Raju Omlet: Case Vignette

Raju Omlet: Case Vignette

Executive Summary

As an 18-chair eatery, Raju Omlet has achieved a popular niche “by growing in terms of footfall, scale and financials.”^[1]  The success mantra of “Eggs Laid Yesterday Made Today” has successfully displayed Rajiv Meherish’s philanthropic inclination of being fair in business and delivering true value to customers.^[2]  Because of the dedication to freshly sourced eggs, the egg dishes stood out against other restaurants because of its exceptionally better quality of preparation and taste.  Raju Omlet became known for its good food, exceptional service, and welcoming environment, three factors that influence customer satisfaction.  Because the product is as simple as an egg dish, the low prices of the meals offered at the restaurant make the company stand out amongst its competitors.

Raju Omlet is examining the issue of whether the company should diversify their product-range.  If the company goes through with diversifying their products, Rajiv is concerned with preventing the dilution of the Raju Omlet brand proposition.  Therefore, the company needs a way to retain value proposition while diversifying.  If Raju Omlet does not diversify their products, competitors will soon lower their prices to gain more popularity amongst potential and current customers.

Raju Omlet should diversify their products to build on their popularity and success.  Yet, it is essential for the company to first experiment on different diversification thoughts.  To retain the value proposition while diversifying, Raju Omlet should maintain the same standard base line product to preserve the popular egg dish concept of the company.  Diversification of this sort through adding unique details to the egg dish relevant to the location of the store (local flavors and ingredients) as was done in the initial location will help to diversify the product while maintaining the familiarity that originally drew customers in to the brand in the first place.

Problem Identification

The problem that Raju Omlet is facing the problem of figuring out how to retain value proposition in the process of diversifying their product range.  With restaurants such as Bombay Chowpatty, Chappan Bhog, Bikanervala, Kulcha King, and Mumbai Restaurant, Raju Omlet is up against major competitors that offer greater variety through numerous outlets.  The table below highlights the restaurants and what they offer.  These competitors comprise the majority of the restaurants within the vicinity of Raju Omlet and are similar in the sense that they serve to the Indian and Pakistani expatriate community in the United Arab Emirates (UAE).

Relevant Competitors

[pic 1]

Analysis

When diversifying the products offered to customers, it is important to protect the brand proposition of Raju Omlet.  Raju Omlet is currently known for its uniquely specialized egg preparations. Raju Omlet’s key weaknesses include the following:

• High cost of ingredients for the supreme quality of fresh food^[3]
• No food delivery option to customers’ homes
• Lack of current strategy for company growth
• Limited potential for profit due to the currently limited brand proposition of services
• Single location against competitors with several outlets

Opportunities can be found despite these weaknesses because the company has no direct competitors due to Raju Omlet’s product being of such a specified nature.  Nevertheless, some companies, such as the ones listed above, are more aggressive than others in attacking markets or defending their current one.  Raju Omlet has the potential to target a greater range of customers due to their strategic location placement and brand proposition, providing access to a large sector of expatriates.

        If Raju Omlet does not diversify, the threats of competition depending on the level of aggression of competitors, will prevent the company from sustaining its growth.  Raju Omlet should analyze how its competitors react to threats and opportunities to get a better sense of the aggression factor.  Based on the competitors’ level of diversity and amount of outlets, they are relatively aggressive in their competitive nature.  Because Raju Omlet is so dependent on a narrow segment of products for their customers, they are not expanding to the full potential market of customers that could be attracted through additional options and added diversity.  The simplicity of the product being offered could be relatively easily replicated by competitors looking to compete on the same level.