Showing posts with label MNC. Show all posts
Showing posts with label MNC. Show all posts

Thursday, February 7, 2013

J. Patrick Doyle, Global President & CEO, Domino’s Pizza

Global President and CEO, Domino’s Pizza,8 talks to b&e’s angshuman paul about the various peculiarities that personify the company’s India operations

B&E: Domino’s Pizza has been into this country for more than a decade. The initial years were slow growth years. Has there been any change in the growth momentum after that?
Doyle: Of course during the initial years, like any other MNC, we too had teething problems and it took us time to understand the Indian market. But that kind of a situation lasted just for two years after we entered India in 1997. Since the early 2000s, we have grown at a very fast rate.

B&E: So what potential do you see in the Indian market? Especially in terms of contribution to the global turnover of the company, where do you want to take the Indian venture?
Doyle: During the last two to three years, India has actually become the fastest growing market for us. India is the most important Asian market for us and Domino’s sees a huge opportunity in India for pizza and pasta. And in terms of contribution to the global turnover of the company, India is amongst the top 10 earners for Domino’s. Currently, India contributes to around 1.5-2% of Domino’s annual global sales – we expect to take it further to a double digit figure. By 2014, we expect India to be among the top five earners – and our concrete plans to achieve this goal are in action.

B&E: The quick service restaurant (QSR) market in India is growing at 25% by CII estimates, and categorically in pizzas, apparently 25,000 pizzas are sold per day in the various corners of the country. Where does Domino’s stand in this? And what strategy are you implementing to cash in on this fiercely growing market?
Doyle: We currently enjoy the leadership position in India in the home delivery segment and we’ve always believed in enhancing this too. This [home delivery] is the USP of our brand and we will retain this further. But yes, as I mentioned, in Indian market, there are lots of new opportunities to explore. For example in the tier II cities there are new markets and not many players are present there. Now, about 20-25% of the revenues for our company comes from tier II and III cities. In the future, therefore, we would be expanding more into such markets.

B&E: Are you referring to your retail presence in these cities? What are your actual retail penetration plans?
Doyle: We have 300 stores in India and in total 9000 stores across the world. In another three years, our target is to have 500 stores in India, apart from the aim of entering newer cities and markets. There is still a huge untapped market in the country to be exploited.

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Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.



 
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Sunday, February 3, 2013

Losing the thunder

Chauhan sold off Thums Up rather desperately

In the 1970s, the Coca Cola Company decided to abandon operations in India. To capitalise on the growing market, the then Parle brothers, Ramesh Chauhan and Prakash Chauhan, rolled out Thums Up, Limca and Gold Spot. Thums Up enjoyed a monopoly, overshadowing other players. Pepsi and Coke reentered in the 1990s but found it tough to compete with Thums Up (40% market share). Both offered to take over Thums Up. Fund constraint was a major hindrance for the Chauhans and then there was the challenge of creating a wide network to compete with the MNCs. Affirms Ramesh Chauhan to B&E, “It was difficult to create the franchise model required in the carbonated drinks business. And I had no other option.” Finally in 1993, Thums Up was sold to Coke for a mere $60 million. Coca Cola later acquired Limca too, and used these brands quite effectively to corner Pepsi.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.
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Thursday, January 10, 2013

In the lair of adephagia

there was hardly anything ‘fast’ in the manner in which this fast food chain spread its reach in the indian market. but mcdonald’s would still look back at the past 19 years with satisfaction, for indians have accepted them quite well

She did it again! It’s quite well established now that there is a lot that US Secretary of State Hillary Clinton looks forward to whenever she visits India. And Indian food definitely figures up there on the list. That is why, when she came to the Taj Palace in New Delhi during the current visit, she had an extended 2 hour dinner session, where she got to taste the best of Indian cuisine, one of the main reasons why she made headlines in her previous visit as well.

Visiting India and enjoying Indian cuisine is one thing. But when it comes to bringing cuisine from back home to tantalise Indian taste buds; well… MNCs haven’t exactly been having a ball there, have they? Firstly there is the tremendous competition that MNCs have with traditional Indian food. That’s where many failed at the onset – to adapt their tastes to Indian likings and sensitivities. Moreover, careful planning was missing in most of the forays, so was the kind of investment that is needed to sustain in this market; where breaking even can take what seems like eternity. And price… who can forget price? They made strong attempts to make Indians adjust to their pricing norms, but in fact ended up adjusting their own. Brands like KFC and Domino’s, therefore, learned the hard way. But the most recognisable Quick Service Restaurant (QSR) brand in the world – McDonald’s, was a notable exception.

As journalist John F. Love points out in his book – McDonald’s – Behind the Arches, that in the 1950s, McDonald’s realised the importance of logistics and supply chain to maintain the consistency of the brand. While the initial aggressive approach followed by most American MNCs ultimately gave way to a humble growth model, the McDonald’s headquarters at Oakbrook had other plans for India. The company has always had the policy to wait for as long as possible to find the right franchisee along with a sturdy supplier base, before entering any country. Critics have lambasted it for running bullock carts in the era of jet planes. But its patience is showing results, as it’s the only American MNC in the fast food chain business that has seen success from day one and reached break even in 17 years in India.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
For More IIPM Info, Visit below mentioned IIPM articles.
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