Ajay Kaul is hungry for time. The 45-year-old CEO of Jubilant FoodWorks, the master franchise for Domino's Pizza in India, looks constantly at his watch, the ticking minutes whetting his appetite. And it figures: Kaul's pizzas have to reach customers in 30 minutes and he wants to open more than 60 new outlets every year.
As he launched Jubilant's 300th outlet in Delhi's Pitampura last month, Patrick Doyle, the global CEO of Domino's Pizza Inc, said, "Our teams in India and Louisiana, USA, are two of the largest and best franchisees." At a growth rate of nearly 42 per cent for the last five years, the company's India operations are its fastest in the world.
Doyle's and Kaul's appetite for India is shared by competitors. Whether it is multinational chains like McDonald's, Pizza Hut, KFC or homegrown ones like Sagar Ratna, Yo! China, Haldiram's, Bikanervala or Nirula's, they are all racing to open new restaurants. McDonald's, which had 20 outlets in India till 2002, has 187 today. It plans to open 200 more over five years with an investment of Rs 500 crore. Yum! Restaurants, owner of the KFC and Pizza Hut brands, plans to add 15 and 20 outlets respectively.
The story is repeated across the road with Nirula's looking to add 120 new points of presence, Sagar Ratna 35 new outlets by December and Delhi-based Bikanervala and Haldiram's four-five new outlets every year. Even traditional entities like the Bangalore-based MTR Restaurant and the Chennai-based Murugan Idli Shop (MIS) are looking at Delhi and Mumbai, "for the first time in 80 years", according to Hemamalini Maiya, managing partner, MTR Restaurants.
The temptation was just too hard to resist. Maiya says expanding beyond Bangalore is something her late father (who started the restaurant) would never have approved of, but that makes clear business sense. After all, says Gaurav Marya, president, Franchise India, "India is the biggest consumption market in the world." Even chains like Dunkin' Donuts, Popeyes Chicken, Pizza & Co, Swensen's and Burger King are in talks with local partners to enter India.
The eating out market is on an upswing. The rising number of working women and nuclear households, and an increase in general affluence have led to higher discretionary spending on food. According to the Food Franchising Report 2009, 30 per cent of working singles eat out at least once a month, with a majority spending at least Rs 101-150 per outing. Urban Indians now have a repast outdoor six times a month compared to 2.7 times in 2003. Retail consultancy Tech-nopak Advisors says the spend on eating out at 11 per cent is second only to groceries for Indian households.
Even investors are turning to fast food companies. Jubilant FoodWorks' successful IPO in January, where it raised Rs 329 crore, was oversubscribed 31 times. In March, Cafe Coffee Day raised over $200 million (Rs 920 crore) from three private equity funds. "These are very sizeable investments," says Raghav Gupta, president, Technopak Advisors, "and reflect a sense of confidence."
Growth isn't the only change in the food business. The shift from unorganised or street food towards a cleaner, more hygienic environment is one, even as the proliferation of stalls selling steamed corn, doughnuts and even sushi across malls, along with the success of South Indian cuisine in Delhi and butter chicken in the South shows that Indians are willing to experiment. "Even in Chennai, 40 per cent of my customers are north Indians," says S. Manoharan, proprietor, MIS. He plans to have a franchise outlet in Delhi in the next one year.
In the 90s, global fast food firms placed their bets on India, hoping to hook locals on Western food. Yum! entered India with KFC in Bangalore in 1995, but got mired in controversy. Having put that behind, the company worked towards expanding its base and today owns over 60 outlets. KFC has also tailored some dishes for Indian tastes. There's chicken tikka masala pizza, zinger burger, chana crunch snacker, veg pulao and makhni curry, and the recently launched nimbu crushers.
"One of the biggest questions is whether restaurants can localise as every region of India has a different taste," says B. Narayanaswamy, president, Ipsos Indica Research. Selling ethnic food on a national scale hasn't been easy in a country historically used to a variety of dishes. However, localising is not only about the palate, but also about pricing. "Value is a big point," says Gupta. "Compared to a basic burger, if you get say a thali for Rs 50, people will opt for that." To counter that, Domino's re-launched its 'Pizza Mania' offer, serving pizzas at Rs 35.
Clearly, India is not all about pizza and burgers. Ethnic Quick Service Restaurant (QSR) chains too have a huge following. However, unlike their Western counterparts, home grown chains have largely been restricted to specific regions. Haldiram's, for instance, is planning to expand first in and around the NCR region. "That itself can absorb 10-15 more restaurants. Later we will look at Amritsar, Ludhiana and Chandigarh, areas we are familiar with," says A.K. Tyagi, president of its FMCG business.
Going national isn't easy. "All McDonald's burgers taste the same. How many restaurants can do that with a thali" says Gupta. The issue is one of "huge logistics", says Maiya, who has just hired a food technologist. For instance, making dosa batter and preserving it is a huge challenge. Moreover, raw materials are usually procured from one source, over generations. MTR procures its rice from a particular shop. To change that for Delhi or Mumbai would mean changing the entire methodology, as the different rice would taste different.
"Many of my customers have breakfast in Chennai and supper in Singapore," says Manoharan, "they expect the same taste everywhere."
While MNCs have professionalised their back-end through centralised commissaries, where food is merely assembled, Sandeep Kohli, founder of NCR-based Orange Hara chain of restaurants, says that the back-end of many restaurants is primitive, almost like a "big halwai shop". Instead, the food business should be technology- and process-driven. Even family-run chains are now waking up to 'heat and eat'.
But all that belongs to the first phase of establishing the brand and looking at growth. Today, most food brands have moved into phase II, which is penetration. Phase III is marked by the saturation point, where companies may need to overhaul menus, at least partially, and innovate. Much of the second phase growth will come from tier II and III cities where eating out is still an occasion.
Says Vikram Bakshi, MD, McDonald's India and franchisee for the North and East regions, "We don't plan to tweak our menu too much. Now we will grow to new areas and increase our concentration in areas where we are less spread." The response from tier II and III cities is overwhelming. Last year the company opened an outlet in Amritsar. Consultants said it was a city which loved Punjabi food, so the company opted for a smaller, 100-cover set-up. Six months later, Bakshi feels a second restaurant is needed.
The other thing is catching 'em young. Fast food chains are targeting consumers early so that they stay for 15-20 years. Ask Panipat's Nidhi and Uday Nath. Earlier they would eat out at the local sit-down restaurants over weekends, the few entertainment options available in the city. Today their choice of dining is largely driven by their five-year-old daughter Tara. So the couple ends up giving in to what has become a near-standard experience among parents world over: McDonald's.
"The children like it, so we end up coming here at least once a week," says Nidhi. "This is a generation that has grown up on McDonald's," says Purnendu Kumar, associate vice president, Technopak Advisors. But that too reflects the lifestyle changes that have taken place over the last decade.
That may not always translate into numbers for the companies. For instance, three years have passed since the opening of the first McDonald's outlet at Panipat, which was something of a mini cultural spectacle where families lined up to have their pictures taken with Ronald McDonald, but the outlet itself is a laggard in terms of sales.
Bakshi has an explanation for that. Indians eat out far less frequently than other nationals. "Even in urban homes, eating out is seen as an occasion or an indulgence," he says. Compared to this, countries in South Asia have always had the concept of eating out, either at restaurants or pavement stalls. In Bangkok, people eat out an average 44 times a month, while in Jakarta the frequency is 14-15 times. However, with that changing, companies are more bullish. Says Kaul, "While China had been growing at 5-10 stores a year, the explosion of growth in India is far more recent. In the next five-seven years, we will take our count from 296 to 700 stores."
With changing lifestyles of young Indians, also comes another opportunity for growth. Catching the consumers where they are. This means the growth of travel retail. After malls, fast food eateries are targeting airports, highways, railway stations, corporate parks, clubs, fuel stations, etc. "With limited time, customers need to be tapped wherever they go," says Niren Choudhary, MD, Yum! Restaurants India. The company has set up express delivery counters at airports. Even Sagar Ratna is exploring an express model by next year, says CFO K.S. Suresh. "Currently two people spend an average 30 minutes in the restaurant. This will reduce the time to 12 minutes approximately." Home delivery is another big area, growing at 15-20 per cent.
But the fast food retail industry is faced with many hurdles, too. The main pain point is the high cost of real estate. Add to that rising input costs; companies claim their margins are getting squeezed. While the global standard is 10-15 per cent of sales as rentals, in India it goes as high as 20-25 per cent. Says Narayanaswamy, "QSRs follow a revolving door concept, which is come, buy and leave. But India has more of a dine-in culture, which adds to the real estate costs." Kaul says that most of the new Domino's outlets, especially in tier II and III cities, come with a dining area.
"It's a business of patience, not one of making money," says Shyam Sunder Aggarwal, MD, Bikanervala. When that is perfected, there are changing customer preferences to deal with. As consumers taste global cuisine, they want the real thing here. Ask Ashish Kapur, founder of Yo! China. Before Yo! came along in 2003, no one had been successful at doing a fast food Chinese restaurant. Changing tastes and dipping footfalls, however, forced them to change their look and feel, which is a more upscale casual dining kind of restaurant.
"Seven years ago we were serving dimsums and combos," he says, "today it is more khau suey (ingredients served separately) and sizzlers and claypots that people want." Having changed helped. Today their footfalls are up 35 per cent. Kapur also something else going for him: a bit of diversity. Needless to say, customers are 'lovin' it'.
Tags:Fast Food Franchise, Fast Food Franchise,Restaurant Franchise, McDonalds, Haldirams, Bikanervala,Nirulas,Sagar Ratna, Dominos,Yo China,Murugan Idli Shop,MTR, Donkin Donuts,Popeyes,Burger King,Food Franchising,
Source:India Today, Nandini Vaish.
Showing posts with label Dominos. Show all posts
Showing posts with label Dominos. Show all posts
Sunday, May 16, 2010
Monday, May 10, 2010
India Domino's Fastest Growing Franchise Market.Celebrates 9000 Franchisees Worldwide.
New Delhi store part of Domino’s 9K celebration
ANN ARBOR, Mich. – Domino’s Pizza celebrated opening its 9,000 store with two symbolic openings earlier this year: one in New Delhi, India and the other in New Orleans.
Founded in 1960 and marking its 50th year in business, Domino's Pizza is the second largest pizza chain in the world and the company marked the opening of its 8,000th store in 2006 in similar fashion, with symbolic openings in Chicago, Ill., and in Panama City, Panama.
“For half a century, Domino’s Pizza has been able to grow and thrive thanks to the dedication and efforts of franchisees and team members the world over, as demonstrated by our franchisees in India and Louisiana,” said Domino’s Chief Executive Officer J. Patrick Doyle. “These are two of the largest and best franchise organizations in our system, and it’s appropriate that they are sharing in this distinction.
“Opening our 9,000th store is a great milestone,” Doyle added. “And we’re looking toward one of the goals we set some time ago: we want to clip the ribbon on our 10,000th store within the first half of this decade. We are looking forward to making that happen.”
Jubilant FoodWorks Ltd, the master franchisee for Domino’s Pizza in India, marked a milestone of its own with the opening of its store: it is the company’s 300th in that country. Doyle, along with Executive Vice President of Domino's Pizza International Michael Lawton and Executive Vice President of Communication & Investor Relations Lynn Liddle, joined master franchisee Hari Bhartia and Jubilant FoodWorks President Ajay Kaul and others at a ribbon-cutting ceremony, followed by a press conference and the donation of products to feed 4,500 underprivileged children in the local community of Pitampura, a residential neighborhood in north New Delhi.
Jubilant FoodWorks Ltd. is Domino's fastest-growing franchise, having opened approximately 65 stores in the last year.
“Today is a historical moment for Domino's Pizza India,” said Hari Bhartia, co-chairman of Jubilant FoodWorks. “We started our journey in India in 1996 with the opening of our first store in Delhi. With the opening of 300th store, we have come a long way in this fulfilling journey creating new milestones and benchmarks for ourselves and for the rest of QSR industry to follow. We have pioneered organized QSR and pizza retail in India. We also introduced and built the concept of home delivery in India. But we believe this is still the beginning as the Indian market has a very large potential.”
The New Orleans store was opened by RPM Pizza LLC, the company is Domino’s largest U.S. franchisee with 135 locations. The store was opened on Chef Menteur Highway, one of the areas decimated by Hurricane Katrina in 2005. The new free-standing store will be “hurricane ready” with generators, an extra-large cooler and the ability to reopen quickly to serve citizens of the community.
“Our franchise is closing in on its 30th anniversary and we have remained committed to being there when our communities need it most,” said Glenn Mueller, president of RPM Pizza. “We’ve always sought to have ours be the last restaurants to close and the first to open in times of great need. Opening a new store in this neighborhood is one more step toward rebuilding this great city. Domino's Pizza was the first chain to offer pizza delivery service and now Domino's is the first to service all areas of metro New Orleans.”
Mueller noted that RPM Pizza plans to hire nearly 100 additional employees throughout the New Orleans area.
Founded in 1960 and headquartered in Ann Arbor, Mich., Domino’s Pizza operates a network of 9,000 franchised and company-owned stores in the United States and over 60 international markets. The Domino's Pizza had global retail sales of over $5.6 billion in 2009, comprised of nearly $3.1 billion domestically and over $2.5 billion internationally.
Source:Indus News Wire
Tags:Domino's, Dominos, Pizza Franchise, Fast Food Franchise, Mexican Restaurant Franchise, best franchise, Master Franchise, franchise chain, franchise expansion, franchise recruitment.
ANN ARBOR, Mich. – Domino’s Pizza celebrated opening its 9,000 store with two symbolic openings earlier this year: one in New Delhi, India and the other in New Orleans.
Founded in 1960 and marking its 50th year in business, Domino's Pizza is the second largest pizza chain in the world and the company marked the opening of its 8,000th store in 2006 in similar fashion, with symbolic openings in Chicago, Ill., and in Panama City, Panama.
“For half a century, Domino’s Pizza has been able to grow and thrive thanks to the dedication and efforts of franchisees and team members the world over, as demonstrated by our franchisees in India and Louisiana,” said Domino’s Chief Executive Officer J. Patrick Doyle. “These are two of the largest and best franchise organizations in our system, and it’s appropriate that they are sharing in this distinction.
“Opening our 9,000th store is a great milestone,” Doyle added. “And we’re looking toward one of the goals we set some time ago: we want to clip the ribbon on our 10,000th store within the first half of this decade. We are looking forward to making that happen.”
Jubilant FoodWorks Ltd, the master franchisee for Domino’s Pizza in India, marked a milestone of its own with the opening of its store: it is the company’s 300th in that country. Doyle, along with Executive Vice President of Domino's Pizza International Michael Lawton and Executive Vice President of Communication & Investor Relations Lynn Liddle, joined master franchisee Hari Bhartia and Jubilant FoodWorks President Ajay Kaul and others at a ribbon-cutting ceremony, followed by a press conference and the donation of products to feed 4,500 underprivileged children in the local community of Pitampura, a residential neighborhood in north New Delhi.
Jubilant FoodWorks Ltd. is Domino's fastest-growing franchise, having opened approximately 65 stores in the last year.
“Today is a historical moment for Domino's Pizza India,” said Hari Bhartia, co-chairman of Jubilant FoodWorks. “We started our journey in India in 1996 with the opening of our first store in Delhi. With the opening of 300th store, we have come a long way in this fulfilling journey creating new milestones and benchmarks for ourselves and for the rest of QSR industry to follow. We have pioneered organized QSR and pizza retail in India. We also introduced and built the concept of home delivery in India. But we believe this is still the beginning as the Indian market has a very large potential.”
The New Orleans store was opened by RPM Pizza LLC, the company is Domino’s largest U.S. franchisee with 135 locations. The store was opened on Chef Menteur Highway, one of the areas decimated by Hurricane Katrina in 2005. The new free-standing store will be “hurricane ready” with generators, an extra-large cooler and the ability to reopen quickly to serve citizens of the community.
“Our franchise is closing in on its 30th anniversary and we have remained committed to being there when our communities need it most,” said Glenn Mueller, president of RPM Pizza. “We’ve always sought to have ours be the last restaurants to close and the first to open in times of great need. Opening a new store in this neighborhood is one more step toward rebuilding this great city. Domino's Pizza was the first chain to offer pizza delivery service and now Domino's is the first to service all areas of metro New Orleans.”
Mueller noted that RPM Pizza plans to hire nearly 100 additional employees throughout the New Orleans area.
Founded in 1960 and headquartered in Ann Arbor, Mich., Domino’s Pizza operates a network of 9,000 franchised and company-owned stores in the United States and over 60 international markets. The Domino's Pizza had global retail sales of over $5.6 billion in 2009, comprised of nearly $3.1 billion domestically and over $2.5 billion internationally.
Source:Indus News Wire
Tags:Domino's, Dominos, Pizza Franchise, Fast Food Franchise, Mexican Restaurant Franchise, best franchise, Master Franchise, franchise chain, franchise expansion, franchise recruitment.
Thursday, January 28, 2010
Franchise is the best way to BE YOUR OWN BOSS
“Franchise Opportunities – Be your own Boss”
FRANCHISE: A form of business organization in which a firm which already has a successful product or service (the franchisor) enters into a continuing contractual relationship with other businesses (franchisees) operating under the franchisor's trade name and usually with the franchisor's guidance, in exchange for a fee. A franchise is a right granted to an individual or group to market a company's goods or services within a certain territory or location. Some examples of today's popular franchises are McDonald's, Nakshatra, Subway, Domino's Pizza, and the UPS Store. An individual who purchases and runs a franchise is called a "franchisee." The franchisee purchases a franchise from the "franchisor." The franchisee must follow certain rules and guidelines already established by the franchisor, and the franchisee has to pay an ongoing franchise royalty fee, as well as an up-front, one-time security fee to the franchisor. Franchising has become one of the most popular ways of doing business in today's marketplace.
History: Franchising began back in the 1850's when Isaac Singer invented the sewing machine. In order to distribute his machines outside of his geographical area, and also provide training to customers, Singer began selling licenses to entrepreneurs in different parts of the country. In 1955 Ray Kroc took over a small chain of food franchises and built it into today's most successful fast food franchise in the world, now known as McDonald's. McDonald's currently has the most franchise units worldwide of any franchise system. Today, franchising is helping thousands of individuals be their own boss and own and operate their own business. Franchising allows entrepreneurs to be in business for themselves, but not by themselves. There is usually a much higher likelihood of success when an individual opens a franchise as opposed to a mom and pop business, since a proven business formula is in place. The products, services, and business operations have already been established.
Advantages: Corporate image, brand name recognition, established market, set standards of operations & training, set instructed infrastructure, off course a better chance of success and immensely profitable venture.
Disadvantages: limited ownership, ongoing cost franchise fees & percentage of your franchise’s business revenue, additional charge such as cost of advertising, besides most well known franchises are too expensive.
Different types of Franchising: There are many different types of franchise ownership opportunities. You may choose to become a multi-unit franchise owner, an area developer or you may decide to buy an existing franchise. Each ownership opportunity has its own unique responsibilities. The following is a list of the many different ownership opportunities franchising offers. 1) Single Unit Franchise: It is the most likely place a brand new entrepreneur would begin, as the franchisee would be responsible only for running one unit, although he or she would extremely involved with all the daily operations of the business. 2) Multi-Unit Franchise: multiple units are sold at a reduced rate per unit by the franchisor. 3) Area Developer: area development is similar to multi-unit franchising; the only difference is that it typically involves greater number of outlets encompassing a larger geographic territory. 4) Master Franchise: allows people or corporations to purchase the rights to sub-franchise within a certain territory. A master franchisee helps the overall franchise company by recruiting franchisees to open units within a specific territory. One master franchise is for one state only. 5) Buying an Existing Franchise: many franchise owners decide to sell their franchises after they have opened.
Approach: One need not to surprise if the franchisor questions include detail information about the proposer and his spouse financial position, experience, background, and even aspirations, questions designed to help the franchisor determine whether or not the kind of person he or she feels will be able to run the business successfully and fit into the franchise model. The franchisor will continue to explore interest, commitment and suitability of the proposer. If the franchisor decides a suitable franchisee, he will be offered a franchise contract that lays out the obligations of both parties. Like any other contract, some aspects of it may be open to negotiation. And like any other contract, if there are any promises made about the franchisor/franchisee relationship that are not in the franchise contract, get them written in. One must consult an advocate before signing the contract. Buying a franchise is like buying any other kind of business. An entrepreneur has an opportunity to startup from Rs.10, 000/- in education to Rs 01 crore in jewellery as an initial investment in India. Naming few companies extending franchise opportunities; Levi's, Peter England, Belmonte, D'damas, Nakshatra, Kidzee, Eurokids,Amson, BodySpa, MovieMart, Silversand etc
Source:http://thirdeye-raghvendra.blogspot.com/2010/01/franchise-be-your-own-boss.html
Raghvendra, Jodhpur, Rajasthan
FRANCHISE: A form of business organization in which a firm which already has a successful product or service (the franchisor) enters into a continuing contractual relationship with other businesses (franchisees) operating under the franchisor's trade name and usually with the franchisor's guidance, in exchange for a fee. A franchise is a right granted to an individual or group to market a company's goods or services within a certain territory or location. Some examples of today's popular franchises are McDonald's, Nakshatra, Subway, Domino's Pizza, and the UPS Store. An individual who purchases and runs a franchise is called a "franchisee." The franchisee purchases a franchise from the "franchisor." The franchisee must follow certain rules and guidelines already established by the franchisor, and the franchisee has to pay an ongoing franchise royalty fee, as well as an up-front, one-time security fee to the franchisor. Franchising has become one of the most popular ways of doing business in today's marketplace.
History: Franchising began back in the 1850's when Isaac Singer invented the sewing machine. In order to distribute his machines outside of his geographical area, and also provide training to customers, Singer began selling licenses to entrepreneurs in different parts of the country. In 1955 Ray Kroc took over a small chain of food franchises and built it into today's most successful fast food franchise in the world, now known as McDonald's. McDonald's currently has the most franchise units worldwide of any franchise system. Today, franchising is helping thousands of individuals be their own boss and own and operate their own business. Franchising allows entrepreneurs to be in business for themselves, but not by themselves. There is usually a much higher likelihood of success when an individual opens a franchise as opposed to a mom and pop business, since a proven business formula is in place. The products, services, and business operations have already been established.
Advantages: Corporate image, brand name recognition, established market, set standards of operations & training, set instructed infrastructure, off course a better chance of success and immensely profitable venture.
Disadvantages: limited ownership, ongoing cost franchise fees & percentage of your franchise’s business revenue, additional charge such as cost of advertising, besides most well known franchises are too expensive.
Different types of Franchising: There are many different types of franchise ownership opportunities. You may choose to become a multi-unit franchise owner, an area developer or you may decide to buy an existing franchise. Each ownership opportunity has its own unique responsibilities. The following is a list of the many different ownership opportunities franchising offers. 1) Single Unit Franchise: It is the most likely place a brand new entrepreneur would begin, as the franchisee would be responsible only for running one unit, although he or she would extremely involved with all the daily operations of the business. 2) Multi-Unit Franchise: multiple units are sold at a reduced rate per unit by the franchisor. 3) Area Developer: area development is similar to multi-unit franchising; the only difference is that it typically involves greater number of outlets encompassing a larger geographic territory. 4) Master Franchise: allows people or corporations to purchase the rights to sub-franchise within a certain territory. A master franchisee helps the overall franchise company by recruiting franchisees to open units within a specific territory. One master franchise is for one state only. 5) Buying an Existing Franchise: many franchise owners decide to sell their franchises after they have opened.
Approach: One need not to surprise if the franchisor questions include detail information about the proposer and his spouse financial position, experience, background, and even aspirations, questions designed to help the franchisor determine whether or not the kind of person he or she feels will be able to run the business successfully and fit into the franchise model. The franchisor will continue to explore interest, commitment and suitability of the proposer. If the franchisor decides a suitable franchisee, he will be offered a franchise contract that lays out the obligations of both parties. Like any other contract, some aspects of it may be open to negotiation. And like any other contract, if there are any promises made about the franchisor/franchisee relationship that are not in the franchise contract, get them written in. One must consult an advocate before signing the contract. Buying a franchise is like buying any other kind of business. An entrepreneur has an opportunity to startup from Rs.10, 000/- in education to Rs 01 crore in jewellery as an initial investment in India. Naming few companies extending franchise opportunities; Levi's, Peter England, Belmonte, D'damas, Nakshatra, Kidzee, Eurokids,Amson, BodySpa, MovieMart, Silversand etc
Source:http://thirdeye-raghvendra.blogspot.com/2010/01/franchise-be-your-own-boss.html
Raghvendra, Jodhpur, Rajasthan
Tuesday, December 29, 2009
Worlds Finest Food Franchise Companies In India
BANGALORE: Amit Burman, vice-chairman of Dabur India, never thought that a casual stroll down one of south Delhi’s upcoming localities would
provide an idea for a unique business opportunity.
In 2006, the US-returned Burman and his friend Rohit Aggarwal were in Saket, standing outside one of the outlets of the international chain, Subway. The place was crowded, with people, especially in the 18-35 age group, buzzing in and out constantly. Burman and Aggarwal paused their conversation and wondered if there was a business opportunity here.
“Franchising Subway began as a hobby,” Burman says laughing. In the initial months, the team had to work on creating the sandwich category and tailoring it to local tastes. The classic cold-cut turkey and tuna subs had to share space with chicken tikka and chicken seekh kabab fare. “People were very doubtful about the venture and would ask if I planned to make sandwiches all my life,” jokes Burman.
He needn’t have worried. In three years, Burman’s Lite Bite Foods has become Subway’s largest franchisee in India. The company operates 40 quick- service restaurant (QSR) outlets and has added other international brands apart from Subway to its menu. Street Foods of India serves roti-kababs and rajma-chawal though kiosks, bakery cafe Bakers Street at airports, Pino’s Pasta Pizza and Rapps. It will also franchise US-based fried chicken brand Pollo Campero in the next few months. “We intend to become a restaurant chain with 200 outlets, including 30 QSRs, in three years,” he added.
Consumers’ growing penchant for eating out and taking quick meals in between long working hours has spawned a boom in the Indian QSR industry. Across the country, businessmen are either venturing into QSR market on their own or through franchisee tie-ups with foreign chains such as Domino’s and Papa John. Unlike fine dining restaurants, QSRs largely operate through smaller self-service outlets that provide value-for-money food that can also be consumed while on the go. It is estimated to be worth about Rs 2,500 crore and is growing at 30-40% annually.
Bangalore, which is a favoured choice for many people to open restaurants, has also seen an explosion in the number of QSRs in the recent past. This includes Spencer’s Retail’s Au Bon Pain, Global Franchisee Architects’s Cream and Fudge Factory and Donut Baker as well as Italian coffee brand Caffe Pascucci. US chain Melting Pot is ready to invest $5-$7.5 million in the Indian market by 2010.
“Many international franchise food brands are successfully operating in the country and these success stories have sent positive signals to other US franchisors to actively look at India for expansion,” said US Consulate’s principal commercial officer, Aileen Crowe Nandi. The consulate recently held a programme to introduce Indian entrepreneurs to American fast-food outlets such as CKE Restaurants, Round Table Pizza, Tropical Sno, Melting Pot and Church’s Chicken.
QSR segment operates on a high volume-low margin business model. Not only does it focus on delivering products with speed within high footfall areas but its ability to push sales even in recent months by tapping into captive audiences at malls, educational institutions and airports through evolving formats such as kiosks, drive-ins or even take-away joints has been critical.
“India offers tremendous opportunity due to its sheer size which will see the Papa John’s outlets quadruple to 100 in four years,” said Tapan
Vaidya, general manager, restaurant division, of the Jawad Business Group—the franchisee for pizza take-away chain Papa John’s in India and Middle East.
International brands are not the only ones to cash in on this trend. Local entrepreneurs have jumped into the fray with different concepts and ideas. Sunil Cherian, who runs the Chennai-based Burgerman is one such. Burgerman’s core business proposition is to offer 25 burger variants within a 25 sq ft kiosk. With 50 outlets in Chennai and 30 in Bangalore by the month-end, the chain has tied up with retail chains to grab captive consumers at Big Bazaar, Foodworld, Nilgiris or even HPCL and BPCL.
BuddyChef, which comes from the stables of Pune’s organic farming firm Orgreen, aims to sell pre-cooked Indian and Chinese meals under $1 across every pin code. With seven outlets across Pune, it is selling 5,000 meals a day across the counter to working couples, students and small offices.
Franchising has been a catalyst in fuelling the QSR concept in India. Sanjesh Thakur, Ernst & Young’s associate director, retail & consumer products practice, says that around 17% of the F&B outlets within the organised sector are operated through franchisees and over 30% of the upcoming outlets are projected to be based on this model.
The QSR trend was kicked off by the likes of McDonald’s and Yum! Restaurant’s KFC, which began operations in the 1990s. “Since the market opened up in the ‘90s, consumer habits including eating-out behaviour has gradually undergone a change,” said KFC India’s marketing director Unnat Varma. KFC added 27 outlets last year taking its total count to 72.
All this growth needs money and investors have started opening their purses to the industry.
Bangalore-based East West Ethnic Foods, the holding company of wraps chain Kaati Zone which is adding 100 outlets by next fiscal across Maharashtra, is in talks with two-three private equity players to raise between Rs 12-15 crore.
It received its first round of funding from Accel Partners India, Draper Investment company and the founder of Helion Ventures, Ashish Gupta.
Source:30 Dec 2009, 0006 hrs IST, Sarah Jacob, ET Bureau
provide an idea for a unique business opportunity.
In 2006, the US-returned Burman and his friend Rohit Aggarwal were in Saket, standing outside one of the outlets of the international chain, Subway. The place was crowded, with people, especially in the 18-35 age group, buzzing in and out constantly. Burman and Aggarwal paused their conversation and wondered if there was a business opportunity here.
“Franchising Subway began as a hobby,” Burman says laughing. In the initial months, the team had to work on creating the sandwich category and tailoring it to local tastes. The classic cold-cut turkey and tuna subs had to share space with chicken tikka and chicken seekh kabab fare. “People were very doubtful about the venture and would ask if I planned to make sandwiches all my life,” jokes Burman.
He needn’t have worried. In three years, Burman’s Lite Bite Foods has become Subway’s largest franchisee in India. The company operates 40 quick- service restaurant (QSR) outlets and has added other international brands apart from Subway to its menu. Street Foods of India serves roti-kababs and rajma-chawal though kiosks, bakery cafe Bakers Street at airports, Pino’s Pasta Pizza and Rapps. It will also franchise US-based fried chicken brand Pollo Campero in the next few months. “We intend to become a restaurant chain with 200 outlets, including 30 QSRs, in three years,” he added.
Consumers’ growing penchant for eating out and taking quick meals in between long working hours has spawned a boom in the Indian QSR industry. Across the country, businessmen are either venturing into QSR market on their own or through franchisee tie-ups with foreign chains such as Domino’s and Papa John. Unlike fine dining restaurants, QSRs largely operate through smaller self-service outlets that provide value-for-money food that can also be consumed while on the go. It is estimated to be worth about Rs 2,500 crore and is growing at 30-40% annually.
Bangalore, which is a favoured choice for many people to open restaurants, has also seen an explosion in the number of QSRs in the recent past. This includes Spencer’s Retail’s Au Bon Pain, Global Franchisee Architects’s Cream and Fudge Factory and Donut Baker as well as Italian coffee brand Caffe Pascucci. US chain Melting Pot is ready to invest $5-$7.5 million in the Indian market by 2010.
“Many international franchise food brands are successfully operating in the country and these success stories have sent positive signals to other US franchisors to actively look at India for expansion,” said US Consulate’s principal commercial officer, Aileen Crowe Nandi. The consulate recently held a programme to introduce Indian entrepreneurs to American fast-food outlets such as CKE Restaurants, Round Table Pizza, Tropical Sno, Melting Pot and Church’s Chicken.
QSR segment operates on a high volume-low margin business model. Not only does it focus on delivering products with speed within high footfall areas but its ability to push sales even in recent months by tapping into captive audiences at malls, educational institutions and airports through evolving formats such as kiosks, drive-ins or even take-away joints has been critical.
“India offers tremendous opportunity due to its sheer size which will see the Papa John’s outlets quadruple to 100 in four years,” said Tapan
Vaidya, general manager, restaurant division, of the Jawad Business Group—the franchisee for pizza take-away chain Papa John’s in India and Middle East.
International brands are not the only ones to cash in on this trend. Local entrepreneurs have jumped into the fray with different concepts and ideas. Sunil Cherian, who runs the Chennai-based Burgerman is one such. Burgerman’s core business proposition is to offer 25 burger variants within a 25 sq ft kiosk. With 50 outlets in Chennai and 30 in Bangalore by the month-end, the chain has tied up with retail chains to grab captive consumers at Big Bazaar, Foodworld, Nilgiris or even HPCL and BPCL.
BuddyChef, which comes from the stables of Pune’s organic farming firm Orgreen, aims to sell pre-cooked Indian and Chinese meals under $1 across every pin code. With seven outlets across Pune, it is selling 5,000 meals a day across the counter to working couples, students and small offices.
Franchising has been a catalyst in fuelling the QSR concept in India. Sanjesh Thakur, Ernst & Young’s associate director, retail & consumer products practice, says that around 17% of the F&B outlets within the organised sector are operated through franchisees and over 30% of the upcoming outlets are projected to be based on this model.
The QSR trend was kicked off by the likes of McDonald’s and Yum! Restaurant’s KFC, which began operations in the 1990s. “Since the market opened up in the ‘90s, consumer habits including eating-out behaviour has gradually undergone a change,” said KFC India’s marketing director Unnat Varma. KFC added 27 outlets last year taking its total count to 72.
All this growth needs money and investors have started opening their purses to the industry.
Bangalore-based East West Ethnic Foods, the holding company of wraps chain Kaati Zone which is adding 100 outlets by next fiscal across Maharashtra, is in talks with two-three private equity players to raise between Rs 12-15 crore.
It received its first round of funding from Accel Partners India, Draper Investment company and the founder of Helion Ventures, Ashish Gupta.
Source:30 Dec 2009, 0006 hrs IST, Sarah Jacob, ET Bureau
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