The India Food Forum 2019, which was held on February 5 & 6 at Hotel Renaissance in Mumbai concluded on the broad thought that restaurant chains and shopping malls will have to collaborate through revenue sharing to ensure that both survive in achieving their coveted objectives.
On the concluding day of the 2-day forum, a cross-section of owners of restaurant chains and mall developers sat together to address the issue of vacant Food & Beverages spaces in several malls across the country, which are a grave concern to the food retail industry. If the cost of real estate in malls for F&B are as high as 22-25 percent, then it is difficult for a lot of chains to survive, restaurant owners stated.
Anurag Katiar of deGustibus Hospitality, Priyank Sukhija of First Fiddle Restaurants, Rahul Singh of Beer Café, Riyaaz Amlani of Impresario Entertainment Hospitality from the restaurant chain and Nirzar Jain of Nexus Malls, P, Pankaj Renjhen of Virtuous Retail, Shibhuankaj Renjhen of Virtuous Retail, Shibu Philips of Lulu Mall and Yogeshwar Sharma of Citywalk from among the developers end participated in the discussion. Samir Kuckreja, founder and CEO, Tasanaya Hospitality and Anuj Kejriwal, CEO & MD, Anarock Retail moderated the discussion.
Much like anchor tenants that attract footfalls at malls, food too has become a key attraction for mall visitors. According to the panelists, customers walk into a mall at 5 pm – they walk around a lot buying stuff, burning calories and building up an appetite. They then walk into restaurants to eat, making a strong case for F&B chains getting direct benefits from anchor tenants.
Despite this, restaurant chain owners believe that restaurant designs in malls need to be updated keeping the everyday nitty-gritties of running eateries in mind. Aside from this, restaurant businesses do not get any input credit on GST paid which adds to its running costs, while the developer enjoys input credit.
“Absence of input credit for restaurant has seen the pay-back period in terms of return on investment has gone up to over 5 years. GST is now a passed through on everything from equipment, food and any cost involved,” said an owner of a restaurant chain.
But there was honorable exception too. Barbeque Nation has opened outlets back and beyond and food has been the hero to their success leading to cooperation from developers to offer them get the best deal. But on a broader front, Cafés and value dining are likely to score over casual and fine dining as the increasing choice of millennials.
