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Chennai pubs see business drop, owners focus on food to generate income

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Chennai may be consuming more alcohol than ever before, but the increase in demand hasn’t exactly signaled a spike in the city’s pub activity. In FY21, the Tamil Nadu Sales and Marketing Company (TASMAC), which holds the monopoly on alcohol retailing in Tamil Nadu, recorded its highest turnover ever: 33,811 Rupee crore, a 2% year-over-year increase over fiscal year 20 revenue of Rs 33,133 crore.

In contrast, almost all pubs in Chennai have started to experience a 20-25% drop in revenue from pre-COVID profits. These establishments believe that the increase in sales at TASMAC outlets is the result of the pubs being closed for a relatively long period.

“When consumers don’t have the option of having a bar or restaurant in town, they have to go to a TASMAC outlet, buy alcohol and have a house party,” Shiburaj said. SJ, co-founder of Dank, one of the relatively new pubs in Chennai. “This is one of the reasons TASMAC has probably seen its sales increase,” he adds.

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Shiburaj’s assertion is indeed relevant. With pubs in Chennai forced to stay closed for most of last year, and from April 2021 to a month ago, these establishments saw their business take a hit.

“Before the start of the pandemic, we were making over Rs 80 lakh (per month) in business,” said Sanjeev Varma, managing partner of Black Orchid, another recently opened pub in Chennai. “Business fell to Rs 50 lakh per month after reopening,” he says, “But we have now improved to between Rs 50 and 60 lakh per month because a lot of food contributes (to business).”

The story is similar in the city’s pubs. At least five pubs in Chennai that were trading around Rs 80 to Rs 1 crore per month saw their incomes drop and turned to food as a means of increasing their income. Good food, they say, could be a great differentiator, adding value to a pub’s F&B offering.

Today, 30 percent of the income of most pubs in Chennai comes from food. However, this is a number they want to increase. “We want our share of income from food to alcohol to increase to 45-55 in the medium term,” said Shiburaj. Whether income comes from food or alcohol, pub owners say they expect overall income to reach pre-COVID levels only by the end of December or mid-December. January.

Meanwhile, TASMAC stores continue to see cash registers ringing. In July, just four months after the start of the current fiscal year, alcohol sales at TASMAC outlets had already exceeded Rs 7,900 crore.

(Edited by : Jomy Jos Pullokaran)


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