India hospitality review July 2012

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INTERVIEW: INDUSTRY

Had I not re-invented the brand, Moti Mahal would have become a thing of the past than a legacy to the future
29 Jun 2012 By Anu Bararia 0 Comments
Monish Gujral is the custodian of Moti Mahal brand, and Managing Director of the Moti Mahal Delux Management Services, an international chain of restaurants and franchises across India and the world. With an illustrious 88 -year old history, Moti Mahal justly claims to be the representative face of North Indian cuisine across continents. The credit goes to Gujral who anchored the trailblazing turn-around of the brand, from a small but iconic presence in Delhi to a multi-national corporation well on its way to defining how the world eats Indian food.

In an exclusive interview to India Hospitality Review, Monish Gujral explains how remaining true to the signature dishes that made Moti Mahal a legend, he reinvented the old dining experience into one that is exciting and avant garde to suit modern sensibilities. With an aim to double the number of his restaurants over the next five years by diversifying into different segments of the food market, he is all geared up to be the Indian answer to some of the major foreign QSR brands operating in India.

Take us through the journey of Moti Mahal.

Moti Mahal started its journey from undivided India in 1920s. My grandfather, Kundan Lal Gujral, introduced the culinary art of tandoori chicken to Peshawar (undivided Punjab) through a small eatery to earn a living after the death of my great grandfather. Fortune struck and his delicacies turned into a grand success. They were in huge demand at social gatherings and wedding feasts where he would put up an improvised tandoor. However, in 1947, partition happened and everything fell apart. He had to flee Peshawar and land in Delhi. At that time, he was out of money and means to start afresh. He roamed street to street in search of a livelihood.

One day, he chanced upon an abandoned Thara in Daryaganj and decided upon reincarnating his tandoori Magic for Dilliwalas, like he did in Peshawar. Thus was born The Moti Mahal. Very soon, Its matchless signature recipes and smoky Frontier flavours made it a name synonymous with authentic North Indian cuisine. The restaurant acquired a landmark status with illustrious visitors – Heads of State, foreign dignitaries and Hollywood stars placing it high on their itineraries when visiting the Capital. Among the high-profile visitors were Pandit Nehru, Indira Gandhi, former President Zakir Hussain, former American President Nixon and Shah of Iran. The former Education Minister of India, Maulana Azad once said, “Coming to Delhi without eating at Moti Mahal would be like visiting Agra without seeing Taj Mahal.”

The onset of 1970s brought massive demand for our restaurant. We decided to expand our network across to the Southern part of the city. Today Moti Mahal is a pan India brand and has transcended domestic boundaries as well to spread the tastes and aromas of its authentic tandoori delicacies.

Was Moti Mahal going out of people’s mind?

No, we were always in the minds of people. Whenever they thought about tandoori chicken or kebabs, we came to mind. Everybody in India has either heard of or eaten once at Moti Mahal in his life. I would agree that at some point the demand was dwindling and had to be escalated. It had to be channelized into the right direction. Anyway, one cannot survive without adapting to the changing market needs. We had to reinvent and diversify our brand to survive. With that happening, we are still hot in business!

You completely did away with the old business model of Moti Mahal…

Yes. Studying in US, I had closely observed their food industry. Majority of the restaurants in US were QSR or Ready-to-Eat formats unlike in India where it was mainly fine dining at five star hotels or unhygienic roadside dhabas. I wanted to lay a similar competitive and scalable model back home. That time around, Moti Mahal was not as well organized or commercial as it is today. A lot of standardization and systematization was required to sync it with the global trends.

Being futuristic, I decided to expand the business into various formats, including the existing fine dining, like food court models, kiosks, resto bars, lounges, and so on. We also entered Ready-To-Eat to cater to our customers not getting time to come to our restaurants or preferred meals on the go. We captured all possible segments to build our brand equity and market base.

This had all begun post 2003 when I instituted the Moti Mahal Delux Management Services (now a private limited company) with the objective of expanding the business into franchises across India. In the next 7 years, Moti Mahal grew from four stand-alone restaurants to 100 company-owned restaurants and 88 franchises in 22 cities of India, and others offshore in the Middle East, Canada, South East Asia, China, Europe and United States.

Today we have over 120 outlets pan India and couple of more outside that are operating through our Master Franchise. In India, we are opening at least two restaurants a month and aim is to double the number over the next five years with various sub-brands and food formats.

We have also started providing hotel Food & Beverages management and consultancy services for three and four star hotels and have begun operations in Punjab, Rajasthan and Gurgaon.

Would your grandfather have agreed to your business model?

[Laughs]

No. He would have preferred to keep the business strictly family-held because in their times that was the popular model. The maximum they could have gone for would have been partnering with somebody. Franchise was an alien concept to them and even if explained well would seem nothing less than alien intervention and compromise with the quality. When I took over the business, I first had to change this mindset and sync our brand to the newer trends. I was, thus, a bridge between the old and new generation.

I started the first franchise in Faridabad in 2004 and went ahead with a mix of franchised and owned models. I also standardized and systematized the operations and procedures and made the brand more professional.

Do you think, had you stuck to the family-held model, Moti Mahal would have been the success it is today?

No. Never. With the old model we were lagging way behind the global standards. We were out of sync with the changing market demographics. I could see that the new generation did not connect with our brand and old one cannot sail it through. Had I not re-invented the brand, Moti Mahal would have become a thing of the past rather than a legacy to the future.

Elaborate on your food court model.

We have created sub-brands under Moti Mahal like China Trail, Tandoori Trail, Kebab Trail, Desi Chat Trail and Dosa Trail. These are all quick service formats. So, while Moti Mahal is the fine dining umbrella brand, these are its specialty offshoots offering different Indian cuisines at nominal rates. Their kiosks are extremely suitable for multi-cuisines food courts in malls in Tier 1 and 2 markets. In smaller cities, they operate as proper QSRs because fine-dining has not fully emerged on the canvas.

Your penchant with the word ‘trail’….?

‘Trail’ signifies the journey of Moti Mahal from Peshawar to Delhi, from a traditional rustic concept to a more assorted, modern one. It is a sufficing linker for all our products that denotes their relation with the parent brand and with each other. This also says that though we are progressive in approach, we remain deeply rooted to our history.

Your first book – The Moti Mahal Tandoori Trail – chronicled this journey?

Yes. And the second one unwraps our adventure in Butter Chicken. Third will be on the Kebab Trail – The Kingdoms of Kebabs.

What would be the expansion ratio of your fine dining formats to the kiosks?

It would be 80:20. However, the kiosk format depends solely on the requirement of mall developers, which brand they wish to have in their food court. In Punjab, we are filling the entire food court with all our eight brands. On an average, out of our goal of opening two outlets a month, one may or may not be a kiosk.

Do you worry about the competition from foreign brands?

If your product is good and is well packaged and promoted, it will sell and gain popularity in the market irrespective of the competition.

Do you at any time consider your brand as an Indian alternative to foreign QSRs?

Oh yes, absolutely! We offer a range of popular western models and formats. We are probably one of the most competitive Indian brands doing such contemporary concepts from a very long time when the market was very nascent.

You say your franchise model is unique. How?

Yes, it is. The hallmark of Moti Mahal ethos is its uncompromising standard of quality and consistency. It is the first food franchise in the world where all Chefs and F&B staff of every franchisee unit are trained by the Mother Company. A contingent of back-up chefs is retained at the Headquarters at all times to ensure uninterrupted consistency. Standardized mother recipes are common to all outlets, as are procurement processes of ingredients and supplies.

Did the retail market boom help you?

Yes. It started happening around 1995-97 and Malls started coming around 1998. They were in search of brands for their food courts while we were in search of platforms to expand and popularize ourselves. It was an opportune time for mutual benefit.

[Laughs]

What Investment goes in for setting up a Moti Mahal fine dining restaurant with bar?

In a mall it costs around Rs 1500 – Rs 1600 per square feet plus Rs 15 lakhs for kitchen equipment, utensils, uniforms, etc. In stand-alone, it is Rs 2000 – Rs 2200 per square feet plus the Rs 15 lakhs.

What are your growth expectations this fiscal?

It should be around 8 per cent for the restaurants and 15 per cent for management and consultancy services.

How has the market instability affected your growth pace now?

Not much. We are running much in advance in terms of our business strategy. We have different revenue options. Our smart brand segmentation in terms of product and pricing has helped us a lot and growth pace has been on the upswing only. Besides, being a franchise-driven brand now, we are cushioned against any major financial downslide. Whatever pressure we might face, would emerge only next year as we expand our Ready-to-Eat model.

How are your foreign outlets contributing to your business?

They are contributing around 10-15 per cent at the moment. It will increase further when all our properties become functional.

Do you plan to do a hotel of your own?

We are open to the idea, but as of now we are focussing more on providing our own F&B services wherein we are setting up hotel kitchens, working up the menus and sourcing kitchen equipments including crockery and cutlery. Soon we would offer services for hotel rooms and architecture wherein we would build hotels and speck at them as per their star categorization. We have the whole set up to do that. Very soon we might as well set up our own hotel ‘trail’.

What are the immediate thrust areas for you?

Popularizing Indian Food

First would be to mainstream Indian cuisine not only in India but abroad also, just like Chinese or Italian. It is a relentless effort to see that day when people in India or abroad would say, “let us have a chicken tikka or rumali roti naan at Moti Mahal,” instead of a Burger at a multi-national fast-food QSR chain. I want to popularise the ‘authentic’ Indian food, Indian style and earn name and fame for it. Therefore I am focussing a lot on doing food promotions, writing books and columns, doing TV shows, road shows, seminars and workshops.

Expanding Ready-to-Eat

Second is to expand Moti Mahal Ready-to-Eat outlets. We have five of them, as of now. We plan to launch three more by next fiscal.

Augmenting Sub-brands

Third thrust area is to launch newer sub-brands and augment existing ones. We plan to do Mexican Trail sometime soon and more depending upon market demands.

Strengthening Hotel F&B Services

Last but not the least would be strengthening our Hotel F&B management service.

What are the challenges operating in India and abroad?

India is said to be an emerging superpower but is still very poor in terms of the infrastructure. In metros also only a handful pockets seem developed, rest are horrendous. Bijli, Paani, Sadak (Power, water, roads) are still daunting issues. Real estate prices are sky high that your ROIs shrink to nothingness. Rentals which should ideally be not more than 10-12 per cent, constitute 20-30 per cent of your total costs. What you earn at the end of the month is Peanuts!

Abroad, things are much clearer, smoother and rewarding. Government and infrastructure are very supportive. Competition is thus intense and it is survival of the fittest. A sab chalta hai (anything works) attitude does not work there. You have to be absolutely over-the-board with your offering and service standards to stay afloat. And if you can survive there, you will survive anywhere.

What is your take on the Indian government?

Very frankly, our country lacks the infra structure required for rapid growth and the authorities have not be able to see the necessity for this. In this 21st century also we have shortage of clean water and electricity which should have been least of our worries. Their single window clearance system hardly works; bureaucratic hurdles and project delays are rampant; there is lot of hue and cry over liquor licences and it takes ages to get permits and licence despite the exorbitant amounts of fees we pay. Then Take the FSSAI, it asks you to maintain your produce at this temperature in the refrigerator but power outages render your refrigerators useless. You use generators and further escalate your costs over what you already pay in electricity bills! This is a Catch-22 situation! With peanuts left in hand, where is the scope for experimentation, innovation and expansion? Few players like us may survive. Majority would not. The growth of the industry would remain snail-paced.

What misconception about Indian food and service standards did you observe in foreign countries?

Till late, Indian food was grossly misrepresented and degraded in the western world. It was all about mom and pop shops being run by husband and wife or small-town runaways. Their restaurants would flaunt gaudy names like Maharaja; fashion a shoddy decor and serve basic Indian cuisines – too oily and spicy. Their restaurants had a strong peculiar smell; staff would be minimalistic and unprofessional; there was no use or have sense of technology and changing market tastes. In short, nothing too remarkable or appealing about them! Ninety per cent of the Indian restaurants abroad were like that. This stereotyped Indian food and restaurants creating a perception much similar to that of Mumbai in Slumdog Millionaire.

This negative image did not let Indian food become a mainstream food like Chinese.

However, the scenario is gradually improving with Chefs and restaurateurs trying to elevate the standard of the industry, popularising true and respectable spirit of Indian cuisine and bringing industry in line with the global trends. The secret is doing local and presenting global. Proper packaging and promotion is the key. Once that happens, our naans and stuffed rotis would become an alternative to pizzas.

How do you go about ingredients sourcing abroad?

We export all our spices from India. Everything else – meats to vegetables – is available outside in better quality.

Places on your immediate radar?

We are heading South. We recently opened a restaurant in Chennai. We are now looking at Cochin, Hyderabad and Bangalore where we already have two.

You do a lot of promotion through the internet and social media…

Yes. Today internet is more prominent and powerful than print. It is highly cost effective and result-oriented.

Your third book, The Kingdoms of Kebabs, is due next year….

Yes. It will be released coming January. While most books talk about Indian kebabs, this book would have kebab recipes from all over the globe; from Turkey, Lebanon, Hawaii, Thailand and where not. It would be a first of its kind.

Soon after, we would release the Foodie’s Trail. It would be more like a Foodie’s diary chronicling my globe-trotting experience meeting some of best chefs of the world, their cooking style and recipes. This one would be based more on the journey than recipes. Would be an absolute fun read!

First chef from India to be invited to Le cordon Bleu to demonstrate in Paris. Monish is credited with the trailblazing turn-around of Moti Mahal, from being a small but iconic presence in Delhi, to becoming a multi-national corporation that is well on its way to defining how the world eats Indian food. A traditionalist, Monish has remained true to the signature dishes that made Moti Mahal a legend, while reinventing the dining experience into one that is exciting and avant garde to suit modern sensibilities.

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