Restaurateurs to open outlets in tier- 2 cities

HospiBuz Desk

Restaurateurs are realising the potential of non-metros cities, restaurateurs like Priyank Sukhiya, who runs brands such as Townhouse and Tamasha, invites his friends for lunch they’ll think it was for a restaurant opening in any metro but they were all highly mistaken. Sukhija Flying saucer was opening the door in Lucknow in February, also Riyaaz Amlani, CEO of Impressario, which runs popular outlets like Social and SmokeHouse Deli, opened Mocha in Kanpur, in the following month, Zorawar Kalra took his Farzi Cage to Jaipur.

Zorawar Kalra is planning to open around 18 to 15 outlets by March 2019 and in process on opening restaurants in Belgaum, Siliguri and Indore.

Amlani raises his recent foray in Raipur, Guwahati, Indore and Nagpur targets to have 40 Mocha Outlets in 40 cities as he sees these places offering “good returns on Investment”.

Return on Investment 

Restaurant opening in metro cities is not an easy task one needs to have strong planning and investment, in metro cities like Mumbai and Delhi the rentals starts from Rs 300 per sq ft. In the major spot, it can go up to Rs  700 to 800 per sq ft. after this the real battle starts of getting permission and licences and hiring appropriate staff, it almost costs Rs 1.5-2 cr to set up a decent restaurant in the main market of metro cities. 

Zorawar Kalra states that the rent is a big plus point “Rentals in rising cities justify why we are moving there. They give far better return on investment and profitability per store. Our new outlet in Jaipur has already started breaking even operationally and we expect to recover our entire investment in 18 months.” He says many of these cities are familiar with his restaurant brands: “90% of requests I get to open a new restaurant come from smaller cities.”

Amlani states that- For these restaurants, it is not about modernising laal maas in Jaipur and giving poha a contemporary touch in Indore. Most of these outlets dish out what is called modern cuisine. “These cities have a large young population that is demanding dine-out options.

The restaurant boom in these non-metro cities has allowed a lot of trained staff who had moved to bigger cities for work to return to their hometown. Sukhija says he wanted trained hands for his foray in Lucknow and floated openings within his company. To his surprise, he found that the staff at his outlets who hail from in and around Lucknow wanted to move back. “Delhi and Mumbai may have offered better salaries but the cost of living in these cities are at an all-time high. My staff members requested to be transferred to the new outlet,” he says.