Prawn Crunch, a value addition of farm fresh seafoods, catches consumer fancy as a welcome low fat food option in Hyderabad market against the regular chicken and mutton fare. Rahul Reddy, its master franchisee for Andhra Pradesh, runs its successful stores with an eye on expansion. Roshna Chandran reviews the business.
“It is very rare to get seafood in a place like Hyderabad,” says E Rahul Reddy, who saw an opportunity with Prawn Crunch. He noticed the growing health consciousness among the city’s youth who loved their biryani, kababs and chicken, but preferred good non-veg low fat food. Seafood can fit the bill, he was convinced and set a Prawn Crunch (PC)outlet.
PC’s grilled fish and prawn biryani are its fastest selling items on the menu, and definitely healthier than traditional spicy chicken and mutton fare.
PC was started in 2009 by Kedarnath Reddy, Manager – Business Development of Farm Fresh Seafood. It has five outlets present in Bangalore, three in Hyderabad and one in Chennai.
The brand has tied up with Custom Culinaries and Griffith Laboratories for all marinations and solutions. It is currently growing at 20 percent per annum, and has a turnover of Rs 1.2 crore.
PC’s “plug and play” franchise model requires Rs 5-6 lakh investment and takes 15 to 30 days for setting up an outlet, depending on the location and rented space. The investment covers design fee, basic equipments like the chillers, fryers, grill, microwave, billing machine, neon backdrop menu, false kitchen ceiling, stationary and crockery.
A franchisee has the choice of either buying the food stocks from the company or set out a margin of 35-38 percent from the net sales, in which case the company fills in the required stocks. Rahul had opted for the first option, wherein he buys the stocks upfront on monthly basis.
“Our outlet takes just 8-10 months to break even,” says Reddy, “We do not need more than 500 sq.ft. – that’s our thumb rule.”
Locations are decided mutually, but Rahul’s better understanding of Hyderabad market helped him in deciding the locations for his PC outlets. His investment for each outlet was between Rs 5 and Rs 6 lakh. Of this, Rs 100,000 each was incurred in store design, Rs 1.7 lakh each in equipment and Rs 1.5- 2 lakh for monthly stocks purchase. Rahul has also invested into three centralised storage units in Hyderabad where seafood is stocked in deep freezers. The storage points are maintained at a very low rentals like Rs 4,000.
His investment included Rs 40,000 -50,000 incurred towards staff salary and water and electricity charges. On the other hand at the corporate office outlet, monthly expenses range between Rs 20,000 and Rs 30,000.
Four to five people are trained and supervised by PC’s company executives every month at each outlet. Says Reddy: “For a 300-500 sq.ft. model we employ three to five people. While the store manager takes care of the store and orders, two employees handle home delivery orders and one works in the kitchen.”
In order to maintain consistency, Rahul keeps a check on food quality through routine inspection, while cleanliness is closely monitored at all outlets.
“Pocket sizes usually dip at month- end and pick up again during the first week,” says Rahul. People tend to spend more in the first week of the month as and when they get their monthly salary.
The walk-ins have been pretty consistent, around 100-150 a day with average ticket size of Rs 135 at malls and Rs 55 at the corporate office. Rahul does a bit of marketing by locally distributing pamphlets and with one- on-one discount offers through Snap Deal. Malls also offer delivery on a minimum order of Rs 500.
To keep the Prawn Crunch market abuzz, Reddy markets all the outlets himself. “I used to depend on flyers and paper inserts and some write up in the newspapers. Now we have come up with networking and social media. Through networking we make offers like, you eat a prawn crunch and if you refer someone, you will get a discount on your third visit. We also give away movie tickets for every Rs 500 spend.”
PC’s DLF outlet records the highest sales. “On first Friday of every month, we make at least Rs 15,000 at this location,” says Rahul. “Fridays record sales of about Rs 30,000, mainly due to some corporate encouraging ‘no-box day’, where employees share a huge meal at the food court rather than carrying home cooked food.”
Challenges in consistency arise when people from Hyderabad, often travelling to Bangalore, find the PC dishes less spicy in Bangalore. Rahul points out that customer’s complaints are dealt with immediately. PC offers boneless seafoodand if any customer finds a bone, he will be paid back or offered another dish.
According to him, food lovers are adding up, especially in Visak and Vijayavada. So the company is planning to add 12 outlets in Hyderabad, Vishakapatnam and Vijayawada in the next 6 months. Out of this, 10 will be sub-franchised where he plans to set an 11 percent margin on stocks. Rahul is looking for sub-franchisees who have a background either in hospitality industry, hotel management or in any food industry.
“People are looking for a change,” adds Rahul,”the health conscious, gym goers prefer seafood.”