Digital Accelerator for Power Food Brands.
Kitchens@ is a plug-and-play Cloud Kitchen model that enables entrepreneurs and food companies to realize their culinary dreams. The company was started when the team realized that they had a terrific opportunity to help address the challenges faced by the food industry. The challenges thrown up by the pandemic, the lack of funds, changing consumer behavior, and the need for speed affected food companies of all sizes. The food entrepreneurs lacked funds, guidance, and support. The established offline food brands needed help to turn their business model online to scale up quickly.
Kitchens@ saw these trends and realized they can scale restaurant brands 10 times faster. And thus came the idea of a Digital Accelerator for Power Food Brands.
Catch the man behind Kitchens@ - Junaiz Kizhakkayil’s interview with Devaraj Bollareddy of Sakshi Post, on how he transformed the brand into what it is today.
The pandemic brought many implications for the culinary industry and many companies struggled to keep their head above water. How did you deal with the challenges that the pandemic brought to your industry?
Surprisingly, the pandemic saw a boom in the cloud kitchen industry. While the standalone restaurants were severely affected by the pandemic, it pushed cloud kitchens to do well. Although initially there was a slight drop in orders, customers continued to order, and the numbers increased exponentially. Cloud kitchens allowed them to choose from various cuisines they crave and have them delivered to their doorstep.
Kitchens@ is a digital accelerator for food brands, in my opinion, that is a revolutionary business idea. How did you come up with it?
Yes, we are a digital accelerator for food brands, and the main idea of starting this was to make marquee brands accessible to everyone in the country. When one thinks of a digital accelerator, scalability is the key.
Since success ultimately depends on consistently and effectively delivering an excellent consumer experience, lower start-up and operating costs alone cannot ensure success. While cloud kitchens lower operating costs, they do not help with the many other challenges of scaling up, which leads to a lacklustre consumer experience. For instance, the general cloud kitchens model cannot address key issues such as precise order forecasting, demographics analysis, kitchen management, robust supply chains, culinary innovation, quality control, product consistency, and so on.
What we do is identify certain brands (National as well as International), and we help them scale their operations, bringing the essence of their brands towards areas that they don’t yet have a presence in, and that is what we do as a digital accelerator. The notion of creating a digital accelerator came from the idea of leveraging the right brand partnerships comes from having a deep understanding of what consumers look like within given Micro Markets. Our model allows us to identify and onboard brands that people like, scale them up, and tap into consumer equity within the given regions that visibly contain such cuisine gaps. Now, we are completely focused on our franchisee operations, where International and National brands give us complete access towards pan India scalability through our end-to-end supply network, our kitchens to operate, and our culinary team. We help them scale their brand across the country.
You have many restaurants and food chains under your belt and your company strives to maintain international hygiene standards, does it ever get complicated and stressful when you must deal with so many businesses?
No, it does not get complicated because first- we have strict SOPs put in place and a team of proficient members who ensure that everything operates smoothly. These SOPs do not just
include the way we operate, but also something that is inherently embedded within our hub designs, allowing us to establish consistent hygiene standards throughout all kitchens and all the brands associated with us. We have already overcome the first hurdle of standardizing extremely high hygiene requirements amongst all our kitchens, and that is further augmented by SOPs that we investigate regularly.
With operations in over 20 cities and 100 locations with 1000 kitchens, you run a very large business. How involved are you in the day-to-day functioning of your business and how to do ensure that everything stays on track?
As mentioned previously, we have automated tech integrated SOPs that we have created and the team that we have put together. This allows us to monitor operations daily. We have different data streams that generate reports giving us an idea of what our current weekly and daily situations are and how this is going to forecast into our operations for the foreseeable months and so forth. The same process also helps in kind of tangencies into the way we operate, and a lot of these reports come in from the rest of our team. We have a relatively flat organizational structure; this means it allows us to communicate more effectively with every head that is associated with different aspects of our operations. We have daily updates, and bi-weekly updates of what has happened with the entire team through different software that we use to monitor operations, as well as activities.
Do you have any tips and suggestions for young budding entrepreneurs who may be reading this?
I would ask them to be an entrepreneur. Being an entrepreneur may seem like a fun job, but it comes with its share of difficulties. Adding to that, unless you have a solution to a big problem that is in the market, do not launch a startup. That also comes with a certain amount of industry knowledge you have on the subject, and the expertise you hold on to the same subject. Owning a company is fun but you need to know what you want and how you are going about it. A very clear well researched and fleshed-out idea.
How have your priorities changed since you first started Kitchens@ and now?
When we started Kitchens@, we primarily followed an infrastructure business model where we basically gave out spaces, infrastructure, and technology. All the brands had to worry about is the prep of the cuisines that they are offering. Eventually, we moved the model to COK i.e., Company Operated Kitchens or the franchisee models. We have now put a lot of emphasis on the COK than Brand Operated Kitchens.
You have come really far, and, in the process, you established a successful business that helps other small businesses out. In retrospect, is there anything you would have done differently when you were first starting out?
I would have started my own culinary operation with the International and National franchise brands instead of starting off as an infrastructure business model. One more thing is, consolidating our operational capabilities. Although this is learning, I wish we knew this when we started our operations.
Can you shed some light on some of the challenges you faced while growing your business and how you overcame them?
When we started Kitchens@, the biggest challenge we faced is while onboarding the brands, we did not categorize the brand in the market,we didn’t evaluate them properly. We provided infrastructure to every brand that approached us. What we did not understand is that creating abrand is not easy because if there was no value for a particular brand then they will not have equity in the market. The most important thing here is rather than just looking at incubating brands we started to eject them. We were at 85% occupancy in the starting and then we had to cut down to 37% because of the lack of awareness of these brands. Now close to 95% of revenue is given to us by just 20 brands.
As someone who according to most is extremely successful, what is your definition of success?
According to me, success is not only about making profits. Success for me is solving a real problem to help people.
What are some of the things you enjoyed the most about starting your own company?
One of the things that I enjoyed the most was building a team of smart, like-minded people. Another aspect is definitely being the franchisee owner for top International brands, bringing them to India and enabling our customers to enjoy different international cuisines.
Kitchens@ offers entrepreneurs, food aggregators, and international brands the support to rapidly scale up, and also the chance to build their businesses, riding on their cloud kitchens, supply chain network, culinary expertise, and technology. Kitchens@ already has entered into non-exclusive partnerships with leading aggregators like Swiggy, Zomato, Dunzo, and Amazon.