‘It’s viable for brands to have delivery platforms of their own’

As India walks out of months of lockdown, the food and beverage industry which suffered the hardest jolt is crawling back to normalcy. As restaurants struggle to regain consumer confidence and mitigate ways to overcome the challenge, the question remains: has contactless dining the new normal in the post COVID world? Sameer Bhasin, CEO of Nando’s India discusses the future of the food & beverage industry, new CSR initiative and much more.

With no signs of Covid19 subsiding anytime soon and people’s reluctance to eat from outside knowing that hygiene is more critical than it has ever been, when do you expect the restaurants to bounce back to normalcy?

We have entered into a new normal, there is no going back, and we are excited about that. Although the situation has brought with it many challenges, it has also brought with it as much opportunity, and as a brand, we have had to evolve. We firmly believe we are and will continue to come out of this a stronger, better, and more resilient brand. Going forward, a brand’s success will be dependent on how well they adapt to the new normal.

There were massive supply chain disruptions after the sudden announcement of lockdown, how did Nando’s tackle it? 

At Nando’s, we import quite a few Proprietary products of ours from South Africa to keep our secret recipes intact. Import and decently appropriate inventory levels with high shelf life secured our business from any stock out situations during this phase of uncertainty. In addition, since we are a global company, we had visibility of the situation that was happening across the world. We used that as a learning and managed our inventories fairly quickly.

We obviously had to be very agile and deal with the situation in a way that any gaps between business requirements and suppliers were managed. With challenges around some suppliers being in Containment zones, others with restrictions of labor attendance, limited logistic movements surely had put pressure on us but we have been building up on Inventories gradually of all local products. We work very closely with our suppliers, so while there were disruptions and plant shutdowns at their level, but we have been able to deliver an uncompromised customer experience by planning with precision. We have also used this lockdown to initiate local production for a few of our products (packaging) to support PM Modi’s 'Atmanirbhar Bharat' campaign. Given the focus on Delivery and Takeaway business now, this initiative is really going to take us a long way.

Being a part of a global brand family has its perks – and that includes a global view of the situation, the ability to work closely together & share best practice, and of course with advances in technology, a global footprint becomes much smaller and even advantageous. It also means we can spread the risk of supply by leveraging international supply capabilities. Building stocks of local supplies gradually throughout this time has also been key to being able to continue serving a full menu and avoiding any supply chain disruptions. We have also worked very closely with our colleagues in South Africa from where we procure a number of proprietary products to ensure continuity of supply. We have also used this opportunity to initiate local production and sourcing for a few of our packaging items. We believe in the cause of the 'Atmanirbhar Bharat' campaign and this is one example of how we would like to play our part. And, given the importance of delivery and takeaway as a service channel now, the benefits should be far-reaching.

With rentals accounting for a major chunk of expenses for the food chains, what was your cost-cutting strategy to ensure the smooth running of the branches? 

Rent has always been a significant contributor to expenses, and the challenge this presents has obviously been exacerbated under the situation with Coronavirus. But, we have always believed that we need to build meaningful and mutually beneficial relationships with and view our suppliers as partners, rather than the former. We are grateful for the rental support that has been offered to us by our partners. Because rent has for a long time, and probably will continue to be for a long time, a significant contributor to operating costs, we have been quite innovative over the last years at finding efficiencies elsewhere in our operation to help manage costs. We’d love to tell you more, but that would be like giving our PERi-PERi recipe away. Lastly, Nando’s is not just about the chicken (although that’s a pretty compelling motivation), it’s about the unique Nando’s experience, so looking for cost efficiencies will never come at the expense of the world-famous chicken or the Nando’s experience.

Delivery does not really account for a portion of profitability for food chains. However, going forward, will delivery play an increasingly larger role in your business?

Globally, delivery as a service channel has been growing exponentially year-on-year and is probably the only service channel to do so, so aggressively. We had identified the opportunity it presents prior to the arrival of the pandemic. And, we realize that delivery is only going to continue to grow. Our plans to grow this channel further were fast-tracked with the arrival of the Corona Virus and a rapid change in consumer demand. Fast forward a few short months later and we now have our own e-commerce platform and self-delivery service.

Cloud Kitchens have now become the most viable option; how do you see the future of the same? 

We are an innovative brand, and although we aren’t considering this as an opportunity right now, that doesn’t mean we won’t in the future.

Nando’s is popular for self-serving the drinks and beverages, how have you remodeled the same to ensure hygiene? What are some of the strategies Nando’s adopted to regain customer confidence? 

We refer to our restaurants as Casas, which is Portuguese for ‘home’. We want our Nandocas (Nando’s staff) and our Guests (Nando’s customers) to feel like they are in the home of someone close to them. And, as such, the health & safety of our guests and Nandocas is always a top priority. Implementing world-class social distancing protocols has been a key part of our strategy to reassure guests we are doing the right thing. It is part of our Standard Operating Procedure so to speak. Of course, a strategy is only as good as its execution, so we have even created ‘Health & Hygiene Champions’ in each Casa to make sure the protocol and practices are carried out consistently and with rigor.

* Guests have the option of viewing digitally accessible menus from their mobile phones and can make cashless payment options to avoid the handling of cash money.

* Manduca hand washing & sanitizing every 20 minutes is part of the Standard Operating Procedure. All work surfaces and stations get the same treatment. And, as an extra precaution, where appropriate, Nandocas wear masks and gloves.

* Guests have access to a number of foot-operated sanitizer pumps and a hand wash basin on the main area of the Casa (something which was a feature of all our restaurants even before Coronavirus).

* Everyone (Nandocas and guests) are subject to temperature checks before entering the Casa.

* As far as self-serve drinks are concerned, we serve the drinks directly from the bottles/machines and services to customer tables rather than letting the customers fill the drinks themselves, thereby reducing the risk of cross-contamination. 

As new hygiene norms and standards have come into play, what training model did Nando’s devise to instill the same in the staff for their everyday working?

Restaurant operations are run tightly by what we call a Standard Operating Procedure or SOP. Many of the health & hygiene protocols we are following have been a part of Nando’s SOP even before the arrival of the Coronavirus. These SOPs have been further bolstered during this time with even more rigorous and frequent practices. They have to become the norm, and not the exception under the circumstance – and hence the approach of the SOP. As mentioned earlier, we have even created 'Health & Hygiene Champions' in each Casa to make sure the protocol and practices are carried out consistently and with rigor. So, it is essentially a peer-to-peer training model if you will, but someone specifically and deliberately accountable for it. In this new “normal” we understand that before it becomes automated behavior it will require ongoing and detailed training – and that is just what we will do.

Please comment on the recent Nando’s CSR initiative with RobinHood Army. What was the inspiration behind and vision for the initiative?

People have always been at the core of the Nando’s values, especially the value of ‘family’. We consider our staff, our guests, and the people in the communities in which we operate as a family. Feeding people is what we do, it’s what we love to do! So, when we get a chance to feed people and do some good by helping those in need, it gives us even more purpose. Being a purpose-led company is part of the global Nando’s DNA and Nando’s India is no different. With the current pandemic, the livelihoods of the less fortunate have been affected way beyond what we as a country could have ever imagined. Many in our community do not know where their next meal would come from. We want to do our part, to the best of our ability and feed those in need. We have partnered with the Robinhood army to help serve up over 25,000 meals across communities in need in Delhi NCR, Bangalore, and Chandigarh. All the meals have been cooked with love and packed with health and hygiene, as we would do for anyone eating a Nando’s meal, in a Nando’s restaurant, or wherever they choose. As a brand, we are so fortunate to be able to do such things. This is not the first and it won’t be the last.

According to you, how has the landscape of the Food & Beverage industry changed due to COVID-19?

The demand for off-premise consumption (take-away and delivery) has increased exponentially. More and more consumers want to be able to shop their favorite brands (including food brands) from wherever they are and have it delivered to them. This presents an opportunity for the food & beverage category, especially for the brands in the Casual Dining category, and more so those brands whose primary service channel has been dine-in. It has essentially opened up another potential occasion for those consumers who want their favorite restaurant food in the comfort of their own homes. Typically, up until now, brands have relied heavily on third Party Aggregators to service the delivery channel because they have had the critical mass. Now that delivery is becoming a meaningful contributor to sales, it makes it more viable for brands to have their own e-commerce and self-delivery platforms. With health & hygiene standards becoming a key factor in consumer brand choice, there will be a shift from the unorganized to the organized sector. This doesn’t mean we will neglect dine-in, it just means that now there is another significant serviceable channel that needs the appropriate investment whilst the dine-in trade continues to build back up.

What do you see Nando's experience looking like in 5 years? 

We will always serve the world’s best tasting, flame-grilled, PERi-PERi chicken – that won’t change. How and where we serve that chicken may change as consumer needs change but, for now, we still believe in the opportunity that both dine-in and off-premise present. Affordability and creating better access to Nando’s via a number of service channels will be key to the brand’s continued success.