''I would not advocate franchising as a means for rolling out the cafes. This is a high-risk proposition'' Naresh Malhotra, Director, Amalgamated Bean Coffee

Lala's has localised knowledge, recognises its limitations, is aware of the competition and is willing to learn and change. This is remarkable in itself, because most companies operate with blinkers.

Lala's has another great advantage-of being a low-cost producer. Basically, if you can be a cost leader and have low overheads, it lays down the cornerstone for an efficient business.

For Lala's to succeed, it must structure the new cafes under a separate company so that the staff, the ethos and the culture are kept distinct. Other steps that are recommended are:

• The ambience and look has to be standardised. It should be vibrant to attract the youth.
• The location of the cafes must be near colleges, institutions, schools and other places where the young hang out.
• Today, youth are always looking for new things to do. The cafes must therefore build a theme around which new and exciting things are always happening. My suggestion would be music and fashion, as both these are ever-changing and are a great draw for the young. More importantly, these themes lend themselves very well to events and sponsorships, which get footfalls.

I would not advocate franchising as a means for rolling out the cafes. This is a high-risk proposition. Franchising is only for well-entrenched brands. It needs huge capital on advertising, and requires superb systems and an excellent supply-chain.

For Lala's 11 to be really different, it will have to give its customers a great experience. People might come once to see what it is like, but the success will be dictated by repeat customers. By loyalists. The sort who'd rave about the quality of their service and what an exhilarating experience they had. How will this come about? This should be Lala's USP. Staff training could hold the key.

''The restaurant chain should leverage its status as the local pioneer in the field of fast food'' Pankaj Batra, Marketing Director, Yum! Restaurants Indian Subcontinent

It is not the strongest of a species and not the wisest that survive, but the ones that are most responsive to change
Charles Darwin

The case game talks of a fast-food chain called Lala's, but it might just as well be any chain, denoted, say, by random variable X.

Now, X obviously believes that he understands Darwin's theory of evolution. With the entry of the foreign food chains, the consumer truly has become King.

The days of 'give them any colour they want as long as it is black' are over. So, instead of fighting a losing battle, X has chosen to shift the battlefield to the latest heartthrob of youth- 'cafes'. After all, as the quotation goes, "trends, like horses, are easier to ride in any direction they are going".

And what does X have in his arsenal to woo his damsel?

• A complete understanding of how to make the business model work-real estate, supply chain economics and product development. After all, X was the local pioneer in the field of fast food.
• X offers lower prices-surely the consumer will find it hard to resist?
• X's brand has already got a reputation/equity in the market.

Clearly, X is excited at this new proposition. After all, the model works at far lower investments/sales and above all, it can be rolled-out into other towns by virtue of its simplicity.

Sorry to be a wet blanket, X, but you may be frothing at the wrong cup...

• A brand is the emotional relationship that a consumer shares with a product. And, I am afraid, many of your prospects already have a 'raging affair' going with the other café' brands. You will not have the 'first mover' advantage that you enjoyed with your first love.
• X's 11 will need to contend with the liability of a 'fuddy duddy' image, especially amongst the core users of the café concept.
• Lala's will also face the challenge of developing a new range of products that connect with the Indian consumer's taste buds better than the others. Especially since the other players also have the benefits of backward integration-cost efficiencies and a quality product.
• Lastly, X's equity is largely restricted to the boundaries of Delhi. Making inroads into cities where competition is already well entrenched, is going to be a tall task indeed.

To top it all, there are other international players with their eyes set on the same damsel. This is going to be a swayamvara where the bride will have many suitors to choose from.

So, in sum, X, get ready for the 'long haul'....

''Lala's should make the ambience youth-centric, and leverage the equity of its current brand'' Sumit Chopra, General Manager, Nirula 21

This anecdote dates back to the days when one could drive to Connaught Circus from any South Delhi colony in not more than 15 minutes-late '60s and early '70s. The favourite family outing was to this stand up fast food joint, where one had to invariably wait in line to be served. We kept going back for the sheer value and quality of the fare.

As time progressed, so did the span and the scope of the business. The growth was steady, careful to establish the brand firmly. There was a fan following, and also die-hard customers. The demands on the business kept growing and the organisation expanded to meet these in all forms-especially in the value chain. It came to being written about as a homegrown success story.

India attracted the international food behemoths in the 1990s. Thus started the exodus of the customer base to the much-hyped new flavours and tastes packaged in a fresh youthful ambience by the new entrants.

There were, of course, the old loyalists who continued their patronage of the Indian counterparts, but a large segment of free-spending youngsters made what could be termed an 'identity of self and attitude change' transition. Core values underwent a paradigm shift, and the earlier restaurants went 'Family Style'.

Much of that applies to the case game presented here. Consider the circumstances: competition is intense, and the younger generation is shunning the older values, looking for places to 'hang out' and 'be cool'.

As a result, the old restaurant chain, despite its healthy return on investment, finds that business growth is slowing down. Change is called for. The question is 'how?' The other challenge is to go national, without compromising the quality of deliverables to the customer.

The company would, one may assume, engage in market research and brainstorming with several experts, before arriving at a plausible solution. Let's say that research reveals that in the menu of the older chain, one product scores quantitatively over the others.

This product, though it has not specifically been mentioned in the case, could be ice-cream-which, manufactured under the parent brand name, could have acquired a clear edge over its competition in terms of quality and price. This is a valid point of differentiation.

So why not take this to the customer in an upmarket, contemporary, chic format? It would set itself apart, would it not?

Make the ambience youth-centric, full of energy and individualistic. Use the equity of the current brand for the creation of a new brand, which, though different in terms of packaging, also has the recall value of the earlier brand.

No mean task, but it can be accomplished successfully. Incorporate a menu that is easy to serve, has reasonably higher shelf life of products, and is well-rounded to fill the troughs in revenues from ice-cream sales in the winters.

So, here we have a sophisticated 'Ice-cream Café'. With an investment of approximately Rs 30 lakh, and with superior return on investment (ROI), we seem to be having a winner on our hands. The nationwide roll out of the concept could take place in a phased manner, with a an appropriate combination of owned, managed and franchise options.

With competitive pricing, delivery of superb quality and the customer kept firmly as the focal point of the chain's existence, the response from the consumers could be stupendous.