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By:Abhinav khanduja Aayush sharma Nalini katiyar Mohit rathi Kriti singh Keshav kishore 208 209 215 220 236 261
• To study the operations and supply chain management of Mc Donalds and Dominos.
Flow of the presentation
• • • • • • • • Introduction. Mc Donald industry. Logistics of Mc donalds. Dominos. Logistics of Dominos. Recommadations. Conclusions. Refrences.
Industrial growth is 40% a year. Foreign investments are worth Rs. .675 crore.3600 million (1/4th total investment in this sector) McDonalds India is the market leader in this industry.FAST FOOD INDUSTRY World’s largest growing food type. The organized pizza market in India is worth about Rs.
MAJOR PLAYERS .
McDonald’s opened its first restaurant outside U.McDonald’s History It started as a drive-in-restaurant in the late 1940’s.S in Canada. In 1996. McDonald’s entered India in a joint venture. In 1966. McDonald’s was listed on the New York Stock Exchange. In June 1967. McDonald’s now has a network of over 160 restaurants across the country .
McDonald’s System – the World’s Best QSR experience World Market Leader in the QSR area (Quick Service Restaurant) Franchise System (75%) System employees: 1. Cleanliness and Value Plan To Win -> Successful business revitalization .6 million Customers Per Day: 58 million Corporate Strategy: QSC&V: Quality. Service.
PRODUCTS Vegetarian Menu .
Non-Veg Menu .
higher in urban areas 2-3 stops per route Exclusive distributors (3PL) Strong quality focus (Cold Chain.McDonald’s SUPPLY CHAIN McDonald’s Supply chain is based on the three-legged stool concept : Company – Franchisees – Suppliers Logistics 100 sales items in the restaurant 400 SKUs in the warehouse 200 restaurants per DC (~180 DCs globally) Delivery frequency: ~3/wk. HACCP. QIP) .
McD India has pioneered the cold chain management system.McDonald’s took 4 years and around Rs 450 crores to set up the food supply chain even before opening its 1st restaurant. They provided assistance in the Selection of high quality seeds Drip-irrigation technology Refrigerated transportation system .
Dynamix Dairy Industries (Supplier of Cheese) Fully automatic international standard processing facility. Dedicated R&D centre . Network of milk collection centres equipped with bulk coolers. Dedicated quality program.SUPPLIERS 1.
The pack house.2. pre-cooling and cold room are located at the farms itself to ensure no delay. Trikaya Agriculture (Supplier of Iceberg Lettuce) Specialized nursery with a team of agricultural experts Drip and sprinkler irrigation in raised farm beds with fertilizer mixing plant. .
3) Vista Processed Foods Pvt. Ltd. (Supplier of Chicken and Vegetable products)
World class infrastructure and support services.
Separate processing lines for chicken and vegetable foods. Hi-tech refrigeration plants for manufacture of frozen food at temperatures as low as -35⁰C.
Radhakrishna Foodland Ltd.
Specialized in providing services
procurement quality inspection storage inventory management deliveries data collection recording and reporting
Dry and cold storage facility Transportation trucks maintained at 22⁰ C Implemented ERP software.
OUTSOURCING THE INGREDIENTS
ITEM Cheese Dehydrated onions Iceberg lettuce PLACE Dynamix Dairy Industries Ltd., Pune Jain Foods, Jalgaon Trikaya Agriculture, Pune
Veg. Patty, Veg. Nuggets, Pie’s Chicken (dressed) Buns Eggless mayonnaise Sesame seeds
Vista Foods, Taloja
Kitran Foods, Taloja Riverdale, Talegaon Cremica Industries, Phillaur Quaker Cremica Pvt. Ltd., Phillaur Ghaziabad
Fish fillet patties
Vegetable for the patties Mutton and Mutton Patties
Amalgam Foods Ltd., Kochi.
Finns Frozen Foods, Nasik and Jain Foods, Jalgaon Al Kabeer, Hyderabad
Hazard Analysis Critical Control Point (HACCP) Based on HACCP guidelines.Quality Inspection Programme (QIP) carried out in the Cold Chain system. control points and critical control points for all McDonald's major food processing plants and restaurants in India have been identified. .
SUPPLY CHAIN INTEGRATION .
chiller. Refrigerated trucks with multi-temperature facility divided into 3 zonesfreezer. Reference: National Retail Federat -Case Study .Contd… Mc Donald’s India sources its ingredients from local suppliers who are an integral part of the cold chain. and ambient to ferry product demanding varying temperatures from supplier location to the distribution centre.
as are the trucks for storing products.Contd… Distribution centre is also divided into multi-temperature zones . Reference: National Retail Federat -Case Study . and room temperature. chiller at 33 degree F to 40 degree F. With freezer at 0 degree F to 33 degree F .
Restaurants have in built cold storage units subdivided into same aforesaid zones –freezer. chiller . .and National Retail Federat Reference: -Case Study ambient.
chilled & any dry goods Food /nonfood: Frozen . chilled & any dry goods Procurement logistic Warehousing & packaging Distribution logistics # Consumer/outlets C Donald’s Supply Chain (160 restaurants across the country) .38 suppliers across the country Food /nonfood: Frozen .
Delhi Ferrocoa Farm.Punjab Batter & Breading Cremica Industries . Khopoli . Potatoes and Rice) Kiltran foods. Ludhiana . Phillaur.MH & Cremica Industries. Carrots. Dehradoon Vegetable Patty (Made from fresh Peas. Noida Iceberg lettuce Trikaya Agriculture .Supply of ingredients: Sesame seeds Ghaziabad. Taloja MH Reference: mcdonaldsindia.Punjab Buns Shah & sons. UP Special vegetarian sauce (Eggless) Quaker Cremica. Talegaon MH Meena Agritech .Green beans.com .
avoided pork and beef products. do as Romans do! Mc Donalds customized its products to Indian taste-buds. to develop its supply chain) • In Rome .LESSONS: • Look before you leap. In addition the processing lines for vegetable and non-vegetable products are kept separate. also to connect to the public. (Mc Donalds did an extensive research before venturing into this nation for more than 4 years and put in 450 crores plus during those times. the trust must carry the relationship. . In other words-“You must allow market forces and not binding agreements to determine just who the constituents of your supply chain will be. • Principle of mutual need: If one can assure one’s vendor that both are interdependent on each other.
Michigan. Monaghan (Thomas) and James S. and one of his employees suggested the name Domino’s Pizza (Domino’s). Dominick De Varti (Varti) owned a small pizza store named DomiNick’s Pizza on the Eastern Michigan University campus in Ypsilanti. Monaghan bought that store. In 1960. . Thomas decided to change the name of his first store. two brothers who were students of the University of Michigan – Thomas S.BACKGROUND NOTE In the late 1950s. DomiNick’s Pizza.
70 percent of its revenue comes from home delivery service & around 30 percent is over-the-counter sales.OVERVIEW Founded in 1965 by Tom Monaghan. Domino's Pizza outlet in India opened in 1996. Second-largest Pizza chain in the United States. about 8.500 corporate and franchised stores in 55 countries. Close to 274 outlets in 55 cities of India. .
Pawan Bhatia. Bhatia planned to open 150 new outlets by the end of 2002 covering 23 cities(Tier-I).DOMINO’S INDIA In early 2000. He had frantically reworked the pizza chain's India strategy. .including Bhubaneshwar (Orissa) and Jamshedpur (Bihar). from sourcing raw materials to shipping them for processing at a central location to delivering it to the customer's. the former CEO of Domino’s Pizza India (Domino’s) was a man in a hurry. As part of its expansion plans Domino's revamped its entire supply chain operations.
CORPORATE STRATEGY “ Exceptional people on a mission to be the best pizza delivery company in the world! " 'Think global and act local’ Fun. happiness and convenience .
PRODUCTS Pizzas Pastas Breadsticks Cheese Dips Beverages Chocolava .
International . Delivers an average of 1 million pizzas per day. they opened stores in 15 new cities. Domestic supply chain 3. Over the last 2 years. Domestic stores 2.OPERATIONS Indian operations are ranked number one for the past 3 years. The company operates in three segments: 1.
.1. 2. Domestic Supply Chain Vertically integrated supply system automatic delivery of raw materials cuts out a lot of the "back of-store" activities. Domestic Stores uses its company-owned stores as a testing ground for new products and technologies which may then be passed onto franchisees. Helps in keeping down food costs. generates income from companyowned stores in the form of store profits.
469 franchised stores outside the United States. International segment accounts for about 41% of Domino's store sales worldwide. .3. operates six supply chain centers which manufacture dough and distribute food and supplies. International consists of 3.
DOMINOS SUPPLY CHAIN 1. baby corn. Bangalore 3. tomatoes and spices are got. Mumbai . Delhi 2. Kolkata 4. 4 commissaries (Regional Centralized Facilities) 1. Procurement of raw materials Raw materials like wheat. out of which wheat was bought in from jalandhar and then sent to the commissaries in refrigerated trucks.
Logistics requirement for sending frozen foods. at a temperature of ₋18⁰C and of refrigerated trucks in which food is sent at a temperature range of between 1 to 4⁰C. Distribution Pizza dough processed from the wheat is then sent to the retail outlets again in refrigerated trucks. .2.
. Regular stores 2. Super stores : High traffic.3. Express stores : those where people were expected to walk in and order rather than ask for home delivery. Retail Outlets 1. More counters 3.
SUPPLY CHAIN DIAGRAM WHEAT RETAIL OUTLET DOUGH REFRIGERATED TRUCK WAREHOUSE .
Haryana Bhubaneshwar. Orissa South India Nepal Sri Lanka Australia Spain .Outsourcing the Ingredients ITEM PLACE Wheat Cheese Tomatoes Spice Baby Corn Exotic Vegetables Pepperoni Jalapeno Jalandhar (Punjab) Karnal.
They cant go for centralized system.ISSUES • Domino’s were in 16 cities so the level of complexity is bit high for them. • The retail outlets had to use up the processed dough within three days of delivery. • Need of call center. .
which then took on the task of delivering the order 30 minutes. Domino’s introduced a common toll-free number in all the 16 cities it operated. . his location was identified and the order was transferred to the nearest Domino’s outlet.THE PIZZA HOTLINE In April 2000. which had been branded as the Hunger Helpline It worked seemed simple: each time a customer called.
LAYOUT PLAN .
PRODUCT OFFERINGS Pizzas Pastas Breadsticks Cheese Dips Beverages (tie-up with Coca Cola) Choco Lava Cake Chicken Wings .
PRODUCTION Dough Table •Pizza Base prepared •Cheese blend applied Makeline •Seasoning •Topping Oven •470 Fahrenheit •Capacity of 5 pizzas at a time 1-2 minutes 1 minute 5-6 minutes Turnout is 1 pizza per minute Meets the current demand requirements Bottleneck is oven .
Capsicum and Onion purchased locally • Delhi • Bangalore(caters to 90 outlets across South Zone) • Kolkata • Mumbai .RAW MATERIALS AND PROCUREMENTS 4 commissaries (Regional Centralized Facilities) across India: Raw materials like wheat brought in from Jalandhar and sent to commissaries via refrigerated trucks Tomato.
DISTRIBUTION Dough balls processed from wheat are sent to retail outlets in refrigerated trucks HUB AND SPOKE MODEL with commissaries as hubs Frozen food sent at 18 deg Celsius .
LOGISTICS WHEAT (JALANDHAR) SUPPLIERS (Toppings & Seasonings) RETAIL OUTLET DOUGH COMMISSARY REFRIGERATED TRUCK .
Capsicum 5 days 3-4 days 4-5 days 4-5 days 5 days Cheese Blend 4-5 days .INVENTORY MANAGEMENT ITEM SHELF LIFE Dough ball Mexican Wrap Base Cheese Dip Seasoning and Toppings Onion. Tomato.
CONTD… Mini Cold Storage at Outlet (Walk In) Maintain approximately 4 days of inventory Trucks from commissaries replenish inventory every 4 days Inventory levels are monitored centrally via POS data using Intura Vision installed in every outlet Two POS per outlet (Telephonic sales and In Store Sales) .
OPERATIONAL STRATEGY Hub and Spoke Distribution • Hubs at 4 commissaries Delayed Differentiatio n • Tomato. Onion etc. purchased locally • To cater to sudden variability's in demand • To try to get volumes up during lean times IST (Inter Store Transfer) Sales Incentives . Capsicum.
.QUALITY INITIATIVES • SCIP (Store Continuous Improvement Plan) – Sales – Training • FTD (Friday Training Day) – HTR (Handle The Rush) – Rubber Gloves.
CUSTOMER SERVICE Making improvement through team work and employee empowerment Continuous improvement at its base Belief that all meaningful ideas are good and must be implemented Everyone is expected to give suggestions on regular basis Award System(Tokens. Scores) .
ISSUES RECOMMENDATIONS COMPETITION .
ISSUES RECOMMENDATIONS COMPETITION Local manufacture of dough balls to reduce wastage • Usage of deep freezer as in other stores Appointing a marketing professional at local level • Authority to introduce offers for short period • For a better market study and introduce new products suited to local preferences Inter Store Transfer • Dominos Should have a big store in Bangalore. .
ISSUES RECOMMENDATIONS COMPETITION Pizza Hut is the competitor to the Domino’s Pizza .
From the study done among the 3 fast food services – McDonalds. we can clearly come to the conclusion that McD with its superior supply chain management (cold chain) is able to balance between its quality and cost. The setting up of cold chain has enabled it to cut down on its operational wastage. Dominos and Pizza hut.CONCLUSION Fast Food industry in India is growing at a fast rate. .
mcdonadlsindia.books.wikipedia.org www.inboundlogistics.supplychain.in www.com www.google.in www.distributionchain.advancesupplychain.co.org www.com .co.in www.com www.dominos.REFRENCES • • • • • • • • www.