CategoriesRestaurant
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Announcing our intention to start a restaurant

South Indian Veg Restaurent at Puttur

I intend to start a new vegetarian restaurant from Puttur within a year.

Why new business?

Our existing coconut oil business has matured. We had taken massive loans to start and now we have almost cleared all the debts raised. The product variety and quality is established, distribution network is established, internal team is set up, e-commerce channel is doing well. To grow the business we need to hire more sales staff. Hiring and managing them is a tremendous challenge. As plan A, we will keep trying to grow the sales team. Plan B is to start a new business to grow.

What will be different in this new business?

When I started last business, I was unmarried, in my late 20s. Now I have reached 40, married and have 2 kids. So my risk appetite is much lower. So, the capital invested will be much lower, accordingly debt if at all raised will be much lower.

Selling coconut oil was through retailers. If providing a quality product is the goal of the brand, earning more margins by selling a cheaper product is the goal of the retailer. So retailer acts as a huge barrier between brand and its consumer. So, in this new business I want to reach out directly to the consumers.

What will be common?

Brand Cocoguru and the values it stands for that is pure, hygienic, safe, high quality, technology enabled, professionally managed, innovative, green food products.

Why Restaurant?

I am a foodie, I like eating. Till I reached 30, I only looked at the taste value of food and used to eat chats, Chinese, North Indian, spicy foods. Now my body is not liking them for its unhealthy nature. Restaurants are known commonly for their dirty kitchen and use of cheaper ingredients. So wherever I go, it is always difficult to find a restaurant of my choice. I believe there will be a few people like me whose needs are not met currently.

How will this be different from other restaurants?

There are many hard decisions which will upset many customers by reducing their choices and narrow our offerings significantly reducing the income opportunities.

  • Local – The food items on offer will be only traditional Tulunadu vegetarian dishes. Though much wanted, there will be no Chats, North Indian and Chinese items. An objection here could be “Don’t we anyway make this at home?”. That exactly is the idea, it should be “just like how it is made at home”.
  • Simple – The number of items on offer are only a few. Menu should fit in one page. This way we will be able to best serve the few dishes on offer.
  • Fresh – I don’t like to eat leftover food the next day. So, though it is commercially tough, we will serve only freshly prepared food.
  • Hygienic – Hygiene has been a glaring feature of our coconut oil mill. Since it is about food we take into our body and for calmness of mind, it has to be clean and hygienic. It may come with a cost but I believe people will value it.
  • Healthy – Purpose of going to a restaurant is to satisfy our taste buds. But in the long run, health is more important. So purpose is to provide food that tastes good and is yet healthy.
  • High Quality Ingredients – Restaurants are commercial ventures and customers are very price conscious. So restaurants usually end up making food with low quality ingredients. We have the experience of making and selling premium coconut oil. So, though it is tough we have to make it happen. One key ingredient is the cooking oil, all hotels use only refined and hydrogenated oils as it is cheap and can be reused a few times. We will use only coconut oil and ghee.
  • Technology enabled – I am a fan of technology and very well understand how it makes our lives easier and benefits the customers. The menu presentation, ordering, payment, order fulfilment, marketing will all be technology driven.

When do we plan to start?

The idea was thought about a year ago but execution didn’t take off. There were a lot of uncertainties due to corona virus. Also, I thought of funding the venture by selling off the land I was holding. I wasn’t able to sell it. Now it is time to move on despite the excuses. So, I have set the deadline as June 2023. Plan is to use the next 10 months to learn hotel management, perfect the recipe and taste of the dishes that will be served, work out a thorough business plan and acquire all resources required.

Where will it be located?

With lower risk appetite, lower capital and keeping it more flexible, restaurant will be at a rented place. So it will be somewhere in Puttur town wherever a suitable place is available at the time we start.

What will be the name?

Name thought as of now is Cocoguru Adigemane. Cocoguru to leverage the brand already built. The values of this restaurant will be same as that idea with which coconut oil brand was built. Adigemane to indicate that it is a local, homely, coastal Karnataka food business. 

CategoriesEmployees Management
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Salary payment to permanent employees on 1st of every month

Monthly Salary

We have been hiring frequently over the last few months in Sales roles. New joiners would have worked in blue chip companies earlier. Some of their company policies will be very employee friendly. Having an open mind and progressive attitude, Cocoguru management would like to bring in those policies here. Few of the policies suggested were

  • Bring daily allowance or food expense outside the employee Cost To Company (CTC) calculation
  • Make salary payments immediately after the end of the month
  • Bring paid leave value outside the CTC

The first suggestion has already been implemented (Food expenses to be excluded from Employees CTC) couple of months back. The second suggestion is set to be implemented now. The third suggestion is being considered but not decided.

Till now, salary payments used to happen on 7th of next month. The reasons were

  • Employees used to quit immediately after getting their salary and without serving notice period. Having 7 days of salary with the company would reduce such a behaviour
  • Calculation of salary and approvals takes some time, though done through spreadsheets it requires gathering data like attendance, commission and incentives
  • Reduces the company’s working capital requirement to the extent of 1 week’s salary

Now, we are paying salaries immediately to permanent employees because

  • Loyalty they have shown towards the company so far is being valued
  • Company trusts them to behave like responsible employees
  • Help’s employees meet their financial commitments earlier by 1 week
  • Calculations and approvals can be done faster because of more refined and automated calculation process now
  • Company’s improved financial position means it can afford the necessary working capital

However, employees under probation will continue to get their salaries on the 7th.

CategoriesBranding Coconut Oil
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Why does Cocoguru coconut oil have a longer shelf life?

I had been to Kalasa, Chikkamagaluru for developing our business there. While I was talking to a famous coffee maker Varamahalakshmi Coffee Works, he asked me how is that your coconut oil last much longer compared to other coconut oils? It was a great opportunity for me to highlight how different and superior Cocoguru coconut oil is compared to other coconut oils. Since he was curious, he listened carefully. Normally retailers don’t care, we rarely get to explain, if at all we get, they hardly listen. These are the factors which I explained

1. Copra making method
Copra is made from coconuts in 2 methods.

Ball copra
Ball copra
Fresh Copra
Fresh copra

a. Fresh copra
Here fresh coconut is cut into two and immediately sun dried to get copra. This method is followed in coastal Karnataka and Kerala during summer and Tamil Nadu. Because of its freshness it would have undergone minimal deterioration.

b. Ball copra
Coconut with shell and husk is kept in attic for a long time to let coconut water in it slowly dry. After 6 months, moisture would have evaporated and kernel inside would become like a ball and separated from the shell. This type of copra popularly called as Tiptur edible ball copra is used for direct consumption. This method is used in Deccan platue regions of Karnataka. Those that are not in regular shape and size is used for oil milling purpose. Since the copra has become old, it would have undergone some deterioration. Milling copra is selected after selecting edible copra.

To make Cocoguru coconut oil only copra made from sun drying of fresh coconuts are used.

2. Copra Segregation
Copra is segregated to select only good quality ones and bad quality ones are separated. Only good quality copra gives good quality oil despite the best of processes further.

3. Copra drying
Moisture causes rancidity in cooking oil. So, moisture is removed by drying copra using hot air before oil extraction.

4. Copra roasting
Copra roasting further removes moisture and sterilises copra.

5. Oil Extraction
Coconut oil is normally extracted from copra in 2 types of machines, rotary and expeller.

Rotary Machines
Rotary machine
Expeller
Expeller machine

a. Rotary
In rotary machine, copra with 8% moisture is crushed in a rotary machine, oil is then filtered by sedimentation in barrels for 7 days.

b. Expeller
In expeller, copra with 2.5% moisture is crushed in an expeller, oil is then filtered online through filter press.

Cocoguru coconut oil is extracted from dried copra using expeller and filtered through filter press. Popular perception is that oil that is cold pressed/wood pressed/rotary crushed is natural and superior, also it looks white/colourless. It is suitable only for immediate consumption and yet very ineffecient. Oil yield is low, moisture causes rancidity. Roasted coconut oil extracted through expeller is long lasting, safe, aromatic and tasty yet retains natural properties.

6. Fine filtering
Filtering removes solid particles and moisture, when done finely and thoroughly, it improves oil appearance and shelf life. At Cocoguru, coconut oil is double filtered.

7. Tight packaging
Packing is a way to hold, protect, carry and exhibit the oil. When done well, it goes a long way in ensuring shelf life and convenience of use. In our case shelf life increases from 6 months in PET bottles to 12 months in Jerry Cans.

8. Inventory management
We carefully manage stocks at manufacturing, distribution and retailer points to ensure the stocks are fresh and in good condition, so that consumers get fresh stock.

Overall, it is about careful taking care of each aspect of manufacturing and business process, not about chemicals and preservatives. For many manufacturers their scope ends when their products reach the wholesalers, for us it is about consumer experience.

CategoriesEmployees
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Food expenses to be excluded from Employees CTC

Cocoguru Team
Renovated Canteen

Company runs an in-house canteen to provide fresh and hygienically prepared food to its employees 3 times a day during working hours. However, the cost of serving food was budgeted and included in an employee’s CTC. Actual expenses were deducted while paying monthly salary. To employees working in the sales team i.e. working on the field, food budget was included in their CTC.

Now, starting December 2021, the company has decided to bear the food cost and not include it in employees CTC. Permanent sales employees will be given a daily allowance. This is good news to employees as their take home component increases.

Why was food expense part of CTC?

Initially, employees were always dissatisfied with the perks offered. They unfairly compared with that of other firms locally and complained. They did not realise the non-cash benefits the company offered like ESI, PF, food at canteen, paid leaves etc. They only compared the take home component, with other firms who didn’t offer any benefits but only cash. Management tried to convince, but employees refused to acknowledge.

Initially, food at the canteen was free and was not included in CTC. Then, employees had issues with the quality of food given. They wasted food carelessly.

To sincerely take care of employees, management used to conduct employee satisfaction surveys to understand what aspects can be improved in its employee engagement. Employees only had negatives, all the positives done were simply taken for granted.

A few employees couldn’t wait till the month could end and wanted payments in advance. While the company itself had taken a huge loan to fund the project and working capital.

It was difficult to satisfy employees and smoothly carry out operations. Management thought enough was enough. Let us do our best and not care about whether it would please the employees. And the following employee policy decisions were taken.

  • All the benefits given would be quantified and included in CTC
  • No salary advance
  • No employee satisfaction surveys
  • Salary revision only after annual appraisal
  • No scope for salary negotiation at all, if you are satisfied stay else quit

Few employees stayed, and got new employees to join with these terms. As employees stayed and performed, policies were made liberal.

  • Start time changed from 8:30 am to 9:00 to reduce working hours by 30 minutes
  • Festival holidays 10 days in a year given company wide was excluded from CTC
  • 1 hour time given in the afternoon to allow employees to attend functions once in a while
  • Though ESI share fell from 6.75% to 4%, CTC was not changed, so take home component increased
  • Compensation given above market standards
  • Though CTC was increased by a certain % every year, the food budget remained constant for the last 7-8 years.
  • Bonus on profitability, given extra every 6 months

Now, we have many employees who are working with us for more than 7 years, are performing well and are taking ownership. So, we will further liberate the policies.

CategoriesEmployees Sales
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How employees of earlier generation worked

Mahalingeshwara Bhat
Mahalingeshwara Bhat with Cocoguru Team

Couple of days back, our Sales officer from Udupi quit within 2 weeks of joining. Because working for 8 hours a day was not feasible for him. And today, I met Mr. Mahalingeshwara Bhat, Area Sales Manager at Jyothy Labs Ltd at Mangaluru market. He narrated his story and this inspired me to write this post. We met for hardly 5 minutes, still his experience had a lot of wisdom for me.

He is now 55, past the retirement age at his company. He has maintained fitness levels to work in the market after traveling for an hour from Puttur. Working in the market, walking, talking is physically very demanding.

Jyothy Labs may be a billion dollar revenue blue chip company now, but when he joined way back in 1990, it was a small company. He is financially well off now, but at the time of joining his salary was 1,000 per month. His father was a small time cook. He and his company stuck to each other and grew together.

He worked for 32+ years and carried the brand he worked wherever he went. His friends used to call him Ujala Bhatru. He feels proud about it. Employees of these days, feel ashamed to wear work uniforms outside work and they don’t like to associate them with the company/brand outside.

He was assigned with the responsibility to set up the market at Gujarath in early 2000. That is recruit and train sales staff, appoint super stockists and distributors. It is very far from his native place, hardly gets to travel back and meet family. He didn’t even see his newly born son for a couple of months. Still he is happy about the opportunity and responsibility the company has given him. It took him figuratively and literally to places. These days employees consider is outside their scope to travel beyond their office place.

During 2002 Gujarath riots, he was locked at a lodging for 3 days without any food and then the lodging owner provided food prepared at his home. He didn’t get angry with the company for the situation he was in. He understood that it was a external situation that was beyond his or company’s control.

He has grown slowly and steadily within the company and is content about it. Being content with what we have is the real recipe for happiness. He must have seen people much younger to him, with Engineering or MBA degrees from premier institutes getting into higher positions or drawing higher salaries. He must have seen colleagues jumping across companies and getting short term growths. He must have seen various types of bosses during his long career.

He still has the gratitude for the company for providing his daily bread and all the progress he has made in his life. Through he is very right if he thinks, he got his bread for the effort he has put into company’s business.

Though we cannot expect the present generation of employees to work like earlier generation, it is worthwhile to observe how it was earlier.

Disclosure –
Murali M, Operations Head is his wife’s younger brother.
Tharanatha S, ASM was reporting to him 10 years back while he was working at Jyothy.