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Big bites in small cities: Why posh restaurants are looking beyond metros

A Hoppipola in Ranchi, a Farzi Café in Chandigarh, a Flying Saucer Café in Lucknow, and a Mocha in Raipur. Tier-2 cities are developing a taste for big-city dining, changing the way India eats out.

more lifestyle Updated: Oct 13, 2018 20:13 IST
Weekend reads,Long reads,Tier-2 cities
A favourite with under-25s and present in six other cities, Hoppipola is Ranchi’s first restopub. It also has a microbrewery, Jharkhand’s first.(Sanchit Khanna/HT PHOTO)

In a quiet lane, sandwiched between old houses and a puri-bhaji stall, is the Nucleus mall, one of four shopping malls in Ranchi, a city of over 10 lakh. The malls have long been popular for their cinemas and cafés. But Nucleus is now also home to Hoppipola, a casual-dining restaurant and bar, popular with under-25s that is part of a chain with outlets in six other cities.

It’s Ranchi’s first restopub, and it’s been greeted with considerable excitement. “Every time I visited Hoppipolas in Mumbai and Pune, I would wish we had such pubs at home,” says Ranchi-based fashion designer Swastika Stuti, 25. “There was only one sports bar in the city before. So, when I saw a billboard about Hoppipola opening in Ranchi last December, I was very excited. My friends and I visited five days in a row the week it opened.”

Hoppipola caters to the moneyed Ranchi youngster. It has velvet couches, selfie corners, dim lighting, and cocktails with naughty names like Sex On The Roof. It also has a microbrewery, Jharkhand’s first.

“The young people of Ranchi, who have corporate jobs or have moved from neighbouring towns for higher studies or hail from affluent families, would earlier go drinking to four-star hotels. Now, they are coming here,” says manager Koustav Ghosh.

Avik Chatterjee, head of innovations and new formats at Speciality Restaurants (which also owns the Oh! Calcutta and the Mainland China brands), says they wanted first-mover advantage. “Ranchi is an educational hub and ‘pubbing’ is catching on.” They plan to open them in Lucknow, Chandigarh, Indore and Bhubaneswar.

“Today, the business potential of Tier-2 cities is as much as that of big cities. It’s possible to turn a profit because the overheads are lower. Rents, for instance, can often be four times lower than that in a city like Delhi or Mumbai,” says restaurateur Zorawar Kalra

Restaurateurs battling high rent, space crunch and a saturated market on the Mumbai-Delhi-Bengaluru circuit are expanding to smaller cities. Not only are eateries cheaper to operate, the millennials there are hungry for novelties like ricotta ravioli, khow suey and chipotle burgers.

THE BIG BOOM THEORY

As they expand to smaller towns, restaurateurs are localising the menu and decor and hiring local staff.

Earlier this year, restaurateur Zorawar Kalra opened the ninth outlet of the modern-Indian bistro, Farzi Café, at the Radisson Jaipur City Center in the heart of the Pink City. Locals and tourists drop in for dressed-up versions of traditional foods like the Rajasthani pyaaz ki kachori and ghewar. Their version of the kachori is bite-sized, topped with masala jackfruit and aloo rassa reduction. The ghewar, usually heavy, is reinvented as a creamy tart with foamy saffron air.

Farzi’s next stop is Lucknow, where it opens this month. Kalra has also included Indore, Siliguri and Belgaum in his plans.

“Today, the business potential of Tier-2 cities is as much as that of big cities. Sometimes, restaurants in smaller cities outperform those in the metros,” says Kalra, founder and managing director of Massive Restaurants, which owns Farzi Café among other restaurant brands.

In February, Delhi’s party hub The Flying Saucer Café launched in Lucknow. With a sprawling space of 8,000 sq ft, plush leather couches and subdued lighting, the cafe replicates its Delhi vibe in the Tier-2 city.

Meanwhile, in January, Chandigarh welcomed its first Social. Riyaaz Amlani, the man behind popular chain (Mumbai alone has 10 Socials), has also opened outlets of his other brand Mocha Café and Bar (born in Mumbai in 2001) in Kanpur, Raipur, Guwahati and Nagpur.

MAKING IT COUNT

In February, Delhi’s party hub The Flying Saucer Café launched in Lucknow. With a sprawling space of 8,000 sq ft, plush leather couches and subdued lighting, the cafe replicates its Delhi vibe in the Tier-2 city. (Dheeraj Dhawan/Ht Photo)

“The purchasing and spending power of Tier-2 cities is increasing rapidly and so is the demand for places such as ours,” says Priyank Sukhija, CEO and MD of First Fiddle Restaurants, which manages The Flying Saucer Café along with other brands like Tamasha and Lord of the Drinks. “Metro markets are exhausted. The name and vibe that we have established in Delhi and Mumbai for our brands is also talked about in smaller cities. We receive requests for franchisees and collaboration because people want this vibe there.

Does that mean locals in Tier-2 cities are eating out as much as their metro counterparts? Not really, says Amlani. “On average, in Mumbai and Delhi, a person dines out eight times a month. In Tier-2 cities, they may eat out only four times a month.”

Yet, adds Kalra, it’s possible to turn a profit because the overheads are lower. Rents, for instance, can often be four times lower than that in a city like Delhi or Mumbai.

“With the penetration of social media in smaller towns, people’s preferences are becoming universal. A food trend would take five or six years to catch on in a Tier-2 city. Now, it takes a year,” says restaurateur Riyaaz Amlani

The monthly rent of The Flying Saucer Café outlets at Connaught Place and Nehru Place in Delhi amount to Rs 18 lakh. The Lucknow counterpart operates at Rs 6 lakh. “The salary brackets are also lower. So, while a Delhi outlet might do 25% more business, the profit margins in Lucknow, will roughly be the same,” says Sukhija.

According to Amlani, the restaurant boom in the Tier-2 cities began in the late 2000s. His company Impresario first took Mocha to small cities like Pune, Guwahati, Indore, Agra, Ahmedabad and Nagpur. Four years ago, they also opened the café in Raipur in Chhattisgarh. Soon, they will set foot in Gandhinagar and Bhopal.

He attributes this expansion to the changing lifestyle of non-metro diners. “With the penetration of social media in smaller towns, people’s preferences are becoming universal. So, it’s no longer true to say that people in non-metros aren’t as experimental,” he says. “A food trend would take five or six years to catch on in a Tier-2 city. Now, it takes a year.”

At Mocha outlets in smaller towns, Asian dishes like Burmese khow suey and Thai green curry are just as popular as they are in the big cities.

KEEP IT LOCAL

In small-town restaurant editions, about 20 to 35% of the menu is customised to local palates. A modernised version of sarson ka saag-makki roti served as a Turkish pide at Farzi Café in Chandigarh. (Karun Sharma/HT Photo)

In small-town restaurant editions, about 20 to 35% of the menu is customised to local palates. Farzi Café in Chandigarh modernises the homestyle sarson ka saag-makki roti by filling up a boat-shaped baked makai mooli pide, inspired by the Turkish bread, with the saag made using bathua (pigweed) and sarson (mustard). “The idea is to create a new experience for the diner, even if they’ve been having these dishes at local dhabas,” says Tanvi Kataria, marketing manager, Massive Restaurants.

The decor makes allowances for social dynamics too. “We found that in Chandigarh, groups of youngsters and families come to the same place,” says Aayushi Malik, the company’s in-house architect and designer. “We sectioned the restaurant to offer privacy to each segment.”

Unlike the other Hoppipolas, the one in Ranchi has a cover charge (Rs 500 on weekdays, Rs 1,500 on weekends). It also has more bouncers; eight, to Mumbai’s three. And there’s no entry for stags so female patrons are not harassed.

COURSE BY COURSE: HOW INDIA STARTED EATING OUT
  • The pre-Independence era witnessed the launch of restaurants like Flurys (Kolkata), Karim’s (Delhi) and Leopold Café (Mumbai).
  • As people migrated to cities for work, there was a spurt in smaller eateries – like Udupi restaurants in Mumbai – serving freshly cooked food. The moneyed went to five-star hotel restaurants.
  • The middle-class began eating out in a big way from the 1990s. They had higher disposable incomes, dual-income families and an aspiration for a Western lifestyle.
  • The entry of McDonald’s in 1996 galvanised the Quick Service Restaurant (QSR) format.
  • By the 2000s, chains like Café Coffee Day, Barista and Mocha ushered in a café culture.
  • In smaller cities, the demand for restaurants came in the 2000s as the towns got more urbanised and residents could afford to go out more often, suggests a 2017 report by management consulting firm Technopak, in partnership with FICCI.
  • The report adds that two mega metros – Delhi and Mumbai – contribute to 22% of the food services market.
  • Six mini-metros (Ahmedabad, Pune, Chennai, Kolkata, Bengaluru and Hyderabad) constitute 20%. The remaining 58% is from 21 cities – Jaipur, Lucknow, Surat, Nagpur, Kanpur, Indore, Patna, Chandigarh, Kochi, Coimbatore, Vadodara, Ludhiana, Nashik, Varanasi, Madurai, Visakhapatnam, Bhopal, Amritsar, Rajkot, Trivandrum, Goa – and the rest of India.

At 7 pm on a Wednesday, three tables are occupied by the patrons all in their early 20s. Several are dressed in traditional wear. It’s a marriage of cultures that is visible in the menu and the decor.

“Among the most popular selfie spots is the smoking area on the terrace,” says Srijesh Kollum, 23, who is on the wait staff. “It’s a tiny space that is also quite windy, but people squeeze in to smoke and get hairflowing selfies with a cigarette.”

Commerce student Ujan Kalwa, 22 is a regular. “I am glad that Ranchi has moved beyond cafés,” he says. “Here we can finally get a couple of drinks, good Bollywood music and fancy food.” The venue is popular for corporate lunches and birthday parties, events that would otherwise be held in banquet halls and mall food courts.

The owners are also hiring local staff. Some simply return to the hometown editions of the city restaurants they’d worked at. Others find opportunities closer home.

Hoppipola has helped the local DJ Aakash, 25, get a permanent job. While most DJs in small towns live in fear of offending a local patron by not playing his favourite filmi number, Aakash says he gets to spin hip-hop to help it get better acceptance in Ranchi. “I mix hip-hop with Bollywood, because my customers love Bollywood songs.”

TAKING RISKS

Restaurateur Riyaaz Amlani took the franchising route to launch Mocha Café and Bar in small cities like Guwahati. ‘We vet each franchise owner and dismiss those who are only interested in bragging rights,’ he says. (Dhruba Dutta / HT Photo)

The need for resourceful, local partners is driving restaurateurs to opt for franchise models in Tier-2 cities. “We vet each franchise owner,” says Amlani, who has adapted the model for the expansion of Mocha Café. “We dismiss those who are only interested in bragging rights. They need to view it as a serious business.”

Other challenges include sourcing skilled manpower, specialised kitchen equipment and ingredients like porcini mushroom or bhut jolokia, which may not be available in a small city. So expenses can rise by 10%, say restaurateurs.

Smaller cities are also picked based on their ease-of-business in terms of licensing. And Gujarat, being a dry state, remains off the radar for most restaurants that are driven by alcohol sales.

The main risk is ensuring a common standard in cities big and small, says Rahul Singh, president, National Restaurant Association of India (NRAI) and founder-CEO of The Beer Café, which is present in 11 cities, including Mohali, Ludhiana and Amritsar. “A customer expects the same experience. He visits your restaurant because he has seen you in a bigger city or at least heard about you,” he says. “In a big city, patrons can flit from one restaurant to another. In a smaller town, loyalty matters. A restaurant’s occupancy rate is lower than in a metro. So, if you don’t offer great food and vibe, you will lose your customer and it will affect business.”

First Published: Oct 13, 2018 20:08 IST