Sagar Daryani Curated

CEO and Co-Founder, Wow! Momo

CURATED BY :  

This profile has been added by users(CURATED) : Users who follow Sagar Daryani have come together to curate all possible video, text and audio interview to showcase Sagar Daryani's journey, experiences, achievements, advice, opinion in one place to inspire upcoming entrepreneurs. All content is sourced via different platforms and have been given due credit.

  • Expansion and Turning Point for Wow Momo

    When the duo starts getting a positive response from customers, the managers of hypermarkets approached them and offered kiosk space in their other branches also. In 2010, they opened their first independent outlet at Sector V in salt lake, Kolkata with an investment of Rs.14 Lakhs. Later they decided to expand in other cities also, and thus in 2011, opened Wow Momo outlet at Phoenix, Bangalore. Today they have more than 95+ outlets all over India. They designed their menu in such a way that their smallest kiosk of 7*7 generates revenue of more than 12 lakhs per month. During their expansion, they never raised funding as money wasn’t a problem for them. They kept their model simple with 16 types of Momos and three types of sauces. They did not know the formalities of new business and faced many difficulties initially. But because of their simple model and marketing tactics, Wow Momo crossed the revenue of 100 Crores. In July 2015, they raised their very first funding of more than $2 million from the Indian Angel Network. In May 2017, they raised Series-B funding of INR. 440 million. Since then there is no looking back.

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  • Expansion and Turning Point for Wow Momo

    When the duo starts getting a positive response from customers, the managers of hypermarkets approached them and offered kiosk space in their other branches also. In 2010, they opened their first independent outlet at Sector V in salt lake, Kolkata with an investment of Rs.14 Lakhs. Later they decided to expand in other cities also, and thus in 2011, opened Wow Momo outlet at Phoenix, Bangalore. Today they have more than 95+ outlets all over India. They designed their menu in such a way that their smallest kiosk of 7*7 generates revenue of more than 12 lakhs per month. During their expansion, they never raised funding as money wasn’t a problem for them. They kept their model simple with 16 types of Momos and three types of sauces. They did not know the formalities of new business and faced many difficulties initially. But because of their simple model and marketing tactics, Wow Momo crossed the revenue of 100 Crores. In July 2015, they raised their very first funding of more than $2 million from the Indian Angel Network. In May 2017, they raised Series-B funding of INR. 440 million. Since then there is no looking back.

    View Source:

  • Expansion and Turning Point for Wow Momo

    When the duo starts getting a positive response from customers, the managers of hypermarkets approached them and offered kiosk space in their other branches also. In 2010, they opened their first independent outlet at Sector V in salt lake, Kolkata with an investment of Rs.14 Lakhs. Later they decided to expand in other cities also, and thus in 2011, opened Wow Momo outlet at Phoenix, Bangalore. Today they have more than 95+ outlets all over India. They designed their menu in such a way that their smallest kiosk of 7*7 generates revenue of more than 12 lakhs per month.

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  • Initial struggles and Marketing tactics

    Fortunately, they managed to get a 6*6 kiosk at Spencer’s Retail in south Kolkata on rent at 18% revenue share per month. They used bright yellow colour for kiosk to do promotional activities and marketing campaigns. They always had a product-oriented marketing campaign. Binod and Sagar used to wear Wow Momo t-shirt and go up to customers with a tray of momos for sampling, as they didn’t have money for printing leaflets. People started understood their concept and on the first day, they had a sale of around Rs. 2200 and touched Rs. 53000 at the end of the month.

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  • Begining of Wow Momo with Rs.30,000 and a small kiosk

    When these young guys were struggling with lack of funds, that is when Sagar’s parents came forward and offered an initial investment of Rs. 30,000. Sagar also convinced his family to let them use the ground floor of their relative’s house in Jadavpur at the kitchen, on which they agreed. In 2008, they gave their idea a name of Wow Momo. A 200-square-foot kitchen with one table, two part-time cooks on a nominal salary, raw material taken on credit from a local grocery shop became the ingredients of their fledgeling business.

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  • How the Journey of Wow Momo Began

    Sagar Daryani and Binod Kumar Homagai apart sharing the same batch and course of M.Com at St. Xavier’s college in Kolkata, also share their love for momos. Binod being a resident of Nepal, naturally had that love of momos while Sagar used to eat momos from momo-seller outside his school. One thing that Sagar observed and learned from that momo seller was that one could do variations and make quality momos in a short span of time. So he decided to do experiments with Momos and shared his idea with Binod. When Binod heard the idea, he immediately jumped in it. But the real problem was of initial funding.

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  • What’s Your Message To Aspiring Entrepreneurs?

    If you have dreams, chase it and win. Don’t be scared, fight it out.

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  • What Is Your View On The Dangerous ‘Momo Challenge’?

    That is just nonsense; no one challenges ‘momo’ rather everyone eats it!

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  • You Have Received The National Entrepreneurship Award 2016 From Ministry Of Skills Development And Entrepreneurship, Government of India. Tell Us About It.

    We are very happy for that since it helped us get good recognition in the business and start-upcommunity, whichin turn, helped us in gaining investor confidence in raising funds. Our company currently employs over 1200 people of which about 40 are specially-abled or from various NGOs the company has partnered with. We have a long-term vision of opening five cancer hospitals fully funded from this venture to assist patients who cannot afford its treatment.

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  • How’s Your Experience Of Business Here In Odisha?

    It has been a brilliant experience, because within a year, we have opened 10 stores here. People are very supportive and they judge the taste very well. We are planning to open some stores in Rourkela very soon.

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  • What Is The Speciality Of ‘Wow! Momo’?

    We have turned one snack into a meal. We have experimented a lot with momosand our menu caters to 12 different flavours of momos available in steamed, fried and pan-fried formats, largely in white and brown flour variants. Even our dessert is a Chocolate Momo. This monsoon season, we also launched 'Mango Momos'.

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  • What Was The Most Difficult Period You Faced In Your Journey?

    For an entrepreneur, struggle is a part of life. It’s up to you how you convert every struggle into an opportunity. The initial three to four years were full of struggles, and even today, we continue to struggle to maintain our quality and expand business. Sometimes it’s hectic but you have to challenge yourself regularly.

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  • How Has The Journey Been So Far?

    I belong to a middle-class family and got into business when I was in the sixth grade selling shirts and trousers at my father’s shop in Gariahat Market in Kolkata. I and Binod were 21years old when we thought of turning into entrepreneurs. With an initial amount of Rs 30,000, we started the venture. While I looked after brand expansion, marketing and retail operations, Binod focused more on production and quality control. Soon another college friend, Shah Miftaur Rahman, joined us. He took care of cost control and finance. Our initial stores were kiosks inside hypermarkets of Big Bazaar and Spencer’s in Kolkata, which further paved way for opening of outlets in malls, tech parks and subsequently restaurants in busy commercial locations.

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  • How Did The Idea Of Introducing A Momo Chain Come To Your Mind?

    I was not a good student. But I knew I had to earn and make a living somehow and that’s when I thought of launching a brand someday. There was this aunty who used to make momos when I was in school. I remember whenever I would buy one plate, there would be only one piece left for me as my friends would grab the other pieces immediately. That made me realise that there is a demand for good momos. During that time, there were big pizza and burger brands already but none had thought of turning momos into a brand! And, I knew that if one could provide good service with good quality food, creating a brand isn’t a tough job. That’s how ‘Wow! Momo’ was born. The idea was simple. Ifforeign brands like Dominos can become a household name in our country,why can’t we do the same and take our very own ‘Wow! Momo’ to different countries? We wanted to be India’s version of Mc Donald’sand grow globally.

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  • How has GST affected your business? What do you hope the government will do for you and other startups in the region?

    If we talk about the food sector, then we have been very badly hit with the ‘no GST’ input. For a business like ours which is in growing at a rapid pace, the GST input was around 7 percent, so it makes a profitable business like mine a break-even business since we don’t increase prices. So, now the government has reduced the GST and if I increase the price, it won’t be consumer benefitting, and that makes us sufferers. The minute we increase prices, the attraction of sales will come down to an extent. I personally feel that the GST needs a relook. I think a 5 percent tax and no input is being a bit harsh on the entrepreneur. You know when you are growing, you want the government to be more supportive.

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  • What is the future of QSRs in the East?

    East is a market which loves to eat so the future is phenomenal. We see so many brands coming up in this region, raising funds – all of this development is very promising and very inspiring. With the entire HoReCa industry growing at 40 percent, East is the place to be now since all other regions are tapped.

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  • What are the biggest bottlenecks in the East Indian retail industry at large as per you?

    People have a perception that what works in the whole country, works late in the East, so everything comes here a little later than the rest of India. Take for example fashion – a fashion store in other parts of the country would have a more updated collection than in the East. Indian brands have realised that this is a problem and are now making sure that fresh stocks and designs are available in the East as soon as they are in other parts of the nation. This will get better only through word of mouth in the retail community and people like us who are the torchbearers of retail in the East have to make sure both national and international brands and investors know that the East has the power to pay and buy.

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  • Let’s shift gears a bit and talk about the Eastern food retail market. What’s your view of it?

    I personally feel that Kolkata, which is the heart of East India, is the food capital of the country. People there understand the taste as well as product quality better. Another thing is that people don’t shy away from spending on food and clothes. Most QSR chains in East are the highest in the country. I feel the region was explored a bit late, but the fact that it was explored late is an advantage. A lot of juice lies here. The North, South and the West are all discovered, and every brand wants to come East and try and get mileage and traction and revenues from here.

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  • Are you on track for an IPO in the next 5 years?

    An IPO is still five to seven years away for us, but the challenge is not an IPO, it’s in doing a blockbuster IPO. We are on the verge of being IPO-ready, but we are not quite there yet. It will take a few more years. The target is to make sure that we don’t let our consumers and investors down, and that we give them an epic IPO.

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  • What other technology are you using in your outlets?

    We are building a new ERP system with the help of an agency for Wow! Momo, which will connect the point of production to the point of sale. For a growing concern like ours, taking care of the bottomline is very important and for this, number crunching and data is very important. Connecting point of production to the point of sale makes our projection better, it will lead to reduced food costs, reduced wastage as well as extension of profits. When you are growing your management information system reports should be so crisp that they should enable you take decisions on the ground, on time, and reinvent yourself again and again – one of the main reasons why we are investing in this technology.

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  • How much of these funds do you spend on digital marketing?

    We have a marketing budget of 4-5 percent, and mostly through social media. We do spend a lot on Facebook, Twitter and Instagram marketing, but we do it differently to attract consumers. We use our social media to make our consumers our brand ambassadors. Honestly, the best form of marketing for us is to open new stores, outlets and kiosks and be more and more visible.

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  • What are your revenue targets by 2020?

    By 2020, we’re hoping to hit a revenue turnover of Rs 300 crore per annum, in the range of 16 – 17 percent EBIDTA margin. In 2015, we had raised a funding of Rs 100 crore from the Indian Angel Network and then in 2017, we raised another Series A+ funding from Lighthouse Funds of Rs 44 crore. We have not diluted much, and we will be going in for more rounds of funding in the future too, but you know, equity is more expensive than debt, so we will try and avoid equity. We have internal accruals, so funding will definitely be in the future as we grow. It’s part and parcel of the game as you grow. However, I honestly think that our customers are our lead investors.

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  • Are you thinking of category expansion?

    Most certainly. This summer we are launching a beverage called Wow! Thunder. We’re playing with fountain drinks to create mocktails. So, thinking out of the box is very important for us. Food and beverage together is a great combination for us to work on since it just adds to the EBIDTA margins.

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  • How often do you churn your menu?

    For us, taking out stuff from the menu is as important as adding more stuff, because if you keep on adding, it becomes a very wide menu and people get confused. We try and add two new momo variants every year and remove a couple. The idea is to give the consumer something different every now and then. For example, last mango season, we had mango momos.

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  • Is there a pricing strategy that you are looking that now that you are entering Tier II cities?

    India is a country where people have money, they want to spend it, but they want good products in return. Their aspirations are high, but unfortunately, the availability factor is missing. When we opened in Bhubaneshwar, we had a 1 km-long queue of people waiting to eat our momos. So, the aspiration levels are high, they have the money – you just have to give them the right retail stores, or the right food formats and they are happy to spend.

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  • What about the interiors of India? Are you exploring those too?

    We’ve already entered Tier II cities. The first one we’ve entered is Bhubaneshwar, one of the most happening cities of East India and we’re doing phenomenally well here. Bhubaneshwar, Puri and Cuttack have become a full segment for us. We have one single kitchen catering to all these three cities. Other cities that we are exploring are Lucknow and Kanpur. I think Tier II is where the juice is. I don’t think it’s tough at all to expand into smaller cities. They’re all developing now with the advent of the Internet and e-commerce. Raw materials are easily available for businesses to flourish and logistics have really improved. So, if I don’t get something in a Tier II city, I can easily ship it from a Tier I city. I think this is the right time to enter Tier II cities, because the entire eco-system is ready.

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  • Are you going to take the momo global?

    We’re certainly thinking of it. We’re exploring places in the Middle East, we’re exploring areas in Bangladesh. So, if not now, in the near future, certainly yes.

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  • The Wow! Momo store in South City Mall store was a game-changer for your brand…

    So, it goes like this. Spencer’s in Kolkata gave us space for a shop-in-shop store –19 feet of space. From here we started doing numbers like Rs 6-7 lakh a month. We decided to use the money to open an outlet at South City mall, the best mall in Kolkata at that point in time (now it’s gone in for renovation to become even better, I’ve heard). Our outlet in this mall was what made us a brand. People would come here for movies and would want a quick bite. It became a game changer in the sense that we used the money we saved from here to open two more stores, we saved money from those stores to open four more and so on. By 2020, we hope to hit the 350-400 mark in terms of outlets.

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  • How did you come up with name Wow! Momo?

    When people ate the momos we made, we wanted them to say “wow!”, and we ensured that our momos were good enough and that our product quality brought the customer back to us. And you know what they say – one good customer brings in 10 more customers.

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  • Tell us about Wow! Momo. How did you conceptualize the brand?

    We are the country’s largest momo chain. We have 155 outlets across 10 cities and we are producing 2 lakh momos a day. We are a proper startup! We’ve come up the hard way because a decade ago, there was no talk of startups. When we began eight years ago, we had just Rs 3000 and today we are at Rs 300 crore annually. Our first few stores were funded by our customers. Now, we are on the verge of a massive growth. What has made us ‘wow’ is that we’ve really played with momos. Earlier we only had chicken and vegetarian momos. We’ve introduced pan-fried momos, chicken momos, burger momos, baked momos, tandoori momos and now we’re coming up with a pizzeria momo and a momo roll soon, so I think product innovation has been our key to success

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  • You are a competition with a lot of street vendors. What has been your pricing strategy?

    Yes, on the street you get momos for Rs 15, and we sell it for Rs 40. Pricing was a concern at the beginning. But ultimately, the quality of product and hygiene factor matters among other things. When you buy chicken momos on the streets, you get an onion momo. We focused more on our product rather than the pricing. When people can buy Pizza for Rs 700, people can spend Rs 100 for a good quality momos as well.

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  • You have been innovating new type of Momos for your customers. What is the ideal time to introduce new dishes or items on the menu?

    Innovation should not be done just for the sake of it but done depending upon the requirement of the business. Further, you need to learn on the go. India is a very diverse country, and you have to know the customers. You need to keep a few things simple and innovate and tweak at some parts of the menu. For example, we have a rice momos meal at Kochi which we don’t sell anywhere else. You have to adapt with time.

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  • Do you have any other concept in your mind for further expansion? Or will you stick to the momos?

    We have turned Momos into a complete meal. For the next five to seven years we will focus on Momos only. We want to become the first QSR company which is listed on the stock exchange. Further, we want to build an international brand like Domino’s, Pizza Hut and KFC.

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  • You have expanded rapidly. How do you maintain the food standards and consistency across all your outlets?

    During our expansion, we never raised funding because money was not the problem. We were doing well and knew that we would get the funding. But you need to have the right bandwidth. Talking about consistency, we kept our model very simple as we only have 15 SKUs (Stock Keeping Unit) with 12 types of Momos, one thukpa and three types of sauces. The 15 SKUs are prepared in the central kitchen and supplied to different stores. We have five base kitchens across eight cities, so we are only managing those five base kitchens.

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  • How long did it take you to build Wow! Momo?

    It has been eight years now. We started in 2008, on 29th August. We grew with our own money. Till the time we reach three stores, we had a revenue of Rs 19 crore with a little bit of debt. In 2015, we got a valuation of Rs 100 crore where we raised Rs 10 crore. We are also entering another round of funding where we are looking at tripling our valuation.

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  • How many Wow! Momo stores you are operating currently?

    Currently, we have 96 stores across eight cities, operating across four formats, primarily kiosk, food court, high-street shop with 20 people capacity and high-end street restaurant up to 1000 sqft. We designed our menu and concept in such a way that our smallest kiosk of a 7X7 sq ft size generates revenue of Rs 12 lakhs per month. So operating in different formats gives us the flexibility to enter the right location depending on the size of the shop. This makes our model scalable and also the space to expand. Also, it helps to bring down the real estate cost. We have just opened a flagship store in Bangalore.

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  • You started with a very low investment. How challenging was it for you?

    Yes, we started our business with a mere investment of Rs 30,000. We started with a small 6X6 sq ft kiosk; it was a retail shop format. In this particular format, you don’t need to make the flooring or ceiling; it was just a regular kiosk. However, we used bright yellow colors similar to the kind of the Bank Kiosks where do they do promotional activities like distributing leaflets and helping people understand their product. My entire rent for the month was very low, and we shared 18 percent of our revenue. But seeing the rentals, I got confidence that the concept might click. At that time, we never had the money to print leaflets and didn’t even hire a full-time chef. We had a part-time chef who used to come in the morning and prepare momos for us. But, we had a full-time helper who would stand at the stall to sell the momos. Binod and I used to wear Wow! Momo t-shirt and go up to customers with a tray of momos for taste sampling as we did not have money for leaflets. I was confident that our product was good and after tasting momos, customers would come to our counter to buy a full plate of Momos. That’s how we marketed our brand and our product. We always had a product-oriented marketing campaign. At Wow! Momo we decided not to spend money on hoardings.

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  • How has been the journey with Wow! Momo so far? What was the idea behind it?

    We started Wow! Momo immediately after our college. Our journey has pretty much like Bollywood movie; we started our business with a mere Rs 30,000 and reached to a Rs 230 crore business in the last few years. During my childhood, I was more fascinated by brands. I used to draw logos of Nike or Addidas brand in my textbooks. Even during my college, I always had in my mind that I would not be able to pursue MBA because I am very poor at Maths. So, clearing entrance exams like CAT was not an option. So, the question was what next after college. I always wanted to build a brand, and there is no better option than entering the food business to develop a brand. In the food business, everything works through word of mouth. Before momos, we thought of various concepts around paranthas. We realized people have played with burgers, pizzas, and continental food. But no one had experimented with momos, and that’s how the idea of Wow! Momo bounced in. There was a lady near my school where I used to go. So, she used to give the momos in 10-15 minutes, and that gives me the confidence that good quality momos can be prepared in a short span of time.

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  • What is the future of quick-service restaurants (QSRs) in the East?

    East is a market which loves to eat so the future is phenomenal. We see so many brands coming up in this region, raising funds – all of this development is very promising and very inspiring. With the entire HoReCa industry growing at 40 percent, East is the place to be now since all other regions are tapped.

    View Source:

  • What are the biggest bottlenecks in the East Indian retail industry at large as per you?

    People have a perception that what works in the whole country, works late in the East, so everything comes here a little later than the rest of India. Take for example fashion – a fashion store in other parts of the country would have a more updated collection than in the East. Indian brands have realised that this is a problem and are now making sure that fresh stocks and designs are available in the East as soon as they are in other parts of the nation. This will get better only through word of mouth in the retail community and people like us who are the torchbearers of retail in the East have to make sure both national and international brands and investors know that the East has the power to pay and buy.

    View Source:

  • What’s your view about the Eastern food retail market?

    I personally feel that Kolkata, which is the heart of East India, is the food capital of the country. People there understand the taste as well as product quality better. Another thing is that people don’t shy away from spending on food and clothes. Most QSR chains in East are the highest in the country. I feel the region was explored a bit late, but the fact that it was explored late is an advantage. A lot of juice lies here. The North, South and the West are all discovered, and every brand wants to come East and try and get mileage and traction and revenues from here.

    View Source:

  • What technologies are you using in your outlets?

    We are building a new ERP system with the help of an agency for Wow! Momo, which will connect the point of production to the point of sale. For a growing concern like ours, taking care of the bottomline is very important and for this, number crunching and data is very important. Connecting point of production to the point of sale makes our projection better, it will lead to reduced food costs, reduced wastage as well as extension of profits. When you are growing your management information system reports should be so crisp that they should enable you take decisions on the ground, on time, and reinvent yourself again and again – one of the main reasons why we are investing in this technology.

    View Source:

  • How often do you churn your menu?

    For us, taking out stuff from the menu is as important as adding more stuff, because if you keep on adding, it becomes a very wide menu and people get confused. We try and add two new momo variants every year and remove a couple. The idea is to give the consumer something different every now and then. For example, last mango season, we had mango momos.

    View Source:

  • Is there a pricing strategy that you are looking that now that you are entering Tier II cities?

    India is a country where people have money, they want to spend it, but they want good products in return. Their aspirations are high, but unfortunately, the availability factor is missing. When we opened in Bhubaneshwar, we had a 1 km-long queue of people waiting to eat our momos. So, the aspiration levels are high, they have the money – you just have to give them the right retail stores, or the right food formats and they are happy to spend.

    View Source:

  • Are thinking about expanding your outlets in the interiors of India?

    We’ve already entered Tier II cities. The first one we’ve entered is Bhubaneshwar, one of the most happening cities of East India and we’re doing phenomenally well here. Bhubaneshwar, Puri and Cuttack have become a full segment for us. We have one single kitchen catering to all these three cities. Other cities that we are exploring are Lucknow and Kanpur. I think Tier II is where the juice is. I don’t think it’s tough at all to expand into smaller cities. They’re all developing now with the advent of the Internet and e-commerce. Raw materials are easily available for businesses to flourish and logistics have really improved. So, if I don’t get something in a Tier II city, I can easily ship it from a Tier I city. I think this is the right time to enter Tier II cities, because the entire eco-system is ready.

    View Source:

  • The Wow! Momo store in South City Mall store was a game changer for your brand…

    So, it goes like this. Spencer’s in Kolkata gave us space for a shop-in-shop store –19 feet of space. From here we started doing numbers like Rs 6-7 lakh a month. We decided to use the money to open an outlet at South City mall, the best mall in Kolkata at that point in time (now it’s gone in for renovation to become even better, I’ve heard). Our outlet in this mall was what made us a brand. People would come here for movies and would want a quick bite. It became a game changer in the sense that we used the money we saved from here to open two more stores, we saved money from those stores to open four more and so on.

    View Source:

  • How did you come up with name Wow! Momo?

    When people ate the momos we made, we wanted them to say “wow!”, and we ensured that our momos were good enough and that our product quality brought the customer back to us. And you know what they say – one good customer brings in 10 more customers.

    View Source:

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