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Fast food delivers lunchtime lesson

By CNN's Becky Anderson

Lunch on the move -- Indian style.
Is the dabbawallah system replicable as a model for big business?
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MUMBAI, India (CNN) -- It's just before 9.30 in the morning in one of Mumbai's northern suburbs, and Lalitha Pisat is preparing lunch for her son. He's a resident doctor, living in a hospital in the heart of the Indian city.

Three hours later, and 60 kilometers to the south, Sanjet Pisat will be able to tuck into the food his mother has prepared.

That's thanks, in part, to Suresh, one of Mumbai's 5,000 dabbawallahs -- or packed-lunch delivery boys -- who ferry nearly 200,000 home-cooked meals from the outer suburbs into the city each day for customers like Mrs Pisat.

As he heads for the local station, Suresh is playing a small but vital role in one of the most ingenious distribution systems in the world.

The self-employed dabbawallahs, each a small-scale entrepreneur, work in groups of four in a sort of multiple relay ensuring door-to-door delivery.

The first stop for Suresh is Andheri station, where the aluminum boxes in which each lunch is carried -- or tiffins -- are sorted according to their destination and loaded onto the trains.

The dabbawallahs date back to the late 19th century when Bombay's rapidly growing population needed feeding at work. More than a century later Mumbai's middle classes still prefer their chapatis cooked at home.

But the system has aged well. Forbes magazine recently awarded it a six-sigma performance rating, which ranks the dabbahwallahs alongside the likes of GE and Motorola in terms of efficiency and quality of service.

Professor C.K. Prahalad of the University of Michigan Business School believes the dabbawallahs offer a near-perfect case study of the principles of supply chain management.

"Six sigma essentially means you can talk no errors," Prahalad told CNN.

"One-hundred and seventy-five thousand boxes are transported every day, it has to go to the right person, it has to start from a point of origination, go through transshipment in the infrastructure which is the public infrastructure in the trains of Mumbai in all seasons including the monsoon and it has to arrive on time in the right place in the right box."


Many of the dabbawallahs are semi-literate, and in a city in which many observe religious dietary rules an errant delivery could easily cause offence. To get over that, each tiffin box is color-coded and marked with simple acronyms such as HO for hospital according to its final destination.

Each box also carries a code to ensure it returns to where it started as promptly as it arrived.

There's nothing new or complicated in this supply chain model, which works much like a courier company. What makes it unique is its low capital intensity and its price performance relationship.

The tiffin box carriers rely almost entirely on local trains, benefiting from an extensive and reliable train network. Costs are low, as are wages, and that keeps the price down. It's just 3,000 rupees a month for the service -- about four dollars.

Those logistics aren't easy to replicate, but Prahalad believes there are major lessons to be learnt.

"I think logistics is becoming more and more a top management issue," said Prahalad.

"That's a good thing by itself because you can dramatically reduce the capital intensity of a business. A lot of the float there is between points of production and consumption can be reduced dramatically around the world."

Mumbai's tiffin box-carriers are already providing lessons to corporate India on leadership and efficiency, says Raghunath Medge, president of the Nutan Tiffin Box Suppliers Association.

"People study business books and then practice. Ours is the reverse. We practiced first and have now become case studies," Medge told CNN.

Back on the streets of Mumbai, our dabba is on the last leg of its trip. It's finally delivered to the canteen at St. George's Hospital just before 1230.

For Sanjet, the dabbawallahs are a godsend.

"When I come back here the after a heavy day at work -- the dabbawallah is definitely here and believe me that's really good," he told CNN.

The Bombay Stock Exchange is another big sorting center for dabbas. These days the tiffin box carriers here jostle for business with international fast food outlets such as McDonald's and Pizza Hut.

Clearly eating habits have changed and Raghuneth Medge says the market is leveling out, but for many the appeal of home-cooked food is still irresistible.

"As long as they have stomachs, people will need food and people will work only when they eat and from work they will make money," said Medge.

"As long as people need tiffins we will be there to supply them."

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