Restaurant Entrepreneurship Opportunities in Tamil Nadu

Tamil Nadu is one of the most advanced State in India in terms of urbanization. There is always a town not separated at a distance of more than thirty kilometers. There is a large service sector and one has to understand the dynamics of it to understand the massive opportunities that can open up in different sectors. This article would focus on vegetarian restaurants.


Tamil Nadu is a State with a population of around 8 crore people. There is good scope to innovate in terms of slightly upper middle-class restaurants, and entrepreneurs from other States should study the successful models available to identify the gaps and open restaurants to just fill these gaps.

There are three types of Vegetarian restaurants. One is the Saravana Bhavan-type, the costliest restaurant that caters to the rich and the highest in the upper-middle-class market. There are other brands like Sangeetha and Askshayam that also compete in the same space. Each big city has the equivalent of such restaurants. For example, Coimbatore, the second largest and now the fastest growing city of Tamil Nadu, has the popular Annapoorna and the Gowrishankar group of restaurants.

There is also big B-class type of restaurants and these are growing, as those in the middle of the middle-class spectrum go to these restaurants. The prices in these restaurants are somewhat less when compared to the big brands. This can vary between 10 to even 30 percent in some cases. Of course, the hygiene is not so good in these hotels.

The next category is the C-class of hotels, where the prices are at the lowest end. For example, a dosa might cost just Rs.35 or Rs.40, and an idli just Rs.5/. The lowest middle class and sometimes the poor also frequent these small outlets. For example, auto drivers, students, and the tourists who travel by local buses frequent such hotels.

The new type of successful entrepreneur has to come through innovation. The space is available in all three slots. The gaps pertain to a) New offerings b) New side dishes for breakfast, lunch and dinner c) New combo offers d) Positioning through special dishes and e) Combo offers from all five South Indian States.

New offerings

Very few hotels in Chennai offer what is called the "arisi upma", which is nothing but a basic preparation from broken rice. In Tiruchirapalli, some hotels offer this dish. The hotels are all stereotypes for the side dishes. For example, since the vegetable is always cheaply available, the side dish is what is called the "beetroot poriyal". Carrot and cabbage are other combinations. However, those who experiment with new combinations and also offer one special vada like the banana flower vada, are tremendously successful. The slots for this kind of innovation and opening up of both A and B-class hotels are available at Salem, Tiruchirapalli, Madurai, and Coimbatore.

However, the aim should be to be totally new in terms of the offerings. Dinner should also be different.

New side dishes for all meals

Very few hotels serve what is called the "Kumbakonam Kadappa" or the "Tirunelveli Sodhi" for breakfast or for dinner. These are the two dishes that can bring in the crowds. If one serves the brinjal chutney for example during dinner, new markets will automatically open up.

New combo offers

Chennai and other big cities like Coimbatore and even a small town like Neyveli, have a massive North Indian population who long to have their kind of food. The number of restaurants that offer jalebi in the Gujarat style for breakfast is almost zero. One has to travel to different parts of India and experiment with new combo offers that can be priced at Rs.90/-. At the moment, the combo offers are all restricted to the main South Indian dishes and this needs to change.

Positioning through special dishes

There are hotels in all three categories that have made a name for themselves through special dishes. The special item that has become famous at the Rayar Mess at Mylapore in Chennai, is a lovely green chili chutney served at 7 a.m. in the morning. There are huge crowds at this restaurant. Any new entrepreneur can always come up with a signature side dish, perfect it, and offer it every day and when it becomes so famous, the crowds would automatically come in.

The new entrepreneur has to do some local research and identify the missing slots. For example, "aappam" is a special dish, that is so common in South Tamil Nadu, but it is always missing in most hotels in other cities like Coimbatore. One has to perfect it and offer the best "aappam" at prices that match other dishes in both A and C outlets. This dish can be taken for breakfast and for dinner as well. There are other examples, too. The Bangalore "thatte idli" is mostly not available. The fabulous neer dosa that is a big hit in Mangalore and the nearby cities and towns of Kerala, is totally missing. One has to create a new market with such offerings.

Combo offers from all South Indian States

The brinjal floating in oil can be done in Andhra style. Add to this the akki roti, the Tamilian aviyal, (a combination of several vegetables cooked and mixed with curd and a chutney of coconut and green chili), and so on, and surely it will attract the diners. The unlimited food can be priced at Rs.299 in the A-class hotels and at Rs.175 in the B-class hotels.


Given the kind of gaps that exist in all three categories of hotels in the vegetarian food segment, and the need for innovation, certain ideas have been described above. There is a huge scope for innovation and one who offers different dishes will always create big markets. For, creating new markets is relatively easy in this field. Of course, in order to innovate in the food sector, local partners in the business can help a great deal. Outright purchase of the outlet is another option. However, the best cooks can only be found in the villages, and one should identify such people and encourage them to become regular employees. Then one can surely be successful in this restaurant entrepreneurship.


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