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Starting with a 200 sq ft cafe in Mangalore, this bakester now makes Rs 1 Cr revenue every year (Start up stories)

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Mariam Mohuideen’s Baker’s Treat is now a 19-member, 2,200 square feet, 90-seater restaurant on Mother Teresa Road, Mangalore. It sees a daily footfall of around 150 customers.

Mangalore (Mangaluru), the gateway of Karnataka, is famous for its unique brand of coastal cuisine. Seafood dishes, kori rotineer dosa, Mangalore buns, and Mangalore bajjis are some of the city’s must-try foods.

While these traditional dishes remain popular, there is a large segment of customers with rapidly changing tastes -the millennials.

Heavily influenced by Western cuisines, millennials are creating big demand for burgers, pastas, pizzas, and cakes. When 48-year-old Mariam Mohuideen observed this trend in Mangalore, she felt it was the right time to tap into her baking skills to start her own business.

Mariam (right) with Giriraj Singh (centre), former Union Minister of State, MSME, and Ram Mohan Mishra (left), AS and DC, MSME

“I moved back to my hometown Mangalore from Dubai after working there in administration for several years. When I saw there wasn’t much opportunity for me here, I decided to leverage my baking skills to start a cafe,” she says.

In December 2014, she started Baker’s Treat -a bakery that sold home-baked goods. “It was a small, 200 square feet space from where we made and sold baked goods,” Mariam tells SMBStory.

She adds, “Things took off beautifully and everything fell in the right place at the right time, and in three years, we were on the verge of becoming a full-fledged cafe.”

In 2017, Mariam invested almost Rs 20 lakh and turned Baker’s Treat into a restaurant for cakes, cupcakes, burgers, pastas, and shakes aimed at Mangalore’s evolving taste buds. It was funded in part by her savings and through family investment.

Baker's Treat
Baker’s Treat cafe, Mangalore

The Baker’s Treat approach

Today, Mariam’s business is a 19-member, 2,200 square feet, 90-seater restaurant on Mother Teresa Road, Mangalore. It sees a daily footfall of around 150 customers, who mostly flock to Mariam’s Oreo nutella cheesecakes, brownies, and cupcakes.

“Our Oreo Nutella cheesecake, Oreo fudge brownie and range of cupcakes are the most popular foods. The restaurant is always full,” she beams.

Baker's Treat
Cupcakes from Baker’s Treat cafe

With a healthy flow of customers, Baker’s Treat clocked a Rs 1 crore turnover last year.

“I have taken in women who were unemployed and unskilled, and they are part of my team. I taught them the craft of baking, and some of them have become independent earners in their family,” Mariam says.

To achieve a product-market fit, Baker’s Treat employs a combination of word-of-mouth and digital marketing. However, Mariam’s approach is unique because she doesn’t do much active promotions herself, apart from posting updates and pictures on social media pages for Baker’s Treat.

“Social media platforms have helped in attracting the youth of Mangalore, who post their experiences online. This, in turn, attracts more people,” she says, adding, “Apart from this, word-of-mouth is powerful for us. The food as well as the trendy, appealing interiors and comforting ambience of Baker’s Treat has always been a crowd puller.”

Since Baker’s Treat inception, Mariam has won recognition from the local community. In 2019, Baker’s Treat was awarded the YourStory Brands of India award for Best Micro Enterprise in the Restaurant category. Further, Mariam won a Yenfame women entrepreneur award in the same year. In 2017, Baker’s Treat had also bagged the Power Business Excellence ‘best startup’ award.

The self-taught baker

With Mariam at the helm, Baker’s Treat has reached an almost cult-like status in the Mangalore market. Mariam claims that apart from customers from upbeat localities, there are regular orders placed from different towns near the city.

“There are days when people from abroad, like from the US and Dubai, show up with orders for their favourite cakes. I feel this is because we have stayed with the changing trends and come up with unique ideas, such as customised cakes,” she says.

Baker's Treat
A custom-made chocolate cake from Baker’s Treat

The customised cakes, which Baker’s Treat makes for all sorts of occasions, are a big hit among customers, she adds.

“The cakes cost around Rs 1,000 per kg, but what sets them apart is the degree of customisation we offer. We go completely by what the customer wants, and execute the same,” she says.

A self-taught baker, Mariam has also conducted cooking classes for over 600 people since 2013. She says she has also conducted free classes, in association with NGOs, and given away sales profits to charity.

“The honesty and justice done to any food produced from the Baker’s Treat kitchen has gained the business a lot of credibility. That itself is a big impact on customers and society,” she says.

Being a self-taught baker, Mariam has always faced questions and criticisms regarding her qualifications to be a baker. She believes people don’t often applaud each other for their self-made achievements.

“People demand certificates to decide the credibility and qualification of an individual. But I feel my growth as an entrepreneur disregards the existing paradigms. However, there continue to be challenges such as growing in the market and scaling the labour force,” she says.

What next?

Mariam feels Mangalore is generally not used to new things, despite millennials. For her, scaling up to reach more customers feel like a risk, and she prefers taking it slow.

“At the moment, I don’t want to do too many things. Outsiders to Mangalore have taken to Baker’s Treat faster, so I don’t wish to expand right away,” she says.

Expansion is still on the cards, at a later stage albeit, and Mariam is targeting the nearby town of Manipal. For her, venturing into a metro like Bengaluru is not a priority.

Baker's Treat
Baker’s Treat is currently a 90-seater cafe

“Having Baker’s Treat cafes in multiple cities is a far away dream. I am currently focussing on the operations here. We have to keep investing in new equipment and varieties of food. I am happy with this for now,” she says.

Her business mantra is to take one thing at a time, be organised, and perform well. “Accept the challenges, as everyday is new. Be open to the daily experiences and consider them as lessons for life,” she says.

Inspiration stories

These techies quit their IT jobs to start a milkshake brand Shakos in Chennai, made Rs 1 Cr revenue in a year (Start up stories)

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With this range of food products and pricing model, Shakos recorded Rs 1 crore revenue just over a year after launch, and is targeting Rs 5 crore by the end of this year.

Chennai’s tropical climate makes it a great market for businesses selling cool drinks, juices, and milkshakes. As the weather is quite hot for several months in a year, these businesses can run profitably for most of the year.

An IMARC group report showed that the Indian milkshake market is expected to grow at a CAGR of 25 percent during 2019-2024, driven by numerous factors such as a large young population, changing lifestyles, convenience, value addition, health consciousness, etc.

And this big swell in demand for milkshakes is something that the young founders of Chennai brand Shakos experienced for themselves.

Shakos founders Ram Dinesh, Kishore Thennarasu and Tamizh Selvan

Started as Fryos in 2017, Ram Dinesh (25), Kishore Thennarasu (25) and Tamizh Selvan (25)were serving different varieties of french fries from a small kiosk.

The IT professionals also had milkshakes as part of the menu, but the shakes became such a huge hit that the founders decided to start Shakos and serve milkshakes exclusively.

How it was set up

Ram Dinesh says:

“Before we started Shakos, we saw milkshakes in Chennai were overpriced, or their quality did not justify the price point. We saw this as a big opportunity for milkshakes which balanced good quality with affordable prices.”

The trio also saw a deficit in Quick Service Restaurant (QSR) brands representing Chennai globally. “We wanted to contribute our part towards shaping the Chennai food market which had just started booming. After extensive research for about six months, we were able to come up with the recipe for milkshakes as well as a plan for operations,” Dinesh says.

The founders were from different IT verticals such as sales and marketing, growth, operations, etc, but this business opportunity seemed too good to turn down.

They quit their jobs and came together to start Shakos with a bootstrapped investment of Rs 45 lakh.

“We also introduced affordable waffles just one month after launching. This helped retain customers,” he explains.

Shakos
Shakos milkshakes come in bottles, similar to Keventers

Recipe for success

Shakos’ milkshakes and waffles became a big hit soon after launch. In two months, it granted franchises to two outlets in Nungambakkam and Besant Nagar in Chennai.

“All the three outlets have a 4.5+ ratings on Zomato (rated by over 650+ customers) and LBB, and comes under the hand-picked list by Zomato. All the joints are open until 2 AM,” he says.

Similar to Keventers, Shakos sells milkshakes in bottles that customers can take home.

Shakos’ classic shakes come in vanilla, mango, coffee, butterscotch, chocolate chip, and more. They are priced between Rs 160 (for the small size) and Rs 200 (for the large size).

The brand also has premium milkshakes in a range of unique flavours such as nutella, Kit Kat, tiramisu, coffee hazelnut, banana popcorn, and many more. They are priced between Rs 180 (for the small size) and Rs 210 (for the large size).

Momos (Rs 99) and loaded fries (Rs 129) are also part of the menu.

With this range of food products and pricing model, Shakos recorded Rs 1 crore revenue just over a year after launch, and is targeting Rs 5 crore by the end of this year.

Shakos
Shakos currently has three outlets in Chennai

Growth strategy

The founders aim to open 50 outlets this year and 200 outlets in the next two years. Dinesh adds that potential partnerships for master franchises in Bengaluru, Coimbatore and Mumbai are in the works.

But it will not be easy competing against big milkshake brands -a challenge faced by the founders since Shakos started.

“The established milkshake brands have larger investments, and the market is saturated with lots of milkshake brands. So far, we were able to sail through this because of our simple operations, taste and value for money,” Dinesh explains.

He adds that Shakos is also looking at a cloud kitchen model across various cities. “The roadmap for pan-India expansion looks positive and cloud kitchens can be done with minimal investments,” he says.

Shakos wants to stay bootstrapped for the time being. “We’re not looking to dilute the stakes. Our customers are our biggest investors,” Dinesh says.

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100 outlets and Rs 40 Cr revenue in 2 years: Frozen Bottle’s milkshake revolution (Start up stories)

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Bootstrapped with Rs 36 lakh, Frozen Bottle has quickly become a sought-after milkshake brand. Next up for the frozen dessert brand: adding 140 more stores to the current 100, which were opened in less than two years.

 

When Pranshul Yadav and Arun Suvarna met through common friends three years ago they did not realise that they would team up for an entrepreneurial journey. Pranshul, 33, was running his own quick-service restaurant (QSR) business when he met Arun, 45, who was in real estate. In 2017, they decided to start up with Frozen Bottle, a milkshake and frozen desserts brand based in Bengaluru.

In 2016, brands like Keventers were already capturing the imagination of the Indian consumer, who wanted milkshakes at affordable price points. Around the same time, food delivery and commerce services like Swiggy and Zomato were just becoming mainstream services.

Both Arun and Pranshul spent eight months researching the subject, and came to realise that young India still aspired for global choices, but in ways that made it more affordable and readily available. Simply put, as far as the frozen desserts segment in QSR is concerned, Indians looked for both quality and pricing whipped together in one offering.

Pranshul and Arun

Shaking things up

“We combined our experiences and decided that we need to sort the ingredients side of the business, so we tied up with an ice cream vendor to ensure quality and consistency. Now all we had to do was get the branding right,” says Pranshul Yadav, Co-founder of Frozen Bottle.

The founders bootstrapped Frozen Bottle with Rs 36 lakh and started off with a clever campaign, called “Shake the Original”, in 2017, it began with two 210 sq ft stores in Koramangala. Now the brand has 40 company-owned stores with 60 franchise outlets.

“We never expected it to be this big in two years, especially because I was in the business of real estate and never knew how the public would react to this business,” says Arun. His real estate experience did come in handy, as Arun’s understanding helped them sign on small spaces at locations frequented by youth.

Pranshul, on the other hand, already had experience in frozen desserts. He was a franchisee for Cream Stone, and had opened several outlets in Bengaluru, contributing to making it a leading ice cream brand in the city.

The quick rise

Armed with relevant knowledge and experience, the founders were able to open 10 Frozen Bottle stores quickly in the first year in Bengaluru. By the end of 2017, they began to offer franchising.The franchisee invests Rs 18 lakh per store and pays a royalty of eight percent for monthly sales. The franchisee manages the salaries and rentals along with other costs.

The company today generates Rs 40 crore in revenue. Frozen Bottle is in 18 cities—including Bengaluru, Mumbai, Chennai, Delhi, Pune, Surat, Manipal, Kochi, Coimbatore, etc—and 55 percent of its revenue comes from Swiggy deliveries.

“It is a great way to do business. It enables you to reach a large number of consumers and it gave us scale,” says Pranshul.

Walk-ins at outlets are courted with spaces designed keeping the young population in mind. The brand offers a variety of frozen desserts, from thick shakes to cake jars, some with an Indian twist like ‘Banana Gulkand’, and staples like ‘Red Velvet’ and ‘White Chocolate Fantasy’. All shakes are vegetarian, and served in glass bottles and jars that can be reused.

The company plans to open 140 more stores across the country and has set its sights on doubling the number of cities that it operates in. It has so far spent Rs 5 crore for its expansion and believes that the franchise model is the way to scale up.

 

 

Milking the market

The QSR business is close to $1.6 billion in India, according to Analytical Research Cognizance. But is a difficult segment to start up in the F&B space, with most brands not lasting more than a decade, at best. Few Indian brands have scaled up beyond their headquarters with great success. The Helion Ventures-funded Spring Leaf Retail, which ran QSR chain Mast Kalandar, shut down its outlets.

Strong brands like Nirula’s in Delhi and Truffles and Leon Grill in Bengaluru still pander to local tastes and culture of cities, and have become institutions of sorts. But there is investor interest in the space, with restaurants like Mainland China being funded by SAIF Partners in 2008, and Barbecue Nation raising Rs 90 crore from Rakesh Jhunjhunwala last year. It had earlier raised Rs 110 crore from CX Partners.

Frozen Bottle competes with the likes of Keventers, whose business has crossed Rs 100 crore in revenues. “Consumption is going to rise in India and consumers want to experience desserts on the go. Frozen Bottle has been able to scale up on that demand,” says Arun.

The founders want to evolve the brand beyond frozen desserts to a QSR service offering food at its outlets over the next five years. For now, they want to take its milkshakes across India and focus on many more store openings.

Despite homegrown brands such as Shakos, monQo, and Drunken Monkey milking the market, there is room for growth for Frozen Bottle, as is seen in the brand’s quick and steady rise.

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