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Back to Newsletter Vol 2, Issue 02, May 2020
Business Strategy
The case ‘Gits Food – Pioneering Indian Convenience Food’ provides a glimpse into the journey of a family business, Gits Food Products Pvt. Ltd. (Gits), in the Indian convenience food market. The case starts out with a description of the early days of Gits, where it struggled to find a market for convenience foods in India. That prompted it to look toward overseas markets. The case then documents the reasons that drove Gits to take a renewed interest in the Indian market in the 2000s. The product and marketing strategies of the company to capture a share of the emerging Indian convenience food market are depicted in detail. The case also provides a glimpse into the leadership role played by the third generation of the family business in successfully steering the company in tune with the changing scenario in the market. The case takes a brief look at the challenges plaguing the industry. It ends with a look into the future prospects of the company in the Indian food processing industry that has large scope for expansion.

Gits Food – Pioneering Indian Convenience Food
The US-based Subway, the world's largest restaurant chain by number of locations, found itself in deep trouble in 2019 in its home country. After being popular for more than 50 years for its healthy subs with unlimited options to customize, Subway was falling behind competitors, who had come up with products that were similar to or better than Subway’s. Subway was unable to cater to the changing demands of the customers, who wanted healthier food and food that was fresh, organic, and procured locally. Also, there were changes in the way the food was consumed. While some customers preferred plush interiors and restaurants, others wanted to grab food on the move through drive-ins. More and more customers wanted food delivered to them. Subway, which expanded rapidly over the years, was facing a huge backlash from the franchisees in the US. Rapid expansion over the years had resulted in oversaturation, with the franchisees, especially those in the US, self-cannibalizing sales due to operating in close proximity to the Subway restaurants. Several outlets were closed due to consistently declining sales and traffic. To attract customers and face the competition, Subway started lowering prices. This angered the franchisees as their margins were impacted. Amidst these problems, the founder of Subway, Fred DeLuca, died in 2015, and his sister took over. The franchisees were not happy with her leadership, and complained of a leadership vacuum. As the chain continued to face challenges, the operations were handed over in mid-2018 to Trevor Haynes (Haynes), who became its interim CEO. It remained to be seen how Haynes would bring the beleaguered chain back to glory.

Subway – the World’s Largest Fast Food Chain on a Downward Spiral
The case “IDFC First Bank’s Technology-led Banking Services and Digital Media Promotion” talks about the various initiatives launched by India-based IDFC First Bank to be a leader in technology-led banking services in India. The case starts out with a brief history of IDFC First Bank. It then describes the merger of IDFC Bank and Capital First Ltd. (Capital First). The case touches upon the use of digital technologies by IDFC Bank and the launch of its financial services. It then describes how the bank used digital media not only to promote its products and services but also to promote the brand – IDFC First Bank. The case also highlights the future plans of IDFC First Bank.

IDFC First Bank’s Technology-led Banking Services and Digital Media Promotion
The case study describes the journey of Reliance Communications (RCom) from being an industry leader to going bankrupt. It also traces the history of RCom since it was founded in the 2000s by Indian business tycoon MukeshAmbani (Mukesh). Mukesh handed over the company to his brother Anil Ambani (Anil) in 2005, after the brothers divided the business of Reliance Industries, a conglomerate founded by their father Dhirubhai Ambani, among themselves. Having been a pioneer in the telecom industry, RCom, under Anil’s leadership, made a slew of investments to develop telecom infrastructure with the idea of becoming the leading player in mobile telecom in the country and offering telecom services at affordable prices. However, despite being in a strong competitive position, RCom was unable to sustain its position due to the changing dynamics of the telecom industry and the acute competition from various players in the market. The failure to maintain its momentum in the face of the ever changing market dynamics put RCom in a critical position with a growing debt burden. The launch of Reliance Jio by Mukesh, which marked his re-entry into telecom, proved to be the death knell for RCom. The present case study provides the scope to discuss the competitive scenario in the Indian telecom industry, the strategy adopted by RCom, the reasons for the failure of the company, and the future of the telecom industry in India

The Fall of Reliance Communications
Forever 21, a US-based fashion retail brand headquartered in Los Angeles, California, was started by a South Korean immigrant couple, Jin Sook and Do Won Chang, in 1984. Forever 21 was a forerunner in the fast fashion industry and, spurred by its initial success, it started opening new stores at frequent intervals. But on September 29, 2019, Forever 21 filed for Chapter 11 bankruptcy protection to restructure its business. The company said, "We do however expect a significant number of these stores will remain open and operate as usual, and we do not expect to exit any major markets in the US." The company had 549 stores in the US and 251 stores in other countries at the time of filing bankruptcy. The company said it planned to "exit most international locations in Asia and Europe" but would continue to operate in Mexico and Latin America. It was expected to close up to 350 stores worldwide, including 178 stores in the US. A Forever 21 spokesperson said the retailer expected to have between 450 and 500 stores globally after this process. The case discusses the origin and growth of Forever 21, and the factors that led to its downfall – rapid expansion, global recession, retail apocalypse, and changing consumer preferences.

The Reset Button Pushed by Forever 21
The case is about US-based clothing retail chain store Charlotte Russe Holdings Corp. that filed for Chapter 11 bankruptcy protection in February 2019 in a bid to get relief from mounting debt. The fashion retailer had been struggling to cope for some time after it had incurred heavy losses in its business and had announced a deal to renegotiate certain debts. However, this deal failed to deliver. It then tried to find a buyer for the company. In February 2019, it filed for Chapter 11 bankruptcy, planning to close down about 94 of its 512 stores. Soon after the filing, the company entered into talks with prospective buyers to avoid liquidation of all of its assets. Nearly a month after Charlotte Russe filed for bankruptcy, it announced that it would go out of business and close down all its stores as it had failed to find a buyer. Meanwhile, the company remained in negotiations to sell off its intellectual property. While the liquidation firm SB360 Capital Partners bought the mall chain’s assets, its intellectual property remained intact, indicating that the store’s brand could come back in some form in the future. Later, Charlotte Russe sold its brand and related intellectual property to Canadian fashion house YM Inc. YM Inc. announced plans to re-launch the brand by opening 100 retail locations across the country. It also had plans to launch a new online shopping experience. It remained to be seen whether the new management would manage to revive the company.

Charlotte Russe Bankruptcy: A Revival Plan
The case highlights the journey of Snapdeal, the peaks of success that it touched as well as the challenges and failures it faced until it finally achieved a turnaround. It also briefly describes the life cycle of a start-up to understand the various stages it goes through, the changing external environment, and how to make a decision based on the strengths and weaknesses of the company in the context of the opportunities and challenges that emerge over time. The case study uses the story of Snapdeal to bring out these insights.

Snapdeal – From Troubling Times to Turnaround
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