Tag: masala dosa

No dosa on Saturdays and Sundays

Back when I was a student at IIM Bangalore a decade ago, I had tried to run this series on this blog (its predecessor, to be precise) on “delivery mechanisms in South Indian Fast Food restaurants”. I had half a mind to do a project on that, too, but then worse sense prevailed, and I did some random shyte on post offices.

Anyway, given that I’ve been living alone for a year now, I tend to frequent South Indian Fast Food Restaurants fairly often for breakfast (and tiffin, sometimes), and thought I should resume this series.

So this morning I went to “duplicate Brahmin’s” for breakfast. This is a place in Jayanagar 4th Block (next to the 560041 post office) and should not be confused with the “original Brahmin’s” in Shankarpuram. I don’t know if this Brahmins has anything to do with that Brahmins, though I’m pretty sure people would have outraged about a restaurant with a (upper) casteist name in these times. Some hypotheses go that this restaurant was started by disgruntled employees of the “original” Brahmins. Anyway, it doesn’t matter since the food here is pretty good (though not as good as at the original Brahmins).

This restaurant has aped a large number of features from the “original” Brahmins. The first is a limited menu – there are only some five or six items made daily. This is usually a good feature of fast food restaurants since it results in aggregation of demand and lower wastage, resulting in lower costs. It also results in significantly quicker service since there are only so many “lines” that need to be maintained in the kitchen.

The other feature this has aped from the “original Brahmin’s” is that there is no sambar. While this might shock Tamilians and North Indians, it’s a fairly normal thing in Bangalore. In fact, Sambar with breakfast is not normal for Bangalore, and most “traditional” restaurants only serve chutney. The advantage of this is (as Pavan pointed) that people can hold their plates in their hands (chutney is cold, unlike hot sambar), so you don’t need that much table space!

There are normally six items on the menu in the duplicate Brahmin’s (apart from beverages) – idli, vada, kesribhath, kharabhath, “ricebhath” (a redundant term like Avenue Road, I know; and this is only served during lunch. It’s a catchall term encompassing “tomato bhath”, “veg pulao”, puLiyOgare, chitrAnna, etc.) and masala dosa. And the odd man out is the last one for the rest are “made to stock”. Masala dosa is usually “made to order” since its quality “decays” quite quickly after it’s made.

It was pleasantly surprising to see a board saying “no masala dosa on Saturdays and Sundays” when I went to duplicate Brahmin’s this morning. The restaurant was already fairly crowded when I went, and there was a queue about five people long at the cash counter. The restaurant is designed in a way that there is this one not-so-large counter across which everything (coupons, food, beverages) is served, and there was a crowd today at every part of the counter (only the cash counter had a queue, at the rest of the places people just crowded around).

That’s where the “no masala dosa on weekends” board makes sense. With the dosa being made to order, people have to linger around the  counter once they’ve handed in their order until they have received their dosa. And given the rather small size of the counter and the weekend crowds, this simply leads to unnecessary crowding and shoving. It also seems like the demand for Masala Dosa at duplicate Brahmin’s is not high or predictable enough to warrant making it to stock. And hence, it’s a rational decision to ration the supply of dosas (to zero) on weekends.

The question is why the restaurant makes dosas at all (on weekdays), given that the original Brahmin’s doesn’t. The answer to this lies in a cost-benefit analysis. On weekdays, the supply chain is not tight and there are no people crowding at the counter. This means that the strain imposed on the system by people waiting around for their dosas is not too high.

Studying fast food restaurants can be a fascinating exercise.

 

Liquidity

In economic theory, outside of capital markets, “liquidity” is a topic that isn’t spoken about as much as it should. While I’m no academician to set this right in theoretical circles, I’ll make an attempt to help my readers what the fuss is all about.

Well past midnight, when you exit a mall after having just watched the “second show” of a movie, you will find a bunch of auto rickshaw drivers who accost you. Without exception, each of them is likely to quote an exorbitant price to take you home. As the night goes on, there is a reasonable chance that some of these drivers will have to move away from the mall, unable to have found a customer for the night.

Two months back, I was looking to purchase a high end laptop. I walked the high streets of Bangalore, going to every big and small computer store I came across. Each brand had a maximum of one laptop that fit my requirements. I ended up purchasing the laptop I’m typing this post on in the US (got a cousin to bring it in for me).

In London in 2005, a sandwich at Subway cost less than two pounds, while a Masala Dosa at a half-decent restaurant cost at least seven or eight pounds. In Bangalore today, a first rate Masala dosa won’t set you back by more than thirty rupees, while a standard unexceptional “sub of the day” at a subway costs over twice that amount.

All the above cases of pricing anomalies or market failures can be ascribed to “lack of liquidity”. In financial literature, liquidity is defined as an asset‘s ability to be sold without causing a significant movement in the price and with minimum loss of value (source: Wikipedia). From a practitioner’s standpoint, liquidity is positively correlated with the amount of activity that is happening in the market – the more the buyers and sellers for a particular security, the less the “transaction cost” you incur in selling it.

Auto rickshaws in the middle of the night, dosas in London, subs in Bangalore and high end laptops in India – they are all examples of markets that (by the above definition) are highly illiquid. In each of the above markets, the number of buyers and sellers at any point of time is low (relative to other comparable markets – such as auto rickshaws in the evening or dosas in Bangalore). Thanks to that, the “bid ask spread” (my apologies for continuing to use financial jargon. Bid ask spread refers to the price between the highest price a buyer is willing to pay and the lowest price a seller is willing to accept) is high, and consequently, buyers end up paying a high price, or in some cases, sellers end up not realizing a high enough price for their good.

Now, why should this happen? Doesn’t it sound counterintuitive if I say that “there isn’t much demand for subs in Bangalore, hence the price is high”? The fact is that when I say that “there isn’t much demand” I omit saying that there isn’t much supply also. This calls for further explanation.

Let us imagine a world where it is impossible for a buyer and a seller to interact directly to conduct a sale (this sounds like dystopia, but let us imagine a situation like that). In this world, there are a bunch of “specialists” called “market makers”, whose only job is to buy and sell goods. So if you are the seller of a particular good, instead of finding a buyer, you sell it to a market maker, who takes the risk of holding on to your good (carrying cost, possible damage, risk of sudden fall in value of that class of goods, etc.) until he has found a seller. Similarly, if you want to buy something, you only contact a market maker.

When there are a large number of buyers and a large number of sellers for a particular good, the costs of making markets is low. Due to the number of buyers, the average length of time a market maker has to hold on to the good is low, which automatically reduces the risk of making markets in this particular good. Since the cost of making markets in this good is low, more market makers will want to make markets for this particular good. Their competition lowers the bid-ask spread (refer to definition above), and thus both buyers and sellers will realize a price that is close to the true market clearing price.

Now what happens when there are few buyers and sellers for a good? Very few market makers will want to trade in this good, since the risk of holding on to these goods is significantly higher. Consequently, there is less competition among market makers and the bid ask spread remains high (while it is a fact that the cost of market making is also high for these goods, the lack of competition in market makers further pushes up the spread). As a seller, you now have much less choice in terms of buyers for your good, so you end up accepting a rate much lower than true market clearing price. Similarly, as a buyer, you end up paying exorbitant prices.

Now let us get back to the real world where buyers and sellers can actually interact. It can be seen as being similar to the above world, but with the change that buyers and sellers are their own market makers! The cost of making markets comes into play here. As a seller of auto rickshaw services outside a mall past midnight, you know there is a risk of not finding a buyer for your services. You try and price in this risk in the price you quote, and you end up asking for more than the market clearing rate, and there is a good chance there will be no takers for that rate, until you get desperate about finding a customer and quote something below the clearing rate. If you are looking to hail a rickshaw outside a mall past midnight, you are wary of being stranded there without a ride home, so you end up paying much more than the true clearing price.

Several examples of this nature abound. Like how real estate prices are “sticky”, and builders refuse to drop prices in the face of falling demand (note there that real estate brokers are not market makers – they don’t take on the risk of holding on to the asset). Like how I get suboptimal rent for the house that I own in Kathriguppe in Bangalore, only because there aren’t too many people who want to rent a 3BHK independent house. And how apple products are almost a fourth more expensive in India than in the US.

Moving briefly from micro to macro economics, GDP grows when there is more economic activity, or when there is more trade. One way of increasing GDP is to foster trade. However, a large number of goods and services that people need, or that people want to provide, are “illiquid” (that includes Quant consulting –  which is what I do. There aren’t too many of my ilk around, and no too many organizations interested in buying these services). One way of fostering internal trade, and thus economic growth, is to reduce the cost of market making. When it comes to goods, VAT, in that sense is a step in the right direction since at each step it is charged only on the marginal value added – and thus the presence of an intermediary doesn’t increase the total cost by too much. Stamp duty on real estate, however, is a bad idea. By charging a full tax on every transaction, it dissuades market makers in the sector, and thus keeps markets illiquid and opaque. The worst of all, though, is Agricultural Marketing, where by law the APMCs have monopoly in making markets in agriculture. Now you know why the farmer continues to suffer even though retail prices of agricultural products have been going through the roof.

Ok I end this post with that digression into macroeconomics. However, I do hope that I’ve been able to explain to you why illiquid products are costlier (if you’re a buyer that is)! Let me know in case you have any questions.

Update

This post came about as a result of a twitter conversation earlier today with Dhiren and Pavan. Giving credit where it’s due

Going Global

Ok the second word in the title doesn’t refer to B-school slang. It means “global” in the true sense of the word, and has nothing to do with what my father used to call as “bulldology” (derived from the kannada word “bullDe” which essentially means “globe” (in the B-school sense) )

Ok so the story goes back to 2003, when I headed my way north all the way to Delhi, to intern at IBM Research. I would be staying at the IIT Delhi hostels during the course of my visit. I traveled by Rajdhani express, and had rotis and dal makhni through the journey. And in the mornings I’d get a flask of hot water along with “chai saamagri” (tea bag, sugar, milk powder, etc.)

That was when it hit me that for the next two months I’d be in chOmland, devoid of access to South Indian food, and good filter coffee. I remember getting paneer-fatigue within two weeks of my stay in Delhi. I would salivate at the very thought of going to the nearby “hotel Karnataka” and eating “meals” for a then princely sum of Rupees Fifty. The primary reason I got bugged with my internship was that I wasn’t getting my kind of food, and coffee.

Two years later, I would travel to London, for yet another internship, this time at an investment bank. The day I landed in London, I headed out for lunch with a few friends. Picked up a sandwich, and then it hit me how far away from home I’d come. Sandwich, for lunch! And I was the types who used to say stuff like “bread is for dogs”.

I remember going to this Sri Lankan store in Eastham every two weeks, carrying back “pirated” (smuggled, actually) packets of MTR Ready to Eat food, and frozen chapatis. And every evening I would microwave chapatis and some chOm dal or sabzis. The same chom food that I had so despised two years earlier was “home food” now. Of course every time I went to Eastham I’d also go to this “Madras Restaurant” and thulp madrasi masala dosa.

I don’t know where the knee-bend/point of inflexion happened but on my recent trip to New York, I didn’t have Indian food at all. The rationale being that there are certain kinds of food available in New York that are not easily available in India, so I shouldn’t miss the opportunity of eating them.

So I ate at Turkish, Greek, Ethiopian, Italian, Thai, Israeli, Korean restaurants, quite enjoyed the food, never asked a waiter “does this dish contain meat” (the reason for my vegetarianism is more because I get grossed out by meat, rather than any religious or cultural reason) (and I didn’t feel much when I set aside what looked like an octopus from my salad and continued eating the rest of the salad), never craved sambar, and generally had a good time.

My wife may not be the happiest when she reads this but frankly when I returned I didn’t exactly crave home-cooked Indian food. Of course the Rasam last night was wonderful, but it was now for me just yet another culinary item, just like coconut milk curry, or hummus or the ethiopian dals or pizza.

I seem to have truly gone global (again no pun intended)

MLTR

This has nothing to do with any pop group, or any Michael or anyone learning to rock. It’s about this awesome easy-to-miss long undiscovered eatery in Gandhi Bazaar. You should definitely eat at Mahalakshmi Tiffin Room.

Situated on DVG road between Gandhi Bazaar main road and North Road it’s an old-style sit down restaurants. Small marble-topped tables with benches. Communal seating where strangers can share your table. An ancient cupboard displaying “cool drinks”. Blue walls. Waiters in dhotis. A small section cordoned off with the sign “families only”.

And divine food. Really awesome masala dosa (real masala dosa, not the species served at Vidyarthi Bhavan). Soft and oil-free khali dosas (yeah the restaurant is so old; they call it khali dosa and not set dosa). And strong coffee. And all served quicker than you could look around and take stock of the place.

I had been walking past the place for several years but it was only when Priyanka noticed it when we walked past it last April that I actually ate there. We had shared a masala dosa and a coffee then. And were so impressed that we left a 33% tip.

And it so happened that the same waiter Raju was there when we went last weekend. Again quick and efficient service. Awesome dosas. I think they make to stock the khali dosas – for they arrived within half a minute of our ordering.

Oh, and they have a weekly off on Saturdays.

Vidyarthi Bhavan

Ok I give this one to North Bangalore. The best masala dosa in town is found at CTR in Malleswaram (ok I’m going by one data point, haven’t been there more often). The thing that goes by the name of masala dosa in Vidyarthi Bhavan is a completely different animal. It is thick, it is literally deep fried, and tasty, yes. But it’s not a masala dosa.

The problem with restaurants having “flagship dishes” (like the masala dosa at either CTR or Vidyarthi Bhavan) is that you are usually loathe to try out their other dishes which could be quite tasty as well. For example, the idli-vada at Vidyarthi Bhavan is quite good, and I’m told that the rava vada is awesome (unfortunately I went there on a weekday morning when they don’t make rava vada). And I don’t know if it’s good business practice for restaurants to have a “flagship dish”.

Coming back to “real” masala dosa and Gandhi Bazaar, you should definitely go to this quaint old little place called Mahalakshmi Tiffin Room on DVG Road, between Gandhi Bazaar circle and North Road. It’s a fairly old-fashioned place, doesn’t serve sambar with masala dosa (only chutney), happily serves one-by-two masala dosa and is generally not very crowded.

It is one of those places with a wooden door, with a wooden shelf in the corner which has pepsi, mirinda, etc. The service is quick and efficient and the food is tasty.

Of late I’m not too impressed by the masala dosa at Adigas, which not so long ago I used to absolutely crave (for example, when I returned to Bangalore after a 10-week trip to London 5 years ago, I went to an Adigas for masala dosa straight from the airport. Now it doesn’t seem to be all that worth it). Or maybe I’m biased in my opinion because the Adigas I most frequent is the one at Embassy Golf Links, where my office is located.

Oh and I need to mention here that I absolutely loathe the Madras masala dosa, the thing that is white and not very crisp, with soggy palya and served with some three varieties of chutney, and flat sambar.

CTR

Ok this is a post that has been delayed by about a couple of weeks. One of those things that has been in my head now for a while so writing it. So some two or three Sundays back (more likely to be two) I went to the famous CTR in Malleswaram for breakfast. For the first time ever. Yeah I now it’s supposed to be a classic place and all that but it’s only now that I’m getting acquainted with north/west parts of Bangalore so had completely missed out on this so far.

So as per what several people had told me at various points of time in life, the Masala Dosa at CTR was brilliant. Unparalleled. The difference between CTR and Vidyarthi Bhavan is that the former makes masala dosa just the way that other restaurants do, but only much better and tastier. The dosa at Vidyarthi Bhavan is a different animal altogether and am told the has very different composition to what is made in other restaurants.

There is another important difference between CTR and Vidyarthi Bhavan and thats in terms of service and crowd management. Vidyarthi Bhavan does an excellent job in this regard, striving to “rotate table covers” as quickly as possible. Within moments of you taking your seat, your order gets taken, the dosa arrives, as does the bill and a look from the waiter asking you what the fuck you are doing there considering you have finished your tiffin. Extremely efficient from the point of view of the restaurant (in terms of maximizing capacity) and for customers looking for a quick dosa, but not so from the point of view of people who want to linger for a while and chat.

Unfortunately the one time I’ve been to CTR (2 sundays back) I was in a bit of a hurry since I had to go attend a quiz. Maybe the intention of the restaurant is to allow customers to sit for a while and chat up, but I don’t know if you can actually do that since at any given point of time (reports might be biased since this was a Sunday morning, 9am) there are four people waiting for you to leave so that they can grab your seat. This large crowd that is in waiting is also I think a result of slow service at the restaurant (simple queuing theory – for a given arrival rate, the slower the service rate, the more the average queue length).

There were some simple tasks in which CTR didn’t do so well. For example, making a customer wait for ten minutes before you take his order is not only ten minutes wasted for him, it is also ten minutes of absolutely unproductive “table time” – something that a fast food place like this can’t really afford. And then the ordered items also took a long time to arrive (again, most people at CTR have the same order – one “masaal” so I do hope the make dosas “to stock”) – but then their kitchen capacity may not match up to the capacity of the seating area (which isn’t too much). You pay bill at the table itself rather than at the counter which means you sit there for even longer. And so forth.

This post is supposed to be a part of this series that I was writing some four years back examining the Supply Chain practices and delivery models at various fast food restaurants in Bangalore. I have only one observation with respect to CTR and based on that I don’t give it very high marks in terms of supply chain and delivery efficiency. However, the dosa there is so awesome that I’m sure that I’ll brave the crowds and go there more often and might be able to make better observations about the process.