Jaipuria Institute of Management,Vineet Khand, Gomti Nagar

Lucknow – 226 010

Academic Year 2015-16

Batch 2014-16

Trimester 5th

Programme

(PGDM / PGDM-FS / PGDM-RM)

PGDM, PGDM-FS

Name of Course Customer Relationship Management

Section A

Name of Faculty Dr. Reeti Agarwal

Nature of submission(Assignment / Project Report)

Project Report

Topic of Assignment / Project CRM Practices in a restaurant industry

Deadline for submission December 24, 2015

Group/ Learning Team Number 9

Submitted by:

Sl. No.

Name of Student Enrollment No. Signature

1 Nikita Srivastava JL14FS23

2. Raj Vardhan Singh JL14PGDM195

3. Ashraf Asif Siddiqui JL14PGDM196

4. Shubhankar Vaish JL14PGDM

5. Abhishek Tewary JL14PGDM

6. Sankalp Bajpai JL14PGDM

Date of receiving at PMC Signature of PMC staff

TABLE OF CONTENTS

CHAPTER 1

(a) MEANING AND IMPORTANCE OF CRM

Customer relationship management (CRM) is a term that refers to practices, strategies and technologies that companies use to manage and analyze customer interactions and data throughout the customer lifecycle, with the goal of improving business relationships with customers, assisting in customer retention and driving sales growth. CRM systems are designed to compile information on customers across different channels -- or points of contact between the customer and the company -- which could include the company's website, telephone, live chat, direct mail, marketing materials and social media. CRM systems can also give customer-facing staff detailed information on customers' personal information, purchase history, buying preferences and concerns.

Looking at some broader perspectives given as below we can easily determine why a CRM System is always important for an organization.

1. A CRM system consists of a historical view and analysis of all the acquired or to be acquired customers. This helps in reduced searching and correlating customers and to foresee customer needs effectively and increase business.

2. CRM contains each and every bit of details of a customer, hence it is very easy for track a customer accordingly and can be used to determine which customer can be profitable and which not.

3. In CRM system, customers are grouped according to different aspects according to the type of business they do or according to physical location and are allocated to different customer managers often called as account managers. This helps in focusing and concentrating on each and every customer separately.

4. A CRM system is not only used to deal with the existing customers but is also useful in acquiring new customers. The process first starts with identifying a customer and maintaining all the corresponding details into the CRM system which is also called an ‘Opportunity of Business’. The Sales and Field representatives then try getting business out of these customers by sophistically following up with them and converting them into a winning deal. All this is very easily and efficiently done by an integrated CRM system.

5. The strongest aspect of Customer Relationship Management is that it is very cost-effective. The advantage of decently implemented CRM system is that there is very less need of paper and manual work which requires lesser staff to manage and lesser resources to deal with. The technologies used in implementing a CRM system are also very cheap and smooth as compared to the traditional way of business.

6. All the details in CRM system is kept centralized which is available anytime on fingertips. This reduces the process time and increases productivity.

7. Efficiently dealing with all the customers and providing them what they actually need increases the customer satisfaction. This increases the chance of getting more business which ultimately enhances turnover and profit.

8. If the customer is satisfied they will always be loyal to you and will remain in business forever resulting in increasing customer base and ultimately enhancing net growth of business.

CHAPTER 2

(a) INTRODUCTION TO INDUSTRY

Restaurant companies are essentially retailers of prepared foods, and their operating performance is influenced by many of the same factors that affect traditional retail stores. For the most part, restaurants have business models that are relatively easy to understand, and the array on the Value Line page is the same as that of a standard industrial company. Nonetheless, there are a number of unique factors to consider when making investment decisions regarding this large and segmented industry.Competition between restaurants is intense, since dining options abound. And, while there are certainly dominant players in this industry (especially among fast-food purveyors), no one company has the market cornered. Indeed, virtually every restaurant location must compete not only against other publicly traded chains, but also a wide array of small, local establishments. Competitors include everything from delis and pizzerias to fine-dining restaurants. And, of course, it is relatively easy to forgo prepared foods, altogether, in favor of home cooking, which is usually a less expensive option. Thus, restaurant meals are discretionary purchases, and the industry tends to be highly cyclical.

Restaurants may be classified or distinguished in many different ways. The primary factors are usually the food itself (e.g. vegetarian, seafood, steak); the cuisine (e.g. Italian, Chinese, Japanese, Indian, French, Mexican, Thai) and/or the style of offering (e.g. tapas bar, a sushi train, a tastet restaurant, a buffet restaurant or a yum cha restaurant). Beyond this, restaurants may differentiate themselves on factors including speed (see fast food), formality, location, cost, service, or novelty themes (such as automated restaurants).Restaurants range from inexpensive and informal lunching or dining places catering to people working nearby, with simple food served in simple settings at low prices, to expensive

establishments serving refined food and fine wines in a formal setting. In the former case, customers usually wear casual clothing. In the latter case, depending on culture and local traditions, customers might wear semi-casual, semi-formal or formal wear. Typically, customers sit at tables; their orders are taken by a waiter, who brings the food when it is ready. After eating, the customers then pay the bill.

(b) NEED FOR CRM IN A RETAURANT INDUSTRY:

It’s a busy night in your restaurant -all the tables are booked and more customers are lined up while waiters are occupied serving meals and clearing tables. The kitchen is firing on all cylinders. Managers are working the floor making sure things are running smoothly. At the end of the night, the coffers have been nicely filled, waitrons have earned great tips and happy satisfied customers have strolled out the door. It was a good night for business.

But, how do you keep the momentum going and have more profitable nights like this with a constant stream of customers? How do you ensure those satisfied customers eat at your restaurant regularly?

Let’s face it, the restaurant industry is tough. There is some debate on the statistics, but, it is estimated that between 60 – 80% of new restaurants fail within the first year. Around 70% of those that make it past the first year are likely to close their doors within the next three to five years. These are scary statistics for restaurant owners. For those that do last, life is still not easy - competition is around every corner. Customers are spoilt for choice. How do you get a leg up to help you stand out above the crowd that are all clambering to get their feet through the door?

Relationship building is key; it can make the difference between a one-time customer and those that return on a regular basis. These days there are plenty of CRM solutions out there that cater specifically to the restaurant industry and have changed the game significantly in this highly competitive arena.

5 ways a restaurant's CRM initiative can turnaround customer churn:1. Build a customer databaseThe first thing a CRM system does is gather information and help the restaurant owner get to know their customer.

1. Customer contact details2. Frequency of visits3. Preferences on meals4. Average spend per visit

when linked to the restaurant’s point of sale software, it can provide valuable reports and analysis on-

1. Most popular menu items2. Items that are not selling3. Busiest days/ nights and help identify the reasons why4. If it is a nationally franchised or chain of restaurants, it can provide the franchisor with information on which regions are performing better than others.

This becomes the basis for communication with the customer, helps track customer trends and feeds into marketing plans.

CHAPTER 3

(a) INTRODUCTION TO MCDONALDS

McDonald's is the world's largest chain of hamburger fast food restaurants, serving around 68 million customers daily in 119 countries across more than 36,000 outlets. Founded in the United States in 1940, the company began as a barbecue restaurant operated by Richard and Maurice McDonald. In 1948, they reorganized their business as a hamburger stand using production line principles. Businessman Ray Kroc joined the company as a franchise agent in 1955. He subsequently purchased the chain from the McDonald brothers and oversaw its worldwide growth.

A McDonald's restaurant is operated by a franchisee, an affiliate, or the corporation itself. The McDonald's Corporation revenues come from the rent, royalties, and fees paid by the franchisees, as well as sales in company-operated restaurants. In 2012, the company had annual revenues of $27.5 billion and profits of $5.5 billion. According to a 2012 BBC report, McDonald's is the world's second largest private employer—behind Walmart—with 1.9 million employees, 1.5 million of whom work for franchises.

McDonald's primarily sells hamburgers, cheeseburgers, chicken, French fries, breakfast items, soft drinks, milkshakes, and desserts. In response to changing consumer tastes, the company has expanded its menu to include salads, fish, wraps, smoothies, fruit, and seasoned fries.

(b) INTRODUCTION TO GINGER RESTAURANT

Ginger is an Indian hotel chain, established by Roots Corporation Limited, and part of the Tata Group, a new brand under a category called "Smart Basics Hotels". The first hotel was opened in Whitefield, Bangalore in June, 2004. Roots Corporation Limited is a fully owned subsidiary of The Indian Hotels Company Limited (IHCL). IHCL, part of the Tata Group is India’s largest hotel chain with more than 70 properties in India and abroad and over 100 years' presence in India’s hospitality sector. It initially charged ₹ 999 per night in 2004. Today it charges range from ₹ 2999-3499 plus taxes per night.

CHAPTER 4

(a) CRM PRACTICES IN MCDONALDS