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Internship Report An Organizational Study At COFFEE DAY XPRESS BANGALORE Submitted in partial fulfillment of the requirement of the Bangalore University for the forward of degree in
Master of Business Administration Submitted by DINESH KUMAR KARNAM REGISTRATION NUMBER- 10XQCMA032 Under the guidance of PROF. VIJAYALAKSHMI S
I, Dinesh Kumar Karnam (Reg. No - 10XQCMA032) hereby declare that the Internship Report, an organizational study conducted at COFFEE DAY XPRESS, Bangalore submitted in partial fulfillment of the requirement of the Bangalore University for the award of degree in Master of Business Administration, is a bonafide work carried out by me under the guidance of Prof Vijayalakshmi S, MPBIM, Bangalore. This report has not been submitted earlier to any other university or institution for the award of any degree/ diploma. The contents of this report are based on the data collected by me at COFFEE DAY XPRESS, Bangalore under the guidance of Major (Retd.) Allwyn Roshan D Souza, Manager (SCM).
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Me, the undersigned IInd semester student of MBA, M P Birla Institute of Management, Bangalore, is glad to express my deep sense of gratitude to all those people connected with the successful completion of this organizational study. This report is obviously not the result of my work alone. Many persons are directly or indirectly involved, without whom this work would not have been completed. I am grateful to Mrs. Vijayashree Gilganchi for giving me an opportunity to do my training and organizational study in COFEE DAY XPRESS, Bangalore. I am thankful to my external guide Major (Retd.) Allwyn Roshan D Souza, Manager (SCM) for his guidance and support. I am also thankful to my faculty guide Prof. Vijayalakshmi S, MPBIM for her guidance and support. I would also like to express my sincere gratitude to my Principal Dr N. S. Malavalli for all the support provided.
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1.4 Company Divisions 1.5 About Coffee Day Xpress 1.6 Vision, Mission and Objectives ORGANIZATIONAL STRUCTURE: 2.1 Corporate Organizational Structure 2.2 Department Organization Structure 2.3 Authority and Responsibility Relationship
29 30 52 54 55 56
2.4 Business Cycle 2.5 Rebranding of Coffee Day Xpress 2.6 Business Model of Outlets at CDX CORE STUDY AREA - S C M 3.1 What is Value Chain 3.2 SCM Process
60 63 69 70 71 72
3.3 Hierarchy 3.4 SCM Structure 3.5 Vendor Specifications 3.6 Product Category SWOT ANALYSIS:
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4.1 Strengths and Weakness 4.2 Opportunities and Threats FINDINGS, SUGGESTIONS & CONCLUSIONS BIBLIOGRAPHY
79 82 86 89
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CHAPTER 1
INTRODUCTION
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In the year 2003, ABCTCL came up with a new concept to bridge the gap between the leisurely coffee experiences that Caf Coffee Day provides and that of serving a quick cuppa from a vending point, to offer the very best in every segment for the diverse Coffee Day patrons, and this concept was called Coffee Day Xpress an idea that feeds a world that is in transit.
Coffee day Xpress is a unique concept of convenient caf. The CDX kiosk is a sanctuary where the harried urbanite can pause for refreshment before getting on with life. Retail, custom - made for the 21st century. Catering to a world that needs a coffee on the go, especially at high traffic locations, with hot and cold beverages and a variety of ready-to-eat snacks.
It is a unique food retailing concept addressed to provide fast, hygienic, convenient-to-eat and affordable food & beverages. With its speed of service, convenient location, freshness, superior quality of coffee, high hygienic standards and affordability. Xpress has quickly reached more than 900 outlets over 20 cities and plans 1000 franchises by the year 2010.
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Accordingly to the story, the effect of coffee beans on behaviour was noticed by a sheep herder from Caffa. Ethiopian named Khalid as he tended his sheep. He noticed that the sheeps became hyperactive after eating the red cherries from a certain plant when they changed the pastures. He tried a few and was soon overactive as his herd. The story relates that a monk happened to pass by and scolded him for partaking the devils fruit. However the monks soon discovered that these fruit from the shiny green plant could help them stay awake for their prayers.
Originally the coffee plant grew naturally in Ethiopia, but once transplanted in Arabia was monopolized by them. Earlier use of coffee would have little appeal than today. The Galla tribe from Ethiopia used coffee, but not as beverage drink. They would wrap the beans in animal fat as their only source of nutrition on raiding parties. The Turks were the first country to adopt it as a drink, often adding spices such as clove, cinnamon, cardamom and anise to the brew.
Coffee was introduced much later to the other countries beyond Arabia whose inhabitants believed it to be a delicacy and guarded its secret as if they were top secret military plans. Transportation of the plant out of Muslim nations was forbidden by the government. Legend has it that a man named Babu Budan bound seven coffee seeds to his belly and smuggled it out of Arabia into India. He found a cave in the hills near the Western Ghats where he planted the coffee beans. Later he
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Coffee is the second largest trade commodity in the world and is extremely important foreign exchange earnings. Brazil and Columbia are the top two coffee producers in the world. They account for more than 40 % of the total world produce and while Indias contribution is just 4.1%.
India is the sixth largest producer of coffee in the world. India accounts for over 4% of the worlds coffee production with the bulk of all production taking place in its southern states. India is most noted for its Monsoonal Malabar variety. It is believed that coffee has been cultivated in India longer than anywhere outside Arabian Peninsula. Indian coffee is rated amongst the worlds best in the International market and is exported to countries like Australia, Belgium, USA, United Kingdom, Russia, Europe, Sweden, Norway, Yugoslavia, Japan, and the Gulf countries.
In Indian coffee cultivation is largely confined to the hilly regions of the southern states of Karnataka, Tamil Nadu, and Kerala. Karnataka accounts for 53% of the planted area (59% planted is Arabica and 41% planted is Robusta) and Kerala is being dominated by Robusta about 28% of the plant area. In Tamil Nadu the crop is mostly Arabica which has 11% of planted area. About 1, 33, 049 small planters and 2, 948 large planters cultivate coffee during the year. Among the coffee growing states Karnataka holds about 70% of the countrys total coffee production followed by Kerala by about 22% and Tamil Nadu by about 7%. Europe accounts for about 70% of Indias coffee exports.
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Today Coffee Day is at the forefront of the Coffee revolution- co riding with coffee growers, suppliers, corporations and planters. We are on this constant journey! Always trying to grow and help sustain growth and raise the bar continuously.
ABCTCL AT A GLANCE
AMALGAMATED BEAN COFFEE TRADING COMPANY LIMITED (ABCTCL), located in Bangalore, a city that has grown from a pensioners paradise to the countrys Silicon Valley. Coffee Day has become an icon for a good coffee.
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The heritage concept of coffee, dating from over 140 years has been nurtured with care by Mr. V G Siddhartha, Chairman of the Coffee Day Company. Launched in 1994, the group is now a 700 crore + company, ISO 9002 certified company, making its mark in the coffee value chain. The offshoots include over 1000 Caf Coffee day joints, around 400 Fresh & Ground stores, over 900+ Coffee Day Xpress kiosks, and a sizeable 10,000 vending machines from Coffee Day Beverages.
ABCTCL is a fully integrated coffee company it has a very rich heritage that stretches over a century. It has developed innovative retailing concepts to maintain a dominant position in the coffee sector. It ensures a prominent force in the coffee industry by maintaining quality coffee blends through extensive Research and Development.
It was the traditionally owned family acres of coffee estates in Chikmaglur, which yielded rich coffee beans- the starting point of a new empire. Soon ABCTCL, popularly known as Coffee Day was formed. With the opportunity that arose with the deregulation of the Coffee Board in the early Nineties, Coffee Day began exporting coffee across to USA, Europe and Japan. In 2000 Coffee Day exported more than 27000 tons of coffee valued at US $60 million to these countries. It has gained the largest coffee exporter of India many a times.
ABCTCL engages in the retail, plantations, and export of coffee and it offers gourmet single origin and Indian monsooned coffees. It operates a chain of retail outlets and provides tea and coffee beverages, varieties of coffee and tea powder,
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Coffee Days professional network is vast covering a homogenous region. It covers major coffee growing areas of the country comprising over 48 agents and 50 collecting depots. Coffee Day has two curing works at Chikmaglur and Hassan. They cure over 70,000 tons of coffee per annum, the largest in the country. Coffee Day has a well equipped roasting unit catering to the specific requirements of the consumers. Experienced personnel carry out the process to meet highest quality standards. ABCTCL uses the most modern technology available to maintain consistency and roast the coffee beans to the demanding specifications of the consumers. It has achieved a lot in a very short span of time.
With the vision of a true entrepreneur nurturing it, Coffee Day has its business spanning the entire value chain of coffee consumption in India. Its different divisions include: COFFEE DAY EXPORTS COFFEE DAY FRESH N GROUND (which owns 350 coffee bean and powder retail outlets ) COFFEE DAY VENDING (which owns 7000+ vending machines) COFFEE DAY XPRESS (which owns 900+ kiosks) CAF COFFEE DAY (which owns 1000+ outlets) COFFEE DAY PERFECT (FMCG packaged coffee) DIVISION
The smarter, the better! The red and white icon, the hall mark of the COFFEE DAY group, represents the vibrancy and that zing that the young at heart look for. Different divisions, different business and diverse focus areas Thats the Coffee Day Group. Each divisions run as independent units, yet rolls back into the same entity. Naturally, all the divisions are committed to provide customers with only the very best in quality- a hallmark thats integral to the Group.
Pioneering the Coffee Caf concept in India, Coffee Day opened its first Caf at Brigade Road, in 1996 still one of the most important happening places in Bangalore. The young and the young at heart immediately took to the place. A smart, simple space that they could call their own for a while. Discuss, listen to
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Caf Coffee Day, from a handful of cafs in six cities in the last 5 years has become Indias largest and premier retail chain of cafs aiming to reach 500 in India.
The stand up, walk away, take away Xpress coffee its coffee anytime and anywhere!
Hot, piping coffee is most welcome anytime and anywhere. It is something that lets you perk up, when you need a zing to life.
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Across innumerable campuses, or in Caf Coffee Day divisions, where people throng for something hot and special. Coffee Days dispensing machines- CELESTA and SIENNA play a key role.
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Coffee Day take away beverages are for consumers who are looking for a pleasant filter coffee experience. The machine offers its consumers both hot coffee and hot tea. Coffee Day Fresh & Ground Fresh & Ground stores in markets and shopping points cater to coffee lovers who love to make their own filtered coffee at home. This traditional thinking, quality conscious shopper is a royal customer. They look out for freshness and quality, but want to throw in their bit of character too. The freshly procured coffee from plantations is packaged in the most hygienic way to ensure consistency in freshness.
Fresh & Ground specializes in authentic filter coffee, with region specific blends of coffee and tea customized to demand. Besides an
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COFFEE DAY `Fresh `n Ground' has introduced packaged filter coffee powder 7 Day Wonder The coffee powder is claimed to be dispatched to the retail trade on the same day it is ground and packed; the company also says that the powder is withdrawn from store shelves if not sold within seven days. It is available in packs of 200 gm and can be purchased at retail outlets in Hyderabad and Bangalore.
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Coffee Day Exports is really the leader in growing, trading, retailing and exporting world- class coffee.
Coffee Day Exports is one of the largest exporters of green coffee in India, since 1999. It has invested in Research and Development, and applied in learning successfully to improve the promotion of various coffee blends and augment its exports.
Coffee Day Exports strongly believes that their responsibility begins with the origin of the coffee bean- right from ensuring ethical growing practices to packaging and retailing the product for their customers. Coffee Day Exports is well versed with experience and technological proficiencies to provide its customers with a wide assortment of well- positioned products. With regular feedbacks from customers and advisors, and backed by research, Coffee Day Exports continues to enhance their products.
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1992 THE DILUTION OF THE COFFEE BOARD THE PATH FOR ABCTCL TO ESTABLISH A STRONG BRAND IN THE FIELD OF IMPORT AND EXPORT ON INDIAN COFFEE
COFFEE
SPECIALLY MULTIPLE
BEVERAGES CHANNELS
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ACROSS
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EXPORTS, VENDING MACHINES/ TAKE AWAY, COFFEE DAY XPRESS, PERFECT CORPORATE OFFICE: MALLYA ROAD 23/2, COFFEE DAY SQUARE, VITTAL
LOGO:
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SMART KIOSK FORMATS, DIVERSE MENU, AND NUMEROUS RETAIL OUTLETS. IT AIMS AT CATERING TO THE INDUSTRY AND BUSINESS GAP BETWEEN CAF COFFEE DAY AND TAKE AWAY DIVISIONS. BUSINESS MODEL UNIQUE: 1. COMPANY OWNED 2. FRANCHISE SELLING PROPOSITION: EAT+ AFFORDABILITY+ TAKE AWAY. NUMBER OF OUTLETS: CITIES: TARGET GROUP: A, SEC A+, SEC B, CORPORATE, ITES & BPOS, BRAND HIGH & QUALITY DISPOSABLE 900+ PRESENCE FELT IN 15+ CITIES YOUTH BETWEEN 20-35 YEARS, SEC HYGEINIC+ QUICK SERVICE+ CONVENIENT TO
CONSCIOUS,
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Values and Principles: The age-old Indian value system has its imprint on Coffee
Days value system too. Coffee Day promotes a healthy working environment, which encourages and fosters a climate of openness, respect and innovation, along with Integrity, Leadership, Ownership and Trust.
Integrity: Coffee Day respects honesty within and outside the company. The
Group practices ethical business principles in law and spirit, and strive to bring the best to the consumer.
Ownership: Coffee Day drives the sense of ownership for its employees, providing
opportunities for learning, knowledge enhancement and continuous growth.
Trust: A strong foundation of trust encourages our people to deliver their best.
This trust is also extended to reflect in our endearing relationship with our loyal and growing clientele. In all we do, we strive for Respect, Innovation and Excellence the fuel that drives our growth.
Quality Policy
Coffee Day Xpress is following Standard of Procedure method in quality policy.
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CHAPTER 2
ORGANISATIONAL STRUCTURE
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PRESIDENT
GENERAL MANAGER
SENIOR MANAGER
MANAGER
ASSISTANT MANAGER
SENIOR EXECUTIVE
EXECUTIVE
MANAGEMENT TRAINEE
JUNIOR EXECUTIVES
ASSISTANTS
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HUMAN RESOURCES
BUSINESS DEVELOPMENT
MARKETING
OPERATIONS
SCM
MIS
INTERNAL AUDIT
FINANCE
PROJECTS
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KIOSK SET UP
(CDX kiosks do not have elaborate ambiences as such) The kiosks usually measure up to 80- 120 sq.ft depending upon the location.
footfalls is preferred The rental factor Existing competitors Facilities provided to competition/
corporate employees
The business development department works on the basis of its own database. It is created by the business development team members. The database is used for cold call, soon after which a meeting will be called for with the administration/ faculty Head of the Corporate Office. In case the meeting is held for only the corporate, a proposal is given and if it is retail like educational institutions or malls, a proposal for a menu is also is given. Following up the same is the work of the Business Development Team. Once the deal is finalized and the permission is granted the kiosk is set up. The BD is in charge of developing business. They locate areas for new outlets. They take care of relationship management with the existing outlets, both company owned and franchises.
To put a kiosk in their premises a LETTER of INTENT (LOI) is taken from the administration. It is only after this that a suitable franchise is searched. The agreement details vary according to the type of kiosk that is to be put up.
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COLD CALLS
PROPOSALS
The targets are set on monthly basis, which are reviewed on a quarterly basis. The Hierarchy is as follows: PRESIDENT
SENIOR MANAGER
ZONAL MANAGER
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REGIONAL MANAGER
CITY MANAGER
CITY MANAGER
AREA MANAGER
AREA SUPERVISOR
Vendor Selection:
There are three main criterias to be considered while making a selection of a vendor, namely Quality, The Vendors ability to deliver in volumes, The price at which the vendor is willing to supply. Regular auditing of the concerned manufacturing units of the vendor and the kitchen set-ups. These periodical checks ensure that the food and beverages meet the prescribed standards of Coffee Day Xpress.
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PRESIDENT
SENIOR MANAGER
Location Wise
EXECUTIVES
5. MANAGEMENT INFORMATION SYSTEM (MIS) They are responsible for the maintenance of all the hardware and software related issues in the orgaisation. The update of POS i.e. Point of Sales software which are used for billing in the outlets, Xpress website and provide MIS reports to aid the management.
6. FINANCE AND ACCOUNTS They are responsible for payment to vendors, calculation of wastage, verification of stock status, evaluation of financial data, auditing, tracking profit and loss of outlets, coordinating with sales tax authorities, providing finance for various activities of the outlets, time to time analysis of the brand standing position.
The Finance department acts as the guardian for CDX, providing back end services. Finance department is headed by Finance Head who will be reporting to the Chief Financial Officer and the President pertaining to the operations under his supervision. Each city has its own branch accountants and branch assistants (if required) who will be reporting to the Manager- Finance.
Finance department performs many services. It makes payment to the vendors and collects, analysis, reconcilliates and evaluates financial data. Getting the books
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PRESIDENT
HEAD OF DEPARTMENT
MANAGER (FINANCE)
7. PROJECTS
They have three divisions under them, namely;
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9. INTERNAL AUDIT
They conduct regular physical audit and check for any business malpractices and misuse of property. Its objectives are to examine, evaluate, and make reports on the adequacy of the internal controls for proper functioning of the departments. They are granted full and complete access to all corporate and franchisee manuals and computerized records, physical properties and personnel relevant to an audit or review without any prior notice or information.
They visit outlets and check if everything is in place and the outlets are being run as per the set standards. If gaps are noticed, then the Head Of the Department are intimated through mail as to what is wrong.
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Compensation & Performance Management and all legal issues related to employees.
Coffee Day Xpress has a full fledged HR Department. In view of conforming to the companys high standard of business ethics, its employees have to maintain a strict code of conduct.
Talent Acqusition Separation Induction and Orientation
Employee Relations
Leadership Academy
PMS
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Off rolls includes- Been buddies, Trainee Executives, Technicians. Sources of recruitment for off rolls are done through: Outsourced to a consultancy, In house, Employee reference. Selection: It is the process of selecting the right person for the right job. At ABCTCL, the process followed is as follows.
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The candidates who pass through the HR round are selected for the respective post
Placement: Once the candidate is selected he/she is placed for the respective position and the offer letter is sent to him/her through mail.
2) Induction and Orientation: Once the employee is placed for the respective post and he/she has receive the offer letter the joining date has to be confirmed based on which the induction is planned. Once the induction is planned by the training coordinator at the head office, the regional HRs coordinate and sees to it that the plan is put into action. Induction: As per the date scheduled, employees called for the induction. Induction is different for the On Rolls and Off Rolls.
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After the completion of the HR induction the employee would be inducted on the various departments in detain by the respective people from the various departments. This will also contain an in depth insight into the department with which the employee would be working. The induction would be scheduled across a period of one week in the department for which the employee would be working across 3-5 days based on requirement. The employee is then asked to fill a feedback form. Towards the end of the induction the employee would be given a test. This brings the employee to the end of the induction program. The KRA (key result areas) is designed for the purpose of reviewing his/her performance and the employee is put on probation of six months. After the induction is completed he/she takes on the duty and starts working as a full fledged employee of Coffee Day. During the course of induction the joining formalities are completed which includes, Giving the joining kit consisting of the joining forms, employee hand book CD, a scribbling pad and a pencil. Filling of the joining forms by the employee which includes the following forms. 1. Employee application form, 2. Joining report, 3. Application for med claim, ID card, Nomination and declaration form, 4. Bank account opening form.
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On Rolls The training that is given to on roll employees are mostly on the job where they learn in the course of their day to day duties during the probation period, apart from this there are other training programs that will be organized by the training coordinator if the need is recognized and if it is requested for by the employees. Off Rolls The Off Roll employees go through training sessions on Saturdays at Coffee Day Training centers situated in their respective locations.
3) COFFEE DAY LEADERSHIP ACADEMY: This is a special program initiated by HR department. In this program, the training coordinator sends reading material on motivation, leadership and material related to personality development, documents which consist of useful information which employees need to know how to improve their knowledge, material which helps in improvement of the working in the various departments. These materials are sent to
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At Coffee Day, PMS is setup to help the managers in the employee management and also help the employee in planning his/her career. The formats provided below are designed to facilitate discussions between manager and his subordinate. On Rolls: PMS comprises of 3 main activities: 1. Performance Planning and Review 2. Career Development 3. Improvement plans
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objectives and targets set. Does not meet-has met some of the required objectives and targets set. Below Expectation- has not met some of the required objectives and targets set. 1 2
The performance appraisal format consists of 3 sections which are described as below: Section 1- Consists of Employee Details along with Appraisers Name & Designation. Section 2- Pertains to KRAs/ Job activities set for the year and are purely a performance indicator. These KRAs need to be filled in by the employee after discussing the same with his reporting supervisor with proper weight age given to the respective activities. The total should cumulate to 100. First the employee whose performance is being reviewed rates himself after which the appraisal will give his rating and also write remarks and recommendations if any.
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2. Career Development: Based on the above mentioned format the appraisal is done for the employees, which results in the employee getting a hike in the salary, promotion, transfer, recognition etc. as the case may be.
3. Improvement Plans: Based on the inputs obtained from the review forms the gaps in the standards set for the performance and the actual performance of the employee is identified and the necessary steps like training, feedback etc are given to the employee to improve his/her performance in future. The PMS forms should be duly completed and signed by Appraiser and Appraisee. A copy of the forms must be sent to HR department for record purpose in the personal file. Off Rolls For off Rolls, the appraisal is done by the operation executives based on the KRA designed for the employees by their supervisors. They are rated on a five pointer scale. The review form is signed by the employee himself, the operations executive, city head and regional HR. Based on the review from the necessary steps are taken to give incentives or if the performance is not up to the mark the employee is to be given training or removed from the job.
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6) HR OPERATIONS: Regional HR Manpower recruitment HR operations Cost reduction at regions Training at regions Submission forms on time Employee attendance Submission on statutory report (ESI & PF) to HO Meeting with agencies Ensuring salary pay to employees Recover plans of reimbursement planning and HR Admin Overall administration to be reduced Printing of visiting cards Permanent id card Travel booking and advances Processing of rental cheques and proper accounting Med claim insurance Outlet insurance updates/ reports Travel settlement report Vendor payment Daily sales report Sales MIS Launch and closure communication
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7) EMPLOYEE RELATION: This is nothing but grievances of the employees are related to the work rules and regulation, policy and procedure, health and safety regulations, past practices, changing the cultural norms unilaterally, individual victimization, salary bonus etc .Here the attitude on the part of management in their effort to understand the problems of the employees and resolve the issues amicably have better probability to maintain a culture of high performance. Effective grievance handling is an essential part of cultivating good employee relations and running a fair, successful and productive work place. Positive employee relations are two-way street. Both sides must give a little and try to work together. At ABCTCL , the HR department handles the employee grievances through an open door policy. If there is any complaints, they should report it to the HR Department, who will further look into the matter and try solving it to the best of their ability. If the complaint is beyond the control of HR
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8) SEPARATION: Exit interview or separation as it called in ABTCL is interviewed conducted by an employer of a departing employee. They are generally conducted by a relatively neutral party, such as human resource staff member, so that the employee will be more inclined to be candid a opposed to worrying about burning bridges. The purpose of an exit interview is usually to gather data for improving working conditions and retaining employees. At ABCTCL, the exit interview or separation procedure involves filling of the exit form which includes the following details: Reasons for resigning What the person liked the most about the job What he least liked about the job Supervisor review Rating on the various compensation and benefits Rating on the various training programs and potential for growth in the organization What would be the situations that would prevent the person from leaving Would the person consider working in the organization future Suggestion if any Along with filling of this form, the employee must also handover all the assets of the company that were in his possession during his course of working with the company along with all confidential documents. The employee should keep all the information attained about the business, the vendors, other business associates during the course of his job at the organization confidential.
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EAST
NORTH
SOUTH
WEST
KOLKATA
BANGALORE
MUMBAI
PUNE/ NAGPUR
AHMEDABAD
SURAT
MYSORE
BHILAI
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The Business development Department has to find a suitable location with a captive audience of 800+.
Once the location of the kiosk has been decided, the Projects Department do the designing for the outlet along with the supply of machinery required for the kiosk.
The Franchising Department also gets the in a franchisee to own the outlet.
Then the Marketing Department comes into the picture. They take care of the branding, promotional activities, and the communication to be done for the kiosk.
The F&B Department designs the menu for the kiosk depending upon where the kiosk is situated and the type of prospective customer who would visit the kiosk.
The Operation department does the executive work and Bean Buddy requirement planning for the kiosk.
Once the menu and the manpower planning are in place, the Supply Chain Management Department (SCM) starts action. They locate suppliers and direct supplies to the kiosks.
Now everything required for the kiosk is in place, the Business Development department is intimated and the operation of the kiosk is started.
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SCM
Projects
Operations
Marketing
F&B
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The management at Coffee Day Xpress made it a point that the rebranding was restricted to articles that were placed directly in front of the customer or in his line of vision at the kiosk. This was to ensure the customer was exposed to only one set of branding and logos either new or old, but not a combination of both which has a detrimental effect on the image of the company.
1. FRANCHISED OUTLETS
Here the outlets are franchised after taking into condition the strategic locations of the same. It is the responsibility of the franchisee to handle the outlet in accordance
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2. COMPANY OWNED OUTLETS In this case as the name suggests, the company, i.e. CDX takes the responsibility to operate the outlet through its trained Bean Buddies. Some 400+ kiosks under Coffee Day Xpress operate under the company owned outlets.
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VENDOR
MOTHER WAREHOUSE
REGIONAL WAREHOUSE
WAREHOUSE
CUSTOMER
OUTLET
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As illustrated from the figure above, all in-station and outstation supply of the products and equipments takes place from the mother warehouse through the Coffee Day Xpress own or hired transport services to the regional warehouses and to the other warehouses/ outlets.
The Supply Chain Management Department of the Coffee Day Xpress division is concerned with the primary activity of INBOUND/ OUTBOUND LOGISTICS and PROCUREMENT. Responsible for major activities like purchasing, vendor management, warehousing and distribution, inventory planning and demand forecasting. They are responsible for making the right products available at the right place at the right time and thus improve efficiency in operations. It has two sections of activities that it has adhere to. One being the Receiving Process, and the other being the Dispatch Process. The functions of SCM Department are as follows:
1. PLANNING
Planning involves forecasting the future requirement of the different items under various product categories, as well as Dispatch Planning. Estimations for future orders are made on the basis of closing stock available and the average sales of the of all the outlets in India as a whole during the previous three months duration. There are 2 terminologies associated with Dispatch Planning: Local/ Milk Route Planning
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The MILK ROUTE terminology into being from the age old concept of supply of milk which used to happen every day, during the early hours of the morning without fail to all the locations/ outlets/ shops of sale. Similarly, CDX drafted a weekly chart through which they allocated the regions in and around Bangalore to a particular day, so that all outlets falling under the specific region will be catered to on that particular day, even if it is a new kiosk opened recently. Outstation dispatch of items is done twice in a week.
2. PROCUREMENT The entire process for SCM Department starts with the procurement of items/ products from the various vendors. Procurement process initiates with the selection of the vendors through invitations through quotations or tenders and raising of Purchase Order, based on the weekly requirement indent filed by the Bean Buddies from the kiosks nationwide. The criterias for selecting a vendor include: Quality The Vendors ability to deliver in volumes The price at which the vendor is willing to supply. The vendors current/ existing client database.
3. STOCK/ INVENTORY MANAGEMENT This is one of the most important components of the SCM Department, as Inventory Management requires a lot of specifications and details to be looked into especially at the time if receiving and dispatching of materials. Inventory Management has 3 important components, namely;
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4. VENDOR MANAGEMNT Vendor selection only forms a part of the procurement process. Vendor management involves careful screening of legal documents, timely bills submission and effective payment system. The credit period offered at Coffee Day Xpress normally ranges between 45 60 days. The payment must be only through cheque.
5. PREPARATION OF REPORT The SCM Department has to prepare not annual, but monthly reports stating the progress of the firm. There are three types of reports that SCM Department follows up with, namely Monthly Budget (it is a nation wise budget) Monthly operating report (this is in direct relation to the Management information System Department, where the daily8 proceedings get updated) Need Based Reports (these reports are prepared as and when the need arises)
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LOCATION
BIN CARD
AUDIT
Binning and sorting of the items are done to place the goods according to their product category under a common order and place. A particular
format is followed to carry out the process and the information is filled in as per the format, such as MIN number, Vendor Name, Invoice No & Date, Item Name, Sorting Date, Quantity (actual, shortage, damaged, excess). The
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INDENT
PICK LIST
DELIVERY CHALLAN
VERIFICATION OF DOCUMENTS
ACKNOWLEDGED DOCUMENTS
FILING
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MANAGER, SCM
SENIOR EXECUTIVES
EXECUTIVES
JUNIOR EXECUTIVES
MANAGEMENT TRAINEES
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EAST
NORTH
SOUTH
WEST
DELHI/ NOIDA
MYSORE
PUNE
CHANDIGARH
HYDERABAD
SURAT
JAIPUR
CHENNAI
NAGPUR
GOA
BHILAI
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2. Quotation sheet; The quotation sheet contains vendor details such as Company/ Billing Address, Outlet Address, Tax number (both VAT & CST) for authenticity. Product information such as Product Specifications, Physical parameters, Production Details, Rate of the Product, Packaging Details, Product Dispatch Details. Contact details of the vendor/ supplier such as Phone Number (it is generally stipulated by the SCM Dept. that the vendor must give two phone numbers), E- Mail, Fax Number, etc.
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PRODUCT CATEGORY
1. CONSUMABLES
ITEM NAMES
CAKE BOX (HALF KG) CAKE BOX (ONE KG) COLD CUPS (250 ML) COLD CUPS 200ML COLD LID 250ML(DOME SHAPE) COLD LID DOME-200ML DOILY PAPER (RECT) HOT CUPS (150 ML) HOT CUPS (200 ML) HOT CUPS (250 ML) HOT CUPS 110ML HOT LIDS 200 ML HOT LIDS (250 ML) MILK CRATES PAPER BOWLS PAPER PLATE PAPER POUCH PL HAND GLOVES SPOON STIRRERS STRAWS THERMAL ROLL TISSUE
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BOOST SACHET (15 GMS) CARDOMOM TEA BAGS CHOCOLATE SYRUP CITRIC ACID CITRIC ACID (ANHYDROUS) COFFEE BEANS XPRESS BLEND (1 KG) COFFEE CONCENTRATE (500 ML) COFFEE PREMIX (1KG) COMMON BASE (500 GMS) DAIRY WHITENER EQUAL SUGAR GINGER LIME SYRUP SATCHET 20ML GINGER PREMIX 1 KG GINGER TEA BAGS HORLICKS SACHET (10 GMS)
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4. PACKING EQUIPMENT
5. HOUSEKEEPING
BROOM WITH STICK BUCKET CHECK CLOTH CLEANING LIQUID GARBAGE COVER
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CHAPTER 4
SWOT ANALYSIS
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1) VERY GOOD BRAND NAME OF COFFEE DAY Coffee Day has emerged as a leader in its field and therefore has created its own brand name for being the only vertically integrated coffee organization. Coffee Day has always believed in The smarter. . . The better. Different divisions, different businesses, and diverse focus areas, that is Coffee Day Group.
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5) COFFEE
DAY
XPRESS
HAS
GOOD
NUMBER
OF
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(4.1) WEAKNESS:
1) Business is concentrated and dependent more around corporate offices and shopping malls, educational institutions though they have identified lots of other locations. 2) Concentrate only on prime locations and cosmopolitan cities. 3) Targets only youths and executives. 4) Same variety of food and beverages or menu in almost every outlet. 5) Prices are relatively higher than the local coffee/ tea stalls. 6) Mainly in the colleges estimating daily demand is very difficult.
M P Birla Institute of Management, Bangalore Page 81
(4.2) OPPORTUNITIES:
1) LESS COMPETITION As there are few players, Coffee Day Xpress has wide market availability.
4) LESS COMPETITION
M P Birla Institute of Management, Bangalore Page 82
5) YOUTH ORIENTATION Coffee Day Xpress has a good opportunity to serve young people, because if they become loyal to it, Coffee Day Xpress can enjoy continuous relationship. Coffee day Xpress has always believed that that their biggest brand ambassadors are the youth that they are targeting to. They are the most impacted customers and offer the most brand loyalty, and there are an equally large number of them working in corporate business firms.
6) INCREASING COFFEE CONSUMPTON In India coffee consumers are increasing and also people are getting busy day by day, hence the concept of Coffee Day Xpress attracts more takers. This especially holds good for corporate employees who have to stay efficient while at work and a quick and refreshing coffee is what they look forward to.
(4.2) THREATS:
1. Few main competitors like Barista, Fusion Espresso (TATA), Costa are immediate threats to Coffee Day Xpress. Entry of these players into the market will lead to a very competitive price war as all these companies command a very brand in the market.
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No structured format was in use No documentation of records regarding product categories and new product developments after rebranding. The existing database consisted of products pictures with old logo and also products which were not being procured or used by CDX in any of the outlets. Space consumption in the mother warehouse in Bangalore, was according to my observation, was another problem area. There are certain areas which are occupied by unused boxes thereby creating the space shortage.
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SUGGESTIONS
Remove or relocate the unused stock, which is blocking the floor area in the warehouse. Capital Items should be kept in a more systematic way. This would enable to utilize the floor area better.
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CHAPTER 5
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2. The one very good thing about CDX is that the superiors and subordinates are in direct communication with each other.
3. The reasons for such positive results for the company have been mainly achieved by strong and dynamic leadership of the President, as well as Heads of Departments.
4. Great care is taken by Coffee Day Xpress that they cater to every need and criterias with regards to procurement, storage, supply and serving of Food & beverages. The Quality Team at CDX ensures that all specifications are met.
5. Employees are provided with compensation and benefits, Training & Development, periodic performance appraisals as and when required.
6. The Managers are very particular about their work and go about their job in a very professional manner.
7. Regular and consistent feedback is taken by the Managers from their subordinates (Regional/ Assistant Managers) regarding execution of the work, and performance evaluation.
8. CDX maintains good healthy relations with all its vendors and franchisees across the country. No wonder CDX looks to add more franchisor to their already existing list.
M P Birla Institute of Management, Bangalore Page 87
CDX caters to the mobile population of the city, who are always on the move, always in a hurry. Coffee Day Xpress believes in keeping it short and simple. The convenient and quicker modes of service provide the people a smarter and efficient way of staying ahead of time. Coffee Day Xpress is into the segment of Food & beverages and the nature of business carried is the concept of take away where hurried people can have refreshment at Xpress in between their busy work schedule. Coffee day Xpress runs many outlets on its own and no sharing of risks and profits with third party. In addition, it has franchisee network, where it gives franchises to others.
One of the most striking features of the CDX division is that it comprises of young and dynamic team whose hard work has paid dividends in the form of the number of kiosks that are opening in around 20+ cities in India. Strategically positioned kiosks where a customer can not only grab a quick bite. Xpress gives emphasis to quality and the freshness of the product as well as affordability. Coffee Day Xpress provides quick and delightful services. The reason for Coffee Day Xpress to stand out is the personal commitment from the members, i.e. staff at all levels.
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