Chai Point switches focus to cloud kitchen model, loyalty program to accelerate growth

Omnichannel tea and snacks retailer Chai Point is stepping up focus on cloud kitchens and enhancing its loyalty program for extending brand’s reach and improving customer experience, its co-founder and CEO Amuleek Singh Bijral told FE Online. “We will set up cloud kitchens either on our own or through partnerships with various aggregators…We are also reconfiguring our loyalty program – PrioriTea – by rewarding customers and giving product-centric benefits. This will be applicable for customers choosing online delivery apart from the walk-in customers at our stores,” Bijral added.

“Chai Point will soon be taking it to corporate companies where its ‘boxC’ tea and coffee dispensers are installed. While boxC is the fastest growing model for Chai Point, it has the market penetration of only 15-20%,” he said.

Earlier, the startup had around two cloud kitchens, but Bijral wasn’t too keen on growing the model. With the growth in its delivery model, the company is now planning to invest more in cloud kitchen-based deliveries. “Our data tells us that customers experience for delivery of products like tea has been great. Moreover, the delivery model is one of the fastest growing businesses for us,” Bijral further said.

“In cities where customers are not able to experience our products, cloud kitchen model works effectively. We are seeing this aspect of delivery becoming habitual among customers,” Bijral said.

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Nonetheless, the number of walk-in stores that Chai Point is planning to open will still be much higher than the cloud kitchen set-ups. The company is currently scouting locations to launch cloud kitchens. He, however, didn’t comment on the number of such e-kitchens to be opened.

The startup is hoping to Ebitda positive in the next financial and will be growing at 50-55% this year, he stated.

Chai Point recently partnered with digital wallet company Paytm for a hybrid contractual and on-demand payment system in its boxC dispensers. Its (POS) point of sale and cloud POS Shark will be integrated with Paytm for its boxC dispensers.

The company has over 2000 boxC installations across 8 cities and contributes to more than 38% of its overall revenue, the company statement said.