Their strategic expansion into offline retail not only revived local economies but also introduced affordable gourmet products to communities craving quality and flavor. With a meticulous approach to product curation and a commitment to customer satisfaction, Bombay Gourmet Market continues to redefine the gourmet retail experience, one neighborhood at a time.

Not many brands in India have charted a course for major franchise success with affordable gourmet retailing as their compass. But Akshay Kumar and Kurush Dadabhoy, Co-founders, Bombay Gourmet Market, a chain of 18 neighborhood gourmet stores located across 6 cities in west and south India — Mumbai, Pune, Goa, Hyderabad, Rajkot and Vadodara — can be called the poster boys for creating a successful model in the business of grocery franchising and gourmet retailing.  

Before Covid struck in 2020, both Akshay and Kurush were surfing the commercial waves in their respective businesses: Akshay had put down roots as a successful restaurateur in Mumbai, operating Bombay Sultaani Biryani House in Borivali and had spent close to 5-6 years in the industry. Kurush, on the other hand, ran a well-oiled enterprise selling and trading in imported electrical switchgear.

Just as their businesses seemed to be smoothly coasting along, the Covid pandemic came baring its fangs and dealt a sucker punch. Akshay’s restaurant gig grinded to a screeching halt and Kurush saw his enterprise skid off the rails.

Rising above restaurant shutdown by pivoting to online grocery

Tossing a lifeline to someone who falls overboard can throw up surprising, often magical results. As Akshay was moping and brooding about his next course of action, he received a phone call from his Zomato and Swiggy contacts at the restaurant. “They informed me that their platforms were expanding into grocery deliveries and suggested that I list my kitchen’s products. At that time, they were operating on a marketplace model and eagerly encouraged me to showcase items like fresh sauces and ready-to-cook meats. Always open to new opportunities, I agreed to give it a try. The results surpassed my expectations many times over, which prompted me to fully embrace online sales through this channel.”

That’s how Bombay Gourmet Market got off the starting blocks in 2020, within the first few days of the imposition of complete lockdown — as on online food and grocery platform. Akshay re-jigged his restaurant space in double quick time, listed and uploaded the details of products lying in the restaurant’s kitchen with Swiggy and Zomato.

“It was my restaurant where I started, because restaurants were shut during Covid, and I just thought of putting the space to some use. I had an asset, which had to be monetized because the lockdown had made revenue zero for the business I was operating in. So, I had to monetize and do something, which was much needed in those times,” recounts Akshay.

He shares that he had about 15 minutes to think of a brand name for his online grocery business and about another ten minutes to upload items that were there in his existing restaurant kitchen. “And as I started uploading the details of products, orders started flowing in. And, you know, that actually kept us quite sane during the lockdown, if I may use that word.”  

But while the pandemic exacerbated the crisis of sustaining business operations across all industries, it also brought in a perfectly teed up opportunity for online food and grocery retailers. For many affected and pandemic-hit business owners, venturing into food and grocery became the ideal test bed for experimentation and a way to keep their business mast flying.

“During the lockdown, offline sectors across various industries, including retail, faced significant challenges. While supermarkets were able to muddle through thanks to the government notifying it as an essential service, restaurants, clothing stores, salons, and many other retail sectors shut down. This had a widespread adverse impact on the retail industry, with offline operations bearing the sting and hardest hit. However, online food and grocery experienced unprecedented gains and traction during this period,” says Akshay.

Large swathes of customers in cities and towns across India, who preferred in-store visits for their grocery shopping turned overnight into the most devoted proselytizers of online shopping. That Bombay Gourmet Market began grabbing eyeballs and instant orders from the moment it listed is proof of the voracious force  9 gale demand from customers clamoring to place orders and get their online orders fulfilled.

For the newly minted Bombay Gourmet Market, not only did its online orders keep swelling up, it also launched 4 other online stores within the next couple of months to cater to different catchments within Mumbai. “The orders just kept adding up without ebbing for once. Honestly, there was no looking back and we just kept refreshing and shuffling our inventory as we moved from one store to five stores online within months. I had never thought that it would magnify into something as large,” says Akshay.

From online success to offline retail

However, by the middle of 2021, the pandemic was receding further in the rear view mirror. After, what seemed like a long-drawn slumber, shops, markets, cinemas and salons roared back into business with a frenzy. Shoppers, tired of being cooped up during the lockdown, sent the markets into overdrive with their vengeance spending. At the same time, the tear-away growth that online grocery had seen of late seemed to have finally found its ceiling.

Bombay Gourmet Market with its five online stores too saw orders dip into a deep trough. The slowdown was further aggravated by the fact that both Swiggy and Zomato, which had earlier acted as the catalytic fuel for the retailer, had now developed their own grocery delivery infrastructures — Swiggy with Instamart and Zomato through the acquisition of Blinkit. “Our order volumes and visibility decreased as a result, which prompted us to venture into offline operations in 2021 in a bid to diversify and stabilize our business,” confides Akshay.

With Swiggy Instamart and Zomato’s Blinkit focused sharply on growing and expanding their own grocery delivery business, it was Akshay’s restaurant business, now resurrected back to life, which offered the quantum of financial solace. But having tasted success in his entrepreneurial gig as an online neighborhood gourmet retailer, Akshay was intent on creating a successful playbook for launching Bombay Gourmet Market as an offline gourmet retail brand.

But as the saying goes: If wishes were horses, beggars would ride. Launching an offline store in a city where real estate value is stratospheric is easier said than done.  Starting down the road of offline grocery retailing in a city like Mumbai is like entering the meat grinder of entrepreneurship. If you come in here with naïve ideals, you’re going to get chewed up and spat out.

Fortunately, Bombay Gourmet Market’s run and stint as an online gourmet player had racked up enough commercial bounty as well as brand recognition for Akshay to launch a 375 sq.ft. store in Mumbai’s Borivali.

As people in the locality were already familiar with the brand with many of them being Akshay’s restaurant and/or his online gourmet store’s customers, the maiden launch of Bombay Gourmet Market’s first offline store received a positive public response. The store, which is now run as a franchise business, enjoys a fervent following in the community, and has emerged as a trusted destination for food aficionados looking for higher-quality ingredients and products with an elevated flavor profile.

Success breeds more success, and the success of a business demonstrates a fitness for future tokens of success and recognition. Within three to four months of inaugurating its initial store, Bombay Gourmet Market launched its second outlet that same year in 2021. “And then I thought that this is the way forward and we will launch the next store in another three to four months,” says Akshay.

The confidence sprang from a deep-seated belief that he would be able to spin the magic wheels in his newly launched offline gourmet retailing business. But spreading the brand’s wings in Mumbai demanded bucketloads if not an avalanche of capital. It was a difficult needle to thread and required hard thinking and working on a separate track. Akshay had to find a path to navigate through the thickets of challenges ahead without breaking the conventional business guardrails.

Money lies at the heart of any business. And, for startups, it means making trips to the funding well. But Akshay did not wish to jump on that treadmill. It was at this point in time that he began seriously thinking about the franchise model as a more enduring channel for growing the supermarket business. As someone originally hailing from the restaurant industry, Akshay knew many potential investors who were keen on taking up a restaurant franchise.

“During meetings and over meals at my restaurant, many investors used to ask why I don’t franchise my restaurant. My response was that restaurant franchising isn’t simple because it heavily relies on manpower. In the restaurant industry, success hinges on both food quality and service. Personally, I lacked the motivation to franchise the restaurant business.”

Continuing on the same riff, Akshay elaborates: “However, in the aftermath of the pandemic, many people grasped this plane of reality that supermarkets are a safer business to be in. “Many of the franchisees Kurush and I engaged with had originally planned to open independent restaurants. However, our conversations revealed that they had been misled by the food franchise companies they had consulted. We brought some of them around to partner with us and become our supermarket franchisees.”

The Akshay-Kurush partnership

Having made the decision to expand the store network through the franchise route, Akshay and his business partner Kurush, prepared to get down to the brass tacks of the business and kick the enterprise up another gear. Their plans to rope in franchisees for the supermarket business had already found quite a few takers.

Akshay and Kurush first met in early 2021 only to discover that their vocation and avocation were happily one. While Akshay was already directly involved in the food business, running a restaurant and his newly founded supermarket business, Kurush too came with retailing antecedents, although in a different product line. But like Akshay, he too harbored a deep love and interest in the food business, which brought him to meet up with Akshay when he came looking to take up a franchise of Bombay Gourmet Market. The two met and immediately bonded, with Akshay making the offer to Kurush to become a master franchise instead.

“When I first got introduced to Bombay Gourmet Market, my initial intention was to open my own store as a franchisee. However, given my background as a trader, Akshay realized I could provide more value as a master franchisee. I took on the role, in which capacity I focused on managing taxation, accounting, inventory, software maintenance, and creating an operational framework, including generating various reports for our business operations. These are areas where I believed my expertise complemented Akshay’s vision.”

Before long, the intensity and gravity of purpose vibrating off of each other brought them closer still. Realizing that they both shared the same enthusiasm for the business, Akshay asked Kurush to come on board as a co-founder. “We shared a psychological alchemy and instantly knew that both us shared an all consuming passion to grow our gourmet retailing supermarket business,” recounts Akshay.      

“Akshay’s vision and contributions are unlike anything I experienced in my previous industry. The platform he provided me with is now something we offer to our franchisees. This initial support from Akshay is what I value most, and that’s how our partnership began. Since then, we have built a strong business relationship and friendship. It has been truly remarkable collaborating with someone like him,” exudes Kurush.

In fact, the two of them are like Siamese twins because if you separate them, you lose some vital parts of each. Both reinforce each other in a virtuous circle as is evident by how they go about performing their roles and responsibilities. Together, they bring a fresh, ferocious energy to the business and, between them, they get the job done fast like a ninja.

Both Akshay and Kurush have divvied up their roles and responsibilities in the business with almost Euclidean precision. Kurush manages the back-end operations, focusing on maintaining the supply chain and overseeing the terms of trade with brands, particularly regarding the addition and removal of products. He and his team are responsible for ensuring smooth operations in these areas. Their role is critical in maintaining efficient inventory management and fostering productive relationships with suppliers and brand partners.

Akshay oversees the front-end operations of the business, focusing on marketing, operational strategies, and store management. Additionally, both Akshay and Kurush are actively engaged in managing the product assortment. This is crucial for shaping the identity of Bombay Gourmet Market, which is positioned as an experiential gourmet retail store.

Redefining neighborhood gourmet retail

Since launching its first physical store in 2021, Bombay Gourmet Market has successfully established itself as a thriving grocery franchising business. The brand has strategically expanded to 18 stores currently, each contributing significantly to its sustainable growth. The store sizes range from 300 sq.ft. for the smallest to 1800 sq.ft. for the largest, with the median size being approximately 500-600 sq.ft.

Currently, Bombay Gourmet Market has 5 stores operating in Mumbai with the rest located in cities such as Pune, Goa, Hyderabad, Rajkot and Vadodara. The stores cater to a diverse audience spanning from Gen Z to Baby Boomers, offering a wide array of products that appeal to varying tastes and preferences. This includes trendy items like ramen noodles as well as organic staples, grocery essentials, snacks such as healthy namkeens, and specialty items like cold-pressed oils.

Though Bombay Gourmet Market operates 5 stores in Mumbai, the brand has strategically shifted focus to Tier II and Tier III cities. “Mumbai’s high costs make offline retail challenging, with rentals under better control in non-metro areas. Despite this, demand matches that of Mumbai, and cities like Rajkot, Goa, Pune, and Hyderabad offer higher returns on investment. While Mumbai boasts higher disposable incomes, we have observed substantial wealth generation in Tier II cities, which is catalyzing strong demand for gourmet products,” notes Akshay.

He adds that there exists a deep well of untapped demand for gourmet products in non-metro cities. This trend will become more sharply defined because the rising demand for gourmet products in Tier II and Tier III cities isn’t being fully met. “When we introduce our stores in these areas, we consistently witness a positive reaction from the local community. Residents express appreciation, eagerly welcoming the availability of gourmet offerings in their neighborhoods. This response underscores the value and satisfaction our presence brings to these underserved markets.”  

By way of an example, he cites the success of Le 15, a brand known for packaged cookies and owned by pastry chef and businesswoman Pooja Dhingra, at his Rajkot store. “Surprisingly, our Rajkot store stands out as one of the top sellers for these cookies, which shows the untapped market potential in these cities. This success highlights the importance of exploring new markets, as opportunities for growth and tapping consumer interest can often exceed our initial expectations.”

But aren’t gourmet stores perceived to be pricey and a shoo-away for the value seeking Indian consumer? “Due to the pandemic-induced lockdown, there has been a notable rise in home chefs experimenting with gourmet ingredients like mascarpone cheese for dishes such as tiramisu. Before the pandemic, these ingredients might have been unfamiliar to many, but today, there is significant demand in cities like Hyderabad, Goa, and Rajkot. The surge in social media usage has also played a crucial role in spreading awareness about such products and their versatile applications. Also, our approach focuses on offering affordable products that are tried and tested, rather than expensive options. This ensures that our offerings cater to the preferences of our customers, providing them with value for their money,” counters Akshay.

In Bombay Gourmet Market’s retail strategy, products priced over Rs. 1,000 are not part of the inventory, which highlights the retailer’s commitment to affordability and value for money. Even when including imported items, they ensure that pricing remains accessible. For instance, they avoid stocking cheeses priced at, say Rs. 4,000 per block because they know that such items would not find traction even in urban centers like Mumbai, let alone Tier II cities.

Instead, their approach to product assortment is both intuitive and calibrated, and aimed at creating an ambiance that is inviting and superlative. The emphasis is on offering essential items alongside experiential products, and to ensure that customers can easily find what they need while also discovering new and unique offerings. This strategy resonates particularly well in Tier II and Tier III cities, where there is significant demand for a wide range of products.

From essentials to exotics

The market positioning of Bombay Gourmet Market as a neighborhood gourmet retailing store reflects a deliberate strategy to cater to discerning consumers seeking high-quality, curated food products in their local community. This strategic focus and positioning not only differentiates Bombay Gourmet Market in the marketplace from traditional supermarkets or specialty stores but also strengthens its connection with the community it serves.

To their credit, both Akshay and Kurush have crafted an experience where quality and variety meets. “We bring the best curation of products for those who have a finer taste in life. The range covers imported as well as premium, top-notch home-grown products in India. We have ensured that each customer gets what they’re looking for, be it daily essentials or exotic,” avers Akshay.

From the freshest fruits and vegetables to artisanal cheeses and gourmet chocolates, every product is chosen to tickle the taste buds and stimulate the gustatory receptors. A highlight of the Bombay Gourmet Market is its own line of gourmet creations — fresh, preservative-free, and crafted in small batches. Whether its pasta & pizza sauces infused with flavors like mint & Greek or tantalizing dips & chutneys, each offering promises a taste sensation. Seasonal delights like chocolate-coated strawberries add a touch of indulgence to every month.

For those with dietary preferences, Bombay Gourmet Market offers a diverse range of vegan options. From oat milk and yoghurt to vegan cheeses and gluten-free treats, there’s something to delight every conscious food lover. The brand’s commitment to freshness extends to Namkeen snacks made in small batches with less oil, appealing to a wider audience seeking healthier choices. Apart from this, they stock the best of daily essentials like milk, butter, cheese, and freshest of breads.

Nostalgia finds a place too, with beloved classics like Phantom cigarettes and Parle poppins alongside modern favorites such as Korean instant noodles and frozen ready-to-eat meals. Sugar-free chocolates and premium exotic tonic waters cater to those with refined tastes, while the selection of single-origin Indian spices and herbs adds depth and richness to every culinary creation.

As Akshay proudly affirms, “From chocolates to cheese, from grocery to gourmet, our shelves are stocked with the best from European, Asian, and American Pantries. Whether you’re seeking the perfect ingredient for a special recipe or simply exploring new flavors, Bombay Gourmet Market promises an unparalleled shopping experience.”

Strategic product assortment and innovative merchandising

Bombay Gourmet Market stores are meticulously organized into categories like Beverages, Gourmet World Foods, Healthy Munchies, Ready-to-Eat/Cook, and many more, making it effortless to find exactly what you’re looking for. “In a store of our scale, ranging mostly from 300 to 600 square feet and having about 4,000 SKUs, we’ve tailored our inventory to ensure precision and conciseness. When you step inside, you’ll find exactly what you’re looking for,” asserts Akshay. Citing an example, he says that if a shopper comes to the store looking for juices, she will find three to four prominent Indian brands and an equal number of imported juice brands on the shelves.

Should any specific item not be readily available, the stores maintain strong customer relationships to promptly address and fulfill requests. Regular feedback from customers further guides their product selection, with a commitment to finding and offering brands or items that customers ask for and like. This customer-centric approach underscores the retailer’s dedication to meeting diverse consumer demands and fostering a positive shopping experience tailored to individual needs.

 When Akshay and Kurush are questioned about how they source the expansive array of products available at their stores, they maintain that their sourcing strategy is a closely guarded trade secret. As seasoned retailers, they emphasize the importance of careful selection and strategic partnerships in building their inventory. Their approach involves extensive market research and direct engagement with suppliers and distributors. By forging strong relationships within the industry, they gain access to a diverse range of products that cater to various consumer preferences and trends.

“Our foremost challenge revolves around determining the optimal product assortment for each store location. This decision-making process poses significant complexity and is central to our operational concerns,” admits Akshay. Given the diverse array of food categories Bombay Gourmet Market stocks — World foods, Asian and European beverages, vegan, gluten-free, and health-oriented options — optimizing space within a 300 sq.ft. smaller store, and a 600 sq.ft. medium-sized store, and ensuring  effective and prominent display of all products can be a daunting challenge.      

 Akshay and Kurush explain that they have been able to overcome the challenge by listening to and earnestly acting on the feedback received from local distributors. They also get insights from the brands and from an AI-based tool they utilize, which helps them to understand customer consumption patterns based on which they make informed decisions.

Using AI tools, Akshay and Kurush analyze whether the market is predominantly vegetarian or non-vegetarian, and whether it caters primarily to the upper-middle-class demographic. Additionally, they assess the dining habits of the local audience and determine the product mix for their stores based on these insights. Both recognize that there is no universal one-size-fits-all formula to assortment and inventory management.

At the same time, Akshay and Kurush prioritize quality and innovation in their product offerings. They conduct rigorous evaluations, including product trials and quality assessments, to ensure that each item meets their standards before it reaches the shelves. Their commitment to customer satisfaction drives them to continuously seek new and exciting additions to their inventory. This proactive approach not only enriches the shopping experience for their clientele but also positions their stores as hubs of discovery and convenience.

“We tailor assortment and inventory to meet the unique demographic needs of each store. Therefore, each store is approached as a distinct entity from its inception. We are currently developing an automated inventory replenishment system that will replenish inventory based on sales patterns, thus streamlining operations and enhancing efficiency across the board,” informs Kurush. This proactive and innovative approach to merchandising and assortment has enabled Bombay Gourmet Market to develop its unique selling proposition centered on providing a seamless shopping experience where customers easily find what they seek upon entering the store.  

As expert retailers, Akshay and Kurush understand that sourcing is not just about acquiring products but about curating an experience. By maintaining their trade secret and staying agile in their sourcing practices, they aim to consistently deliver a unique and compelling assortment that distinguishes their brand in the competitive retail landscape.

“Initially, Akshay and I handle the assortment for our franchisees. But after one month, two months, three months, the store owners themselves begin giving us feedback. They inform us about customer preferences and local brands they want us to stock. We value this ground-level feedback because it helps us understand diverse demographics and buying patterns across the country,” informs Kurush.

Laying on the theme further, he adds: “Every city has its own conditions and consumption patterns shaped by demographics and cultural factors. Understanding these differences is crucial for tailoring our offerings to meet the specific needs of each community.”

Akshay emphasizes that it is important for retailers to recognize and understand the unique needs of each location. “Products that sell in Goa, like impulse items and party products, may not be suitable for Rajkot, where consumer behavior and preferences differ significantly. It’s counterproductive to go by rigid rules like trying to match inventory in Mumbai with that in Rajkot or Goa. We adapt accordingly and are flexible in our approach to building the assortment across our stores.”

To ensure newness and novelty in the product basket, Akshay and Kurush prioritize supporting independent brands, particularly new and health-conscious ventures seeking entry into the retail sector. “We actively engage with these brands, evaluating their products through trial testing and background checks before incorporating them into our offerings,” says Akshay.

Bombay Gourmet Market adheres to stringent terms when introducing new, health-focused brands. The approach includes rigorous sampling to ensure customers experience and appreciate the product before making a purchase decision. This proactive sampling strategy not only enhances customer engagement but also boosts product uptake and ensures that items are well-received rather than left idle on the shelves.

“Our approach is flexible. We do not enforce rigid criteria that could exclude promising new brands. Instead, we seek partnerships with like-minded brands committed to robust business goals and growth within the retail industry. At the heart of our strategy is delivering a personalized customer experience. Introducing new brands enhances this experience as our loyal customers eagerly anticipate discovering fresh additions to our selection,” explains Kurush.

“When customers visit us, many inquire eagerly about our latest offerings, asking ‘naya kya hai?’ This curiosity drives us to continuously surprise and delight them with innovative products. Whether vegan alternatives, sugar-free options, or baked snacks with a focus on health, our goal is to bring these offerings to tier two and tier three cities, thereby promoting Indian brands and enriching community experiences,” adds Kurush.

A playbook for grocery franchising

Following the initial launch of a few self-owned stores, Akshay and Kurush transitioned completely to a franchise model for Bombay Gourmet Market. Today, all stores are operated and owned by franchisees. “We shifted away from company-owned stores due to the substantial backend operations required to ensure seamless service to our franchisees. This includes maintaining a consistent product assortment and continuously improving overall store operations,” says Akshay.

Aksahy and Kurush concluded that maintaining both company-owned stores and franchise operations would lead to potential biases favoring the company-owned outlets due to higher interest. Therefore, they made a conscious decision to exclusively collaborate with franchisees and focus on alleviating the logistical complexities of franchisees in managing supply chains, optimizing assortments, adding new inventory, negotiating margins, and other operational tasks.

Operating as partners with their franchisees, they ensure mutual respect and autonomy in outlet management. This strategic shift allows them ample resources and focus to foster business growth comfortably. “We will reevaluate the possibility of reintroducing company-owned stores once the business expands to a desired scale,” reveals Akshay.

Explaining their process of franchisee selection, Kurush shares that there are some important boxes to check. “When considering potential franchisees, our foremost criterion is their alignment with our operational ethos. We seek partners who share our passion for products and customer relationships. For us, financial capability comes second: What truly matters is their commitment to running the store hands-on.”

For those interested, the initial investment ranges from 50-60 lakh rupees. This includes transparent costs detailed in a layout plan covering structure, tiling, branding, and more. Franchisees are free to manage construction independently or with their own contractors. Additionally, Akshay and Kurush provide franchisees with a list of specified brands and products but allow flexibility in procurement. A nominal franchise fee is also required, along with stocking costs, totaling around 15 lakh rupees for a typical 400-500 sq.ft. store.

“For us, how much money a potential franchise can bring to the table is secondary. It surely is an important issue to address — but it’s just one piece of the pie,” observes Kurush. The most important consideration for Akshay and Kurush is that franchisees must immerse themselves in daily operations. This involvement ensures that franchisees understand the business dynamics and maintain effective relationships with staff and customers. It’s a prerequisite that safeguards against potential disputes and aligns with Bombay Gourmet Market’s franchisee-owned, franchisee-operated model.

“Ultimately, our ideal investor is someone eager to engage directly in the gourmet product market, treating the franchise as their own business. This approach fosters a cohesive partnership where mutual goals of growth and brand success are prioritized,” says Kurush.

Emphasizing their distinctive franchise model, Akshay and Kurush assert that no one else in the industry operates franchises in the same way. Outlining comprehensive details about operational processes, innovations, challenges, and support mechanisms offered to franchisees, they underscore the intricacies of managing the supply chain and how their proactive efforts ensure seamless operations across all franchise locations.

Kurush and his team impart a week-long crash course to the onboarding franchisee in all operational and retailing aspects. The training is rigorous with a level of detail so precise so as to be almost clinical. Lessons in handling merchandising and assortment, inventory management, customer relationship and personalization are all imparted in a way that they become almost tattooed on the back of the hand of the franchise operator.

“Franchising our business model involves more than just branding. We provide a comprehensive supply chain solution. Coordinating with over 500 distributors for our 4,000 SKUs is a massive undertaking but we ensure seamless stock management for each store. To further simplify and streamline operations, we’re working on, as mentioned earlier, developing an AI-powered system that automatically restocks inventory. This new technology demonstrates our commitment to keeping up with market needs and improving our services,” points out Kurush.

Once the franchisee completes the store setup, Kurush and his team conducts a thorough local market analysis. Utilizing a database of 18,000 items, optimal product assortments tailored to customer demand patterns are curated. Following the finalization of product selections, purchase orders are generated directly through the software and streamlining of procurement is done with suppliers via WhatsApp or email.

Akshay and Kurush have established relationships with national and regional distributors, which facilitate swift order processing. Upon receipt of purchase orders, goods are integrated into the system through detailed purchase entries. The inventory is monitored to address any discrepancies and to ensure that stores are fully stocked within 10-15 days.

“By supporting franchisees through every step, we provide comprehensive training on software operations, inventory management, accounting, and compliance. This hands-on approach guarantees operational excellence across all locations. Occasionally, logistical challenges arise, particularly in remote areas where specific gourmet products may be scarce. To mitigate this, we maintain a small warehouse in our main office in Mumbai, which enables direct fulfillment when local distributors fall short,” says Kurush.

This collaborative approach underpins Bombay Gourmet Market’s successful franchising strategy and how Akshay and Kurush’s commitment towards franchisees extends beyond the initial setup. To address any emerging needs, the duo also conducts regular visits and virtual meetings to reinforce operational standards and retailing excellence.

Integrating ERP technology and online solutions

Bombay Gourmet Market has long relied on its ERP software, specifically Gofrugal, which has been integral to their operations since their inception. Despite occasional challenges with the software, they continuously adapt and optimize its use.

Akash and Kurush emphasize that while the software is crucial, understanding its reports and insights is equally vital. Interpreting sales reports, for instance, allows them to discern trends for popular items such as Coca-Cola, Parle-G biscuits, or Italian tomato sauce. This understanding informs strategic decisions to enhance product offerings and sales strategies.

On a monthly or bi-monthly basis, the two adjust product assortments based on sales trends and consumer behavior. This dynamic approach ensures that inventory levels are consistently optimized to meet customer demand effectively.

Recently, Bombay Gourmet Market announced a strategic partnership with Yango Tech, known for its innovative solutions in global technology. Central to this partnership is Yango Tech’s White-Label Store App, an advanced tool designed to elevate the online grocery shopping experience. Powered by sophisticated machine learning, it delivers personalized recommendations for a streamlined user journey. The App’s pre-built design reduces development time and will enable Bombay Gourmet Market to swiftly integrate advanced online grocery services.

This collaboration aligns seamlessly with Bombay Gourmet Market’s strategy to ramp up its online presence and cater more effectively to customer needs. The focus is on optimizing the online app experience to increase customer engagement and convenience. In addition, the partnership will enable Bombay Gourmet Market to white label a wide array of products, spanning from ready-to-eat to ready-to-cook ranges. By white labeling, the retailer aims to imbue each product category with the hallmark of freshness and small-batch craftsmanship, thereby ensuring that every item meets stringent quality standards.

White labeling will also allow Bombay Gourmet Market to leverage its expertise in sourcing and curating premium ingredients, and crafting them into gourmet offerings. This approach not only ensures consistency in taste and quality but also enables the brand to maintain competitive pricing without compromising on excellence.

Yango Tech’s White-Label Store App will allow Bombay Gourmet Market to roll out live order tracking and dynamic pricing based on real-time demand, besides ensuring competitive prices. The App supports flexible payment options including credit cards, debit cards, and e-wallets for added convenience. The App will also allow Bombay Gourmet Market to highlight its unique brand identity with visually appealing product displays and help the retailer to introduce a transforming online grocery experience that combines technological innovation with the richness of gourmet selections.

The road ahead

After 4 years of grocery retailing operations in both online and offline mode, the time has come for Bombay Gourmet Market to press the gas pedal hard and crank up the top gear. The retailer is already rolling the dice by doubling down on its AI-based app and launching new stores under its franchise network. “We are already into developing AI solutions with the aim to enhance the customer experience and provide instant and intuitive interactions rather than traditional search methods. Our goal is to create a seamless, mood-based interface. As we progress towards this vision, our plan includes expanding our store network and launching our own digital app,” says Akshay.

Over the next three years, Akshay and Kurush plan to grow their franchise store count from the current 18 to maybe another 300 odd stores. “For now, we want to stick to west and south India, where we already have a good brand presence. Once we are, you know, another 35-40 outlets strong, we will then start moving northwards and eastwards as well. We plan expanding to cities like Nashik, Indore and Jaipur but that’s going to be over some time,” reveals Akshay, before signing off.

The post How Bombay Gourmet Market is charting franchise success with affordable gourmet retailing appeared first on Business of Food.

It was in 2012 that a certain 27-year-old Azim Mohammad returned to his hometown Cuttack after doing a three-year tour of duty, learning the tricks of the trade while interning with reputed and established grocers across the country. Like a devotee who cuts himself loose from worldly moorings and sets out in the search of true knowledge and enlightenment, Azim had decided to break out of his cocoon, leaving behind his job and other obligations.

Like the proverbial pilgrim’s progress, Azim’s quest to deep dive and plumb the depths of the retail trade saw him intern with some of the well-known meisters and acknowledged mavens of grocery trade in India — Pariwar Supermarket in Jalna, Maharashtra; Dhirajsons Supermarket in Surat, Gujarat;and Sarvodaya Store in Mumbai. Three years after embarking on a self-learning exercise, he came back to launch his own store — Metto Supermarket in Cuttack.

Feeding a passion born early

After completing his MBA, Azim got placed as an Assistant Manager, Commercials, in Reliance Communications. Almost two years into his first job, he got a call from his uncle who was into the real estate and hotel business, a traditional family preserve and stronghold. Members in Azim’s family have been among the oldest operators in this line of business in Odisha.

The uncle was looking to diversify his business and he asked Azim if he had any plans to suggest. “At the time this incident took place, I was reading a book called It Happened in India: The Story of Pantaloons, Big Bazaar, Central and the Great Indian Consumer, written by Kishore Biyani.

It’s the only book to have been penned by India’s greatest retail maverick — one to have achieved the heights of retail success.  The book talks about how Biyani as a businessman refused to fit into the traditional confines of his family business and ended up creating India’s most successful retail chain. It also introduced Azim to some fresh insights and perspectives on India’s retail market and its untapped potential.

“What left a deep imprint on reading this book was how India, upon entering the second decade of the second millennium, with a population of 100 crore plus people had only a tiny, wispy sliver of modern trade at just 3-4% compared with the US where a population of 30 crore had about 60% of its trade in the organized sector.”

”The book struck a chord, stirred up my subconscious, and raised some unbidden thoughts and ambitions, which coalesced with a sharp focus when my uncle asked for my opinion on a new business to diversify.” However, Azim’s opinion did meet his uncle’s confidence; but the nephew had already been sold on the idea of embracing the retail business ever since his MBA days in the college. “The initial inspiration had come when I was on the verge of completing my MBA. A guest faculty member from the US was visiting the institute who happened to be a senior executive at one of America’s most popular department store chain — Target. In his talk to the students, he narrated the evolution and powerful growth of the organized retail industry in the US and how, in comparison, India remained an untapped, virgin market for organized retail trade but one with an unlimited runway to grow and expand in the future.”

“It was a talk that channeled my inner entrepreneurial spirit and certainly got me hooked to the retail industry. Also, whenever I used to visit my home town during the breaks, I would chance upon many new stores like Reliance Fresh that were springing up in various parts of the city. All of it crystallized my interest in the retail industry,” he says.

While he took up a corporate job with Reliance after completing his MBA, Azim’s heart beat to the cadence and rhythms of the retail industry, which he wanted to be his true calling in life. Soon enough, Azim left his first job at Reliance and took up another — this time as a store manager — at a Reliance Fresh store in Krishna Nagar, New Delhi. “After spending about a year in my second job, I was caught up by the urge to start my own venture. My earlier interaction with my uncle had finally helped me to resolve my own feelings about what I wanted to do in life,” says Azim.

It was also a time, when he was in touch with some of the leading lights in grocery retail, including practicing retailers and retail consultants to help him guide forward on his retail journey. “One of them was Chetan Sangoi, a retail consultant who also operates his family-run Sarvodaya Supermarket in Mumbai. When I told him that I had decided to launch my own store, he encouraged me to knuckle down for my new project by acquiring more first-hand experience of the trade. I took this advice to heart and that’s how I set off on the journey to learn, intern and work with some of the established grocery retailers across the country,” shares Azim.

A retail dream takes shape

After an exciting, retail-knowledge fuelled tryst, Azim returned home to Cuttack with plans to open his own store. But he realized that his glimmering dreams would have to wait until the time all the clearances and permits for the new store were in place.

For a newbie entrepreneur impatient to alchemize his dreams into reality, Azim felt like Ahab chasing the white whale of bureaucratic corridors in pursuit of the elusive licenses. Recalling the phase, he says that there was a maelstrom of to-do activities before he could get the store off the ground. It involved time-consuming runarounds to procure different licenses from different departments.

“It took me almost three months running and chasing officials from the different departments to get all the licenses — trade license, food license, shop & establishment license, license for weights and measurements, packing license etc, with the fire license proving to be the biggest ordeal. For any wannabe entrepreneur, getting all the compliance certificates to meet this regulatory burden can be unnerving and very time consuming.”

Offering his take on what’s still a big entrepreneurial hurdle, Azim says that that though most regulations have been framed with good intent to serve the public good, there is much scope for streamlining the system, making the process less cumbersome, easing the compliance burden, and promoting the ease-of-doing business.

“In my opinion, a single-window clearance system for acquiring all the licenses can be the biggest service to the cause of entrepreneurship. Some of these licenses can be subsumed into a single regulation while a few can be done away with. You even have to acquire a license for playing music inside the store. Imagine, it was only a few years ago I learnt that we need to get an insecticides license for selling the common mosquito and bugs’ repellants in the store.”

After some three months of hard-scrabble chase and hunt, the licenses were in the bag. The moment had come when the rubber would finally meet the road. Metto Supermarket was started as a 2,500 sq.ft. store initially with an investment of Rs. 25 lakh. The size of the store was later extended to 4,500 sq.ft. after six months of the launch, and it is today spread across 6,400 sq.ft.

Azim says that the initial investment would have been higher but for the good fortune he had in getting his hands on some brand new electronics at a marked down rate as they were lying unsold at one of the malls that had closed down operations.

The store opened to a good public response with its location proving to be a major winning point. “From the days of my internship with the top retailers, the one thing that struck me loud and clear is that getting the footfalls is the biggest challenge for any new store. That’s why I decided on a location that was on a high street and just about 300-400 metres apart from two up-and-running Reliance Fresh stores. Also, I made sure that the store enjoyed a wide 120-foot frontage, which endowed it with good visibility and easy access,” says Azim.

To those new to the world of retail, it might seem like a counter-intuitive move to open a new-born store next to the maws of sinewy and hungry competitors. But for Azim, it was a deliberate decision with hard-nosed business logic.

“People in the area were already accustomed to buying from Reliance Fresh and were exposed to the modern trade concept. So, I did not have to worry about creating a new market or changing customers’ habits and shopping behavior, which can prove to be a big challenge for any retailer. Also, I did not have to do a market survey or research to understand the market potential of the location because that, in any case, must have been done by Reliance before opening their stores.”

However, despite the upsides, certain challenges came along the way too. “Cuttack is an old and a very retail-dense city dominated by kirana shops every few meters and where people are used to buying from shops on a credit basis. Also, smaller packs are more popular with the shoppers than their bigger units,” says Azim.

It took a few months of intense in-store interaction with the shoppers just to convince them that buying at a modern supermarket is a more pocket-friendly proposition and shoppers can indeed save more on their grocery budget by shopping at Metto than at the scattered kirana shops.

“By and by, through their own experience, people began believing that the store offered the biggest bang for their buck and it was a place for making value purchases. And, of course, they enjoyed the touch and feel experience and the freedom to choose from a wide range and variety of products,” says Iffat Jahan, the better half of Azim, who partners her husband in running the affairs of the supermarket chain.

Store format, USP and performance

Metto  has a portfolio of 5 supermarkets — 4 in Cuttack, and 1 in Bhubaneswar, as of 2022. Of the three stores, the first store at 6, 400 sq.ft. is the largest followed by a 2,800 sq.ft. store,  with the smallest at 850 sq.ft. 

In terms of revenue performance, for the month of July 2022, sales came in at Rs. 65 lakh for the 6,400 sq.ft. store and Rs. 35 lakh for the 2,800 sq.ft. store. “Our sales per sq.ft. Are decent and the sales numbers when broken down show that they are close to Rs. 1500 per sq.ft, which is considered to be a healthy figure,” says Azim.

“Our stores are getting good acceptance from the customers and that gives me the room to play around with new categories and products and experiment with new concepts to increase the sales further,” he adds. At the same time, he is honest to admit that there is plenty of room for Metto’s sales numbers to improve and grow bigger. “My market intelligence says that the two Reliance Fresh stores nearby are scoring higher  numbers which can largely be attributed to their higher marketing budget”.

“Thanks to their bigger marketing budget and a wider range of Fresh products at their stores, they are able to reach out to more customers and penetrate a higher number of households. As the Fresh stores also stock wet grocery and fruits and veggies, they attract greater footfalls as well,” feels Azim.

Azim says that it’s his conscious decision to not stock fruits and veggies because even though they fetch higher footfalls, the ROI on the category is not great. “From my experience as a store manager at Reliance Fresh, I know that the ROI in Fresh is not something to jump about. Also, the category is difficult to maintain because of the perishable nature of the products. Then there are problems around wastage, shrinkage and timely replenishment.”

Metto’s product mix is spread across more than 30 categories ranging from food and grocery to non-food and FMCG, crockery and kitchen ware, plastics and steel, toys and bags, among others. About 70% of the floor space is devoted to the supermarket categories, which includes food and grocery, and FMCG.

With a 70% sales contribution, the focus is more on food and grocery including products like oil and ghee, and masalas, which is also the store’s most profitable category, giving out 30-35% in profit margins. The chain is known for stocking an impressive range and variety of food and grocery products. “You can find four different varieties of jeera at our store, different varieties under individual pulses like tur, chana, moong, masur, etc, and a wide range of staples, cereals, snacks and ready-to-eat/cook products,” says Azim.

As far the customer segments are concerned, Metto stores cater to the masses with the focus more towards the lower and middle income consumers. Metto stores have built their brand identity around offering attractive discounts with a wide range and variety of products to choose from. “I am very much inspired by the D-Mart success story and how they have established their brand identity as a ‘people’s store’. Like D-Mart, Metto’s market positioning is of a discount store,” says Azim.

In keeping with its discount store positioning, Metto is known for its super-size 20% discount on all weekends and a regular 5% discount on all weekdays. For instance, Metto offers a 20% discount on food and grocery items on the 4th weekend of every month. Similarly, on the third weekend of the month, a 20% discount is extended to the category of masalas

On some select items like ghee and milk, which offer very tight margins, not more than a 2% discount is available. “Even when Reliance Fresh was offering a 2% discount back in 2014-15, we were offering 5%. Now that it has become a staple marketing offer, we have a very distinctive 20% discount on all Saturdays and Sundays on select categories on a rotational basis,” he adds.

Iffat, who dons the mantle of Metto’s Executive Director, joined Azim in his venture in 2019 after completing her B.Tech studies from National Institute of Technology, Karnataka. Since then she has been actively engaged in driving Operations, Marketing & Management of Metto. Iffat holds the opinion that a 20% discount on all grocery products is a value bonanza for the households. “There’s a huge rush on those days, which is 5-6 times more than on the regular days, and the stores have to be opened from 6 in the morning to close to midnight. People come in large numbers and buy bigger packs and SKUs to maximize the value of their purchase. Also, as these discounts are on the selling price and not on MRP, there is an even bigger gain for the customer.”

The mega discount offers on the weekends have helped Metto to burnish its image as a super-value store and strengthened its brand identity and visibility as a value retailer for the masses. “It’s now become a part of people’s general consciousness that one can get more value for the money by buying at Metto than at the nearby stores,” says Iffat.

Azim says that Metto is able to offer the super discounts because of its strong relationship with major suppliers. “Seeing the huge demand for their products due to the special offers, they are happy to let go of some of their own margin, which is anyway recompensed in a higher measure thanks to the huge bump in sales. At the same time, as a retailer, we also sacrifice our own profit margin for those special days and pass on the benefits to the consumer, who becomes our regular customer not just on the weekends but on the other days as well.”

Managing the business with lessons learnt from setbacks

Up until now, the growth journey of Metto supermarket has been completely organic. Could the pace of growth have been faster if it had looked beyond its own kitty for funding the expansion? “Rather than lean towards debt, I would take on board an equity partner or an investor who can join our journey of growth, and such a move is very much on the table,” says Azim.

He adds that Metto’s business expansion was pretty fast during the early days but a few things came unstuck that slowed down the momentum. “I had opened my second 4,500 sq.ft store in Bhubaneswar within two years of our first launch. However, the life of the second store was cut short and it folded just after a year of operations,” reveals Azim, noting that the failure set him back by some three years.

How could a gifted entrepreneur with the right credentials by way of educational background (MBA), business lineage (family members in business) and one who went all the way to cultivate and gather extra business moss and retailing nous by working with top retailers in the country go wrong only in his second gambit?

“Basically, I was blindsided by my ambition to move the flywheel too fast and too quickly and the wheels came off before reaching the top gear. Also, I could not handle the challenges of operating two different stores in different cities, and things soon spiraled out of my control to the extent that I had to shut down the store,” says Azim.

But what was the exact nature of those challenges? He confides that he paid a price for paying a rental that the sales could not support apart from not having a mature and seasoned team to trouble-shoot the erumpent problems. “To be honest, in my eagerness to grow and expand, and out of my fascination at the swift growth of the likes of Big Bazaar and Reliance Fresh, I got completely blindsided and tried to juggle my way around the basics that are at the core of retail science. My mentors had taught me that the rentals of any retail business should not exceed 2-3% of the sales generated; salaries should be within the 3-4% limit of the overall turnover; power consumption bills should not max out beyond 1-1.5% of the topline; keeping more than 5-10 suppliers for any category is not advisable.”

Azim admits that he broke the rules of the game and payed dearly for it. “To give an example, I had 40 manufacturers supplying for the biscuit category. It led to an inventory pile-up of unvendible products at the store. Apart from incurring a financial loss of about Rs. 30 lakh, the close down caused a lot of disappointment,” he says.

The setback pushed Azim to go back to the drawing board and review his actions with threadbare honesty. Some of the basic lessons that he had given a short shrift to came back to him with a burning force and incandescent clarity. “I resolved to assemble an efficient team comprising competent professionals and put proper systems and processes in place to oversee the different facets of the business. Also, I decided not to dabble in everything myself because that leads you to having too many irons in the fire and you can end up burning your fingers,” says Azim, adding that he was juggling various tasks from managing the purchasing orders to sales and marketing to presiding over all the meetings and taking various other decisions. “I had made myself indispensible to many parts of the business and it just didn’t work out.”

Today, the Metto chain is run by a smart and experienced team, which comprises Azim as Managing Director, Iffat as Executive Director, and other top managers from different departments as part of the company’s leadership management. There are seven departments, each with its own Head and key result areas (KRAs) to supervise and implement decisions to propel growth in line with the company’s policy and vision

“All departments — Managing Committee, HR, Accounts, R&D, Purchase, Operations, and Sales & Marketing — have their targets and goals to meet by taking a systematic approach and with the necessary systems and processes in place, and these are reviewed on a weekly basis. Since every operation is managed on an app, the managers are able to work toward meeting their KRAs and business goals, and there is clear visibility on execution and results,” informs Azim.

Technology and online prowess

Technology is now the oxygen that retail breathes. For any retailer and supermarket owner, operating without the tools of technology can become a virtual nightmare. “Technology tools and solutions are making life easier for the retailer, employees, and customers. You cannot scale-up your operations and you cannot even carry out your everyday routine functions without technological aid and support,” says Azim.

“Whether it’s billing, stock counting, raising POs, running loyalty programs or ensuring that all your systems are running in sync, one needs to fall back on technology. At the same time, it is imperative that retailers keep upgrading their stack of technology solutions in keeping with the emerging market exigencies and demands. For being up-to-speed with technology, retailers should invest 0.5% of their total annual sales on upgrading their technology solutions and IT systems, adds Azim.

On being asked about Metto’s digital capabilities, Iffat says that the supermarket chain has its own mobile app and its own web page for taking online orders. About 5-6% of all our orders come through this channel, which shows that online is yet to become an important part of our sales. For food and grocery, people still prefer visiting the stores and they like to touch and feel the product before deciding on a purchase.”

However, during the pandemic and the days of lockdown, Metto saw a sharp spike in online orders, to the tune of 60-70% of overall store sales. During the complete lockdown phase, it even crossed 90% , she reveals. Azim says that all the products and catalogues at Metto stores can be seen on the app and the web page, and a third-part service provider has been tasked with ensuring that the user interface is easy and smooth.

The road map to future

Turning his thoughts to the profit potential of the grocery business, Azim feels that that it depends on the person and how he is able to handle the business. “Today, in my ow neighborhood, I see lots of new supermarkets opening up, some of them by people who were not into any business earlier but have been professionals working for different industries. Clearly,

there must be something that is bringing them to dip their feet in this business. But whether they are able to run a profitable enterprise will depend on how faithfully and sincerely they adhere to the basic tenets of this business and play the game by the rule book. If you stick to the math and work by the numbers, profits are bound to come by and they will grow as you scale and multiply your business.

Once bitten, twice shy might be a cliché but for Azim the rules of retail are like the Rosetta stone he keeps going back to for shepherding his business. By acting on the basics of retail science and keeping those lessons at the heart of the business playbook, Azim now feels confident to move to newer chapters that will define Metto’s growth journey in the future.

“With all the structures, systems, and processes in place, it has now become very easy for us to move to next orbit of growth and scale-up the business fast. Once a location for a new store gets finalized, our team gets on into the action, taking up their specific functions and executing those as per the deadline. The reporting structure is such that it’s easy for me to spot any deviance and issues and fix them before they blow up,” explains Azim.

“Thanks to technology, and the way it has helped put in place systemic structures along all vital parts of our business, we no longer apprehend the problems associated earlier in operating stores across different cities and distant places. The need to have a physical personal presence to manage spatially distant stores has been taken care of by technology and stores can be managed as well remotely without physical proximity,” opines Iffat.

For the next couple of years at least, Metto’s growth and expansion would be centred around the cities of Cuttack and Bhubaneswar. “We want to grow in clusters and not in a scatter-shot way, so that we have an upperhand on the control,” says Iffat.

Azim adds that he expects his two new stores to rack up combined sales of Rs. 1.5 crore on a monthly basis for the first year of operations. ‘‘With future prospects looking promising, the company has already attracting investor attention and interest. Metto has already taken on board a private equity partner willing to finance and invest in building the company to 10 times its current size, signs off Azim.

This article was published in September Edition of Progressive Grocer 2022. To read more articles, subscribe to the magazine.

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