Hopeful of more guests, dine-out chains set festive table

Large dine-out chains in India are hoping for a pickup in footfalls in the October-December festive season after two back-to-back quarters of sluggish sales.

Demand in this segment was negatively impacted over the last six months as sweltering heat followed by heavy rains kept people mostly indoors, adding to the overall slowdown in the sector.

Industry executives said they are hoping for a 25- 30% jump in sales in the festive season months of October to December compared with a year ago.


“We are hopeful of recovery in demand in the October-December quarter after six months, when macro events such as the severe heatwave and then rains, which disrupted traffic, forced a lot of consumers to stay indoors and impacted the industry,” said Rohit Aggarwal, director at Lite Bite Foods Group, which operates Street Foods by Punjab Grill, Tres and YouMee. Executives at some of these dine-out chains said they are revamping outdoor dining or collaborating with bartenders and chefs for menu changes, while others said they are tying up with credit card companies to push promotions. “Our promotions will be around menu changes, and we’re looking at collaborating with top chefs and bartenders to run food festivals,” said Zorawar Kalra, founder of Massive Restaurants, which runs restaurant brands such as Farzi Cafe, Bo Tai and Papaya. He said the chain expects a 20-30% increase over last year's numbers in November and December. Rahul Singh, the founder of beer pub chain The Beer Café, said he will run an ‘Oktobeerfest’ next month at his outlets and a ‘Free Flow Fest’ at Bira Taprooms. Singh is also head of the pubs vertical of craft beer brand Bira91. Meanwhile, Asian cuisine chain Kylin has sent out mailers promoting outdoor ‘Sufi Saturdays’ at its outlets, which it said is on account of “the season changing to breezier times”.

According to executives, hyper-local competition and food inflation are two key factors for the slowdown in the dining sector.

A report by BNP Paribas India last month noted that consumers are moving away from dine-in, while delivery numbers are getting fragmented. “Sales growth is being led by delivery, while dine-in sales are under pressure. We think this trend is likely to continue,” Kunal Vora, head - India equity research, BNP Paribas, said in the report, which focused on the quick service restaurant (QSR) sector.

Ravi Jaipuria, chairman of RJ Corp, whose group company Devyani International operates KFC and Pizza Hut in India, said in an earnings call last month that the company was “optimistic that the industry will rebound during the ensuing festive season”.

“Consumer sentiment in the first quarter of the year has remained more or less in line with the trends observed for the consumer industry. This has been mainly on account of the challenging macro and microeconomic factors,” Jaipuria said on the call.

To lure back consumers, dine-out platforms such as EazyDiner and Swiggy have started offering up to 50% discount.

“Based on the trends we've observed over the last eight months, we anticipate that numbers could easily exceed last year's October to December figures by 50%,” said Kapil Chopra, founder and chairman of the board at discovery and table reservation platform EazyDiner.

He said the company’s ‘EatOut Festival’ is offering a guaranteed 50% off at some of the most premium restaurants and bars, besides additional discounts on more than 300 credit card variants. “The EatOut Festival runs for nearly two months--from September to the end of October--giving October a very strong start," he said.

Meanwhile, Swiggy Dineout has rolled out a campaign featuring India cricket captain Rohit Sharma to coincide with the onset of the peak festive quarter. “As the festive season approaches, we know our customers are eager to celebrate,” said Swapnil Bajpai, head at Swiggy Dineout, in a statement.