This Entrepreneur Became The King Of Good Times Just by a Hobby
A quick look at Jay's profile would tell you that he's no novice to the F&B business.
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Partnering with a brand is one thing and living it up to its name is another. As Hard Rock Café, the "Mecca' of music enthusiasts celebrates 10 years in India, Entrepreneur spoke to Jay Singh, Founder and Joint Managing Director, JSM Corporation, to know what it takes to build a successful business partnership.
A quick look at Jay's profile would tell you that he's no novice to the F&B business. Before partnering with Sanjay Mahtani, in 2004, to set up JSM, Sanjay has been associated with various restaurants for almost 15 years. However, none of those were as successful as Hard Rock Café. Jay got into the F&B business for all the wrong reasons. He had some surplus money and thought this business would be fun so he got into it. He admits, "The first restaurant I started was as a hobby."
Two to Tango
Jay met Sanjay Mahtani in 1996, where he almost gate crashed a party which was hosted by Mahtani. The two soon got connected. "When the India opportunity became available for Hard Rock Café, I teamed up with Sanjay Mahtani for this business," informs Singh. Talking about their areas of focus, Jay laughingly says, "In one word, I can say that we start from one place and end at the other." Sanjay mainly looks after the foods, beverages, customer service and the marketing side, informs Jay on a serious note.
Since design is the major focus in all the restaurants owned by JSM, both of them continuously work with a bunch of designers and architects to keep the look trendy. Both have a keen sense of design and can turn something drab into fab. The first Hard Rock Café was started out of an old mill in Bombay. Sharing more such examples, Jay is quick to add, "We have turned a Bengaluru book store, which was almost falling down, into a restaurant. Pune Hard Rock was an old and absolute disappear; we took over and it did well."
However, there are bigger challenges to be addressed. As per Singh, the biggest challenge in India is getting liquor license and because of this they had to shut down the café in Chennai. Currently, that outlet is being converted into another brand the company owns, Shiro. Under JSM umbrella they have opened 24 restaurants so far. Closing this year with revenues of 200 crore, the company cashes in 40 per cent of revenues from Hard Rock Café, while the rest of the brands contribute the remaining. With 1,400 employees, they have raised just one round of funding from Premji Invest.
Talking about its expansion and journey, Jay says, "The journey till now has been very interesting and fantastic, a lot of change has occurred in these years in the F&B industry and the society also evolved. There are few brands that are actually doing well and fortunately we are among one of them." In India, Hard Rock café is widely spread with seven outlets in different parts and one in Nigeria.
Looking at the slow and steady growth of Hard Rock Café, next year they are planning to open two more outlets in India to maintain growth chart with one outlet a year. "We prefer to have one café in each city but in Mumbai we have two and this rate of growth is good for a café like Hard Rock. We have just started in Kolkata and identifying properties in Chandigarh," states Singh.
Food trends for Year 2017
Looking at the position of Hard Rock in the market, it will focus on healthier options which will include vegetarian foods. During the festive season, they introduced vegetarian menus for two months and it was marketed by the name "Be Edgy Go veggie'. "We will focus more on food festivals and healthy food habits in the coming year," informs Singh.
Successful Rules of a Business Partnership
Apart from Hard Rock Café, JSM has got franchise right for California Pizza Kitchen and also for Panda Express, which it is going to launch next year and also has an in-house brand Shiro. Talking about keeping balance between franchise brands and in-house brands he says, "I don't think there is a conscious balance or strategy we are following. Going forward we have our hands full in terms of overall number of brands and in terms of franchises as well."
"Panda Express is something which we are thinking of is likely to evolve in substantial business and we don't think we are going to look for other franchise or company owned business in near future. We may go for other countries like Srilanka and Nepal to expand Hard Rock Café, depending upon the opportunities available," he adds.
According to Jay, franchising is like any other relationship, based on trust and realizing strength and weaknesses of your partner. When you work with a company for 10 years you know everything about it. "When I started this business, I knew nothing and today I have fair knowledge in this. My requirement for a franchisor has changed and we share a solid equation with each other, which is built on strong fundamental trust and now it is more collaborative than it was 10 years ago. There was a time when we opened Hard Rock café and each of us literally used to calculate and write food cost and worked hard to run the business because we did not know. We were very fortunate because we had great people with us with good understanding and partners, who held hand for several years and today it is a kind of a relation in which we share a lot of ideas," concludes Singh.
(This article was first published in the December issue of Entrepreneur Magazine. To subscribe, click here)