UID: IIMP/CURIOUS/2017/051CURIOUS 2017 CASE STUDY COMPETITION

SWOT Analysis of Ganesh Bhel

India’s first Bhelpuri business organization tohave ISO 9001:2008 certification.

An organization with deep Puneri heritage (establishedplayer in the Paani Puri Industry since 1978).

Specific emphasis on Hygiene, Taste, Customer experience, usageof IT ERP

Wide assortment of traditional Bhel products, Dabeli, Paani Puriand other snack items like sandwiches etc.

Strong tie up with Corporate Clients like Cognizanttechnologies and Marriott.

Strong network of retail outlets across Pune andavailability of packaged Bhel products. SWOT

Portfolio of Corporate Clients needs togrow to achieve Volume sales. Key accountsneed to grow to ensure consistent growth.

Retail outlets of Ganesh Bhel are not up to the mark of otherQSR competitors like Kalyan Bhel, Haldiram’s, GoliVadapav etc.

Ratings of Ganesh Bhel particularly the Nigdi, Karve Nagaroutlets are 2.7 & 3.3 / 5 respectively on Zomato. This doesnot reflect well on the Ganesh Bhel brand and customerexperience. Product assortment of Take home packs (SKU’s) is

particularly bad and is unable to meet demand.SWOT

Going forward we have suggested the ways and plan regarding how we can capitalize

on the opportunities and reduce the weakness and threat. We suggest to focus on the

service part of Ganesh Bhel as an emerging QSR, while maintaining the high

standards of product quality.

When it comes to QSR we come across a lot of GAPs. While we visited the outlets of

Ganesh Bhel at Pimple Saudagar, Aundh and Nigdi we got to know about the

following services gaps:

Opportunity to build a pan-India brand through concertedBranding efforts

To evolve into a true QSR outlet on a pan India scaleon the lines of Goli Vadapav, Haldiram’s, Bikanerwala.Pan-India Expansion through adoption of Franchise model.

Significantly expand online food delivery business throughintegrated tie-ups with Swingy, Foodpanda, Zomato, Faasos,Runnr etc.

Huge opportunity to grow packaged Bhel businessoutside Pune through online/offline channels.

Opportunity to further make a dent in the Savoury snack marketwhich is expected to grow at 12% CAGR from 2016-2021.

SWOT

Intense competition from other established playerslike Kalyan Bhel, Haldiram's, Bikanerwala etc.

Market is very fragmented. Emergence of other players like MaiyasFood products, Prakash food products, Lakshmi food product andother local players make the savoury snack market intenselycompetitive.

Corporate Accounts with in-House product and privatelabels threaten to disrupt the market.

Competitive Pricing is going to be a challenge due toprice volatility in the raw material purchase.

SWOT

GAP Model Analysis of Ganesh Bhel

Gap 1

*Customer want to spendtime with friends and familybesides eating, more focus onservice is needed

*They want Good Ambience(Quirky Ambience) with Wi-Fi and soft music which lacksat our outlets

*They want to go to therestaurant that is famous andpromote itself actively

Gap 2

*No clear guidelines onService parameters (KPIs) tobe followed

*Poor Perception about ourrestaurant needs to beimproved on social media (e.g.2.1 rating on Zomato, NigdiOutlet)

11Customer engagement is notup to the mark. QSR likeBurger King and MacDonald'shave set a standard in customerengagement

Gap between consumerexpectation and

management perception

Gap between managementperception and servicequality specification

Gap 3

Gap between servicequality specificationand service delivery

*Staff is not well trained, as aresult it severely hampers theexperience of customers

*Lack of product quality,customers have mentioned thatthey have tasted better Bhel,Pani Puri at other restaurants

*Customers link ambience withthe money they are charged, sothey find Ganesh Bhel as costly

Gap between servicedelivery and external

communicate on

Gap 4

*Ganesh Bhel has projecteditself as the Iconic Brand ofPune which provides qualityproducts.

*ISO certification again raisesthe expectation of customers interms of product quality, buttheir expectations are not met

*Promises the service of aQSR but lacks in infrastructurein Service quality

Gap 5

*Customer expects benefits ofa QSR (on the line of KalyanBhel or Haldiram’s) formGanesh Bhel, but they don’tfind it.

*Customer wants highlycustomized product the likesof what they get at KalyanBhel.

*Customers wants the staff tobe professional and friendly,which they don’t get at times.

Gap between expectedservice and experienced

service

Challenges faced by Ganesh Bhel

Strategy for Ganesh Bhel

4 Strategic Pillars

CustomerExperience

Taste & Quality

ProductAssortment

Strong Branding

GE-Mckinsey Matrix to Decide Priority of Investments

PackagedBhelpuri /SavourySnacks

OnlineDeliverymodel

FranchiseModel

QSROutlet

DeliveryModel

CorporateBusinessTie-ups

Indu

stry

Attr

activ

enes

s

Competitive Strength of BusinessUnit

HighMediumLow

Priority for investment /attractiveness:

Key Service and Product Fundamentals for Ganesh Bhel

Growth Avenues for Ganesh Bhel

PARAMETERS

Product Fundamentals

Quality Training

Process Standardization

Use of technology

Store Ambience

Store Layout Standard

TQM, Kaizen

Customer Experience

Customer Orientation

Product Assortment

Service Fundamentals

Growth Avenues

Online Delivery ModelExpansion

Packaged Bhel Products

Increase ProductAssortment

Increase QSR Outlets

Sell Products onEcommerce Platforms

Marketing Campaigns

Corporate PartnershipsExpanding Catering

Services

Strategy to increase sales through online ecommerce

Five step process

Target Customers

Convenience Buyers

Working Population

Pan-India Customers

NRI Customers

Packaged Bhel products to bemade widely available at

outlets like Big Bazaar, D-Mart, Megamore Outlets etc.Ensure availability at Momand Pop outlets to widen the

reach and tap the market

Packaged Bhel products to besold on ecommerce platformslike Amazon / Amazon Now,Snapdeal Grocery under the

snack category.

Tie up with hyperlocalservices like Grofers,

Bigbasket etc. to targetworking population who havespecific affinity for packaged

ready to eat products.

1 2 3

Listing of products on sites likeflavourofmycity, sweetsinbox

etc. which specifically sellpopular delicacies from all overIndia to customers within India

as well as abroad.

Ganesh Bhel can also open thesale of products globally

through Amazon Global, EBayGlobal, iShip etc. to cater to theNRI community who crave for

these products.

4 5

Growth Avenues | Detail

1 Week TrainingProgram Contents

Strategy to increase sales through Increased QSR outlets

Existing QSR outlets ofGanesh Bhel to be renovatedin order to offer modern QSRfacilities. Store Ambience is a

key aspect to providesuperior customer experience

Existing QSR staff to betrained in customer service &

delivery through corporatetraining exercises. Any new

staff recruited shouldmandatorily undergo 1-weektraining program specificallydevised for Ganesh Bhel. All

employees to undergorigorous quality training.

Specific emphasis onmaintaining hygiene

throughout the store outlet.Store to be equipped withSelf – dispose dustbins,

auto wash basins etc.Special emphasis given to

food packaging andfreshness

1 2 3

Store Ambience Staff Training Store Cleanliness

All QSR outlets to become digital paymentenabled. Tie ups with payment wallets likePayTM, Mobikwik, Freecharge, Ola Money

to provide ease of access for payments.Payments should also be UPI enable to

further enhance ease of Access.

Rapid expansion of QSR outlets fromcurrent 6 to 12 in the FY 2018 (in Pune).

Allow expansion through franchise modelfor rapid scale up of QSR outlets. Pan-India

expansion facilitated through franchisemodel.

4 5

In store Payments Store Expansion

Customer Acquisition/Retention through increased QSR Outlets

flowchart

TargetCustomers

Existingcustomers

CompetitionCustomers

New Customers

Lure customers ofcompetition like Kalyan

Bhel, Haldiram's,Bikanerwala etc. through

superior customerexperience & taste.

Increase reach through

Retain existing customersby providing superiorservice standards on a

consistent basis. Addresscustomer grievances andsuggestions with utmost

importance & priority.

Acquire new customersthrough in store

campaigns. Aggressiveacquisition of new

customers through onlinechannel.

Sales growth through online food delivery portals

FoodDeliveryPortals

Extensive sale of entire productassortment through online foodportals like Foodpanda, Swiggy,Runnr & Zomato. Onlinepromotions on these sites to lurenew customers.

Expanding product assortmentvia exclusive only menu foronline customers.

Specific promotions for repeatcustomers like exclusivediscounts, gift vouchers etc.

PhoneOrdering

Provide phone-orderingservices to customers within 5-mile radius directly throughstore outlet.

Delivery of packaged Bhelproducts directly through thestore outlet to customers within5-mile radius.

Expansion of Product menu to cater to varied needs of the customer

Core Products Side Products

Traditional Bhelproducts

Paani Puri

Bhel Puri

Ragda Puri

Dahi Puri

Dabeli

Sandwiches

Additional Menu

Milkshakes

Smoothies

Natural Fruit drinks

Packaged IceCreams

Cold Drinks

Side products are extremelyessential to today’s QSRrestaurant.

These are high margin & fastselling products.

Extremely essential to provideone stop shop for all theirconsumption.

Partnership and Other Services

Partner with executiverestaurant chains

Partnership with Corporateclients (IT)

Tie ups with educationalinstitutions spread across Pune

Catering services for smallgatherings

Catering for variousceremonies

Catering at various festiveevents

Catering for Birthday Parties

CorporatePartnerships

Catering / Partyservice Business

Ganesh Bhel needs to establish a vision where Corporate Accounts/ Catering business contribute to at least 30-35% of the overallrevenues by FY 2019.

Key Organizational Change Required for catering to B2B business

These changes has to be done to cater to B2B business.

In the next 2-3 years’ corporate partnerships and Catering/Partyservice business is going to contribute significantly to the overallrevenues of Ganesh Bhel hence it is essential that theorganizational structure is conducive to rapid growth.

At the lowest level Business Development Managers would berequired to scout potential business clients and engage in adiscussion with them. Key account managers would be handlingkey corporate clients and would be directly working under theCEO.

CEO

Key AccountManagers

Business DevelopmentManagers

Expansion Plan for Ganesh Bhel

Pan India Expansion Plan Franchise Model

25 Pan India FranchiseOutlets by FY 2019

Pan India expansion of Ganesh Bhel:

Mumbai

Ahmedabad

Jaipur Delhi

Nasik

Pune

Bangalore

Bhopal

Indore

Surat

Key Secondary States

Key Primary States

Phase – I FranchiseExpansion

Phase – II FranchiseExpansion

Legend

Owned QSR Outlet

Expanding on Franchise Model | Franchise Expansion Phase

Primary Research | Competitor Benchmarking

imary Research

Total customer surveyed: 90,Average of their responses is mentioned in the rows

Marketing of Ganesh Bhel:

We want to project Ganesh Bhel as #AuthenticPune, we want to relate Ganesh Bhelwith the rich history of Pune in particular and Maharashtra as a whole. We want tomake Ganesh Bhel a brand that is a must visit for every Punekar and for all those whocome to visit Pune.

Our Integrated Marketing Campaign will revolve around #AuthenticPune tag line

Marketing Campaigns

1): Online

2): Offline

#Campaign 1

Snack Partner of Puneri Paltan or Pune F.C – league

Description: Become Official Snack Partner for sporting teams connected with Pune,Intensive campaigning through both Offline and Online Mediums, AssociatingGanesh Bhel as Pune's iconic

Mediums of Promotion: Stadiums, Venues, Promotion booths, Store Outlets,FB/Twitter/Instagram Channels, Fan Meets,

#Campaign 2

Advertising Campaigns with thepunekar.com, foodprowl.com, TripAdvisor, Zomato

Punekar.com

TripAdvisor

Zomato | Giving featured ads and banner ads

Description: Advertising on Portals advising must visit places for Pune and specificblogs about Pune eateries

Mediums: Online Blogs, Food Recommendations Portals, must visit places list.

#Campaign 3

Recommendations by some of the influencers like Amita Gadre Kelkar etc.

Description: Usage of Influencers for Food Recommendations, must visit places list.

#Campaign4

Promoting the packaged Bhel products from Ganesh Bhel

Description: Setting up Facebook / Instagram

foodie groups where curated posts about

different usage of Ganesh Bhel is posted.

People can also share their favourite usage of

packaged Bhel recipes,

#Campaign5

Viral Instore campaigns (#ThePaaniPuri Challenge)

Description: Viral campaign on the lines of the burger challenge by Burger BarnF.C Road. People have to finish X no. of Paani Poories in X minutes/seconds. If theyare able to beat the current

Medium: Exclusively at Ganesh Bhel Store Outlets

#Campaign6

Short TV ads on Regional Channels like Sakal Times

#Campaign7

Online Opinion poll

Description: As a part of socialcampaign, we will host an online quizasking people of Pune their opinionon the same, it will be more of anopinion poll by which will plan tocreate visibility, customer engagementand plan to project Ganesh Bhel as aresponsible brand that cares for Pune

#Campaign8

Branding and associating Ganesh Bhel with big Pune Festivals

#Authentic Pune

#Campaign9

Snapchat: A 2 min ephemeral video regarding different snack recipe, itwill help customer engagement and pulling in millennials customers.

#Campaign10

Mural and Graffiti: Collaborating with PMC to put Graffiti and Muralsnear heritage site of Pune, so that people could relate Ganesh Bhel with arich heritage of Pune

#Campaign11

Check-in Discount: If customer check in on their FB page that they areeating at Ganesh Bhel they will get 10% discount

Financials

P&L Projections of Ganesh Bhel QSR Outlet for FY 18-20.

P&L (Per QSR Store Projection)Parameter FY 2017 FY 2018 FY 2019 FY 2020

Daily Sale (in Units) 125 138 151 166

Unit Price 50 55 55 60

Total Daily Sales (in Rs /-) 6250 7562.5 8318.75 9982.5Total Monthly Sales (in Rs /-) 187500 226875 249562.5 299475

Operational Expenses

Total Salary Expenses 65000 69550 74766.25 80747.55

Average Rent Expenses 25000 26750 28890 31490.1

Other Overheads 8000 9100.21 9372.46 10481.63

Average Wastage 9375 10587.5 10814.38 11979Raw Material Cost 22500 28368.45 32515.92 40657.9

Total Cost 129875 144356.2 156359 175356.2

Net Profit (per month / perstore) 57625 82518.84 93203.5 124118.8

Net Profit / Year / per store 691500 990226 1118442 1489426

Investment / QSR Store 1400000

Payback Period (with Interest)2-2.3years

Assumptions used for P&L Projections

Projection Assumptions (per QSR Store)Parameter FY 2017 FY 2018 FY 2019 FY 2020 RemarksDaily Sale growth (%) N.A 10.00% 10.00% 10.00% Daily Sale growth is assumed to

be 10% from FY 2018-2020Unit Price 50 55 55 60 2 year cycle for price rise of 5/-

per Bhel Puri Unit is consideredOffline Sales / Total Sales (%) 90% 85.00% 75.00% 70.00% Bifurcation of Online to Offline

Sales for Ganesh Bhel ProductsOnline Sales / Total Sales (%) 10% 15.00% 25.00% 30.00%Average Salary Expenses growth (%) N.A 7.00% 7.50% 8.00% Average Salary hike from FY

2018-2020 (capped by GDPGrowth)

Growth in Rent Expense (%) N.A 7.00% 8.00% 9.00% Average hike in rent expensesfrom FY 2018-2020 (capped byGDP growth)

Other Overheads / Sales (%) 4.27% 4.01% 3.76% 3.50% Average Overhead expensesare expected to be reducedfrom 4.27% of Sales in FY 18 to3.5% of Sales as result ofadoption of TQM, Kaizenprinciples

Average Wastage / Sales (%) 5.00% 4.67% 4.33% 4.00% Average wastage (%) is alsoexpected to be reduced from5% of Sales in FY 18 to 4% ofSales in FY 2020.

Raw Material Cost increase (%) 4.20% 4.20% 4.20% Raw Material Cost is capped atthe CPI Inflation rate for Longterm

Raw Material Cost / Sales (%) 12.00% 12.50% 13.03% 13.58%

Average Investment / Store (assuggested by Author)

10-15Lakhs

Our Suggested Investment / Store 14-18Lakhs

Comparison of Key Performance Ratios of Ganesh Bhel and KalyanBhel

Current Parameters (per QSR Store) (FY 2017)Parameters Ganesh Bhel Kalyan BhelSalary Expenses / Total Sales 34.67% 38.33%Overhead Expenses / Total Sales 4.27% 4.44%Rent Expenses / Total Sales 13.33% 13.89%Average Wastage / Total Sales 5.00% 5.00%Raw Material Expenses / Total Sales 12.00% 12.00%Total Expenses / Total Sales 69.27% 73.67%Net Profit Margin (PAT Margin) 30.73% 26.33%

Marketing Budget Outlay FY 2018

Marketing Campaign BudgetOffline Campaigns

Advertising @Pune Railway Station 4 lakhsAdvertising @ Heritage Places in Pune 2 lakhsMerchandising Partnership with Sports Teams 8 lakhsAdvertising Campaign in Malls / Stores 3 lakhsMiscellaneous Costs 4 lakhTotal Cost for Offline Campaigns 21 lakhs

Online CampaignsFacebook / Twitter / Instagram / YouTube 1 lakhPrizes / Gift Vouchers / Promotions 2 lakhsTotal Cost for Online Campaigns 3 lakhsTotal Marketing & Advertising Costs 24 lakhs

Comparison of Ganesh Bhel vs Kalyan Bhel Per Store Profits

Current Parameters (per QSR Store) (FY 2017)Parameters Ganesh Bhel Kalyan BhelDaily Sale (in Units) 125 120Unit Price 50 50Total Daily Sales (in Rs /-) 6250 6000Total Monthly Sales (in Rs /-) 187500 180000

Operational ExpenseAverage No. of Employees 8 8No. of Outlet Head 1 1Average Employee Salary 7000 7500Store Manager Salary 9000 9000Average Rent (350-400 sqft.) 25000 25000Other Overheads 8000 8000Average wastage 9375 9000Total Operational Cost 107375 111000

Raw Material Cost 22500 21600Total Cost 129875 132600

Net Profit 57625 47400