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Narendra K. Pasuparthy, an engineer-turned-entrepreneur, calls himself the ‘Chief Farmer’ and CEO of Nandu’s Chicken. A second-generation entrepreneur, Narendra chose to start his career by opting to work outside of his family business for over a decade. His responsibilities with the company are varied and include finance and accounting, marketing, sales and production and customer satisfaction, among others.

In an exclusive interview with Restaurant India, CEO Narendra K. Pasuparthy reveals how using modern technology has helped Nandu’s Chicken in securing the repeat customer base.

The Journey from Working As An Engineer to Becoming the Chief Farmer and CEO at Nandu’s Chicken

Basically, I am an engineer. Back in the early 90s, I went abroad to pursue my Master’s in Information Science from The University of Texas. After that, I worked in the tech space for about 10 years. From a software programmer to an engineering manager to software sales, I have played various roles at different companies. In 2005, I decided to return to India. I came back with an objective of joining my family business, Nanda Group. My father started the poultry breeding business in 1963. We are one of the oldest and largest poultry breeding companies in southern India. We’ve been in the poultry business for over 55 years now. We have breeding farms across southern India - Karnataka, Tamil Nadu, Kerala, Maharashtra and Andhra Pradesh.

We produce around 4 million chickens a month.

Until 2016, we used to sell away the chicks and fully-grown broilers to the market. We have our own hatcheries. We have more than 3,000 farmer customers across South India. About three and a half million chicks are sold to the farmers which they grow on their own and bring into the market for meat. As a company, we ourselves grow about 500,000 birds – we convert the chicks into broilers in about six weeks. And then we would sell the live birds in the market.

My objective in 2005 was to come back and modernize this business by implementing the idea of socially responsible farming. We are among the first in India to implement the socially responsible poultry farming. We said we won’t pollute the environment using the diesel generators or by throwing away the chicken litters, which emits hazardous methane gas. We started using solar power; we were the first company in India to use solar power at our poultry farms. We started converting each of our farms into a solar-powered - our objective since 2007.

To give an example - one farm uses 650 litres of diesel per month. By using solar power, we are able to reduce the diesel consumption to 40-50 litres per month; it’s 10 times lesser. After seven years, which is the payback period, we don’t have any extra cost at all and we are not polluting the environment. The solar power is a big part of our poultry farms.

Secondly, we also started the biogas process. Where we take the chicken litter and take it into the biogas plants, extract methane from that. We have successfully put that technology in place where we are processing around 4 tons. All our farms are completely modernized. We use a lot of robotics, PLC controllers and automation to take care of the birds for feeding and watering purpose.

In 2016, we started Nandu’s, which is basically a tribute to my father whose name is Nanda Kumar. We wanted to convert the live birds, we are growing through our poultry farms, into fresh meats. That is when we took a stand to produce all our chicken chemical-free. It took about 9-10 months to develop a growing program which didn’t require any use of the antibiotics. I have a team of about 15 people just to grow the poultry that we use for Nandu’s. We hand-selected the farmers, trained them on growing the chickens in a bio-secure (healthy) environment. So that the birds don’t get sick and, thus, this way no medicines or antibiotics are required.

Our focus is also on the cleanliness of the farms and the health of the birds. At every stage from production to processing, we take care of the health of the birds so the end consumers receive an all-healthy, all-fresh, chemical-free produce.

The Concept of Food Miles at Nandu’s Chicken

Now that we are producing the birds without any chemicals, we put the processing plants closer to the city – that’s based on the concept called food miles – which means how far is your meat travelling to get to your home? The more it travels, the more it is polluting the environment. We wanted to pay attention to that as well. If the consumption centre is at Bengaluru, we will put the processing plant near the same city. Our competitors’ products travel 200-300 km a day while Nandu’s chicken travels only around 80 km. We are very conscious of the number of food miles.

"The speciality of Nandu’s is – it comes from one company which is completely integrated, meaning everything is in-house. We, truly, are farm to fork concept. There are no middlemen involved. That’s how we are consumer-focused."

~ Narendra K. Pasuparthy, CEO of Nandu’s Chicken

Future Plans of Nandu’s Chicken

To get such transparency also on to the blockchain. We are working on putting all the information on the blockchain, so that consumers can trace everything and say, this is from where my food comes, and then to take the consumers through our own retail stores.

We have 20 stores in Bengaluru; one is opened recently, and by the end of January 2019, we aim at opening 25 stores. By the end of 2019, we aim at opening 50 outlets of Nandu’s Chicken in Bengaluru. We are also planning to expand our operations in other southern states. The plan is - every six months we want to open our business in one of the states.

Current Annual Sale at Nandu’s Chicken

Currently, we are privately held. What we did last year, in terms of revenue, we will be doubling that in 2019. We are growing around 15% month-on-month. 92% of people are our repeat consumers. All we do is – we just let them taste the products and they stick with us.

Customers and Partners

We don’t have any middlemen between us and our end-consumers. We have our own e-commerce store. Recently, we have partnered with Dunzo, BigBasket, DairyNinja and more. Majority of our business comes from our own website or retail stores.

Promotion Strategy with Nandu’s Chicken

We are the only company in India which is 100% integrated, with retailing included, online and offline. There are four ways to order chicken from Nandu’s – website, call centre, retail store and delivery.

In terms of promotions, we are heavily using social media, to advertise the brand. A lot of our promotion also happens through the radio. Since we are present both online and offline, there are different types of activities we do for the customers. Typically, for offline promotions it is the BTL activity like event partners, fliers, running promotions, contest, cooking shows for women focused on the quick-serve menu. We are also doing value-added products like chicken tikka, malai tikka, chicken popcorn, chicken nuggets. We, recently, launched 23 value-added products.

For online promotions, we are very heavily dependent on Facebook, Instagram, Google Adwords and Google Display Network. We run online SMS campaigns. We have more than 50,000 customers that we serve.

The Best Thing About Working in the Family Business

I’m a second generation entrepreneur. We started Nandu’s from scratch. We have support from the Group Company – Nanda Group. Without our family business, Nandu’s couldn’t have given the value proposition which we are able to give today. Working in the family business for Nandu’s is great.

The traceability, transparency and expertise in growing poultry – all these come from the 55-year-old poultry breeding experience. Nanda Group alone is a 700-people company and Nandu’s, today, is 150 people strong. To make Nandu’s possible, almost 850 people are working towards delivering great quality to the end consumers.

And from a cultural perspective, I can say, since we are a family business, our values and culture is very strong. And this culture is a very strong ingredient to attract great talent. People associated with us are empowered, and everyone is an intrapreneur. We are a very flat organization. We encourage participation, opinion-sharing, delegation. Any successful organization you see today, they have a very strong fundamental culture of the organization. This culture of our family business which I am able to draw for Nandu’s is of great advantage.

The Processed Meat Businesses in India

If we look at the buying habits of people, 15-20 years ago, it was very different than it’s today. Earlier, the concept was if it is alive it is fresh, now the concept of fresh has changed. The young generation, today, wants the meat to come from a healthy source and to be handled very hygienically in a structured manner. 90% of our consumers haven’t visited a live butcher’s shop. People want to align with a brand that can actually promise the quality of their food. They need to know from where the meat is coming from. The whole dynamics are changing.

When the thought, “Where is my food coming from? What am I feeding my children?” continuously bothered Narendra Kumar Pasuparthy at restaurants and he exactly knew what had to be done next. Hailing from a family that bred and sold chicken, it only helped him reach his goals much sooner. With eight veterinarians and three nutritionists to look after the poultry, Nandu’s Chicken is probably the only brand in the country to breed and sell fresh chicken through its own retail chain.

Take us through the journey of Nandu's Chicken.

Nandu’s chicken is a part of 55-year-old company Nanda Group and we mostly sell our live birds to traders. In 2006, when I returned home from the USA, every time I had a meal with my kids, I wondered where the chicken came from and how safe was it to consume. The butchery stores are most often very low in hygiene. Since we had our own feed, hatchery and farm, I decided we should reach the consumers directly. As the last mile of processing and retailing was missing, we decided to launch that as well. In 2016, the retail chain was open for sales. We now have 10 stores in Bengaluru and plan to expand in a phased manner.   

The meat consumption industry has largely been an unorganised sector. What are the challenges?

Well, to begin with how to reach the consumer is always a challenge for the industry. Also, the quality of meat is compromised because sometimes infected birds are mixed up with other birds.

There is still a gap in the online delivery of meat products. How does Nandu's plan to contribute in bridging this gap? 

We are largely a physical retail chain. Although, we have our own website, app and a call centre to take orders. We are not a pure online player. However, the market for online delivery of meat products is small and much of our customer base prefers to walk into the store, take a look and buy the meat. We charge a convenience fee of Rs 35 for delivering within 5 km distance and will continue to work that way.

What are your fiscal targets?

The Nanda Group is a 400-crore company and Nandu’s Chicken is self-funded. We are significantly present in all Southern states, but will focus on the market in Bengaluru. Our target is to achieve Rs 1 crore revenue per store in a year’s time.

What business model do you follow and are you looking at franchising model?

We are putting technology in place to operate seamlessly, but for now we are company-owned, company-operated. Franchising is not on the radar for us at the moment.

What are expansion plans? (Both offline and online)

We have 10 stores in Bengaluru already and the target for 2018 is to launch at least 10 more . Eventually, we plan to take our brand to prominent cities in a phased manner. Soon, we will also be expanding on a store-in-store model.

How was Zappfresh started?

Whenever I went to a meat shop, I observed that majority of the customers in these butcher shops are men whereas in Indian households larger part of meals are cooked by women. Bridging this gap and empowering the person cooking the meats became important. So, now majority of our customers being women stands as a befitting testimony that we are on the right path.

You have raised two crore in angel round of funding from investors. Where do you plan to use them?

Technology is core to our business and we plan to build our technical competencies with due diligence to operational robustness. We are a customer centric business entity and we plan to harness the funding to reach out to a wider customer base pan India through clever strategic marketing. Experiential marketing will form a major chunk of the spending in our marketing exercises. Also, we are aggressively eyeing four major metros in next six months, and we expect to expand our product range as well to cater to all possible consumer tastes.   

Tell us something about your business model?

In our case we have automated the entire supply chain through tech. The customer can order through website, whatsapp and call and soon we will be launching an app also.  We function on an inventory based model where we maintain daily “fresh stock” straight from Govt. approved firms only and we are stringent about zero tolerance to old stock and discard it without a second thought. We currently fulfil our orders through two hubs based out of Delhi and Gurgaon to cover these two hungry cities.

What is the range of items? What makes you different from your competitors?

We have fresh meats, fish, pork, chicken sea food and ready to eats. Currently we have 60 SKU’s on the list and we are looking to stretch it to 100 in next six months with sheer focus on innovative high quality products.  We are prime movers in the Hyperlocal cold chain technology in meat space delivery; first in India. Currently, in the territories we function, we do not have any competition.

What are the barriers you face during online order and delivery services?

At present we haven’t faced any; rather our customers are quite comfortable ordering online as well as through call/whatsapp. Our user friendly website offers a comforting experience to the user and online payment and wallets integration has only made the deal sweeter for them. Since, we are in a temperature sensitive product line; we do not compromise with cold chain logistics. In fact, it is our forte being immense pride to us. Our mobile app is also in the offing to bring our products to one touch experience for our 10,000 happy customers.  

What all is require to maintain fresh high quality meat?

360 degree cold chain logistics and stringent quality norms are paramount to the industry we function in. Temperature abuse is primarily the only component that can alter the quality of a good produce

What is current revenue and targeted revenue?

We are currently doing 10,000 orders a month (on an average per month revenue to the tune of 2.1 million INR) and we want to take it to 30,000 a month and raise the average ticket size to INR 1000. 

What is your expansion plan?

We are aggressively eyeing four major metros in next six months as well as we are looking to expand our product range to cater all possible consumer tastes. Our ultimate aim is to be a preferred “one stop meat player” offering high quality fresh produce for everyday requirements of Indian consumers by promising hassle free delivery, highest standards of hygiene, ease of buying and timely delivery with technology integration.

DSM Fresh Foods Pvt Ltd based on Gurgaon, which runs Zappfresh an online start-up for raw meat and associated ready-to-eat food products, has raised Rs 2 crore from angel investors.

The company plans to use the money to upgrade the technology and expand its services to new cities.

Zappfresh offers a wide variety of items including whole chicken, mutton and pork. Now, it is also planning to introduce seafood category soon.

Zappfresh procures meat from the farms and claims that it ensures the product reaches the end customer in 90 minutes once the order is placed on its portal.

Currently, the firm is operational in Gurgaon and south Delhi, though it charges for small ticket delivery outside Gurgaon.

Launched by Deepanshu Manchanda and Shruti Gochhwal former MobikWik employees four months ago, Zappfresh competes with Bengaluru based Licious which has raised funding last week.