[00:05:20] Josh Sharkey:
But are they,I mean, I'm sure they're like stoked now.
[00:05:22] Basu Ratnam:
I think, you know, they're, they're getting there. It's, it's, my mom, I think, you know, I take a lot of my food passion from, from her. She was an incredible home cook and spent a lot of time and energy and, It was a real passion of hers to. Make Indian food more accessible and more healthful and more approachable because we grew up in a, you know, all white town and in Long Island and I love to host.
[00:05:43]
She loved to host. But at the time, Indian food is quite foreign to a lot of people. So she was always figuring out ways to make it a little bit easier to understand healthful, bright, et cetera. She understands how I got from where I started to where I am now. My dad, I think it's been a little bit more of an adjustment period.
[00:05:59]
I heard once that yeah, Immigrant parents are driven principally by fear. And I think that that's like very much true for my dad. I think he just always worried about where my next meal was going to come from, literally. And so, you know, I left a very stable, very lucrative career at the age of 26 to open this.
[00:06:17]
And it's been, uh, I mean, we've been lucky. We were, we had great investors from the beginning and our first restaurant, we had a line out the door the day we opened. So failure was never really the thing I was worried about, but I think, um, it was just a big adjustment, you know, going from, from making a lot of money to making no money, and, uh, and I think now we're at a point where my, my dad's starting to see the vision and understands a little bit why we did what we did, but in the beginning, his first thing he said to me is like, I can't believe you're opening a restaurant, and it's not even a restaurant I can bring my friends to, you know, so,
[00:06:52] Josh Sharkey:
Yeah, it's funny because, you know, my background was mostly in sort of the fine dining and then I, I opened a bunch of my own fast casual restaurants.
[00:06:58]
I mean, I ran a restaurant group that had a bunch of fast casual spots as well. Oh, cool. And I like, I think of like scaled fast casual restaurants. I was like, Oh yeah, that's a business. Yeah. And like fine dining restaurant is like, that's a project. Yeah, it's a project. It's a project that could make money.
[00:07:14]
Sometimes it can and sometimes you can make good money on it. But it's a very, it's a completely different, You know, he, you know, when you think about unit economics and things like that, like when you start to scale something like this, it's, it's far more of like, you know, thinking about supply chain and scale things.
[00:07:29] Basu Ratnam:
Totally, totally.
[00:07:29] Josh Sharkey:
So we'll talk about that, but like, first I'm just most interested in, you know, you started an Indian concept. I'm pretty passionate because I used to work for an Indian chef here in the city for a long time. Who's that? Uh, Floyd Cardoz. Oh, wow. Okay. I know the trials and tribulations of trying to get Americans, like, appreciate, uh, you know, Indian cuisine.
[00:07:48]
It's funny because I hate even saying the word Indian cuisine because it's like saying Mexican food. Right. You know, there's like so many, there's, there's the South, there's Goa, there's Hyderabad, there's Kashmir, there's so many different areas. Sure. Like, completely different. Sure. My first question, which is like, where are your parents from and what, like, what kind of food did your mom cook? Yeah. What is she sort of like?
[00:08:03] Basu Ratnam:
Um, so my dad is from Hyderabad, which is in the South. Yep. My mom is from Calcutta, which is in the Northeast. And so she eats Bengali food. He eats kind of Andhran food, it's called, and so they're, they're very, very different cuisines, they're both, you know, I guess every region in India is a very food focused cuisine and culture, but my mom learned to cook both North and South Indian food to make her in laws happy, to kind of retain her family stories, so she really could cook anything, and she would cook three meals a day for my dad, and she would cook So, yeah.
[00:08:33]
So, yeah. Three separate meals for me and my sister. So yeah, so she was always just in the kitchen making food and she had a full time job.
[00:08:41] Josh Sharkey:
So wait, did she make you all like
[00:08:42] Basu Ratnam:
So we ate American food My dad would eat Indian food and then by the time we were in our like teens started sort of melding together
[00:08:49] Josh Sharkey:
Where did she buy all her like spices and things?
[00:08:52] Basu Ratnam:
It's a good question. I mean she would bring whenever she went to India she would come back with spices. You know, there's a place in Long Island that now is kind of a chain called Patel Brothers. Mm hmm. There was like little small Indian kind of markets now you have full supermarkets.
[00:09:06] Josh Sharkey:
Did she ever come to the Kalustyans
[00:09:08] Basu Ratnam:
No, no if she ever, if she ever If she ever walked into Kalustyans, she would, she would die of a heart attack. Really? Why? Just the prices are so crazy. Oh, yeah. You know, it's, it's like the antithesis of like, what, in her mind. I mean, that's part of the problem is that people still think Indian food and Indian spices, even Indians, believe this should be cheap, so.
[00:09:25] Josh Sharkey:
Yeah, which is, it's a battle with a lot of these types of cuisines. Totally. You know, and I, It's so, it's so funny the perception of what food should cost, like in the States, and it's, it is, a lot of it is like different ethnicities and their cuisines and also just, you know, like some of the more simple American food.
[00:09:43] Josh Sharkey:
I remember like, I had a group of restaurants called Bark Hot Dogs back in the day.
[00:09:47] Basu Ratnam:
You had one on, um, Bleeker, right?
[00:09:48] Josh Sharkey:
Yeah. Oh, cool. You know, we would make our own bratwurst with like cheddar from upstate and like, you know, heritage pigs. And it was this beautiful sausage on like a great bun, and we'd make our own relishes.
[00:09:58]
And it was, you know. Beautiful artisan thing, you know, in a paper boat, in a bun, you can't charge more than 6, 7, 8, halfs, you know, put it on a plate, slice it, you know, make that sauce like, kind of like go in a swirl, and have a smaller piece of bread on the side, and you can charge 30, and there's just like this perception for some reason of like food that's fast, fast has to be cheap, yeah, or even just food that's like simple, it's really frustrating, you know, Floyd opened a place called Bread Bar, yeah, of course, and um, By the way, just insanely good.
[00:10:33]
Some of the best food in the city. And then he opened some other, like, street food type spots. There's just that constant sort of battle of, like, price point. So, like, I remember when you opened. Yeah. Because we had an office around the corner on 22nd Street. Yeah. And I remember the line at the door. But it was very, like, different style of than how you're doing today.
It was, yeah. It was like, uh,
[00:10:53] Basu Ratnam:
Yeah, so we opened, I mean, I guess, well, you're not asking, but maybe you're thinking is like why, knowing everything you knew about Indian, why would someone open up a fast casual Indian? Yeah. Um, for those that aren't watching and just listening, I am Indian, so, you know, it felt very natural.
[00:11:11]
But first of all, I felt like a calling to the cuisine, you know, I grew up, there's a term called. ABCD, American Born Confused Desi, Desi means like person of Indian descent, and so I was very much an ABCD, I didn't sort of embrace the culture or the food and somewhere in my 20s, I just felt like a long in the connection to wanting to represent or learn more about my own heritage, my own cultural identity, became more curious about the food and the cuisine, and I just felt like there was this huge missed opportunity because I saw the way, this was like kind of in the beginning of the advent of like, When healthy eating and fast casual went mainstream when it felt like, you know, maybe we're five or six years into the farm to table movement, which in and of itself is kind of shocking that like people had to be reminded food came from farms, you know, like, yeah, that was always sort of interesting to me.
[00:12:00] Josh Sharkey:
I know, like, where else is it going?
[00:12:02] Basu Ratnam:
Okay, but, you know, healthy eating, healthy living, kind of this idea of mindfulness, yoga, taking care of your body. All these things were kind of like hitting the sort of modern zeitgeist and you started seeing Turmeric lattes and this idea of superfoods and I felt like Indian food was ripe to tell that story.
[00:12:20]
Yeah, I think we were really early when we started I didn't realize how hard it was gonna be I had the great benefit of youth like I just didn't know any better Yeah, so Indian food felt like there was no Indian brands at the time on a consumer, you know playing field And I've just felt like there was an opportunity to do something a little bit different So and it felt very organic to who I was So we tried Indian we opened as you mentioned like the first one was fast casual strictly fast casual It's like a Assembly line format.
[00:12:45]
We use the same I said, I didn't want to be like another Chipotle, but we hired a Chipotle interior designer and Chipotle, uh, kitchen designer. You know, we ended up with something that looks very much like a Chipotle. And it was really funny. I sat down a couple couple days before we opened. I sat down with Steve Ells, who was the CEO at the time, founder and CEO.
[00:13:06]
Brilliant innovator created a category. How did you get? How did I get him? Um, I was out at a dinner party that we were like engineering the operation to be scalable, blah, blah, blah, blah, blah. And he said, who's the GM going to be of your second store? And I was like, I don't know, you know, it was like completely mystified by the question.
[00:13:27]
He's like, if you're not already thinking about people planning and people development and putting your culture at the center of your company, you're never going to make it. And so that was lesson number one. And then lesson number two was like, if you're copying Chipotle. Chipotle is a 20 year old business model.
[00:13:42]
You're going to be out of business in 20 years. So, that kind of idea never left my head. And I felt like, you know, the first store was successful, but I felt like, this is before we had data around this stuff, I just felt like we were losing more customers than we should be. Because people were so unfamiliar with the cuisine, and so unfamiliar with the ingredients.
[00:14:01]
And I didn't just want to be a salad bar or a chipotle where, you know, you just had raw ingredients that were chopped up. I wanted to serve flavorful food, bright food, interesting, chef driven. And you just can't really, in my opinion, do that on an assembly line format where people are picking their own ingredients.
[00:14:15] Josh Sharkey:
Yeah, I mean, there's so many things unpacked there. If you go on a Chipotle assembly line, you know exactly what all those things are.
[00:14:23] Basu Ratnam:
I would say that the great magic about Chipotle is 90 percent of your decision has been made for you the second you walk in the door.
can add sour cream or a wrap. Those are the only two real options. Everything else tastes the same.
[00:14:34] Josh Sharkey:
Yeah. And decision fatigue is a real problem, you know, with, with not just with throughput, but just like with, you know, like consumer demand. But you know, you brought something up that I think is so like, I experienced a lot. I'm sure you probably do as well.
[00:14:47]
I think anybody with a business today experiences where like startups. And people in the startup that work with you or yourself comparing yourself to these legacy companies. Sure. Like, well, well, this is how we did it at this company. Sure. That's been around for 30 years. Sure. And this is how we operate.
[00:15:04]
This is how this department works, and this is how this thing works. And it's like one, yeah. Things are completely different. Yeah. So the obvious one, okay, sure. There's AI. Now things work faster, but also like you don't start that way. No. You know? Yeah. You evolve into this thing and if you. Try to, like, start the way that something else has evolved into, yeah, one, you know, it's not your own sort of, like, vision, and two, probably will never work.
[00:15:27]
I think that gets missed so often, and it's tough, because we also, like, as business owners, we compare ourselves to incumbents, because you have to. But it's like, it's really hard to not do this, but, like, there are practices. Most of them won't work for us because like, you know, like Danny Meyer has a great saying that like, you know, never think about like opening the second restaurant until people, you know, are knocking down your door to come to the first one. You know, the first thing you need is demand. Then you can figure out how to scale
[00:15:54]
And that's true with any, anything, you know, like first figure out like, do people love this product at all? Totally. And, and is there enough of it that like it's worth scaling? Clearly that happened here.
[00:16:04] Basu Ratnam:
Yeah.
[00:16:04] Josh Sharkey:
So I don't know when you swapped format from assembly line to the, to the ordering, but like, what was the. What was like the, the impetus for the catalyst for like, let's open store number two?
[00:16:15] Basu Ratnam:
I'm going to speak on both sides of my mouth because on the one hand, I always agreed with that concept that, you know, and I think I understood intuitively that fast food was a people business, you know, reminders from people like Steve Ells in that conversation, but I kind of always really believe that you had to earn the right to open your second or third or fourth and that, you know, treating everything like a concept is, is that's meant to scale is like the first way to.
[00:16:42]
Turn off consumers and also, you know, you lose a lot of the, the integrity and the soul of what you're doing. So we opened our first one in end of 2015, early 2016. We opened our second one in 2018. So it actually took us a while to get our second one open by fast casual standards. You know, we were profitable.
[00:16:58]
We thought we understood the business. I had a good team in place and the flip side of it as much as we took our time. I never wanted to be a single unit operator. I didn't want to open a restaurant. It wasn't a project for me. I wanted to build a business. I had aspirations to build a brand. I thought the restaurant business was an incredibly wonderful and rewarding and honorable place to like spend a lot of time and build something.
[00:17:22]
But it was always in my mind a company before it was a restaurant. So I wanted to not take any shortcuts. But at the same time, I always had an eye towards trying to make something that would really change the way fundamentally people thought about Indian food.
[00:17:35] Josh Sharkey:
Well, I think for anybody that doesn't understand the, the, like this type of model, a fast casual model of any kind, it only works at scale because the top line you can do it in one store, right?
[00:17:46]
You have a low price point. If you have high volume, like the union economics work, like when you have, you know, after the first store, you have to invest in buckets. Otherwise it doesn't really, you have to know that you can actually open up two or three more. Otherwise. You know, you're just kind of like working for the, you know,
[00:18:03] Basu Ratnam:
No, I, for the landlord. I mean, forget about unit economics. You also have a different sort of issue where to in this day and age to open multiple restaurants, you need a head of training, a head of IT, you need marketing, you need someone who's just someone full time, basically just looking at third party delivery, you know, it's like we have 20 software providers that Coming between us and our customer.
[00:18:27]
So it's like, it's, you're always out in front with corporate resources. And so you need to open the stores to pay off the expanded corporate team. And it's just like a chicken and egg thing for a really long time.
[00:18:40] Josh Sharkey:
Yeah. So your second store came a few years later. Yeah. When did this new, So I remember INDAY when it opened and there was like very, very similar Chipotle assembly line.
[00:18:49]
I'll take this base. I'll take these things. I'll take this cauliflower. I'll put the sauce on. It was good. It was really good. I remember. But then at some point you change to this new model where you're basically
[00:18:59] Basu Ratnam:
Our second one we removed. We built the serve line and then we put frosted glass up so you couldn't see what was on the line. But you walked down the line. So you had to place your order at the line and then you just like tortured yourself through the end.
[00:19:11] Josh Sharkey:
Baby steps.
[00:19:12] Basu Ratnam:
It was baby steps. And honestly, it was like this, like one foot in one foot out, like I had some conviction that this was the right way to build a business where you had to order with a cut with a with a hospitality specialist or cashier that was gonna guide you through the ordering process and then you picked up your meal at the end of the line, but I thought, you know, we spent a lot of money on the space, if it doesn't work and people don't adapt to the serve line model, to this service model, I'll have to put a new glass and then just run it like a Chipotle-esque, because we knew that worked at our first store.
[00:19:42]
Yeah, you were hedging a bet. What's that? Hedging yeah, for sure we hedged, which I honestly, I don't begrudge myself for, and that's, by the way, the second store was bigger than the first store. Yeah. And then the third store was busier than the second store. And then, um, by that time, it was 2019. We had raised our first, like, real round of capital from a big, you know, family office.
[00:20:02]
And we thought we were going to, like, we'd had three, it was profitable. We felt pretty good about where we sat. There was no one else doing what we were doing. We'd grown in our minds pretty slowly, you know, three and three years was like, we took our time, we were patient. And then we'd raised a bunch of money ready to like open five and then two months later, pandemic hit.
[00:20:24]
So I almost look at our business in two ways. It's like before the pandemic and after the pandemic, it felt like we started a new company.
[00:20:32] Josh Sharkey:
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Visit www.getmeez.com. That's G E T M E E Z. com to learn more and check out the show notes moving forward because we're going to be adding promotions and discount codes so that all of you lovely and brilliant meez podcast listeners get a sweet deal on meez. Man, I gotta be honest. From the outside looking in, I've only sort of seen your business grow from visiting it over the years and seeing the changes, but it seems like a lot of resiliency to get where you are today because, yeah, you changed the model a couple of times.
[00:21:55] Josh Sharkey:
This model, by the way, generally speaking, fast casual in New York City is just freaking hard. Like you have so much competition. Yeah. You have COVID, uh, it's Indian food, which, you know, if you talk about frequency, I'm sure that's a battle to get over. Like, how do you, like, manage all the, um, stress of, like,
[00:22:13] Basu Ratnam:
This, uh, it's a good question. I think about it every day. I would say therapy. How often do you therapy? Uh, once a week, started about a year ago. It's good. And certainly helpful. I have great family support. My wife is a wonderful partner and really believes in what we're doing, which helps. And so she's like often the person that is the first to tell me that you got to kind of look inward.
[00:22:38]
And if you believe in what you're doing and you love the product and you love your team, like might take longer than you want, but you're going to figure it out. You can't keep comparing yourself to other people. Yeah. So that's something I need constant reminder of. And yeah, you know, honestly, at the end of the day, I think there was definitely moments during the pandemic where I was like, you know, maybe this is it.
[00:22:56]
Maybe we tried our best. I've been at this five years. Like let's, there's gotta be easier ways to make money. And. I started looking around and you know, the CPG companies that raised 10 million off of 200,000 of revenue. And a lot of the tech startups and a lot of this, that, whatever, like nothing seemed easy, felt like gravity was coming for everyone, you know, that interest rates went up and you're seeing it what's happening.
[00:23:19]
It's just, I think anything worth pursuing today is hard. I'm sure your business is hard, you know, I'm sure restaurant tech and SAS and all this shit. It's like, I'm not resigned to doing it because everything is difficult, but I think The humbling experience has made it just really clear to me that anything worth doing and pursuing is, is, it doesn't move in a straight line and no one deserves, no one's owed anything, you know, you got to go, you got to go build it.
[00:23:45] Josh Sharkey:
I feel like we talk about this a lot on this show, just by, by, with my friends, business doesn't get easier. It gets harder over time. And anybody from the outside in, and we all do this, right? Yeah. We look at our friend's business, be like, I should do that business. Yeah, totally. So much easier. There's less complexity.
[00:24:00]
Totally. Every business is. Fuckin hard. Every bit of this is hard. You know, and it doesn't get easier. And the only thing that matters is that you know why you're doing this. Yeah. Because no matter what, Yeah, you gotta be in touch with your wife. Every month, someone's gonna pop, like, pop up, and be like, okay, we're like, if you don't really, really want to do this, and you're not really clear as to why, Give up.
[00:24:20] Basu Ratnam:
Yeah, for sure,
[00:24:21] Josh Sharkey:
You know, so like I think I know this could be talked about it Yeah, I know I can sort of like ascertain that you want to sort of like, you know, introduce Indian food Yeah, but is there a bigger why as to why INDAY exists?
[00:24:34] Basu Ratnam:
You know, I think that's part of it. I think I feel this, I feel compelled.
I love food. First of all, I love food. I love being around food. I love the cooking food, the making food. And I tell people every day now, just loving food is not enough to get into the restaurant business. Just be a great customer, tip well, come back often. But food brings me a lot of joy. Uh, it always has.
[00:24:54]
I think it's like a love language for me. I cook for my family, my friends, when I'm feeling stressed, you know, it's just something I like to do. Um, I love Indian food because I feel it helps connect sort of the story of who I am. Our corporate sort of company daily motto is, “Good Karma Served Daily”. For me, that's like a way of life.
[00:25:13]
And it's something that I think about. All the time. And it feels like if I can leave that impact on one person a day, like that's a, that's a life worth living. It's a company worth building. I'm sure when you walked in, you saw the teams like outside meditating and stretching, you know, that's like, we've built in all these daily rituals.
[00:25:28]
It's cool. I actually didn't realize that. Oh yeah. That's awesome. You saw them outside.
[00:25:33] Josh Sharkey:
I saw them outside. I didn't really realize.
[00:25:35] Basu Ratnam:
She's lighting incense right now. It's just, you know, we built in these daily little reminders that you, you know, your, your day begins within you are. You are your thoughts, you're your actions.
[00:25:46]
And, uh, if we can leave things a little bit more positive, a little bit more connected, a little bit more peaceful than where we left them, they were where we started. That's a, that's a life worth living. So I'd say that these, these behaviors have picked up a life of their own. I, we don't tell our teams to do that anymore.
[00:26:02]
We showed them how to do it and we said, if it works for you, keep doing it. And now they do it in the restaurants and it. It feels really special and humbling to be a part of that. In some ways it's about the food, in some ways running a company like this feels bigger than the food.
[00:26:15] Josh Sharkey:
And it is, right? I'm sure the services as well and all these things are part of the product. Yeah, I find more and more as I get older. Cause I, you know, I'll be honest, when I started restaurants, I was 28 when I started my first, when I opened my first restaurant. Like, I didn't think about it, I didn't realize. Oh yeah, the people are everything. That's actually your business. And not just that, but like finding people that believe the same thing that you believe, or at least sort of like, like, you know, injecting that in them where they're like, holy shit, I, that's awesome.
[00:26:46]
I want to do that too. Yeah. It's really like everything. I'm just seeing more and more like for us, like we, you know, um, I started my company because I, I mean, I, the idea for me was many years ago, we launched to the public in 2021. We did this thing during COVID, we were supposed to launch during COVID and instead we gave, we basically gave it away to chefs and let them sell their recipes to their customers and friends.
[00:27:12]
And they just helped them generate, you know, thousands of dollars for themselves and their business because they didn't have a restaurant. But, um, you know, I started it because like, I, I see so many restaurants that close. Where the person that started it is smart and talented and works their ass off.
[00:27:30]
And it drives me nuts and it breaks my heart. And, you know, meez for me, like my company is, is exists to help people scale their vision and really just allow you to be creative and profitable. Because those two things typically are like at odds and that sucks. And that's, you know, so like for me every day, like.
[00:27:52]
Like, this has to, like, this has to work because all of my friends, you know, are at, are using it and, and, and, and friends of friends and friends of friends of friends and like having something where you, like, you feel like this deep, like, almost obligation, like to fulfill the vision, helps to like keep, keep it going and making sure no matter what, like, it's maniacal about like, driving it forward.
[00:28:17]
I wish, to be honest, that I had a more holistic, softer sort of vision that you, that you have of just like, you know, having, giving good karma and starting the day right. That's one thing that I struggle with. And I'm curious how you integrate that into your, your day to day, because you run a business that has multiple locations.
[00:28:34]
You now acquired another company, you know, you're, you've now helped your staff to like Do yoga in the morning and incense, but like what about
you personally? Yeah, how do you like do that in your life?
[00:28:45] Basu Ratnam:
It's hard. One of our core values is begin within and so the idea is that you are in control of your thoughts of your emotions of your actions ultimately and so for me It's about finding a pocket of time in the morning that I can carve out for myself set my intention for the day, try to move my body a little bit, try to meditate, breathing exercise.
[00:29:07]
And it's not always perfect. And I think that's part of, like being, being in this like forward momentum is that you understand that perfection doesn't exist, but you gotta, you got to set the time. Yeah. And I read something, someone said, if you don't have 10 minutes for yourself every day, you really need to take two months off and reevaluate.
[00:29:25]
And so, you know, I think there's all sorts of incredible tools now, meditate, five minute meditations. Two minute breathing exercises, there's countless studies on the impact of journaling and gratitude exercises And I just you do it until it sticks and it becomes a habit And it's something that feels good and you look forward to do it.
[00:29:42]
So for me, it's carving out time being intentional about that It's harder. I have two kids under two or a two year old and just turned two last week and a one year old
[00:29:50] Josh Sharkey:
So you're a two year old just turned two.
[00:29:51] Basu Ratnam: Yeah Yeah.
[00:29:52] Josh Sharkey:
Congrats, man. I have a three and a five year old. Okay.
[00:29:54] Basu Ratnam:
Yeah. So my two year old turned two, two weeks ago, and we have a one year old turning one.
[00:29:59]
Oh, so you're in the weeds. Yeah, we're in the weeds. So it's, you know, it becomes harder. And if I want to, I want to do stuff, I got to wake up before them, which is hard. Kids woke up at five this morning. Um, but yeah, I think it's, it's just setting the intention. Understanding that you got to take care of yourself first in order to show up for, for the people around you.
[00:30:16]
And I'm not perfect at it. My partner and my wife would say there's plenty of days where I'm preoccupied, but it's, you know, it's a constant. Yeah,
[00:30:23] Josh Sharkey:
We have these sort of intentions of like, you know, being good to others and being understanding and not judging. It's the hardest to do it to yourself. Totally.
[00:30:30]
I'm the same. I try to always find time to exercise. I journal every night. But there are nights that I miss it. Sure. And it used to be that I would just be so angry with myself. Yeah. And I would like Judge myself like oh, you know, and I think the most I think the key for any for anyone whether it's exercise or meditation Or whatever.
[00:30:49]
It's just like Stop judging yourself. Stop judging yourself. You know, you might miss a week. Totally. That's actually what meditation is. Yeah. Breathing, you lose your focus, go back to it. Exactly. And like, you exercise, you miss a day, do the next day. Totally. But I feel like that's the hardest thing.
[00:31:03] Basu Ratnam:
But that's my, that's mindfulness, right? Is to know where your energy and thoughts are going and recognize that they're happening and try to call your attention to something that feels a little bit more, um, centered.
[00:31:16] Josh Sharkey:
Yeah.
[00:31:16] Basu Ratnam:
You know, I was just reading a study that said the top three things, and I think it was a Harvard Business school, like case study or whatever.
[00:31:23]
They did this like big longitudinal report. What are the three things people regret at the end of their life? Number three was they wish they kept in touch with their friends more. Number two is they wish they chose a life for themselves as opposed to letting their family or their jobs dictate their choices.
[00:31:39]
But number one clearly was having less regrets, which they actually defined as not the action. But your reaction to the action, so it's not that you regret missing the meditation or the workout, but it's the time you spend kicking yourself for doing it that people respect. And so I think that earlier you can realize that that, recognize that you do it while you're doing it, but try to turn your attention to the present. Yeah. I think that's It's so hard. It's very hard.
[00:32:05] Josh Sharkey:
But I think, it seems exciting about a business like this, is that if you can help people, just remind them. If everybody around you is reminding you like, Hey man, it's okay, you missed it. That's a lot more helpful than just you in isolation. You know, so that seems like a pretty, you know, pretty incredible sort of part of what you're of what you're building here.
[00:32:22] Basu Ratnam:
Yeah. Um, No, I think we, um, just the last thing, I don't I don't want to seem like we're just selling our values all day, but one of our other values are make magic moments, which, you know, to me, magic is taking this humblest, simplest thing and turning it into something that makes you feel so special or make someone else feel so special.
[00:32:39]
And so we try to infuse that into our daily culture. We celebrate the magic moments. We talk about them. We give awards out to the manager who can collect the most. And so if you have a team where you're always kind of thinking about how do you turn something ordinary into something special? Doesn't take much.
[00:32:55] Josh Sharkey:
Yeah. How does that manifest itself? Like, are there things you can think of that have happened?
[00:32:59] Basu Ratnam:
In our restaurant? Oh, yeah. I mean, it can be big moments of hospitality. You know, it can be, there was an example the other day where someone wanted lemonade, but, you know, didn't, we use, um, Coconut nectar as a sweetener, and she's allergic to coconuts, so they went to the back, remade the lemonade on the fly during a busy lunch service, ran out the door, handed it to the customer, who was totally stunned, you know, so that's a huge make magic moment, but it can be something little, it's remembering a teammate's birthday, it could be covering for someone, you know, covering a shift when, when there's a call out, it can be like, I don't even, I don't buy these flowers anymore, I bought them for the store when we opened because I thought it'd be a nice touch.
[00:33:38]
There's nowhere in the SOP that it says, go buy, buy these flowers. But the GM decided she loves them. She uses her own money, goes to the little bodega. And like every day that I see the new flowers, I'm like, wow, that's, that's a magical moment. Yeah. She's taking the time to do it.
[00:33:52] Josh Sharkey:
I love that. So you, so it sounds like they have a lot of empowerment to kind of.
[00:33:55] Basu Ratnam:
Yeah. I mean, to a certain extent, yes. I mean, we, you know, we are always trying to find the balance between the systems and the creativity. To your point, we say, you know, that there are some operational standards in the restaurant. Our stores always have to look. Wow. We call it, you know, to walk in and be like, oh, wow.
[00:34:11]
Someone's paying attention here.
[00:34:12] Josh Sharkey:
Yeah,
[00:34:13] Basu Ratnam:
We don't always define what that is. There's nothing that says you have to light incense. There has to be flowers on the table. Um, but it has to be clean. It has to be bright. The music has to be energetic. We want people to remember that there is good karma. And so we let our managers figure that out.
[00:34:27]
We give them, you know, we're always there. We give them tools. We try to be super hands on when they want us to, but we don't micromanage it.
[00:34:34] Josh Sharkey:
Yeah. You know, that's so hard to do, but the only way that you can really scale the right way, you know, is. Yeah, just having first principles that you can give to them and say, here's the result we're looking for, here's our first principles, go have at it, you know.
[00:34:48]
It does mean, like, sort of relinquishing control, but it, It, it really, it is cool how, you know, you can see the magic happen with each, with each GM. How many stores do you have now?
[00:34:56] Basu Ratnam:
We have ten.
[00:34:57] Josh Sharkey:
Jeez. Alright, so, uh, I'm super curious about this, the acquisition. Yeah. Do you mind if we talk about that? Sure, sure. Because you recently acquired, uh, Beatnic. Yeah. Formerly known as, By Chloe. Formerly known. First of all, like, did that come across your desk? Yeah. Or was it like, oh, okay. So yeah,
[00:35:12] Basu Ratnam:
So how'd it happen? So we had a small investor that was a larger investor in Beatnic, the company formerly known as By Chloe, and they originally pitched it to us about two years ago as a merger opportunity.
[00:35:23]
And there was, I think, a lot of interest in the market at this time when you had subscale brands, like sub 15 unit, 20 unit brands that were looking to grow. Capital had sort of dried up. And as we mentioned earlier in the podcast, We all have corporate infrastructure, whether we want it or not, you know, you need people focused on all these non, what you would think of as non core things just to just to be in business today, you know, there's a lot more stuff that you need to be aware of.
[00:35:51]
And so there was a popular idea that said, why don't you Take these two, take two brands that combine the EBITDAs of the companies to consolidate some of the corporate GNA and you have a more financeable company. So that was, it was pitched to us in that, in that manner. I looked at the numbers, I looked at the business, it was bigger than us.
[00:36:10]
Uh, so that's why it was kind of a merger. Our numbers were going one way, their numbers were going the other way. The thinking was, you know, you can run both and there's synergies and, uh, you can kind of co locate and share customers and marketing database and all that kind of stuff. I just, everything I just told you about why I keep doing INDAY does not apply to other brands.
[00:36:33] Josh Sharkey:
Yeah.
[00:36:34] Basu Ratnam:
I thought I, I entertained it for a second, but I just have no The thing that gets me out of bed, the thing that gets me caring about the, the smallest detail of our business, it just, I tried the thought exercise of trying to do that for another company, not just Beatnic, but any other company. I just don't have it.
[00:36:48]
And so we ended up making an offer to them to buy the company, even though we were much smaller than they were at the time. That offer was rejected. And a few months later, they came back and they said, you know, we'll take another look at this. And we got a deal done.
[00:37:00] Josh Sharkey:
Was it a merger or was it like an acquisition?
[00:37:03] Basu Ratnam:
We acquired them and we gave them, we didn't have the cash to pay what they thought the full value was. So we gave them a very small piece of our ongoing equity for the combined business.
[00:37:11] Josh Sharkey:
Did you finance that acquisition?
[00:37:13] Basu Ratnam:
Yeah. Gotcha. It was an inside round. We had a couple of investors that saw the broader opportunity and felt like we were undersized relative to our potential, mostly because COVID sort of halted all new store growth.
[00:37:24]
And I, ultimately they asked, Me, if I believed it, and I did, I believed that we could be a, we could go from five to ten and we could take on their team. I loved, I loved, loved, loved the corporate infrastructure that Beatnic had built, the people. We didn't let go a single person at the corporate level.
[00:37:40]
Almost every GM that we have in the acquired Beatnik restaurants are Beatnic employees. I think we kept on probably 80 percent of their, their team. Wow. So it, it was a merger in some sense, but we're going forward under the in date name.
[00:37:54]
But that's impressive because obviously when you look at those types of deals, there's like, you're appreciating, like, you know, overhead decrease and
[00:38:01] Basu Ratnam:
Totally. Um, and, and now six months in, we've, we've definitely made some adjustments. We were, we had too big of a team for what we needed, but we had to take the time to figure it out. Yeah. It was pretty remarkable. There was basically a one for one addition. If I was building an org chart, I would have hired for the positions of Beatnic head versus what we already had.
[00:38:20]
That's great. And their store. I mean, there's a lot of things that made it make sense. We were on the same POS. Yeah. We use the same backend delivery providers, all the same software. Uh, we used meez and R365 at the time they did as well.
[00:38:33] Josh Sharkey:
And they also have the same. Format, which is interesting. Exactly, same format. The, uh, Order ahead. Order, but there's some, there's some optionality to the order, you know.
[00:38:41] Basu Ratnam:
So same format, same hood sizes, same allocation of back of house, uh, to front of house. It was like, you know, we were co located. There's only one store that we didn't want to take because of location. So it, it just made a lot of sense.
[00:38:55]
It made a lot, a lot of sense for us. And it got us to a store base that I think is at a different level, you know, puts us in a slightly different place in the market.
[00:39:02] Josh Sharkey:
What was the most surprising thing about that? That, I mean, it's the first time you acquired a company. What was the most surprising thing about that?
[00:39:08]
Like if you had to tell yourself today, like how to. Manage that transaction now, is there anything you would change?
[00:39:15] Basu Ratnam:
All the stuff that I mentioned about the people, the real estate, the like speed of development, the cost of the renovations, because they were similar store formats, all that stuff has been absolutely true.
[00:39:26]
We've gotten that almost 100 percent right and I'm really proud of it. The most difficult part I think, and I don't know if this is an acquisition issue or a post merger integration issue, but we underwrote a lot of operational efficiencies. Because we thought we could apply, you know, certain margin structures from what Beatnic did, or even commission structures, which are negotiated with third party vendors.
[00:39:46]
Uh, food costs, because we, we'd set a theoretical food cost in me's. Um, achieving those has been much, much harder. Yeah. Uh, and it's not because we're mismanaging the business. It's just like, it's harder to go from five to ten and be as precise. Yeah. As, as you think you can be, even if you see the numbers on paper.
[00:40:02]
Yeah. Um, so I'd say that part has taken, it's going to take twice as long as I would have thought.
[00:40:07] Josh Sharkey:
Yeah. Got it. So, getting to the, uh,
[00:40:13] Basu Ratnam:
Sort of like the operational efficiencies are harder to realize and actualize. Yeah.
[00:40:16] Josh Sharkey:
I imagine at some point you might be looking at other acquisitions.
[00:40:21] Basu Ratnam:
Yeah, I think it's an interesting way. And by the way, we, we got the idea from a completely different scale, but the Cava, Uh, Yeah. Yeah. Yeah. So
[00:40:28] Josh Sharkey:
Would you now, like, consider underwriting these businesses differently just based on that? Factoring that in.
[00:40:35] Basu Ratnam:
Yeah. I'd probably underwrite it a little differently. I'd, I'd probably raise a little bit more money to get things done and hopefully we'd get better at it.
[00:40:41]
But look, if you're buying a company at one times EBITDA and you think the market will value the pro forma at 10, there's a ton of upside. Not every good acquisition opportunity is a good business opportunity. Um, so I think we would be extremely selective about doing it again, but I do think it's a really fascinating way to grow. Um, Yeah,
[00:40:59] Josh Sharkey:
It is really interesting that those efficiencies are sort of the same way as if you open a second store. I remember whenever we would open another store, we always factored in a ramp down of whatever our
[00:41:09] Basu Ratnam:
Food cost. Whatever our margins were,
[00:41:11] Josh Sharkey:
Both labor and food cost, we would mark up by 20 percent and then ramp that down over the course of six months.
[00:41:17]
Because you're just figuring stuff out. It's a new store, different hours, different, like, and we always went over anyways. Like, it was always worse than what the ramp down was. But there's, yeah, there's no way of getting around that.
[00:41:29] Basu Ratnam:
Yeah, I mean, I guess that's the lesson, because it's funny, and not to get too much into the Beatnic side of things, but they ran that business so tight.
You know, they knew to the portion what the theoretical variance between food actual and, and what their supposed food costs would be. And we just thought we could apply that. Yeah. Can't. Yeah. People business, people error, human error. Yeah. Just, it takes time. Yeah. It takes time to get things. Yeah. Dialed in.
[00:41:54] Josh Sharkey:
In my opinion. The theoretical food cost is really the only real way you can impact the profit of your business from a menu standpoint, because you're basically just trying to move the margins with the same delta. So assume that the delta between the actual food cost and theoretical will always be 3%, 2%, whatever it is.
[00:42:15]
So can we reduce our theoretical costs by 1%? Assuming everything will continue to over portion waste and screw things up, because then everything else is just gravy, right? If you can figure out how to like, not burn, you know, batches and not portion, then, you know, you're just gonna get, you know, more out of it.
[00:42:34]
The only way you know for sure, I just say, I just generated another X amount is by lowering the theoretical. Lowering the theoretical, yeah,
[00:42:41] Basu Ratnam:
No, I think that's right. I mean, we um, Just to crystallize the example without getting too technical, we were running a 300 basis point spread. Beatnic was running 150, so we thought we could underwrite 200.
[00:42:52]
Yeah. We're at, we started at 700. Yeah. You know, the combined entity, and now we're working our way down back to like 300. Yeah, which makes sense. Just happens. Yeah. So, you know, I I, to your point, the numbers will tell you one thing and the operations are a whole other thing. And you just, it takes time. Yeah, takes time.
[00:43:10] Josh Sharkey:
So what, like keeps you up most at night?
[00:43:12] Basu Ratnam:
Right now we, you know, our, we grew so quickly and operationally, actually, you know, the stuff I'm saying on the back end, the food costs. food quality. That doesn't scare me because I know, I know we can fix it. And actually, I'm really proud of the product. I'm proud of the culture that we built in the restaurants.
[00:43:28]
They feel like in days, in my opinion, even, you know, this is our restaurant's only been open two months, but it feels like the way I want it to the people. When I walk in, the people are doing the things that, that to me make the restaurant special. So it's not the operations that scare me, which is a good thing.
[00:43:41]
Cause I think that'd be a lot harder thing to fix. I think that the thing that keeps us up at night is our business grew so rapidly. We almost haven't had a chance for the brand to catch up and historically have not been a good at being out in front of of our company with the brand, I think is very counterintuitive to a lot of companies run today, which is the brand is much bigger than the business.
[00:44:04]
You know, you see these. D to C companies, these Instagram based businesses, and you're like, they're everywhere. And then you see the actual PNLs and it's like, you know, they're doing whatever they're doing in revenue. We're the opposite. You know, we're a pretty big business now with, uh, much smaller. Brand footprint and kind of name recognition that just makes opening restaurants harder than it needs to be and so My big focus for the remainder of the year and probably all the way through next year is Getting the brand out in front of the business.
[00:44:32]
So because you know Indian food It's not a natural thing for people to walk into.
[00:44:35] Josh Sharkey:
Yeah,
[00:44:36] Basu Ratnam:
You know, they don't we noticed, we opened new stores and they could look beautiful. It's a beautiful looking store, the food's amazing. Um, people are still like, what's Indian food? Where's the serve line? You know, how, how, how long is it going to take?
[00:44:47] Josh Sharkey:
Yeah, am I going to leave smelling bad? Now people are so used to the line. Yeah. That when you walk into a place, Without a line. That's casual. And there's no like, assembly line. You're like, what, what's going to happen here? Yeah. Like, I'm not actually sure what I do I do? Yeah. I had, I had a Korean spot the other day, Uh, near our, near our office and it was that concept, right?
[00:45:09]
And you just order and then it comes out and it was awesome, by the way, but I was like, I don't, is this going to take an hour? It's 20 minutes. It's like, what am I going to get? Um, so it is a new, uh, a new premise.
[00:45:19] Basu Ratnam:
Um, it isn't, it isn't, you know, I, I always remind myself that fast food started this way. You order a counter, you wait five minutes, your food comes out.
[00:45:27]
Yeah. Um, but to your point, lunch, healthy, premium lunch options have been dominated by the assembly line. It’s been an arc.
[00:45:35] Josh Sharkey:
It was that way. Then it wasn't, and now it is again. So how are you going to do that? How are you going to get the word out? Like, what's your, like, But are you thinking like strategically or tactically, like what are the, what are the, yeah, I mean, I
[00:45:45] Basu Ratnam:
I think it's going to be a combination of like, I'm not a natural marketer.
It's something that comes much more difficultly to me, but yeah, it's a combination of like top of the funnel, like awareness campaigns that we got to do, whether it's on social and sort of more broader advertising, I think some of it's going to be activations and influencer. Kind of relationships and partnership stuff that we've got lined up for the fall.
[00:46:07]
Um, At the end of the day, I think the best marketing, and I always tell my team that, is word of mouth. You know, delivering at a really, really high level in the restaurants. I feel like we see the growth, uh, already in that. But yeah, it's a combination of just, just making Indian food feel a little bit more fun, a little bit more accessible for people that, that hold on to these stigmas about it.
[00:46:26] Josh Sharkey:
What's your, what's your day to day like right now? I imagine it's changed. Yeah,
[00:46:30] Basu Ratnam:
It's changed. I actually, you know, it hasn't changed too much. I spend a lot of time in numbers and the weeds, which I think I'm trying to get myself out of, you know, we finally have a fuller org chart where we have like a finance role.
[00:46:44]
We have a people, you know, a couple of people on the upside. We have a You know, uh, as I mentioned, this kind of third party catering role. So I, now I spend more time with my teams and trying to make sure they understand what the kind of quarterly and monthly objectives are. We try to be pretty KPI driven.
[00:46:59]
Cause I think that that helps. I think the way to get someone to do the work you want them to do is make it the easiest thing for them to do and the easiest thing for them to understand. So I try to spend a lot of time making sure we're clearly articulating what the, what the objectives for the business are.
[00:47:12]
So I'd say that's a big piece of it. Um, I'm in the restaurants. Not as much as I should be, but, but fairly often, and we're getting back, you know, in the next couple of months we're going to be getting back on the, on the train to start looking at new leases and signing new leases and having to think about raising more money, so just getting prepared for that portion of it.
[00:47:34]
What makes you, like, blood boiling angry? I would say, there's a couple things. I think, And you mean in the business, right? Not in life? No, anything. Just generally. Uh, I don't get that angry that often, for better or worse. But I'd say on the, in the business, there's this perception, and I, and I don't blame people for it, because I think it's somewhat out of their control, that food is, that, uh, It has to be fast, cheap, and good.
[00:47:59]
And I think all three of those things can't be true at the same time. Food is hard. Good food is even harder. Uh, and it takes time. If you're making it with love, you're making it from scratch. And, uh, it's just, we've become conditioned in this world of like instant gratification. Everything is quick.
[00:48:16]
Everything is the same. Everything is exactly as advertised on TV or on Instagram. And people's tolerance has just gotten, it's gotten crazy. You know, I find the reviews. Or the, you know, customer feedback that we'll get sometimes. It's just like, I can't imagine that someone took the time to write this down and, and, and place these demands on the place that they got lunch, you know, I'd say that's one thing.
[00:48:37]
And the second thing is, and I'm a lifelong Democrat and, you know, forever New Yorker, I think, but I just find that it's gotten Hmm. So much harder to do business in the city, uh, on every, every level and the closer I get to administrations, you know, within, you know, dealing with a specific issue or specific, um, department, the more I'm terrified of, of, of how cities get run.
[00:49:05]
Yeah, man. It's a big one, but, but it's just something's got to change.
[00:49:10] Josh Sharkey:
Yeah, to the first thing you said, like just that perception of either what food should cost or what, you know, I mean, there's that old parable, you know. There's fast, cheap, and good. You can pick two of the three. You can pick two of the three, right.
[00:49:20]
That's it. But that somehow got lost. But also just generally, forgetting the fast, like, I think what the perception of what food should cost. It's completely out of whack in my opinion because they, you know, you look at it like well I can go to the grocery store and buy this thing.
[00:49:34] Basu Ratnam:
Yeah, but but go to the grocery store right now
[00:49:37] Josh Sharkey:
Yeah, well number one, you know, it's more expensive the grocery store number two You have to buy you know enough for a hundred people when
you do that.
[00:49:44] Basu Ratnam:
Yeah,
[00:49:44] Josh Sharkey:
And then you have to store the rest of that food and someone has to like Prepare that food for you. Yeah, and then someone has to clean it up. Yeah, so I said choose the right like like ambience for you to be in Choose some nice music and a nice place for you to sit and like some plates that you can throw away Yeah, like all that all this money all and the food is just like one small part of it one of the small things and I yeah, I yeah, I think because People eat out way more than they ever have that that perception has, has been slowly shifting.
[00:50:18]
It's the frog boiling in water and it's tough, man. And, and like, I feel like that water is almost boiling.
[00:50:23] Basu Ratnam:
Yeah. And I, you know, as a diner, I, I understand some of the, the, the frustrations feel like in the city, there was this deserved feeling of gratitude and compassion for restauranteurs, especially during the COVID, during COVID when people stayed open.
[00:50:40]
And I think a lot of restaurants kind of. made more money in those few years than they'd ever had before. You know, jacked up prices, leaned their staff out, built, you know, sidewalk sheds. And most of it was really incredible and admirable. But then the prices stayed up. You know, supply chain disruptions came down.
[00:50:56]
Our input prices came down. The prices didn't change. And on the one hand, you can argue just keeping up with kind of all the inflationary measures and that with restaurants had historically maybe been underpriced because you see all the reports that margins keep going down. But it does feel like as a diner that there are a certain, a lot of restaurants that, that have taken advantage of that and maybe sustained kind of pricing in a place that doesn't totally feel fair considering we are a city of people who eat out all the time, but there's gotta be balances.
[00:51:26] Josh Sharkey:
It's tough because yeah, it's almost like the price is normalized to what they should be. The inclination is like, well, let's go back to what it was, but the margins have always been, you know, raised with it, you know, and, and the problem is, I think that it's easy to sort of just look at, you know, objectively like, Hey, this thing should cost 10.
[00:51:46]
But if you ask the same. You know, people in aggregate, do you want my team to have health insurance? Right. Do you want them to have a day off? Yeah. You know, do you want them to be able to, you know, like, they'd probably say, yeah, I'd love that. Okay, well then, this needs to be an 18 roll, not a 14 roll. Right.
[00:52:01]
Um, but that is a tough, you know, It's a tough thing,
[00:52:04] Basu Ratnam:
Yeah.
[00:52:04] Josh Sharkey:
You know, it really is.
[00:52:05] Basu Ratnam:
People, yeah, people are not good at, Making sacrifices for a kind of vague idea. Yes,
[00:52:13] Josh Sharkey:
And it's just, there is a bit of that here in OEVLC, you know, I mean, we, we wear clothes and shoes and things that cost way less because they were made overseas or for whatever reason.
[00:52:23]
And And at the same time we might complain about taxes, which I do too. We make a lot of decisions with our, with our dollar, you know, but it's very hard because a lot of it is, you know, let's just say, I don't want to, like, use plastics anymore. Good luck, they're in everything, you know, so some things we're kind of stuck, but I do think that you can be a little bit more discerning with restaurants.
[00:52:44] Basu Ratnam:
Yeah. Decide to go to places because you believe that. Yeah. You support the values. And I think we, you know, we, um, you gave your example of a bark and, and I think you're talking about like this perception of cuisines and price, but ultimately I think it's up to the restaurateur or the business to, to validate for themselves why they charge what they do.
[00:53:02]
Ultimately, I think. People will pay if people will pay higher prices if they feel like the value is there. And I think it's up to the brand and the company and the restaurant and the operation to be able to support that over time.
[00:53:17] Josh Sharkey:
I agree. But I also think they're like, you ever read Robert Cialdini, his book called Influence.
[00:53:23]
There's these four principles of influence. And one of them is the perception, perceptual contrast. Yeah. And we make decisions based on, you know, you, you, somebody sells you a car. Yeah. For 30,000, the idea of like, uh, you know, spending another thousand dollars on an, on an upgrade for something is well, a thousand.
[00:53:42]
I've already spent 30, 000, you know, it doesn't matter, but it works the opposite way as well. And I do think it is tough. Let's just say that, you know, you have a Lamb Rogan Josh you want to put on the menu, you know, and that should cost, you know, $32, you know, because of just the products you use, how much time it takes.
[00:54:00]
But every other place in the city charges. $15. Yeah. It'd be really hard to charge 32 even if, you know,
[00:54:08] Basu Ratnam:
I agree with that.
[00:54:09] Josh Sharkey:
Just this percent, it's like a burger, you know, like burgers cost X amount when they're, you know, when you, when you order at a counter versus if you sit down. Yeah. There's a comparison that happens no matter what, even if like, I mean, we, at my restaurant, we would, we literally bought an entire steer from this organic, from, uh, Righteous Organics farm upstairs by the whole cow.
[00:54:29]
The burger was the entire cow, other than the strip loin, which we sold to the, to this butcher. It was an incredible burger. Doesn't matter, you can't charge more than, you know, $6.70 bucks. Can't. We should. Right. But we can't. And I think that's part of the, you know, partly it's just this comparison thing.
[00:54:45]
There almost has to be this collective agreement within restaurants, at least in this sector, like, hey, maybe we should all decide that this thing costs more.
[00:54:52] Basu Ratnam:
Well, you know, I, I agree with a lot of what you're saying. I think You can't suddenly increase prices 30 percent or 50 percent and expect not people not to notice, but I think you can communicate effectively why your price at the higher end Get the buy in and the trust in the storytelling down and gradually increase to where you need to get to.
[00:55:13]
Yeah, and I think a little bit we talked about, you know, in terms of
theoretical food costs, you got to know what your basis is.
[00:55:20] Josh Sharkey:
Yeah.
[00:55:21] Basu Ratnam:
And if you're selling it at $10, but it's worth $15, you got to celebrate the hell out of the fact that you're selling it at $10, you're giving the customer that, that perceived value.
[00:55:28] Josh Sharkey:
Yeah.
[00:55:28] Basu Ratnam:
And then you get the right to, you earn the right over time to charge them $15 for it. Yeah. But if you're selling it at $15, if you're selling it at $10, you think it's worth 15 and you're just complaining that you can't raise prices. Yeah. You're never going to win. Yeah.
[00:55:39] Josh Sharkey:
And the flip side also is like, if you do charge a lot more. Let's say you do charge what you should, like 15 bucks. It, sometimes it can actually just even out. Because, let's just say that 20 percent of people just don't come anymore. But the other, the people that actually believe and understand, they do come, and it actually ends up still being more revenue with less people.
[00:55:58]
Because the people that actually believe in what you're doing pay for it, so.
[00:56:02] Basu Ratnam:
Yeah, and I think it's, you know, when you do charge 15 for that, Otherwise, 10 item, the pressure is on you, then, to make sure that you're delivering a 15 experience. Yeah. And I think people forget that, too. Yeah.
[00:56:15] Josh Sharkey:
And a lot of that is also combated with service and people. Totally. 100%. You ask for something up always. There'll always be somebody that orders something, and they got the wrong thing, or it was cold, or whatever, like that, that happens.
[00:56:27] Basu Ratnam:
There's no question.
[00:56:27] Josh Sharkey:
How you handle it, making sure you have people that'll actually, like, you know, follow up, and apologize, and take care of it, Matters way more.
[00:56:34] Basu Ratnam:
Well, no, because it's what you're saying that $15 has to not just pay for the organic beef. It's got to pay for the training of the team to make sure that they know that the gasket feels taken care of.
[00:56:43] Josh Sharkey:
Yeah, yeah, 100%. We could talk for hours about this, but this was awesome. Yeah. Thank you for taking some time. Of course. And also thanks for like, turning on the music. Because we're, we're actually out, uh, in day, in, in Soho, and the music has been down, but we'll crank it back up.
[00:56:59] Basu Ratnam:
We'll crank it back up. Uh, this was awesome. This was great. I appreciate it. Yeah. For sure. Nice to, nice to hear more of your story, and I'm, the, uh, concept of, of letting people kind of scale their dreams is, is one that we take to heart.
[00:57:12] Josh Sharkey:
Me too. Alright. Cool, man. Thank you. Thanks for tuning in to The meez Podcast. The music from the show is a remix of the song Art in Error by an old friend, hip hop artist, Fresh Daily. For show notes and more, visit getmeez.com/podcast. That's G E T M E E Z. com forward slash podcast. If you enjoyed the show, I'd love it if you can share it with fellow entrepreneurs and culinary pros, and give us a five star rating wherever you listen to your podcasts.
[00:57:37]
Keep innovating, don't settle, make today a little bit better than yesterday, and remember, it's impossible for us to learn what we think we already know. See you next time.
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