BakeryBiz, Jan-Feb, 2021
A degree in psychology would generally lead one to a platform which works towards social and behavioural aspect of people. However, in the case of Arjun Chugh, owner of 7th Heaven, the decision was to offer a range of tempting cakes to satiate the customers and create what arguably is India’s largest chain of cake shops with over 200 stores across the country. The USP of having a live kitchen concept at all their outlets that offers customised cakes baked in just 7 minutes, has been their customers’ delight. He speaks to Bakery Biz about the journey and the way forward.
7th Heaven, from its 1st outlet in 2013, has grown over the years to be ranked as India’s leading brand. Tell us more about the journey and current positioning?
Arjun Chugh: It’s challenging to sum up our tremendous journey from 1 outlet to more than200 stores in a few words, but I’d say it’s been both highly grueling and undeniably rewarding at the same time. Marching on through the dynamic and cut-throat Indian F&B industry wasn’t a simple feat, but with continuous innovations in our business approach as well product line, creative and thorough marketing strategies, and onboarding the sharpest chefs in the country in our team, paved the way for us to be where we are right now – the largest bakery franchise in the country spread across85 cities in 21 states.
What are the future plans for the group?
If I answered with brevity, our future plans are centered around large-scale expansion. We envision ourselves as being present in every town and city of each state of the country, along with venturing abroad. In fact, our first International store is on the brink of officially opening in Dubai, and that’s just a sliver of where we’d like to be placed Internationally. Our long term goal is to emerge as the no.1bakery brand on a global scale.
FACT SHEET
- The 7th Heaven network employs over 1000 people directly and many more indirectly. It contributes to a big job creation and supporting livelihood for over 1000 families.
- During the day, someone enjoys a 7th Heaven product in every 6seconds, somewhere across India.
- 7th Heaven is present in the smallest towns to the largest cities in India. You will find a 7th Heaven outlet in almost every corner of the country. From J&K, Leh – Ladakh, toManipur and Nagaland
- On an average, a 7thHeaven outlet opens every week.
- 7th Heaven is the only Bakery Chain which prepares cakes in front of the customers in 7minutes.
- 7th Heaven makes 3D cakes in any shape and design (on the same day itself) as per the customers’ requirements.
- 7th Heaven has developed an unique, first of it’s kind recipe for eggless macarons which are not available anywhere.
What according to you is the USP of your success? Any words of advice for others in the business?
I’d definitely consider our Live Kitchen concept as one of our primary USPs, along with the distinctive franchise model we follow, our same-day delivery option for customised cakes, and our massive menu of baked goods available under one roof. As a word of advice to other businesses, I’d say resilience and innovation will take you a long way. If your business is your dream, you have to be willing to invest, not just financial resources but also time, effort and a truckload of patience.
Tell us more about your franchise options? What are the various aspects involved, the cost elements, etc.?
Our franchise model is ideal for all first-time business folks who are passionate about owning their own bakery. Ata much cheaper cost which excludes expenses you’d otherwise incur on doing your own research, then getting equipment, material, staff, inventory, etc., you get the option of starting your store. Because we’ve been doing this for a while, we already have answers to questions you’d end up spending time and money on solving. So, opting for a franchise model makes starting your business not only much more economical, but the process is also easier and smoother with our professional guidance. Our franchise models have a starting investment of Rs.18Lakhs. And out outlets not only offer bakery products, we have café models too where we serve Pizzas, Burgers, Waffles, Sandwiches, Thick shakes and many other products.
Which is the one product from your outlet which you would rate as the best? What makes it special?
Well, from a sales point of view our customised cakes do extremely well. Mostly that stems from the same-day delivery option we provide, along with the promise of exceptional quality. But on a more personal note, my favourite product is the Triple Chocolate Cake. I order it nearly every weekend, so the whole family can enjoy it together. It’s deliciously chocolatey, warm, and mouthwatering, but to be entirely frank, it’s the feeling of togetherness that makes it extra special to me!
What is your go-to place for bakery products (besides your own outlets) – within India or Internationally?
Naturally, we love relishing good desserts and baked goodies so we keep experimenting with new places. We love The obroma, LSD, Rolling Pin, we try to check out as many as we can, no matter how big or small the outlet maybe. Internationally, having traveled extensively, we find it difficult to locate bakeries that make eggless desserts and baked goods. So though they are very tempting, often we are left with very less or no options.
The bakery business has been seeing a major change over the last few years. What do you expect the future to be like? What are the expected new trends?
I definitely expect there to be a shift towards healthier, more diet-friendly options. The new-age consumers are a lot more conscientious about what they’re putting in their body, so I see a heightened preference for options like Gluten-free, vegan and Keto-friendly baked goods in the future. I also suppose food presentation is becoming just as critical to your sales, as the taste of what you’re selling.
FACT SHEET
Number of franchises outlets – 199
Are your outlets fully veg? – Yes, all are Veg and Eggless.
Year of Establishment – 2011
Areas of Operation – India, UAE
Number of Units – 85 Cities of India across 21 States.
No of SKUs – 150-300 depending on the model.
Production Capacity – Across all our outlets we sell approximately anywhere between 5,000-10,000 Cakes & Desserts per day.
Loyalty program – We have a tie-up with eWards and we use their loyalty program.
What is the pricing strategy you’ve adopted for your range of products?
After operating in this industry for a while, we got a hang of the kind of pricing that works for bakeries. We try to keep our products reasonably affordable, while also making sure the pricing reflects the amount of effort we put in, and the subsequent promises we deliver on. If we set too low a price, it can be perceived as a lack of quality, while in case of prices that are too high, we might lose out on sales. So striking the perfect balancing chord is the key.
Tell us about the concept of having a live kitchen?
One of the biggest customer concerns that may put them off a certain bakery brand, is stale products. So, by letting the customer watch their desserts get churned out by our skilled chefs in real time, our Live Kitchen concept adds to the credibility of how fresh our products are, as well as helps build trust in the customer. We make fresh cakes in front of the customers in 7 Minutes.
As the largest bakery chain In India with stores right up till J&K, Ladakh, how do you manage operations?
Our franchise business model makes handling operations a lot more streamlined, methodical and standardized. Since we have established guidelines on pretty much every step of the way, no one is left clueless about what to do next. Our operations are quite seamless, even if I say so myself, because of the lean and uniform systems and processes we’ve spent a lot of time putting in place.
Franchise Models & Fees
Classic Model – Cakes, Desserts, Cookies, Chocolates – Investment- 18 Lakhs + GST – Full Setup Included.
Plus Model – Classic Model + Waffles, Ice Creams, Beverages and Savouries – 26 Lakhs +GST – Full Setup Included.
Food Plus Model – Classic Model + Beverages, Continental Food (Pizzas, Burgers, Sandwiches etc.)- 26 Lakhs + GST – Full Setup Included.
Cafe Model – Cakes, Desserts, Cookies, Chocolates, Waffles, Ice Creams, Beverages, Savouries, Continental Food (Pizzas, Burgers, Sandwiches etc.) – 30Lakhs + GST – Full Setup Included.
* Also, Chinese Cuisine can be added in the Food Plus and Cafe Models for an additional cost of Rs. 3 Lakhs + GST.
