How vadapav got branded? The Jumboking story
If you live in Maharashtra, then don’t forget to pick up your daily dose of vadapav today. Even better thing to do is to buy a vadapav for someone who inspires you or someone you take for granted. While yes, I love my street food, especially vadapavs, today you should all bite into this humble food, because Jumboking is celebrating its 13th Founders Day, also known as the Vadapav Day.
This celebration that the brand is having today has a very interesting story of entrepreneurship behind it. Jumboking was founded by Dheeraj Gupta, a third-generation entrepreneur from his family. Dheeraj’s family has been in the hotel and catering business and also had their sweet shops. Therefore on completing his MBA from Symbiosis, Pune, Dheeraj decided he will export sweets to markets with heavy India population, like Dubai. However, this attempt at exporting sweets didn’t work out well and Dheeraj had to shut shop.
His second entrepreneurial outing was with streetfood and he opened an outlet in suburban Mumbai, in Malad under the name of Chaat Factory. As business grew, Dheeraj realized the best selling item on their menu was vadapav and decided to do a more thorough job with this particular food product. Thus began the journey of Jumboking.
“The experience is like when you get married and you don’t know what all is going to come. You have to keep making improvements, adjustments and you will learn, marriage in the first five years is different, after children its different and keeps changing. There is no formula. Every husband and wife figure out a way,” and that has been the theory Dheeraj has also followed in business. Coming from a business family, even when he graduated in 2000 from B-school, “working outside was never an option” for Dheeraj. The business family background was an additional motivation and he plunged in headlong.
Jumboking opened its first outlet in 2001 and priced the vadapav at a premium of Rs 5 when the roadside offering was being sold at Rs 2. “People were very curious to try a vadapav in the shop, but they did come,” says Dheeraj. Being hygienic was their first differentiation. Soon there were flavours and variety — cheese vadapav, butter vadapav, schezwan vadapav — that they started offering. Sales started picking up and the company continued to constantly innovate as it chugged along.
One of the earliest things Jumboking did was to open franchise stores in Tier 1 -2 cities, in areas where there were high footfalls – like outside a railway station. 200-300 sq. ft. stores that fit well with the locations, and the customer base was the crowd rushing to catch that 5.45 local back home, or take the 9.15 train to rush for that meeting. However it was not always that the close to station, near to heavy footfall formula work. Dheeraj shares with us the instance of a store they opened near Masjid Bunder railway station.
“We got a great location, below the foot over bridge, it was that bang on a location. But over there we would not do any sales – and you suddenly loose confidence on your brand, product, sales etc. that you are proud of. And at the same place about 50 metres away, there was another vadapav guy doing brisk business and it is like rubbing it in,” reminisces Dheeraj. So deeper digging told them that the reason for poor sales despite a great location was the crowd that came to Masjid Bunder station. “We realized there is not a single office or college, the only people going there was factory and mill workers. And for them the Re 1 price difference between a Jumbo King and the other guy on the road was a big deal. Also when you have this nice clean store, where a guy gives you vadapav and says thank you, they were getting intimidated,” says Dheeraj. The learning therefore was not all crowded station locations work.
His next lesson in entrepreneurship was about the type of stores. After starting with the franchise model, in 2007 Jumboking embarked on its journey of having company owned stores. “We got a small first round of VC investment into the company. So people were telling us you should put up company owned stores, you will make more money and grow faster, so for next three years we were buying out franchisees and putting up company owned stores. But having done both, Jumboking could have had a Rs 200 crore turnover, had we not taken the company owned model. It slowed us down big time, as it took a lot of management time,” says Dheeraj.
One of the things however that Dheeraj was very clear on, right from day one was he will not dilute the brand. So over the last 12 years, Jumboking has stayed core to its food product, viz vadapav. They have innovated and built variety around the core, but not yet gone into a totally new product line. “For the first 15 years, McDonald’s only had burger, fries and Coke on their menu and nothing else. Even after 5-6 years after they went public, they only had these 2-3 things on the menu. They lavished all the attention on that one product to ensure there is no surprise when people goto eat that product. At the same time the idea was to build large volumes around that product, so that they can afford automation, modern technology and give it at a price which is affordable to the company,” says Dheeraj.
Inspirations for the journey
Dheeraj is a big fan of McDonald’s and has no qualms in admitting he is trying to recreate a similar brand with Jumboking. “If you look at the brands around you, almost 90% of them originate from the US and it’s not a coincidence, they understand about branding, which Japan never did. Even Akio Morita had to go and settle in the US, to build Sony the brand,” reasons Dheeraj. Ray Kroc’s biography has been a bible of sorts for Dheeraj.
Today Jumboking has products ranging from Rs 10 – Rs 75, but all are different types of vadapavs. Recently the brand added samosa to its menu in the form of Jumbosa, which has the food item in a different look and avatar, but the taste remains the same. Jumkoking’s manufacturing plants today have the capability to churn out 1.5 tons of patties an hour and only because they are able to mass produce the product, they are able to pass it on to the customer, says Dheeraj. He admits there are many other food categories out there, but just like a specialist doctor will always earn more than a general physician, Dheeraj is convinced specialization is the key.
An avid reader, Dheeraj draws his inspiration from a lot of books he reads, some of which include ‘Death of Advertising & Rise of PR’ by Jack Trout and ‘Focus’ by Al Ries. We ask him how he finds the time to read so much and he has an interesting explanation. “It was probably the need to understand marketing from a book at Rs 200, rather than spending Rs 2 crore with an advertising/marketing agency, that made me read,” he laughs.
Tough life of an entrepreneur
Today Jumboking is growing well and the brand has presence across nine cities in India – Mumbai, Thane, Bangalore, Aurangabad, Mysore, Delhi, Amravati, Indore and Raipur. But things were difficult in the beginning, and Dheeraj says it is important to be patient. “When I finished MBA, all my batchmates were getting fancy placements, hefty pay packets. Some were saying, you have done MBA and are competing with roadside vendors,” recollects Dheeraj. Entrepreneurship needs a lot of perseverance, people all around you are making money, getting increments, where as you are just living a dream, that you and maybe your spouse believes in and no one else. “You don’t have anyone else believing in it. Because you want to do something different, no one has done before. First 3 years is a very lonely time, where you are defying everything that has been done. People said McDonalds can do it, but vadapav mein nahi ho sakta. That is the environment you are operating in. Staff tells you, sir how about adding samosa for variety,” recollects Dheeraj.
His constant partner and companion throughout his journey has been his wife Reeta Gupta, who Dheeraj admits has been a pillar of support. Reeta is also a management graduate from Symbiosis, and has been instrumental in building the Jumboking brand. Therefore from marketing the brand, to its positioning and the associations they have done, Reeta has played an important role. She continues to be involved with the brand, but today is also an independent communications consultant.
Jumboking started making money from Day 1, but all of that was put back into the business to grow it. To get new machines, build better efficiencies. “As an entrepreneur, 2008-09 was the time where you open the newspapers and everyday you would read Reliance is acquiring 5000 square feet of retail space, Spencer is opening 500 stores, McDonald’s is opening 100 stores. As an entrepreneur it is very intimidating that I only have 10 stores. So are we not ambitious enough, you get into the rut of announcing big things,” shared Dheeraj. And one such audacious ambition did get Jumkoking into a financial mess. However when projections and calculations didn’t work out, they also had to cut staff and back track on some of their plans.
The team therefore at Jumboking have been different at different points in time — the team from 3-10 store was different, from 11-50 was a different team, the 100 store team will be different. “You have to learn more and become more efficient as a team. I keep telling my team, this is where we will be in the next 3 years, please get up and start growing,” says Dheeraj.
As they celebrate vadapav day, Dheeraj very proudly shares that they sold the 95th million vadapav earlier this month on August 15 and looking forward to touching 100 million by coming January. Just like taking up a job was never an option for Dheeraj when he finished his MBA, he believes there are no shortcuts either to success. His favourite line that keeps him motivated therefore is: Success comes to those who believe in it the most, and believe in it the longest.