Being used to born-with-a-silver-spoon, cooking is the biggest problem of mine as of now. Its not the question about scarcity of resources, rather the case of increasing "sombheriness"! (lazyness). Just that when you are staying alone, you don't want to go to the kitchen to cook for yourself. So I get driven away to all sort of eating joints near our place atleast once a week, to gauge them. The most popular ones in order of my preference are Subway, Hungry Jacks, McDonalds and KFC.

Subway have some delicious stuff, mostly fresh and made right in front of your eyes. I love them for the veggie stuff, since all I can have in that. I have heard Hungry Jacks are quite good when it comes to vegetarian burgers. Due to the proximity I have not been able to explore them. McDonalds have to be in there, that's why they are here. KFC won't sell veggie stuff, so I go there with friends for just the mega-sized-ever-filling-finger-chips.

What do I think about all these when I am there? Ever since we had the accounting class on Cost-Volume, my thinking towards these mini-eat outs have changed. If you consider the cost these franchises would be shelling out for the whole thing, will be significantly more than any normal store in a suburban area. Place is a premium for them for attracting customers. Rate are uniform no matter if the store is in North Sydney or Epping, rather following a pretty centralised policy about the price and other promotional related stuff. So when a customer walks into a Subway in George Street or Manly, he cannot make out a great deal of difference.

But what is that which makes them so profitable?! Lets even include the coffee pubs into the debate here. Since the space is of premium and so as the Fixed cost of making the eatery or coffee pubs, the only way to maximise profits is by scaling the heights in the volume sold. In economic sense, the more you sell you costs may increase due to the scarcity of resources but in accounting sense, the more you sell your overheads are evenly distributed. I am sure any enterprise would be looking to sell as much as possible in support of the make hay when the sun is shining concept. There are also other strategies which they follow.

I am also going to bring in the coffee pubs into the discussion here, since they are equite the same comparing the Subway joints. If you notice the coffee served in these pubs, it would be luke warm, which means that unless you drink when it is immedietly served you will loose the 'hot'ness involved inside it. So you will have to resort to ordering another one, which most won't be willing to do, due to many reasons. By doing the same indirectly you are increasing the customer turnover rate in the positive way. When I say positive here, it means every customer entering the store walks out after being treated himself with a drink. I am sure the store would have a calculation of one customer one coffee or one subway here.

By positively increasing the customer turn over rate, you are liable to achieve the distribution of overheads. Talking about overheads, the main cost of any business entity are fixed and variable, which is normal. But the ratio involved in this may vary. A coffee pub may have their Fixed costs to be way more than the variable cost. Whereas when a guy is opering on a call basis a.k.a mobile basis, he may not have to incur so much since he can do that from his home itself.

Even the temperature inside the store would be very cool, which in turn drives the coolness of the coffee, which indirectly affects the customers consuming them in a faster rate. When a finger chips is ordered, if you notice the pack you can see a 'V' shape curving into the cup. With a normal eye, you won't notice the amount it can protect from holding. But trust me its yet another way of stimulating the customer by appealing it gives more concept. Actually when you see it, the case won't be the same. Like wise there are many things for consideration here.

I admire the way these guys do the business, till the time I enter into their kitchens!


Filtered by sambhar....