Around this time last year, I was doing a series of blog posts on delivery and revenue management practices in restaurants in Bangalore. My apologies for not updating on that series for so long.
This morning I had my breakfast at SLV in Banashankari 2nd stage (near the BDA complex; opposite the park next to the complex). Despite being within 200 metres of my school, I don’t particularly remember going here too often. This is one of the very old-school darshinis – for a long time, these guys made no dosas. Even the last time I went there (about a year back), they served only idli, vada, kesari bhath and khara bhath. Today, however, I noticed that they were also making masala dosa.
Making dosa represents major progress in the “development” of a self-service eatery, since the space required for the equipment to make it is huge. Apart from this, the more important point is the nature of the dosa business. Idli-vada-chowchowbhath are all “made to stock” items. You make them once and store them, and dish them out as and when there is demand.
Dosa, however, is different in the sense that it is not really storable, at least not if you want to maintain quality (ok now this reminds me of electricity but anyway… ). Hence, unless the demand for dosas is huge (like it is in Upahara Darshini), the dosas need to be made to order. Which means that the tawa will not be used to its full capacity, and could become a burden in case kitchens are very small. A large number of really small places get around this problem by just not making dosas
What SLV has done in order to work around this problem is simple, yet fantastic. They have “off shored” all non-core functions. Anything that can be made elsewhere is made elsewhere, and only the last and most important step is done in their small kitchen. So today while I was downing the idlis, I noticed this van which stopped right in front to deliver idli batter, vada batter, cut vegetables, etc. Notice that all these are “store-able” and “transport-able” commodities.
Thinking about it, if you run a large number of such restaurants in a reasonably small area, then economies of scale can be employed with respect to the back-end process, which can help cut further costs. I won’t be surprised if this particular SLV has a few branches, or a tie-up with a few other similar restaurants, and shares it’s “back office”.
- It should be possible to easily split the process of cooking the items into various stages, such that the “work-in-progress” products at the end of each stage can be easily stored and transported
- If this is possible, only the last and critical stages – which cannot be offshored should be done on site (for example, if you try to bring in idli made elsewhere it loses in terms of quality. things like that should be avoided)
- It should be possible for the back end kitchen to deliver just in time the work-in-progress, so that the restaurant doesn’t spend much space in terms of just storing the stuff
- The back end should ideally have a large number of clients (anyways most of the “products” they deliver are commodities) so that they can effectively employ economies of scale
- In future, when real estate becomes more expensive, and restaurants (of all hues) will want to increase their “revenue-generating” area, this offshored model could become popular across all genres of restaurants
- This is not a new idea. I believe stores such as McDonalds are already implementing this. However, what SLV has done is to adapt this to the indian food scenario
- The benefits from off-shoring should be more than the costs of stuff like transportation
The only “major item” now that the SLV is not making is sambar. I’ll try explain in a follow-up post about the economics of making sambar and why the SLV is yet to bring this in. If you have any ideas regarding this, please leave a comment.