Delhi's Restaurant Industry Struggles as Patrons Flock to Noida and Gurgaon for Preferred Drinks

Delhi, known for its bustling restaurant scene and vibrant nightlife, has been grappling with a major crisis in recent times. The liquor issues in the city have cast a dark cloud over the once-thriving restaurant industry, causing significant losses to businesses and pushing customers to seek alternatives in neighboring cities like Noida and Gurgaon.

Nearly a year ago, the Delhi government took a controversial step by scrapping its existing excise policy, leaving the restaurant owners and customers in a state of uncertainty. Unfortunately, the business landscape is yet to recover fully from the aftermath of this decision. Restaurateurs are facing a dual challenge of limited availability of popular liquor brands and a mass exodus of patrons to nearby areas where the situation is more favorable.

The scarcity of well-loved brands such as Johnnie Walker's Black and Red Label, Bombay Sapphire and Samsara gin, Grey Goose vodka, Glenlivet, Jack Daniel's, and Monkey Shoulder whiskey, along with Jagermeister, has been a cause for concern among restaurant owners. Patrons who frequent these establishments have expressed their frustration at the inability to enjoy their favorite drinks, resulting in a dip in customer footfall and overall revenue.

Vinod Giri, the director-general of CIABC, mentioned, “Delhi is facing a shortage of premium alcoholic brands which will stick out more and more the peak season for drinks draws in. This is due to a variety of reasons arising out of the mid-year switch back to the old excise policy. Well-known brands of many companies are yet to re-register in Delhi. Some are held back at the government’s end for lack of approval, and some voluntarily by companies since they find the demand of paying full-year brand registration fee though there is only half the year left unreasonable and commercially unworkable.”

The severity of the issue has intensified during the peak summer season when beer consumption typically soars. Liquor vends and retail shops have been grappling with beer shortages, leading to further revenue losses for the hospitality industry. Restaurant chains, bars, and retailers are grappling with a widening demand-supply gap, making it challenging for them to meet the expectations of their customers.

One of the prominent restaurant groups, Lite Bite Foods, which operates popular chains like Punjab Grill and YouMee, expressed grave concerns about the ongoing situation. Rohit Aggarwal, the director of Lite Bite Foods, stressed that the months from April to June are usually the peak season for beer consumption at their restaurants. However, the unavailability of certain brands has hampered their ability to cater to customer demands, resulting in potential revenue losses.

Following the introduction of the new liquor policy, the lack of availability of alcohol in numerous restaurants, bars, and cafes has resulted in significant losses ranging from 20 percent to 40 percent. As a consequence, customers who prefer specific brands are now opting to patronize establishments in Gurgaon or Noida to enjoy their preferred drinks.

One such establishment, Cafe Tonino, situated in Connaught Place and popular among young crowds, is experiencing a decline in revenue by approximately 25 percent to 30 percent due to the unavailability of beers and wines. At present, around 50 percent to 60 percent of beer brands, including Erdinger, Hoegaarden, and Budweiser, are not accessible.

Similarly, another Italian restaurant, Diggin, is facing a loss of around 25 percent in business due to the absence of Tequila brands like Don Angel and Viva Mojo, Greater Than Gin, and Sparkling Wine. Additionally, beer brands such as Kingfisher, Heineken, and Budweiser are also unavailable. An official, speaking on the condition of anonymity, revealed that numerous brands are currently unavailable. However, some relief came when Teacher's (Whisky) became available a few days ago, although the official refrained from providing further information on the number of brands still unavailable.

A renowned dining destination in India, Lord of the Drinks, is unfortunately experiencing a substantial loss of approximately 30 percent to 40 percent in its contemporary drink menu. The official, who chose to remain anonymous, expressed the significant impact of brand unavailability on their business. The lack of specific brands has particularly disappointed their brand-specific customers, including youngsters, leading to a decline in customer patronage.

The unavailability of various liquor brands has become a common concern for restaurants and bars in Delhi, affecting their revenue and customer loyalty. With discerning patrons seeking alternatives in neighboring cities, it has become imperative for establishments to address the supply constraints and regain the trust of their clientele to thrive in the highly competitive hospitality landscape.

In addition to the financial implications, restaurateurs are also facing the embarrassment of having to explain to diners why high-quality liquor options are not available. This has negatively impacted the reputation of these establishments and raised questions about the government's handling of the excise policy and the liquor supply chain.

The government's decision to increase the number of liquor stores in Delhi was expected to alleviate the supply constraints and improve the buyer's experience. The goal was to double the number of stores from 350 to 700. However, this target is yet to be met, as only 584 stores have been opened as of the latest update. This sluggish progress has contributed to the prevailing liquor scarcity, leaving consumers dissatisfied and restaurant owners worried about their businesses' future.

The repercussions of the liquor issues have reached such a critical stage that customers are now seeking alternatives in neighboring cities like Noida and Gurgaon. Many patrons who were once regular visitors to Delhi's vibrant restaurants are now making the journey to these nearby areas to indulge in their preferred drinks without facing the limitations experienced in the capital city.

Delhi's loss has become Noida and Gurgaon's gain, as restaurants in these regions have seen a surge in footfall. Patrons who are unable to find their favorite brands in Delhi are now flocking to restaurants and bars in Noida and Gurgaon, where they can enjoy a more diverse selection of liquors. This shift in consumer behavior has had a significant impact on the revenue streams of Delhi-based restaurants, further exacerbating their financial woes.

To add to the complexity of the situation, French spirits company Pernod Ricard, a major player in the global liquor industry, has faced regulatory issues in Delhi. The rejection of Pernod Ricard's license application, along with those of Indospirits and Brindco, has resulted in the unavailability of many premium liquor brands that were once a staple in Delhi's dining establishments. This has not only disappointed loyal customers but also impacted Pernod Ricard's market share and revenues.

The dire situation calls for immediate action from the Delhi government and concerned authorities. Resolving the liquor issues and streamlining the excise policy is crucial to reviving the restaurant industry in the capital. Addressing the supply constraints, ensuring the availability of popular brands, and meeting the target of opening 700 liquor stores must be a top priority to win back customers and restore Delhi's status as a vibrant culinary and nightlife destination.

The fate of Delhi's restaurant industry hangs in the balance, and timely intervention is the need of the hour. By restoring confidence in the liquor supply chain and creating a favorable environment for businesses, the city can once again reclaim its position as a gastronomic haven, where patrons can indulge in their favorite libations without any hindrance. Only then can Delhi hope to stem the tide of business losses and woo back its wandering clientele from the neighboring cities of Noida and Gurgaon.

The impact of liquor issues in Delhi extends beyond just the financial losses faced by restaurant owners. It has also taken a toll on the city's reputation as a thriving hub for food and beverage experiences. Delhi, known for its vibrant social life and diverse culinary offerings, has always been a go-to destination for locals and tourists alike. However, with the current constraints on alcohol availability, the city's image is at risk of being tarnished.

Tourists who visit Delhi for its rich cultural heritage and culinary delights now find themselves disappointed with the limited options for alcoholic beverages. This dissatisfaction may lead them to explore other cities with more relaxed liquor policies and a broader selection of brands. Consequently, Delhi's hospitality industry is not only losing its loyal customer base but also potential new visitors, which can have long-term implications on the city's overall economy and tourism sector.

For the restaurant owners who have invested their time, efforts, and resources into creating unique dining experiences, the current liquor crisis is a major setback. Many establishments are facing an existential threat, with some even considering downsizing or shutting down altogether. The uncertainty surrounding the liquor supply has made it difficult for them to plan for the future and attract investors, further exacerbating their financial woes.

As patrons flock to Noida and Gurgaon for their liquor fix, the competition among restaurants and bars in these neighboring cities intensifies. These areas are now witnessing an influx of Delhi-based customers, resulting in increased revenues for the hospitality businesses there. The success of Noida and Gurgaon's restaurant industry is, in part, at the expense of Delhi's own.

As the situation unfolds, the Delhi government must also take lessons from other cities and states that have successfully navigated liquor-related challenges. Learning from best practices and adopting policies that have yielded positive results elsewhere can go a long way in reviving Delhi's restaurant industry.