The Unique Brand Elements of 'Hotel Saravana Bhavan' - An International Restaurant Chain
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Case Code: BSTR458 Case Length: 13 Pages Period: 1981 - 2013 Pub Date: 2014 Teaching Note: Not Available |
Price: Rs.300 Organization: Hotel Saravana Bhavan Industry: Fast Food Industry Countries: India, Global Themes: Brand Management, Business Strategy, Entrepreneurship, Human Resource Management |
Abstract Case Intro 1 Case Intro 2 Excerpts
Excerpts
The Growth of Hotel Saravana Bhavan
Over the next decade, Rajagopal opened 10 more outlets of HSB in Chennai and one outlet in another large South Indian city, Kancheepuram. He also became the sole owner of the business after he bought out his friend Iyer. Later, his two sons R.Saravanan and P.R.Shiva Kumar – both of whom had degrees in hotel management – became his partners.
Over a period of time, HSB moved into various avenues of the restaurant industry. Takeaway was offered at all its outlets. In addition, HSB offered home delivery of food based on the location of the order and cost. It also opened its outlets at railway stations and introduced a facility wherein customers could make an advance payment at a city outlet for food to be delivered at the railway station outlet. ...
International Expansion
In November 2000, Saravana Bhavan Private Limited was incorporated to manage the HSB outlets. It was around that time that Shiva Kumar convinced Rajagopal to open international outlets of HSB. In 2001, HSB opened its first international outlet in Dubai, UAE – a city that had a larger number of Indian expats than Emiratis. Speaking about the opening of the outlet, Shiva Kumar said, “… it was our customers who came to us and asked us to open up there. ........
Building The HSB Brand
Throughout its early years, HSB did not advertise much, except for a few billboard campaigns and newspaper ads. In the early 2000s, it took to advertising itself aggressively, especially through TV ads. The catchy ads were primarily targeted at middle class families. The new ads that sought to enhance HSB’s brand image stressed on aspects like consistency, quality, and hygiene, which were said to be the hallmark of HSB. The ads stated that HSB’s unique aspects generated customer loyalty in such a way that succeeding generations of the original patrons continued to visit the restaurants.......
Emphasis on Taste, Quality, and Service
HSB’s various restaurants had different working hours. Even the food offered differed according to the time of the day, with some foods that were available in the evening being unavailable during the daytime. HSB served only vegetarian dishes, primarily South Indian food, no matter where the outlets were located. From time to time, it also incorporated new innovative dishes in its menu. However, it continued to keep prices low and maintained its reputation as a budget restaurant.......
Focus On Employee Welfare
Rajagopal believed that the restaurant business was a service industry where one set of people (employees) served another set of people (customers) by providing them with their requirement (food). He thought that the success of a restaurant depended on taking care of all three parameters. ....
Rising Challenges
HSB had over the years, weathered several PR storms, mainly caused due to the alleged dubious activities of Rajagopal, as well as his son Shiva Kumar. In 2001, Rajagopal’s blind faith in astrology allegedly caused him to get the husband of a former employee’s daughter murdered. It was reported that his astrologer had told him that marrying the woman would result in a lot of prosperity to him. The case dragged on in the courts and in 2009, Rajagopal was convicted and sentenced to life. However, he appealed in a higher court and came out on bail. The case was expected to drag on for a few more years.....
Outlook
HSB claimed to have 80,000-120,000 footfalls each day, with an average bill size of Rs.150. Some reports claimed that the company made revenues of Rs. 1 crore each day. The restaurant chain had plans to make a foray into the Indian hospitality industry. Its future plans in Chennai included the opening of a five star hotel in Kodambakkam and a multiplex-cum-food and shopping mall in Koyambedu.....
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