Bakingo, an online bakery, is planning to invest INR 40 crore to expand its production capacity along with going omnichannel, according to Himanshu Chawla, Co-Founder & Director of Bakingo, as reported by ET.
The company is aiming to expand its production infrastructure in urban centers such as Bengaluru, Delhi, Kolkata, and Mumbai.
“Currently, we operate a 10,000 sq ft manufacturing facility in Bengaluru, with plans to extend it to 25,000 sq ft. Likewise, we already possess a 25,000 sq ft unit in Delhi, and our intention is to establish an additional unit covering 15,000 sq ft,” he explained.
We currently operate with modest facilities in Mumbai and Kolkata. We want to open new 10,000- and 15,000-square-foot production facilities in each city this fiscal year,” he clarified.
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Currently, the brand’s existing manufacturing units have the capability to produce 1,000 cakes per day. With the expansion of the production facilities, the goal is to increase this capacity to 3,000 cakes per day.
By October, the brand aims to inaugurate 30 to 40 Exclusive Brand Outlets (EBOs) within the span of a year.
“We are set to launch takeaway Quick Service Restaurants (QSRs) spanning 500-600 sq.ft. Initially, our focus will be on metro and tier I cities, followed by expansion into tier II and beyond,” he emphasized.
The capital expenditure (CAPEX) necessary for developing these company-owned and operated outlets will be between INR 70 and 80 lakh. The company plans to provide over 100 Stock Keeping Units (SKUs) in these Exclusive company Outlets (EBOs).
Additionally, the brand is strategizing to broaden its footprint in cities such as Kolkata, Chennai, Pune, Kanpur, Agra, Patna, Ludhiana, Patiala, Jalandhar, Ahmedabad, Indore, and Bhopal. Moreover, it aims to escalate its dark kitchens from 75 to 150, effectively doubling their number.
“We don’t have any plans on securing additional funds, as the $16 million raised from the private equity firm Faering Capital in November 2023 will be sufficient to drive our expansion initiatives,” he stated.
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“Ultimately, our vision is to establish a INR 1,000 crore national brand within the next five years,” he added.
At present, the brand operates in cities such as Gurgaon, Delhi, Noida, Bangalore, Hyderabad, Mumbai, Jaipur, Chandigarh, Lucknow, Meerut, Panipat, Karnal, and Rohtak.
In response to shifting consumer demands, the brand is also exploring menu expansion by introducing a range of savory options.
The brand, which concluded FY23-24 at INR 210 crore and FY22-23 at INR 140 crore, aims to achieve a growth rate of 50-60 per cent in the current fiscal year.
“At present, our EBITDA profitability is at 2-3 per cent, with an equal contribution of 50 per cent revenue each from both D2C and marketplaces,” he said.
The brand, which generates 40 per cent of its revenue from North India, experiences a 45 per cent rate of repeat orders on any given day.
Presently, its Customer Acquisition Cost (CAC) is INR 450 for an average order value of INR 1,000.
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