Dosa king franchise

IMB 439

U. Dinesh Kumar, Professor of Quantitative Methods and Information Systems, prepared this case for class discussion. This case is not intended to serve as an endorsement, source of primary data, or to show effective or inefficient handling of decision or business processes.

Copyright © 2013 by the Indian Institute of Management Bangalore. No part of the publication may be reproduced or transmitted in any form or by any means – electronic, mechanical, photocopying, recording, or otherwise (including internet) – without the permission of Indian Institute of Management Bangalore.

U. DINESH KUMAR

DOSA KING: A STANDARDIZED MASALA DOSA FOR EVERY INDIAN

On August 31, 2013, the famous Madras Club in Chennai was buzzing with visitors searching for a place to relax over the weekend. I met R. Narayanan, an entrepreneur, in one of the small rooms in the Madras Club. We placed our order for tender coconut water and coffee. Without wasting much time, I asked Narayanan to share the story of one of his initial ventures, the Dosa King. The Dosa King was aimed at providing hygienic and standardized masala dosas across India. A dosa is a savoury pancake made from a fermented batter of rice and black lentils; a masala dosa is a dosa with a potato masala (spiced potatoes) filling. Masala dosas (Exhibit 1) are usually served with several accompaniments, such as coconut chutney and sambar (a kind of spicy lentil and vegetable stew). According to Narayanan:

Dosa was by far the single most popular snack across the length and breadth of India; yet, eating places that served dosas in many parts of the country, especially in north India, were limited in number, largely due to the lack of understanding about the “formula” for the dosa as well the lack of an “expert” dosa maker.

Narayan established Indian Foods and Fermentations Ltd. (IFFL) in 1992 to offer a total solution to the problem stated above with an objective to develop an electronically controlled operator assisted dosa machine (ECOAD). According to market research conducted by IFFL in 1992, 20 million dosas were consumed in India on any given day. Narayanan and his colleagues at IFFL decided to come up with a complete dosa delivery system. The following requirements for the dosa delivery system were set by his team.

1. To design a dosa-making machine that could deliver consistent dosas at 30-second intervals, with uniform weight, crispiness, color, size, and taste.

2. To develop a dosa batter in dry or wet form with a shelf life of 4 weeks under refrigeration, which could be transported and used in any part of the country.

3. To develop a potato masala that could be automatically dispensed from the dosa machine in consistent quantities as desired.

4. To deliver the dosa to the customer in a convenient form such as a roll, so that the customer could eat the dosa on the move.

Narayanan was confident that the Dosa King would change the landscape of fast food restaurants in India.

BACKGROUND

Narayanan held a Post-Graduate Diploma in Management from the Indian Institute of Management Calcutta and a Bachelor’s degree in Commerce from Chennai. Narayanan worked for Coca-Cola and Nestlé before setting up Indian Foods and Fermentations Ltd. After several years in the food industry, Narayanan saw an opportunity in the fast food business in India. In 1992, India did not have any western fast food chains such as McDonalds, Burger King, or KFC. Restaurants were managed as small business entities by a few entrepreneurs and there were no major restaurant chains across the country. India went through a period of major economic reform in 1991 and the economy started growing much faster after the nineties. Narayanan expected the demand for fast food to grow in all major cities of India. Equipped with his experience at Coca-Cola and Nestlé, Narayanan was confident that he could change the restaurant industry in India. This strong belief led to the creation of the IFFL in 1992.