How lucrative is the concept of online kitchen?

It has been a roller coaster ride so far for Bueno Kitchen, says Co-Founder of the company, Rohan Arora, Bueno Kitchen is in the food tech space. Arora talks to Food Service India about the openness of consumers to embrace his web/app platform, which offers services that help to order food from the confines of their home and the convenience of getting it delivered right at the doorstep along with real-time tracking…
How did you come up with the idea of Bueno Kitchen, an Internet restaurant business?
The end game for companies in food tech space would most likely be to become a ‘Food Grid’- for both prepared food and groceries. Food is one category that not only is very close to our heart, but also impacts the entire humanity multiple times every day. I and Pankaj Sharma (Founders) were classmates at FMS during our masters. We got in touch with Chef Vipul Arora and Chef Puneet Jain (Co-Founders/ Kitchen Operations), and all of us figured out that we are driven by a common goal of creating a worldclass company in the area of food. That’s how the concept of Bueno Kitchen started off.
In 2012, we came up with Bueno Kitchen as a Global Food Hub by opening an outlet in Cyber City in Gurgaon. In fact,to convert our idea into reality and make it real, we conducted many research (primary ones) starting from December 2012 that carried on till February 2014 even after our first outlet had come into existence. This allowed us to shape to our thoughts into action. Out outlet offered as a one-stop-shop for quality global food delivering option for fresh and healthy gourmet meals ranging from the American, Mexican, European, Italian, Lebanese, Indian & Asian cuisines, right at consumers’ doorstep.
In 2014, we decided to go fully online and brought the concept of Internet restaurant into our venture.
Have finances been one of the critical challenges for you?
Every start-up faces some challenges during the early part of the journey and, so did we. We have already invested Rs 2 crore as the initial funding by friends and family and we are looking for funding from institutional investors and hoping to raise $1 mn in the next few months. It is important to raise fund when you cannot wait for the perfect opportunity, source or time.
How did you simplify the business model?
We have a simple business model. Consumers come to our web/app platform, order global food for current or planned consumption, pay, and we make the food in our/QC partner kitchens and deliver it to the doorstep of the customer with real-time tracking. So, we make money by crafting great food in our kitchens and delivered at consumers’ doorstep, using technology at each step of the entire value chain.
With so many Internet restaurants opening up every day and all harping on business models that look eerily similar, what will make you stand out? What are your genuine USPs and differentiators?
There are many players entering in the online food tech/delivery eco-system and everybody wants to make a mark by going beyond the rules and doing something out-of-the box. But one has to keep in mind that it should be customer-friendly because ultimately what we aim for is customer satisfaction and Bueno’s USP is complete control on product and user experience: ordering, products and delivery (owned or franchised).
We will stand out for many reasons. We are not driven by irrational pricing just to create user base. Growth is important but not at the cost of profitability. Then, we have a higher brand loyalty since we are in the business of fulfi lling a basic need. Also, authentic high quality food with better ingredients is provided by us. And, lastly, our on-demand food delivery and pre-planned catering will give us the upper hand in competition.
Please explain the rationale of Internet restaurants these days. What are the chances of them surviving 2-3 years from now? Is it a bubble waiting to pop?
It’s good for a consumer as well as from business perspective because more the players, more will be the cut-throat competition. This in turn leads us to addressing quality and timely service to customers. Also, the best player will win the race and excel by overcoming the difficulties; rest of the players will either try to match the standards or find some other ways. I am seeing it from a positive point of view keeping in mind that e-commerce boom, which is evident in every sector, has also affected the food sector and that offers a lot more to explore in the coming 2-3 years.
Making a brand out of an Internet business looks to be even more difficult than establishing one’s name in the physical F&B landscape. Your views.
Yes, I agree to this point. But with a right set of strategy, research, execution, use of technology, dedicated employees and a loyal customer base, success is possible to achieve in the online food business landscape. Creating database and winning customer confidence is the most important thing and we are working on it by increasing our database though different platforms. For example, marketing, social media campaigns, referrals, etc., are going to help us generate positive visibility. Once the end-consumer engages with us and trusts our products, they would not go anywhere else, as we never compromise on quality over quantity.
While food is central to the success of any restaurant – offline or online – ambience, location, service, format, etc., are also critical for offline restaurant. In your view, what will count as the benchmarks for a successful Internet restaurant?
In the case of Internet restaurant, we don’t need to worry about the ambience, location, décor, format as we are not falling into the typical brick and mortar category, which is a positive point for us. All we need to focus on is providing quality food, better service, timely delivery, menu engineering, technology up-gradation, creating local database, reaching out to more and more customers within the vicinity, etc. We will invest money more on technology, analysis, research to up-grade and fasten-up our service. For example, we are now launching GPS tracking to give our customers a more convenient and hassle-free approach. We are also coming up with a better interface such as account creation and customer loyalty programme, etc.
What is your marketing strategy to mark your digital presence and enhance your online business with both retail and institutional (corporate) customers?
Apart from a world-class product, the marketing has been our key focus area. There are some key marketing strategies we have adopted. Like, welcoming institutional customers through referrals, digital marketing (using all social media platforms, campaigns), targeted and segmented marketing, institutional sales through front line sales and PR exercise.
Which is the target audience you are focussing on, retail customers or corporate clients?
We are looking at both ends. But more of institutional customers because Gurgaon is a hub for MNCs, corporate houses and big companies. Our business is primarily B2C and our primary consumers are SEC A/A+, 20-45 years, working professionals who most likely are well-travelled, understand good food, have high disposable incomes and are discerning in their taste. They are the ones who are always short on time/resources and look forward to having access to great food at their doorstep.
The audience is already an avid e-commerce consumer and regularly eat out/order food at home/office and entertain at home as well. Corporate Admins/HR are also our key customers as they influence decision-making process for the business, which we get from corporate meetings and institutional get-togethers.
What are you doing to successfully integrate both your back-end and front-end operations? Will this help to make the business more efficient and customer-centric?
The back-end is very important and the interface between suppliers (partner kitchens, raw material stores, food manufacturers, growers, processors, etc.) and the in-house sourcing/chef teams becomes critical in maintaining a balance between both of them. We are planning to come up with mobile applications for all back-end operations (kitchen, suppliers) and have launched GPS tracking for better co-ordination between kitchen and delivery team. We have our quality and testing team in place, which try and test all raw materials before using it. We keep a tab on all kitchen operations and have integrated them on a single platform along with other back-end operations. Now, customers can track their orders and help us in locating their addresses and delivering food within the shortest possible time.
What are your plans for integrating order management and analytics?
We have our own integrated platform for order management, which we are doing by crafting our own menu, ordering and delivery on a single platform. We have a team of five-star chefs who understand consumer psychology regarding food, and their experience in the food industry come handy. We have our marketing and data mining teams who strategically target the consumers and analyse their preferences with the marketing team helping through research. We have plans for a standalone team, which will be robust, strong, and strategic in data digging with the help of marketing, design, digital team to create a strong database and will encompass data from every operation (both back-end and front-end).
What do you think of menu engineering techniques today and its importance in luring customers to hit the sweet spots and drive business?
When it comes to menu engineering techniques, we relied on our five-star chefs who have crafted the menu after extensive research on studying consumer mindset, their food preference, etc. We always give preference to the likes and dislikes of our consumers and hence, prepared our menu according to customers’ demands and preference rather than our choice. We are not cuisine specific; we aspire to be a completely consumer-centric brand, which is agnostic to cuisine, location, time and need-state. This is clearly exhibited in the variety and authenticity of our menu, 24×7 on-demand/bulk deliveries across our city catchments and a completely quality controlled process. We are designed as an integrator and not as an aggregator with complete in-house control on ordering, food crafting (including supply chain) and delivery processes.
When we started, we had 1,000 dishes, which we tried and tested by taking orders from customers and then zeroed in on 400 dishes from different cuisines for our a-la-carte menu, which caters to bulk orders for parties, events and big gatherings. We have our Xpress menu in place, which has the most-preferred and top-selling items in any category for instant consumption within the shortest possible time.