The COVID-19 pandemic continues to significantly impact and disrupt businesses in all sectors and has negatively affected almost every person on a global scale in some way, shape or form. Restaurants worldwide have been dealt a particularly hard blow with devastating effects on the industry. Many restaurants in Sri Lanka, just like from around the world, have had to shut its doors for good. Chef Robert Irvine says in a CNN business article that given how difficult it is for restaurants to thrive even under ideal conditions, he estimated that 30% to 40% of all restaurants might never open up again. He goes on further to quote Yelp as having recently reported that the situation is even worse. It estimated that as many as 60% of restaurants that closed during the pandemic are now closed for good. These are dire straits indeed, and tough times for everyone, but especially so for those who have put their heart and soul, not to mention large amounts of capital in to the restaurant business. In a situation where each day seems to take you one step back instead of forward, how does an entrepreneur – like our friends at KOTTULABS, or anyone for that matter – keep a business afloat?
With no clear finish line to the current world health crisis, KOTTULABS along with its peers needed to look at new and innovative ways to remain viable; to come out stronger on the other side. Don from KOTTULABS says that this time has been a learning opportunity despite the lockdown in March and subsequent restrictions having a major negative impacts on the business.
Back in December 2019, KOTTULABS expanded the business to accommodate a dine-in facility for up to 52 customers; which involved moving to a newer, larger building among other changes. Following all this KOTTULABS had an increase in business making February 2020 their best month – revenue wise, so far. But immediately after that when the pandemic first hit Sri Lanka in March 2020 and the country went into lockdown, KOTTULABS went from being open 7 days week to just 3 days a week during the months of April and May 2020. Then with the second wave hitting the country towards the latter part of the year regulations stated that restaurants were not permitted to operate dine-in services; which was 50% of KOTTULABS’ sales. To say that KOTTULABS had a tumultuous year would be redundant.
With no tourism and the movement of people restricted by the pandemic many business, especially in the food industry have had to close their door and sadly many people lost their jobs and income. Business gurus and restaurateurs worldwide have come up with lists of ‘strategic moves’ that one can make to stay afloat during these trying times. One of which obviously is reducing costs including – staff and salaries – one of the biggest overheads for any business. However Don says KOTTULABS decided not to go that route and they maintained the same staff and their salaries.
Instead, Don says, KOTTULABS made a couple of ‘strategic moves’ of their own to adapt to the new normal and keep their business afloat. One of the ‘moves’ they made was their initiative to buy local and support local businesses. A decision to look after their own revenue stream and bottom line while also supporting other small local businesses. He specifically mentions that while he acknowledges that global franchises in Sri Lanka also need our support in this time, because they employ local people, what he means by ‘buy local, support local’ is that we pay more attention than we usually do to smaller scale, local entrepreneurs whether it be in the food industry or any other. “Being a relatively small business ourselves, we understand the importance of support from local customers, especially in a time such as we are facing now” says Don. He further states that if we all pulled together to support each other more, locally, then we would be doing our part to get the economy back on track.
Therefore with this in mind KOTTULABS partnered with several small businesses such as The Bake Cottage, Mel’s XOXO, Hunger Squad and many more. Don says that since the KOTTULABS dessert menu was slim they thought that working with external dessert providers would help them give their customers a good option while it also allowed them to concentrate on their main product. They initially worked with up to seven local home bakers by featuring one home baker per week and a selection of their deserts. Currently however KOTTULABS works exclusively with The Bake Cottage for their desserts. As a further drive to support local and continue to work closely with local SMEs, KOTTULABS are looking at other food related vendors beyond just desserts. Dons says good things are in the pipelines where the “buy local, support local” venture is concerned. Customers have a lot to look forward to in KOTTULABS’ 4th year of operation.
The other strategic move that KOTTULABS made during this period was the cloud kitchen concept. While this is not a new concept to Sri Lankan restaurants at all – as many other well established eateries have made the same move – it is a move that has helped KOTTULABS stay afloat by creating a new revenue stream and a way to serve a new clientele by using the resources they already have.
Cloud kitchens are restaurants that are based on delivery only; without a dine-in or take away facility. No infrastructure, waiters, furniture, etc. are involved. Customers place their orders by calling in, web portal or through an app; hence, the name ‘cloud kitchen’. The KOTTULABS cloud kitchen is called “Lankan by KOTTULABS” and provides a tasty, clean and affordable lunch delivery service targeted at office workers. The rice packets are priced between rupees 200 to 350 and are available in a number of vegetarian and non-vegetarian options. As the cloud kitchen operation grows and establishes itself Don says KOTTULABS in hoping to also do the same by also offering breakfast options; also targeting the working crowd in Colombo.
Last year when KOTTULABS celebrated two years in the industry this writer did an article – which you can read here – in which Don said that ‘it’s their passion and drive and how much they wanted this venture to be a success that kept them hustling and pushing forward through the good and the bad; always looking out for their ‘baby’, KOTTULABS’. The year 2020 and their response to it has definitely proven this statement to be true. It is truly inspiring to watch these four guys put in the hard work and to see it paying off for them. KOTTULABS is still a well-loved restaurant in Colombo and their loyal following is still with them.
When we last spoke with Don he also mentioned looking at opening a branch of KOTTULABS in Los Angeles. When I inquired about this he said that all the ground work with the official reports and approvals have been done, all the hoops have been jumped through, so to speak, and it’s only the pandemic raging like wild fire in the U.S that has kept the actual opening from happening. However they are looking forward to opening the branch in L.A as soon as possible and also he says they are looking at doing the same in Canada.
So as always the guys from KOTTULABS are full of plans and hope for the future, and as they celebrate three years of KOTTULABS I wish them all the very best and more strength to them to keep pushing forward.