Organised tea retail chain Chai Point, which recently entered the instant chai category, aims to grow the category into Rs 10 crore business in the next one year. It also plans to grow the Consumer Packaged Goods (CPG) category by including food options that go well with tea.
“Over the last 2 years, we have consciously worked towards launching snacks and foods under the CPG category,” Chai Point Co-founder and CEO Amuleek Singh Bijral tells the NFAPost.
Paranthas and Chai combo is loved across the country. During the pandemic, we noticed that especially for evening orders, Chai and light snacks were the most ordered items from our menu, he adds.
“Peppy was the first of many from our stable as we have had a great response from our customers too. The Peppy range, which comprises rolls, loaded paranthas and curries contributes 10% to the Store Revenues within a couple of months of the launch,” he says.
Mountain Trail Foods operates Chai Point, which has always been a tech enabled omni channel brand. While businesses have been hit badly by the second wave of the coronavirus, Amuleek Singh says most of the F&B brands, which didn’t establish a formidable online presence, have suffered the most.
For Chai Point, the impact was high on the store front. However, the delivery business has grown better than expected, he says.
“Currently, the delivery business is 125% of pre-Covid levels. In the last 6 months, we went back to re-examine our overall operations and supply chain to manage the impact of the pandemic. In September/October last year, we launched Shop.Chaipoint.com as our D2C platform where we sell all our CPG products like the Premium Assam Masala Tea and have also listed our newly launched Instant Chai,” he informs.
For Bengaluru-based Chai Point, Digital transformation is now sweeping all levels of business operations from store, delivery, customer loyalty programmes to supply chain and warehousing.
“We have worked on rolling out a group and store level digitally connected programme where most of the processes will be automated, IOT enabled and leverage AI to serve our customers better and at the same time, keep our employees safe,” he says.
As part of the overall strategy, Chai Point has aggressively worked to ramp up its food portfolio. Its mission is now to be present in the kitchen cabinets of its customers and be available to them at an arm’s length in addition to all the digital touch points.
“For F&B brands, the main lesson has been harnessing the power of omni channel business model. As a brand, you can no longer be an online only or offline dominating brand. The Omni Channel strategy has to be the main lever and we believe pure omni channel brands will emerge stronger once the pandemic is behind us,” Chai Point CEO says.
The right mix
Chai Point believes that at the strategy level, it has cracked the right mix of food and chai. Currently, food is contributing around 45% of its overall revenues.
“We believe the impact is going to last for another 3 months and August onwards, we will see green shoots appearing as vaccinations progress and the peak begins to come down. In this tough time, we have done our ground work. We opened 11 new stores last year and going forward, will look for high street store spaces as compared to malls,” Amuleek Singh says.
On the products front, its newly launched brands are getting positive feedback, specially the paranthas and curry range. Going forward, it will also roll out new digital initiatives to engage deeply with its customers.
Chai Point has also created unique and healthy drinks for its customers to boost their immunity.
While Chai Point stores are currently present in metros and tier 1 cities, with the launch of its D2C platform, the retail chain has been able to reach customers pan-India.
Before COVID, Chai Point’s revenues were in the range of Rs 200 crore. “In January 2020, we turned profitable. However, as Corona stuck, like everyone else, our revenues have also taken a hit. As we get ready for a Corona-free world, our focus is entirely on becoming profitable,” concludes Amuleek Singh.
