Chulha

A Case Discussion

Context
Typical situation you will face in your campus
Students have an idea and either
A) feel strongly about it but dont know how to
go about it
OR
B) have already done some research work and
come to you to vet the idea

Words of Caution for students

If you are fundamentally in a lousy business, you

will not get very far irrespective of the efforts
and the talent.

No matter how talented you are and how much

capital you have, if you have not given your idea
a rigorous, critical examination before starting
out, you could be heading for a disaster.

When you buy a car, you take it for a test ride.

Why not do the same for your idea?
Source: The New Business Road Test ,
Prof. John W. Mullins (London Business School)

The Case
Chulha is a case of two techies who
recognized an opportunity in a problem faced
by themselves unappetizing canteen food.

Is Chulha a viable business?

Based on the opportunity evaluation
framework you have been introduced to and
with the help of the checklist, evaluate if
Chulha is a viable business.

Case Analysis
Market
Have the customers been clearly
identified?
Is there a definite customer problem being
solved?
Will the customers avail this tiffin service at
this price?
Is the size of the target market substantial?
Is there enough potential for growth?

Case Analysis
Industry
Are you able to understand how this product is
going to be delivered to target customers?
Are there substitutes for this product?
Is there anyone else already doing it?
Will it be difficult for others to replicate this
business?
Does the business employ superior
organisational processes, capabilities or
resources that others would have difficulty in
duplicating or imitating?

Industry Statistics
Food products are the biggest consumption
category in India, with spending on food
accounting for nearly 21% of GDP and 31%
share of the consumers wallet
Indias food industry is estimated at over
USD182 billion, accounting for about twothirds of the total retail sector
CAGR of 6.4% from 2004-08
Expected to reach $300 billion by 2015
Largely unorganised industry
[Source: India Food Report 2008]

Case Analysis
Team
Do the entrepreneurs have the skills to
execute the idea?
Do they have a network that can benefit
the business?

Case Analysis
Risk and Reward
Is it a highly risky business proposition?
Is the business profitable?
Substantiate with calculations.

Did you do your math?

Assumed monthly income for an IT
professional
x 2 persons

Selling price of tiffin

Cost price of
tiffin
Profit per tiffin
set

20000
40000
Veg
35

Non-veg
45

Total
80

15

20

35

20

25

45

Assuming 50 sets each of veg and non-veg sold per day (Total
100 sets)
Total profit per
day
2250
Total profit per month (22 days)
49500

Chulha is a real business

www.chulha.co.in

Where is Chulha today?

Delivering Mouthwatering & Healthy Food to people in
need of the same

Started in April 2007

They have now expanded their operations,
servicing more than 15 locations in Bangalore.
They offer full tiffins as well as mini tiffins (both
vegetarian and non-vegetarian), providing a
non-standardised menu of variety of cuisines.
They cater to corporates, PG accommodations,
individual customers and private parties.

Key Learnings
Asking the right questions while evaluating
the opportunity
Assessing the three main domains
Market, Industry, Team
Quick back of the envelope calculation

NEN Resources
All materials used in this session are available
in the NEN CD Kick-Starting the
Entrepreneurial Campus under Inside the
Classroom
section Entrepreneurship Concepts,
subsection How to evaluate opportunities