Mumbai Food Stalls

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Text of Mumbai Food Stalls

Prin L.N. Welingkar Institute of Management Development & Research L. Napoo Road, Matunga (C.R.) Mumbai - 400 019

PROJECT SYNOPSIS BUSINESS ANALYSIS OF F&B OUTLETS IN THE MUMBAI SUBURBAN SYSTEM

PROJECT ASSOCIATES

JOY FALCAO ( PG 13 ) SHOAIB MEMON ( PG 28 ) PRISOOMIT NAYAK ( PG 31 ) RAHUL SHANBHOGUE ( PG 49 )

SHOBHIT BAKLIWAL ( RM 1 ) KRISH DESAI ( RM 5 ) PRERNA PAWAR ( RM 12 ) ABHISHEK TANDON ( RM 19 )

Project Mentor Prof. Victor Manickam

BUSINESS ANALYSIS OF F&B OUTLETS IN THE MUMBAI SUBURBAN SYSTEM

TABLE OF CONTENTS

Sr. No. 1 2 3 4 5 6 7 8 9 10 11 Executive Summary

Particulars

Page No. 1 5 6 8 11 12 27 30 31 42 43

Introduction to the Project Research Process Secondary Research & its inferences Primary Research Observation & Findings Analysis & Inferences Recommendations Appendix Summary Output Bibliography

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BUSINESS ANALYSIS OF F&B OUTLETS IN THE MUMBAI SUBURBAN SYSTEM

EXECUTIVE SUMMARYWith the Indian economy slowing down due to the global financial crisis and rising fiscal deficit, it is imperative that we buck up our services sector which accounts for more than 50% of the GDP in which the F&B forms an integral part of the services pie . For millions of Mumbaikars commuting by the suburban trains, good quality food at railway stations still remains a distant dream. Indian Railways owns and manages one of the largest Railway

networks of the world with over 64,000 Route kms. and 7,000 stations.

The Mumbai Suburban Railway is a mass transit system serving the Mumbai Metropolitan Region. It is part of the public transport system of Mumbai, is provided for by the state-run Indian Railways' two zonal Western Railways and Central Railways. The system carries more than 7.24 million commuters on a daily basis. The Indian Railway Catering and Tourism Corporations (IRCTC) plans to give the food stalls at stations a makeover has hit a roadblock. The railway ministry has decided to take the catering business away from the profit-making public sector undertaking (PSU). The management of IRCTC has alleged that the vendor lobby, which has the financial muscle, is responsible for shunting out the corporation. Out of the 400 stalls in the Mumbai suburban section, only 55 were handed over to IRCTC after the catering policy of 2005. The vendor lobby has been putting pressure on the political leadership and the decision to remove IRCTC seems to be politically motivated, said an official. But, a railway board member refuted the allegations. The decision is not at all a political one, but it is purely based on the complaints received by the railway administration, said the member. However, the policy changes by railway minister Mamata

Banerjee are likely to affect around 4,500 IRCTC employees. Also, it would reduce IRCTC, a rare profit making PSU with a profit of close to ` 50 crore in the last financial year, into just another organisation with losses.

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BUSINESS ANALYSIS OF F&B OUTLETS IN THE MUMBAI SUBURBAN SYSTEM

The Railway Board, in its revised policy announced that has suspended catering operations of the Indian Railway Catering and Tourism Corporation Ltd. (IRCTC), an award-winning government agency, on railway platforms. The policy says catering services handled by the IRCTC will now be returned to the zonal railways. The idea is to improve the quality of food available on railway platforms. This means 120 IRCTC stalls on the Western Railway (WR) and 88 on the Central and Harbour lines will have to shut down. While private stalls have been functioning for a long time, the IRCTC had set up food stalls only two years ago to provide commuters with quality snacks, prepared and packed hygienically. The Railway Board had in October 2009 asked the IRCTC to float tenders inviting private players to set up stalls at railway stations. Owners of the existing private stalls protested against this saying it would take their business away. They approached the Railway Ministry and demanded that the catering policy be reviewed and they be allowed to run all stalls on railway platforms without IRCTC in the picture. The new policy now says the zonal railways will be responsible for ensuring that standards are maintained and policy directives complied with. We are only implementing the ministry's orders, a Railway Board official said requesting anonymity. The Central and Western railways will now have to select professional catering contractors and train people for the job. The IRCTC, meanwhile, will handle only food plazas, food courts and fast-food units. There are only four of these in Mumbai-at Chhatrapati Shivaji Terminus and Mumbai Central--and 90 units across India. The IRCTC has been trying to standardize the prices of tea and coffee sold at suburban railway stalls. The revised policy does even not talk about 5,000 employees of IRCTC who worked at the food stalls. The IRCTC pays the Western and Central Railways ` 2.5 crore each, every year, for using their platforms and trains. Private stall owners owe the IRCTC and the Railway Ministry ` 16 crore.

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BUSINESS ANALYSIS OF F&B OUTLETS IN THE MUMBAI SUBURBAN SYSTEM

INTRODUCTION TO THE PROJECTThere are in total 600 food stalls in the Mumbai suburban section in which 55 were controlled by IRCTC and remaining by Private Contractors and Zonal Railways respectively. The main purpose of our project is to find out average daily sales of food and beverage at Mumbai suburban railway stations. We are carrying out this research to get an idea about the most preferred food item (on Mumbai suburban railway stations) among the Mumbaikars.

We have also focused on the PEOPLE factor involved. We have covered all the issues related to employee salary & bonus, working hours and working condition of the employees. We conducted both primary research and secondary research. The research is done on 32 prominent suburban railway station covering the length and breadth of Mumbai.

Primary research data was collected through questionnaires and Secondary research, on the other hand, was done through research journals and websites including www.indianrail.gov.in.

The project tries to find out the sales trends at railway food stalls and thus giving us the finer details of the consumption patterns at different railway stations. It also covers the comparison of the eating habits at Central line railways stations vis- a-vis the consumption patterns at Western line railway patterns.

We had our various perceptions at the beginning of the project but during the course of the project we busted various myths about the F&B consumption habits at Railway stalls.

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BUSINESS ANALYSIS OF F&B OUTLETS IN THE MUMBAI SUBURBAN SYSTEM

THE RESEARCH PROCESSDescriptive Research Descriptive research, also known as statistical research, describes data and characteristics about the population or phenomenon being studied. Descriptive research answers the questions who, what, where, when, "why" and how... Descriptive research includes surveys and fact-finding enquiries of different kinds. The major purpose of descriptive research is description of the state of affairs as it exists at present. The main characteristic of this method is that the researcher has no control over the variables; he can only report what has happened or what is happening. It attempts to discover causes even when they cannot control the variables. 1. Identification of the Problem We used several sources like the Internet, Magazines and Government Offices to get information on the railway. We realized that IRCTC a body which provides catering services to the Rajdhani and Shatabdi and also runs food hubs has been told to shut down its stalls and hand over control to private contractors. These private contractors could be inexperienced and well connected and hence got this new rule permitted. We thus decided to meet officers from The Western and Central Railway Catering Departments. 2. Observation and Description We got data on the total number of stalls under each unit and also the total revenue under each unit. We also found out what norms are set by the railway and understood the way the railways administer these processes. Out of the secondary data, we realized that the western railway has lesser number of stalls and commuters than the central railway but still has 2.5 times the profit.

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BUSINESS ANALYSIS OF F&B OUTLETS IN THE MUMBAI SUBURBAN SYSTEM

3. Construction of Hypothesis Our hypothesis was that if private contractors ran stalls on both the Railways then the sales performance should be the same as each railway as both railways sell the same products and at the same price.

4. Testing of Hypothesis In order to test the hypothesis we visited a few stations and also the FDA. From the stations we realized that the one major deciding factor that affects sales is the freshness of food plays a vital role in the sales as Western Railways are not permitted to use LPG cylinders. This further invalidates our hypothesis as Central Railway has an added advantage to it.

5. Preparation of Questionnaire We prepared a questionnaire with an objective to analyze the sales performance and also get an idea of the total revenue that a stall earns. We also want to find out how performance of a stall and the business in general can vary on various qualitative parameters. We also wanted to study the effect of employee performance on the business on the basis of salaries given to them and working conditions. We designed the questionnaire with 30 questions in a sequential order to get correct information.

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BUSINESS ANALYSIS OF F&B OUTLETS IN THE MUMBAI SUBURBAN SYSTEM

SECONDARY DATA AND INFERENC