Comparative Analysis of Major Fast Food Joints in India

INTRODUCTION
Origin of the fast food market in INDIA
Traditionally over the ages, fast food for the average Indian customer
meant having breads i.e., paranthas, rotis etc. with sabzi or achaar.
These were the traditionally available snacks or in the form of samosas
etc. All the items were available at the roadside dhabas or the local
sweet shops. There were no established eating places or restaurants for
the average Indian customer.
It was the Nirulas family way back in 1920’s that started the trend of
opening good eating places in the city. Nirulas initially when they entered
the restaurant business, were more into catering and hotel business. It
was only in the late 50’s and early 60’s that they decided to open up a
restaurant serving snacks and fast food. By 70’s they had a pastry shop,
snack place and Hot Shoppe. This started the trend of eating joints in the
city and over the country. Nirula’s was considered to be the pioneer in
fast food business. Seeing its success in the country other local fast food
joints and restaurant started coming up in the 80’s. With the coming up
of these local joints Nirulas was not left behind. It had a well-established
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ICFAI BUSINESS SCHOOL HYDERABAD
fast food chain over the next decade. However seeing the potential in
the country in the 90’s due to the changing life styles, the established
chains world over made their entry into the Indian food market.
However the tastes and the style of the kind of food which these MNC’s
were offering the Indian customer has been made familiar to them by
Nirula’s only.
Although the concept was introduced to the Indians way back, but in the
true sense market for fast food has been developed only after the entry
the various MNC’s starting with Wimpys to McDonald’s, Pizza Hut, TGIF,
Dominos etc., with many more to come over the next few years.
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THE INDIAN FAST FOOD MARKET - AN OVERVIEW
Upto the year 1995 Indian food market was predominantly dominated by
the traditional dhabas, potential restaurants in the customer’s colony
and some restaurants in a five star hotel. Having fast food i.e., burgers,
pizzas etc., was considered to be an option for eating out. It was not at
all synonymous with the American concept of fast food as a quick
takeaway bite or a substitute for lunch.
Apart from fast food being available at the local colony restaurants and
at some five star restaurants, Nirulas was the only fast food chain
existing in the country with its restaurants expanding with every passing
year since its inception. It has been almost 50 years now since its set up
and there is hardly any one who doesn’t know that Nirulas exists. Nirulas
was the first one to bring fast food to India back in the 50’s since then it
has evolved into an eating place with a tremendous brand equity and
brand recognition. It proved to be a perfect eating place for an average
middle class who wants to eat out at an affordable price who cant afford
the five-star restaurants and would not want to go to the local dhabas.
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Nirulas almost had a monopoly for decades due to the way it has been
placed. It is a place where a person from an average middle class group
to upper class group can go to eat out. Its popularity has increased over
the decades. With the trends changing and the incomes rising almost
anybody who can afford to eat out could go for a snack at Nirulas.
However the year 1995-96 witnessed a drastic change. 1996 is
considered to be the year of India’s entry into the world food market.
International giants such as McDonalds, KFC, TGIF, Dominos, Pizza Hut
all bombarded the Indian food market.
Before these, UK-based joint called Wimpy’s had established its chain in
the country in 1990. By year 1996 it had about three to four joints
established in Delhi. However it did not pose much of a threat to Nirulas
reason being lack of variety and that Wimpys was looked at more of a
hangout place rather than eating out with the family.
Its been the American international giants i.e., McDonalds, Pizza Hut etc.,
who have targeted their restaurants to the families. Apart from the
foreign and Indian fast food chains setting up shop, there are a range of
specialty restaurants offering varied fare such as Chinese, Mexican,
French, Italian etc. These places however offer range of items different
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from burgers, pizzas etc, but they definitely are competition to both
foreign and Indian fast food chains.
However, restaurant business is such which is surrounded by threat from
everywhere be it Indian joints or foreign joints.
It is only these international joints and specialty restaurants which are
gradually coming up and some Indian restaurants which have made up
the food market. Prior to this it was only the local restaurant that
became visible while passing by or through local banners etc., and the
five star restaurants were for the elite class out of reach by the average
middle class customer. There was hardly any awareness or promotion to
beat competition.
Each of the foreign food joints that have come into the country has their
own strategy lined up to differ from the rest. Each of these studied the
Indian tastes and style and thereby targeted the Indian customer. An
average Indian restaurant goer is no convenience eater, unlike the
Americans.
If he is paying, he is paying for food that tastes good (Spicy, soft, savory
etc.), not for how pleasantly the stuff is served or how spotless the
widows are. He wants food for that can make him come back to the
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restaurant. An Indian food joint owner would definitely understand this
but an American company, which comes and places it directly without
knowing the customer is definitely in for trouble. Customer loyalty in a
restaurant business is essentially low. A customer when he comes to a
restaurant usually looks at the quality of food, variety, ambience, speed
of delivery and the location. The variety would influence the frequency
of visits since taste is a dominating factor to the Indian customers.
Almost all the fast food chains both Indian i.e., Nirulas and foreign i.e.,
McDonalds etc., are targeting the families. This serves to be an
advantage because the turnaround time is short and family has higher
propensity to spend because different members order larger variety of
dishes.
Each of these restaurants delivers quality, value and services in its own
way through its line of strategies. The emphasis is on the value that the
restaurant is delivering to the customers.
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Wimpy’s
A). AN OVERVIEW
World Wide Operations
Wimpy’s overseas limited has its origin in United Kingdom since 1954.
Wimpy Overseas limited has an outlet almost all over the world. Current
wimpy operation spreads from Jamaica in the West to the Philippines in
the Far East. It has it strongest representation in the Middle East. Its
most Northerly restaurant is in Bodo, Norway within the Arctic Circle.
The furthest South restaurants are in South Africa where there are
currently about 200 wimpy restaurants operating.
Story behind the name ‘Wimpy’
The name “Wimpy” was first heard of in the” POPEYE THE SAILOR MAN
CARTOON”.
Popeye and his girlfriend, Olive, had a friend called Wimpy. Wimpy was a
rounded, hamburger-eating gentleman, whose slow drawn out voice was
based on a famous wit of that period. He was the inspiration for the
Wimpy Empire.
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Even today Mr. Wimpy is a similar shape, he is dressed as a beefeater as
this is the name of the Queens guards who according to tradition,
protect the Crown Jewels.
This way the fact that Wimpy is a very and also the heart of the business,
the HAMBURGER are linked in one person as the trade mark for the
company.
Indian Operations
Wimpy is the oldest of the international chains to enter the Indian scene.
The company in India i.e., Wimpy’s international Ltd., is a hundred
percent subsidiary of Wimpys overseas limited. Wimpys in India is the
master Franchise for South East Asia.
It extends its operations to Katmandu and Sri Lanka. It started its
operations in India in 1989 with the opening of one outlet in Delhi’s
Connought Place area. Today Wimpys has about 15 outlets in the
country with more expansion plans around the corner for more outlets in
the next two to three years.
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B). MARKETING FUNCTIONS
Wimpys opened its first restaurant in Delhi in 1989. Its been almost nine
years since it was established, Wimpys is primarily recognised as the
burger Chain.
Initially while Wimpys entered the Indian market it hardly had any
competition, except from the local restaurants or from local fast food
joint Nirulas.
In order to beat against competition the company has to decide upon its
target audience. Since its inception the Target Consumer with Wimpys
have been youngsters between the age group of 18-30 and the kids.
Even today Wimpys aims to target the same audience.
Wimpys as a fast food restaurant has been positioned as a very pleasant
resting-place where a wide variety of items are available through fast
service. It is basically selling ambience and atmosphere.
Wimpys marketing strategy lies in Fast Food. Based on this the details of
its marketing mix i.e., product, price promotion and Distribution are
explained below:
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Product Based Strategies
Wimpys is offering in the market and to its customer’s fast food in the
form of burgers, pizzas, salads, beverages, milkshakes, ice creams and
assorted treats.
Any product has three levels
Core product: here a consumer buys a burger or a pizza to satisfy its
taste buds.
Actual Product: The burger that he buys that is neatly packed with
Wimpys mentioned on the cover is the actual product.
Augmented product: Ambience, past service atmosphere, cleanliness all
augment the product.
Wimpys has about 5 to 6 different product lines namely:
 Burgers
 Pizzas
 Salads
 Milkshakes/Beverages
 Ice Creams
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 Assorted Treats.
Following are the range of items at the Wimpys restaurant:
Burgers Pizzas Ice Creams Additional
(in Variety) (in variety) (in variety)
14 8 17 3
Available in two Includes Nuggets and
sizes fries
Its unique selling proposition lies in its product line. Aim is to offer
increasing choice and variety of items to its consumers.
However, when Wimpys had started its operations it had about 3 to 4
product Lines. Since the past five years its product line has remained
same till date. Ofcourse changes are constantly being made to offer new
variety in each of its product lines.
For example: Consider Burgers, when its started it had about six variety
of burgers to offer. Over a period of time it has included new varieties
almost every year. This year it has included chicken liliput burger and
veggie Lilliput burger that is especially for the kids.
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Under its assorted treat line, which includes French fries, fish N chips,
Nuggets etc. has also been modified from time to time. Since the past
two to three years it has started including new varieties to it almost
every year. The most recent additions have been veggie nuggets and
chicken drumsticks.
Wimpys also provides with economical meals, which include a coke,
burger, french fries or any combination of these three. It keeps on
coming with new meals every six months. The most recent meals that it
had in its menu were the Navratra meals, which had a combination of
pizza and coke; vegburger, Frenchfries and coke; and salad, Frenchfries
and coke.
Before the Navratra meals it had come up with Liliput Meals (especially
for the kids) i.e., Veggie Lilliput burger meal, Chicken Lilliput burger meal
etc. (Wimpys has always kept the kids into consideration for deciding its
product lines).
Although the restaurant did have pizzas in its menu earlier i.e., about a
year back but since the past 8 months the restaurant has come up with a
new variety and quality of pizzas. The product line of pizzas that it had in
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its menu earlier was not showing good results i.e., there were not much
of sale of pizzas in the restaurant. But since the modified version has
been introduced, sales have definitely gone up.
Wimpy even has this special Breakfast Meal only at its restaurant in
Connaught Place. The meal is quite different from its rest of the meals. It
has Eggs in a Bun, Doughnuts, Orange juice, Tea/Coffee. It is targeted to
the tourists, executives and the Shoppers in C.P.
The customer now has more variety available to him and he has a wide
range of items available to choose from. All this has been done by
Wimpys to change its image, keeping the competition in mind.
Pricing Strategies
All the items at Wimpys have been competitively priced.The price of
pizzas is far lower than other outlets, such as Dominos, Pizza Hut etc. Its
cheese pizza (regular) is priced at Rs. 45 compared to Pizza hut’s regular
cheese pizza for Rs. 65. Even the Burgers are reasonably priced. Min.
availability is at Rs. 14 for Veggie Lilliput burger and maximum at Rs. 48
for Grilled Chicken burger.
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Even for Pizzas min price is about Rs. 45 for a regular cheese pizza and
max at Rs. 75 for Half non-veg Half veg. This price is quite reasonable
considering the prices of regular pizzas at Dominos where they go as high
as Rs. 150-200 for a regular pizza.
The prices are so designed to suit everyone’s pocket, such that an
average middle class person can afford a meal at Wimpy’s.
Promotion Strategies
Since its inception is 1989 Wimpys has promoted its restaurant mainly
via instore posters and danglers or through outstore posters. However its
promotional strategies have under gone a change in these nine years
considering the competition coming from everywhere.Its promotional
strategy has been to emphasize and publicize the concept of variety,
reach out to people and convince them to eat at Wimpy’s. In brief, the
aim is to reach the right target and do it effectively.The media most
commonly used by Wimpy’s can be classified as:
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Instore Out store
Use of posters and Danglers. Use of Flyer’s, which are gradually
Informing about latest meal combos coming down. Emphasis now is on
and latest additions in the menu. newspapers and press ads. Recently
there is this Wimpy’s Graffiti Show
that is being aired on Times FM. Use
of T.V under consideration.
Coca-Cola also assists in promoting and marketing of Wimpy’s
restaurants.The posters and dangers used for advertising are designed
via free lancers.Wimpy’s provides sales promotion schemes through the
economical meals that its offers. Recently it has started giving coupons in
great savers magazine of September issue, whereby on order of Rs. 200-
299 you get veggie nuggets/Chicken nuggets free. Also, on order of Rs.
300 or above you can have any one of the salads free.During the past
two years, the idea has been to improve the image of the restaurants.
This is being done through improving the menu boards and the
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nameplates. Also the mascot Mr. Wimpy is being promoted more and
more in their posters.
Since the past four to five years. Wimpy’s has always been coming up
with special menus, contests, gift schemes etc., in the festive season such
as Navratras, Diwali and Christmas. It comes up with special menus and
meals during Nawratras, such that people can still come and have meals
during that time.
Aim during the past two years has been to change the image and make
Wimpy’s more and more visible to the people.
Distribution Strategies
Wimpy’s started with just one outlet in Delhi in 1989.In 1993 it had
about 3 outlets in Delhi. By 1998 it has about 10 outlets in total in the
city with one outlet in each of the cities i.e., Jalhandar, Ludhiana and
Bangalore. The opening of its outlet at New Delhi Railway Station in 1997
had a effect on other outlets around that area.
In order to expand its distribution network it has come up with a scheme
whereby an individual can franchise with Wimpy’s. Wimpy’s gives him
the right to use the brand name, but he has to have resources i.e., land
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and capital to become a franchisee with Wimpys. The restaurant
manager and the operation staff would go from the company itself.
CUSTOMER DEMAND
Knowing what factors attract a customer to eating joint is important for
every restaurant. The factors influencing customer demand for Wimpys
menu items are as follows:
 The image of Wimpys as a burger chain and its popularity for its juicy
burgers.
 Wimpys is considered to be the most preferred eating-place especially
by the teenagers and the youngsters. It is them who are mostly the
regular customers almost at every Wimpys restaurant.
 Almost every wimpy restaurant is spacious enough to attract large
crowd of customers. Normally one would not have to wait for long to
get a seating place at its restaurant (except during peak hours).
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NIRULA’S
A). AN OVERVIEW
History and Background
Nirulas today is a well-known name in the hospitality industry.Nirula
family was the first to offer western style fast food in India. It came to
Delhi in 1928. They realized the paucity of good eating places in and
around New Delhi, began ‘Hotel India’ in 1934 with 12 rooms and a
restaurant with a bar license. They also specialized in catering to parties
and soon Nirulas catering became famous.
Meanwhile, Nirula’s had set up the ‘India Coffee Shop’ in Janpath on
request of the Coffee board. A few years later, the Coffee Board of India
seeing the success of the international decided to run the business itself.
It 1939, when the Second World war had started, Nirulas rented more
space in Connaught Circus (what is currently the ground floor of Nirulas,
L-block) and opened a Restaurant with music and dancing serving a six
course dinner for only Rs. 1. The restaurant proved to be popular with
both Indian and foreign guests. It also started serving Indian food and
introduced ballroom dancing and cabaret. However, business fluctuated

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widely since it was dependent on the quality and reputation of those
evening’s performers. Hence, in 1950 the restaurant with the cabaret
was given up in favour of the Brasserie.
The Brasserie was a popular self-service restaurant serving beer and
liquor with a limited menu of Indian and Western food. The Brasserie
gave way to the ‘Cafeteria’; the first of its kind in India with a variety of
Dishes and the guests could help themselves to whatever they
fancied.Before 1947, Nirulas had also opened the first fruit preservation
unit in Delhi. The jams and squash and other preserves were marketed
under the name of Nirula’s and had an all India distribution. With the
partition of India in 1947, the supply of raw material was disrupted and
this unit was stopped.
In 1950, Nirulas started the ‘Chinese Room’ which was the first
restaurant of its kind in India. Nirulas created history by being the first
Indians of non-Chinese origin to have a Chinese food restaurant in India.
In 1954, Nirulas were the first ones to introduce espresso coffee in India.
Gaggia, the inceptors of espresso coffee machines gave Nirula’s sole
distribution rights for their machines and Nirula’s sold these to the luxury
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hotels and first class restaurants. Nirula’s store was opened in the 1950’s
with a section for cold meat and delicatessen products and a separate
section for bakery and confectionery produce.
Nirulas Hotel was started in 1958 and was the first modern 3-star hotel in
India. In 1960 two specialty restaurants were opened. La Bohame was a
modern restaurant where tea, coffee, snacks and meals were very
popular. It was the most popular restaurant of its time in India. Gufa was
an Indian restaurant with Indian style seating and an all silver thali
service in a romantic atmosphere.
The Pastry shop was independently introduced in 1972 and did
externally well. The opening of the Snack bar in 1972 and Hot Shoppe in
1977 again ventured into the quick service food business, which was
instant success. The first Ice Cream Parlor in India was started in 1978.
Potpourri restaurant with the first salad bar in India and the Pegasus Bar
were started in 1979. All of these exist till today.
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The Expansion Plan
It was only by early 80’s that Nirulas decided to expand itself. It’s first
restaurant outside Connaught Place opened at Vasant Vihar in 1980 and
soon followed by Chanakya (1981) and Defense Colony (1986).
In 1985 the Central Kitchen, comprising of the first section bulk kitchen,
Ice Cream section and the bakery section was opened at Okhla, thus
enabling Nirulas to expand faster.
Also in 1985, Nirulas opened their first restaurant outside India in
Katmandu, Nepal. Production facilities were also set up. This was
followed by another in Katmandu in 1986 and one in Pokhra, June 1993.
Mean while Nirula’s also took over the management of restaurants at
Tej’s (Nov. 1985) Karol Bagh (March 1986), New Friends Colony (April
1988), Bungalow Road (Oct. 1990), East of Kailash (Aug 1994) Gurgaon
(Jan 1998) and Faridabad (Feb 1998).
Nirulas’ also set up a unit in Noida, a suburb of Delhi. This unit started
with a restaurant in Jan. 1987 and was soon extended to also include a
Hotel (March 1991) the first of its kind in India offering the most modern
and attractive facilities at very reasonable prices.
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It also started catering services for the Railways in July 1993 by providing
food on the August Kranti Express from Delhi to Bombay.
In 1994, a Food Delivery Service was started at L-block, Chanakya and
Defence Colony and was soon extended to all the units. Nirula’s was the
first to introduce in the country services on such a large scale.
In Jan. 1996, a restaurant complex with a large family style restaurant,
Pastry Shop and a Potpourri restaurant was commissioned in Preet Vihar.
An "“express” Restaurant where the thrust is on take away and delivery
service was opened for the first time at Vasant Kunj in March 1996.
Another outlet at Bawa Potterries Complex at Vasant Kunj opened in Aug
1996. Second express restaurant was opened at Rajindra Place in 1997.
Two restaurants were opened in Haryana in quick succession – in
Gurgaon in 1998 and Faridabad 1998.
A new restaurant at Vikaspuri is being completed and will open soon.
Negotiations are in progress for opening more Hotels and restaurants in
and around Delhi and in major metro cities in Northern India. The
company even plans on opening its outlets in Singapore and in South
East Asia.Besides opening new outlets to cater to the ever-expanding
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market, Nirulas have always believed in expansion and improvement of
its existing facilities.
It has always welcomed other restaurants stating as they assist in
developing the overall business. Even though a number of new
restaurants have started Nirulas’ is still the most popular chain of
restaurants with among the highest sales per square foot. They continue
to experiment, introduce new items and continue to give the citizens of
Delhi and tourists what they desire-excellent quality food at a reasonable
economical price in pleasant surroundings and such a variety that every
one in the family feels catered to – ‘Fun Foods for the Whole family’.
Nirulas stands for Quality, Service Cleanliness and value for money.
In early 80’s when Nirulas started expanding its operations, it positioned
as a family style restaurant for the kids and the entire family.
To target the family, the chain has simultaneously focused on the Child
who will get the rest in. People between the age group of 8-80 have
been the target audience. It is ideally for the kids and the elders.
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Nirulas marketing strategy rests in the adaptation of the fast food
concept to the Indian situation.Nirulas in order to provide products at
best quality has a single central kitchen that caters to all its outlets in
Delhi.Keeping marketing strategy in mind details of the marketing mix
are explained below:
Product Based Strategies
The menu at every Nirulas restaurant is designed keeping in view the
tastes that appeal to the average urban resident. The product line, which
every Nirulas restaurant has, whether inside or outside Delhi can be
categorized into. :
 Burgers
 Pizzas
 Foot longs
 Ice Creams
 Beverages / Shakes
 Hot Numbers.
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At some of its restaurants keeping in mind the local tastes it extends its
product line to:
 South Indian
 Tandoori N Curries.
Following are the range of items available at any Nirulas restaurant:
Burgers Pizzas (in Ice Creams Additional
(in variety) variety) (in variety) (in variety)
15 12 21 5
Served as meal Available in Includes
combos too three sizes tandoori items,
with fries and footlongs, hot
coke nos. etc.
Nirulas has always designed the products keeping local tastes in mind. It
keeps on adding new varieties to its product line every now and then.
The emphasis here is more on indianised food and considering Indian
tastes and consumer into account the products are designed and
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modified.
Nirulas expanded its menu including Tandoori items, South Indian food
etc., during early 90’s and this definitely helped the restaurant in
increasing its clientage.Nirulas keeps on coming up with desi-style
burgers, the most recent addition in the burger category have been the
channa Buger, Bhaji Burger and omelette burger.
Prior to these Nirulas had added the Panner Tikka Burger and Chicken
Tikka Burger to its menu. The rest of the variety has remained more or
less the same over the past many years.
Due to the inclusion of the above few items in the list, Nirulas has re-
invented itself. Vegetarian customers are being offered with separate
exclusive items and non-vegetarian ones are offered similar exclusive
items.
Nirulas has constantly changed the menu as and when consumer
preferences have changed. It is the only serious restaurant chain offering
a complete meal with wide variety.
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Pricing Strategies
Inspire of Nirulas having a monopoly situation for decades with its brand
of restauranting, it has always been cautious about the way in which it
has increased prices.
Its strategy is to rely on high volumes and low margins
.Nirulas has never relied on competition to price its products. The items
on the menu are such, that they can suit every pocket. All kind of people
from all strata visits the restaurant.It has a burger, which is max for Rs.
71 and min at Rs. 16. Its Pizzas range from Rs. 63 to Rs. 96 for a regular
size. These prices are for lower than the pizza chains that have entered
the country.
Promotional Strategies
The ad line for Nirulas goes something like:
“Fun foods for the entire family”.
This serves the purpose of positioning the restaurant as a family, eating-
place. Promotional material used by the restaurant mostly includes
distribution of flyers, menu cards, and through newspapers.
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It has its own in house design department and creative department,
which designs posters and banners for advertising. It is more of in –
house promotions.
Newspaper releases that come out every now and then of Nirulas are
handled by its public relations firm.
Children have always been the prime target group with Nirulas since they
play a key role in deciding where the family should eat. There is constant
promotional activity carried on for the kids by the restaurant.
There is a birthday club membership for children below 13 years of age,
who receive a birthday card and a free scoop of ice cream to celebrate
the occasion.
During April, to coincide with the annual exams, there is Nirulas Scholar’s
award. School children scoring more than 90 per cent troop in with their
report card to claim a Triple Sunday free. Nirulas scholars are sent best of
luck cards in March.
In 1991 when this scheme was introduced there were only 600 entrees.
The members grew to 3000 in 1993 to 15,000 in 1994. By 1998 the figure
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has increased to 90,000. Over 90,000 kids come do Nirulas for a free
sundae.
Nirulas also organizes for birthday parties for the kids at some of its
restaurants.Any festival that comes, Nirulas is associated with it. During
Christmas time Santa Clans appears in all its outlets to hand out sweets
to children.During Diwali it comes up with special gift packs etc.
Today Nirulas has about 25 outlets in Delhi and 3 in Nepal out of the 18
outlets in Delhi 2 of the outlets are express restaurants where the thrust
is on take away and delivery service.
Nirulas carefully uses its locations and also the meal timings to aim at
different target groups. Each of its outlets has its own personality. For
example: Connaught Place has a major share of tourists or foreigners
where as Chanakya Puri and Defense Colony get a lot of young students.
It has carefully chosen the locations of its outlets at Vasant Kunj Leisure
Bowl and Destination Point Faridabad. Such places attract lots of crowd
on holidays and even on weekdays.This is a very effective distribution
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strategy placing yourself where opportunity exists to attract people into
the restaurants.
Setting up of restaurants at such places is a way to ward off competition.
Aim is to move into residential location and making its outlets more
accessible for its clients.
Nirulas started its home delivery services in an organized manner in
1994. Looking at competition coming from the MNC’s who established
themselves as home delivery chains, Nirulas did not want to left behind.
Another reason for starting home delivery services was the rise of the
customer base.
1984 – Only 22000 customers came in a day
1989 – 35,000 Customers per day
1994 – 44,000 Customers per day
1996 – 46,000 Customers per day.
By 2004, 17 Nirulas outlets had home delivery services. The company
witnessed a ten-fold increase in home delivery revenues since it started.
Today, the number of outlets has gone up to 25, which are having
delivery services.
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CUSTOMER DEMAND
The factors influencing customer demand for Nirula’s menu items are as
follows:
 Adapting the western style fast food to Indinised tastes and standards.
 Long term brand-image built by the restaurant over the past 50 years.
 Nirula’s as a restaurant has it’s own image and distinction vis-a-vis
other restaurants in the market. At Nirulas the customer can choose
from Indian tandoori items to western style burgers and pizzas.
 Nirulas restaurant has been placed at the most looked upon places.
One can find a Nirulas joint at the most popular markets, cinema
complexes and bowling alleys.
 The restaurant has been placed as a family style restaurant in the
market. Considering this the inside of the restaurant is such that there
is enough place for families to come and enjoy their meal.
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McDONALD’S
A). AN OVERVIEW
History and Background
In 1955, Ray Kroc, a 52-year old salesman of milkshake mixing machines,
became interested in a string of seven restaurants owned by Richard and
Maurice McDonald. These two founded the quick service restaurant
industry when they converted their barbecue drive in with carhops into
the world’s first McDonand’s limited menu, self-service drive-in in 1958,
in California. Kroc liked their fast-food restaurant concept and bought
the Chain for $2.7 million.
He opened his first McDonalds in Illinois in April 1955 and founded the
company that evolved into McDonalds corporation. He decided to
expand the chain by selling Franchises, and the number of restaurants
grew rapidly.
SaurabhGupta 32
Worldwide Operations
There are more than 23,000 McDonalds restaurants in III Countries (as of
Jan. 1998). McDonalds 1997-year end system wide sales were $ 33,368.3
billion.
McDonalds is the largest and the best known global food service retailer.
Its global market potential is enormous seeing the member of
restaurants it has. On any day McDonald’s serves less than one percent
of the worlds population. Its outstanding brand recognition. (It is one of
the most recognised brand all over the world), experienced
management, high quality food, site development, high quality food, site
development expertise, advanced operational systems and unique global
infrastructure position it to capitalize on global opportunities.
McDonalds Vision is to dominate the global food service industry. Global
dominance means setting the performance standard for customer
satisfaction and increasing market share and profitability through
successfully implementing convenience value and exception strategies.
In order to expand its operation McDonalds goes by a simple thumbrule
to estimate haw many outlets it wants: One restaurant for every 25,000
SaurabhGupta 33
people with new markets sprouting in so many parts of the would, the
chain is expanding at a breathtaking pace of one restaurant every three
hours. This can be known from the following:
Period No. of outlets Countries Sales
Jan. 1997 19,400 95 $ 30 billion
Jan 2005 33,000 119 $ 44 billion
McDonalds franchises restaurants in many international markets, and
decisions relating to the selection of candidates are made local by the
management in the country where the restaurant is located.
McDONALD’s India
A locally owned Company
McDonalds India is a locally owned company managed by Indians. In
Mumbai Amit Jatias company, Hard castle restaurants Pvt. Ltd., owns
and manages McDonalds restaurants. In Delhi, McDonalds restaurants
are owned and managed by Vikram Bakshis Connaught Plaza restaurants
Pvt. Ltd. Both these individuals are responsible for the running of
McDonalds India.
Local Sourcing is Key for Truly Indian Products
SaurabhGupta 34
Around the world, McDonald’s traditionally operates with local partners
or local management. In India too, McDonand’s purchases from local
suppliers. McDonald’s constructs its restaurants using local architects,
contractors, labour and - where possible - local materials. McDonald’s
hires local personnel for all positions within the restaurants and
contributes a portion of its success to communities in the form of
municipal taxes and reinvestment. Its 98% of the inputs are obtained
domestically.
McDonald’s sources food products from local companies. mutton patties
are supplied by Al-Kabeer, Hyderabad, Andhra Pradesh; fresh lettuce
comes from Pune, Ooty, Maharashtra and Dehradun; cheese from
Dynamix Dairies, Baramati, Maharashtra; sesame seed buns and sauces
from Cremica Industries Phillaur, Punjab, and pickles from VST Natural
Foods, Hyderabad, Andhra Pradesh.
Setting Up of an Extensive Food Chain
For three years before the opening of the first McDonald’s restaurant in
India, McDonald’s and its international supplier partners worked
SaurabhGupta 35
together with local Indian companies to develop products that meet
McDonald’s vigorous quality standards. These standards also strictly
adhere to Indian Government regulation on food, health and hygiene.
Part of this development involves the transfer of state-of-the-art food
processing technology which has enabled Indian business to grow by
improving their ability to compete in today’s international markets.
For instance, Cremica Industries worked with another McDonald’s
supplier from Europe to develop technology and expertise which allowed
Cremica to expand it business from baking to also providing breading and
batters to McDonand’s Indian and other companies. Another benefit is
expertise in the areas of agriculture that allowed McDonald’s and its
suppliers to work with farmers in Ooty, Pune and Dehradun and other
regions to cultivate high quality lettuce. This includes sharing advanced
agricultural technology and expertise like utilization of drip irrigation
systems which reduce overall water consumption and agricultural
management practices which result in greater yields.
In some cases, these Indian suppliers had the technology - but no market
for the products they produced. For example, Dynamix Dairies -- through
its relationship with McDonald’s was introduced to a large customer of

SaurabhGupta 36
milk casein and other milk derivatives. The two companies entered into a
business relationship resulting in an initial export order of approximately
US $ 12 million per year - with the potential to increase. McDonald’s
local supply networks through Radhakrishna Foodland, to get products
from the various suppliers to restaurants in Delhi and Mumbai.
Respect for the Indian Customer and Culture
McDonald’s worldwide is well known for the high degree of respect to
the local culture. McDonald’s has developed a menu especially for India
with vegetarian selections to suit Indian tastes and culture. Keeping in
line with this McDonald’s does not offer any beef or pork items in India.
McDonald’s has also re-engineered its operations to address the special
requirements of a vegetarian menu. Vegetable products are prepared
separately, using dedicated equipment and utensils. This separation of
vegetarian and non-vegetarian food products is maintained throughout
the various stages of procurement, cooking and serving.
An Employer of Opportunity
McDonald’s India is an employer of opportunity, providing quality
employment and long-term careers to the Indian people. the average
SaurabhGupta 37
McDonald’s restaurant employs more than 100 people in 25 different
positions - from cashier to restaurant manager. McDonald’s world-class
training inputs to its employee could be seen in the present close to
10000 employees currently in Mumbai and Delhi.
Community Partnership
McDonald’s believes in giving back to the communities it serves.
Wherever McDonald’s goes it becomes a part of the community it
operates in and contributes towards the development of the locality. For
example, McDonald’s has introduced the concept of ‘Litter Patrol’ -
McDondld’s employees go around the immediate vicinity of the
restaurant every day, packing up garbage left behind not only by
customers from McDonald’s restaurants but also by other visitors to the
area. The result is a cleaner neighborhood.
To commemorate 50 years of Indian independence, on 15 August 1997,
McDonald’s Mumbai organized a ‘No Garbage Drive’, in association with
the ‘Brihan Mumbai Municipal Corporation’ and five schools in Bandra.
Inaugurated by the Municipal Commissioner, this was in support of BMCs
‘Zero Garbage, initiative. Other community activities undertaken by
SaurabhGupta 38
McDonald’s in India include the adoption of local public parks for
restoration and beautification, thereby providing a play area for children.
In fact in Delhi, McDonald’s has even addressed the security issues
relevant to a particular residential colony.
Charities, especially those benefiting children, are often the recipients of
McDonald’s support - either through the use of the restaurants for
meetings or for fund-raising activities. McDonald’s International
charitable foundation, Ronald McDonald House Charities supports
charities around the world. In fact, in 1993, RMHC donated to the Indian
Prime Minister’s Relief Fund following the devastating earthquake in
Maharashtra.
Quality, Service, Cleanliness and Value
The McDonald’s philosophy of QSC & V is the guiding force behind its
service to the customers.
McDonald’s India serves only the highest quality products. All
McDonald’s suppliers adhere to Indian government regulations on food,
health and hygiene while continuously maintaining McDonald’s own
recognized standards. All McDonald’s products are prepared using the
SaurabhGupta 39
most current state-of-the-art cooking equipment to ensure quality and
safety.
At McDonald’s the customer always comes first. McDonald’s India
provides fast, friendly service - the hallmark of McDonald’s that sets its
restaurants apart from others.
McDonald’s restaurants provide a clean, comfortable environment
especially suited for families. This is achieved through McDonald’s
stringent cleaning standards, carefully adhered to.
McDonald’s menu is priced at a value that the largest segment of Indian
consumers can afford. McDonald’s does not sacrifice quality for price -
rather McDonald’s leverages economies of scale to minimize costs while
maximizing value to customers.
McDonalds has a 20-year profitability plan for India and it intends having
at least 50 restaurants here by the year 2000. The company has already
invested Rs. 50 crore in its Indian operations, and each of the two joint
venture partners has invested about Rs. 17.56 crore.
Mc Donalds started its operations in India in October 1996 and by July

SaurabhGupta 40
1998 it has served about 10 million customers in the country.
Mc Donalds marketing philosophy is captured in its motto of “Q.S.C.V.”,
which is the guiding force behind its service to the customers.
Mc Donalds India serves only the highest QUALITY products. All Mc
Donalds suppliers adhere to Indian government regulations on food,
health and hygiene while maintaining Mc Donalds own recognised
standards. All its products are prepared using the most current, state of
the art cooking equipment to ensure quality and safety.
At Mc Donalds, the customers always come first. Mc Donalds India
provides fast friendly SERVICE – the hallmark of Mc Donalds that sets its
restaurants apart from others.
Its restaurants provide a CLEAN, comfortable environment especially
suited for families. This is achieved through Mc Donalds stringent
cleaning standards, carefully adhered to.
Mc Donalds menu is priced at a VALUE that the largest segment of Indian
customers can afford.
SaurabhGupta 41
It’s strategy in India is to target the plain and simple mass market. The
target consumers for Mc Donalds are the family and the kids. Mc
Donalds has been positioned as a “Family Restaurant”.
Product Related Strategies
World over Mc Donalds is known for its juicy beef burgers. But in order
to settle in India the entire concept of beef burgers had to be changed.
India is the only country where Mc Donalds is offering veggie burgers and
non-veg burgers without beef (uses mutton instead).
This is a classic case of Product Adaptation, where Mc Donalds adapted
its product according to the culture and norms of the country in order to
position itself in the market.
There has been other product adaptations too. Mc Donalds sells a spicier
Maharaja Mac in India as its flagship product in place of the globally
famed Big Mac. It also has a large capacity for vegetarian burgers, the
production and serving of which is separated in such a way that the
customer can actually see it.
Mc Donalds product line is almost similar to other burger chains in the
country.
SaurabhGupta 42
 Burgers
 Desserts
 Beverages/shakes
 Assorted items.
Burgers Pizzas Ice Creams Additional Meal
(in variety) (in variety) (in variety) (in variety) Combos
12 - 2 2 (french fries 7
and veg nuggets)
Product standards, packaging, quality, processing are all the same like at
any other Mc Donalds outlet in the world. The quality standards are so
stringent that nowhere, not even is its rawest state, is any of the food
touched by hand. The typical burger undergoes 54 checks before it is
served. The menu at Mc Donalds has remained more or less the same
over the past 2 years except a couple of additions in the burgers variety
and inclusion of couple of items in the dessert variety.
SaurabhGupta 43
Mc Donalds even has the calorie count carefully worked out for its
burgers. A veg burger offers 418 calorie, 10 gm of protein, 22gm of fat
and 48 gm of carbohydrate.
All Mc Donald’s menu items fit into a balanced diet and it offers certain
items that fit well within a low fat diet (option of burger with or without
cheese).
Pricing Strategies
Worldwide Mc Donalds is known for its ‘Purchasing power’ pricing. The
ability to pay-of a large section of customers has been the sole criteria.
This was assessed through market research. It wanted to price its
products in such a way that it can even be accessible to a child. For this it
examined Indian spending on snacks and other foods before setting on
the prices.
Price variations from 1996 to 1998 for a couple of items are as follows:
Item Entry level (1996) (2005)
Mc Burger Rs. 12 Rs. 20
Maharaja Mac Rs. 42 Rs. 59
SaurabhGupta 44
The company continued with the 1996 prices for about a year in order to
meet its one million-target audience.
One look at the restaurant and it doesn’t seem that the prices of its
products would be this low. Reason being that Mc Donalds gets the
materials (55 per cent of outlets running expenses) at very cheap rates.
Therefore this is one of the reason that Mc Donalds products are priced
reasonably. It buys its supplier from 35 suppliers who sell at incredibly
low prices. Products at Mc Donalds are neither elitist in its pricing nor at
the dhaba level, they are average in its pricing.
Mc Donalds was offering a softie at a price of Rs 6/- about a year back
during the festive season. Today this softie costs only a rupee more at
Rs.7/-. No restaurant of this caliber offers a product at this rate.
Mc Donalds recently has come up with “Economeals”, in which one can
afford to have a burger and coke for as little as Rs. 29/- and at max for Rs.
49/- (Instore pamphlet enclosed) Mc Donalds keeps on coming up with
such meals almost every month such that almost anyone can afford to
have a Mc Donalds product.
Promotional Strategies
SaurabhGupta 45
Mc Donalds ad line goes like:
“I am loving it”
Mc Donalds had started its promotional activity with local area banners
and posters and now it has moved on to movie hall commercial. Its
commercial is a 60-second close up which focuses on a burger being
prepared in slow motion tantalizing the audience as though it’s a strip
tease.It has even started advertising through local channels such as siti
cable.
Mudra is the ad agency, which puts up publicity banners in Delhi and
Mumbai and takes up the local TV commercials. Newspapers such as
Delhi times are also being used for local advertising. McDonald’s plans to
advertise in national newspapers such as Hindustan Times and Times of
India in another couple of months.
In addition to this Mc Donalds also has a public relation agency handling
its account that takes care of publicity and press releases.
McDonalds keeps on coming up with sales promotion schemes every
now and then.
SaurabhGupta 46
During World Cup Soccer it came up with this soccer game for Rs.11/-
with every meal combo ordered. Since kids are the prime targets by the
restaurant, it has come up with happy meals especially for the kids along
which a game is free.
Also, for the kids Mc Donalds is the most happening place for birthday
parties kids love the place due to all the attention and knick-knacks they
are showered with. The restaurant even has playpens displayed
especially for the kids.
McDonalds also comes up with special schemes during the festive season
Last month i.e. September, during Navratras it came up with special
“Shudh Shakahari Meal” where a meal for two was for Rs. 99/- and a
meal for four was for Rs. 199/- (Instore pamphlet enclosed). Another way
through which Mc Donalds is promoting its image is via community
services. There are Mc Sermons on maintaining parks, conducting litter
patrols and putting up public trashcans.
At majority of McDonald’s restaurants, the management emphasizes on
developing parks for the kids as a playground for them. E.g. at
McDonald’s G.K. restaurant there is a playground developed for the kids
SaurabhGupta 47
in front of the restaurant. The management has put boards at these
parks to put across certain messages for the community as a whole, such
as:
“If you see someone without a smile, give them one of yours”
“Children are the light of our future” etc.
In addition to all these promotional measures, McDonalds has boards
put all over the roads to show directions to their restaurant. These
boards are put almost two to three kms before the location of the
restaurant. This makes it easier for the customer who is not familiar with
McDonald’s restaurant location.
Till date Mc Donalds has 187 outlets in India out of which 56 are in Delhi
and five in Mumbai. In 1997 there were about 3 outlets in Delhi and fifty
three more outlets have been added to the list by 1998.
By the year 2000 Mc Donalds plans to have about 50 outlets in the
country. At Mc Donalds, while opening a restaurant the emphasis is, to
choose a site whereby 150-200 seating capacity can be available. This is
to attract as many people as possible into its premises.

SaurabhGupta 48
CUSTOMER DEMAND
The factors influencing customer demand for McDonald’s menu items
are as follows:
 McDonald’s worldwide is known for its quality burgers. This worldwide
name for burgers has influenced the demand for it in the Indian
market. This can be known from the fact that within two years it has
served about 10 million customers at its restaurants.
 The factor that influences customer demand for the organizations
product to a great extent is the offering of highest quality product,
providing services which is fast friendly and accurate, creating a
restaurant atmosphere which is always clean, comfortable and ideally
suited to India families and children.
 McDonald’s products are offered at a value that can be affordable by
the maximum number of Indian consumers.
 The Chain of restaurants provide a variety of comfortable seating
arrangement to accommodate different size groups of people from
individuals to large families.

SaurabhGupta 49
McDONALD’S Customer Base
 In 1997, Mc Donalds 3 outlets received about 15,000 customers daily.
 A Mc Donalds restaurant with about 150-200 seating capacity serves
about 40,000 customers per month.
 By July 1998, Mc Donalds has served 10 million customers in the
country.
SaurabhGupta 50
MARKET RESEARCH
 To identify and analyze the marketing strategies of the three fast food
chains:
- McDonalds
- Wimpys
- Nirulas
Under the fast food market.
 Analyzing the performance of the above chains since the past five
years.
 Making a comparative analysis of the above three restaurants.
 Conducting market research study to determine :
- Percentage wise consumer preferences
- Frequency of visit at each of the stated restaurants
- Identifying unique factors that attract people to the stated
restaurants.
SaurabhGupta 51
METHODOLOGY
 Information regarding the organisation, 4P’s of marketing, and
consumer preferences has been obtained through :
a. Primary Sources
b. Secondary Sources.
Primary Sources
i. Marketing personal, PR personnel of the concerned organisation
were approached to obtain in formation about the concerned
subject (Sample questionnaire on the next page). McDonalds
marketing and other details had to be obtained indirectly through
its public relations firm since direct accessibility to the corporate
office was not possible.
ii. Market research study was conducted in order to find out
percentage wise preferences of the stated fast food restaurants.
Secondary Sources
i. Internet
ii. Articles from A & M and economic times
SaurabhGupta 52
iii. Company brochures, literature and pamphlets.
 Based on the information obtained from the above sources concepts
were developed on which analysis could be made.
 Conclusions and recommendations have been thereby given after a
thorough evaluation of the marketing strategies of the three
restaurants.
Research Objective
The objective of conducting a market research study is to:
(i) Identify the unique factors that attract people to each of the three
stated restaurants.
(ii) Determine the percentage wise preference for these for these
restaurants.
(iii) Finding out the frequency of visit at each of the stated restaurants.
Methodology
(i) A set of attributes was generated on basis of which objective
could be determined. This would eventually determine what
attributes/benefits the consumer desires.
SaurabhGupta 53
- Price
- Accessibility
- Quality of food
- Variety
- Speed of Delivery
- Space
- Cleanliness/hygiene
- Decor
(ii) Based on above attributes concepts were developed on which
analysis could be made.
(iii) Finally a personally administered questionnaire survey was
conducted (Based on which findings have been presented).
Reasons for selecting the various questions
(i) Question 1 & 2
To determine the frequency of visit to all three fast food restaurants and
determine the income generated approximately on basis of the
expenditure incurred.
SaurabhGupta 54
(ii) Question 3
Various factors being considered by respondents to select a restaurant.
(iii) Question 4
Evaluation of most preferred fast food restaurant on various criteria.
Data Preparations
A total of 20 questionnaires used to conduct the survey. In accordance
with the response drawn from the questionnaire tables and graph have
been prepared
Determination of Percentage wise Preference
Percentage wise preference for the three stated fast food restaurants as
indicated by market research study is :
Restaurants Consumer Preferences (in %)
Nirulas 26
Mc Donalds 65
Wimpys 09
SaurabhGupta 55
BARGRAPH INDICATING FREQUENCY OF VISIT
The above pie diagram shows that 26 per cent of consumers would
prefer going to Nirulas restaurant,65 per cent prefer for Mcdonalds and
only 9 per cent prefer a Winpy’s joint.
The unique attributes which attract consumer to Nirulas that makes it
stand out from the rest is variety, accessibility and value for money.
McDonald’s and Wimpys (both foreign entrants) have a very little
difference in their preferences by the consumer.
Preference for Nirulas over and above the other two states that over the
past many decades Nirulas has maintained its brand recognition till date
SaurabhGupta 56
and it is very much likely to continue in the future, since Nirulas being an
Indian company knows the customer tastes and preferences better than
the foreign entrants.
BARGRAPH INDICATING FREQUENCY OF VISIT
14 Nirulas McDonald's Wimpy
12
10 10
10
8
8 7
6 5 5
4
4 3
2
2 1 1 1 1 1
0
0
Do not visit Occasionally Monthly Weekly More than once a
week
SaurabhGupta 57
Identifying Unique Attributes
The unique attributes of the three fast food joints are:
Nirulas: Variety, Accessibility, value for money.
Wimpys: Spacious, Quality of food
Mc Donalds: Spacious, Service, hygiene, value for money.
Criteria most commonly considered by respondents while selecting a
fast food joint.
Criteria Ranking (from 1 to 5)
Quality of food - 1
Cleanliness /hygiene - 2
Variety - 3
Speed of Delivery - 4
Price - 5
(Computations in Appendix III)
SaurabhGupta 58
COMPARITIVE ANALYSIS
A comparative analysis for the three food chains has been made on the
following five parameters:
 Performance
 Variety
 Price
 Accessibility
 Service
Performance
Nirulas started its operations in the country as early as in 1930’s but its
first fast food restaurant came up around in 1950’s. This means that the
chain is about five decades old. Wimpys is about 8-9 years old and Mc
Donalds just two years old.
Each of these chains has its own reputation and name in the market.
Nirulas being in the country for so long still has it’s distinguished fan
following and is surviving in the market despite the coming in of the
international chains such as Mc Donalds and Wimpys. Nirulas is
SaurabhGupta 59
considered to be more of a dine–in eating-place than a fast food joint
like the other two. Most of the time the customers coming in at Nirulas
are not in a hurry to leave, they want to relax and enjoy their meals. In
contrast Mc Donalds and Wimpys are considered to be a place to grab a
bite or quick take away fast food joint. McDonald’s in US is a lunch time
place from which customers keep away in the evening. Nirulas on the
other hand is packed after dusk with carloads of families to have dinner.
Despite Mc Donalds being placed as a comfortable family-eating
restaurant, a person would come to the restaurant to have a quick meal
for lunch or dinner alone or with his family.
When Wimpys came into the country in 1990, with two outlets in Delhi,
Nirulas had about 11 outlets all performing well, serving a wide variety of
items from thaalis to hotdogs to pizzas. But Wimpys was not performing
well except in a couple of locations such as C.P and G.K in Delhi. The
worst came for Wimpys when Mc Donalds had itself in locations where
there was already a Wimpys outlet. Market became sluggish for Wimpys
after the entry of Mc Donalds. Preference for the Mc Donalds burger
increased vis-à-vis the Wimpy burger for quite some time (about a year).
People started liking its service, quality of food, ambience etc.

SaurabhGupta 60
However, in the past six to eight months Wimpys has tried to review its
position by offering a variety in the menu i.e. inclusion of salads, pizzas
etc, to beat competition.
The trend for kids birthday parties at these restaurants which was
initiated by Wimpys has witnessed quite a set back from the entry of Mc
Donalds. The audience suddenly started preferring Mc Donalds for
birthday parties than Wimpys within a year of its entry. (On an average
Mc Donalds hosts about five to six birthday parties at each week at
majority of its restaurants).
When Mc Donalds came up in locations where Nirulas was already
established, it affected the restaurant drastically in the initial few
months. But as and when the customers had tried the Mc Donalds
product, they returned back, happy that Nirulas offers a wider choice and
tastier food.Hence, Nirulas is still performing well in the market despite
the coming in of Mc Donalds and Wimpys. Wimpys however would need
to re-define its strategy to survive since it is in for a lot of competition
and as far as Mc Donalds is concerned, its worldwide brand recognition is
enough to make it sustain in the market.
SaurabhGupta 61
Variety
The range of items that each of these joints has can be seen in the
following table.
Name Burger Pizzas Ice creams Additional( includes
(in (in (in assorted items)
variety) Variety) variety)
Nirulas 15 12 21 15
Wimpys 14 8 17 8
Mc 12 - 2 2
Donalds
No. of Meal Combos
Nirulas 15
Mc Donalds 7
Wimpys 4
The range of items given in the above table and no. of meal combos are
standard items which the restaurant has. In addition to this Nirulas
comes up pizza of the month and ice cream of the month. Wimpys
SaurabhGupta 62
comes up with new meal combos every two months and Mc Donalds
comes up with a meal combo also almost every month.
For all the product lines Nirulas takes the cake vis-à-vis other two joints.
The customer has a range of items to choose from at Nirulas. He is just
not restricted to a few items in the menu list. One has every thing from
Indian to Western food at most of its joints, Wimpy’s too has a variety of
items in the list, but nowhere near to what Nirulas is offering. Though
McDonald’s has the least variety of items in its menu, it is surviving in the
market because of its world wide brand recognition. The fact that
McDonald’s burger is famous all over the world, is what that is making it
sell like hot cakes in India.
However if one wish to just grab a bite one could go to McDonald’s but if
one is looking for variety then Nirulas is the place to go to. From the
market research study conducted to know consumer preferences,
Nirulas is the most preferred eating place and variety is one of the
unique attributes for Nirulas, which attracts customers to its restaurant.
In the burgers category Nirulas has the maximum variety, Wimpys stands
second and Mc Donalds has the least variety. For Pizzas Nirulas has more
SaurabhGupta 63
variety than Wimpys and for ice creams too Nirulas has maximum
variety.
Price
Each of the products at Wimpys, Nirulas and Mc Donalds are priced so as
to suit everyone’s pocket.
When Mc Donalds opened its first restaurant in the country it adopted a
price strategy whereby all its products were priced lower than the
domestic counterparts. It had priced its chicken burger at Rs. 39, a rupee
below Nirulas equivalent in 1996. Today, the burger is priced at Rs. 20
and Nirulas burger is for Rs. 40.
The 2005 prices of each of the three restaurants for their chicken and
veg burger are:
SaurabhGupta 64
Chicken Burger (Rs.) Veg Burger (Rs)
Nirulas 45 40
Mc Donalds 49 20
Wimpys 43 33
The prices of its products are very much competitive with a rupee or two
below or above.
Another interesting feature of these restaurants is the meal combos that
they serve. All the three food joints offer these meal combos with a
combination of burger + pepsi + fries. Basic idea behind this is to offer
meals at a very economical rate.
The meal combo rates of each of the three joints can be depicted from
the following table
Veg Meal Combo Non-veg Meal Combo
(Veg Burger + Coke+ (Chicken Burger + Coke +
Fries) Fries)
SaurabhGupta 65
Nirulas Rs. 57 Rs. 64
McDonald’s Rs. 51 Rs. 55
Wimpy’s Rs. 65 Rs. 75
Again for these meal combinations too the prices are competitive for all
the three restaurants. Nirulas offers these meals at the most economical
rates compared to McDonalds & Wimpy’s.
However, from the market research study conducted price is considered
to be the fifth most important variable while selecting a fast food joint.
The emphasis is more on quality of food, cleanliness, variety and speed
of delivery. Therefore price becomes an in significant characteristic to
the extent that the product is affordable by the consumer.
Accessibility
Every restaurant has to be placed at the right location such that it
attracts the maximum number of customer into its premises. All the
three restaurants in the city are located at the most frequently visited
places by the customer. Nirulas started with its expansion plan by
opening a joint in C.P. (the most frequently visited place in the city). Soon
SaurabhGupta 66
more and more joints followed and all of them are located at either the
most popular markets in the city or cinema complexes or bowling alleys.
This way anybody going for shopping, watching a movie or just playing
some games doesn’t have to go to another part of the city to have meals.
Wimpy;s too opened its to first restaurant in the city at C.P., to be
accessible to the tourists, shoppers and executives in that area.
McDonald’s opened its first restaurant in Vasant Vihar Complex to be
accessible to the movie watcher’s coming there.
How ever, Nirulas has an added advantage in terms of accessibility vis-à-
vis the other two joints due to its home delivery services. Although the
services are restricted to the locality where the restaurant exists, still it
has an advantage because the customer if he does not feel like going to
the restaurant and have a meal he can still consider it if the home
delivery services are made available. Amongst the three restaurants
Nirulas has the maximum no. of outlets in and around Delhi. This is
mainly due to amount of time for which it has been into the business.
However, all the three restaurant are located at the most frequently
visited places by the people such as shopping areas, cinema halls,
bowling alleys etc.

SaurabhGupta 67
Service
McDonald’s takes the share on this attribute for providing the customer
with fast and friendly services.
At Mc Donalds you get your order usually within 60 to 90 seconds from

the time it is placed. Providing the customer with fast and friendly
services is under the philosophy of McDonalds. This is one big advantage
Mc Donalds has over Wimpys and Nirulas. Even at Wimpys you get your
order between two the three min. but this is followed at only few of the
restaurants. It is not a standard rule everywhere, but at Mc Donalds it is
at every restaurant.
On this attribute, Nirulas has a disadvantage. Once an order is placed it

normally takes about 10 to 15 min. to get the order. This is probably
because of the fact that the kind of food served and the production
facilities used by Nirulas differs from the production facilities used by
McDonald’s and Wimpys. Mcdonald’s and Wimpys have an assembly line
approach to fast food where a certain number of orders are already
prepared/cooked, the idea is that as soon as the payment is made at one
counter, the food can be picked from the next almost instantly. On the
other hand at Nirulas the order is dealt with after it has been placed. But
whatever may be the case, provision of fast and friendly services to the
customer is very important for any fast food restaurant. In the market
research study services is the unique factor for McDonald’s that attracts
the customer to its restaurant. The customer prefers being serviced by a
SaurabhGupta 68
friendly countrer assistant than someone who is arrogant and least
interested in entertaining the customer properly.
SaurabhGupta 69
SaurabhGupta 70
SWOT ANALYSIS
SWOT Analysis is an overall evaluation of the previous analysis and
the marketing strategy of the organization in terms of its strengths
and weaknesses of the unit, the opportunities available to it and the
threats posed by the external environment.
The strengths, weaknesses, opportunities and threats faced by each
the three restaurants are presented individually.
McDONALDS
Strengths
 Mc Donalds serves its customers with high quality products. There
are extensive quality tests at the supplier and all products are
examined again in the restaurant to ensure that they are of highest
quality possible.
 Mc Donalds provides fast, friendly service. Any customer visiting Mc
Donalds is usually served within 60 seconds.
 Mc Donalds menu is priced in such a way that the largest segment
of Indian consumers can afford. It has a wide variety of products at
different prices to be affordable to as many as possible.
SaurabhGupta 71
 Mc Donalds is an active participant in community services.
Weaknesses
 Mc Donalds has limited range of items in its menu. However, to get
a item included in the menu approval has to be made from the high
tech kitchens at Mc Donalds headquarters in suburban Chicago.
 In India burgers are a long way from becoming the common man’s
food, having fast food is considered to be another option for dining
out, unlike other countries.
Opportunities
 Mc Donalds can develop two regional training colleges in India, one
each in Delhi and Mumbai. This can save the expense of the
organization is sending its management team and crewmembers to
outside countries like Indonesia and America.
 Mc Donalds expects to expand its chain in the coming years. It plans
to open about 50 restaurants by the year 2000. This can have the
opportunity to serve and employ more people.
SaurabhGupta 72
Threats
 Mc Donalds faces tough competition from other food chains in the
country both international i.e. Kentucky Fried Chicken, Wimpys and
Pizza hut and domestic i.e. Nirulas.
 The decision taken by Mc Donalds India to serve ‘Shudh Shakhari”
meals at its restaurants can risk the global American image of Mc
Donalds.
NIRULAS
Strengths
 The consumer has a wide variety of items to choose from at Nirulas
(Both Indian and Western). These items are constantly modified
keeping the consumer preferences in mind.
 Nirulas brand loyalty has not changed (at least till now) despite the
coming in of the MNC’s.
 Home delivery services started by the restaurant have improved its
customer base. This would prove to be an added advantage in the
long run.
SaurabhGupta 73
Weaknesses
 The restaurant does not have stringent cleanliness/hygiene
standards.
 The restaurant does not provide with fast and friendly service. At
times it takes about 30 min for a meal to be served.
Opportunity
 The home delivery services started by the restaurant can be
expanded further by introducing it even at those joints where is has
not started. This would help the restaurant to expand its customer
base and serve more clients.
 The opening of Nirulas restaurants at places like “destination point”
and “leisure bowl” has tremendous opportunity for serving its
clientele.
Threats
 Nirulas mainly faces competition from international fast food chains
that have established themselves in the country about two to three
years back such as Mc Donalds, Pizza Hut, Dominos, KFC etc.
 The international food chains that are opening their outlets in the
SaurabhGupta 74
country might give attractive offers to its employees. Hence there
could be a problem in keeping its employed workforce.
SaurabhGupta 75
WIMPYS
Strengths
 Wimpys serves its customers with a wide variety of items. The
consumer has a list of items to choose from the menu.
 The crewmembers at the restaurant are friendly and meals are
served in about 5 to 7 minutes from the time of its order. At certain
restaurants meals are even served immediately after the order is
placed.
 The restaurant is a clean and spacious enough to have a
comfortable meal.
Weaknesses
 Does not adhere to strict service standards at all its restaurants in a
similar way. If a meal is provided at one restaurant in 60-90
seconds, it should be provided at the second restaurant in the same
time limit.
Opportunity
 With the coming up of a modified menu and changing the image of
the restaurant during the past months, opportunity does exist for
SaurabhGupta 76
Wimpys to make itself visible to the customers. It plans to go on
these lines for some more time such that its customer base can be
improved.
 Opening of its restaurant at New Delhi Railway Station has
improved its clientele at the nearby restaurants around that area.
Threat
Competition exists for Wimpys both from foreign and Indian food
Chains i.e. Mc Donalds, Pizza hut, Nirulas etc. It is going to face
problems in competing with international burger chains come into the
market and others coming into the market.
SaurabhGupta 77
LIMITATIONS
There are following drawbacks in the findings:
 Sales figures (current and past) could not be made available for any
of the three restaurants.
 Distribution strategies of Mc Donalds not upto the mark.
 Customer base figures not available for Wimpys.
 Organisation structure for McDonald’s could not be made available.
SaurabhGupta 78
CONCLUSIONS AND RECOMMENDATIONS
CONCLUSIONS
Indian food market has witnessed several entrants into the country
over the past few years. Each of the established food chains and the
ones entering the market pose a threat to each other. In the food
market each restaurant faces competition from 1000 other
restaurants, it could be a 5-star restaurant or a roadside dhaba. In
order to prove itself, the restaurant has to have a well-defined
marketing strategy and famous brand recognition to survive in the
market.
The three fast food chains whose marketing strategies have been
compared and analyzed also need to look on their marketing
strategies to do more than just survive in the market (Certain
recommendations have been put forth in the coming pages).
SaurabhGupta 79
The attractiveness of the three restaurant chains in the fast food
market can be judged from the following factors:
 Existing Competition
The Indian food market today has many established global chains that
have opened their restaurants at major cities in the country. It is only
those restaurants who have built their image over many years in the
country i.e., Nirulas and world famous brands such as McDonald’s are
the ones to sustain themselves in the market. Any other restaurant
below this caliber would not have the power to fight these joints.
Nirulas has the power to fight competition because it is not identical
to the MNC chains and has not duplicated their policies. Also as long
as it continues to deliver value to its customers it is unlikely to feel the
heat of competition. McDonald’s however is new to the market but in
a short period of time it has built a place for itself in the market by
reaching the maximum number of audience in almost all income
groups. Wimpy’s however will have problems competing with the
multinational burger chains come into the market.
SaurabhGupta 80
 Substitutes Available
There are end numbers of substitutes available to the customer for
fast food in the market. The customer can choose from traditional
Indian cuisine to specialty cuisine such as Chinese, Italian, Thai etc. For
the three fast food joints there must be more than a thousand
restaurants to choose from as substitutes. Even Wimpy’s burger could
be a substitute for Nirulas Pizza or vice versa. It all depends on the
choice of the customer of what he wants to have.
 Likely New Competition
Looking at the changing lifestyles and the disposable income of the
middle class increasing, the food market has enormous potential.
Wimpy’s definitely will have problems in the future if new
multinational burger chains enter into the market. With this its
market share will fall and it could even become a non-player in the
near future. McDonald’s with its “purchasing power pricing” policy
however has dominated the middle class segment in the market. Until
and unless some chain with the same policy attacks the market,
McDonald’s does not have any threat from new burger chains
SaurabhGupta 81
entering the market. For Nirulas however it is the variety and the
location factor, which can save the chain from new competition.
RECOMMENDATIONS
For the purpose of growth of each of the thee fast food restaurants
i.e., Wimpy’s, Nirula’s and McDonald’s certain recommendation have
been given below:
McDONALD’S
 Variety: Mc Donalds should start considering new additions to its
menu looking at the expansion plan the company has lined up for
India, it cannot do much until and unless it makes new additions to
the menu.
 Being an international chain, there is scope for drive in restaurants
in certain joints of Mc Donalds. The new outlets, which the
company plans to come up with, this would be an excellent way of
introducing something new in the country.
SaurabhGupta 82
WIMPYS
 Accessibility: Wimpys could come up with a restaurant at the
International Airport/Domestic airport considering the success of
its NDR station joint.
 Home delivery services could also improve its clientele.
 Compared to the items of McDonalds, the masses do not derive
value for money for certain items and hence its price should be
reduced atleast marginally. If done in places where both are
located, more income could generated by Wimpy’s
NIRULAS
 Accessibility: Nirulas should look at more and more places like
“Destination Point” and “Leisure bowl” to expand its chain of
outlets.
 Standard of hygiene: People of India are becoming more hygiene
conscious. Therefore the management needs to become more
hygiene conscious. The restaurant should start providing with
SaurabhGupta 83
disposable spoons, plates etc., Mineral water should also be
provided free of cost.
 Décor: Any new restaurant that Nirulas plans to come up with
should be spacious, vibrant and give a pleasant look.
 Services: Staff needs to be more efficient and friendly.
 Other than the variety provided by Nirulas a low calorie diet could
also be added to its menu. This would attract health conscious
people into the restaurant thus improving its customer base.
 The company’s plan of opening up of outlets in West and South
East Asia should be materialized as soon as possible as this would
affect the image of the restaurant nationally.
Common Recommendations for all three : Overnight services could
be started by a few joints of Nirulas , Wimpy’s and McDonald’s.
Since overnight services are there at McDonald’s restaurants in
certain parts of the world, it could start these services in India too.
However these restaurants can quote extra charges for their
service after 12’O clock midnight.
SaurabhGupta 84
BIBLIOGRAPHY
Sources Referred
1. Internet : McDonalds Website
Nirulas, Website.
2. Company Literature : McDonalds India Information Booklet
Nirulas Company Information Booklet,
3. News Papers : Economic Times
Dated - 15th September 1995
July 21st 1996
4. Magazines : A & M - Issue 15th February 1997
A & M - Issue 31st May 1998
A & M - 15th January 1995
First City - January 1997
5. McDonald’s Restaurant Brochures
6. Nirulas Restaurant Brochures
7. Wimpy’s Restaurant Brochures
SaurabhGupta 85

Comparative Analysis of Major Fast Food Joints in India

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INTRODUCTION

Origin of the fast food market in INDIA

These were the traditionally available snacks or in the form of samosas

sweet shops. There were no established eating places or restaurants for

the average Indian customer.

the traditional dhabas, potential restaurants in the customer’s colony

all synonymous with the American concept of fast food as a quick

takeaway bite or a substitute for lunch.

brand recognition. It proved to be a perfect eating place for an average

placed. It is a place where a person from an average middle class group

However the year 1995-96 witnessed a drastic change. 1996 is

International giants such as McDonalds, KFC, TGIF, Dominos, Pizza Hut

all bombarded the Indian food market.

established in Delhi. However it did not pose much of a threat to Nirulas

hangout place rather than eating out with the family.

specialty restaurants offering varied fare such as Chinese, Mexican,

foreign and Indian fast food chains.

However, restaurant business is such which is surrounded by threat from

everywhere be it Indian joints or foreign joints.

It is only these international joints and specialty restaurants which are

gradually coming up and some Indian restaurants which have made up

middle class customer. There was hardly any awareness or promotion to

average Indian restaurant goer is no convenience eater, unlike the

but an American company, which comes and places it directly without

knowing the customer is definitely in for trouble. Customer loyalty in a

restaurant business is essentially low. A customer when he comes to a

restaurant usually looks at the quality of food, variety, ambience, speed

of visits since taste is a dominating factor to the Indian customers.

McDonalds etc., are targeting the families. This serves to be an

propensity to spend because different members order larger variety of

restaurant is delivering to the customers.

World Wide Operations

wimpy operation spreads from Jamaica in the West to the Philippines in

most Northerly restaurant is in Bodo, Norway within the Arctic Circle.

currently about 200 wimpy restaurants operating.

Story behind the name ‘Wimpy’

rounded, hamburger-eating gentleman, whose slow drawn out voice was

this is the name of the Queens guards who according to tradition,

protect the Crown Jewels.

The company in India i.e., Wimpy’s international Ltd., is a hundred

percent subsidiary of Wimpys overseas limited. Wimpys in India is the

master Franchise for South East Asia.

It extends its operations to Katmandu and Sri Lanka. It started its

operations in India in 1989 with the opening of one outlet in Delhi’s

Connought Place area. Today Wimpys has about 15 outlets in the

the next two to three years.

years since it was established, Wimpys is primarily recognised as the

Even today Wimpys aims to target the same audience.

Wimpys as a fast food restaurant has been positioned as a very pleasant

resting-place where a wide variety of items are available through fast

service. It is basically selling ambience and atmosphere.

form of burgers, pizzas, salads, beverages, milkshakes, ice creams and

Any product has three levels

Core product: here a consumer buys a burger or a pizza to satisfy its

Wimpys mentioned on the cover is the actual product.

Augmented product: Ambience, past service atmosphere, cleanliness all

augment the product.

Wimpys has about 5 to 6 different product lines namely:

Following are the range of items at the Wimpys restaurant:

Burgers Pizzas Ice Creams Additional

(in Variety) (in variety) (in variety)

Available in two Includes Nuggets and

increasing choice and variety of items to its consumers.