Carl’s Jr is among the more recent foreign QSR brands entrants to India. The American fast food brand is known globally for its chargrilled burgers and for its focus on bringing healthier food to the table. It is this ethos of healthy dining, innovation and setting a lifestyle trend to eat fast food in a healthier way that Carl’s Jr wants to replicate in its India operations.
FoodService India speaks to Sana Chopra, Executive Director, Carl’s Jr. India, about the novelty quotient that the American chain has to offer to Indian fast food lovers and its game plan for increasing its footprint in the country. “We have an aspirational target demographic of young and hungry guys and girls between the ages of 18 and 40,” she says adding that the chain will focus on providing guests a superstar service with great ambience, music, access to unlimited refills, among other things.
Please describe the positioning of Carl’s Jr in the Indian QSR market, what is its USP and the special features of its burgers and other fares compared to those available at other QSR chains?
Carl’s Jr is a premium quick service restaurant when it comes to products, service or ambience. As a brand, Carl’s Jr and our sister brand Hardee’s are known to serve its guests premium products made from a variety of fresh and healthy ingredients that lead the industry in taste, quality and innovation. In India too, Carl’s Jr offers its guests a range of products. Some are designed to meet the Indian palate, some are our signature flavours, while others are completely new and interesting flavours that are not even present in any of the other Carl’s Jr or Hardee’s markets! Globally, we are known for our chargrilled burgers and our main focus is on bringing healthier food to your table.
How did you hit upon the idea of bringing this brand to India, and where did you see the market gap for your kind of offering?
When my father and I were looking to bring a food and beverage brand through CybizCorp into India, we looked at several different food and beverage chains. We travelled to different headquarters across the globe, met their company figureheads, learnt about the different brands, visited their kitchens, etc. At the end of all the research, the Carl’s Jr/Hardee’s brand just stood out to us, and in so many different ways. The focus on premium quality ingredients and food, the strong quality assurance team, the brand mottos, ethos and, of course, the quirky advertising, etc., everything touched a chord. Carl’s Jr is a pioneer in the burger industry with its many “firsts”. For instance, it is the first burger chain to have real ice-cream milkshakes, serves Jalapeño burgers or low-carb lettuce wrap burgers. We loved how Carl’s Jr was innovative and continuously striving to make the dining experience a healthy one.
What is it that a customer visiting a Carl’s Jr restaurant can expect in terms of a complete breakfast or meal solution? What is your value-for-money proposition for diners?
We are known globally for serving big, juicy and bold burgers made from premium and fresh quality ingredients. When a guest walks into Carl’s Jr they can choose to customise their meal to their liking. We provide combo meals, which cover the classic burger, fries and different types of soda combination. We also provide combo options for crispy chicken legs/wings and beer. Besides customising your product mix, we allow our guests to double or triple their patties, swap to our honey wheat or lettuce-wrapped buns, choose an iced tea or coffee with their meal.
How much of Indianisation or localisation are you prepared to do for the Indian market?
We have done extensive research and development and come up with a menu that caters to guests who are biased to Indian flavours as well as non-Indian flavours. On the one side, we have a chargrilled tandoori pepper chicken filet burger or a chargrilled paneer tikka burger, which are spicy and have very authentic Indian flavours. On the other side, we have a mango jalapeño pepper chicken fillet burger, which is a new product not just in any burger restaurant in India but also for Carl’s Jr globally. Specially developed for the Indian palate but a completely non-Indian flavour, this is definitely unique and flavourful. Similarly, we serve wasabi fries on our menu. This Japanese mustard flavour adds a punch to the fries that is so different from a regular “masala”, yet it satisfies that need for a hot accompaniment to the fries. We have especially developed this seasoning to introduce our guests to a whole new concept and way of eating their fries. Even with our hand-scooped ice-cream milkshakes, which are made with real ice-cream and not powdered pre-mixes, we’ve got new and exciting flavours like tiramisu and piña colada, which are unique to the Indian market.
As I said, Carl’s Jr has been a place for many “firsts”. Even in India, we are the first to start serving a low carb, lettuce wrapped or “green” burger as Carl’s Jr in other markets does. While we are constantly innovating, we strive to be aware of the changing palate or trends in a country as unique as India.
What is your business model in India and how have you gone about pricing your products?
Initially, all the restaurants will work on COCO model, i.e. company owned and company operated. But later on, we will venture into FOCO, i.e. franchise owned and company operated. Eventually, we will also award FOFOs, i.e. franchise owned and franchise operated, to large multi-unit sub-franchises.
With the amount of research and development done to build the menu, adapt and develop processes and ultimately replicate the brand in India, an operator or master franchise learns the business inside out. We want to be able to build the brand as much through a COCO model, then slowly release first ownership responsibilities, and then ownership and operational responsibilities. Larger multi-unit sub-franchises will have the resources to systematise their processes and stay true to the brand. So in a lower involvement model, Carl’s Jr would be able to maintain its standards.
With regards to price, we believe in the value-for-money proposition and this appeals to our target audience. Our burgers are very big and juicy, yet prices begin at just Rs 99. Our drinks (even beer or refillable drinks) are priced similarly.
Which customer segments are you targeting?
We have an aspirational target demographic of young and hungry guys and girls between the ages of 18 to 40. But our products appeal to the burger lover in all of us, no matter what’s one’s age. We like to believe our psychographic target of young hungry guys and girls will more closely resemble the consumer base that visits our restaurants. Our Indian consumer base is younger than other markets and we see tremendous growth in a youthful middle class whose lifestyle requires the convenience, quality and service platform that our brand provides.
What is your current restaurant count? Which are the markets you are looking to expand into?
Currently we have three restaurants in Delhi/NCR. One behind Select Citywalk Mall, Saket, in South Delhi, another one in Pacific Mall, Tagore Garden, in West Delhi, and the third one is coming up this month in DLF Mall of India, Noida.
We plan to open 100 restaurants in the next 5-7 years. We are initially looking at expanding in the Delhi-NCR region. Our next step would be to expand in Chandigarh and other cities in Punjab. Then we will move to Mumbai and West India.
What do you feel are the challenges of opening a new QSR brand in India?
Obviously, opening up a new QSR brand in India is not easy. A lot of hardwork and research goes into it. For example, there were months and months of R&D that went into implementing our final menu. Even after the opening, one’s challenges are not over. Ensuring customer satisfaction on each transaction is utmost priority. Ensuring that every guest leaves with a bigger smile on their face than when they came in is the ultimate goal.
Continuously selling value-for-money products by providing superstar service and ensuring that the guest leaves thinking that the food experience had value for money and the service was of superior quality, is very important to achieve. Thirdly, maintaining standardisation and quality controls and ensuring that standardisation is maintained within the restaurant and among franchisees as well with all the quality controls in place is a big challenge. Lastly, maintaining a steady brand presence, especially in the nascent stage, is critically important and can be a challenge for a brand.
Can you offer us examples of some innovative F&B ideas that you plan to implement in the days ahead?
In today’s world, especially in India, F&B chains are constantly coming up with offers, products or other innovation to maintain steady footfalls. The biggest innovation Carl’s Jr has brought already is a large chargrilled menu to India. For the health-conscious, innovation seekers, and other guests in general, this is a huge step towards setting a lifestyle trend to eat fast food in a healthier way. Recently, we came out with low-carb burgers, which I have mentioned already, and we also have a few menu developments in the pipeline, which will be innovative and new for our audiences. Even with regards to our marketing efforts, we have come up with innovations like Drink Free For a Year Campaign (DFFAY), which allows a customer to leverage their DFFAY card and be able to purchase a burger and get a drink free once a week for an entire year! While the DFFAY campaign was a big-scale campaign, there are certain marketing innovations that we are looking to explore soon.
What do you think will be the new innovations to the QSR format in India?
I do believe that free refills or serving beer in QSRs is something that could soon be the next trend, which Carl’s Jr has already brought in. Having said that, the QSR space is constantly evolving, especially in India. Takeaways seems to be growing as a segment by 20 per cent. With greater travel and connectivity, Drive-Thrus are also becoming popular. Serving liquor in what seemed to be considered family restaurant spaces is also on the rise, which we highly endorse especially since we are the first QSR to do so.
Why is it that despite Indian food being popular in many countries, no Indian QSR has been able to go beyond twenty or so restaurants whereas foreign QSRs spawn thousands of restaurants all over the world?
There are several factors that affect growth: SOPs, management and marketing are a few such. What foreign QSRs, and in a large majority US-based QSRs, are good at is building their standalone restaurants to a level that they are not just serving good food and providing good service but also have been able to reach a level that they are in a “franchise-ready” state. I’m not necessarily alluding to franchising but to a state of being ready to replicate.
There are several things that need to fall into place before such growth is possible in a market. Things like having consistent recipes, optimised equipment, best practices, negotiated rates from suppliers and vendors, consistent delivery of ingredients, packaging, and other things. Simply put, everything is set up by the first 2-3 restaurants. Secondly, there has to be interest from the management to pursue growth as not just a secondary activity but to consider that as a vertical within the organisation itself. By setting up the right SOPs, having an engaged team, being proactive in marketing and searching for leads, helps an organisation grow.
In today’s day and age, marketing has helped make some brands popular as aspirational brands, some for social statements, some for health benefits, some for just quirky advertisements. As consumers in foreign markets are constantly hearing about these in this growing social media age, education about these brands continues to grow. When it reaches a certain threshold, individuals and organisations help foster its organic growth and bring it to another market. I believe that the lack of connectivity through social media for such marketing, development of SOPs, and the absence of a constant pursuance of growth could be potential hindrances in the growth of Indian QSRs. Without a franchise-ready restaurant chain, without a keen and aggressive management, and without the transfer of information through social platforms, no QSR can expand rapidly within its own country or overseas.
Considering the peculiarities of the supply chain in India, have you introduced any specific innovations to make your back-end operations foolproof?
We source all of our food and packaging materials locally. Our supply chain and quality assurance teams have been in the market over the past three years identifying suppliers and ensuring that they meet our global quality control and food safety standards. We establish specific standards for each inventory item and hold our manufacturers accountable to achieving these standards. We also audit our suppliers using both an internal and third-party network of quality assurance professionals.
How do you look at the home delivery service that QSRs are getting into? How much of online sales are you doing currently and how do you see this segment growing for you?
Positioned as a premium QSR, Carl’s Jr primarily believes in the philosophy of providing a customer a good dining-in experience. We focus on providing guests a superstar service with great ambience, music, access to unlimited refills, etc. So while we believe that experience-wise going out with your friends and family provides the ultimate dining experience and it is what we encourage, we understand the growing trend in India for home delivery systems. Having said that, while we do not provide delivery yet, we are also not opposed to it. In some markets across the globe, Carl’s Jr. does deliver via third parties. This segment is growing now in India and when the time and process are right, Carl’s Jr in India will also look into it.