Anjan Chatterjee, ahead of the curve
When restaurateur Anjan Chatterjee, 59, wants to have a conversation, he doesn’t bother about time. Economy is not his strong suit. With him, the adda—or the indolent chat for which Bengalis are notorious—invariably drags beyond the budgeted time. And after a point you stop looking at the watch.
We are at a coffee shop at The Park in Kolkata, and Chatterjee, the founder and managing director of Speciality Restaurants Ltd, is holding court, fondly recalling why a top hotel in the city was once reluctant to give him a room.
“Once they almost drove me away,” he is saying, when a young manager interrupts to ask if he would care to try a snack. Chatterjee looks around the table, and, seeing that no one is interested, tells the manager he is impressed with his approach. “But no, thanks.”
Just as the manager turns to walk away, Chatterjee stops him. “Hey, I have seen you before…how long have you been working here?” he asks.
It turns out that they are from the same hotel management school in Kolkata—the Institute of Hotel Management, Catering Technology and Applied Nutrition—and that the manager has been working at The Park for five years.
“Is this your first job, young man?” Chatterjee asks warmly. The manager nods. “Oh, you are a very loyal man, but loyalty isn’t always a good thing these days. Do you figure what I mean?”
By now, the conversation, which had started as a sales pitch, has gone well beyond the manager’s comfort. Exchanging pleasantries, he walks away quickly, promising to send another round of “extra-strong cappuccino”.
Turning back to his audience, Chatterjee says he liked the attitude of the manager. “He did exactly what anyone in his position should do to generate revenue from the table. We have been sitting here for hours, and we have hardly ordered anything,” he says.
When hiring, what matters most to Chatterjee is the applicant’s attitude. “You either have it or you don’t. Skilling is never the challenge,” he says.
The thread of the interrupted conversation lost, or the point made, Chatterjee starts to talk effusively about Lebu—his upcoming restaurant in London. But why Lebu, which means lime in Bengali? Because he is obsessed with the fragrant gondhoraj lebu, or fragrant lime.
Chatterjee moved from Kolkata more than three decades ago, in the mid-1980s, starting a job in Mumbai with The Indian Hotels Co. Ltd immediately after graduating from the hotel management school. But he still looks at businesses in a “very Bengali way”.
Let’s start with pricing. All his life, his motto has been to offer food of five-star quality in a five-star setting, but at an affordable price. “Coming from a Bengali middle-class family, I couldn’t think of charging a person more than Rs800-900 for a meal,” he says.
At his flagship brands, the Mainland China and Oh! Calcutta restaurant chains, the buffets are still priced at around Rs1,000. But things are changing. His son, Avik, 25, is experimenting with new formats such as the POH, or Progressive Oriental House, at Kamala Mills in Mumbai, and it has shown that people are willing to spend much more on eating out.
The average billing at POH is Rs2,500 per person. “Can you believe it?” he exclaims. “I have always kept margins thin and played on volumes, but the time has come for me to step aside and let a new order take the business into the future,” he says.
Even as Avik is taking on greater responsibilities Chatterjee is hiring professionals in leadership positions. “We are looking at our next round of expansion, and it better be more efficient than the earlier ones,” he says.
Chatterjee admits he has learnt the hard way that expansion often leads to “spreading yourself thin”. Hence, the consolidation that Speciality Restaurants, now a 25-year-old company, is currently undergoing—the company has closed around five units.
In fiscal 2016-17, Speciality Restaurants earned Rs312 crore in revenue and made a net loss of Rs22.7 crore. The company is currently valued at Rs577 crore by its share price.
Lately, the company, which has 127 restaurants and serves around 10,000 diners every day, faced disruption in its domestic business owing to restrictions imposed by the Supreme Court on sale of alcoholic beverages at restaurants near highways. Hence the loss, Chatterjee explains. Things have started improving from the December quarter. The mandate for the new leaders is to execute projects more efficiently—get more out of every rupee spent.
Much of the expansion that he has budgeted for is going to happen outside India. The model is clear: franchise-owned, company-managed. And for him, management means complete control over operations. So, the partner brings in the real estate, and Chatterjee does the rest, including the interiors, for which he consults his wife Meenoo. Losing control of operations could potentially undermine brand equity, he says.
That’s not an easy model to sell—it has taken a long time to convince his partners and co-workers. Take, for example, Surjan Singh Jolly, a British national Chatterjee has “hijacked” from an international five-star chain to run Lebu in London.
“I asked Surjan to check with his wife (who is also a British national) if she wanted to carry on in India or move to London,” Chatterjee says. Seated next to him, Singh, a celebrated chef, smiles, admitting that it wasn’t easy to give up what he was doing to take the plunge.
But Singh’s British passport doesn’t solve all his problems. Chatterjee now needs the British authorities to allow him to hire Indian cooks. “I have to have my own cooks there, but the British authorities are sceptical about letting Indians in on work visas,” Chatterjee says.
A solution seems to be in sight. He has proposed that the companies involved can be held accountable for the cooks returning to India and not taking up permanent residence in the UK—the companies can ensure compliance. The British authorities have yet to agree.
Over the years, Chatterjee has made a lot of friends, and perhaps some enemies. But he definitely seems to have made more friends than enemies, which was evident from the way Speciality Restaurants’ initial public offering of shares in 2012 scraped through on the last day of subscription.
He wasn’t ready for the share sale, but still had to provide an exit to a private equity investor who had pumped in money five years earlier. “The Sensex fell sharply for two consecutive days (during the window of subscription),” he recalls with horror.
Many of his friends today are people he has served through decades as a marketing professional. After a brief stint at the Taj group in Mumbai, he switched industries to join ABP Pvt. Ltd—the publisher of newspapers such as the Anandabazar Patrika and The Telegraph—to sell ads.
“It was a plunge from the cosy interiors of a Taj hotel to the streets of Mumbai, selling ads in newspapers that didn’t even have editions in the city,” he recalls. But it was at this job that he learnt the most, and, eventually, in 1989, he went on to start his own agency, Situations Advertising and Marketing Services Pvt. Ltd, after working at the Taj and ABP for about five years.
It isn’t an enterprise he has scaled up a great deal. Even so, it remains close to the heart of this first-generation entrepreneur.
“My father was aghast at my decision to join a hotel management school,” he recalls. Though he didn’t stop him from pursuing a career in the hospitality industry, he advised him to “do something cerebral”.
It was in pursuit of something cerebral that he started his own agency to advise companies on marketing strategy. His early clients were the people he had met as an executive at ABP. In time, they have grown to become leaders in their own right, and many of them still consult Chatterjee.
The Mumbai-based Rathod family is one such example. The family runs Wim Plast Ltd—the maker of Cello kitchenware—and now has Chatterjee on the boards of its companies.
As a marketing professional, Chatterjee had understood that efficient strategies could only be fine-tuned with sweat. Stepping out of the comfort of his office, he travelled across the country, visiting stores and distributors so his clients could understand what they wanted, and decide marketing strategies based on “market realities”.
Having mastered the art of selling, he turned to his first love: food. He started a small restaurant in Mumbai called Only Fish in 1992, targeting the Bengali diaspora. It didn’t disappoint. Soon, another opportunity popped up to expand in the suburbs and he grabbed it with both hands. In 1994, he launched Oh! Calcutta and Mainland China in Mumbai. Still, these were only stepping stones: “In the early years, I barely managed to keep my head above water,” he says.
As the dynamics of the business change, Chatterjee has decided on the role for himself. The key to any successful enterprise is consistency and quality, he says, echoing Bengali entrepreneurs, many of whom have passed up opportunities to grow. But not Chatterjee: While he focuses on these two pillars of business, he is paving the way for his company to explore new ways to expand and shore up profitability.
“In our line of business, the offering has to be authentic and relevant at the same time,” he says