Antara AsthanaBaibhav AgrawalDishika Agrawal

Presentation Layout

1. Introduction2. Founder3. Operational Model4. Target Market5. Market Coverage6. Funds7. The Drivers for

Railway Catering

8. Demand Driven Business Model

9. Competitive Advantage

10.Pricing Strategy11.Revenue12.Expansion 13.Challenges14.Strategic Models

Introduction

• Founded in 2012.• Travelkhana.com is a Delhi based online company.• Allows railway passengers to have their meals

delivered from specific restaurants in some cities across India to their seats on the train.

Founder

• The company was founded in 2012 by Pushpinder Singh.• Masters in Computer Science from BITS Pilani • B. Tech. from IIT - BHU, Varanasi.• TiE Entrepreneurial Excellence Award 2015

Operational Model

• Over Call, app or website• PNR number requested• App works offline as well• Choice of multiple suppliers

as well as an assorted menu• Online/ cash payment

optionsOrder

• Receives and confirms the order

• Prepares and packages the food as per standards

Supplier • Collects food from supplier• Responsible to deliver hot

food at the berth irrespective of the train arrival time

• 18-28% commission on every order

Travelkhana

• It offers a call centre interface, a web interface, and a mobile app interface to passengers.

• It gives the travelling passengers a list of restaurants along with their menu, through which the train passes.

• The responsibility for logistics is taken by the vendors.• The app works even in the offline mode. • Users can book their meal by providing their ‘Passenger Name

Record’ (PNR) number through calling, website or mobile app. • The company charges restaurants a commission of about 18–20

per cent on every order.

How It Works

Contd..

• Hot food is delivered to the travellers at their seats.• Payment can either be made online or when the food is delivered. • The food, which was initially delivered in the packaging provided by

restaurants, is now wrapped in packaging provided by TravelKhana.• Advantages claimed for customers include – greater choice– quality and hygiene– catering for special dietary requirements.

• Using GPS-enabled mobile applications, the service tracks the progress of trains in order to ensure that meals are delivered at the right time.

Target Market

• Over 2,00,00,000 of people travel in Indian railways.• Around 1,00,00,000 of them travel for long distances.• The company majorly focuses on those customers who travel

in sleeper class and do not have the facility of pantry cars.

Market Coverage

Its services expand to more than 6000 trains all over the country everyday

Has 1200 vendors at present.

Covers 500 railway stations as if now.

Claims to have served meals to 383,921 train passengers.

Funds

2012PERSONAL INVESTMENT OF RS 2.2 MILLION BY SINGH,

AND RS 3.5 MILLION FROM STARTUP INVESTOR MATTEO CHIAMPO

ANGEL FUNDS FOR ABOUT RS 120 MN FROM GOOGLE’S RAJAN ANANDAN, ALOK

MITTAL AND MORE

2015RAISED AROUND $1 MILLION FUNDING FROM

MUMBAI-BASED SEED FUND ASTARC VENTURES

The Drivers for Railway CateringPoor feedback of on-train catering services

Limited choice for passengers

Pantry cars only in selected trains

Poor hygiene in foods from station vendors

Ministry of Railways commercial circular opening up avenues to food delivery/ Restaurant aggregators to deliver food in trains at selected station

Demand Driven Business Model

Passengers

Travelkhana

Competitors

• YatraChef

•Travelthali

•Khanaonline

•Travelerfood •TravelZaika.

Competitive Advantage

Largest reach in terms of stations.

Has 1200 vendors with it at present.

Strong relationship with Indian Railways (tied up with IRCTC in 2014).

Month on month growth of 18-20%.

Pricing Strategy

The pricing strategy adopted by Travelkhana is Market penetration whereby:

• The prices are driven by the suppliers on the basis of competition.

• Pricing advantage upto 50% over conventional caterers (the pantry cars) of trains.

Revenue

• Travelkhana generated a revenue of Rs 6.54 crores in 2014-15.

• It expects it to increase threefold by the end of 2016.

• It expects it to increase foothold by the end 2017.

• Looking for new avenues such as meals in buses and airport.

• It delivers the specialties of the place, like peda at Mathura station, ghevars and kachodis at Rajasthan stations and many more.

Expansion

Challenges

• On Time Every Time (Indian Railway).• Serving hot meal.• Expansion.•Stakeholder Management (Vast network of restaurants). •Focused customer acquisition•Training the vendors with the process•Operations & logistics management •Raising funds

IRCTC, Station Stalls, Carts

and Canteens YatraChef, TravelThali

New Entrants

Indian Railway

Passengers

Home Cooked Food,

Hawkers

Suppliers(Restaurants

)

PORTER’S FIVE

FORCES MODEL

• Suppliers :- The suppliers of the consists of the restaurants who supply the meals as per the order of the customers. These suppliers have considerable bargaining power as they are in large numbers. At the same time their source of revenue doesn't not solely depend upon the catering to railway travelers, so the terms of the deal depend upon the suppliers to a large extent.

• New entrants:- the existing restaurant chains, websites like food panda can be considered the new entrants for the industry.

• Substitutes:- the travelers may prefer to carry along with them the home cooked food while they head for a journey by railways. Hawkers on stations cant act as a substitute whereby the traveler may prefer to purchase the food on spot rather than going for an extensive order placement through travelkhana.

• Buyers:- they have bargaining power in terms of a number substitutes and the existing competition.

• Existing competition:- IRCTC, Yatrachef, Travel thali are the eisting competition in the industry.

Contd..

IT Infrastructure

Inbound Logistics-Procuring

food packets form

Restaurants

Business Development, Marketing and

Sales

On call assistance to customers - such as product information,Payment modes

Outbound Logistics-

Delivering food packets to

customers in trains

Procuring Financial Investment

Human Resource

Business contracts and Alliances

VALUE CHAIN ANALYSIS

Primary Activities

(i) Inbound logistics: For TravelKhana inbound logistics consist of procuring the food materials from various restaurants in the city of its operations. These restaurants are the one who are responsible for taking orders and delivering the same to customers.

(ii) Outbound logistics: The movement of the products from the producers to ultimate consumers is termed as outbound logistics. For TravelKhana the delivery of the ordered cuisine to the customers at the railway station on his berth is outbound logistics. TravelKhana acts as a mediator and a delivery mechanism wherein the delivery boy collects the order form the vendor and delivers it to the customer.

(iii)Marketing: Another important primary activity of the company is to promote and advertise itself. From the five forces model we have seen that the lack of awareness among the Indian consumers(travelers) is a threat for the company, so large scale advertisement and promotion are required. At the same time in order to cater to the diverse customer base in tier 2 and tier 3 cities TravelKhana is required to have a successful business development program.

(iv)Services: For TravelKhana service part of the primary activity is very important aspect. It works as an aggregator so at times the consumers may not understand the tools available on its website or the mobile application. Service is required in terms of on call assistance to customers regarding the variety of menu and the modes through which payment has to be made.

Secondary Activities

 (i) IT Infrastructure: TravelKhana works as an aggregator. Internet infrastructure as well as availability of smart

phone devices is a secondary activity though it is vital for the growth of the organization. It infrastructure is a major component for TravelKhana to reach to its ultimate goal.

(ii) Procuring Financial Investment: for the company procurement as a secondary activity is quite different. Procurement in general value chain analysis refers to the procurement of raw materials and other major aspects of production. In TravelKhana there is no actual production so procurement majorly consists of procurement of financial resources. These resources are required to collaborate with greater number of restaurants in multiple cities as well huge advertisements and promotions are also required.

(iii)Human resource: Human resource is a vital aspect of any organization. The company requires efficient manpower to establish good relations with the local restaurant owners for the supply of food items and delivery of the same.

(iv)Business Contracts and Alliances: This part comes under the infrastructure aspect of value chain analysis. Collaborations with local restaurants and vendors is very important for the organization. The stronger the network of the company in terms of restaurants, the stronger will be the firms’ infrastructure.

• Passengers’s distrust of railway catering• Passengers carrying home cooked food• New Startup culture • Next generation educated set of

passengers

• Government push on Startup India• Improved credit mechanism• GDP growth of 7.5%

SOCIAL ECONOMIC

TECHNOLOGYPOLITICAL

• Railways has always been used as a vote attracting ministry

• Railway Minister has specifically focused on improving quality of service in 2016 Rail Budget

• Passengers’s distrust of railway catering• Passengers carrying home cooked food• New Startup culture • Next generation educated set of

passengers

PEST ANALYSIS

Political:

Railways: The railway policies are highly influenced by politics. So the policies are focused towards the convenience to the citizens as this is what directly influences the votes. So the present government has tried to collaborate with the private sector for improvement in quality. Thus tavelkhana has tapped this segment with hygienic food. 

Rail budget 2016: Rail budget 2016 has special focus on improvement of quality and therefore this is a good opportunity for TravelKhana and therefore the licensing and other legal procedures were not so stringent and thus it made it easy for TravelKhana to enter into the market. These factors may also create other opportunities. 

Startup India: The BJP government has initiated the movement “Startup India” for promoting the startups in India so that the youth can easily implement their new business ideas, the country will be able to suffice its needs which means lesser imports and also the employment opportunities can be created. So, tax exemptions and subsidies on certain resources are provided to promote startups. So this is again a favorable

This shows that the political factors are favorable to the company.

Economic:

Improved credit mechanism: The government is trying to include more and more number of people under the banking system and therefore a lot of people now have the facility of net banking and debit/credit card so multiple payment options are available. This is convenient for the company as well as for the travelers.

GDP growth of 7.5%: Indian economy has grown and there is a growth of 7.5% in GDP. It means the people have an increase in their disposable income and so the demand for the services by TravelKhana is likely to increase. 

The economic conditions are also favorable to the company but because these factors are all pervasive therefore it is beneficial for the competitors also and thus the competition is increasing which may cannibalize the market share of existing firms.

Social:

Passengers’s distrust of railway catering: The passengers often complain about the quality of food served by the pantry. The cleanliness, freshness and overall hygiene is not always maintained and so they sometimes try to avoid the food catered by them. TravelKhana ensures good quality food served hot at the berth of the passengers.

Passengers carrying home cooked food: The Indian society is still skeptic about consuming readymade food because of their cultural norms. So they prefer to carry home cooked food while travelling as it is cheap, fresh and hygienic. So this is a challenge to the company and there is a need to change the perception of the consumers by making them learn about the benefits that they will get.

New Startup culture: The startup culture is trending in India which has made the youth innovative enough to try out new things and thus the innovative and relevant business ideas are easily accepted by them. This is beneficial for the company. But this aspect acts like a double edged sword for the company because it becomes difficult for the company to differentiate itself from the rest of the players and also to make everyone aware about it.

Next generation educated set of passengers: The literacy rate has increased and also the people are educated enough to understand the usage of technology; smartphones in this case. This makes it easy for the people to use the app conveniently and they also understand the utility of the services offered by the company.

So, it can be said that the social factor is favorable to some extent for the company but there still remains a lot of scope to overcome some of its unfavorable factors.

Technological:

Improved IT Infrastructure: The IT infrastructure has improved over the years, specifically at railway stations. The need for IT is required for this business and as it has improved so the company is benefitted. 

Smart phone proliferation: The users of smartphone are increasing rapidly and this is why the company has launched an app to cater to its targeted segment. So it means the company has rightly identified the opportunity and may succeed if it formulates the right strategy.

So, the technological factors are also in support of the company.

It can be deduced from the PEST analysis that the political and technological factors are in favor of the company and the social and economic factors are somewhat unfavorable for the company. It means that the company can has to overcome its weak areas while the favorable factors are needed to be maintained and even improved.

• Conventional suppliers (hawkers)• Delays in trains arrival

• Vast network causing operational challenges• Lack of awareness• Funding challenges

STRENGHTS WEAKNESSES

THREATSOPPORTUNITIES• Ever growing number of passengers looking for

variety• Unhygienic food provided by conventional caterers • Increase in number of Smartphone users• Targeting bus and air passengers too• Revenue from suppliers’ promotion• Attractive to vendors

• First mover advantage• App works in offline mode• Offer specialties of places• Convenient payment options• Vast network• Pricing advantage

SWOT ANALYSIS

Strengths

(i) First mover advantage: As this company is the first of its kind, it availed the advantage of having the monopoly in this industry. People were attracted to the company due to the unique services offered and it catered to a totally untapped segment in the market and created a new market.

(ii) App works in offline mode: There exists a huge problem of network connectivity while travelling and thus, this differentiating feature where by the user of the app orders the food through this app, an sms is sent and no internet connection is required.

(iii)Offer specialties of places: The company offers delivery of special food items of various cities, like Peda at Mathura, Ghevar and Kachodi at Jaipur, Kesar Petha at Agra. This again is a unique value proposition for the travelers whereby they don’t have to visit the city to have the special delights.

(iv)Convenient payment options: The app provides convenient payment options. The online payment through credit/debit cards and internet banking are secured and yet for the skeptic travelers the cash on delivery option is also available. Due to monetization the company is now looking forward to other options also so as to provide convenience in payment.

(v) Vast network: Its services expand to more than 6000 trains all over the country every day. It has 1200 vendors at present and covers around 500 railway stations as of now. It claims to have served meals to 383,921 train passengers.

(vi)Pricing advantage: It offers a good value for money. The prices are equivalent or even lesser at times as compared to IRCTC and it also emphasizes on the hygiene factor which is not there in case of IRCTC.

Weaknesses

(i) Vast network causing operational challenges: Although the vast network is strength but this is also a weakness for the company. Managing a vast network effectively and simultaneously maintaining the standards is a great challenge for the company.

(ii) Lack of awareness: The users on Indian Railways mostly consist of the lower middle income and lower strata of the Indian economy who do not have sufficient knowledge to use such a technical tool. The awareness regarding the company among the literate masses is not sufficient. Heavy investment in advertisements has to be made in order to increase awareness.

(iii)Funding challenges: TravelKhana is not a listed company in the India Stock markets. In order to grow and improve the outreach of the network greater investment is required, sourcing huge funds serve s as weakness for the economy.

Opportunities

(i) Ever growing number of passengers looking for variety: The number of Indian Railway Passengers is increasing exponentially. The market base for the company is widening as more and more people are digitally aware.

(ii) Unhygienic food provided by conventional caterers: The competitors of company such as IRCTC and the local hawkers might not provide hygienic food. This acts as an additional disadvantage. Health conscious consumers are attracted to the company.

(iii)Targeting bus and air passengers too: The company is now looking on to expand its operations to roadways and airways also.

(iv)Revenue from suppliers’ promotion: The company promotes the vendors’ businesses which encourage them to collaborate with TravelKhana and thus it is benefitted ultimately. Thus the revenue increases.

Threats

i) Competitors: Although it had the first mover advantage but this industry is highly attractive to the new entrants and therefore several other players entered the industry and the competition is increasing continuously.

ii) Conventional suppliers (hawkers): the local hawkers at railway stations as well as the local meal suppliers act as a threat for the industry.

iii) Delays in trains arrival: the company works on the principle of providing food at the birth of the customers on arrival of the train. Delay in trains causes incontinence in providing hot meals to the travelers and at the same time TravelKhana has to keep continuous track of various trains.