Disclaimer: This post explains a theoretical scenario wherein you can earn back the money you spent buying Indigo air ticket. Practical feasibility not known and reader discretion advised.
This thought was conceived when I was on Chennai-Mumbai Indigo flight 2 months ago, and perfected during Delhi-Chennai Indigo flight today. Like most of the low cost airlines, Indigo also sells food items to its passengers on board. I am only wishing that I be allowed to sell one particular item on their flight, so that I can you can earn more than what you spent on air ticket.
Ok. Without any further delay, let me come to the point. Of so many items they sell on board, ‘flavored’ cashew nut seems to be the most popular and tasty one. They sell a small packet of cashewnut for Rs 50. When I saw the packet, I was hoping it will be at least 50 gms. Only after I got one in my hands I realized that it is just 20 gms-I ended up paying 50 Rs for just 4-5 cashewnuts.
Last remembered, 100 gms of cashew nut was being sold at Rs 29 in my hometown in a kirana shop. (Some super markets in Chennai sell 50 gms for Rs 35). Now, my proposition is that I can sell better quality cashew nut, for lesser price, in higher quantity than what Indigo currently does. While Indigo sells 20 gms for Rs 50, I propose to sell 25 gms for Rs 40. Now, assuming I get a bulk purchase rate of Rs 250 per kg and other expenses of Rs 50 per kg, I can prepare 40 packets of 25gms out of 1kg at a cost of Rs 7.5 each. If I can sell them for Rs 40, I can earn Rs 32.5 per packet. Keeping a provision of Rs 2.5 for taxes, airhostess commission etc, I can earn Rs 30 per packet easily.
If I am allowed to sell them on board, on an average at least 100 passengers would buy one packet each, and I can earn a profit of Rs 3000 in one round, which is almost at par with the ticket fare for short haul destinations (Chennai-Mumbai/Bangalore-Hyderabad and such) For longer flights like Chennai-Delhi that lasts over 2.5 hours, maybe I can go for second round and sell 200 packets, earning 6000 Rs which is a decent profit above the current Indigo airfare of 5400 Rs for the journey.
Now that I’ve given the business idea, go ahead and give it a try. Let me know if you succeed.
Hello Indigo…Are you listening? I want to sell cashew nut on board your flights-please permit! (I've dropped the URL of this post as a feedback at their website-waiting to see what happens!)
This thought was conceived when I was on Chennai-Mumbai Indigo flight 2 months ago, and perfected during Delhi-Chennai Indigo flight today. Like most of the low cost airlines, Indigo also sells food items to its passengers on board. I am only wishing that I be allowed to sell one particular item on their flight, so that I can you can earn more than what you spent on air ticket.
Ok. Without any further delay, let me come to the point. Of so many items they sell on board, ‘flavored’ cashew nut seems to be the most popular and tasty one. They sell a small packet of cashewnut for Rs 50. When I saw the packet, I was hoping it will be at least 50 gms. Only after I got one in my hands I realized that it is just 20 gms-I ended up paying 50 Rs for just 4-5 cashewnuts.
Last remembered, 100 gms of cashew nut was being sold at Rs 29 in my hometown in a kirana shop. (Some super markets in Chennai sell 50 gms for Rs 35). Now, my proposition is that I can sell better quality cashew nut, for lesser price, in higher quantity than what Indigo currently does. While Indigo sells 20 gms for Rs 50, I propose to sell 25 gms for Rs 40. Now, assuming I get a bulk purchase rate of Rs 250 per kg and other expenses of Rs 50 per kg, I can prepare 40 packets of 25gms out of 1kg at a cost of Rs 7.5 each. If I can sell them for Rs 40, I can earn Rs 32.5 per packet. Keeping a provision of Rs 2.5 for taxes, airhostess commission etc, I can earn Rs 30 per packet easily.
If I am allowed to sell them on board, on an average at least 100 passengers would buy one packet each, and I can earn a profit of Rs 3000 in one round, which is almost at par with the ticket fare for short haul destinations (Chennai-Mumbai/Bangalore-Hyderabad and such) For longer flights like Chennai-Delhi that lasts over 2.5 hours, maybe I can go for second round and sell 200 packets, earning 6000 Rs which is a decent profit above the current Indigo airfare of 5400 Rs for the journey.
Now that I’ve given the business idea, go ahead and give it a try. Let me know if you succeed.
Hello Indigo…Are you listening? I want to sell cashew nut on board your flights-please permit! (I've dropped the URL of this post as a feedback at their website-waiting to see what happens!)
4 to 5 cashewnuts for Rs 50! Sounds like daylight robbery.
ReplyDeleteAlternate post title: Cashing in on Cashews :)
ReplyDeleteThat's a business blueprint. :) Hope ppl implement your plan to serve the 'nuts' better!
ReplyDelete@Mridula,
ReplyDeleteWell, I dont want to term it as robbery- If they had priced ticket fare some 200 rs higher and given this groundnut for free, probably we wouldn't have complained...
@Rajesh Kumar,
Thanks for the suggestion.
@Saithilak,
Let us see...
On the outset, this seem to be a promising business model. Fair and ethical business for sure compared to other crooked businesses that are in the news ;)
ReplyDeletethat is how all this airlines make money by selling stuff. They are forced to sell the tickets for so cheap because of competition.
ReplyDeleteI really would not call it robbery because that business. Unless they force the passengers to buy it. Of course people have option of buying it from airport as well. People have the choice.
Hmm... Interesting preposition.
ReplyDeleteThey way all the airlines have misjudged the requirements, its going to be 50 Re per cashew very soon.
Interestingly king mallya is attempting to eat into every other airline and quite sucesfull too. Hope he will not go down carrying all the weight and is bailed out from BIFR using common mans money.
cheers
mohan!
innovative ways of conning passengers ...and I read somewhere that all airlines are going to stop or reduce the supply of food on board
ReplyDelete@Mohan,
ReplyDeleteThanks.
@Goli,
Yes, As replied to Mridula, I dont call it a robbery-just a bad business approach.
@ Mohan,
Thanks, Rs 50 per cashew? let us see...
Even Malya is affected by price rise. Standby for my next post on kingfisher airlines...
@lakshmi,
It'll be good if they stop selling onboard and permit people to carry their own food...
I too agree that its business and so the cost price for selling cashews might be higher!
ReplyDeleteBTW, if you have watched movies in the multiplex in malls, the experience is no different - I watched Jaane Tu in Garuda Mall last night and here are the damages:
Ticket fare: Rs.170(being a week day, it was less!), Rs.45 for 250 ml of Coke and Rs.30 for 1L Aquafina, in addition to the parking fee of Rs.40 for 3.5 hrs!
How abt selling bottled coke and water during intervals for lesser price and reclaiming the ticket & parking fares?
PS: This is my experience in Bangalore and maynot be very different in other Indian cities.
There is discouragement for eating cashews when you're flying 30,000 feet about the ground.
ReplyDeleteWhat if you had a tummy upset in mid-air? I don't trust the airplane toilets to do justice to such scenarios.
Comments received for this post at Mouthshut:
ReplyDeletebhupeshrai said:
Jul 09, 2008 11:29 AM
hey bro
nice idea dude
so when are you going to implement it???
:)
paulose said:
Jul 09, 2008 11:37 AM
lol .. i did a similar ’business analysis’ when airhostess came to me with similar pack inflated with air, than contents inside !! .. but never thought of doing business.. i simply didnt buy, as i didnt find it worth !! .. someone in the back seat was complaining that he got only 20 ( perhaps groudnuts ) for 60Rs !!! .. i wonder why the prices shud go up just bcos the plane also goes up !!! or is keeping the price high their way of discouraging ppl from buying ?? if only they realise the point in pricing it suitably, they can increase volumes .. do let me know if indigo agrees, i am open to be ur partner ;-) lol
astrofreak1234 said:
Jul 09, 2008 11:49 AM
Shrinidhi,
Nice idea, when are going to tie up with other airlines too, don’t forget to give me a discount if I am on one of the flight ;-)
mailsukhi said:
Jul 09, 2008 11:50 AM
Hi Srinidhi,
Really enjoyed reading your review.
U floated a very good business proposition.
I am sure there will be many takers for the same.
Do update us once your business starts flourishing :-).
Take care.
Payal
jpmlore said:
Jul 09, 2008 12:58 PM
LOL...nice business proposition. We grow cashew nuts in my native place in quintals and sell it off. In case you want to buy directly from the source cutting the middle man please contact me!!.
cheers...enjoy!!!
Ashsingla said:
Jul 09, 2008 01:56 PM
Total crap. There are so many flaws in the whole analysis, that it is totally impractical..
anand_2007 said:
Jul 09, 2008 06:03 PM
hi Shrinidhi,
Good idea... at present airline people are making profit more than what you expected to earn.
they might not give chance to make profit for anyone else.
Nice idea..
vishalvkale01 said:
Jul 09, 2008 07:05 PM
Enidhi...
Incisive as ever, as I see. The same situation is with most airlines... that is the reason why I dont purchase anything on the flight beyond a cup of coffee...
Regards,
Vishal
angel25 said:
Jul 09, 2008 07:46 PM
I mean this might not be a real review...but none the less it was by far the most entertaining I have read for sometime now
Cheers
astrofreak1234 said:
7 hrs 20 mins ago
Shrinidhi,
So sweet of you to say that for me. all the best to you in your ventures :)
Tanna
@Laddoo,
ReplyDeleteThe cinema experience same everywhere. Thanks for sharing.
@Hari,
I don't see any health concern eating 4-5 cashew nuts...
I was just joking. Cashew nuts aren't as bad as they're made out to be. In fact, I love (dry) roasted salted cashews and they've not done me any harm yet.
ReplyDelete@Hari, OK.
ReplyDeleteHey,
ReplyDeleteNice little discussion we've seen here! Fun ...
The crux is pricing suitably, really. But tell u what...capitalism hasnt matured yet in India at least.
Airline managers need to just know what is a basic need and what is avoidable and price accordingly to make volumes.
Cashews, coffee, chips...comeon these are not rolls royce or bentleys that u can make ur biz targets by selling and counting on fingertips!!!
U gotta have some volume.
Lets see when they get wise?
But i'm sure theyr not gonna throw open their CAPTIVE customer base (in-flight) to bright bizmen like here :) ... same goes for multiplexes and the lot!
Have faith...Dont have Cashews :P
hmm...
ReplyDeleteYou can't survive on faith....you'll need something to munch upon...
Hi, Although your idea is thought provoking and bordering on the unusual, we must realise why the airline charges so much for a pack of cashewnuts.
ReplyDeleteWe need to consider that each packet of cashewnut's weight about 20gms? it may seem insignificant but adding say 1kg of unsold cashewnut per trip to the fuel consumed.. and the price per packet wud go up.
Also realise that LCC by their very business model would make money of ancillaries like food items
Agree on the fuel consumption part. But most of the domestic passengers travel with much lighter baggage than permissible limit. So this should compensate.
ReplyDelete