Patronizing Fast Food Retail Sector in India

Contents Executive summary3 Introduction4 Research design5 Main objective5 Scope5 Sample and Research design5 Tools and Methods of Data Collection6 Measurement7 Data Processing and Analysis7 Analysis & Interpretation7 Major Findings14 Major suggestions:15 Annexure16 Fast Food Retail Outlet-Questionnaire16 Chi-square test19 References:20 Executive summary In recent years, a major food consumption trend in urban parts of developing countries is that more consumers are eating more meals outside of their homes.

Most of the growth in away-from-home eating has been in the fast food sector. In this increasingly competitive industry, while franchising has become a popular vehicle for the fast food sector’s growth and maintaining profitability in the shrinking market share, it also provides target customers with high quality and efficient service. As a result, along with the socio-economic, demographic and behavioral changes, consumer demands for eating out and purchase of fast foods have drastically changed.

The findings of this study offer need-oriented types of marketing strategies in India to enable fast food outlets to be more competitive. On the above research purpose this paper analyzes the behavior of consumers in selecting fast food retail outlet/s. The methodology includes exploratory research design i. e. qualitative research in form of focus group discussion and descriptive research in form of questionnaire. Initially the factors for consideration of fast food outlet are being highlighted through the focus group discussion among the group members.

Based on the factors that emerged out of discussion, a questionnaire was designed. Based on the study it can be suggested that for patronizing the fast food retail outlets, the outlets should operate globally but act locally insuring highest quality food at the same time laying emphasis on reach of the outlets and also concentrating on the price structure, service quality offered by the outlet to gain competitive edge in the market. Introduction Fast food retail industry Fast food is one of the world’s largest growing food types.

India’s fast food industry is growing by 40% a year and is expected to generate a billion dollars in sales by 2013. The multinational segment of Indian fast food industry is up to Rs. 6 billion, a figure expected to zoom to Rs. 100 billion by 2010. In last 6 years, foreign investment in this sector stood at Rs. 3600 million which is about one-fourth of total investment made in this sector. Because of the availability of raw material for fast food, Global chains are flooding into the country. Major players in fast food are: MCDONALDS • KFC • PIZZA HUT • DOMINOS PIZZA. • COFFEE DAY • BARISTA. • SUBWAY The main reason behind the success of the multinational chains is their expertise in product development, sourcing practices, quality standards, service levels and standardized operating procedures in their restaurants, a strength that they have developed over years of experience around the world. The home grown chains have in the past few years of competition with the MNCs, learnt a few things but there is still a lot of scope for improvement.

But Fast food chains have also come under fire from consumer groups, such as the Center for Science in the Public Interest, a longtime fast food critic over issues such as caloric content, trans fats and portion sizes. These movements seek to preserve local cuisines and ingredients, and directly oppose laws and habits that favor fast food choices. Proponents of the slow food movement try to educate consumers about what its members considers the richer, more varied and more nourishing tastes of fresh, local ingredients that have been recently harvested.

Research design Main objective The main objective of our study is to provide valuable insight regarding the consumer behavior in selecting fast food retail outlets so as to provide suggestions for the retail outlets to gain a competitive edge in the industry. In line with the main objective there are various key issues which are being tried to address: ? What are the main attributes that drive customer to a particular fast food retail outlet? ? Is there any relation between frequency of visit and amount spent in each visit? Which is the main media driver for consumer to get information about the fast food retail outlets? Scope The scope of the study is limited to only the branded fast food retail outlets. For the convenience of the study the collection of data is through questionnaire which is restricted to a sample of 50 respondents including students and households. Limitation of the study is restricted to simple calculation of mean, percentages and bar diagrams which may not be true always. As our sample consists of majority of the students for whom income is not the critical factor for visiting retail outlet.

Sample and Research design The study is based on the primary data which is collected from sample size of 50 people where 30 are students of VJIM and 20 are from various households. We are taken this sample because of most of the visitors of Fast food outlet are students and present generation households. We have used non probability convenience sampling for selecting the students because in Non-probability sampling is any sampling method where some elements of the population have no chance of selection or where the probability of selection can’t be accurately determined.

It involves the selection of respondents based on assumptions regarding the population of interest, which forms the criteria for selection and Convenience sampling or opportunity sampling which involves the sample being drawn from that part of the population which is close to hand. Hence, because the selection of elements is nonrandom, non-probability sampling does not allow the estimation of sampling errors. Example: for selecting the households we visited every household in Vijay Nagar Street, and interview the first person to answer the door. For the descriptive research design we have identified the 6 W’s which are Who-for students, anyone who is a student of vjim batch 17 ? For households, anyone who answers the door we went for interview ? What- frequency with which fast food retail outlets are patronized depending upon specific attributes ? When- for student anytime after the college hours and for households on Sundays ? Where- for students in the college and for households in their homes ? Why- improve patronage and likeability of fast food retail outlets ? Way- through questionnaire. Tools and Methods of Data Collection 1) The data about the fast food retail outlets was collected through secondary source i. e. internet ) The Focus group discussion was conducted among the members of the group wherein following points were discussed ? The objective of the study ? Who will be the respondents and how to choose them? ? Which brands of fast food retail are mostly preferred? ? The attributes which are necessary for attracting consumers to the fast food retail outlet/s ? From where to collect the primary data and techniques to be used to analyze. With the help of the discussion, a questionnaire was designed and was given to selected sample with the objective of getting the desired information which can form a basis for our study.

The questionnaire was framed in a way to motivate respondents to be involved in it and reduce the response error. Measurement The information needed to address the research objectives of this study are: ? Personal details (Name, Age, Sex, Occupation) ? Frequency of visit of respondents ? Attribute that is most preferred in selection of fast food retail outlets outlet like price of the item, accessibility and location, the quality of the service, and the speed of the delivery of the item. ? Amount spend on one visit

Data Processing and Analysis The data processing consists of coding the data collected in the form of questionnaire. The data collected with the help of questionnaire is having the closed and open ended replies. Open ended replies have been taken as per the repetitive answers given and for the close ended the replies are measured using scales. Statistical tools like mean and chi-square tests were used to analyze the obtained data and derive results. Analysis & Interpretation 1. Frequency of visit   |sample of 20 |sample of 30 |sample of 50 | |once in a week |4 |10 |14 | |twice in a week |2 |9 |11 | |once in a month |12 |8 |20 | |once in a year |0 |3 |3 | |Never |0 |0 |0 | |Other |2 |0 |0 | |Total |20 |30 |50 | [pic] Interpretation From the above table and graph we can infer that majority of the household and employees visit the outlets once in month, whereas majority of the students visit once in a week. On the whole 40% of the respondents (majority) visit the outlets once a month basis. 2. Most preferred fast food outlets   |sample of 20 |sample of 30 |sample of 50 | |McDonalds |9 |11 |20 | |Domino’s Pizza |5 |7 |12 | |Pizza Hut |7 |12 |19 | |Subway |6 |2 |8 | |Barista |1 |3 |4 | |KFC |6 |5 |11 | |Coffee Day |6 |7 |13 | |Other |5 |4 |9 | |Total |45 |51 |96 | [pic] Interpretation From the responses we inferred that McDonalds is preferred more by households whereas students prefer Pizza Hut when compared to other outlets. Over all McDonalds is preferred more than other outlets. 3. The going behavior   |sample of 20 |sample of 30 |sample of 50 | |Friends |8 |15 |23 | |family members |10 |14 |24 | |peer group |2 |1 |3 | |Alone |0 |0 |0 | |Total |20 |30 |50 | [pic] Interpretation From the above table and graph it can be inferred that majority of the students visit the outlets with their friends whereas household prefer to visit with their families. Overall respondents (48%) prefer to go to these outlets with families. 4. Time slot of visiting   |sample of 20 |sample of 30 |sample of 50 | |before 11am |0 |0 |0 | |between 11am & 2pm |3 |3 |6 | |between 2pm & 6pm |2 |8 |10 | |between 6pm & 10pm |15 |17 |32 | |after 10pm |0 |2 |2 | |Total |20 |30 |50 | [pic]

Interpretation From the above table and graph it says that majority of the respondents are willing (around 64%) to go to fast food retail outlet/s during the time slot of 6pm – 10pm which indicates that this time slot may be considered as peak hours for the outlets. 5. Expenditure per visit |  |sample of 20 |sample of 30 |sample of 50 | |Rs. 50-100 |5 |4 |9 | |Rs. 100-200 |4 |6 |10 | |Rs. 00-500 |10 |18 |28 | |above Rs. 500 |1 |2 |3 | |Total |20 |30 |50 | [pic] Interpretation From the above table and graph, we can infer that majority of the respondents are willing to spend money of price range 200-500 (i. e. 56%) and minority of them says that they will spend money of price range above 500 (i. e. 65%) in the fast food retail store. We can infer that the spending behavior is moderate. 6. Source of information   |sample of 20 |sample of 30 |sample of 50 | |Magazine |1 |1 |2 | |Internet |2 |1 |3 | |Television |7 |11 |18 | |Newspaper |3 |9 |12 | |Other |7 |8 |15 | |Total |20 |30 |50 | [pic] Interpretation From the above table and graph we can say that majority of the respondents (36%) of them get information about the fast food retail outlets through television. The other source of information respondents relay on word of mouth. Newspaper is acting as a source of information for students. 7. Compliment food with   |sample of 20 |sample of 30 |sample of 50 | |soft drink |14 |24 |38 | |tea, coffee |0 |4 |4 | |other |1 |0 |1 | |None |5 |2 |7 | |Total |20 |30 |50 | [pic] Interpretation Majority of the respondents are complimenting their food with soft drinks. We can also see a segment of respondents who do not compliment. 8. Eating behaviour   |sample of 20 |sample of 30 |sample of 50 | |eat at outlet |15 |27 |42 | |take home |5 |3 |8 | |Total |20 |30 |50 | [pic] Interpretation Majority of the respondents (84%) prefer to eat in the outlet itself which indicates to retail outlets should have proper seating arrangements to accommodate people properly. 9.

Likability attributes [pic] | |A |B |C | | | | | | |Pearson Chi-Square |18. 429 |12. 000 |0. 103 | |Coefficient |Value |ASE |Z |p-Value |95 % Confidence| | | | | | | |Interval | | |Phi |0. 784 | | | | | | |Lambda (Row Dependent) |0. 000 |0. 000 |0. 000 |0. 000 |0. 000 |0. 000 | |Lambda (Symmetric) |0. 67 |0. 158 |0. 421 |0. 674 |-0. 243 |0. 377 | |Uncertainty (Column Dependent) |0. 217 |0. 081 |2. 684 |0. 007 |0. 058 |0. 375 | |Uncertainty (Row Dependent) |0. 196 |0. 067 |2. 916 |0. 004 |0. 064 |0. 327 | |Uncertainty (Symmetric) |0. 206 |0. 073 |2. 834 | | | | | | |Pearson Chi-Square |14. 167 |12. 000 |0. 290 | Measures of Association for FREQUENCY and CATEGORY_PEOPLE |Coefficient |Value |ASE |Z |p-Value |95 % | | | | | | |Confide| | | | | | | |nce | | | | | | | |Interva| | | | | | | |l | | |Phi |0. 687 | | | | | | |Lambda (Row Dependent) |0. 222 |0. 120 |1. 852 |0. 064 |-0. 013 |0. 457 | |Lambda (Symmetric) |0. 174 |. |0. 000 |1. 000 |. |. |Uncertainty (Column Dependent) |0. 291 |0. 108 |2. 699 |0. 007 |0. 080 |0. 503 | |Uncertainty (Row Dependent) |0. 174 |0. 073 |2. 393 |0. 017 |0. 032 |0. 317 | Uncertainty (Symmetric) |0. 218 |0. 085 |2. 577 |0. 010 |0. 052 |0. 384 | | Association: There is an association between the frequencies of visits to the category of people with whom you will accompany. References: 1. Marketing research, by N. K. Malhotra, S. Dash. 2. The Art of Asking Questions, by S. L. Payne. 3. Basics Business Statistics: Concepts and Applications, by M. L. Berenson, T.

Krehbiel, D. M. Levine. 4. Introduction To Modern Non Parametric Statistics, by James J. Higgins 5. 100 Statistical Tests: New Edition, by Gopal K. Kanji. 6. http://www. ifama. org/tamu/iama/conferences/2004Conference/Papers/Richardson1004. pdf 7. http://www. radessays. com/viewpaper. php? nats=MTAxMzoyOjE,0,0,0,0&request=85233 8. http://www. ifama. org/library. asp? collection=2009_budapest&volume=symposium/1063_paper. pdf. ———————– Patronizing Fast Food Retail Sector-A Study TERM PAPER OF MARKET RESEARCH SUBMITTED BY G. BALAKRISHNA REDDY 09106 NAVYA SURPANENI 09127 SHASHANK A. 09144 SUJIN 09148 SWATI PARIKH 09150 VISHWANATH 09157 [Year]