STRATEGIC MANAGEMENT

Group Project Report on SWIGGY

POST GRADUATE DIPLOMA IN MANAGEMENT

(Term-III; Batch 2019-21)

Under the Supervision of

Prof. Sudhir Sharma

Submitted by- Group 2

Aashi Sharma
Ayush Kaushik
Rahul Kumar
Rakesh Mishra
Ujjwal Chaturvedi

JAIPURIA INSTITUTE OF MANAGEMENT

A-32 A, Sector 62, Institutional Area, Noida- 201309 (U.P.)

INTRODUCTION
 Swiggy, a food ordering and delivery company based out of Bangalore,
India
 It was founded in 2014
 Tagline – “Swiggy Karo, phir jo chahe Karo!”
 Founders was Rahul Jaimini, Sriharsha Majety and Nandan Reddy
 It began with 6 delivery executives and 25 restaurants on its platform. In
the time of 3 years, it has scaled up with over 6,000 delivery executives
across India in more than 8 cities like Delhi-NCR, Mumbai, Bengaluru,
Hyderabad, Chennai, Kolkata and Pune
 A single window for ordering from a wide range of restaurants, the
company have its own exclusive fleet of delivery personnel to pick up
orders from restaurants and deliver it to customers.

VISION
Swiggy’s vision is to elevate the quality of life of urban consumers by offering
unparallel convenience

MISSION
“By 2020, we will expand SWIGGYGO to over 300 cities and Swiggy stores to all
the major metros, ushering in a new era of convenience for consumers across
India.”
GOALS
 To revolutionize the restaurant-takeaway-delivery business in India
 Reliability and consistency in service
 Evolve as a leading marketplace
 Increase market share
 Increase brand building and marketing campaigns
 Achieve more than break-even in the existing cities
 Expand to six new cities in the next one year

OBJECTIVES
Swiggy came into existence with the idea of the co-founders to provide an end to
end food service, right from order to delivery; all this from the comfort of one’s
home. The objective of the company is to disrupt the kitchen at home and make
their delivery service a viable option for an everyday food need.

CORE COMPETENCIES
 Quick delivery
 Sensible complete image
 Trained folks for creating making delivery
 Wide selection of eating place offered
 Delivery is free
 Neat packaging
ENVIRONMENT ANALYSIS

PESTLE Analysis of Food Industry

In current market scenario, ‘food industry is one of the strongest industries in the
world’. There are some interesting dynamics like increasing labor cost, which
makes it unclear as to how profitable the food industry is going to be.

So now with this PESTLE Analysis, we’re going to see the factors such as ‘Political,
Economic, Socio-culture, Technological, Legal, and Environmental’ affecting the
food industry.

 POLITICAL

Political factor(s) effecting food industry:

WIDE REGULATION –

Government has the regulatory framework, which the players of food industry
have to follow. Cleanliness of kitchen, storing and transporting food and the
requirement of labor are the part of it. This gives the assurity to the customers
that they are not getting the poor quality of the food.

 ECONOMIC

Economic factors effecting food industry are:

‘GROWING DISPOSABLE INCOMES –

In the recent trend, income of lower, middle- and upper-class population has
increased, which has given them more power for spending on luxuries item –
which includes food industry also. Individuals have started to cook less and eat
out more often, which has increased the revenue for food industry.’
‘INCREASING LABOR COST –

Disposable income is growing for a reason: labourers are earning more these
days. The cost of hiring workers is increasing all other industries. This is caused by
not only a growing demand for employees, but also higher and higher
government expectations for minimum wages. As in many other countries, the
effect of increasing labour cost is simple: less margin for the owner of the
business, and thus less profit.’

 ‘SOCIOCULTURAL

Sociocultural factors impacting food industry are:

HEALTH CONSCIOUSNESS –

Consumers have become more conscious for what they eat, as they know that
what they are eating is in direct relationship to their health. Consumer are looking
for healthier ways to provide proper food to their body. This factor compels the
food industry to adapt to the situation to stay relevant.’

DIETARY RESTRICTIONS –

Not only the type of food which the individuals are consuming but also the
information regarding their personal dietary restriction are also maintained by the
individuals these days. Again, like with the health consciousness increasing in
individuals, the food industry is adapting in the scenario, ‘the food industry has to
make changes to make its customers happy, because the customer is also
expecting greater understanding from the players involved in food industry.’

 TECHNOLOGICAL

Technological factor impacting food industry:

AUTOMATION –

The use of automation or technology in food industry has certainly increased. The
best example for it would be use of self-checkout screens at fast food ventures
such as McDonalds. Recently a video went viral on social media network, where a
robot was cooking omelette. As we find the more way of using the technology and
the robotics in the food industry, a smaller number of labourers would be
required. Overall it would be a win-win situation for the food industry as this
would increase the ‘profitability and reduce the likelihood of human error.’

 ‘LEGAL

Legal factors affecting the food industry are:

SAFETY STANDARDS –

As discussed earlier in the Political factors, the food industry has some standards
for safety matters. There are rules in every country on how food should be
prepared, stored and transported, including direction on what temperatures
various food type can reach, how they should be cleaned and so on. While this is
indeed largely a political issue, it becomes legal matter if any of these regulations
are ever breached. So, the players in the food industry has to be very careful
while keeping themselves in tact with the regulations to prevent costly lawsuits.’

 ‘ENVIRONMENTAL

Environmental factors affecting food industry are:

IMPACT OF MEAT –

With the growing of health repercussions of the food we eat, the environmental
repercussions have also increased among the individuals. Red meat is one such
problematic food group from environmental point of view. The meat industry is
tearing down lots of forest area for creating new space for farms. The result of
this is that more of the individuals are switching to plant-based diet. This is again
not a negative thing for food industry, but they will have to recognize the impact
of this shift in the long run.’

‘
PESTLE ANALYSIS OF FOOD INDUSTRY: FINAL THOUGHTS ’

The ‘PESTLE analysis of food industry’ shows the ‘mix’ of’ negatives, ‘positives and
uncertainties. ON the one hand, consumers are willing to spend’ more. ‘On’ the
other hand, labour cost is increasing and also the space is carefully regulated.
What more we’re seeing is that consumer’s diets are becoming more specific in
nature, which at the end increases the challenge for food industry.

PORTER 5 FORCES MODEL’

Porter 5 forces shape the essence of competition within the industry. ‘Many new
companies use the Porter’ 5 ‘forces model to’ see ‘whether’ they are going to be
profitable or not.

Here are the 5 forces in the form of pictorial representation:

  ‘THREATS OF NEW ENTRANTS’

‘Threat of new market’ players are always a challenge for the existing ‘market
players’ if the ‘industry is profitable and barriers to enter’ in ‘the’ in the ‘industry
are low.

Few factors which reduces the risk factor for Swiggy:

 Entry into the new industry requires the capital in substantial amount
 Swiggy ‘will face the low threat of’ the ‘new entrants if’ the existing
regulation ‘framework imposes challenges to new firms.’ This might
discourage few from operating in the market due ‘to ‘strict, time
consuming regulatory requirements.’

Swiggy can tackle the threat of new entrants by:

 Developing brand loyalty by working on customer relationship

management.
 Swiggy can invest on research and development activities, for getting
customer data and introducing innovative products.

 THREAT OF SUBSTITUTES

Availability of substitute products or service makes the environment competitive

for SWIGGY and other existing players.

The threat of substitutes increases, when:

 Substitute product offers same or superior quality performance as

compared to SWIGGY.
 Availability of cheaper product/service from another industry.

However, the threat of substitute is low for SWIGGY, when:

 The switching cost of substitute product is high.

 Customer is not getting the same level of satisfaction from other
substitutes.
  INDUSTRY RIVALRY

It shows the number of competitors present in the industry. Biggest rival for
SWIGGY is ZOMATO (which recently acquired UBER EATS). High competition
reduces the profitability for the firms in the industry, because firms adapt
aggressive marketing and pricing strategy against each other.

 BARGAINING POWER OF SUPPLIERS

Bargaining power of suppliers is when, due to supplier’s acts there is increase or

decrease in competition, profitability of the firms. Supplier can reduce the
product availability, reduce the quality or increase the prices. More the bargaining
power of suppliers, more it will cost the buyers to avail them.

Bargaining power of suppliers would be high for SWIGGY, when:

 Swiggy does not have adequate market knowledge, it automatically gives

more strengths to the suppliers.
 Presence of suppliers in the market also affects the bargaining power. If the
suppliers are not in that much amount and the products offered by them
are high in demand, then also the bargaining power of suppliers increase.
 Suppliers are concentrated on any specific region and their concentration is
higher than the buyers.

Bargaining power of supplier for SWIGGY would be low, when:

 Suppliers are not concentrated.

 Swiggy has high knowledge of the market.
 Switching cost from one supplier to another is low.

 BARGAINING POWER OF BUYERS

Just like the bargaining power of suppliers, bargaining power of customers also
creates an impact in the market. Customers create pressure on the firms for
providing good quality goods at an affordable price.
Factors responsible for increase bargaining power of customers against SWIGGY
are:

 Customers who are concentrated have the more bargaining power against
Swiggy.
 Lower the switching cost, higher the customer’s bargaining power.
 Customer’s purchasing power, knowledge about the product also increases
the bargaining power of customers.

PRODUCT AND PRICING STRATEGY

Product strategy:
Swiggy is one of the popular delivery companies that supplies ordered food and
beverage items to its customers. It provides single window and included a wide
range of food parlours and restaurants under its umbrella.

A customer now can make a choice from visual menus of restaurants in

neighbourhood and order online. Ordering food and getting a swift delivery has
become a hassle-free option from a customer viewpoint because of Swiggy.
Swiggy is not accountable for the quality of food as it only delivers from one hand
to another.

Swiggy has the strategy of making hyperlocal product deliveries. It has a delivery
diversification strategy. It aims to not only make the delivery for the food, but it
also aims to create a delivery system for medicine, grocery, gift shops and flower
shops and capture a larger share of the delivery market of India.

Pricing strategy:
If you are ordering from Swiggy, they will provide you with the restaurant’s name
along with their food menu including price so that you can check all of them and
decide accordingly. They even offer you with coupons that can be applied while
placing the order so that customer can get an extra discount on their total
amount. They would charge you with service tax which depends on the specific
restaurant customer are choosing. When it comes to the price, Swiggy is more
than trustworthy.

SWOT ANALYSIS
STRENGTHS WEAKNESS
 Quick delivery  Orders only available from
 Sensible complete image restaurants that are in the zone
 Trained folks for creating making of the order placed
delivery
 Wide selection of eating place  Low awareness of brand name
offered
 Delivery is free
 Neat packaging

OPPORTUNITY THREATS
 Pioneer in food delivery business  Increasing health consciousness
 Growing marketplace for  Increasing potential competitions
potential customers  Negligence of potential
 Increase in market share competitors
 Value effective and sensible
quality food
 Give higher service
TOWS ANALYSIS

OPPORTUNITY THREATS
STRENGTHS S/O STRATEGIES S/T STRATEGIES

With fast delivery, trained Amalgamation of fast

folks for delivery and delivery, trained
wide selection of eating employees, wide
place offered, Swiggy can restaurants and free
increase its market share delivery, Swiggy can
minimize threat of
increase competition

WEAKNESS W/O STRATEGIES W/T STRATEGIES

If Swiggy can expand their If Swiggy works more on

restaurants from which their branding and
they are taking orders, marketing strategies, they
they can target more would better take care of
potential customers and their competitors
establish a bigger market
for them
INTERNAL FACTORS EVALUATIONS (IFE) MODEL

Internal Factors Evaluations Weight Rating Weighted

score

STRENGTHS
Fast delivery 0.20 4 0.80

Free delivery 0.20 4 0.80

Neat packaging 0.15 4 0.60

Trained employees 0.15 4 0.60

WEAKNESS
Zonal restaurants 0.15 1 0.15
Low branding 0.15 2 0.30

Total 1.00 3.25

EXTERNAL FACTORS EVALUATIONS (EFE) MODEL

External Factors Evaluations Weight Rating Weighted

score

OPPORTUNITIES
Pioneer in food delivery business 0.20 4 0.80

Increase market share 0.25 4 1.00

Higher services 0.10 3 0.30

THREATS
Increasing health consciousness 0.15 1 0.15
Increasing potential competitions 0.30 1 0.30

Total 1.00 2.55

COMPETITIVE PROFILE MATRIX(CPM)

CPM SWIGGY ZOMATO

Key Success Weight Rating Weighted Rating Weighted
Factors score score
Delivery time 0.25 4 1.00 3 0.75
Neat packaging 0.20 4 0.80 4 0.80
Wide restaurants 0.20 3 0.60 3 0.60
range
Trained 0.15 3 0.45 3 0.45
employees
Delivery charges 0.10 4 0.40 4 0.40
Offers and 0.10 4 0.40 3 0.30
discounts
Total 1.00 3.65 3.30

Since, score of Swiggy is above 3.5 that means it is performing

very well and better than the competitors i.e. Zomato

INTERNAL-EXTERNAL (IE) MATRIX

 2.5
5

3.25

 Swiggy can be described as grow and build

 Intensive (market penetration, market development & product
development) or Integrative (backward, forward and horizontal) strategies
can be more appropriate for these.

STRATEGIC IMPLEMENTATION
1. Corporate Strategy: -
It is hierarchically the highest strategic plan of the organization, which defines the
corporate overall goals and directions and the way in which will be achieved
within strategic management activities. It is long term, clearly defined vision of
the direction of the company.

Types:
 Stability strategy: A strategy that seeks to maintain the status with the
uncertainty of the environment, when the industry is experiencing slow or
no growth conditions.
 Renewal strategy: Developing strategies to counter organization
weaknesses that are leading to performance decline.
 Growth strategy: Seeking to increase the organization’s business by
expansion into new products and markets.

So, Swiggy use growth strategy where the company Seeking to increase the
organization’s business by expansion into new products and markets.

Growth strategies: -

 Concentration – focusing on a primary line of business and increasing the

number of products offered or market served.
 Vertical Integration – backward and forward vertical integration
 Horizontal Integration – Combining operations with other competitors in
the same industry to increase competitive strengths.

In this, Swiggy use Concentration Growth Strategies

2. Business-level Strategy: -
A strategy that seeks to determine how an organization should compete in each
of its strategic business unit. At business-level allocation of resource among
functional-level a coordinate with the corporate level to the achievement of the
corporate level objectives.

Types: -
 Cost leadership- Attaining, then using the total lowest cost basis as a
competitive advantage.
 Differentiation- Using product features or services to distinguish the firm’s
offering from its competitors.
 Market focus- Concentrating competitively on a specific market segment.

In this, Swiggy use Cost Leadership strategy where the company using total
lowest cost basis as a competitive advantage.

3. Functional-level Strategy: -
Focus is on improving the effectiveness of operation within a company which is
done by-

 Manufacturing
 Marketing
 Materials Management
 Research and Development
 Human Resources

In this, Swiggy use Functional-level Strategy that’s focus is on only marketing

activities.

BALANCE SCORE CARD

A balance scorecard is the tool that is used to identify and improve its internal

business function and its resulting external outcome. It is also used to provide

feedback to the organisation.

Prespectives Objectives Measures Target (2020)

Financial  Increasing Revenue  Incresing number of  500 million
delivery persons and order in one
number of partner year
restaurants

Customer  Customer satisfaction  Customer feedback  More

 Building loyalty form customer
 Offers and discounts base
 Well-behaved
delivery persons

Internal  Quicker delivery  Providing motor  Covering

Process bikes to as many more
delivery boy as can geographical
area

Learnings  Employees retention  Market research  Increasing

and Growth  Employee engagement Market share

INDIVIDUAL CONTRIBUTION –
AASHI SHARMA- Product and Pricing Strategies, SWOT,TOWS, CPM and content

typing

UJJWAL CHATURVEDI- IE Matrix , strategic implementation and balance score

card

RAHUL KUMAR – Pestal and porter’s five force model

AYUSH KAUSHIK- Goals, covered every work related with survey forms

RAKESH MISHRA- Editing , vision and mission