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“SETTING UP OF A FOOD
CHAIN BUSINESS IN INDIA”

Submitted by

DEVANG JOSHI
MFM – Sem V
Roll No.14

Under the Guidance of

‘Prof. M.P.REGE’

In partial Fulfillment of
MFM course
University of Mumbai
(2008-2011)

Prin.L.N.Welingkar Institute of Management

Development & Research
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Matunga, Mumbai- 400019.

CERTIFICATE FROM GUIDE

This is to certify that the project entitled "Setting up of

food chain business in India" is successfully done by
Mr. Devang Joshi during the Third year of his course in
partial fulfillment of the Masters Degree in Financial
Management under the University of Mumbai through
the Prin.L. N. Welingkar Institute of Management
Development & Research, Matunga, Mumbai-400 019.

This project represents the work done by Mr.Devang

Joshi.

This project in general is done under my guidance.

Date : 10/10/2010 Signature of

the Project Guide

Name of the Project Guide: - Prof. M.P. Rege

Address:-
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Mobile No: - 9820106435

Email ID: - mprege@gmail.com

ACKNOWLEDGEMENT

It is with great pleasure that I wish to express my

deep sense of gratitude to Prof. Mr. M.P. Rege who
provided invaluable guidance and was a constant source
of inspiration throughout the project. I would also like to
thank all my colleagues and Welingkar Institute of
Management Development & Research for their
keen interest, encouragement and valuable guidance
during the various phases of preparation of this project.

Lastly I would like to thank all my friends and well

wishers who extended their valuable co-operation
towards this project.
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Devang Joshi.

SETTING UP OF FOOD
CHAIN BUSINESS
(WAFFLE) IN INDIA
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CONTENTS:

 INTRODUCTION
 TRENDS OF FAST FOOD IN INDIA
 EXECUTIVE SUMMARY
 DESCRIPTION OF BUSINESS
 MARKET ANALYSIS
 COMPETITIVE ANALYSIS
 DESIGN & DEVELOPMENT PLANS
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 OPERATIONS & MANAGEMENT PLANS

 FINANCIAL COMPONENTS
 CONCLUSION
 BIBLIOGRAPHY

INTRODUCTION

INDIA – A FAST GROWING FOOD AND DRINKS

MARKET

The Indian food and drinks market is one of the fastest growing markets in the world.
India has the second largest population in the world, with diversified food habits. Such
a vast population and diverse eating habits make India one of the most attractive retail
destinations across the globe. Increasing purchasing power, changing lifestyle, growing
nuclear families and influence of western culture are the key drivers of the Indian food
and drinks market.
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The Indian food and drinks market has observed strong growth over the past few years.
Economic liberalization and rising income of middle class population have had a
positive impact on consumer spending and consumption in both rural and urban areas.
Indian consumer now spends a significant proportion of disposable income on food and
other essential commodities. Several other factors like demographic and macro
economic conditions have also given fillip to expenditure on food and beverages in the
country.

The research report “Indian Food and Drinks Market: Emerging Opportunities” has
projected that the Indian food and beverages market will grow at a CAGR of around
7.5% during 2009-2013 to around US$ 330 Billion by 2013. All the segments registered
uptrend in terms of consumption and sales between 2005 and 2009. The organic,
packaged food and ready-to-eat food have also seen strong demand as life in metros
become more hectic and busy. People look for healthy and ready to eat food to avoid
time wastage on preparation. Thanks to negligible time in preparation and
convenience, urban consumers (particularly service class) have imbued these foods in
their lives.

TRENDS OF FAST FOOD SNACK IN

INDIA

Quick food outside the home or workplace has become an essential part of lifestyle in
India over the past decade. McDonald’s, Pizza Hut, Domino’s Pizza, Subway and
Nirula’s fast food chains have outlets in every nook and cranny of large cities. They
efficiently serve burgers, fries, chicken nuggets, hot dogs, sandwiches and drinks to the
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busy person who doesn’t have more than five minutes to spare for his meal. Fast food
has also rapidly gained popularity among the youth ever since its emergence. It is the
youth’s idea of a quick and tasty lunch on-the-go.

Why fast food?

It’s tasty, economical and only a drive-through or phone call away.

EMERGENCE

In India, fast food culture emerged in the decades after independence, starting from the
1950’s. Eating at home used to be a significant aspect of Indian culture, so the change
was gradual. Over a period of time, with a growth in the number of nuclear families,
economic growth and increasing per capita income as well as globalization, fast food
culture gained prominence. Women were shifting from their conventional roles of
managing the household and taking care of the children. With growth in literacy, they
started joining the workforce in large numbers. Fast food became a time-saving
alternative to cooking for them.

Similarly, children resorted to fast food to fill their stomachs in school and college.
Their exposure to global urban culture and Western cuisine accelerated their want for
cheap and delicious fast food. Moreover, fast food costs less than traditional long meals
commencing with appetizer and concluding with dessert.

Nirula’s and Pizza Corner – India’s most popular domestic fast food chains – gained
rapid popularity during this period. Though the fast food culture originated abroad,
these domestic food chains could create a perfect blend of international food with
Indian ingredients. Paneer pizzas and aloo tikki burgers were indeed able to satisfy
Indian taste buds.
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With the liberalization of the economy in 1992, new multinational fast food giants
started dotting India with their outlets. Burger King, Wimpy’s, Pizza Hut, Domino’s
Pizza, McDonald’s, and KFC outlets can be seen today in nearly every shopping mall
and other public areas. In fact, these multinationals have given their domestic
counterparts a run for their money. They are growing at a much faster pace than the
Indian chains.

REASONS FO EMERGENCE

Gender Roles: gender roles are now changing. Females have started working outside.
So, they have no time for their home and cooking food. Fast food is an easy way out
because these can be prepared easily.

Customer Sophistication and Confidence: consumers are becoming more

sophisticated now. They do not want to prepare food and spend their time and energy
in house hold works. They are building their confidence more on ‘ready to eat and easy
to serve’ kind of foods

Paucity of Time: people have no time for cooking. Because of emergence of working
women and also number of other entertainment items. Most of the time either people
work or want to enjoy with their family.

Double Income Group: emergence of double income group leads to increase in

disposable income. Now people have more disposable income so they can spend easily
in fast food and other activities.

Working Women: working women have no time for cooking, and if they have then
also they don’t want to cook. Because they want to come out of the traditionally defined
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gender roles. They do not want to confine themselves to household work and
upbringing of children’s.

Large population: India being a second largest country in terms of population

possesses large potential market for all the products/services. This results into entry of
large number of fast food players in the country.

Relaxation in rules and regulations: with the economic liberalization of 1991,

most of the tariff and non tariff barriers from the Indian boundaries are either removed
or minimized. This helped significantly the MNC’s to enter in the country.

Menu diversification: increase in consumption of pizzas, burgers and other type of

fast foods.

IMPACT OF FAST FOOD IN INDIA

The emergence of the fast food industry has, to an extent, transformed urban food
culture in India. The fast food industry is growing at 40% per annum and generates
over Rs. 4800 crores in sales. The multinational segment of the industry generates over
Rs. 7000 crores.

Fast food has, in a way, impacted the Indian economy by creating jobs. Outlets require
a large number of unskilled workers who are willing to work for low wages and this
generates widespread employment.

PLANNING COMMISSION ON FAST FOOD IN INDIA

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Planning Commission - Report of Task force on Employment Opportunities has

emphasised the need for developing the food processing sector which would help
diversify the rural economy and expand employment in the non agricultural sector. It
calls for active involvement of larger units including MNC’s and cooperatives where
possible and have suggested various measures to bring about the desired changes in
this sector by

 Establishment of chain from marketing at the one end to farming at the other.
Major national and international food processing companies should be
approached to ascertain the nature of the problems which limit their activities at
present.

 Do away with the multiplicity of regulations related to food processing which

needs to be integrated into a single Food Act and a single Food Regulatory
Authority.

 An urgent review of the Prevention of Food Adulteration Act is required as its

administration is extremely restrictive to the growth of this sector.

 Government should focus on R&D, information dissemination and development

of rural industrial estates like food parks, logistics centres etc.

A report on Food Security and Nutrition: Vision 2020

A report on Food Security and Nutrition addresses the issues of availability and food
energy intake at household levels. The report focuses on the nutrition and calorie intake
with required norms and has called for the private participation to ensure the
availability of healthy nutritive food for the urban and rural masses thereby eradicate
the instances of malnutrition from the country.
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Strategic Intervention by The ministry of Food Processing Industry:

The Ministry has to be strengthened appropriately, to meet the challenges in

implementing various new initiatives proposed for energizing the food-processing
sector in the country.

The priority areas identified for intervention therefore are:

 Infrastructure development

 The food park scheme is proposed to be modified into a scheme for an

Integrated Food Zone/Mega Food park

 Modernization of Abattoirs and setting up of National Meat Board

 Cold Chain, Value Addition and Preservation infrastructure (Cold storages,

Reefer vans

 Irradiation Centres

 Research and development – Products, Technology, Quality and Skills

 Capacity Building – Human Resource Development, Research & Development,

Quality, Safety, Related Infrastructure

 Implementation of Food Safety and Standards Act, 2006.

 Establishment of NIFTEM

 Modernization of PPRC, Thanjayur into a National Crop Processing Center

 Upgrading safety and quality of street food and establishing food streets in
identified

 Wine Sector Development- Establishment of Wine Board

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PROBLEMS OF FAST FOOD INDUSTRY

There are some problems fast food industry is witnessing now a day’s which are listed
as under:

Environmental friendly products cost high: Government is legislating laws in

order to keep check on the fast food industry and it is emphasizing more on the usage of
bio-degradable and environment friendly products. But associated with this issue is the
problem that fast food player faces - the cost associated with the environment friendly
product. They cost much higher than the normal products that companies uses for
packaging or wrapping their products.

Balance between societal expectation and companies economic

objectives: To balance a society’s expectation regarding environment with the
economic burden of protecting the environment. Thus, one can see that one side pushes
for higher standards and other side tries to beat the standard back, thereby making it a
arm wrestling and mind boggling exercise.

Health related issues: obesity: Studies have shown that a typical fast food has very
high density and food with high density causes people to eat more then they usually
need.

Overall, the fast food industry has been very successful in India, both in financial terms
as well as in popularizing its quick service culture among the population.
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EXECUTIVE SUMMARY
WAFFLE NOW!

Franchises continue to be the most secure form of small business start-up, requiring
less money and less risk than a brand new venture. The franchiser often supplies
assistance, ranging from financing to hiring and training staff. This plan details a
fastfood franchise that specializes in quick and healthy Waffle dishes.

The market demand has never been greater for food that is healthy, economically
priced, and great tasting. India is a market with wide open potential for growth.
Traditionally, Waffle has been consumed in the morning as a breakfast food item but
we see Waffle has the potential to be at the center stage as a product that both tastes
good and is good for you, Waffle Now! has positioned itself to provide the services in
demand by the Indian consumer: a variety of healthy Waffles, moderately priced and
with very good taste. The basic focus is to provide the consumer with a healthy, quality
meal which is economically priced. This is a concept that will never grow old.

Waffle Now! is a franchise system with ongoing support from the national franchisor.
National assistance includes site selection, restaurant design, comprehensive training,
and support of ongoing operations through marketing assistance, quality control
programs, research and development.

Waffle Now! of Mumbai, India will require a total financial commitment of Rs. 50,00,
000. The franchise fee for the Mumbai Fountain store will be Rs 5, 00,000, with an
additional Rs 7, 50,000 to purchase the rights for all of South Mumbai A, B, C and D
ward. The remaining money will be used in opening the first Mumbai store at Fountain
in Fort Area.

Waffle Now! of Mumbai will have the right to sell stores throughout Maharashtra and
India. As these additional franchises are sold, Waffle Now! will retain Rs 3,75,000 of
each franchise fee paid. Monthly royalties from each of these Mumbai stores will be 3%
of gross.
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DESCRIPTION OF BUSINESS
PRODUCTS/SERVICES

The Waffle Now! menu is centered around a variety of Waffle dishes with a variety of
sauces. For diversity, Waffle Now! also offers mini pizzas, sandwiches and a selection of
salads. Waffle Now! menu items are available for eat-in or take-out. Waffle Now! also
features a complete party menu. Catering for any size occasion is available.

The service will be exceptional. The#l goal of each employee will be customer
satisfaction. Waffle Now! believes in the motto, "the customer is always right." In
today's society, where customer service is often lacking (or nonexistent), we will
structure our business to provide the best service possible in a friendly, helpful
atmosphere.
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GEOGRAPHICAL AREA

Waffle Now! will draw customers primarily from Mumbai, with some penetration in to
neighboring areas.

Waffle Now! will draw on the Mumbai community's growing reputation as a Central
Business District. Waffle Now! franchises are structured to operate in areas with
populations between 200,000 and 300,000 people.

There are no physical limitations to the market area since the Mumbai location is well
served by all means of transportation. There are many competing, well-established fast
food outlets in the area; however, none of them are currently providing a similar
product.

MAJOR CUSTOMERS

Waffle Now! relies on customer volume mainly those who are employees working in an
organization in an around the Central Business District of Mumbai. The major
customers group can be categorized as:

• Office Staff
• State employees
• School Children
• College Students
• Tourist
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FACILITIES/EQUIPMENTS

Waffle Now! is structured to operate in strip mall-type locations. The corporate

headquarters provides detailed site selection assistance, including lease negotiations.

Waffle Now! is designed to function in a 500 to 1000 square-foot store. A drive-up

window can be utilized if a suitable site for such is located.

Prospective sites which have been preliminarily identified include; The east west Metro
Rail Corridor from Versova to Ghatkopar which includes prime stations like Andheri,
Chakala , Saki Naka etc.

The equipment necessary for the operation of Waffle Now! Will be purchased from any
of the several restaurant supply companies located in Mumbai and New Delhi.

ORGANIZATION

Waffle Now's staff will be divided into two functional areas, Operations and
Administration. Each division will he headed by one of the principals.
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MARKET ANALYSIS
GEOGRAPHY/DEMOGRAPHICS

The national trend toward eating out has increased over the last 5 years. In 2005, the
amount of money spent on eating out was equal to what was spent for consumption
inside the home. This is the first time that consumers spent as much for "eat out" food
as they did for "at home" food. The market demand has never been greater for food that
is healthy, economically priced, and great tasting. The recent health-oriented menu
options added to national chains like Mc. Donalds and Pizzahut, point to the nation's
desire for healthy food. In an analysis of dining, Restaurant Business Magazine noted
that Indian families specially those living in the urban cities of Mumbai, Delhi,
Bangalore, Hyderabad and Pune are becoming food conscious and prefer having a food
which is healthy, tasty and easy to digest. With that realization has come more
emphasis on healthy dining alternatives like Waffle.

CUSTOMERS

The customers for restaurants in the geographical area served by Waffle Now! can be
categorized as follows:

• Office Staff
• State employees
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• School Children
• College Students
• Tourist

There are several identifiable characteristics of the market area that determine the
segmentation as listed. Since this area is well known for the office premises, the office
employees that usually travel from Mumbai Suburbs in the morning rush often have
breakfast and lunch out which they find it convenient and affordable. Also Fort area has
residential lanes, and the families living there are outgoing and tend to dine out usually
on weekends. According to Indian Demographics Magazine, families in Mumbai eat out
an average two to three times per week.

Moreover Fort Area boasts of as many as 8 schools and 7 Colleges in and around Fort.
Hence the school children and collegiate are in good numbers in this area and have
their meals outside.

Since South Mumbai is such a busy area, there are a large number of tourists and state
employees who are looking for a place to take lunch. Waffle Now! can satisfy their
needs.

ASSUMPTIONS

The strategic goals and plans for Waffle Now! are based on the following assumptions:

The national and local trends toward consumption of healthy food will continue. All
indications from national publications consulted agree that healthy food which is
reasonably priced will continue its popularity well into the next century.

The trend toward dining out will remain steady. Indications are that dining out will
actually increase over the next five to seven years.
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SUPPLY & DEMAND

The restaurant industry in the India has been characterized by rapid change. During the
50's and 60's, dining out was a new experience for a country feeling the effects of
independence. Also, the various wars have increased the awareness of many Indians
with foods from different cultures. This has spawned a trend toward restaurants
featuring food from Europe and America.

An Indian original, the dinner, spread across the country and soon evolved into chain
restaurants operated by local and regional corporations. During this period, a new
restaurant concept grew up from the udipi restaurants and sandwich stands. The fast
food restaurant was started from such humble beginnings and quickly multiplied.

Over the next two decades fast food matured and changed at the same time to meet the
changing tastes of the public.

While fast food chains experienced significant growth, restaurants evolved also. During
the late 60's and 70's, "natural" food restaurants became popular, only to give way to
nouvelle cuisine in the 1990's. The trend in the 2000's is to healthy food low in fat,
cholesterol and sugar.

The national restaurant industry includes approximately 125,000 restaurants plus

235,000 fast food restaurants, according to the National Restaurant Owners
Association (NROA). NROA estimates that combined restaurant sales reached 4.5
billion Rupees last year.

The local market reflects the national trends. As Waffle has moved to the center stage as
a product that both tastes good and is good for you, Waffle Now! has positioned itself to
provide the services in demand by the Indian consumer: a variety of healthy Waffles,
moderate price, and very good taste.

GROWTH FACTORS
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The number of restaurants will grow at an annual rate of 9-10% for the next five years
according to the estimates from National Restaurant Owners Association.

The growth can be attributed to many factors, such as a continued trend toward two
income families, thus eating out more for lunches and having little time to prepare a
meal after work. The biggest potential for growth involves food prepared for
consumption, or take-out food. As the name Waffle Now! implies, we are positioned to
take advantage of either market segment.

The local population with regards to Fort area is steady but we see a more influx of
people who have shifted to Mumbai in search of Jobs and hence the working population
in the Mumbai Metropolitan region has seen a continuous uptrend over a last decade
and the trend is likely to continue in the coming years with new infrastructure for
commercial and residential purposes taking place throughout this region.

PRODUCT LIFECYCLE

The restaurant industry is in a rapidly growing phase. Although this growth trend
means opportunities for increased sales volume and higher profit margins, overhead
must be closely monitored. The importance of quality control, purchasing, low
overhead, advertising and marketing cannot be overstated.

At all of the Waffle Now! franchise locations, customer loyalty has been developed
through its excellent service and popular menu. Attention must be paid to trends,
however, and changes should be made early in both the menu and the decor before
customers become bored and move on to a newer experience.

PRICE STRUCTURE

Waffle Now! is structured to present good food and reasonable prices. As such, Waffle
Now! operates with food costs at 34% of gross. This figure is somewhat higher than
industry standards for the same type of menu; however, Waffle Now! strives to
maintain affordable prices. Waffle Now! will keep menu prices at reasonable levels to
attract the largest share possible from its demographic base.
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MARKETING PROCESS

Waffle Now! will market the food and service of its restaurant using a custom designed
campaign by the Lowe Lintas Advertising agency in Mumbai.

Advertising campaigns will utilize newspaper, radio, Email and direct mail coupon
marketing. Waffle Now! also markets its catering services through SMS advertising to
local businesses.

The ad agency has developed several creative direct mail promotions for use throughout
the Waffle Now! system.

COMPETITIVE ANALYSIS
Waffle Now! will have no direct competition in the Mumbai market. City records show
that there are a total of 89 businesses listed in the broad category of restaurants. Of
these, 12 feature some form of Waffle as a menu item. None of the local restaurants
specializes in quality Waffle at affordable prices in a fast food setting. However there
are many fast food chains which are operating aggressively in Mumbai, the profile of
some are provided below.

KENTUCKY FRIED CHICKEN

About the Company

KFC Corporation, or KFC, founded and also known as Kentucky Fried Chicken, is a
chain of fast food restaurants based in Louisville, Kentucky. KFC is a brand and
operating segment, called a "concept" of Yum! Brands since 1997 when that company
was spun off from PepsiCo as Tricon Global Restaurants Inc. The restaurants are
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known as Poulet Frit Kentucky or PFK in the province of Quebec in Canada. In France,
however, the chain is known as KFC. KFC primarily sells chicken in form of pieces,
wraps, salads and sandwiches. While its primary focus is fried chicken, KFC also offers
a line of roasted chicken products, side dishes and desserts. Outside NorthAmerica,
KFC offers beef based products such as hamburgers or kebabs, pork based products
such as ribs and other regional fare.

Products

The famous paper bucket that KFC uses for its larger sized orders of chicken and has
come to signify the company was originally created by Wendy's restaurants founder
Dave Thomas. Thomas was originally a franchisee of the original Kentucky Fried
Chicken and operated several outlets in the Columbus, Ohio area. His reasoning behind
using the paper packaging was that it helped keep the chicken crispy by wicking away
excess moisture. Thomas was also responsible for the creation of the famous rotating
bucket sign that came to be used at most KFC locations in the US.

Menu items

KFC's specialty is fried chicken served in various forms. KFC's primary product is
pressure-fried pieces of chicken made with original recipe. The other chicken offering,
extra crispy, is made using a garlic marinade and double dipping the chicken in flour
before deep frying in a standard industrial kitchen type machine.

Kentucky Grilled Chicken - This marinated grilled chicken is targeted towards health-
conscious customers. It features marinated breasts, thighs, drumsticks, and wings that
are coated with the Original Recipe seasonings before being grilled. It has less fat,
calories, and sodium than the Original Recipe fried chicken.

KFC Business Strategy

KFC fast-food chains are currently under the restaurant division of PepsiCo
Incorporated. Some major threats include the changing attitudes of society toward
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healthier eating habits, KFC has more than 9,800 outlets located in 77 countries. In
marketing, KFC restaurants are not restricted from locating within close proximity of
other KFC restaurants. There are two alternative strategies for KFC. The first strategy
involves keeping PepsiCo beverage division and snack foods division together, and a
divestiture of PepsiCo restaurant division; selling Taco Bell, Pizza Hut, and KFC.

Strengths

Strengths can be found internally in a company and can be used to the company’s
advantage. The strengths identified are as follows:

1. KFC's secret recipe.

2. Name recognition and reputation.

3. PepsiCo's success with the management of fast food chains.

4. Traditional employee loyalty.

5. Improving operating efficiencies by reducing overhead and

Weaknesses

Weaknesses are also found internally like strengths. Weaknesses, however, can limit a
company’s potential. The weaknesses for KFC are identified as follows:

1. The many sales of KFC lead to a confusing corporate direction.

2. KFC has a long time to market with new products.

3. Conflicting cultures of KFC and Pepsi Co.

Problems
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Through an analysis of the strengths, weaknesses, opportunities, and threats of KFC,

the following potential problem areas were identified:

1. No defined target market.

2. Health Conscious Consumers.

3. Increased Start Up Costs.

DOMINO’S PIZZA

ABOUT THE COMPANY

Domino's Pizza is one of the biggest and fastest growing international food joints in
South Asia. The very first Domino's Pizza outlet in India opened in Jan, 1996 at New
Delhi. Today, Domino's Pizza India has become a wide network of Pizza delivery and
food chain. There are close to 220 outlets in 42 cities of India and the brand is the top
most among the food delivery business. Domino’s Pizza outlets can be seen at major
locations of Delhi and NCR. Their home delivery is free with a guarantee of “Thirty
Minutes Nahi to Free”. Although they are expert in delivering Pizzas on time, their
eating joints and outlets are also good. They plan to have a total of 500 stores in 75-80
cities by 2010 to 2011. It would entail an investment of Rs 200 million during the
period.

MARKET GROWTH

During last four months, dominoes have opened outlets in Jammu, Panipat, Surat,
Baroda, Nashik, Trivandum, Meerut and Patiala. While earlier, 70 percent of our
business used to be in metros and mini-metros, now the ratio is 50:50 between big
cities and smaller Tier II and III cities. Domino’s Pizza is expanding its base in India by
opening 500 outlets to add to its current tally of 156 outlets, across 50 cities in India by
2011 with an investment of Rs.1, 000 crore.

MARKET STRATEGIES
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1. Promotional and Advertisement Campaigns(Coupons and discounts)

2. The '30 Minutes' Promise

3. Use of Technology(Digital interactive Television, Internet on the PC, Mobile

telephony)

4. Premium Pricing Strategy

5. Indian fast food industry and entry of multinational players

6. Distribution strategies of fast food chains in India

MARKET SHARE

The organized pizza market in India is worth Rs.500 crore and Domino’shas a
substantial 45% market share, and registered a healthy growth of 60% over last year.
The main target for new outlets shall be metro cities though Tier II cities would also
receive a fair amount of attention. Currently Domino’s sells around 35,000 pizza every
day, of which around 1% are given free on account of its “30 minutes or free” model. 65
percent of its revenue comes from home delivery service; around 35percent is from
sales in premise.

Mc. DONALD’S

McDonald's is the leading global foodservice retailer with more than 31,000 local
restaurants serving more than 58 million people in 118 countries each day. More than
75% of McDonald's restaurants worldwide are owned and operated by independent
local men and women. The powerful combination of entrepreneurial spirit and System
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wide alignment around their Plan to Win enables them to execute the best ideas with
both large-scale efficiency and local flair.

PRODUCTS

McDonald's predominantly sells hamburgers, various types of chicken sandwiches and

products, French fries, soft drinks, breakfast items, and desserts. In most markets,
McDonald's offers salads and vegetarian items, wraps and other localized fare. Portugal
is the only country with McDonald's restaurants serving soup. This local deviation from
the standard menu is a characteristic for which the chain is particularly known, and one
which is employed either to abide by regional food taboos (such as the religious
prohibition of beef consumption in India) or to make available foods with which the
regional market is more familiar (such as the sale of McRice in Indonesia).

ADVERTISING

McDonald's has for decades maintained an extensive advertising campaign. In addition

to the usual media (television, radio, and newspaper), the company makes significant
use of billboards and signage, sponsors sporting events ranging from Little League to
the Olympic Games, and makes coolers of orange drink with their logo available for
local events of all kinds. Nonetheless, television has always played acentral role in the
company's advertising strategy.

ADVANTAGES FOR WAFFLE NOW!

HEALTHY FOOD
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The current fast food market does not provide for fast healthy food. Waffle Now! fills
that void by allowing customers to obtain fast food which is healthy for them and their
children.

PRICE

Waffle Now! offers food at lower prices than typical sit-down Indian restaurants.

SERVICE

Waffle Now! will operate with the motto "the customer is always right." In today's busy
world, the customer service aspect of the restaurant business is often overlooked.

UNTAPPED MARKET

Waffle Now! will offer an alternative not currently available in the Mumbai area.

DISADVANTAGES FOR ESTABLISHMENT OF WAFFLE NOW!

NAME RECOGNITION

As a fast food outlet, Waffle Now! does not have the name recognition of other national
chains.

NEW FOOD CONCEPT

American food in general, and more specifically Waffle, are new concepts in fast food.

RENTAL COSTS

Prime rental locations are extremely costly.

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INTERVIEWS WITH FOOD CHAIN BUSINESS

MANAGEMENT

Interviews with the industry experts and those people directly involved with the
activities of food business is perhaps the best way to know this business and get the feel
of the food market they are serving. Often we come across the views which are quite
simple but forms the fundamental basis of their business activities.

In an interview with Mr. Mohinder Rasam who is the Manager in charge of Mc.
Donalds CST Fort outlet and has a working experience of more than 8 years shared his
experience of of fast food business. He said, it was a totally new industry for him to
work with. Initially he personally felt food food business of Mc. Donalds will take time
to settle down in India and create a customer base to the taste of offering of Mc.
Donalds. But the start was really good as they received very good response in the
metropolitan cities of India like Mumbai.

When asked about the potential of this industry viz-a-viz Mc. Donalds, he was
optimistic about the food industry and said Mc. Donalds is positioned very well and it
caters to the vast set of consumers. We have understood the taste and food habits of the
people here and our future offerings would be more in line with the regional taste of
India.

With regards to competition, he said there is a stiff competition in the industry. We

have different menu compared to our competitors and we are masters in our offerings.

But still we are trying our best to improvise on our services and would make all efforts
to improve our customers’ base through better product and service.

In a short interview with Mr. Balavaity, who is in this industry for more than 50 years
now and manages the South Indian chain of restaurants Shivala in Mumbai, food
business will never go out of business till the time there are people to feed. And
population is increasing on a daily basis in a busy city like Mumbai. So it’s a flourishing
business as it was, it is and it would be. Asked about his secret of management and
 P a g e | 30

success, he said my success recipe is hygiene and quality food, these two factors are
most looked upon by the consumer and appreciate them a lot.

Hence from the above interviews, we can conclude that food business is a thriving
business in India and throws open lot of opportunities keeping in mind the growing
population of this country.

DESIGN & DEVELOPMENT PLANS

GOALS

Goal 1

Opening of first Waffle Now! in Mumbai by October 1 of 2011.

Goal 2

Achieve Rs 2.5 – 3.00 Crores in gross sales in the first year of operation.

Goal 3

Sell 12 additional franchises within the first 7 years of operation.

RISK ANALYSIS

The following risks are inherent in the pursuit of the stated goals:

• The lack of name recognition in our area will impede sales potential.
• Attracting potential franchise owners will be difficult.
 P a g e | 31

• Opening of our first store will be dependent on receiving financial assistance

through loans.

EVALUATION METHODS

Waffle Now! will evaluate the achievement of its stated goals by measuring financial
factors.

Waffle Now! will monitor monthly sales volume as compared to monthly operating
costs. Monthly increases will be expected in the gross sales category.

Sales of additional franchises will be measured by the actual opening of new stores in
Mumbai. Contacts with potential franchisees will be measured in terms of the number
of inquiries obtained on a monthly basis.

STRATEGIC ACTIONS

Strategy 1

The goal is to open the first Waffle Now! in Mumbai by October 1, 2011. The area is
growing rapidly and presents many opportunities to take advantage of the shopping
market.

Strategy 1 calls for finding financing to the level necessary to satisfy our needs. The
estimated level necessary to accomplish this goal is Rs. 32,50,000 to Rs 50,00,000.

Additionally, a location will need to be secured. Location assistance is provided by the

corporate headquarters. Location considerations include traffic patterns and counts,
immediate area demographics, and location of a suitable strip mall facility.

Strategy 2
 P a g e | 32

The goal is to achieve Rs 2.5 – 3.00 Crores in gross sales in the first year of operation.
This will be accomplished through a marketing plan which is constructed by the
corporate office. The franchisor requires that 4% of the monthly gross be spent on
advertising. 2% of this goes directly to a local marketing campaign. The remaining 2%
goes to the corporate headquarters to be used to develop radio and print material for
our local franchise stores. The plan includes advertising, direct mail marketing and
promotional activities. In addition, corporate headquarters structures food preparation
and management styles to maximize profit while keeping the overhead to a minimum.

Strategy 3

The goal is to sell 12 additional franchises within a seven-year period. This will be
accomplished through an extensive training program by the president of the
corporation. In addition to the sales assistance provided by the corporate headquarters,
a franchise consultant has been retained.

SCHEDULE/TIMETABLE

Schedule for Goal 1 - Opening of first Waffle Now! in Mumbai.

Develop a business plan for presentation to bank/investors by April 14.

Finalize franchise and master franchise agreement with corporate headquarters by

April 17.

Await approval of financing and obtaining of funds. Deadline is May 15.

Complete all preliminary administrative work, such as incorporating, etc. by May 15.

Review traffic studies and demographic information. Consult with corporate

headquarters regarding site selection. Site selection committee from corporate
headquarters to visit area. Negotiate lease and leasehold improvements. Deadline by
June 30.
 P a g e | 33

Remodeling of site location to specification of Waffle Now! by August 15.

Obtain bids for supply of inventory and equipment (including signage) from various
local restaurant supply companies. Select best company and set delivery date by
September 1.

Receive delivery of equipment by September 10.

Obtain marketing package from corporate headquarters advertising agency and

customize to our local by September 1.

Printing of all menus, forms, and promotional items by September 15.

Arrange local advertising for grand opening celebration by September 15.

Hire and train employees during soft opening period from September 15 to September
30.

Grand opening on Monday, October 1, 2011.

Schedule for Goal 2 - Achieve Rs 2.5 – 3.00 Crores gross sales in first year.

Evaluate monthly sales to provide for increases on a monthly basis, allow for seasonal
adjustments.

Review entire operation and make recommendations for improving sales. Deadline
January 5, 2012.

Review menu for items which are popular and unpopular, make adjustments
accordingly. Deadline February 15, 2012.

Implement new PTA marketing plan by end of February, 2012.

 P a g e | 34

Schedule for Goal 3 - Sell 12 additional franchises within seven years.

Obtain training in the sale and finalization of franchise selling by March 30, 2012.

Develop advertising material for the sale of franchises for use in local and regional
publications by April 15, 2012.

Provide for immediate response to inquiries for interest in franchise purchase.

Make a minimum of five presentations on a quarterly basis for individuals or

corporations interested in purchasing a Waffle Now! franchise.

OPERATIONS & MANAGEMENT PLANS

PRESIDENT:

The President of Waffle Now! Chain business will initially have the responsibility for
managing the operations in Mumbai and Maharashtra but will gradually cover the
subcontinent of India. The role will involve both ongoing relationship management and
new business development opportunities for an account that generates significant
revenue.

Key Responsibilities:

 Develop sales plans

 Improve account / product profitability
 Present brand plans to the customer
 Agree profitable promotional activity based on current capacity availability and
financial data.
 P a g e | 35

 Utilise market data to seek out incremental opportunities based on Gap analysis.
 Use SAP to accurately forecast sales by customer/product/week.

Skills Required

 Previous experience of successfully working in a role dealing with the Food

Chain Multiples.
 Ability to interpret data and negotiate contracts
 Highly developed interpersonal skills with the ability to develop strong business
relationships
 Ability to develop strategic sales plans and follow through.
 Highly values driven individual : proximity, integrity, nourishment, excellence
 Collaborative, consultative in style; a team player.

 A real passion for food.

MANAGERS:

Fast food management is a large industry and would be responsible for managing the
daily activities of franchise restaurants. Managers must be versatile, as they are
required to handle a wide variety of tasks during their shifts at the restaurant.

Cash Management

An important task of fast food managers is the balancing of the cash tills from each
register. The tills must be balanced and bank deposits prepared each day.

Employee Management
 P a g e | 36

Scheduling employees and positioning them at the different food stations which helps
each shift run smoothly in the restaurant. Knowing the strengths of each employee and
staff them properly at each food station.

Deter Theft

Many food products in the fast food industry are expensive and represent a large
portion of the restaurant's operating costs. Preventing employees from stealing or
eating without paying for food helps restaurants control their food cost.

Quality Control

Quality control is an extremely important task that each fast food manager must stay on
top of on a daily basis. Properly training employees, verifying food quality and
reviewing the preparation process are all parts of a manager's quality control duties.

Customer Satisfaction

Fast food managers must ensure that every customer is satisfied with the products and
services supplied by the restaurant. Quickly handling complaints and correcting orders
is an essential part of the manager's day.

HR PRACTICES & POLICIES FOR EMPLOYEES:

A basic principle is that the performance of an individual depends on his or her ability
backed by motivation.

Performance= f (ability × motivation)

At Waffle Now! We will have best HR practices in place which would be designed with
the help of the HR consultants which is at par with the Industry standards in India and
would aim to fulfill the following objectives.
 P a g e | 37

 Enhance the internal capabilities of organization to deal with current and future

change.

 Influence the financial and other performance indicators.

 Energize and encourage the employees to work.

 Increase loyalty of employees towards organization.

 Attract and retain Manpower.

 Reduce Absenteeism.

 Reduce Turnover.

 Aims to improve Customer Experience and Satisfaction.

FINANCIAL COMPONENTS
Sources & Uses

Financial requirements are as follows:

Franchise fee and purchase of area agreement Rs. 11,00,000.00
Equipment package and signage Rs. 17,75,000.00
Initial inventory Rs. 2,00,000.00
Leasehold improvements Rs. 6,50,000.00
Pre-opening expenses, travel and lodging for Rs. 3,75,000.00
 P a g e | 38

training
Grand Opening Rs. 2,50,000.00
Working Capital Rs. 6,50,000.00
Total Financial Requirement Rs. 50,00,000.00

Financing to be obtained through local bank loans or Angel Investors if necessary.

Equity of property owned in Mumbai will be used as partial collateral. Loan term to be
discussed.

Income/Cash Flow Statement

The following income and cash flow statements are based on information supplied by
Waffle Now's corporate headquarters. Figures used are pro-forma; however, they
reflect results obtained at other Waffle Now! franchise locations.

The statement is based on a fiscal year which begins with the opening date of the
business.

Rs in '000'
Projected Income Statements—Best Case
Oct Nov Dec Jan Feb Mar Apr May
Gross Sales
Sales 1,800 1,500 1,650 750 975 1,200 1,425 1,650
Total Sales 1,800 1,500 1,650 750 975 1,200 1,425 1,650
Cost of Sales:
Food/Drink/Spoilage 612 510 561 255 332 408 485 561
Total Cost of Sales 612 510 561 255 332 408 485 561
Gross Profit 1,188 990 1,089 495 644 792 941 1,089
 P a g e | 39

Expenses:
Accounting 5 5 5 5 5 5 5 5
Advertising Local 36 30 33 15 19.5 24 28.5 33
Advertising National 36 30 33 15 19.5 24 28.5 33
Bank Charges 0.75 0.75 0.75 0.75 0.75 0.75 0.75 0.75
Depreciation 14.6 14.6 14.6 14.6 14.6 14.6 14.6 14.6
Franchise Fee 4.15 4.15 4.15 4.15 4.15 4.15 4.15 4.15
Insurance 9.4 9.4 9.4 9.4 9.4 9.4 9.4 9.4
Interest 31.8 31.6 31.35 31.1 30.8 30.55 30.3 30.05
Legal and Pro. 5 5 5 5 5 5 5 5
Licenses & Permits 0.75 0.75 0.75 0.75 0.75 0.75 0.75 0.75
Office Expense 2.5 2.5 2.5 2.5 2.5 2.5 2.5 2.5
Outside Services 10 10 10 10 10 10 10 10
Rent - Property 134 134 134 134 134 134 134 134
Repairs & Maint. 5 5 5 5 5 5 5 5
Royalties 72 60 66 30 39 48 57 66
Telephone 15 15 15 15 15 15 15 15
Travel 12.5 12.5 12.5 12.5 12.5 12.5 12.5 12.5
Utilities 27.9 27.9 27.9 27.9 27.9 27.9 27.9 27.9
Wages 288 240 264 120 156 192 228 264
Employer's Burden 66 58 62 37.4 43.5 49.65 56 62
Manager Salary 100 100 100 100 100 100 100 100
Misc. 36 30 33 15 19.5 24 28.5 33
Total Expenses 912 826 868 610 674 738 803 867
Net Operating Income 276 164 221 -115 -30.6 54 138 222
Other Income 0 0 0 0 0 0 0 0
Other Expenses 0 0 0 0 0 0 0 0
Net Profit (Loss) Before
Tax 276 164 221 -115 -30.6 54 138 222

Jun Jul Aug Sep Year l % Year 2 % Year 3 %

Sales 1,800 1,875 1,725 1,650 18,000 100.00% 22,500 100.00% 24,750 100.00%
Total Sales 1,800 1,875 1,725 1,650 18,000 22,500 24,750

Food/Drink/Spoilage 612 638 587 561 6,120 34.00% 7,650 34.00% 8,415 34.00%
Total Cost of Sales 612 638 587 561 6,120 34.00% 7,650 34.00% 8,415 34.00%
Gross Profit 1,188 1,238 1,139 1,089 11,880 66.00% 14,850 66.00% 16,335 66.00%
Accounting 5 5 5 5 60 0.33% 75 0.33% 83 0.33%
Advertising Local 36 37.5 34.5 33 360 2.00% 450 2.00% 495 2.00%

Advertising National 36 37.5 34.5 33 360 2.00% 450 2.00% 495 2.00%
Bank Charges 0.75 0.75 0.75 0.75 9 0.05% 11.25 0.05% 12.4 0.05%
Depreciation 14.6 14.6 14.6 14.6 175 0.97% 219 0.97% 241 0.97%
Franchise Fee 4.15 4.15 4.15 4.15 50 0.28% 50 0.22% 50 0.20%
Insurance 9.4 9.4 9.4 9.4 113 0.63% 141 0.63% 155 0.63%
Interest 29.8 29.5 29.25 29 365 2.03% 326 1.45% 281 1.14%
Legal and Pro. 5 5 5 5 60 0.33% 75 0.33% 83 0.33%
Licenses & Permits 0.75 0.75 0.75 0.75 9 0.05% 10 0.04% 11 0.04%
Office Expense 2.5 2.5 2.5 2.5 30 0.17% 37.5 0.17% 41.25 0.17%
Outside Services 10 10 10 10 120 0.67% 150 0.67% 165 0.67%
 P a g e | 40

Rent - Property 134 134 134 134 1,604 8.91% 1,684 7.48% 1,852 7.48%
Repairs & Maint. 5 5 5 5 60 0.33% 75 0.33% 83 0.33%
Royalties 72 75 69 66 720 4.00% 900 4.00% 990 4.00%
Telephone 15 15 15 15 180 1.00% 225 1.00% 248 1.00%
Travel 12.5 12.5 12.5 12.5 150 0.83% 188 0.83% 206 0.83%
Utilities 27.9 27.9 27.9 27.9 335 1.86% 419 1.86% 461 1.86%
Wages 288 300 276 264 2,880 16.00% 3,600 16.00% 3,960 16.00%
Employer's Burden 66 68 64 62 694 3.85% 833 3.70% 928 3.75%
Manager Salary 100 100 100 100 1,200 6.67% 1,300 5.78% 1,500 6.06%
Misc. 36 37.5 34.5 33 360 2.00% 450 2.00% 495 2.00%
Total Expenses 910 931 888 866 9,893 54.96% 11,667 51.85% 12,834 51.85%
Net Operating
Income 278 306 251 223 1,987 11.04% 3,183 14.15% 3,501 14.15%
Other Income 0 0 0 0 0 0.00% 0 0.00% 0 0.00%
Other Expenses 0 0 0 0 0 0.00% 0 0.00% 0 0.00%
Net Profit (Loss)
Before Tax 278 306 251 223 1,987 11.04% 3,183 14.15% 3,501 14.15%

Rs in '000'

Statement of Cash Flows

Oct Nov Dec Jan Feb Mar Apr May
Sales 1,800 1,500 1,650 750 975 1,200 1,425 1,650
Expenses 1,524 1,336 1,429 865 1,006 1,146 1,287 1,428
Depreciation 14.6 14.6 14.6 14.6 14.6 14.6 14.6 14.6
Principal 25.1 25.35 25.6 25.85 26.1 26.35 26.65 26.9
Net Cash
Position 266 154 210 -126 -42.1 41.8 126 210
Previous Cash
Position 650 916 1,069 1,279 1,153 1,111 1,153 1,278
Cumulative
Cash Position 916 1,069 1,279 1,153 1,111 1,153 1,278 1,488

Jun Jul Aug Sep Year 2 Year 3

Sales 1,800 1,875 1,725 1,650 22,500 24,750
Expenses 1,522 1,569 1,474 1,427 19,317 21,249
Depreciation 14.6 14.6 14.6 14.6 219 241
Principal 27.15 27.4 27.7 27.95 358 402
Net Cash
Position 266 293 238 210 3,044 3,340
Previous Cash
Position 1,488 1,753 2,047 2,284 2,494 5,538
 P a g e | 41

Cumulative
Cash Position 1,753 2,047 2,284 2,494 5,538 8,878

Rs in '000'
Projected Income Statements - Worst Case
Oct Nov Dec Jan Feb Mar Apr May
Gross Sales
Sales 1100 916.65 1008.4 458.35 595.85 733.35 870.85 1008.4
Total Sales 1100 916.65 1008.4 458.35 595.85 733.35 870.85 1008.4
Cost of Sales:
Food/Drink/Spoilage 374 311.65 342.85 155.85 202.6 249.35 296.1 342.85
Total Cost of Sales 374 311.65 342.85 155.85 202.6 249.35 296.1 342.85
Gross Profit 726 605 665.5 302.5 393.25 484 574.75 665.5
Expenses:
Accounting 5 5 5 5 5 5 5 5
Advertising Local 22 18.35 20.15 9.15 11.9 14.65 17.4 20.15
Advertising - National 22 18.35 20.15 9.15 11.9 14.65 17.4 20.15
Bank Service Charges 0.75 0.75 0.75 0.75 0.75 0.75 0.75 0.75
Depreciation 14.6 14.6 14.6 14.6 14.6 14.6 14.6 14.6
Franchise Fee 4.15 4.15 4.15 4.15 4.15 4.15 4.15 4.15
Insurance 9.4 9.4 9.4 9.4 9.4 9.4 9.4 9.4
Interest Loan 31.8 31.6 31.35 31.1 30.8 30.55 30.3 30.05
Legal and Pro. 5 5 5 5 5 5 5 5
Licenses & Permits 0.75 0.75 0.75 0.75 0.75 0.75 0.75 0.75
Office Expense 2.5 2.5 2.5 2.5 2.5 2.5 2.5 2.5
Outside Services 10 10 10 10 10 10 10 10
Rent - Property 133.65 133.65 133.65 133.65 133.65 133.65 133.65 133.65
Repairs & Maint. 5 5 5 5 5 5 5 5
Royalties 44 36.65 40.35 18.35 23.85 29.35 34.85 40.35
Telephone 6.25 6.25 6.25 6.25 6.25 6.25 6.25 6.25
Travel 4.15 4.15 4.15 4.15 4.15 4.15 4.15 4.15
Utilities 22.9 22.9 22.9 22.9 22.9 22.9 22.9 22.9
Wages 176 146.65 161.35 73.35 95.35 117.35 139.35 161.35
Employer Burden 46.9 41.95 44.45 29.45 33.2 36.95 40.7 44.45
Manager Salary 100 100 100 100 100 100 100 100
Misc. 22 18.35 20.15 9.15 11.9 14.65 17.4 20.15
Total Expenses 688.85 635.95 662.05 503.8 543.05 582.3 621.5 660.75
Net Opr Income 37.15 -30.95 3.45 -201.3 -149.8 -98.3 -46.75 4.75
Other Income 0 0 0 0 0 0 0 0
Other Expenses 0 0 0 0 0 0 0 0
Net Profit (Loss) Before
Tax 37.15 -30.95 3.45 -201.3 -149.8 -98.3 -46.75 4.75
 P a g e | 42

Rs in '000'
Year Year
Jun Jul Aug Sep Year l % 2 % 3 %
100.00 100.00 100.00
Sales 1,100 1,146 1,054 1,008 11,000 % 13,750 % 15,125 %
Total Sales 1,100 1,146 1,054 1,008 11,000 13,750 15,125

Food/Drink/Spoilage 374 390 358 343 3,740 34.00% 4,675 34.00% 5,143 34.00%
Total Cost of Sales 374 390 358 343 3,740 34.00% 4,675 34.00% 5,143 34.00%
Gross Profit 726 756 696 666 7,260 66.00% 9,075 66.00% 9,983 66.00%
Accounting 5 5 5 5 60 0.55% 75 0.55% 83 0.55%
Advertising Local 22 22.9 21.1 20.15 220 2.00% 275 2.00% 303 2.00%
Advertising -
National 22 22.9 21.1 20.15 220 2.00% 275 2.00% 303 2.00%
Bank Service
Charges 0.75 0.75 0.75 0.75 9 0.08% 11.25 0.08% 12.4 0.08%
Depreciation 14.6 14.6 14.6 14.6 175 1.59% 219 1.59% 241 1.59%
Franchise Fee 4.15 4.15 4.15 4.15 50 0.45% 50 0.36% 50 0.33%
Insurance 9.4 9.4 9.4 9.4 11.25 1.02% 141 1.02% 155 1.02%
Interest Loan 0% 29.5 29.25 29 365 3.32% 326 2.20% 281 1.86%
Legal and Pro. 5 5 5 5 60 0.55% 75 0.55% 83 0.55%

Licenses & Permits 0.75 0.75 0.75 0.75 9 0.08% 10 0.07% 11 0.07%
Office Expense 2.5 2.5 2.5 2.5 30 0.27% 37.5 0.27% 41.25 0.27%
Outside Services 10 10 10 10 120 1.09% 150 1.09% 165 1.09%
Rent - Property 134 134 134 134 1,604 14.58% 1,684 12.25% 1,852 12.25%
Repairs & Maint. 5 5 5 5 60 0.55% 75 0.55% 83 0.55%
Royalties 44 45.85 42.15 40.35 440 4.00% 550 4.00% 605 4.00%
Telephone 6.25 6.25 6.25 6.25 75 0.68% 94 0.68% 103 0.68%
Travel 4.15 4.15 4.15 4.15 50 0.45% 63 0.45% 69 0.45%
Utilities 22.9 22.9 22.9 22.9 275 2.50% 344 2.50% 378 2.50%
Wages 176 183 169 161.4 1,760 16.00% 2,200 16.00% 2,420 16.00%
Employer Burden 46.9 48.15 45.65 44.45 503 4.57% 595 4.33% 666 4.41%
Manager Salary 100 100 100 100 1,200 10.91% 1,300 9.45% 1,500 9.92%
Misc. 22 22.9 21.1 20.15 220 2.00% 275 2.00% 303 2.00%
Total Expenses 687 700 673 660 7,618 69.25% 8,823 64.17% 9,705 64.17%
Net Opr Income 39.2 57 22.65 5.8 -358 −3.25% 252 1.83% 278 1.83%
Other Income 0 0 0 0 0 0.00% 0 0.00% 0 0.00%
Other Expenses 0 0 0 0 0 0.00% 0 0.00% 0 0.00%
Net Profit (Loss)
Before Tax 39.2 57 22.65 5.8 -358 −3.25% 252 1.83% 278 1.83%
 P a g e | 43

Rs in '000'
Statement of Cash Flows - Worst Case
Oct Nov Dec Jan Feb Mar Apr May
Sales 1,100 917 1,008 458 596 733 871 1,008
Expenses 1,063 948 1,005 660 746 832 918 1,004
Depreciation 14.6 14.6 14.6 14.6 14.6 14.6 14.6 14.6
Principal 25.1 25.35 25.6 25.85 26.1 26.35 26.65 26.9
Net Cash
Position 26.6 -41.75 -7.55 -213 -161 -110 -59 -7.55
Prev Cash Pos 650 677 635 627 415 253 143 85
Cum Cash Pos 677 635 627 41.75 253 143 85 77

Jun Jul Aug Sep Year 2 Year 3

Sales 1,100 1,146 1,054 1,008 13,750 15,125
Expenses 1060.8 1,089 1,031 1,003 13,498 14,848
Depreciation 14.6 14.6 14.6 14.6 219 241
Principal 27.15 27.4 27.7 27.95 358 401
Net Cash
Position 26.6 43.7 9.55 -7.55 113 116
Prev Cash Pos 77 104 147 157 149 262.65
Cum Cash Pos 104 147 157 149 262.65 379

CONCLUSION
 P a g e | 44

Food Industry in India has witnessed unprecedented growth and development in the
last decade and presents immense opportunities for the new food business and
concepts to grow and establish. The retail sector is booming up with foreign giants
along with the domestic players coming up with innovative products and widening the
market base of their products portfolio. The retail sector growth has opened up lot of
employment opportunities to the rural and urban masses thereby improving their
productivity and standard of living by way of higher salaries and incentives.

Waffle Now! Aims to join the party and become a profitable venture providing high
quality, low calorie food products at a reasonable rates thereby steadily increasing the
operations and becoming famous and sought after food chain business of India.

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 P a g e | 45

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