India likes to drink tea. On average, Indians drink two or three cups of tea a day. There are a few people I know who get depressed if they don’t take their dose of tea at regular intervals. So it makes sense that there is a ‘CHAI WALA‘ on almost every street corner. Today we’re going to talk about a company that took the concept of CHAI on another level. The company name is Chai Sutta Bar. (1) They have grown so big that we have a Chai Sutta Bar franchise in over 250 outlets nationally and internationally!
The Beginning of the Chai Sutta Bar
Anubhav Dubey, the founder of Chai Sutta Bar, was born in 1996 in Rewa, Madhya Pradesh. His mother and father always imagined that Anubhav would one day work for the Indian administrative service. (2)
Therefore, after completing his studies, he was sent to Delhi to prepare for the UPSC exams. Anubhav, away from his family and friends in the nation’s capital, lowered his head and began to prepare for the difficult exam.
However, he was not destined to be an IAS. During his studies, Anubhav came into contact with Anand Nayak, his childhood friend. Among other things, they discussed tea, which was their favorite drink. They discussed that maybe they too could start a tea business. But as we discussed, there is a tea stall on every corner. Anubhav and Anand decided to start a chai business with a twist!
The shops at Chai Sutta Bar are styled like a liquor bar and smoking area! However, these two things are not allowed in their stalls. Nevertheless, the concept resonates with young people. This led to them growing 2 times a day and 4 times a night.
They opened their first tea stall in Indore in 2016 and have never looked back. Working with an extremely limited budget, the two co-founders quickly recognized that they had no funds for marketing, interior design, branding and other similar activities.
However, the brand quickly gained a loyal following and was able to launch stores in the three cities of Indore, Bhopal and Ujjain.
Today, the Chai Sutta Bar franchise is present in more than 150 cities across three countries, operating more than 250 outlets, and its annual turnover is over Rs 100 crore.
How to Start a Chai Sutta Bar Franchise
Before you start your own Chai Sutta Bar franchise, you must fully understand the details regarding Chai Sutta Bar franchise cost, designs, expertise needed, rules and regulations, practicality, etc.
You can opt for the Franchise Owned and Operated (FOFO) model or the Company Owned and Operated (COCO) model. (3)
In the FOFO model, Chai Sutta Bar charges a cost for the use of its brand name when rented. When the brand is leased, an agreement between the company and the franchise owner must be signed. In this scenario, the franchise investor is the owner and the franchise is responsible for paying all business expenses.
In the COCO model, the company manages all major aspects of the business in this regard itself. The franchise money comes from the business itself, and the workers in the business are the ones who run it.
Chai Sutta Bar offers the following three types of outlets:
The Kiosk is the most condensed form of retail space and typically features a limited selection of food and beverages. The seating area measures between 300 and 400 square feet.
The Mediumthe location is slightly larger than a kiosk but smaller than a mega location. It has a smaller seating area but offers a much more extensive menu.
The Mega is the largest type of location that Chai Sutta Bar has, and it offers customers the entire menu and a sizable seating area for those who love chai.
Additionally, Chai Sutta Bar prefers future franchise owners with previous experience in the food and beverage industry. This preference helps ensure that franchise owners can manage business operations without difficulty.
In addition, your chances of making a profit increase directly based on your experience. Experience allows you to develop strategies and create a business plan that helps grow your business.
Even if you have no prior experience in the food and beverage industry, it is possible to operate a chai sutta bar franchise.
Chai Sutta Bar training and support is available as you start your business. It helps you formulate a plan and understand the type of business that will work best for you.
Location requirements for the Chai Sutta Bar franchise
Just like other food and beverage businesses, the success of your Chai Sutta Bar franchise will be greatly influenced by the location you choose. The rule of thumb is to choose a site with the potential for the most foot traffic, as this will help you attract more consumers, which will ultimately lead to increased revenue.
Chai Sutta Bar Franchise Cost
A growing number of people are investing in brand franchise opportunities. You have to pay a franchise fee of Rs. 6 misses and a 2% annual royalty for the acquisition of a franchise. Moreover, the cost of machinery, interiors and raw materials can easily cost you another Rs. 10,000,000. You can expect a return on investment of around 30-40%.
Should You Start a Chai Sutta Bar Franchise or
The concept introduced by the Chai Sutta Bar brand is unique. There have been many other teahouse franchises that have sprung up over the past 3-5 years. The market is expanding.
It therefore makes sense that if you want to start a tea business, you can collaborate with people with experience in the field. So, if you have decided to start a tea business, you can consider the Chai Sutta Bar franchise.