Yes, entrepreneurship can be taught in a classroom with four walls and a black board. But it is best learnt on the ground and at The Indian Institute of Management, Lucknow, (IIM-L) students get to become entrepreneurs for a year. Two of IIM-L’s most famous eating joints are run by students on a commercial basis – which means that they not only learn to run an enterprise of sorts but also make some good money.
Of the two restaurants, Just Tea has had its share of media glory but not everything is known about Gossip n’ Bite. While Just Tea began operations in 2010, Gossip n’ Bite (GnB) came into existence a year earlier.
Explains Ahmad Arsalan, a student, connected with GnB till two months ago. “Before GnB came up, there was a mess and a mini hotel called Fauji Dhaba which drummed up fine food. However, with the student population rising (from 30 in 1992 to 880 in 2012) and food tastes turning choosier, there felt a need to eat something more delectable.”
And so GnB came into being in 2009. It began with a bang – with parathas and mini meals served 24×7. Within days, it became quite the hot spot in the campus and students began patronising it more than the other eating places. “However, the group of students who ran the restaurant the first year had a question to answer. Who would run the restaurant after they passed out,” says Saurabh Mehta, also connected to GnB last year.
A speciality at GnB
That is when the idea struck. Why not sell the restaurant to the next batch of students? A bidding process was put in place and the control of GnB was transferred to the next batch and this tradition continues even today. And so, every year in the month of February, the restaurant is bid for and the ownership gets reassigned to another group of students.
The highest bidding group is given the ownership. The new owners run the shop for 1 year and also get to keep the operating profit of the year. Financial statements are provided to the bidders every year to help them value the shop and decide their bid. The average monthly sale of GnB is approximately Rs 3 lakhs and the profit margin around 20%-25%. Working capital requirements are funded by the current owners of GnB and sales to students are made primarily on credit.
Vaibhav Kumar, yet another student who ran GnB, says that the restaurant positions itself on ‘innovation and quality’ and has the maximum number of product categories. “We launch 2 new products every month on an average. Proper trials and customer feedback is taken before launching the products,” he says.
In 2012, GnB launched some 30 new products of which 90% were successful in the market and were retained as permanent products. GnB is also patronised by faculty and on an average some 600 students eat there everyday. Prof Himanshu Rai, who teaches Human Resource Management swears by the food there and dines there quite frequently.
For those involved in running the place, it is not the money-making that attracts them to this venture; it is the experience of operating it that provides the kick. Says Sairam Kandaswami: “To make sure that we are innovative and yet catering to a specific audience is challenging.”
Even during exams, students do not let go of managing the restaurant. Since there are ’employees’ which include chefs, waiters, delivery boys, at no point can the restaurant be forsaken. PaGaLGuY visited the restaurant and was amazed with the kind of food available. The chefs were friendly and willing to even tweak a recipe to include some ingredients and exclude others and the service was quite fast. There are a couple of chairs to sit and enjoy the meal, but students prefer just chilling out close-by.
Students having fun near the restaurants
The workers did have a lament though. The summer months, when classes are closed and the campus is devoid of students, they have to close shop and return to their native towns. “I try to put up some small eating stall back home and also help in the fields but those months are thanda for us,” said one of the chefs.
Just Tea is another restaurant run on a similar pattern. Founded by a student Ghazala Tabassum in 2009, it began with an initial investment of just Rs 25,000, with bursting revenues today. According to Rachita Ratan, a student associated with the place, the joint started as a tea shop serving tea and 2-minute noodles and today has turned into a complete food outlet, serving breakfast, lunch, snacks and dinner along with beverages. Menus change according to the season – for instance there is Pakodas/Bhajia when it rains, Biryani on weekends and the recently introduced chicken dosa and chicken & veg nuggets is served all the time.
A Just Tea stall serving chicken? Answers Rupesh Pawar, another student connected with the restaurant: “We are aware of the fact that the name affects our positioning adversely but sadly, it can’t be changed due to legal restrictions.”
This outlet currently employs 12 people who include chefs, managers and delivery boys. The salaries for the staff are paid by the students. Whenever a new product is to be introduced, there is a lot of experimentation. “The exact formula for our Hotdogs came up after five recipe experiments,” adds Rachita. Ramakant Pandey informs that he conducts customer satisfaction surveys, CLTV analysis and image analysis as a part of their project in Retail Management (a marketing elective).
Like in most food operations, wastage eats into profit in a huge way and that is the only worry in the minds of the students who run this joint.
Chicken Sausage at Just Tea
Fierce competition exists between GnB, Just Tea, Night Mess & Fauji Dhaba within IIM L campus to grab the market share. Night Mess had its own inherent advantage of being supported by Mess which had prepaid accounts with all the students whereas Just Tea’s plus point is a local manager with high number of employees. GnB stands out for its array of luscious fare on stand. Students running both the restaurants spend many hours in the week discussing new products, fresh marketing techniques, employee salaries, costs, etc.
Adds Ishvinder: “It is important that students running the restaurants keep fighting for a bigger market share and higher customer satisfaction and we are certain that is good learning for us once we graduate.”
Time will tell whether the know-how picked up during college really helps them turn into cleaver entrepreneurs. Till then, the new incoming batch can try out some some hot chicken dosa or sizzling veg nuggets when light showers strike, after the new academic year begins.