Eight million meatballs, four million ignited samosas, dal makhani and biryani. That’s the quantum of food IKEA India’s restaurants have vended since the Swedish cabinetwork retailer opened its first store in 2018. In line with IKEA’s business strategy encyclopedically, food and libation( F&B) is an essential reciprocal addition to its core business of dealing ready- to- assemble cabinetwork in India too.
IKEA isn’t alone in generating a healthy F&B profit sluice, which is now an appetisingnon-core diversification for companies across colorfulnon-food sectors, including airlines, playhouses and theme demesne drivers.
PVR Playhouses, the country’s largest legion driver, earned Rs 1,145 crore from the trade of F&B in its multiplexes in FY23, exceeding the entire functional profit of Pizza Hut and Barbeque Nation, which was Rs 700 crore and Rs 1,074 crore independently.
During the same period, IndiGo dredged in Rs 766 crore from in- flight deals, primarily from F&B deals. Since F&B deals are the primary motorists of India’s consumption growth, especially after the post-Covid reopening of the frugality, companies with corenon-F & B businesses are looking to buttress their F&B verticals in the pursuit of better client experience and bettered profit perimeters.
PVR Playhouses, which intermingled with INOX Leisure in February this time, reported an increase in its F&B profit share to 32 per cent in FY23 from27.8 per cent in FY19.
INOX’s F&B profit share in FY22 was27.3 per cent compared to PVR’s 31.4 per cent. before this time, company officers had indicated that PVR plans to boost its F&B profit share to 35 per cent of total operating profit.
For comparison, AMC Theatres, the largest chain of playhouses in North America, had an F&B profit share of33.6 per cent in 2022.
PVR- INOX didn’t respond when asked for commentary. In absolute terms, PVR’s F&B profit stood at Rs 1,145 crore in the rearmost financial time, a tripartite increase from the time before when it was Rs 381 crore. “ Growth in F&B spend per head was driven by increase in consumption at playhouses and commodity- linked price affectation, ” the company notes in its rearmost periodic report.
As lately as last week, PVR- INOX tied up with Costa Coffee to offer coffee and related potables in its theatres. presently, Costa Coffee operates 112 stores in India, with an functional profit of Rs 102 crore.
PVR also sells F&B products outside of theatres through its attachment Zea Maize Private Limited, which clocked in Rs 49 crore in FY23 by dealing under its brand name, 4700BC. Encyclopedically, IKEA generates F&B profit worth over$2.5 billion.
In each of its three India stores — the first of which opened in Hyderabad in 2018 — IKEA operates 1,000- seater restaurants with immolations starting from Rs 30. Ankit Ghai, IKEA India’s Country Food Manager, said, “ Our 1,000- seater restaurants, across our stores in Bangalore, Mumbai, and Hyderabad, are among the largest in the country. We’ve vended 8 million meatballs since our first store opening as well as 4 million ignited samosas, dal makhani, and biryani. ”
