INTRODUCTION

The retail industry being a significant contributor of GDP to national economy, is certainly
one of the highest revenue generating industries currently in action in the country. According
to a report by National Restaurant Association of India (NRAI) and Technopak the size of the
food services market in India is estimated at $48 billion in 2013. Chains account for as much
as five per cent of the total market. The size of the food service market is projected to grow
at a CAGR of 11 per cent and over the next five years it will reach $78 billion by 2018.In this
apparently unorganized market Interestingly the quick service restaurant(QSR) and casual
dining segments together forms 74 per cent of the chain market while cafes make up 12 per
cent. Cafes are an impulsive option for hanging out while fine dining places are reserved for
families.
The transformations occurring in the retail market is fast-paced & dynamic together with that
changing taste and behaviour of the customers has tradition of previous couple of years, it is
evident that this area has achieved tremendous growth in the overall food retail business.
Whether food or grocery retail in India would grow is no longer a debate today but rather
how fast can it grow and what challenges need to be overcome is of utmost importance.

Major Challenges faced by the industry

Penchant for fresh/home-made and value consciousness: The Indian consumer, unlike his

Western counterpart, has a penchant for freshly cooked food over packaged food. This is a
result of dietary patterns, poor electricity supply, low penetration of refrigerators and a family
structure where one of the primary roles of the housewife is feeding the family. The Indian
consumer is extremely value-conscious.

Diversity of tastes and preferences : Multiple cultures, languages and religions have a

huge bearing on the tastes and preferences of the Indian consumer. This will pose a challenge
for players aspiring to develop a pan-Indian presence.

Willingness to travel : Given the current density of retail outlets in India, retailers will

have to motivate the consumer to trade convenience with price, range and ambience.

Sourcing base and efficiency : The fragmented agriculture supply base coupled with an

inadequate legal framework make it difficult for retailers and food processors to procure

quality produce at competitive costs directly from farmers. The small size of the food
processing industry further limits the supply options.

Real estate availability and cost : Rentals account for 7-7.5% of the total costs for

organised retail in India against global benchmarks of less than 3%. Real estate availability
and costs will continue to remain a challenge in the retail industry with factors like adequate
parking, ambience and proximity being the key drivers of footfalls.

Manpower availability: As organised retail expands, there is expected to be a dearth of

skilled manpower. The lack of institutions and courses for different aspects of retail
management will have an impact on the overall supply of quality manpower.

Emerging trends in food retailing

Big becoming bigger : Globally, retailers have realised that size drives profitability, not

just through economies of scale in operations but also through higher bargaining power
leading to better margins. While many players are entering the retail space in India currently,
the growth stage will be characterised by rapid expansion and consolidation among these
players.

Rise of organic foods and health and wellness segment : Consumer attitudes and

preferences are undergoing a shift owing to factors like increased disposable incomes,
changes in lifestyle patterns, shift in age structure, increased number of working women and
multi-cultural exposure. These would lead to increasing health consciousness in the future.
Organic foods and wellness products would be emerging opportunities in the years to come.

Increasing focus on private labels : As competition in the organised retail market

increases, discounts and promotions are expected to play a critical part in generating footfalls.
To counter the impact on profitability, organised players will find it more attractive to
promote private labels or store brands given their higher margins. The consumer too would
benefit from lower prices.

INDUSTRY PROFILE
DOMESTIC PLAYERS

Nirulas
Who are they?
Nirula brothers ventured into the fast-food segment of India in 1970s with the opening of
first fast- food restaurant of Delhi in Connaught Place in 1977.There mission was To give
joyful moments to generations through delicious and affordable, Indian and International
choices in a fun-filled and friendly environment by innovative and passionate people. This
north India based fast-food chain is mostly popular in NCR Delhi. With over 70 outlets in
Delhi, Haryana, Bihar, Punjab, Rajasthan, Uttar Pradesh states, Nirulas is a prominent
domestic player in fast-food chain of India.
Offerings
With varied range of products offering finger licking good taste and consistent quality
Nirulas have penetrated into the market successfully. Some of their products from their long
list of offerings are Indian items like Kebab meals , Mini meals , Thalis of various options to
choose from ,Sandwiches , foot longs , pizzas, burgers , cakes- pastry , beverages etc.
Market Share
Indias pioneering quick serve restaurant Nirulas have a market share of 9% in the foods and
beverage industry of India.
Competitive environment
With the quick increase in disposable income of Indians the opportunities for the players in
this Industry is endless. But the entry of foreign players like Mc.Donalds, KFC, Pizza Hut
etc. and growing number of domestic players in the industry Nirulas face a high threat from
the competition. All the quick serving restaurants , cafes , and Indian snacks and mithai shops
are traditional threats to Nirulas. The major threats faced by the company in India are from
Haldiram, Bikanerwala , McDonalds , Dominos , CCD ,
companys strength lies primarily in
1. High brand awareness in the NCR region

Local restaurants etc. The

2. High quality image

3. Excellent quality and consistency
4. Significant market share
Production facilities
It includes confectionaries ,bakeries ,cheese plant , ice cream plant , food processing unit and
hot kitchen.

Cafe Coffee Day

Who are they?
In the year of 1996 the first outlet of Caf coffee day was opened in Bangalore. Cafe coffee
day is the pioneer of the caf culture in India and first to launch Coffee bar concept in India.
With the mission of Creating a better touch point for brands to connect with their audience
CCD has captured its market successfully. With presence in over 200 towns and 1640 stores
across the country CCD is a major entity in the quick serving food and beverages industry
and the fastest growing caf in India.
Offerings
A smart, simple space that the young and young at heart could call their own for a while, sit
down, talk and listen to conversations, hold short meetings or even have a lot of good fun - all
over steaming cups of coffee. In two different arrays CCD offers a range of quick serve foods
and hot, steamy , rejuvenating beverages. Foods like sandwich , sweet treats , deserts ,
sundaes , cake away and among beverages hot coffee , cold coffee , chocoholicas , frosteas ,
hot teas , quenchers are major offerings they made at their outlets.
Market Share
With annual revenue of 1000cr and with 1640 stores across the country it has a market share
of 35% in the hot beverages and food segment in India.

Major Competitors
Though Cafe Coffee day is the pioneer of the concept of coffee bar in India , with increasing
number of players in the Fast food and hot beverages industry Cafe
coffee day faces major threats from Barista lavazza , Tea junction , Starbucks (global
competitor). Cafe coffee day also faces indirect competition from Haldirams , Bikanerwala
Data taken from economic
times (2012)

and McDonalds.

Market share
Barista
Minerva Coffee
Shop
Caf coffee
day
Gloria jeans
Beyond coffee

Haldirams
Haldirams began as a tiny shop in Bikaner. In 1982 it set up its first shop in Delhi. USA was
the first international market Haldirams started exporting to in the year of 1993.Started with
15 products all of which were savouries , they have grown to a $4million brand. And
presently their existence is not only prominent in India but also in USA, UK, Middle east.
Offerings
Haldirams came to stand for a food company that is synonymous with taste , hygiene ,
innovation. Their key product variants are Namkeens , sweets , sherbets , pani puri , royal
temptations , minute khana , chips , whoopies and bhujia.
Market Share

Presently the company has a market share of 20% in organized market and 8% market share
overall with a turnover of 30million.A competitive diagram of market share was published by
Nielsen in 2011.
Major Competitors
Major competition is faced from bikanerwala , unorganized players , Frito lays

& Pepsi

foods , evergreens , Britania etc.

The major strengths are
1. Quality
2. Research development
3. Man power
4. Pricing
5. Latest technology
6. Trust of customers
Beside these major domestic players some more important entities in this segments are
Amuls restaurant , Bikanerwala , Wow momo , Barbeque nation , vadilal etc.

INTERNATIONAL PLAYERS
Dunkin Donuts
Dunkin Donuts is an American global doughnut company and a coffeehouse chain. It was
founded in the year 1950 by William Rosenberg. With 11000 restaurants spread across 33
different countries it is one of the largest coffee and baked goods chain in the world. For the
year 2013 the franchisee business reported total sales of $9.3 billion. During the full fiscal
year, net income rose 36% to $146.9 million from $108.3 million and revenues increased 8%
to $713.8 million from $658.2 million. U.S. same-store sales rose 3.4% at Dunkin Donuts
and 0.8% at Baskin Robbins.
Dunkin brands is home to two of the worlds most recognized and loved brands.

Dunkin Donuts: Worlds favourite every day, all day stop for coffee and baked goods
and the worlds leading baked goods and coffee chain.

Baskin Robbins: The worlds largest chain of ice cream speciality shops.

There are nearly 11000 Dunkin Donuts restaurants in 33 countries and 7300 Baskin Robbins
retail shops in nearly 50 countries.

Dominos Pizza
Domino's Pizza is an American restaurant chain and international franchise pizza delivery
corporation. It is the largest pizza delivery chain worldwide with more than 10,000 corporate
and franchised stores in 70 countries. Having started in 1960, in 1998, after 38 years of
ownership, Domino's Pizza founder Tom Monaghan announced his retirement, sold 93

percent of the company to Bain Capital, Inc. for about $1 billion. In the year 2013 its
combined revenue is $1.8 billion.

Jubilant Foodworks
Jubilant Foodworks and its subsidiary is the master franchisee of Dominos Brand in India.
The company is Indias largest and fastest growing food service company with a network of
772 Dominos Pizza restaurants (as of 6th August, 2014). The Company is the market leader
in the organized pizza market with a 67% market share in India (as per Euro monitor report
2013)
The Company launched Dunkin Donuts in India in April 2012 in Delhi. The Company has
34 Dunkin Donuts restaurants in India (as of 6th August, 2014).With the launch of Dunkin
Donuts in India, the company is now well poised to address two distinct non-competing
segments of the Food Service Industry in India, namely the home delivery of Pizzas market
and the all day part food and beverage market.
Total revenue in Q4FY14 stood at Rs 4,337.3 million and Rs 17,235.0 million in FY14. The
Profit after Tax in Q4 FY14 stood at Rs 249.5 million and Rs 1,258.0 million in FY14.

Burger King
Burger King, often abbreviated as BK, and founded in 1953, is a global chain of hamburger
fast food restaurants headquartered in US. In late 2010, 3G Capital of Brazil acquired a
majority stake in BK in a deal valued at US$3.26 billion.
BURGER KING is the second largest fast food hamburger chain in the world. It operates in
over 13,000 locations serving more than 11 million guests daily in 91 countries and territories
worldwide. Approximately 99 percent of Burger King restaurants are owned and operated by
independent franchisees, many of them family-owned operations that have been in business
for decades.
Burger King Worldwide, Inc. had revenues for the full year 2013 of $1.1B USD. This was
-41.7% below the previous year's results. Adjusted EBITDA increased 10.0% on an organic
basis to $665.6 million. With 670 new restaurants added globally Burger King is the second

largest chain of hamburger fast food restaurants in terms of global locations, behind industry
bellwether McDonald's (32,400 locations); it is the fourth largest fast food restaurant chain
overall after Yum! Brands (parent of KFC, Taco Bell and Pizza Hut totalling 37,000
locations), McDonald's and Subway (32,000 locations).
In November 2013, Burger King Worldwide, Inc. and Everstone Group, a leading private
equity and real estate firm in India and South East Asia, announced the establishment of a
joint venture to develop the BURGER KING brand presence in India. Under the terms of the
partnership, the joint venture has signed a long-term master franchise and development
agreement which includes sub-franchise rights for all of India.
Papa Johns
Papa Johns pizza, founded in 1983, is the fourth largest take-out and delivery pizza
restaurant based out of United States. As of December 29, 2013, it operated 4,428 Papa
Johns restaurants consisting of 723 company-owned and 3,705 franchised restaurants in 50
states of the United States and 35 countries.
In FY 2013, Papa John's International Inc. earned a consolidated revenue of $1.4 billion a
7.2% increase from 2012 revenues of $1.3 billion. The Company opened 132 net global
restaurants for the fourth quarter and 265 for the full year, of which 183 were International
and 82 were in North America.
Om Pizzas and Eats is the Indian franchisee of Papa Johns products. According to latest
development as of December 2013, the family of Vinod Mittal, the former managing director
of the erstwhile Ispat Industries, is poised to enter India's food and beverages industry by
buying a majority holding in the franchisee Om Pizzas and Eats from TVS Capital which
controls more than 80% share in Om Pizzas.
McDonalds International

Established in the year 1948 by Dick and Mac McDonald it is now the leading global
foodservice retailer with more than 32,000 local restaurants which serve more than 58 million
people in more than 130 countries everyday.it employs a total global force of around 1.9
million people. 70 percent of restaurants worldwide are owned and operated independently.
Offerings

Burgers (chicken,ham,veg) ,French fries ,drinks(nonalcoholic) ,shakes ,desserts

McDonald India

McDonald's entered India in 1996.India became the 95th country to host a McDonald.It is
managed jointly by two entities in India .One being Connaught Plaza Restaurants Pvt. Ltd
manages the Northern and Eastern Region .it is owned by Vikram Bakshi. Smita Jatia under
Hardcastle Restaurants Pvt. Ltd. in the Western and Southern Region.
Network
McDonalds has 300 restaurants operating in India serving over 5,00,000 customers
everyday and has completed more than 10 years of unparalleled in the country.There are
around 10,000 employees currently employed directly with McDonald's restaurants across
India.

Yum Foods
It has a total revenue of 13,084 million dollars. It employs a global workforce of around 1.5
million people.
1. Pizza hut
Founded in 1958 Pizza Hut is an American restaurant chain and international franchise, it is
headquartered in Wichita, Kansas and also a subsidiary of Yum! Brands, Inc.

In India Pizza Hut has 367 numbers of outlets.

Products : Pizza and side dishes

2.KFC
Founded in 1938. KFC or Kentucky Fried Chicken) is a fast food restaurant chain and is
headquartered in Kentucky, in the United States. It is the world's second largest restaurant
chain (as measured by sales) after McDonald's, with 18,875 outlets in 118 countries.In
India ,KFC has 361 outlets.
Products: Fried chicken and side items
2. Taco Bell
It is an American chain of fast-food restaurants headquartered in California.They serve a
variety of foods including tacos, burritos, nachos, other specialty items, and a variety of value
items. Taco Bell serves more than 2 billion customers each year in more than 6,500
restaurants. In India Taco Bell has just 5 outlets.

Subway
Founded in 1965 , Subway is an American fast food restaurant franchise that is owned and
operated by Doctor's Associates, Inc. Subway is one of the fastest growing franchises in the
world, with 42,252 restaurants in 107 countries . Subway entered India in 2001 in New Delhi
and has swiftly grown its operations to 403 operating restaurants in 68 cities across India.
Products
Submarine sandwiches (subs) and salads.

Starbucks

Founded in 1971 by Jerry Baldwin ,Gordon Bowker and Zev Siegl Starbucks Corporation,
was founded by is an American global coffee company and coffeehouse chain based in
Washington. Starbucks is the largest coffeehouse company in the world, with 23,305 stores in
65 countries.it has a total revenue of US$ 14.89 billion.
Products
Coffee , tea ,pastries ,Frappuccino beverages.