Big deal over a humble food

Jumbo King turns four today, taking vada pav to unforeseen heights

On Tuesday Jumbo King vada pav blows out the candles on four years of successfully granting respectability to an unsanitary but popular street food.

August 23 has been earmarked by Dheeraj Gupta, the architect of the brand,as testament to their success. His single-product food business today churns out a Rs 7.5 crore annual turnover, a 300 per cent jump from last year.

But competition is also not far away, for every Jumbo King stall there exists at least five traditional vada pav sellers around it. But the product differentiates itself from its country cousins by having established a tradition of hygiene. So there is a central kitchen, blast chillers, a cold supply chain, an oil management system to ensure there is daily oil rotation, and even the first ever hands-free automatic vada making machine.

"Nobody imagined that a mass-market business could employ all these technologies, pay 12.5 per cent value-added tax, be a 100 per cent white operation and still offer a product at Rs 5," says soft-spoken Gupta.

The newest value proposition on offer - Project 80 degrees, is an attempt to ensure that no matter what's the time of day, a vada pav being served is at an optimal 80 degrees C.

"We tell our customers that if it is taste you're looking for, then Jumbo King may not be the tastiest vada pav, but it is the most hygienic choice you have," says Rita Gupta, Dheeraj's wife and business partner. But taste and health are not too far from their minds either.

For those who can afford it, there's now a healthier option - brown bread pav, and for an additional race 5 you can add an extravagant slice of cheese. Notwithstanding these latest options, Jumbo King has done well so far to keep focus on their source of volumes - the common man.

Says Gupta, "For the masses who can't afford all food groups in their meagre diets, we realised we had to try and provide them with as much nutrition as we could. So besan was added to the bread for protein, and onions for roughage."

Jumbo King's strategic positioning near train stations, where both footfall and buying occasion is possibly the highest, is canny. But what's even smarter is that Jumbo King has adopted a franchise model for incremental growth, only 2 out of their 13 outlets are company owned. For an affordable Rs seven lakh, an entrepreneur can set up a Jumbo King stall, provided, and this is key, the entrepreneur runs the business himself, full-time.

Gupta clarifies, "I tell them to shut down their existing businesses because this is a 12- hour a day, 365 days of the year business." Jumbo King ensures they are supplied by a central kitchen and lops off a straight 4.5 per cent from franchisee sales.

"Like with any relationship, as long as you're giving much more than you're taking you will do well. The investor gets a return of 50-60 per cent in 18-24 months, and we get incremental growth with no investment capital," explains Gupta.

Jumbo King is looking at 50 stores by the time they turn five next year, and a tentative test run in Pune.

"We're not worried about growth because investments are taken care of. Sales will always be aggressive because there are persons whose livelihood depend on it. Quality will be maintained because he then wants the opportunity to start a second store," says Gupta.

Three months ago, Gupta sold their Andheri (W) company-run store to a franchisee at cost. Since then, sales have witnessed a 20 per cent rise and stall running costs have fallen by 15 per cent. "It's very simple," says Gupta. "The new owner compared with the old manager, was interested in selling those 10 extra vada pavs a day."

Rita Gupta, who looks after the branding and marketing functions, is looking forward to rolling out customers contests at their outlets.

"We will offer prizes that a common man paying Rs 5 would never dream of winning. It's not like a departmental store where you have to spend Rs 3,000 for being eligible for rewards," she says excitedly.

"It is all about making a big deal over a humble food," she adds. while a day dedicated to vada pavs might seem excessive, there's no denying that the Guptas, with Jumbo King, have made an august success out of a commonplace food and on a shrewd business model.