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people 17 Sep 2013

The economy will shake out the F&B industry and the best players will move on

An interview with Narendra Malhotra, CEO, Oriental Cuisines.

CEO of Oriental Cuisines, Narendra Malhotra, tells Franchise India about the F&B trends of 2013-14, the challenges faced by the company and his responsibility in taking the brand forward.

Tell us something about Oriental Cuisines.

Oriental Cuisines was founded and conceptualized by foodie M. Mahadevan. The company and its brands have grown exponentially since 1994 to make it what it is today. We operate restaurants offering different global cuisines including Thai, Japanese, Spanish, French, Chinese and Kerala. Oriental Cuisines has also been a pioneer in establishing food courts in the country, having started humbly with a Planet Yumm food court. Peepul Capital came on board as our investors in 2007 and we have grown to a whole new level since.
 

What has been your role and responsibility in taking the brand forward?

When I joined the company as CEO, we were 78 outlets in all. Today we are 110 and growing. We plan to close this financial year at 140 outlets. Primarily, we have given focused attention to two of our formats – Wangs Kitchen (our casual dine Chinese restaurants) and the French Loaf (our bakery model). We’ve held branding exercises involving everybody from operations to management to marketing and a lot of thought and strategy has gone into revamping the physical structures, the ambience, the menus and the service. Profitability has jumped by 5 percent points last year. We have also invested a great deal in establishing a training institution for our staff.

 

Tell us about the challenges faced by Oriental Cuisines.
Like all businesses today, revenue growth is a challenge as we are faced with rising costs in the market.  We’ve put our heads together to offer better value for money to the customer. We have adapted to market demands and structures and have found a way to make our way into the customers’ mind and heart, giving them reason to come back for more. We understand the challenges of the market and ones that each of us as consumers are facing.

Tell us how Chennai is as an industry and how different is their working as compared to Bangalore and Kolkata.
Chennai behaves like all other markets. We have an advantage here as we have been in the city for many years and our customers know us like the back of their hands. We enjoy better response to marketing initiatives.
 

Tell us about the F&B trends in 2013-14 and the impact of slow economy.
People are becoming more conscious about the value for money and are experimenting newer cuisines. Another trend we have seen is the increasing awareness about health benefits from different kinds of food. Today, the consumer is aware about gluten-free product, trans-fats, 5G, etc. 

The economy will shake out the F&B industry and the best players will move on. If businesses aren’t able to adapt they will find it challenging to sustain. Strong concepts, strong offerings and value for money are winners. 
 

What do you have to say towards people’s inclination towards organic food and how are restaurants copying with it?

People are definitely becoming increasingly conscious of organic food and are looking at ingredients on menu cards. Some restaurants have begun offering them and the trend is probably on the path to lean more and more towards organic.

What advice would you like to give to entrepreneurs who want to invest in restaurants in this volatile market?
My advice is that it is easier to work on concepts that have been tried and tested, rather than build restaurants from scratch in a market like this. Good food, good service and good ambience are of course the key aspects that need to be thought through before venturing into this business.

What advice would you like to give to budding restaurant owners in this volatile market? Tell us how you will guide a newcomer in the industry.
This is an exciting industry, offering a lot of scope for growth. There are many different aspects to F&B that budding restaurateurs and newcomers can explore based on their interests and strength. While it is advisable to go with tried and tested concepts in this market, I would encourage people to discover their passion and figure out where their strengths lie. 

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