It all started when S.R. Rao Sahib was on a business meeting in Mumbai. “After the meeting, around 4 pm, I was searching for pav bhaji at a restaurant. The food item wasn’t available as the chef, who was an expert in making pav bhaji, had left.” Sri Family Group was already specializing in Easy-To-Cook mixes prepared through Dry Blend Technology. This incident triggered the idea of running a restaurant where food can be made through “our ready-to-make mixes, therefore, we would not require any skilled chef”.
Sri Family Group of Companies started in 1999 by Lalitha Rao Sahib. A Mechanical Engineer by qualification, Lalitha was awarded Women Leader of Tomorrow by ET Now and IndiaMart.
In an exclusive interview with Restaurant India, S.R. Rao Sahib, Director of Sri Family Group, tells it all about his restaurant business Café Udupi Ruchi.
The Story Behind Starting Café Udupi Ruchi
I started my career in 1983 with Voltas, handling Amul and Rasna. In 1999, I and my wife Lalitha Rao Sahib decided to start our own venture; she is, basically, from Udupi. We started with the nutrition supplement and were the sole manufacturers of Sunfeast pasta, Yippie pasta, Ashirvad rava idli for ITC for pan India during 2003-2016. The Sri Family Group also got associated with Dr Batra’s, Walmart and Elder Pharmaceuticals; we have our own R&D Center where we develop the product and manufacture for them on a long-term basis.
From 2011-2014, 87 vegetarian restaurants got closed in Mumbai because of the shortage of skilled labours; the UK alone requests over 1.2 Indian curry chefs. While the demand is increasing, there is also a shortage of supply. Back then many reports of Udupi concept restaurants closing down were rotating. We thought to rejuvenate that brand. Another thing we noticed that the younger generation was eating a lot of junk food. That’s how and why we came up with the concept of Café Udupi Ruchi. To give it a modern twist and attract the new-age diners, we gave the modern look and feel to our café, but the food we serve is traditional.
The Growth of Café Udupi Ruchi
We started Café Udupi Ruchi’s first outlet in 2014 in Bengaluru. We promoted it as the world's first chef-less vegetarian restaurant. We keep the freshness alive by adding vegetables. We use Curcumin, extracted from turmeric, to use it as a colouring agent in food. We don’t sell any beverages at any of our outlets neither water bottles. Today, we have eight outlets in Delhi-NCR.
In the South, we have at Avinashi highway (Pondicherry), Bangalore-Mangalore Highway, Trichi; we are planning to open one in Hyderabad as well.
Innovations at Café Udupi Ruchi
We are completing our fifth year in June this year. Along with more outlets, we will launch new products. We have software, Epic, that calculates the preparation time of each and every product, food delivering time; it’s in-house software.
Our maximum sales come between 9 to 11 pm as many vegetarian restaurants close by that time. Because of the technology we use, it’s easy for us to produce idli even at the closing time; we get to deliver it in nine minutes.
With technology, we are also helping curb the food wastage menace. Backward integration is done up to the factory level.
The software also calculates the orders for the previous year or week-wise data on consumption or food ordering. That’s how we prepare ahead. For example, last Tuesday if we sold 100 plates of idli, so the same day we will prepare 50 idlis in the morning. We have only 0.7% food wastage; controlling wastage to 1% is a surplus task.
The most-selling dish in South – Idli and Dosa, rava dosa and rava idli and thali items during lunch; The most-selling dish in North is Idli, Dosa and rice bowls.
The people in the 17-30 age group frequently visit our place. Families and other visits too but younger generation visit often.
The restaurant runs on four business models - kiosk, express plus, gateway and highway.
The first is kiosk model – the area required is 100-220 square feet at the investment of Rs 12 to 14 lakhs; it requires about four to five people for operation; the ROI is 14-15 per cent.
The second is Express plus model – the area required is 600 to 900 square feet at the investment of Rs 20 to 32 lakhs; it is 10-12 seater. The ROI is 10-12 per cent.
The third is Cafe model –the investment required is 60 to 70 lakhs; it is more than 15 seats. The ROI is 10-12 per cent.
The fourth is the highway model – the investment cost lies between Rs 80 lakhs to 1.3 crores. The ROI is 9-10 per cent.
This excludes the franchise fees. The return on investment for the kiosk business model is 15 to 18 months, for the highway model it will take over 30 months and for the rest two - express plus and café – 24 to 30 months.
We have our own training centre; we have tied up with a lot of NGOs and, thus, recruit staff from there. We do not take tips from the customers. Based on the model, we have four different types of menu engineering. For each outlet, there's a set of menu products. We have our own niche in the market. When we do the market study we select some of the products which are not very highly competitive in the nearby outlet.
Criteria For Franchise Selection
Before deciding on the franchisee, we want to know why the person is interested in the business. We want them to build a long-term association. We have this franchise selection media which looks for the location, etc. We have a format and survey markets study. The franchisee has to undergo training for 12 days as the majority of people do not come from a background of vocal operations. We have our own Epic software.
After the operation starts, we do hand-holding for one month. By doing this we create a lot of entrepreneurs.