Name SWB

Year of Commencement Year 1980

Capital Rs 20000
Nos. of Stores
Sqr Feet 400
EXHIBIT 1: REVENUES OF SHREE WADESHWAR BHUVAN (SWB)
# DATA & CALCULATIONS RESULTS
A Number of customers served per day (# Customers/Day) 320
B Number of days open in a year (days) 365
C Average billing per customer (INR/Customer) 65
D Annual Revenue (INR) [ D = A * B * C ] 7,592,000
E Annual Revenue of SWB (in INR million) [ E = D/1,000,000 ] 7.59
# DATA & CALCULATIONS RESULTS
F Capacity to serve customers (# Customers) [ 100 seated outdoors + 30 seated
The average billing at WRD was INR130 per customer. WRD remained open seven days a week from 7.30 a.m. to 11
p.m. It averaged an occupancy rate of 60 per cent in the mornings from 7.30 a.m. to 9.30 a.m. and also had 60 per
cent occupancy from 4 p.m. to 7 p.m. It had nearly 90 per cent occupancy during lunch hours from 12 noon to 3 p.m.
G Number of hours of full occupancy per day:
 7.30 a.m. to 9.30 a.m. = 2 hours * 60% occupancy = 1.2 hours full occupancy
 12 p.m. to 3 p.m. = 3 hours * 90% occupancy = 2.7 hours full occupancy
 4 p.m. to 7 p.m. = 3 hours * 60% occupancy = 1.8 hours full occupancy
 7 p.m. to 11 p.m. = 4 hours * 100% occupancy = 4.0 hours full occupancy
Thus, total hours of full occupancy = 1.2 + 2.7 + 1.8 + 4.0 = 9.7 hours
9.7
H Average billing per customer (INR/Customer) 130
I Number of days open in a year (days) 365
J Annual Revenue (INR) [ K = F * G * H * J ] 59,834,450
K Annual Revenue of WRD (in INR million) [ L = K/1,000,000 ] 59.83

 300 cars stopped at Smilestone every day, and there was an average revenue of INR225 per car.
 About 100 luxury buses stopped at Smilestone every day with each bus averaging 30 to 35 passengers, who
each spent INR50 on food.
 Each of the two shops that were self-managed by Smilestone achieved a turnover of INR20,000 per day.
 Smilestone received an average rental of INR20,000 per month from each of the six shops that were rented out.
 Smilestone’s deal with CCD was that Smilestone received the greater of either INR150,000 per month as rent or
received 5 per cent of monthly revenue.

EXHIBIT 3 (CONTINUED)
# DATA & CALCULATIONS RESULTS
M Number of days open per year 365
N REVENUE FROM CARS
P Average number of cars that stopped per day 300
Q Billing from each car that stopped (INR/Car) 225
Annual revenue from cars = M * N * P 24,637,500
REVENUE FROM BUSES
R Average number of buses that stopped per day 100
S Number of customers per bus (Average of 30 to 35) 32.5
T Average spend of each bus passenger 50
U Annual revenue from Buses U = M * R * S * T = 365 * 100 * 32.5 * 50 59,312,500
OTHER REVENUE STREAMS AT SMILESTONE
V Annual revenue from rented shops (# of rented shops) * (monthly rent) * 12 = 6 *
20,000 * 12
1,440,000
W Annual revenue from shops managed by Smilestone (# of shops) * (daily
revenue per shop) * 365 = 2 * 20,000 * 365
14,600,000
X Revenue from CCD outlet (greater of INR 5% of monthly revenue or INR150,000
rent per month). As case does not provide information on CCD’s revenue, we
can assume 150,000 per month or (1,500,000 * 12) annually
1,800,000
Y TOTAL ANNUAL REVENUE OF SMILESTONE (INR million)
Y = (Q + U + V + W + X)/1,000,000
Y = (24,637,500 + 59,312,500 + 1,440,000 + 14,600,000 + 1,800,000)/1,000,000
101.79
101.79
Source: Company sources.
EXHIBIT 4: REVENUES OF KALPAK CATERERS
# DATA & CALCULATIONS RESULTS
REVENUE FROM WEDDINGS
a Number of weddings catered per year 70
b Average number of guests per wedding 800
c Average billing per person catered 900
d Annual revenue from weddings (in INR million)
d = (a * b * c)/1000,000 = (70 * 800 * 900)/1,000,000
50.4
REVENUE FROM OFFICE PARTIES
e Number of parties catered per year 45
f Average number of guests per party 200
g Average billing per person catered 600
h Annual revenue from parties catered (in INR million)
h = (e * f * g)/1000,000 = (45 *200 * 600)/1,000,000
5.4
TOTAL REVENUE
j Total Annual Revenue of Kalpak Caterers (in INR million)
j=d+h
55.8
Source: Company sources.
EXHIBIT 5: INFORMATION ABOUT COFFEE HOUSE
 Location: Coffee House was located in the posh Pune Camp locality and surrounded by shopping
centres, malls, offices and upmarket residential areas.
 Menu: It was a full-service restaurant that served tasty and hygienic snacks and meals.
 Size: It was a large, 175-seat restaurant, which included a 45-seat air-conditioned hall and a 20-seat
party hall.
 Ambience: It had an excellent ambience; interiors had been renovated three years ago.
 Ownership and management: It had been run for the last 35 years by its owner, who was planning
to retire shortly; there was no second generation who would inherit the restaurant.
 Revenue and Profits: It was estimated that Coffee House generated sales revenue of INR4 to 4.5
million per month and that its profitability was similar to that of WRD.
 Other information about Coffee House:
– Overall, Coffee House was an attractive restaurant to take over as it had excellent interiors, a
large and well-set kitchen and excellent staff.
– Another advantage was that it was an established restaurant, and therefore any new owner (such
as Swanand) would not have to secure new licences and permissions from various municipal
departments. In effect, if Swanand was able to secure a deal with Shetty, he could start
operations there within a week. A few cosmetic changes to the signage and the menu cards and
an announcement that the restaurant was now under new management were enough.
– Another advantage of trying for a deal with Coffee House was that given Shetty’s long emotional
attachment with the business, he might be persuaded to stay on as manager for a few months
while Swanand settled in to his role as the new owner.
Source: Company documents.
EXHIBIT 6: INFORMATION ABOUT JAYASHREE RESTAURANT
 Location: The Jayashree restaurant was located on a road in the Market Yard neighbourhood
opposite the wholesale market of fruits, vegetables and grains. Due to this, the area was relatively
down-market in appearance. There were hardly any offices, commercial buildings or shopping
centres in the vicinity.
 Menu: It was a multi-cuisine, full-service restaurant that served tasty and hygienic snacks and meals.
 Size: At 200 seats, it was larger than Coffee House. However, it did not have any air-conditioned
area.
 Ambience: It had an ordinary ambience and its interior had not been renovated in recent years.
 Customers Profile: During the day, it was popular with customers visiting the wholesale market and
with traders who worked there. At night, the restaurant was popular with people living in the vicinity.
 Other information about Jayashree restaurant:
– As the current owner of Jayashree restaurant was shifting to another premise, Swanand would
not have access to the furniture, kitchen equipment and staff as these would be taken away.
– Swanand would have to invest about INR5 million in equipment, interiors, furniture and fixtures as
start-up cost.
– He expected the work to take three to four months from the date he would be handed the
property.
– It was an established restaurant, and therefore Swanand would not have to secure new licences
and permissions from various municipal departments.
EXHIBIT 1: REVENUES OF SHREE WADESHWAR BHUVAN (SWB)
Plot Size
# DATA & CALCULATIONS RESULTS
Capacity
occupany of Hrs
A Number of customers served per day (# Customers/Day) 320
B Number of days open in a year (days) 365
C Average billing per customer (INR/Customer) 65
D Annual Revenue (INR) [ D = A * B * C ] 7,592,000
E Annual Revenue of SWB

# DATA & CALCULATIONS RESULTS

F Capacity to serve customers (# Customers) [ 100 seated outdoors + 30 seated
The average billing at WRD was INR130 per customer. WRD remained open seven days a week from 7.30 a.m. to 11
p.m. It averaged an occupancy rate of 60 per cent in the mornings from 7.30 a.m. to 9.30 a.m. and also had 60 per
cent occupancy from 4 p.m. to 7 p.m. It had nearly 90 per cent occupancy during lunch hours from 12 noon to 3 p.m.
G Number of hours of full occupancy per day:
 7.30 a.m. to 9.30 a.m. = 2 hours * 60% occupancy = 1.2 hours full occupancy
 12 p.m. to 3 p.m. = 3 hours * 90% occupancy = 2.7 hours full occupancy
 4 p.m. to 7 p.m. = 3 hours * 60% occupancy = 1.8 hours full occupancy
 7 p.m. to 11 p.m. = 4 hours * 100% occupancy = 4.0 hours full occupancy
Thus, total hours of full occupancy = 1.2 + 2.7 + 1.8 + 4.0 = 9.7 hours
9.7
H Average billing per customer (INR/Customer) 130
I Number of days open in a year (days) 365
J Annual Revenue (INR) [ K = F * G * H * J ] 59,834,450
K Annual Revenue of WRD (in INR million) [ L = K/1,000,000 ] 59.83

 300 cars stopped at Smilestone every day, and there was an average revenue of INR225 per car.
 About 100 luxury buses stopped at Smilestone every day with each bus averaging 30 to 35 passengers, who
each spent INR50 on food.
 Each of the two shops that were self-managed by Smilestone achieved a turnover of INR20,000 per day.
 Smilestone received an average rental of INR20,000 per month from each of the six shops that were rented out.
 Smilestone’s deal with CCD was that Smilestone received the greater of either INR150,000 per month as rent or
received 5 per cent of monthly revenue.

EXHIBIT 3 (CONTINUED)
# DATA & CALCULATIONS RESULTS
M Number of days open per year 365
N REVENUE FROM CARS
P Average number of cars that stopped per day 300
Q Billing from each car that stopped (INR/Car) 225
Annual revenue from cars = M * N * P 24,637,500
REVENUE FROM BUSES
R Average number of buses that stopped per day 100
S Number of customers per bus (Average of 30 to 35) 32.5
T Average spend of each bus passenger 50
U Annual revenue from Buses U = M * R * S * T = 365 * 100 * 32.5 * 50 59,312,500
OTHER REVENUE STREAMS AT SMILESTONE
V Annual revenue from rented shops (# of rented shops) * (monthly rent) * 12 = 6 *
20,000 * 12
1,440,000
W Annual revenue from shops managed by Smilestone (# of shops) * (daily
revenue per shop) * 365 = 2 * 20,000 * 365
14,600,000
X Revenue from CCD outlet (greater of INR 5% of monthly revenue or INR150,000
rent per month). As case does not provide information on CCD’s revenue, we
can assume 150,000 per month or (1,500,000 * 12) annually
1,800,000
Y TOTAL ANNUAL REVENUE OF SMILESTONE (INR million)
Y = (Q + U + V + W + X)/1,000,000
Y = (24,637,500 + 59,312,500 + 1,440,000 + 14,600,000 + 1,800,000)/1,000,000
101.79
101.79
Source: Company sources.
EXHIBIT 4: REVENUES OF KALPAK CATERERS
# DATA & CALCULATIONS RESULTS
REVENUE FROM WEDDINGS
a Number of weddings catered per year 70
b Average number of guests per wedding 800
c Average billing per person catered 900
d Annual revenue from weddings (in INR million)
d = (a * b * c)/1000,000 = (70 * 800 * 900)/1,000,000
50.4
REVENUE FROM OFFICE PARTIES
e Number of parties catered per year 45
f Average number of guests per party 200
g Average billing per person catered 600
h Annual revenue from parties catered (in INR million)
h = (e * f * g)/1000,000 = (45 *200 * 600)/1,000,000
5.4
TOTAL REVENUE
j Total Annual Revenue of Kalpak Caterers (in INR million)
j=d+h
55.8
Source: Company sources.

EXHIBIT 5: INFORMATION ABOUT COFFEE HOUSE

 Location: Coffee House was located in the posh Pune Camp locality and surrounded by shopping
centres, malls, offices and upmarket residential areas.
 Menu: It was a full-service restaurant that served tasty and hygienic snacks and meals.
 Size: It was a large, 175-seat restaurant, which included a 45-seat air-conditioned hall and a 20-seat
party hall.
 Ambience: It had an excellent ambience; interiors had been renovated three years ago.
 Ownership and management: It had been run for the last 35 years by its owner, who was planning
to retire shortly; there was no second generation who would inherit the restaurant.
 Revenue and Profits: It was estimated that Coffee House generated sales revenue of INR4 to 4.5
million per month and that its profitability was similar to that of WRD.
 Other information about Coffee House:
– Overall, Coffee House was an attractive restaurant to take over as it had excellent interiors, a
large and well-set kitchen and excellent staff.
– Another advantage was that it was an established restaurant, and therefore any new owner (such
as Swanand) would not have to secure new licences and permissions from various municipal
departments. In effect, if Swanand was able to secure a deal with Shetty, he could start
operations there within a week. A few cosmetic changes to the signage and the menu cards and
an announcement that the restaurant was now under new management were enough.
– Another advantage of trying for a deal with Coffee House was that given Shetty’s long emotional
attachment with the business, he might be persuaded to stay on as manager for a few months
while Swanand settled in to his role as the new owner.
Source: Company documents.
EXHIBIT 6: INFORMATION ABOUT JAYASHREE RESTAURANT
 Location: The Jayashree restaurant was located on a road in the Market Yard neighbourhood
opposite the wholesale market of fruits, vegetables and grains. Due to this, the area was relatively
down-market in appearance. There were hardly any offices, commercial buildings or shopping
centres in the vicinity.
 Menu: It was a multi-cuisine, full-service restaurant that served tasty and hygienic snacks and meals.
 Size: At 200 seats, it was larger than Coffee House. However, it did not have any air-conditioned
area.
 Ambience: It had an ordinary ambience and its interior had not been renovated in recent years.
 Customers Profile: During the day, it was popular with customers visiting the wholesale market and
with traders who worked there. At night, the restaurant was popular with people living in the vicinity.
 Other information about Jayashree restaurant:
– As the current owner of Jayashree restaurant was shifting to another premise, Swanand would
not have access to the furniture, kitchen equipment and staff as these would be taken away.
– Swanand would have to invest about INR5 million in equipment, interiors, furniture and fixtures as
start-up cost.
– He expected the work to take three to four months from the date he would be handed the
property.
– It was an established restaurant, and therefore Swanand would not have to secure new licences
and permissions from various municipal departments.
 SWB WRD Smile
400 4000 261000

130 175
9.7 7.5
Nos./Day 320 1261 1312.5
Days 365 365 365 365
Rs. 65 130 130
Rs. 7592000 59834450 62278125 510
Rs in Lakhs 75.92 598.34 622.78
72 600

0.12
130
 Product Category Customer Segments

Arenas SWB Fast Food

Arenas Smilestone Shop Rentals and self service fast Pilgrims, Bus and car passangers
food
WRD Fast Food Office goers, College
Students,Shoppers and locals.
Arenas Kalpak Caterers Catering Services Weddings, parties and coprorate
events
Organic Expanstion
Vehicles SWB Partner Ship
Vehicles Smilestone Joint Venture
Vehicles Kalpak Caterers Wholly owned

Differentiator Quick service of good quality

food
Competitive price
Customized service and personal
touch
Different customer segment

Staging Steady expansion

Target

Economo Good EBDITA margine

c Logic
Efficieny from replication
Brand image
Preffered choice of regular
customers

Year 1980
SWB
Opening 8

to 12 outlets
with a
centralized
kitchen.
strategy must adapt to their resources and their competences It must follow the image of a fam
group that has the ability to serve customers in an efficient and enjoyable way and they must b
to neglect their regular customers They must consider not lowering the quality of their menu w
innovative Their future strategy must also take into account the fact that they own plots outsid
can be sold in order to have cash That means they have financial resources However, their stra
be affected by the government and licensing issues
Market Segments Geography Core technologies

Quick Service Restaurants Pune Urban and Suburban Quick Service With Quality food
Self-Service Restaurants and Pune Ahmednagar Highway Quick Service With Quality food
shop rentals.
Quick Service Restaurants Pune Urban and Suburban

Catering Services Pune Urban and Suburban Quick Service With Quality food

2002 1998 1980

WRD Smilestone Kalpak Caterers
Opening 3 to 4 restaurants on
the Opening a highway Increasing the
same business model by buying restaurant similar to mobility of the
either Coffee House or Smilestone on another teams for parties
Jayashree highway. and office
functions.
Lease space to international
Find a way to differentiate WRD fast food chains as
from its two main competitors, McDonald’s and KFC.
Vaishali and Roopali

Increase operation and process Hiring new managers with

standardization. high involvement.
ences It must follow the image of a family
nt and enjoyable way and they must be careful not
ot lowering the quality of their menu while staying
unt the fact that they own plots outside the city that
financial resources However, their strategy may
Value Creation Stage

The Group

Expanding to other
cities in India.
•
Expanding at an
international level.
•
Buy multiple built
up restaurants
properties.