Haven’t each one of us fancied ourselves as restaurant owners at some time or the other? How complicated would it be to start and run a chain of restaurants? What would be the choice of cuisine? What about the economics of the whole set-up- what would be the input costs, fixed costs, mark-up, and profits? What would it be like to be hard at work when the whole world is out having a good time? To answer all these and many other questions, we did a recent Google Hangout with Raghav Joshi, Head of Operations – FAASOS Bangalore.
FAASOS, for the uninitiated, is a chain of food outlets selling freshly-made wraps (or rolls, or frankies or kathi rolls) as a desi alternative to the Mcdonalds, Subways, Dominos and KFCs of the world. Raghav, for the uninitiated, heads Operations at FAASOS Bangalore. He graduated from IIM Indore in 2011 and worked with Deloitte Consulting (Strategy and Operations) for eighteen months before joining FAASOS.
The entire hangout can be viewed here on our youtube channel. It is a must-watch for anyone who is interested in entrepreneurship and the retail/food industry.
Below is the edited transcript of the conversation.
All questions pertaining to FAASOS have been included in this post. All the philosophical questions (deciding to take the plunge, canvassing the family's support, learnings from MBA, advice to graduates) have been included in a separate post that will be published subsequently.
Q. What is FAASOS all about, and how does it plan to distinguish itself from other fast food chains?
Ans. FAASOS sells freshly made wraps at your doorstep, a desi alternative to western food chains. Food is prepared with a shelf-life of 24 hrs, unlike some competitors which use food frozen for months.
We are in the business of selling wraps. Also known as rolls, kathi rolls, Kolkata rolls, Frankie. We call them wraps – that is our primary product and the heart of our business lies in wraps. To draw an analogy, like it’s Pizza for dominos, and burgers for McDonalds, (although they may have some additional items on the menu), the core product with FAASOS always be wraps. In short, we are about fresh and desi wraps, delivered to your home in super-quick time. We make fresh food, hygienically prepared, and not frozen for six months. Unlike many of our competitors, our food is absolutely fresh and has a shelf life of one day. We try to deliver it to the customer as fast as possible. I don’t think there is an Indian chain in the fast food sector that has really scaled up to the national level. There are western chains, but no Indian chain has been able to get that level of mindshare among customers and provide a great level of service. We want to take this as an opportunity – as an Indian chain that provides great level of product and service at a national level, with great consistency. Basically a combination of product and service will help differentiate us.
Ans: Selling rolls requires him to play many different roles. Interviewing candidates, scouting for new locations, visiting the existing outlets.
I am responsible for the Bangalore operations of FAASOS, which includes responsibility for the outlets – starting the outlets, making sure they run smoothly, looking for new outlets, making sure we reach our sales and margin targets.
One of the greatest challenges faced by this industry (Quick Service Restauarants) is attrition. The three most important aspects of this business are the people, the location, and obviously the product. That is what is defining most of my day.
Usually start my day with interviews – for store level positions – store manager, assistant store manager, or general staff for the existing or upcoming outlets. Then spend some time looking at previous day’s reports – seeing how the stores have performed on the most critical KPIs - food costs, average delivery time, delays etc which determine the customer experience in the Quick Service Restaurant industry. I usually also spend some time looking for new outlets – during the afternoon when the traffic in Bangalore is more manageable. And in the evening I spend some time at the outlets, seeing how the product is being dished out, how is the level of service, what are the issues that multiple customers are concerned about, and how is the morale in the outlet. I take turns to go from one outlet to another – visiting 2-3 outlet.
Q.While diversifying across different territories and geographical locations, are there any plans to customize the menu according to local tastes?
Ans: We are about wraps, and we will be about wraps. No plans to customize to local tastes. However, if any new dish of local origin is identified and developed, it will be sold across all outlets across territories.
When we were moving to Bangalore, there was a debate within our company whether we should customize our menu according to local tastes. On one hand, some of us felt that in order to scale up to become a national brand, and an international brand, there had to be consistency in what we offered across different outlets, and therefore it did not make sense to change the menu. On the other hand, some of us felt that being a start-up, we should customize our menu to local tastes if it helps us to grow faster. In the end we decided to stick to the basics – the Wraps are basically what we are all about, and they are the favourite ones among our customers, and we want to stick to them in case of Bangalore as well.
In short, there are no plans to customize our menu to cater to local tastes, but if there is something of local origin, and that is liked by our customers (we are researching all the time on new products), we would like to launch it across all cities.
Q. What is your online strategy?
Ans: We pioneered the Tweet-to-order mechanism. Online ordering is already in place – a hygiene factor. A mobile app is in the works.
FAASOS has been very active in the online space – we are the first company to have launched ordering through twitter – You just have to tweet your order, and we will deliver it to your home if you are a registered customer. No need to type your mobile number, address or anything, all you need to do is register once. Tweet to order was well received by all our customers. We also have Online ordering in place – which is becoming more of a hygiene factor. Also a mobile app is in the works, should be out soon. We believe, (like many of our competitors) that the way to go forward is Mobile. Customers don’t want to call an outlet to place an order. They just want to tap at a few places on the mobile phone, and the order should be delivered to their home. That’s how easy it’s eventually going to become with the advances in technology. And we don’t want to miss the bus. That’s why we are continually investing in technology and working with our partners, and developing a super-cool app which will be out soon. Besides that, tweet to order and online ordering will always be in place. We really want to be at the forefront of accepting new technology and making it easy for our customers.
Q. What is the expansion plan for the future?
Ans: Bangalore – plan to go from 5-6 outlets to 40-50 outlets in 2 years. National: Hyderabad, Chennai, Gurgaon. Order not yet decided.
Right now we are in three cities – Pune, Mumbai, Bangalore. In Bangalore, the plan is possibly to reach 40-50 outlets in a couple of years (right now we are at 5-6 outlets). We’ll have to open 3-4 outlets per quarter. We are considering whether to go North – Delhi, or continue our expansion in the Southern part of the country – Hyderabad and Chennai. Hyderabad, Chennai and Gurgaon are the three next targets we have in mind.
The interview will be continued in the next post - Part 2
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