Type: Process Essays
Sample donated: Jessica Anderson
Last updated: July 14, 2019
In the month of January 2017 Mr. Aftabis worried about the future of his restaurant business while taking a cup ofcoffee with his partner and team. Thinking about to move from one location toanother because of the huge losses -in July 2016 revenues were PKR.235000/=down to PKR.110000/= in December 2016-,customers are not returning and losing the customers on regular basis despitethey are giving the good taste and services to the customers. Mr.
Aftab wasexchanging ideas with the partner and team, concerning how to improve therestaurant service delivery process, what steps we should take to regain thecustomers and overcome the losses and make it success in future.Background Mr. Aftab after graduating with amarketing degree and experience of sixteen (16) years in multinational company,and having a big family. He was passionate about food and wants to open a restaurant.One day while having lunch in the restaurant, Mr. Aftab was captivated with theidea of starting his own food business as he felt he would be able to run itmuch better way to be a successful business. Mr.
Aftab opens a restaurant atsmall scale on 5th December 2015. After seeing a good run in arestaurant with a limited menu, he was thinking about to expand it. But he wasworried about the investment. Once his family friend Mr. Bashir came to hisrestaurant for dinner he was motivated by seeing him and his efforts that howhe is doing a business, they both were talking about the business andexpansion. His friend saw an opportunity to invest, he made an offer to investfor the expansion of this restaurant and work as an equal partner in thisventure under some conditions that have been made with the consent of both ormutual agreement.
Mr. Bashir was working on a privateproject, experienced in installation and dismantling of telecom towers and alsohaving some foreign exposure. After ending of the project, he went for theinvestment in the food business. Mr. Aftab and Mr. Bashir then restructure andrenovate the business to make it more attractive and profitable. They bothinvest PKR.500000/= and employed 4 peoples-waiters- from locality for servicedelivery.
They operated this business as a project under the name of SABenterprises-initials letters of their name-.Trends in Sukkur and Competition:This industry is changing day by dayfor more advancements in the foods due to that there is huge competition andopens the door for the new comers to compete in that business. As in Sukkur thefood business had grown rapidly in the previous decade there is low concept ofvariety of food and fast foods, but now in every street there is food corners.Now a day’s people love to eat food outside of their homes at the restaurantsand spots. According to the statistics seeExhibit 1: the salaried person spending average of their income at the restaurantin the month. This gives the restaurants an edge to bring new innovations andadvancement in their menus at reasonable costs.Competitors:Their competitors are, Al-Habib Restaurant located at the distance of 800meters. Lasani at the distance of 1600 meters, and other restaurants in theline, like Nawab Tikka House, and other local restaurants and also theemergence of Sindhri from Dhabba to restaurant make the competition intense.
Segmentation and TargetingThey are segmenting the customers intwo groups and targeting; one who are the employees in the nearby offices forthat customers they are providing the lunch on the payment of monthly basis;And the other who are local peoples used to come for outing and fine dining.They are also giving the discounts to the office employees. And also they areproviding home delivery service within the locality; radius 4 kilometers.Marketing Mix:Menu: Theremenu consist of few dishes at the initial stage before expansion, consist ofBiryani and green and white Karhai at the lunch time, and in dinner they addedBBQ-Tikka and Kabab. After the investment they reset the menu with variety ofdishes under the category of Desi, Chinese, BBQ, Tea and Beverages. (See exhibit-2 for full menu).
And lateron they added some fast foods itemsPricing: Thefood was made fresh after the placement of order. Their aim was to give thequality food at reasonable price providing significance against money in termsof service and taste. A feast of two charged around 300 PKR. (See exhibit-2 for full prices)Location: Goodfood was located in a rented space in the upscale B-81, Hamdard society,Sukkur, because of the offices and innumerable residential building in thelocality, after much hunt for the location Mr. Aftab chosen this particularlocation for convenient and accessibility. Promotion: AsMr.
Aftab was a marketing graduate, he thought that (BTL activity) will givebetter exposure to the good food. And also they visit offices nearby formarketing purposes and uses word of mouth communication. They interact with thecustomers to know the taste and preference of the customers in food. The ideawas to use personal selling and interaction to build rapport, in turnencouraging word of mouth recommendations. And also he uses the billboards andflyers to make it visible to the customers of their existence.
On different occasion they are alsogiving some deals and discounts coupons in the magazines.Ambience: Theyplanned the interior like, the customers feel like it as a home, because thelocation was set like a bungalow. They are giving the homely touch. Theambience was one that would appeal to a young adults and families, andproviding the cool, calm and comfortable space. Staff and Services: The staff was consists of 11 skillful and trained staff. Three chefs asone for Desi foods, one for Chinese and one for BBQ.
And Desi foods chef haveone assistant who assists him with helping hand for cutting and washing of theingredients. Four waiters as the two for customers who sit outside of therestaurant and two for the customers who sits inside like families and others.And one person is responsible for home delivery services. One is a dish washerwho is responsible for the washing and cleaning of the used utensils and makesit hygiene for the next use.
Way ahead:The dilemma is Mr. Aftab and Mr. Bashiris losing customers and thinking on the plan. They were searching about theproblem what happen to this venture, why they are losing customers? After fewdays spent on research they come to know, according to some regular customers:they were not consistent with the taste that they are providing in Desi foods.Other than this reason there was complaint of service delivery that they aretaking more time to deliver their foods to the destinations. Mr. Bashir suggesthim to change the location of the business or start a new venture with newname, new place that starts from the scratch.
And one of his team members alsogave suggestion to change the Chefs and go with the current restaurant andreposition them. What should they do? Is it viable to change the chefs or gofor the new location with new name? If they change the chefs, how they shouldchange the customer perception about the taste consistency of the good food?What type of strategies will be helpful for them to cater this type ofsituation?