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Uncovering the Barbeque Nation’s Secret Sauces

Uncovering the Barbeque Nation’s Secret Sauces

June 20, 2023
6
mins read

Imagine a dining experience where you take charge of your appetizers, season them to perfection, and savor them hot off the grill, followed by an endless feast of heavenly dishes. This is the essence of Barbeque Nation, a culinary revolution born out of customer complaints about appetizers getting cold. Founded in 2006 by Sayaji Hotels Ltd., Barbeque Nation has emerged as the pioneer of the live grill concept in India.

Barbeque Nation has become India’s first full-service casual dining restaurant brand to achieve revenue exceeding INR 1,000 crores in a year. The brand boasts an impressive presence with around 200 outlets in 82 cities across India as well as 4 outlets in UAE, 1 outlet each in Malaysia and Oman. Expanding its culinary expertise, Barbeque Nation also operates fine-dining Italian restaurants under the brand Toscano, along with online food delivery segments such as UBQ (a la carte format), Barbeque-in-a-Box (featuring signature barbeque delicacies) and Dum Safar Biryani.

But let's dive deeper into the heart of the matter: How does Barbeque Nation manage to sustain and grow, while offering an unlimited dining experience that often comes with a higher minimum spend per person? Let's explore the secret sauce that keeps the flame burning bright at Barbeque Nation.

1. Culinary Essence - Nurturing Quality and Efficiency:
Through economies of scale, it keeps the material costs at approximately 35% of its revenue. This is attributed to below factors as well:

  • Long-term vendor contracts: By establishing long-term contracts with trusted vendors, the impact of raw material inflation is mitigated. Specifically, the company maintains dedicated suppliers for its meat requirements, with fish and chicken accounting for over 50% of its material costs. Additionally, it strategically sources ingredients from various suppliers, and in some cases, even imports them from outside India, such as fish from Vietnam. This meticulous approach guarantees consistent quality across its restaurant chain.
  • Waste reduction through table reservations: By offering reservations, it accurately estimates customer demand, leading to improved sourcing and staffing decisions. This minimizes waste and enhances cost management.
  • Streamlined menu: The pre-determined menu allows for efficient kitchen operations. Unlike other restaurants that must be prepared for a variety of dish orders, Barbeque Nation can optimize inventory management by focusing on specific ingredients required for its fixed menu.

2. Footfall – Managing Strategically;

  • Balancing the week: It achieves balanced revenue from both weekdays and weekends, with a 45:55 ratio of lunch to dinner covers. Their buffet spread appeals to corporate lunches on weekdays and families on weekends, ensuring high-capacity utilization and consistent revenue. Moreover, their outlets strategically dot the landscape near corporate offices, ensuring a steady flow of patrons during weekdays and lunch hours. This high footfall results in impressive table turnovers (1.8–1.9x), exceeding industry averages (~1.3x).
  • Fixed time slots: It operates during two key time slots - lunch and dinner. This not only allows ample preparation time but also ensures that the restaurant attracts customers who appreciate a well-rounded dining experience rather than idle munching.

3. Customer Experience: Where Flavors Meet Satisfaction:

  • Diverse Offerings: It provides a wide variety of pre-cooked appetizers, both vegetarian and non-vegetarian, allowing customers to season and barbeque them on their table grill. With an all-you-can-eat buffet for the main course and a selection of desserts, this diverse menu caters from Generation X to Z, ensuring a memorable dining experience. The option for DIY and live counters offers customized touch to the dishes.
    (And not to forget the strong guest focused and prompt service offered!)
  • Infusing Local Flavors: While maintaining standardized menus, it adds a local touch by incorporating regional dishes that align with the culture of the trade area.
  • Food festivals: It organizes food festivals centered around Indian, international, and fusion cuisines to add excitement, serve variety and attract customers seeking unique culinary experiences. Examples: Hakuna Matata (African cuisine), Mango Mania (Mango centered dishes), Khao Gallo – Dilli 6 (Delhi’s street food), etc.
  • Fixed-Price Dining for Value: The fixed price concept offers perceived value for money for large groups and eliminates uncertainty over individual consumption. This makes it an attractive choice for customers seeking a cost-effective and hassle-free dining experience.
  • Prioritizing Guest Satisfaction: Barbeque Nation places a strong emphasis on customer feedback through its Guest Satisfaction Index (GSI) platform. Guests are encouraged to provide their contact details, and a significant percentage of them are personally contacted to gather detailed feedback. The GSI score, assigned to each store based on customer feedback, becomes a vital performance indicator for store managers, highlighting the importance of customer-centricity.

4. Optimal Location Planning: Maximizing Revenue and Customer Experience:

  • Strategic Location Selection: Barbeque Nation's dedicated internal team leverages robust back-end systems to precisely choose restaurant locations. They open outlets in famous business districts, neighborhoods, and local markets without incurring high-street premium rentals. This flexibility allows them to occupy unconventional spaces, such as the second floor of a mall or any inner lane, while aiming to maintain a low rent-to-revenue ratio (~10% vs. industry average of 15%).
  • Streamlined Outlet Design and Cost Efficiency: Each outlet requires a capital expenditure of INR 2.5–2.75 crores. Standardized outlet design, material selection, equipment, and fixtures help reduce execution time, facilitate bulk sourcing, and enable favourable project contract negotiations for new outlets.
  • Efficient Reservation System: It offers group tables to cater to reservations-driven footfall and the demand for communal dining experiences. With approximately 70% of tables consistently pre-booked, often by groups, their proactive booking system ensures a steady flow of guests and maximizes table utilization. Such reservation system does away with the necessity of being in very prominent locations.

5. Widening the reach:

  • Cost-effective marketing: It utilizes low-cost billboards, banners, and digital marketing rather than expensive TV and print ads used by QSR players. With ad spends at only 1-2% of total revenue, the company targets customers near its stores. Influencer marketing, social media campaigns, video marketing, and offline promotions further amplify their reach. For example, it organized Punjabi Food Festival called 'Jatt Set Go' in collaboration with renowned food blogger Gurpreet Singh, also known as Mister Tikku.

With increasing urbanization, rising disposable incomes and a desire for socializing and culinary exploration, the demand for dining experiences continues to grow. The rise of women in the workforce has led to changes in household dynamics, with a decrease in home-cooked meals and a growing demand for meals consumed outside the home. Barbeque Nation has successfully tapped into this rising trend of eating out in urban India. It has become a popular choice among food lovers by offering value-for-money concepts that prioritize quality. They have taught the Indian restaurant industry that providing value does not necessarily mean lowering prices.

Disclaimer :The information contained herein is for general information purposes only and shall not be relied upon as financial/investment advice. The information provided is compiled from sources, which are beyond the control of capitalvia.com. Though such information is recognized by us to be generally reliable, the reader accepts and acknowledges that inaccuracies may occur and capitalvia.com does not warrant the consistency or suitability of the information.
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Disclaimer: The information contained herein is for general information purposes only and shall not be relied upon as financial/investment advice. The information provided is compiled from sources, which are beyond the control of capitalvia.com. Though such information is recognized by us to be generally reliable, the reader accepts and acknowledges that inaccuracies may occur and capitalvia.com does not warrant the consistency or suitability of the information.

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