written by Khatabook | January 4, 2022

What is the Cost of Chai Sutta Bar (CSB) Franchise In India?

The CSB or Chai Sutta Bar brand has its roots in Indore, and Madhya Pradesh, where having a nukkad or adrak chai in a kulhad (clay cup) is part of the local culture. The Chai Sutta Bar menu provides the same tasty chai in an ambience that makes its taste a luxurious experience across its chai franchise operations. And though the name connotes that Sutta or the cigarette is part of the outlet, smoking is disallowed. The growth of the Chai Sutta Bar has brought employment and prosperity to scores of potters and their families, who craft the kulhad or clay pots in which the tea is served at all Chai Sutta Bar outlets. Let us explore the progress of CSB and how you can start your own Chai Sutta Bar franchise. 

Indian Chai Business:

The tea business, or Chai Business, as it is fondly called in India, ranks number one in the consumer market. Indian people consume coffee and tea regularly throughout the day, and about 80% of the local produce is consumed within the country. The demand for hot tea spikes in winter, but tea is also considered refreshing any time of the day and in  any season. Tea as a good business opportunity has been proven by the Chai Sutta Bar, which has over 200 and counting franchisee-outlets all over India. Do you see a profitable opportunity in the Chai Sutta bar franchise operat ion? Here you can find all the franchise details that you need.

All about the Chai Sutta Bar:

  • Chai Sutta Bar is an Indian café chain that started in the early months of 2016. The company was born in the initial Chai Cafe in Madhya Pradesh’s Indore. 
  • The initial sales of 4 to 5 thousand teas sold in kulhads have risen exponentially to 80,000 plus sales every day. 
  • They now aim to increase their presence in India and globally through the Chai Sutta Bar Franchise opportunity. 
  • The use of ‘Bar’ in the name suggests that the CSB provides the goodness of tasty Indian-traditional hygienic tea and beverages, served in a kulhad at affordable prices. 
  • The store's ambience is that of a nukkad bar with a bar table. 
  • They plan on having at least 200 plus franchisees all over India. 
  • The word ‘Sutta’ is in the name which suggests swapping cigarettes for tea. It is not only a unique name but also an indirect promotion of Indian culture tea. It also promotes the artisans who are making the kulhads, reducing plastic use and more.

 

The CSB founders and owners:

The CSB was founded by these young Indians:

  • The Director Co-Founder Mr Anand Nayak.
  • The Director Co-Founder Mr Anubhav Dubey.
  • The Managing Director, Mr Rahul Gothi, takes care of the operations.

CSB plans to be in every expanding city and has stores with a bar franchise India and abroad like in Canada, the UK, the USA, Dubai, Muscat, whose numbers are growing.

Anubhav, the co-founder, borrowed from friends to fund the initial capital cost of opening a bar in India of a mere ₹2 lakh. Their turnover from 3 lakh tea cups per day across the outlets is worth over 100 Crore, with the CSB net worth exceeding ₹50 Crore! 

The Chai Sutta bar franchise in India gets their Assamese tea blended with a proprietary chai masala to make the famed kadak kulhad masala chai. The chocolate tea on their menu is another favourite item among people in India and abroad. A lot of research went into choosing the right idea, menu, products, price, locations that have led to the success of this brand. 

Did you know? Yahoo is an acronym which stands for “Yet Another Hierarchical Officious Oracle”.

Also Read: Smart Franchise business opportunities in India

Chai Sutta Bar Franchise Details

The Chai Sutta Bar Franchise is being offered across several locations. For an initial investment of ₹16 lakh, the franchiser anticipates a quick 15 month payback period, and an average of ₹90,000 pm returns every month. That is a smart strategy and even takes the humble tea to a branded international level while promoting Indian artisans (over 5 lakh kulhad per day requirement), reducing plastic and showcasing Indian culture. 

Let's go over the details of the Chai Sutta Bar Franchise:

Investment: 

CSB requires a solid financial backup and the ability to invest from ₹ 16 to 20 lakh.

Experience:

The experience of the company or entrepreneur is as follows. 

  • The Chai Sutta Bar owner needs relevant years of experience in the food services industry though the franchise agreement provides support and training. 

  • It also needs an experienced company or owner to run the day-to-day business operations efficiently.

Location and area details:

Starting the tea café business, beverages and food sections need a commercial area with many footfalls. The area required is from 300 to 2,000 sq. ft close to a railway or bus station, educational institution or shopping high street. You need not own the place. You can rent commercial space at reasonable rents ranging from 20K to 30K in most cities. 

Chai sutta bar franchise cost: 

For any Indian location, the Chai Sutta Bar Café franchise fee is ₹6 lakh with a required investment of ₹16 lakhs. The Chai sutta bar franchise cost has a return on investment (ROI) of 2%. The breakup in a quick reference table is given below:

Particulars

Investment

Commercial space 

300 to 400 sq. ft minimum

Equipment and machinery

₹ 3 lakh

Furniture and décor of interiors

₹ 5 lakh

Raw materials initial investment

₹ 2 lakh

Franchise Fee

₹ 6 lakh

Total investment

₹ 16 lakh

ROI 

108%

Payback period

14 to 18 months

Royalty fee

2% of turnover

Term of agreement

5 years

Official website

https://chaisuttabarindia.com/?page_id=673

Contact details

Tel no: 91-6262300031

Email: chaisuttabar@gmail.com  or business@chaisuttabarindia.com

Address for communication

406, Janjeerwala Square, Silver Arc Plaza, New Palasia, Indore, Madhya Pradesh -452001, India.

What to expect as a Chai Sutta Bar owner:

You can expect facts mentioned below and more from the 5-year CSB franchise agreement.

  • A safe learning experience from a successful venture

  • Profit margins range from 35 to 40% or around ₹ 90k per month

  • Your working capital to be from ₹ 1.5 to 2 lakh

  • Raw material or food costs are around 32 to 35% of the turnover

  • Chai Sutta Bar will supply the important raw materials, technology and interior layouts

  • Manpower requirement of 3 to 5 persons

  • Tie-up with an online delivery partner

  • CSB provides marketing, sales support, a Chai Sutta bar menu and staff training

  • Chai Sutta Bar interior layouts and design provided under the franchise agreement.

Business tips for success:

No matter which business idea you choose, here are some tips to help you convert your ideas.

  • Never be afraid to research fresh ideas when studying the idea, demand, market potential.
  • Keep your background, knowledge and skillsets in mind when you venture into business.
  • Several franchise operation ideas can also help earn you millions like Coffee Day, Apollo PharmacyKFC etc.
  • Have a budget and plan your marketing strategy to ensure a quick payback period.
  • Check out the returns and ROI for every opportunity.
  • Research every doubt you have and never hesitate to take professional help wherever and whenever needed.
  • Ensure you obtain the necessary permits and licensing required for your business.
  • Use technology to your advantage and check out the Khatabook app to free up your time by simplifying your business. You can generate buisness reports, make secured transactions and much more.
  • Learning is an ongoing process, and you can do this all the time!
  • GST registration is essential. Ensure you use accounting help to save yourself from financial hurdles and problems.
  • Low on budget? Don't worry! Seek out an angel investor.
  • Lack skills? Try the online courses, certified training institutes to add value to your profile. 

Also Read: How To Set up a KFC Franchise In India

Conclusion:

The Chai Sutta Bar story is from rags to riches and from hard work to success. With adequate effort and strategy in entrepreneurship, one can make it into a successful venture. Its growth through the Chai Sutta Bar franchise is another significant opportunity that can aid entrepreneurs like you to start their businesses. The offer is exciting, generous, profitable and very attractive. Therefore, adhere to the business tips and follow the requirements to start your Chai Sutta Bar franchise.

Once you start, you may face problems with accounting, employee management, GST filing, and more. Did you know that small businesses can benefit from a one-stop solution with the Khatabook app? Try it out today to free up your time and focus on growing business ideas.

FAQs

Q: When did Chai Sutta Bar start?

Ans:

Chai Sutta Bar’ started in 2016 July with a small capital of ₹ 2 lakh at Rewa, Indore of Madhya Pradesh. They have 5 own outlets, and the rest are franchised operations.

Q: Does CSB offer franchise opportunities?

Ans:

Yes. The offer for franchisees can be found on their official website.

Q: How much is the turnover of Chai Sutta Bar?

Ans:

Quoting from the MCA details, the company’s authorized share capital is ₹ 10 lakh. The Chai Sutta Bar turnover in the last financial year is indicated as ₹ 100 Crore.

Q: How many Chai Sutta Bar do they have in India?

Ans:

According to the founder, CSB has over 200 exclusive CSB outlets pan-India and abroad.

Q: Is smoking promoted in the Chai Sutta Bar?

Ans:

No. The chai is pitched to keep the younger generation off cigarettes and smoking. They follow a ‘No Smoking’ policy.

Q: How many CSB outlets does India have?

Ans:

Chai Sutta Bar started in Indore, has a unique business model and encourages the artisans to make the Kulhad. Their quality and taste come at affordable prices, and their growth has spurred them to offer franchise operations. At present, they run 135 outlets and hope to have at least 200 such outlets shortly.

Q: How much revenue can be expected from Chai Sutta Bar outlet?

Ans:

With an investment of approximately ₹ 16 to 20 lakh, the payback period is anticipated to be 14 to 18 months. This means Chai Sutta Bar profit margin revenue of over ₹ 90K per month from a single outlet.

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