Rebel Foods, which runs brands like Faasos and Behrouz Biryani, is in the process of expanding its kitchen network and experimenting with newer offerings. Kallol Banerjee, in a conversation with Devika Singh, talks about investing in food start-ups, collaborating with established brands and expanding in international markets.
Which are the most profitable brands under Rebel Foods? What’s the kind of revenue each one generates?
Our biggest brands today, in terms of the number of orders, are Faasos and Behrouz Biryani. Both of these individually bring in about Rs 16-17 crore worth of business per month. These two along with our Indian-Chinese brand Mandarin Oak and pizza brand Oven Story have a 70% share in our revenue. We also have other brands like Lunch Box, The Good Bowl and dessert brand Sweet Truth. We have a total of 10 brands right now, but they are in different stages of testing, available at a few locations only. For instance, The 500 Calorie Project, our health food brand, is being tested in Mumbai. We will scale it up when we find the right product-market fit. The perk of a cloud kitchen business is that since most of the demand is online, we can test as many concepts as we want without any risk.
How do you decide on the locations for the cloud kitchens? Do you plan to add more going ahead?
In the last year, we have added 120 kitchens and currently, we have 300 cloud kitchens across 35 cities in the country. We plan to expand our kitchen network to about 550 in the next two years. When we started, we would set up kitchens with very low investments - at times, as low as Rs 7 lakh - but this has gone up over time because we need more equipment, more storage space, etc. We now spend around Rs 75-80 lakh in setting up a kitchen.
There are a few things that help us decide the locations of our kitchens. One is looking at where food aggregators such as Swiggy and Zomato see more traction. They share such locations with us and we set up our kitchens there. Secondly, delivery-focussed businesses like Domino's are also a bellwether for us. We look for areas where Domino’s is doing well, since that indicates a good delivery catchment.
Will you be foraying into newer categories?
Yes, but we don't think we need to do everything ourselves. Take, for instance, our collaboration with Dropkaffe Food and Beverages. Essentially, we have provided them backend support in our kitchens, as we would for our brands. We are also looking at a similar collaboration with American fast food chain Wendy's. It is present only in Delhi currently, but using our network it can expand quickly across the country. We are also looking for a similar tie-up with a fried chicken brand. The idea is that there are people who have built brands that have good customer recall, and they can use our platform to scale up. We usually pick up a stake in these brands, but are open to other engagement models too.
How have you fared internationally? How different are these markets vis-à-vis India?
We have three operational kitchens in Dubai, running brands such as Behrouz Biryani, Oven Story, Faasos, MO, The Biryani Life and Sawa. In Indonesia, we have 16 operational kitchens out of which we operate brands like Box and Co, Nasi Ayam Ambyar, Feeling Brew, Burger Bros and Faasos. We are already seeing around 1,000 orders a day per kitchen in these countries. The average order value in Dubai is four times that of India.
There are plans to scale up in these countries. In Indonesia, we plan to set up 200 kitchens in the next two years, and 100 kitchens in the Middle East. We are also going to be operational in the UK soon, but our business model is slightly different there. We are experimenting with providing backend support and taking care of existing chains in the country.
The palate in these countries is different, so we need to customise our food. Faasos wraps in Dubai, for example, taste quite different from those in India and Indonesia. Another challenge is to ensure that our company's DNA remains the same across these countries.