Showing posts with label highway. Show all posts
Showing posts with label highway. Show all posts

02 January, 2020

Highway Retailing – Retail 2020 (Article #6)

I have just completed a 10-day vacation across North India. Being an avid traveler, my travel plans are usually frozen at least 2 months in advance, which includes booking of rooms, air / rail transportation as well as ground transportation including the last mile to the Hotel or Resort where we would stay. However. one thing which has always been unplanned, or rather difficult to plan is the place to eat / take a break during such trips, especially while travelling by road. On our last leg today, we drove from Jaipur to Delhi, a distance of 270 Kms which took us around 4.5 hours non-stop. Due to intense Fog in this part of India, we wanted to reach as close as possible to Gurgaon before we took a break. Thanks to constant protests across country on some pretext (currently the NRC) or the other, we decided we wouldn’t stop midway and filled our “tanks” at Jaipur during breakfast. Sadly, the weather played spoil sport and my flight was delayed by over 2.5 hours, thanks to the Fog.


To give a perspective, there are an estimated 40,000+ Fuel Stations across India. Of these, at least 90% of them are branded by PSUs including Indian Oil Corporation which has close to 40% of the outlets, followed by Bharath Petroleum, around 30% and Hindustan Petroleum, around 25%. Lastly, there are the privately-owned OMCs - Oil Marketing Companies such as Reliance, Shell and Essar which are less than 5% in number and growing faster than the PSU OMCs. During my stint at Café Coffee Day in 2009, I signed up two exclusive contracts with Shell and Essar which were riding high on the deregulation of fuel prices which meant that the OMCs could fix the price for Petrol and Diesel. Although they have maintained their prices on par with the PSUs, there are benefits they cater to the consumers beyond filling high quality fuel. For Ex., all Shell Outlets have clean rest rooms separately for Men and Women. Some of them even provide services such as Vehicle Wash and minor repairs. The erstwhile Reliance Fuel Outlets had separate Food Courts from the Fuel Station including independent ingress & egress which was extensively put to use by the company through company managed as well as Franchised / outsourced F&B operations in the name and style of A1 Plazas. 

However, the majority of Fuel stations managed by the Dealers of the 3 PSUs do not even have basic amenities such as clean rest rooms which has been a regular qualm of most highway warriors like me. There are exceptions such as the Yamuna Express highway which connects Delhi to Agra with an Eight-lane highway which has three Toll Plazas and each of them have a neighbouring resting area including large food courts housing International and regional F&B outlets. 


Café Coffee Day remains the Number One F&B brand in India which has the most number of highway Outlets as compared to any other business house in organised F&B Retail. But this trend at CCD started many years back, beginning with the coveted Bangalore – Mysore State Highway followed by many such Highways across India. Many other regional brands such as Haldirams in North India, Sukh Sagar in the West and A2B (Adyar Ananda Bhavan) and Adigas in the South have cracked the regional markets but none at a large pan-India scale. Perhaps, Indian businesses can take a leaf out of International operators in the US & Europe who have built Billion Dollar businesses around this model. 

Personal driving as well as Cab hailing for long distances have become affordable now, thanks to lower cost of owning 4-wheelers as well as many tourist locations across India. Highway Retailing is in it’s infancy in India now and much more needs to be done in times to come. 

27 November, 2018

Coming soon - 60,000 Retail Centres in India…

The Central Government announced on Sunday that it is planning to issue application forms for 60,000 Fuel stations across the Country to be operated through Dealers using the trade name of the Three Oil Marketing Companies (OMCs) Indian Oil, Bharat Petroleum and Hindustan Petroleum. There are already 62,000 (and counting) fuel stations across India which retail Petrol, Diesel and allied products while a bunch of them also retail CNG for commercial vehicles. About 10% of these stations are operated by private players such as Shell, Essar, etc. It is a remarkable feat that the world’s highest fuel retail station is in India at the Ladakh region of Jammu & Kashmir in the Himalayas which is a favourite among auto-enthusiasts. 



As in the past, prospective applicants need to apply online and pay an Ernest deposit to the OMCs which would be followed by a lucky draw. And those who win would be awarded the contracts and assistance provided by the respective agencies in setting up the outlets while those who didn’t qualify would be refunded their deposits. While this generous move by the BJP Government is seen as a positive measure since no such new contracts have been issued in the past four years, critics have dubbed this as a meaningless move with spiralling fuel costs and dwindling vehicle sales over the past two quarters this financial year and a mere public-pleasing stunt ahead of the upcoming National Elections in May 2019. So, the verdict is split. 

It costs a whopping Rs. 1.5 – Rs. 2 Crore to set up a Fuel Station spread over 5,000 sq. ft in the name and style of the OMCs while the cost is more than double for private players like Shell who have stricter norms towards the setting up of the outlets. The biggest challenge for setting up a Fuel Station has been land acquisition, especially on National & State Highways which have seen a 10-fold increase in vehicle traffic over the past decade, thanks to better roads, lower cost of acquiring personal vehicles and a generally heightened mood for vacations and road trips. 


Being an avid traveller and a terrific lover of road trips myself, starting with my beloved Hyundai Santro in 2005 till the new age Mahindra XUV500 (I upgraded to an Automatic from the previous Manual this March), I have personally seen how the entire ecosystem has evolved over the past 15 years or so. In fact, I plan my trips now, whether short or long depending on the wayside amenities that I could use, from rest rooms to coffee shops, meals to speciality snacks and of course the need for service centres, local vehicle mechanics and Authorised Service Centres, etc. The need for such pitstops vary when I travel solo or with family and of course based on the number of hours we travel at a stretch. 

My pet peeve on highway travel has been the lack of good quality toilets (well, good is a relative term, so!) and clean and hygienic food outlets which have somewhat been fulfilled at least across Tamil Nadu Highways which I frequent the most by road. While only a handful International and National Retailers such as Café Coffee Day, KFC, Mc Donalds and A2B have scratched the surface of the opportunity of Highway Travel Retail, there seems to be an enormous opportunity that lays ahead of us. I see these upcoming 60,000 new Fuel stations (many say only 1/3rd of all locations proposed actually turn up in reality) as nothing other than Retail Centres, where apart from filling Fuel, one can have various other retail offering from food outlets like cafes to speciality restaurants, shops selling snacks, fruits and condiments for the journey ahead and of course, wayside motels for a quick overnight stay for tired drivers and their families. 


Reliance Retail with their Fuel stations did come up with some of these models way back in 2006-07 but the whole effort slowly dwindled due to decentralisation of Fuel prices and today, they remain large parcels of land ready for an explosive growth. These fuel stations (and Retail Centres) could be beneficial not only for travellers but also for the nearby towns and villages, generating sustainable employment and entrepreneurial opportunities. 
I am writing this sitting in the back seat of a Bolero travelling on work and just stopped at a highway shack where I had a glass of Coffee. I see a new Retail Centre coming up closely (when I close my eyes).

26 December, 2017

Highway Dining & Holiday rush!


I was among the lakhs of people who left our homes last Saturday as the long Christmas weekend and Christmas holidays began. Reports from all over the country in major cities mentioned long traffic snarls at the Toll booths located just outside the city. At Chengelpet Toll booth which is about 70 kms from where I live in Chennai, the queue of vehicles was for almost a kilometer with over 300 vehicles standing to pass through. We managed to cross in about 20 mins but that was just the start. For the next 100 kms all the way up to Villupuram, I was driving at an average speed of 70 kmph. Perhaps the slowest I have ever driven on this highway that I traverse once a month, at least.


Almost every notable restaurant on the way was filled to the brim with vehicles and people who were piling up like there was some major catastrophe coming up in Chennai. Almost all of us, like really, thought leaving before 6 am would help. Alas. Just that too many of us thought the same thing and ended up crowding toll booths, roads and restaurants. When I finally managed to stop at 9am for breakfast, there were about 70 vehicles and at least 200 people in the restaurant where we ended up. We were informed 30 mins waiting time to get a table. So, I preferred to walk up to the adjacent restaurant which is self-service, hoping things would be faster. When I finished breakfast with family, it took us almost the same time as it would have at the other restaurant. Murphy’s Law. We left after an hour plus break and drove for 3 hours and ended up at India’s top Restaurant Chain for South Indian food and glee, things were not better. This place was even more crowded than we had anticipated. Table service again and it took almost an hour plus for us to finish the grub and leave.


I asked Murugan (name changed), a waiter at the restaurant whether they expected such large turnouts and he replied in the negative. Yelling customers were a norm at most of these places who perhaps didn’t realise that some of the staff haven’t even had their breakfast, forget their lunch. As a Retail guy for 20 years, I truly empathized for the staff but I could do nothing more than wait patiently. Kamala (name changed) was frying fresh Vadas at the restaurant where we had breakfast in the morning and she said she’s been at it since 5.30am. Felt bad for the thankless staff members who ensured we, the customers got out food on time, fresh and tasty.

What could have been done differently was a bit of planning. Here’s my short list;

  • ·      Make a simpler, lighter menu. Keep just the basics available so customers don’t have to think too hard to order, and at the same time, the kitchen staff are quick to prepare the stuff ready. Items like Idli and Vada, French Fies, Samosas and so on must be prepared almost continuously so it acts as a filler when patrons order
  • ·      Add more temporary tables and chairs, plastic ones or metal or whatever. Most customers wouldn’t really care the quality of your furniture when their main motive is to rush out of the restaurants
  • ·      At one restaurant where they profess self-service, I saw that the staff were adding accompaniments like chutney and sambhar to each plate along with the main dish. I suggest this could just be done away with. Focus on the main dish and leave the add-ons to the guests. Keep the chutney and sambhar on the tables and let the customers take as much as they want. Yes, there would be a bit of wastage but we all save time together. Also, avoid four varieties of chutneys, no one just cares, just one would do. Ensure you give less choice to guests but what just matters.
  • ·      Hire local boys and girls temporarily to clean the tables & toilets faster. Use good quality cleaning liquids so the tables don’t stink for the next guest. Toilets must be spic and span. Efficiency and speed are the key.
  • ·      Restaurants with larger spaces and staff can perhaps have someone to usher or a sort of token system or tables assigned against request. This would ensure guests don’t pile up at each table and keep staring at those dining, instead wait patiently till their table is ready.
  • ·      Kids – the biggest challenge to be addressed. Keep them engaged. Have a magician or a story teller or folk art. Nothing free to be offered but something to keep them engaged. Have some crayons and paint books at bay, so the kids can keep coloring and be a bit more engaged. Tried and tested is a large Tv screen with cartoon channels. Be sure the kids would be glued in. But ensure there is no remote around, so there is no flipping of channels and fighting amongst young ones.
  • ·      Men – keep them engaged as well. Set-up boys who can wash the windscreens and bumpers. A good driver always likes his Car clean. Well, almost. A tie-up with local shops to sell additives, car cleaning fluids etc. will ensure the boys and men spend more time there than waiting impatiently at the tables.
  • ·      Ensure your staff are taken care well. Meet each one of them personally and ask if they had breakfast, coffee or tea, lunch, snacks and dinner. And their medicines, if any for some may be diabetic or have other ailments. Show empathy, they need it now more than ever. They are, after all your Brand Ambassadors. Shower them love and they will pass it on to the Guests. Ignore them and that’s what the customers will get as well.
  • ·      At the end of the weekend, if your cash registers ring more than usual, send them home with small gestures such as gift packs of sweets. Make them feel proud that your guys achieved ever-highest sales during this weekend and motivate them. Remember, most people don’t work just for money, they need recognition.


These are some very simple hacks but can go a long way in Guest satisfaction. Holidays are always about memories and we as Retailers, especially the F&B guys make a dent on the memories that guests carry. If there is a delay more than usual time, people fret. But when you throw in something extra, customers mostly remember only that “extra” whether it is “extra happiness” or “extra irritation”. With increasing mobility these days, people are travelling more than ever and they will continue to remember what you offered.


Once again during the upcoming New Year weekend, the restaurants and highways are going to get full. I really hope some changes are undertaken by Restaurant owners small and big to ensure better handling of customers and of course, their own staff. Happy New Year! 

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