Growing an awesome F&B brand – The Zabardast story (so far)
Completely Retail first met the team at Zabardast when they presented on The Soapbox at the London Completely Retail Marketplace event in 2015. Six years on and a lot has changed. CEO of The Completely Group, Dom Millar, caught up with one of the Founding Directors of Zabardast, Neelofar Khan, to discusses the highlights and challenges of owning and managing a Food & Beverage business.
Q. Tell us a bit about the history of ZARBARDAST
Zabardast, which means ‘awesome’ in Urdu, started in 2013 with a very simple mandate: to serve healthy, homemade and fresh Indian food, quickly, with a smile. As founders, we come from different professional backgrounds and wanted to provide the European market with a fresh idea of what it means to eat really good Indian food, without the stale image often associated with this cuisine.
The company has found its success through simplicity, standardisation and quality. We operate a hub and spoke model with a Central Production Unit and customer-facing stores, catering to different dietary requirements – vegetarian, vegan, halal, gluten free, etc. We have invested our passion to perfecting a logistical and operational model that ensures our vision of delivering healthy, homemade and fresh Indian food at the point of sale.
Having started with one ‘A1’ unit in 2013, we have now opened our eighth, company owned store, in August 2020. Part of the expansion strategy is opening new stores by collaborating with development partners, store within store in addition to opening corporate stores. While central London had been our focus, we are now also opening stores in suburban areas, combining both a physical and a digital presence.
Q. How do you find new premises, investigate new towns and territories? What specifically do you look for, what’s important?
We started visiting Completely Retail Market Place (CRMP) in 2015 at Old Billingsgate, which gave us the breakthrough we were looking for. Being free for operators really helped us as an emerging brand to participate in this prestigious deal-making event. It gave us access to landlords, agents and large operators such as supermarkets. Prior to this, it had been difficult for us to get the attention of the right people within the property world.
Initially, we sought office-based, large footfall locations, focusing on the lunch-time market. Then, gradually we started looking at the combination of both office and residential areas. Following that we went for shopping centres given that CAPEX is higher in these locations. We cannot under-estimate the significance and value of CRMP to our business in opening the doors to the right landlords at the right time in our evolution.
Looking forward, we have outgrown the CPU that served us for the past three years and are in the process of upgrading to our new purpose designed CPU (dark kitchen) where, from January 2021 we will have sufficient capacity for significantly scaling-up our brand and our business. In terms of what’s important for us regarding customer-facing locations, firstly, from an operational perspective and to ensure that we can manage our logistics, we look to have new locations within 1.5 hours drive from the Central Kitchens. Secondly, as we are still a young brand, it is important to us that landlords understand our brand and have bought into the concept so that they can provide appropriate guidance and support.
We look forward to the continued engagement with CRMP as we move to the ‘scaling-up’ phase of our journey and seek to network with the appropriate landlords and agents.
Q. Have you / do you use agents to help you identify new locations, find new premises, negotiate with landlords and expand internationally?
As we have been visiting CRMP, we have not had to retain any agents. Through Zabardast sponsoring lunch at CRMP, we’ve been able to bring the brand directly to the right audience. Another way in which we have gained exposure of the brand is through using the ‘Soapbox’ at CRMP. Consequently, we have been offered great locations through these events. Through our relationship with CRMP, we’ve also visited the Nordics and Benelux with CRMP and presented the Zabardast brand and concept on the ‘Soapbox’ at these venues. The CRMP events provide the perfect platform for networking and giving exposure to Zabardast both nationally and internationally.
Q. Have you made any mistakes, and if so, what lessons did you learn?
In our early years, we negotiated a deal on a small property but unfortunately did not provide for a break clause in our lease agreement. We have now outgrown those premises and will eventually assign the lease when we are ready to vacate it. Naturally, it would have been better if we had included a break- clause but we’ve learnt from that and now include this in all our leases.
Q. In your experience how much help have you received from landlords? What things do you need to look out for when negotiating a lease? What have been the major headaches and surprises? How can landlords help more brands like ZABARDAST to prosper?
In our experience, landlords and large institutions are under a lot of pressure to just get deals done, without investing in a continued meaningful relationship with the lessee. It is only recently that landlords have started engaging with smaller brands, now that ‘food has become the new fashion’.
The Covid-19 pandemic has shone a light on the fact that cumbersome one-sided leases do not help anybody. For example rent reviews that are ‘upwards only’ do not represent an equitable position when there has been a 10% decline in GDP. It is important that going forward lease agreements represent a ‘win-win’ for both parties, taking into account, good times and bad times.
To help more brands like Zabardast prosper, there needs to be an ongoing dialogue between the asset manager and the business, with each side understanding each other’s priorities. Practically, agreeing things such as a break clause, monthly rentals and rent-free period would all be beneficial. In addition, by sharing the risks through turnover related deals or landlords contributing to capitals costs and recovering these through a higher monthly percentage turnover related rent would all help create conditions for all sides to win. No-one ever envisaged a force-majeure event like the Covid-19 pandemic, but we believe it is fundamental that clauses protecting both parties in the event of such calamities in the future will be vital.
Q. What specific facilities / needs do you have as a F&B operator? Has there been any surprising red tape to go through, any special licensing requirements?
As a F&B operator, we need 3 phase electricity, good drainage, good access for equipment and supplies and the correct planning permission. We also have a need for different kinds of equipment, for example grease-traps, and several design drawings and surveys – all extra costs for us. On top of that, shopping centres typically have layers of bureaucracy and hoops to jump through which can be challenging for small businesses. This is not surprising for bigger brands but for young aspiring brands more help to navigate the bureaucracy would be welcome.
Q. As you’ve expanded how have your logistical needs changed? Do you have a central kitchen / distribution hub(s)? What technology have you embraced? What have been the biggest investments you’ve needed to make, but perhaps didn’t anticipate.
The Zabardast model is based on a hub (Central Kitchen) and spoke (customer-facing stores) model. As we have grown, we have invested in a purpose-built kitchen and head office which will be ready in January 2021. A lot of our logistical issues such as capacity for large-scale packaging storage, a proper loading bay and on-premises parking for refrigerated vans will be immediately addressed in advance of scale-up.
Since March 2020, observing that our customer base could not come to us during lockdowns, we had to take our products to our customers. We have therefore pivoted the business more towards on-line ordering for delivery and pickup. Apart from embracing the proprietary technologies of the big aggregators such as Deliveroo, Ubereats and Just Eat, we have invested heavily in our own e-Commerce platform, our Customer Satisfaction platform and our data analytics platform. We are also in the process of rationalising the number of tablets we are obliged to manage in a store by implementing the Deliverect solution, which will allow us to have a single version of our menu across all platforms and de-clutter our stores with just one tablet for all in-coming orders.
We were an early adopter of technology in our kitchens to achieve high levels of productivity. For example, while many said it was not possible to cook Indian food without the traditional tandoor, we embraced the ‘Rational’ combi oven from day one, reducing the need to rely on expensive chefs and ensuring 100% consistency of production each day, every day. As we scale-up we will be investing again in technologies within the kitchen that will give us ever higher economies of scale.
Q. What barriers have you found for expansion both within the UK and internationally?
The biggest inhibitor to our growth in the UK is escalating costs in the form of wages, pensions, VAT, Business Rates, supplies… the list goes on…! Now BREXIT uncertainty looms and with this uncertainty, planning for investment and timing it for optimal return becomes a strategic challenge. Additionally, we face major staffing issues because there is a lack of skilled individuals motivated to work in the F&B sector at all levels.
Q. What do you do about marketing? Store design? Accounts? What new skills have you and your management team had to develop as the business has expanded? How many hats do you wear? Which is your favourite hat?
Faisal wears the ‘back of house’ hat (business strategy, head office, finance, physical and technology infrastructure, management accounts, data analytics etc) and I wear the ‘front of house’ hat (stores, product innovation, recruitment, marketing, business development, etc).
My favourite hat is most definitely ‘customer interaction’ and of course following my entrepreneurial instincts through business development. On that note, our focus in 2021 is to align ourselves with as many digital partners as possible in the ‘Home Delivery’ and ‘Food to Go’ sector. We plan to focus on lunch and dinner deliveries, office group orders and home orders.
As we begin our journey of scale-up, we will require numerous other skills and a critical success factor for us will be to recruit a management team with the requisite skills that we may not possess, as founders, but which will be vital for scaling-up to our goal of 50 stores.
Q. What has been the most rewarding part of your journey?
The most rewarding part of our journey has been seeing the growth of the brand and on the way, meeting individuals who have each shared their personal stories and challenges with me. Mentoring and training staff members, personally and professionally, has been incredibly rewarding and has allowed us to build a strong team that represents the Zabardast brand
Q. Knowing what you know now, what pieces of advice would you give someone just about to take their first lease…
We have learnt the hard way how to build both a brand and a sustainable business. With this experience, herewith some pointers:
- Make sure the concept is really tried and tested and opt for a low risk location first.
- Do the sums and financial plan covering rents, rates, fitout costs et al, again and again.
- Have a break clause after 3 years.
- Business is tiring so make sure first lease is as close to home as possible!
- Attend relevant networking events to gather information.
- Focus on getting the processes organised, HR and recruitment system in place and select a technology platform that is fully integrated from front-of-house to supply chain.
- Have a sound marketing pan for the brand on all aggregator platforms – both digitally (social media) and physically.
Thanks to Neelofar Khan, Director of Zabardast – https://www.zabardast.co.uk
The company has found its success through simplicity, standardisation and quality.
Neelofar Khan
Zabardast