Chulha

By Rajeev Roy 1 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. They tried out some of the tiffin services but did not find them satisfactory. After thinking about it for some time, they decided to quit their jobs and start a professionally managed tiffin service in Bangalore. They found certain gaps in the current local tiffin service providers which could be easily addressed: 1. Quality is not maintained by other tiffin providers. In Chulha, one of the partners will be directly responsible for quality control to ensure that quality is maintained. 2. Usually the food is cooked by the owner who is a Kannada and has no idea about the taste buds of non-Kannadas who are the main clientele. Chulha plans to have north Indian cooks who can satisfy the demands with non-locals. 3. Currently no tiffin provider has a feedback mechanism in place. Also people have to eat what has been prepared without having any choice. Chulha has developed a website which among other things will deal with these requirements. A forum on the site will help them judge the tastes of their customers and they can adapt the tiffins accordingly. 4. The website (www.chulha.co.in) is going to be the main marketing tool. They will be employing a professional company to optimize it for google search so that it is easily accessible. They will depend on positive word of mouth to spread the word. Some add-ons will be provided from the word go. Apart from a veg and non-veg menu, they also plan to have a rice-only and a chapatti-only option for various food habits. Later they were planning on regional meals like Gujrati Thali and Bengali Thali. It was also planned to introduce a good sweet dish like shahi tukra or caramel custard. 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 average cost of a veg 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.45 Their justification is that the average IT professional will be willing to spend a little more for better food. The average living costs of a typical IT professional: @Rs.35 for 25 days in a month (except Sundays), the cost comes to Rs.850 p.m. An average single IT professional earns Rs.20,000 p.m. His expenses: House Rent: Rs.3000 Food: Rs.3000 Shopping etc: Rs.5000 Weekend Entertainment: Rs.4000 (Rs.1000 per weekend) Discussion Question: Do you think this is a viable business?

Pages 49-51, Entrepreneurship by Rajeev Roy, Oxford University Press, 2008 Copyright Rajeev Roy - Associate Professor, XIMB. All rights reserved.
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