Spencer’s ties up with US-based restaurant for bakery chain
16 Jul 2008
Kolkata: Spencer's retail chain controlled by RPG group has entered into a tie up with the US-based bakery, Au Bon Pain to set up a chain of fast casual dining and bakery cafes across India.
Au Bon Pain means 'the place of good bread' in French. The financial aspects of the deal have not been disclosed.
Sanjiv Goenka, vice-chairman RPG Enterprises, said that an agreement had been signed by a joint venture of Spencer's and Varin Narula, director and promoter of Au Bon Pain, Thailand, for the brand's first outlet outside the US.
A joint venture, called Novel Confectioners Ltd, has been formed in which Varin will have a small equity. Au Bon Pain is a Boston-based fast casual dining and bakery chain, which operates over 225 outlets in the US, South Korea, Taiwan and Thailand.
An amount of Rs50 crore is envisaged to be invested in setting up 100 standalone stores. In the next two years 100 stand alone stores, with an average size of 1200 to 1500 square feet, are expected to come up in South India. Initially the stores will come up in South India with focus on Bangalore, Chennai and Hyderabad.
Following this, the stores will come up in the tier one and tier two cities of northern, eastern and western states of the country. At least 400 stores of the company will be coming up on a pan India basis within the next four years.
The first store is expected to come up in Bangalore in the next six months. The company is also setting up a factory in Bangalore.
Speaking at the launch, Goenka said: ''Au Bon Pain means a place for good bread and with today's youth turning more and more health conscious, having such a store will be helpful.''
Varin Narula as director and promoter of Au Bon Thailand, has over 11 years of experience in handling the brand's franchise in Thailand.
Goenka said, ''While we felt that Bangalore, with its international population, was a great place to launch a brand like this, the other stores would be in Hyderabad and Chennai and Tier-1 and Tier-2 cities in the next 18 months. The menu would include soups, sandwiches, salads, stews and bakery items.''
Later, shop-in-shop stores would also be launched with a pan-India roll-out covering the north and the east.
Bernard Platt, senior vice president, franchising, said the privately held Au Bon Pain operates in over 200 locations in the US and other countries. Narula, who has been associated with the brand's first foray outside the US, said that based on the success in Thailand over the last 11 years, he was confident that Au Bon Pain would soon become ''India's finest bakery café''.
Spencer's has a big presence South India with its first store in Chennai dating back to 1863. The group launched its first hypermarket in Hyderabad in 2000 and has 400 stores and is planning to open 200 more this year, targeting a Rs. 2,000 crore turnover.
This is Spencer's second international tie-up this year, the first being one for kids' toys with Woolworths of the UK.
Executives from Au Bon Pain said the company are conducting conducting consumer research to determine the cuisine that would be a better fit with Indian culture. This may mean customers will find more vegetarian items on the menu.
