30-sec summary
Tea holds a special place in the hearts of Indians, with its consumption deeply ingrained in the culture. From street corners to high-end cafes, people from all walks of life enjoy a refreshing cup of tea. This demand creates a viable market for entrepreneurs to enter the Chaiwala business and tap into the vast potential it offers. In recent times, the Chaiwala business model has gained immense popularity, going viral across social media platforms. It has sparked curiosity and raised several questions in the minds of people. Is it a startup? Why are they going viral? Should I also start my own tea stall? In this blog, we will provide answers to those questions and delve deeper into the Chaiwala business phenomenon.
Restaurant Model vs. Thela Model: Pros and Cons
The Chaiwala business model can be implemented through two primary infrastructures: the restaurant model and the thela model. Each model has its own set of advantages and disadvantages, and entrepreneurs must carefully consider their goals and resources before choosing the appropriate model.
RESTAURANT MODEL
The restaurant model comes with high operating expenses, making it challenging to achieve a significant return on investment (ROI). Expenses such as staff salaries, electricity, rent, and raw materials can be substantial. Moreover, to attain ROI, the restaurant must offer high-quality snacks in addition to tea. This model mainly suits metro cities, as customer expectations are different in tier 2 and 3 cities, where the experience matters as much as the tea itself. Pricing also needs to be higher to ensure ROI.
THELA MODEL
The thela model, on the other hand, offers advantages such as movability, low operating expenses, minimal labour requirements, and no need for electricity or rent. Prices can be competitive and lower, attracting more customers. However, this model may face challenges in providing a high-quality customer experience due to hygiene issues and the impact of weather conditions. Authorities and market disputes can also pose interference.
Is the Chaiwala Business Model Suitable to be called a Startup?
The term "startup" typically refers to a venture that aims to solve an existing problem in a unique way, often leveraging innovation. However, now starting a tea stall is also being classified as a startup, and people are saying that selling tea is way better than having a job. But the main issue these Chaiwale are not able to understand is that if everyone goes for their own business, then who will buy the things they depend on from those who are employed and using their product? Just to glorify it, they compare the salary, but they forget that they are talking about sales, not the net income from that business.
The Viral Chaiwala Phenomenon
The Chaiwala trend has become extremely popular for many reasons. One of the main reasons is the unique names associated with them, such as "Btech chai wali" or "MBA Chai Wala." These attention-grabbing names help them attract customers and also catch the interest of short creators and food bloggers who use them as content. This aspect plays a significant role in the popularity of these trends.
Another reason for their popularity is their distinctive style. For instance, there is a chaiwala named Dolly who tries to portray the iconic Rajinikanth style while making or serving tea. This unique style of presentation further captures people's attention. Through effective marketing, these chaiwallahs are gaining fame for their stall names, which creates brand recall. If these names are trademarked, it becomes easier to enter the franchise model and establish a consistent source of income.
The Pitfalls of the Chaiwala Business Model
While the Chaiwala business model may appear enticing with its potential for revenue, easy money, and opportunity, it is crucial not to overlook the associated risks. Often, the allure of success can overshadow the potential pitfalls that lie ahead. To ensure a sustainable venture, entrepreneurs must be aware of the risks and take necessary precautions.
A poorly chosen spot can result in low footfall and limited visibility, hampering the business's potential. For example, if you are planning to open a full-fledged restaurant or cafe, opting for a tier 3 location may not be ideal since people visit cafes for the experience, not just for coffee or tea.
Inconsistency in quality, unprofessional behaviour, or negative customer experiences can also affect the brand's reputation, causing irreparable damage. Diligent efforts to uphold high standards of cleanliness, exceptional customer service, and unwavering product quality are vital to protect and enhance the brand's image.
Wide variations in taste between different outlets or even within the same outlet can disappoint customers and deter them from returning. Standardising recipes, using high-quality ingredients, and conducting regular taste tests are essential measures to minimise this risk and ensure a consistently excellent product.
By acknowledging and actively addressing these risks, chaiwala businesses can enhance their chances of success and establish a strong position in the competitive market. Taking proactive measures to mitigate these risks will not only protect the business but also ensure customer satisfaction, loyalty, and continued growth.
Our Opinion
Entering the chaiwala business can be a good decision, but it's important to have the right information and do proper research. Without knowledge and planning, the business can face destruction. A good example is the Chai Sutta Bar model, which focused on their product and services instead of just creating hype around their CEO. They built a well-structured business around it.
It's crucial not to believe everything that is being sold to us. We need to take ownership of our decisions and be cautious. Blindly following trends or relying solely on hype can lead to disappointment and failure. It's essential to gather information, do research, and make informed choices based on solid business principles.
The success of a chaiwala business depends on more than just catchy names or gimmicks. It relies on the quality of the products, consistent taste, excellent customer service, and careful planning. By focusing on these core elements and establishing a strong foundation, the business can grow and thrive in the long run.
As entrepreneurs, it's important to adapt to changing trends and meet the evolving demands of customers. Engaging with customers, seeking their feedback, and continuously improving the offerings are key to staying relevant in the market.
What do you think?
