Restaurant Bigwigs Bet Big on Home Deliveries and Takeaways, Airport Retail and Promised Turnaround of Railway Stations

By Sourish Bhattacharyya

THE Indian Restaurant Congress 2014, organised for the fourth successful year by Franchise India, opened at the Vivanta by Taj in Faridabad with the overarching theme of 'Think Global, Eat Local' and the inaugural speaker, Lite Bite Foods Chairman Amit Burman, drove home the point by stating how just one innovation -- the introduction of masala papad as a side dish -- drove the per outlet sales of Punjab Grill up by Rs 2 lakh a month in Delhi/NCR.

Lite Bite Foods Chairman Amit Burman gave
an insightful start to the Indian Restaurant
Congress 2014 with his analysis of the challenges
and future growth areas of the restaurant industry.

Innovation. Consistency. Localisation. These were the buzzwords that kept coming up in the presentations by the leaders of the industry as they looked into the crystal ball to predict the trends that would define their business in the years ahead.

Burman started his talk by listing the "continual challenges" -- higher-than-ever real estate, ingredient and personnel costs -- which have confronted the industry since the past year. Food inflation peaked at 20 per cent in November 2013 and energy cost went up on average by 11 per cent, Burman added. He listed four strategies to find a way around these challenges: smart menu engineering, efficient real estate use, smart hiring and tighter cost controls.

"We earn for the government, real estate owners and banks," Burman said on a light note, adding that taxes sliced off 20 per cent of the margins of a restaurant business, and rents as well as repayment of bank loans with interest accounted for another 30 per cent. What he mentioned in passing, though, is an even bigger challenge. Indians still do not eat out as much as their counterparts in south-east Asia, for instance. Though we eat out twice as much as we used to in the recent past -- eight times a month, compared with four in the past -- we are way behind the residents of Hong Kong (3.2 times a day) and Singaporeans (41 times a month).

In this tight market, how can restaurant operators make money? For Lite Bite Foods, which has become a benchmark-setter in the restaurant retail business, the future is in airport retail, which, according to Burman, offers more consistent footfalls and growth than malls or the high street. The company is now looking at food courts at next-generation railway stations, as visualised by Prime Minister Narendra Modi, as the next big growth avenue. "More and more travellers are eating on the go," Burman pointed out.

Home deliveries and takeaways were the other growth drivers highlighted by speaker after speaker. Discussing the Yo China growth model, the 51-outlets-and-growing restaurant chain's CEO, Ashish Kapur, said that home deliveries and takeaways accounted for 40 per cent of its revenues, providing a cushion to the dine-in side of the business. A sound logic drives this mixed growth model: You're paying rent for the entire day, so why don't you make your most expensive asset sweat harder! "Maximise business, reduce transaction costs," Burman said, pointing to the obvious benefits of this mixed growth model.

K.S. Narayanan, CEO, Pan India Food Solutions, whose brands extend from Copper Chimney to Coffee Bean & Tea Leaf and Spaghetti Kitchen, made a strong pitch for "constantly innovating in the way we cook, serve, deliver and communicate". He made three points that the industry can ignore only at its peril:

* Food is very local, very culturally driven (hence, the new buzz phrase, 'eat local').

* Taste is an important driver of consumer preferences (hence, the salience of consistency).

* Consumers are becoming critics (hence, the paramount importance of communications).

Everyone talks about consistency, but it's easier said than done. For a single restaurant, it may mean, as Saurabh Khanijo, the man behind the successful trio of Kylin, Kylin Premier and Sartoria, put it: "standardisation of recipes and regular audits" to ensure that the recipes are followed without deviation. Kapur at once gave the audience a reality check.

Consistency of the quality of food that is served at a restaurant depends entirely on the consistency of supplies and the consistent quality of ingredients, which are both big challenges. The supply chain, likewise, is dependent on the efficiency of the transport network and the consistency of temperature control, which are both logistical nightmares.

Kapur said that in an ideal world, it would make economic sense to prepare at a central commissary and transport the thousands of dim sum consumed daily at the many Yo China outlets in Delhi/NCR (all that these would then require is steaming or frying once orders are placed), but this enterprise would require a "chilled chain", which is a dream in our country as we still struggle to put a cold chain in place. In an imperfect world, it's not easy to be a restaurant operator, but the growth rates are too tempting for any entrepreneur to ignore.

Italian Tops Home Delivery Food Choices; Pizza Hut, Yo! China & Nirula's Hot Favourites in Foodpanda.in Survey

By Sourish Bhattacharyya

MAMA MIA, North India is

Rohit Chadda, Co-Founder and Managing Director,
Foodpanda.in, says the survey results reflect the
cosmopolitan food choices of the website's
youth market-driven demographic 

saying 'bye, bye' to Chinese and going 'bhai, bhai' with Italian. Sounds impossible? You may have thought Indian and Chinese are the hottest favourites of the North Indian dining market, but 44.8 per cent of those who order home-delivered meals through Foodpanda.in, a Rocket Internet-incubated website operating in 40 countries across four continents, prefer Italian over Chinese, Punjabi and fast food.

Surprisingly, though, Chinese has a 27.6 per cent following, but Punjabi has slipped to as low as 6.2 per cent. The survey report doesn't give the percentage for fast food, but if you do the math, it ranks a healthy third with 21.4 per cent.

That seems highly likely in the light of the fact that Nirula's is the restaurant franchise that ranks third in popularity among Foodpanda.in users after Pizza Hut (whose thin crust and cheesy pizzas top the list of favourites) and Yo! China, a chain of popular Chinese restaurants with a strong takeaway business promoted by Ashish Kapur, Ajay Saini and Joydeep Singh.

Finding the survey results a bit hard to stomach, for they flew in the face of conventional wisdom, I called up Rohit Chadda, the young co-founder and managing director of Foodpanda.in. He was quick to point that 60 per cent of 50,000-60,000 unique visitors that the website belong to the 25-35 age group, and an equal percentage of them are from Delhi-NCR, Mumbai and Bangalore. He did not divulge the actual number of orders placed by these visitors to the website.

"Our survey results reflect the cosmopolitan nature of the taste buds of our demographic, which is essentially the youth market in the three big metros," Chadda said. Pizzas are most popular, he added, because they are "faster to deliver and easier to eat". Yo! China's Yo Boxes are also "very popular" because they are "very affordable" and offer "very good quality". The Foodpanda.in demographic clearly seeks out both affordability and quality.

With a sizeable segment of urban India, especially the young, living away from home, the takeaway and home delivery market is booming. Chadda said that whereas organised food retail grew by 20-25 per cent in 2012, the takeaway and home delivery segment rose by 40 per cent. He estimated that the segment has grown to become a Rs 1,000-crore business nationally and is poised to expand to up to Rs 6,000 crore by 2017.

"The takeaway and home delivery model offers convenience to customers because the food comes cheaper and 5-6 per cent higher margins to restaurant chains because of the reduced overhead costs," Chadda said. Unsurprisingly, significant players in the industry such as Anjan Chatterjee's Speciality Restaurants (the holding company of Mainland China) and Amit Burman and Rohit Aggarwal-promoted Lite Bite Foods are driving their takeaway and home delivery business. Even an established brand such as Kabir Advani's Berco's is popularising a hybrid growth model -- smaller restaurants with 40-50 covers and a sharp focus on home delivery. For long, we have been accustomed to a 'ghar bhijwa dena' relationship with our friendly neighbourhood kirana store. Restaurants are now getting to hear these familiar words and it's music to their ears.

As He Re-Engineers The Wine Company's Menu, Chef Saby Shares Fabrica's Business Plans

By Sourish Bhattacharyya

I WAS trying to shake off the dreariness of Delhi's weather the other day at my favourite Soda Bottle Openerwala (SBOW) at the DLF Cyber Hub in Gurgaon, when I ran into Megha Kohli, a young chef with the happiest face in the business. I had heard Megha had joined Fabrica, the new company floated by Sabyasachi 'Chef Saby' Gorai, so my newsman's antenna shot up when I saw Megha, her chef's whites showing signs of long hours in the kitchen, at the Cyber Hub.

And sure enough, I learnt that Saby had been signed up by Ashish Kapur to work on The Wine Company menu. That was music to my ears because I believe The Wine Company is a great idea -- where else can you get such decently priced wine in Delhi-NCR -- but its menu has obviously been drawn up by a person who has no clue about wines or wine pairing. You cannot have a wine-driven restaurant without a food menu to complement it. Being a good judge of market realities, Ashish seems to have figured it out soon enough and it shows in his decision to get Saby to rewrite the menu.

After leaving AD Singh, Sabyasachi
Gorai launched Fabrica with a plan to
to roll out concepts in five business
verticals. Image: Facebook

Meeting Megha and Saby's nephew, young chef Subhayan Das, outside SBOW seemed like some sort of a karmic connection at work, for the restaurant was the last project that Saby completed before quitting AD Singh's fast-expanding restaurant empire. It was a calculated risk on the part of Saby, who has found a niche for his unmistakable media persona on television (The Urban Cook on Zee Khana Khazana), but he's working according to a plan that straddles five verticals:

* Roll out middle-to-mass-market food concepts, from gourmet food carts to burger chains, in smaller cities such as Chandigarh Jaipur and Pune. Apart from these turnkey projects, Saby proposes to pursue restaurant consultancies, which he says will provide him "bread and butter" and the wherewithal to grow his business organically. His dream is to create a chain of gourmet stores with restaurants and lecture kitchens on the lines of Eataly, the brainchild of the Italian electronics retailer, Oscar Farinetti.

* Launch a culinary college to produce qualified chefs who will be trained to cater to the burgeoning restaurant industry and its increasingly international standards. Saby is in final stages of talks with a private university in Delhi-NCR and the project is likely to be bankrolled by the scion of an old business house with a growing interest in restaurant concepts. A top equipment maker is developing what promises to be the country's most modern catering college kitchen.

* Create a two-way employment exchange for chefs -- both Indians looking for better openings or jobs abroad and international chefs scouting for career breaks outside their countries. This is one vertical the country badly needs. I wish Saby pays attention to the critical area of training stewards as well!

* Sign up as brand ambassador of food and kitchen accessories brands. This is one good idea, for apart from Sanjeev Kapoor, Vikas Khanna, Ritu Dalmia and Saby (for the upscale German kitchen and household utilities brand, Miele), marketers rarely consider chefs as brand ambassadors in verticals where their world should be the law. If Saby succeeds, he'll give chef-shy food and kitchen appliances brands the courage to bank on chefs. Because Saby, unlike the other three, who became media personalities before they got brand ambassadorships, did not have a television show before he signed up with Miele.

* And last (this one is what I find is most exciting), create a range of 'sprinkle-ons', or cooked powders that you can adds to your food to get a curry kick, for a Japanese marketing agency. Imagine you are having a medium-done steak and you get the urge to sex it up with a balchao flavour, and all you need to do is pick up a sprinkler filled with balchao powder. Saby dreams of the day when these sprinkler would become as common as Tabasco and Capsico at homes and in restaurants.

Dreams have the power to drive you closer to reality. Saby should know this better than most of his other peers.

Where Will You Find Soda Bottle Openerwala & The Wine Company?

By Sourish Bhattacharyya

SODA Bottle Openerwala must be the most unusually attractive name that anybody could have come up for a restaurant and AD Singh has done exactly that for his Irani café slated to open at The Hub in a couple of months. But his is not the only concept restaurant that awaits the opening of The Hub, the country’s first ‘food mall’ conceptualised by DLF at its Cyber Park in Gurgaon.

Yo! China-dimsumbros duo Ashish Kapur and Ajay Saini, who have sold over 10 million dim sum at more than 50 locations across 14 cities, are making their first foray into ‘wine dining’, graduating from the mass to the class market with The Wine Company. It will be the country’s first wine-centric restaurant located in a wine shop. You’ll have to buy your bottle of wine and then get your meal paired with it. And of course, there’ll be sangria flowing like water. Kapur and Saini promise to rid wine drinking of the high prices and the stuffiness associated with it. Their price, they say, will be the lowest in Delhi-NCR. It’s nice to know there’s one restaurant that doesn’t want to squeeze the wine lover.

The other notable brands at The Hub will be Stryker, without doubt one of the most successful hangouts in the city, in the avatar of Soi 7; the seriously competing Made in Punjab and Dhaba by Claridges; Canton Spice Company of Baba Ling, the teddy bear-like popular owner of Nanking (in my opinion the best Chinese restaurant in Delhi-NCR); and the redoubtable Panchavati Gaurav, which will be the first foray into Delhi-NCR of the much-acclaimed chain of thali restaurants serving predominantly Rajasthani fare in malls across Mumbai, Pune, Nagpur, Sangamner (in Ahmadnagar district), Raipur and Jabalpur. Interestingly, it shares the wall of The Wine Company. An unusual act of cultural engineering by DLF! Other names to look out for are Hard Rock Café, Nando’s, Starbucks and California Pizza Kitchen.

The Hub will also have a food court with the usual fare — McDonald’s et al — but the real action will in the floors with the stand-alone restaurants. Gurgaon couldn’t have asked for a better treat and Delhi of course will be digging in.