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Hyderabad-based Café Desire is renowned for setting up hot beverage vending machines pan-India. The brand sells more than 4 lakh cups of coffee and tea daily and is planning to double its number by adding 100 more franchisees by 2015. Associate with them
Hot beverages form an integral part of our daily consumption which has been a critical element in the flourishing tea and coffee industry. Despite the availability of umpteen numbers of beverages, coffee and tea continues to occupy an important place among Indians. The coffee retail business in India is valued at over Rs 8 billion and growing at 6 per cent annually. The Indian tea industry pegged at Rs 6000 crore is the second largest in the world. As the domestic demand for tea gets stronger manufacturers and brands are investing in modernisation and improving quality in order to consolidate gains and improve global competitiveness. Therefore, time is right to invest in the opportunity which does not a have a saturation point.
Café Desire, a brand which installs vending machines and supplies beverage mixes has been satiating the tea and coffee lovers' pan-India for more than a decade. They brand installs vending machines at various places like corporates, software companies, hospitals, educational institutes, hotels, restaurants, resorts and public places like bakeries, canteens, bus stands, railway stations, airports, cinema theatres, malls, etc. Now you can also brew instant success by selling a hot cup of coffee or tea as the brand is seeking partners.
The brand had quenched the desire of each coffee and tea lover and franchisees too across India by installing the hot beverage vending machines in every nook and cranny. The brand was launched in the year 1999 and has 200 franchisees. From the day one it had a clear focus, to cater to only hot beverage solutions for workplace of any kind, small, medium or large offices through a range of automatic vending machines and beverage mixes, wherein customers can have a hygienic cup of tea/ coffee at just the press of a button, avoiding the hassle of dealing with pantry, gas, pantry boy, milk, coffee, tea and sugar.
They offer largest range of beverages, apart from regular coffee and tea. They also have lemon tea, ginger tea, cardamom tea, low sugar tea, diet tea, low sugar coffee, diet coffee, tomato soup, Chocó feast and white malt. Now they have added single serve sachets of coffee and tea in different flavours.
Franchising sweetest ingredient for success
As Café Desire satiates the craving of all coffee lovers, similarly they fulfill the desire of franchisees too by offering them a hot opportunity. The brand does not have a retail cafe model. It offers two options to potential customers, the first is to have vending machine installed at the required place by paying the full cost of vending machine and second, to get the vending machine installed on an yearly service on contract basis.
Based on the contract, a customer needs to pays just Rs 6,000 for one-year contract and the brand installs the vending machine on his premises for one year with the commitment of 12 general services in one year and vending machine breakdown support with free replacement of spare parts all through the year. Around 90 per cent of their installations are on a contract basis.
When asked about choosing the franchise model, Ghouse Mohiuddin, MD, Café Desire says: “Cafe Desire got the required mileage from the franchise business model so far but there is lot more to come in three to five years down the line. We as a company will be introducing instant green tea for which we approached for patent rights, we will be launching our cold beverages this summer in India, Oman and Dubai and also next month we are launching instant coffee retail pack of 500 grams suitable for all the industrial canteens, defence establishments, caterers etc., and 1 gram sachet priced Rs 1 per pack very suitable for rural markets, airlines, and hotel industry. All these products will be routed through our authorised franchisees who will help them to widen their canvas, product portfolio, turnover and profits.”
As far as quality is concerned, Cafe desire is the only company having direct service team with a national toll free service number and call centre support for their customers. Also all their products are certified by GMP and FSSAI.
The right mix of franchisees
The biggest challenge that vending machine industry has been facing is reaching rural markets in terms of after sales services. There is a huge demand in tier I and II towns but the brands have still not tapped the opportunity as the brands are unable to extend the service support to these customers. Cafe Desire had identified this problem and decided to have service clusters to cover complete length and breadth of the country with the fleet of service technicians. To associate with the brand, prospective franchisee must qualify the requirements the brand calls for - location, experience, ability to tap institutional markets, adaptability to our franchise system and investment capacity.
Every franchisee needs handholding to grow the business. Café Desire's franchisees get the same as the installation of vending machines is taken care of by the company. This works as a biggest advantage and relief for the franchisees as they can focus on acquiring new customers. The Company trains and supports the franchisees about selling and setting a coffee vending machine. The training is conducted at their head office. After the completion of the training, franchisee is assigned a franchise development manager who helps and guides him to scale up the business and profits.
Café Desire is looking forward for some good exponential growth in 2014 with lining up of more than 100 new franchisees at domestic and international level. The brand is mulling to launch cold vending and cold beverages division too. Talking about company's expansion plans, he adds: “We are planning to sell retail packs of instant coffee in 500 grams ideal for big industrial canteens and caterers who are not using their coffee vending machines and one gram instant coffee retail pack for travel companies, hotels, restaurants etc., this is going to add required muscle to our growth apart from deeper brand connect value with the end consumer.” They will also be promoting their website in 2014 to build the required turnover from online sales of coffee and tea. They are planning to route and deliver the online orders through their local franchisees adding additional profits to the existing franchisees from these sales and marketing activities.
Regarding going global, they made their foray in the international market in 2013 in Sultanate of Oman and Dubai. Further the brand will be tapping the markets of complete Middle East along with Iran and a few African countries.
For franchise queries contact
Manoj Nair, Franchise Manager
Phone : 09676257275
Website : www.cafedesire.co.in
Existing franchisees: 200
Investment: Rs 4 lakhs
Area: Existing office or home
Break-even: Less than 1 year
Franchisee fee: Nil
Royalty fee: Nil
Term of franchise agreement: 3 years
Coffee with the ‘Vending Mogul’
In a quick chat with Beny Sachdeva, Ghouse Mohiuddin, MD, Café Desire tells about his entrepreneurial voyage.
How has been your entrepreneurial journey?
My entrepreneurial journey had its own ups and downs initially, but now we are quite settled in our business conduct. We struggled to sustain our growth but with the help of investment in our machinery, process, technology, IT and good team. I am relieved from day to day operations which helped me to focus on innovation and strategy to scale up the business. I feel we are on the highway and moving in right direction, my team deployed for Indian operations is fully geared up to handle domestic operations and. I started looking into international business for which I would like to lay solid foundation and process in place and from there my team members can take on.
How has been the competition in India's vending machines industry? Any strategies that you have incorporated for a wider brand distribution.
Fortunately there is not too much of competition in India's vending machines industry, we have learnt over a period of time and adopted wider base of strategies for our market penetration and positioning, and these strategies help our franchisees to sell better and make better ROI. Few of the strategies we adopted are direct service team with a call centre support to all our customers, we share five sales engines with our franchisees and they start selling faster, wider choice of beverages for customers, health beverages for school children dispensed through our vending machines, ready to drink single serve sachets for small offices , homes etc.,
The acceptable rate of return on an investment will depend on the choice of industry in which the franchisee places his money. So, according to you, do franchisees need to analyze before investing in a particular industry so as to get maximum RoI.
I feel the decision to choose the choice of industry should be based upon where the franchisee passion is rather than maximum ROI, but to answer your question yes franchisees should analyze before investing in a particular industry.