From Japan to Jamshedpur: Pod n Beyond wants to popularise capsule hotels in India

The Japanese concept of capsule hotels comes to India, with just a few minor adjustments.

It was the middle of 2014, and 43-year-old Ravish Ranjan was stuck between a rock and a hard place. He had been an entrepreneur since the age of 20 but now his consultancy business was going through a rough patch.

Resources were in short supply and debts were just mounting. With no idea about how to deal with his financial difficulties, Ravish did some introspection to figure out what he could do next. He had shut down 16 offices across India, let go of more than 120 people and cash flow was negative. Ravish had sold off his house and had to take loans from family and friends to clear off his debts. He had managed to keep some money to use in the next phase of his life.

After much thinking, Ravish decided then that he would focus on an area where he could leverage his strengths: he was a people’s person and the hospitality business was an attractive option.

Working on an ‘amateurish’ idea

“That perhaps was the eureka moment, which over another few days of intense thinking and self-debate, evolved into the idea of getting into the hospitality business. But it had to be unique and different,” Ravish recalls.

After some basic research, he got the idea of a capsule hotel, also called a pod hotel, but something that was affordable for people looking to put down their heads after a long day at work, away from home. Capsule hotels originated in Japan as a way of providing people working late and staying far from their homes (or partying till late and too drunk to go home) the option of simply spending the night at a comfortable, no-frills hotel.

Affordable, for Ravish, didn’t mean dingy – he was sure he wanted to give the Indian consumer quality and value for money. He zeroed in on Jamshedpur and that’s where he started P

od n Beyond smart hotel in November last year.What’s on offer

Here, customers have the option of booking short stay options, starting with just an hour to a full day or night, to long-stay options of a week or even a year. There are options of such as the 20 sqft personalised pod to a single, double, bunk, family, and group pod-stay accommodations. There are also options of booking an entire floor, a queen-sized pod and a 260 sqft king-sized pod with all the star rated amenities.

Tariff ranges from Rs 799 to Rs 1499 for a day’s stay to a modest Rs 199 to Rs 499 for hourly stays. Guests can also order food, which is available 16 hours a day. “We also facilitate self-cooking or ordering from elsewhere. There are basics like salt, milk and sugar available. Our motto is to give the guests a home-like stay at Pod n Beyond with star-hotel-style comfort, and services,” Ravish explains.

The pods are modified bunk beds and while inspired by Japanese capsule hotels, don’t have all the amenities like a TV set.

More than just a place to crash

While pod hotels have grown beyond Japan and cropped up across the world, they are not yet a mainstream offering. Bringing the concept to India, then, was a definite risk. The first big challenge Ravish faced was to get potential team mates (and later, customers) to overcome the mental block of the apprehension that comes with having to “share” accommodation with strangers.

While Ravish decided he would go ahead anyway, conceptualising, designing, funding, searching for the core team, and making the property operational were all severe challenges. Explaining this further, Ravish says,

“This was accentuated by the fear of not having any experience in the hospitality business. Also, finding the right workforce which could understand the concept, customer acceptance of the pod concept, achieving financial breakeven and profit with a sustainable business model at such a low tariff while also providing complimentary breakfast, laundry and Wi-Fi – it was a nightmare of sorts. Further, selling the pod concept to corporate travellers and online travel agents was a big stumbling block. It took us almost two years to make the hotel operational.”

But with the concept clear in his mind, the next order in business was to build the team that could help set up the hotel and get the operations running. Having built businesses, Ravish wanted to take it slow, so he decided to bootstrap his way through, using what little personal savings he had and mortgaging his property to fund the business.

“Currently we have a small but efficient and lean team of 16 people covering housekeeping, kitchen, security, IT, accounts, front office, HR, admin and relationship manager to support staff, apart from me,” adds Ravish.

Taking the concept beyond Jamshedpur

The concept of pod hotels seems to be gaining some popularity in India. In April this year, Mumbai got its very own pod hotel, UrbanPod, in the suburb of Andheri. UrbanPod claims to have over 140 pods priced from Rs 2,030 plus taxes, including breakfast, per night on a single occupancy basis.

Occupancy at Pod n Beyond currently stands at 20 percent, having clawed its way up from just 1.5 percent in November 2016, 2.75 percent in December and 7 percent in April 2017. By the end of this year, the team hopes to clock annual revenues of Rs 2 crore.

Ravish aims to set up similar properties in over 40 locations by 2020 and is aiming at a gross turnover of Rs 100 crore from NCR, Bengaluru, Pune, Ranchi, and Kolkata, besides locations on pilgrimage destinations like Katra, Shirdi, Tirupati and Gaya.

“We are primarily looking at own funding/bootstrapping in phase one, followed with angel funding for phase two expansion and finally growing with VC funding to achieve nationwide reach in the next 3-4 years,” concludes Ravish.