The wharton wallah who sells ice cream

The wharton wallah who sells ice cream

Ice cream maker Rohan Mirchandani believes that the fun of making your own flavour on a cold stone outdoes the premium proposition of helping established foreign brands entering the Indian market

DIVYA MEENAKSHI CHANDRAMOULI

By Rohan Mirchandani’s own admission, Ben and Jerry’s is his favourite brand of ice cream. Now, that wouldn’t be surprising to most – just that Mirchandani is in the business of making and selling ice cream. Even as we talk business, Mirchandani’s candour stays in place. “It’s only been about six months since I’ve completely devoted my time to Hokey Pokey,” says the founder-CEO. Before he realised the opportunity that lay in pursuing this business, full-time, Mirchandani had a budding career in finance. In fact, when Hokey Pokey (under the parent company Drums Food International Pvt. Ltd.) was established in 2008 alongside three other founding members, Mirchandani had quit his job and taken the GMAT with the thought that if an ivy league business school beckoned, he’d go. He made it to The Wharton School (Wharton) and ironically, this is where the realisation dawned. “I knew that what I ultimately wanted to do was build a brand and there was one, waiting for me in India,” he says.

However, for Mirchandani and friend, confidant and co-founder, Milap Shah, ice cream wasn’t an immediate business draw. “We grew up as friends, me in the U.S. and Milap in India. Even when Milap came to Stanford to study Computer Science, we both were contemplating starting a business in India. We kept thinking technology was the way to go,” says Mirchandani. While a technology driven business idea never gained ground, a chance meeting with Chef Ganesh K.  changed the duo’s direction. With over two decades of work experience in the food and beverage industry, Ganesh is an expert gelato maker who spent sometime honing this skill in Italy. With Ganesh playing catalyst, Mirchandani and Shah decided to invest their time and money in making ice cream.

As for the type of ice cream they wanted to make and sell, neither was confused. They were swayed by their experience at Cold Stone Creamery at its Times Square store. “I’d never ever tried mixing my own flavours on a cold stone and I went nuts,” recalls Mirchandani. Ganesh, however, had his heart set on gelato. In a bid to win him over, Mirchandani and Ganesh made a trip to Dubai to experience the concept of creating flavours on a cold stone. And Ganesh was a ready convert. Thus, was born Hokey Pokey, the Indian ice cream brand that allows you the child-like thrill of putting together your own dairy milk-based ice cream, a world where whacky is welcome.

Going for it

Hokey Pokey had a slow start as, at first, its founding team thought of it only as a side business. Each member had other professional interests they were tending to. However, post his stint at Wharton, Mirchandani is completely on board the Hokey Pokey wagon. At a time when new, young India is more willing to spend, the core team is focused on tingling its taste buds. In this financial year alone, the company has seen an outlet growth rate of about 20 per cent with its current toll at 20 outlets spread across the country, with a primary focus on Maharastra, New Delhi and Bengaluru. “Over the next two years, we’d like to see that number touch 150,” shares Mirchandani. Like many gen-next entrepreneurs, he believes India’s growth story lies deep within. “It makes perfect, logical sense to pursue growth in the Tier-II and Tier-III cities and towns and when we get there, we’ll be ‘the super premium brand’ as opposed to being just another ice cream brand in the metropolitan cities,” says Mirchandani. And he’s also quick to credit the evolution of Indians as consumers. “We can’t take the Indian consumer for granted. These days, people no longer buy into just a ‘foreign’ brand, they buy into a brand that offers them a value proposition.” And while many others would be threatened by the entry of premium ice cream brands such as Haagen Dazs into the Indian market, Mirchandani sees them as an enhancement to the industry as consumers are now appreciating good quality ice cream. “Right now, there might be people viewing our product as pricey. But when they realise that they’re paying Rs. 50 a scoop for a good product and an even better experience as opposed to Rs. 180 a scoop from another premium brand, we will find more takers from the middle income bracket,” he opines.

When asked about ‘Indianisation’ of menus, a route that established quick-service restaurant brands have taken in the past, Mirchandani says that Hokey Pokey prefers a flexible approach over rigid standardisation. Explaining with the help of an example, he talks of a Diwali special where gulab jamuns were mixed with ice cream on the cold stones at the company’s stores. And the response was mixed to say the least. “We sold two at our store in Bandra, but we sold so many at Borivali, Mumbai, that our franchise partners requested us to make it a permanent feature,” he shares.

In the 19th century and early 20th century, ice cream vendors in New York were called Hokey Pokey men. We just fell in love with the name, Hokey Pokey!

Even as he shares his financial outlook for the company, Mirchandani has his ambitions set high, “We expect a 200 per cent annual fiscal year top line growth next year and 150 per cent the following year. We have built our back-end for scale and are ready to do so now,” he says.

Three-pronged growth plan

Hokey Pokey’s growth strategy has been divided into three, expansion by way of company-owned stores, tying up with franchises and entering collaborations. One example of the latter is its partnership with Barista Lavazza. The company has tied up with the coffee chain by opening up a live counter at its Bandra Banstand store. “This is a perfect fit as coffee and ice cream go hand in hand, you want coffee in the morning and ice cream in the evening, you go to the same place to get both,” sums up Mirchandani. In the near future, both brands plan on taking this idea to other Barista Lavazza stores across the country. As Mirchandani says, a collaborative effort makes business sense for the company as it faces steep real estate costs in the metropolitans. It’s a route that Hokey Pokey plans to pursue with restaurants and retail businesses. For its own stores, the company prefers to rent out space at malls. “In the local markets, there’s a lot of bureaucracy and we don’t want to get mixed up in all of that,” states Mirchandani.

As for tying up with franchises, Mirchandani explains that the company is always on the lookout for local partners in geographies where its reach and understanding is limited. “I’m personally involved in picking out franchise partners as we’ve had good and bad experiences in the past,” he shares. Picking out the right franchise partners is one challenge area, the most significant other is talent acquisition. “I’ve spent nearly four out of my last six months working on a hire and retain strategy. Unfortunately, in India, people think short-term over long-term and each time somebody’s offered a 20 per cent raise, they move,” says Mirchandani.

Until now, Hokey Pokey has been funded primarily by the partners’ capital and by investments made by family and friends, but, as it looks to scale up, it is looking to external investors. While talks are on with several investors, Mirchandani is confident that the company will see an institutional round of funding by the second half of the current fiscal. As for spreading the word, it has relied heavily on social media. “Until now, our marketing spends were fairly low. We have now increased our spending in this area to about 5 per cent of our revenue,” shares Mirchandani.

As we draw to a close, I ask Mirchandani to name Hokey Pokey’s most significant differentiator – he chooses to say, people. “In time, I’ve realised that it’s the people as much as it’s the idea that make things work,” he signs off.


SNAPSHOT 

Hokey Pokey 

Founders: Rohan Mirchandani, Milap Shah, K. Ganesh 

Year: 2008 

City: Mumbai 

Investments: Self-funded, looking at an institutional round in the second-half of this fiscal 


What’s different at Hokey Pokey?

A Hokey Pokey parlour is a place of fun where you can make a childhood dream come true – make ice cream. And that too by throwing in whatever you fancy on a cold, stone slab and watching the ice-cream man juggle it up for you. The air is not formal and the focus is not on selling a ‘premium’ product, vouches Rohan Mirchandani, founder-CEO, Hokey Pokey. “When we think of ice cream, we think of our childhood with our faces and clothes splattered with ice cream. Even though our mothers screamed at us for being messy, they couldn’t help but smile. Hokey Pokey is the essence of that smile,” shares Mirchandani. And as always, the proof lies in eating the ice cream and judging for yourself how good it is.