American restaurant chain 'Thank God It's Friday' on Friday said it will open eight new outlets in India with over Rs 40 crore (Rs 400 million) investment over the next three years, even as it has had to slash prices across the board by 20 per cent to bring in more footfalls and maintain sales.
The company has been raking in sales of about Rs 10-12 crore (Rs 100-120 million) per year but this figure was beginning to take a hit with lesser number of customers trying out TGIF fare over the last two years, leading to the price slash.
A division of Carlson Hospitality Worldwide, TFIG set shop in India in 1995 after Carlson appointed Bistro Hospitality in India as its master franchisee in the country.
"We have not done business as targeted. There are several reasons for this but we have now taken various steps to fuel growth in India. Among them is slashing prices by as much as 20 per cent across the menu while maintaining portion sizes and going on an aggressive expansion mode," Sanjoy Roy, vice president of Bistro, said.
One of the problem areas in India was acquiring real estate, he said.
"We need Rs 5 crore (Rs 50 million) investment per year initially to open a new outlet. But in India, we take as long as three years to recover our money against maybe a year-and-a-half in operations in other countries," Roy said.
He said the company is planning to open its first outlet in Mumbai this month, followed by one in Gurgaon and then in Chennai and Hyderabad over the next two years.
Yet another area of concern was government's licensing policy, Roy said adding competition - like Ruby Tuesday chain of restaurants - has also got aggressive and TGIF needed to offer customers more value for money.
"What has helped us in reducing prices is the fact that we have been successful in indigenising up to 85 per cent of ingredients used in our dishes," he said adding efforts were on to increase indigenisation of ingredients further.
TGIF is one of the first American casual dining chains, operational since 1965. At present, there are a total 200 TGIFs operating in 56 countries with as many as 723 Friday's brands across the globe.
