Baskin Robbins eyes growth in tier-II towns

Pankaj Chaturvedi, chief executive officer, Baskin Robbins, said, "We have just one store in Jaipur but would want to open 9 more there. Our target is to open at least 100 stores every year from now.

We would support it by making investments accordingly in scaling up our plant and machinery, recruiting the right kind of people and finding the right franchisees." One of the major challenges in its growth path, however, is the escalating real estate prices in Indian cities.

Prior to 2000, the average size of its stores was 1,000 sq ft. In 2002, the company consciously adopted a strategy to compress its store size. In 2005, the average size of its store dropped to 250 sq ft. Interestingly, its strategy of going to smaller cities would enable it to have bigger stores, taking the average size of its stores to 400 sq ft.

Getting the right franchisees would also be crucial to its success as it will not market its ice cream range through the mom and pop stores. However, growth in modern retail, multiplexes and fine-dining have helped generate demand for its brand. The ice cream maker is looking at tie-ups with airlines as well.

Since Baskin Robbins imports most of its vital ingredients, such as chocolate and other flavours,the company hiked prices by 10 per cent in April on the back of a rise in commodity prices. With a turnover of nearly Rs 60 crore in FY08, the company is growing at the rate of 35 per cent a year as compared with the industry average of 12 per cent.

The ice cream chain spends 8 to 9 per cent of its revenues on advertising each year.

Baskin Robbins ice creams have often been called expensive by the consumers until its competitors entered the scene like Gelato.

When asked about how the company would tackle new competition like Gelato, Chaturvedi said: "I am happy they have entered India because till two years ago, everyone used to tell me how expensive Robbins was. Now, people seem to have accepted the price bracket as more expensive players have come."