Escolar Documentos
Profissional Documentos
Cultura Documentos
GROUP 5
ANANTHAKRISHNAN S
(1311077)
DHIVYA LAKSHMAN
(1311086)
KARTHIK ARUMUGHAM
(1311299)
MANISH KUMAR
(1311305)
SHANTHA KUMAR T
(1311402)
Table of Contents
Introduction ................................................................................................................................................. 2
Au Bon Pain in India .................................................................................................................................. 3
Competition ................................................................................................................................................. 4
Marketing .................................................................................................................................................... 4
Supply Chain ............................................................................................................................................... 5
Au Bon Pain - IIMB outlet ......................................................................................................................... 6
Day to Day Operations ............................................................................................................................... 6
Forecasting............................................................................................................................................... 6
In-Bound Logistics ...................................................................................................................................... 7
Manufacturing & Sourcing ........................................................................................................................ 8
Data collection & sharing across Au Bon Pain outlets ............................................................................ 8
Layout of the stores..................................................................................................................................... 9
Recommendations ..................................................................................................................................... 10
List of Exhibits .......................................................................................................................................... 11
Exhibit 1: List of Au Bon Pain Outlets in Bangalore with distance from DC ........................................ 11
Exhibit 2: Au Bon Pain Outlet locations in Bangalore ........................................................................... 12
Exhibit 3: Caf spread across major cities in India ................................................................................. 13
Exhibit 4: Typical Advertisements by Au Bon Pain ............................................................................... 14
Exhibit 5: Production Facility at Yeshwantpur (Au Bon Pain Caf India Ltd.) ..................................... 16
Exhibit 6: Au Bon Pain Outlet Layout in Bangalore .............................................................................. 17
Exhibit 7: Arrangement of food items in a typical Au Bon Pain ............................................................ 18
Exhibit 8: Optimal route from DC to IIMB Au Bon Pain outlet ............................................................ 19
Exhibit 9: Typical sales data and Transfer statement of Au Bon Pain.................................................... 20
Introduction
Au Bon Pain is a fast casual bakery and cafe chain headquartered in Boston, Massachusetts. The
first Au Bon Pain was opened in Boston in 1978. Now, it has emerged as one of the best-loved
caf bakery chains in the world with over 385 cafes worldwide (United States, India, and
Thailand). They are generally located on some of the most visible corners and crossroads, in
urban buildings, college campuses, transportation centers, shopping malls, museums and
hospitals.
While most of their stores in United States are company-owned, international locations are
typically franchised. India is one such location. The Au Bon Pain Cafe India Ltd is a 80:20 JV
between Spencer's and Varin Narula. Au Bon Pain entered India through a master franchise deal
with Spencer Retail Ltd. owned by RP-Sanjiv Goenka Group. The chain in India focuses on
serving a build-it yourself range and assortment of breakfast, lunch and dinner items along with
coffee, baked goods, confectionaries, soup, salads, sandwiches, harvest rice bowls, and also hot
and cold beverages. The menu is usually limited to an extended over-counter display, and
options in the way the food is prepared is emphasized. Au Bon Pain is known for serving healthy
food with hygienic conditions. Now, health-conscious items form a large portion of the menu.
The accent is on freshness, quality ingredients and wholesome offerings. The rates are on par
with competition and average meal for two would cost around Rs. 220-250.
"Fast casual restaurants" would meet the following criteria:
Au Bon Pain is looking forward to open cafs in locations that have a significant customer
population, and in some areas with huge potential for sales such as urban markets, hospital cafes,
transportation center cafes, college campus cafes and shopping mall cafes. The size of an
average store ranges from 850 sq. ft. to 1,800 sq. ft.
Competition
With caf parlors becoming more accepted and adopted, Au Bon Pain has a bigger market as
well as serious contenders to their precious customers. Few of its competitors are given below.
The competitor outlets according to cites is shown in Exhibit 3.
Cafe Coffee Day (CCD): Caf Coffee Day, popularly known as the CCD, is the most popular &
loved coffee shop and is also the largest chain of coffee cafes in India. CCD started operations in
1996 in Bangalore. It grew rapidly and attracted coffee lovers of all the age groups. The quality
and taste of the CCDs coffees along with the interiors and the hospitality were the key factor to
ignite the fame. It has more than 1300 outlets across the twenty-eight states in India, and is
expecting to have 2000 outlets by the end of 2014.
Barista Lavazza: Barista opened its first coffee lounge in 2000 at Delhi. Since then, it has been
called as one of the best espresso bars in India. At present, Barista Lavazza has more than 225
outlets in India.
Costa Coffee: Costa Coffee, the largest British chain and the second largest coffeehouse in the
world, made its way to India in September 2005. At present, it has over 100 outlets across cities
of Bangalore, Delhi, Mumbai, Gurgaon, Noida, Jaipur and Agra.
Tata Starbucks: Starbucks made its way to India in the year 2011, after entering into a
partnership with Tata Coffee and opened its first store in 2012. Starbucks serves delicious
flavors of coffee in every country it operates in. Along with hot and cold varieties of coffee,
Starbucks also serves full-leaf teas, pastries, snacks, packaged foods and sandwiches. It also sells
coffee mugs and tumblers. At present, Starbucks operates 34 outlets in 5 cities of India (Delhi,
Gurgaon, Mumbai, Pune and Bangalore).
Marketing
Au Bon Pain with its presence only in Bangalore and Kolkata has reached entire India by, using
the power of the ripple effect through social media. They looked to establish its brand image
through Public Relations. By engaging with activities, campaigns and off-beat offers and inviting
people to narrate their experience, the Facebook page become a story-telling brand site for Au
Bon Pain in India. In fact, the Facebook page was created prior to the opening of the first caf
and was used as a tool to share teaser messages at the launch. The member base continues to
increase week by week a result of a sustained, effective and insights-driven social media
campaign. Au Bon Pain is now a niche brand committed to quality of the food, nutrition, healthrelated information, menu choices, which in its entirety will deliver an enhanced customer
experience. Few of their advertisements are shown in Exhibit 4.
Supply Chain
The supply chain and the value chain of a typical Au Bon Pain is shown below.
Forecasting
The huge number of SKUs makes it difficult to forecast the demand and thus the appropriate
production. As the over stocking and under stocking costs are both high for a caf bakery like Au
Bon Pain, the manager has to place the order every day. This forecasting is done by each store
manager on a daily basis depending on the sales data of the corresponding day of the past 3
weeks.
An example for the ordering procedure: To order for Monday, the store manager computes the
average sales for each item with the sales data of the last three Mondays on the previous evening
at around 3pm and make necessary adjustments depending on the seasonality, special occasions
and his experience. The sales are highly variable with the maximum sales on weekends
(Saturday and Sunday).
Most of the customers (around 80%)) are students and the rest belong to family members,
visitors and IIMB staff. The average daily sales of Au Bon Pain is around Rs 15,000 (after
discount) on a normal day.
At the end of the day as a means to reduce the over-stocking costs Au Bon Pain uses sales
gimmicks such as buy one get one free two hours before the closing time. (This is not used in
IIMB due to the heavy discounted price). The rest of the unsold items are discarded on the
expiration of shelf life.
Staff Training for day to day operations
An average outlet is run by 8 members during peak days (or hours) and 6 members during
normal time. This ensures that the customers get the promised Au Bon Pain experience.
For this purpose the staff are trained at an aggregate level starting from the Store Manager who
then trains the staff. Extensive training is required as most of the staff dont have any Hotel
Management experience or certifications.
In-Bound Logistics
All the required items for daily operations of the IIMB outlet are transported from Au Bon Pain
Production and Central Distribution center at Yeshwantpur, Bangalore. All the perishable items
are delivered daily and the other nonperishable items (sugar packets, napkins, plastic items) are
delivered on a weekly basis. All the perishable items are delivered in a chiller vehicle at a
temperate below 5 C to prevent spoilage.
The delivery van leaves Yeshwantpur DC around 4:00 - 4:15 am and reaches the IIMB outlet
around 5:00 - 5:15 am. The goods are transferred into the store after manual checking by an
employee by checking against the indenting document called Delivery Channel. A typical
Deliver channel along with Transfer statement is shown in Exhibit 9. This checking takes
around 15 minutes.
All the logistics required by Au Bon Pain is taken care by third party logistics, payment is done
based on the kilometers covered at the cost of around Rs. 14/km. The logistics service to IIMB is
done through SLN Tempo Services. A single delivery van on an average covers 4 -5 outlets for
delivery. Thus 4 vans would cover entire Bangalore. In this way ABP achieves economies of
scale.
The route taken for delivery to IIMB is Yeshwantpur DC EGL outlet Koramangala Outlet
IIMB outlet Fortis Hospital outlet Back to Yeshwantpur DC.
The optimal route to IIMB based on shortest distance is shown in Exhibit 8.
Enable control of remotely located outlets from a central head office and consolidation of
data, which is automated at time of day end.
ShawMan MMS (Material management system): Allows Au Bon Pain to manage its supply
chain activities efficiently. This manages various tasks such as indenting, receiving and finally
tracking items consumption from finished good. This supports multi-location operations such as
central warehouse and outlets for the semi and finished goods movement. This has an interface
with the POS.
ShawMan MMS auto Generates Document Number, Supplier and Raw Material codes. It links
raw materials to multiple stores and provides online information of Items in Stock at any point
of time. It manages materials movement between multiple vendors, warehouses and outlets. Inter
outlet and inter store transfer of semi-finished and finished goods is also monitored. This is done
using Secured User Login Ids and passwords created for the store manager.
A typical sales data of a single day collected through Shawman software is shown in Exhibit 9.
Recommendations
1. Route optimization of the delivery vans will reduce travel time and reduce costs. GPS
location data can be used to track trucks get the optimal route, it also improves fuel
efficiency. The increasing number of Au Bon Pain stores will reduce the need of delivery
van per outlet and can help improve profits.
2. At present if a stock out occurs, the store manager has to physically call each store nearby
to order any needed ingredients, this is inefficient and takes time. This can be done more
efficiently by using a centralized IT system.
3. Au Bon Pain has many items which can be handpicked by the customers themselves, this
causes some theft. This reduces profit and is also difficult to monitor. A way to handle
this can be the use of CCTV.
4. Continuous product innovation is a major challenge for a bakery caf like Au Bon Pain.
With the presence of well-established players like CCD, Au Bon Pain has to offer
different and new innovative items to the highly demanding customer. The competition
from chains like McDonalds and KFC is a serious threat.
5. Sales staff have to be trained in menu, suggestive selling and up-selling.
6. Au Bon Pain has to open more stores as to achieve greater economies of scale and
bargaining power with their suppliers. The plan to reach a target of 100 stores in
Bangalore has to be worked out in a swift manner.
List of Exhibits
Outlet Locations
Bellandur (Accenture BDC-4)
Bellandur (Accenture BDC-7)
Bellandur (RMZ Ecospace)
Jayanagar (Cloudnine Hospitals)
Malleshwaram (Mantri Square)
Old Madras Road (Google)
Ulsoor (RMZ Millenia)
Whitefield (Accenture BDC-6)
Kalinga Rao Road (HCG Hospital)
Cunningham Road
Richards Town
Old Madras Road (RMZ Infinity)
Brigade Road (EVA Mall)
Indira Nagar
Koramangala
HRBR Layout
Banaswadi (ITC Infopark Ltd.)
Domlur (EGL)
Old Airport Road (Cloudnine Hospitals)
Banerghatta Road (Fortis Hospitals)
Malleshwaram (Cloudnine Hospitals)
Whitefield (ITPL)
IIM Bangalore
Jayanagar (Cloudnine Kids Hospitals)
BIAL
VFS
Wipro
Narayana Hrudyalaya
Indira Nagar
CCD Barista
Mumbai
15
192
19
Delhi
13
180
19
Bangalore
29
241
29
Kolkata
73
13
Chennai
84
Pune
73
Exhibit 5: Production Facility at Yeshwantpur (Au Bon Pain Caf India Ltd.)
VFS Outlet
BIAL
Mantri Square
Legend
Onward Trip
Return Trip
Longitude
Latitude
Distance (km)
77.551463
13.019948
77.644348
12.949187
18.82
77.626675
12.937633
4.52
77.60278
12.895521
10.14
77.599031
12.895075
1.19
77.551463
13.019948
18.76
References:
http://retail.economictimes.indiatimes.com/news/food-entertainment/food-services/goenkaplans-to-take-au-bon-chain-national-by-march/27560741
http://aubonpain.com/
https://www.facebook.com/AuBonPainPageIndia
http://en.wikipedia.org/wiki/Au_Bon_Pain
http://www.spencersretail.com/au-bon-pain.php
http://www.indiasocial.in/case-study-au-bon-pain-food-is-just-not-enough-we-want-more/
http://www.business-standard.com/article/companies/goenka-plans-rs-70-crore-au-bon-painexpansion-113122300541_1.html
http://www.shawmansoftware.com/