicated.

Threats of substitutes

People usually prefer a good lunch respectively that of home, when at work. So, there is not a potential threat as such but owing to the changing food habits of people, they tend to have fast foods as well. So, that may be of little threat.

New Entrants

Fast food chains are establishing themselves. Hotels and cafeteria is corporates are the latest tend in this business.

Edward De BonoEdward De Bono

Red Hat: Connecting to emotions and feelings of People.

Green Hat: Being creative, analyzing growth possibilities and thinking of new ideas.

Yellow Hat as well because they were having a positive outlook towards expanding the business. Hence, like any dream it started a simple localized dabbawala but it had a positive approach to expand its business and to be well known.

QUESTIONS FOR DISCUSSIONS :

Q1) Do you think this is a viable business?

Yes it is a viable business.Problem Identified

Converted to Need

Chulha Emerged

Delivered Home Cooked food

Customer Satisfied

Chulha Generated Revenue.23

Suggested strategies for growth…Suggested strategies for growth… Simple survival technique : This is the rule for any business. And for Chulha ,

delivering hygienic and delicious food in time to customers was its sole aim. There are many competitors in the market, but admist competition it had to create a niche for itself by applying for extensive strategies to offer customer “Value for money” product.

Economies Of Scale : Even though Chulha had less profit margins, as it made in

bulk, but on the whole it did make a huge percentage of profit.

Technologies that can be adapted : Appointing food inspector, who would conduct surveys in

every week to ensure; a) Quality Standards are maintained b) The food is made in hygienic condition with proper

ventilation, cleanliness and disposal of waste. c) The colors that are being used are strictly under

proper gradation.

d) The different boilers, ovens, barbecues, gas stoves should be of good standards, being used separately (veg. & non-veg.).

e) The chimneys and the gas burners, ovens should checked to ensure no leakage of gas.

f) to ensure other safety parameters (from employees prospective).

Prestige and CSR activities Chulha should opt for different CSR activities like ; a) donating Rs-2 for every order it receives to fund an

NGO’s working to educate poor children. b) It can be an active participant in the Green

Movement, involved in planning trees in industrial areas to reduce pollution.

c) donating food 1 Sunday of every month to organization having challenged people.

d) packaging food in paper bags and other recyclable materials.

Expansion of Market Opening for party orders. Opening for the education market and planning to open

canteens in different colleges.

Government Policy Chulha can opt for an ISO certified standards set against

its quality of food, quality of ingredients used to prepare food. Using these It can set a benchmark for other restaurant which have to qualify the standards of food served by them. The government can thus standardize the quality of food served by the other food chains.

Self Sufficienct Chulha has its own supply of raw materials and it can

plan to be self sufficient in delivery of its products as well. It has its own restaurant space and has its own staff. Hence it is highly self sufficient.

Q2) Are there any changes you would like to introduce in their business model?

Morning breakfast segment.Digestive food after meal like Paan.Should tapped other cities as well like Mumbai, Delhi, Kolkata, Chennai, Pune etc.Tie up with Hostels, PG’s Owner, all Corporate Offices, Business Schools and Engineering college. Can add regional south meal in the menu.Should give franchisee to local housewives to do this business and promote Chulha in the areas where Chulha itself could not deliver food in time . Should provide catering services to several parties and functions and even to the Airlines and Railways.Should Organize cooking competition and award the winner and as result the company will get new ideas.

ConclusionConclusion

These case studies show a true

reflection of how right attitude,

proper conditioning and correct

approach can lead to great success

from scratch. This reflects the true

essence of a small business and an

entrepreneur.

L/O/G/O

Thank You!Thank You!