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-Khwaish Jain (cbedit@imaws.org)
The hotel and catering industry is currently grappling with challenges, including soaring raw material costs and a significant shortage of skilled labor, and food wastage. As the festive season has come to a close, many establishments have felt the pinch, prompting adjustments in pricing and operations. To undercover the solutions and what the future holds for the industry, Kitchen Herald spoke to the industry expert Mr. Narendra Somani, President of the Federation of All India Caterers and Chairman & Managing Director of TGB who offered valuable insights into these pressing issues and outlined potential solutions for the future.
In recent months, the cost of raw materials has surged, with rates rising by approximately 10% each month following the festival season. This trend has forced hotels to revise their pricing structures. For instance, brunch and coffee shop rates have notably increased, while catering services have adjusted their rates by 10% compared to last year. Mr. Narendra explains, “Food costs alone account for about 3% to 4% of our overall expenses. Coupled with annual increases in employee costs, we are left with no choice but to adjust our prices accordingly.”
One of the most pressing challenges facing the industry is the acute shortage of manpower. Both skilled and unskilled labor are hard to come by, particularly in unskilled positions often filled by what are referred to as KST boys. Despite offering competitive wages exceeding 1,000 rupees per day along with meals, finding workers remains a daunting task. “The average salary for these positions is around 30,000 rupees,” the spokesperson notes. “Yet we continue to struggle to attract candidates, especially here in Gujarat where fewer people are interested in pursuing careers in hotel services.”
He also identifies two primary reasons for the dwindling interest in hotel careers: a lack of awareness about opportunities within the industry and inadequate compensation for trainees. Many students who train at five-star hotels often discover that their pay does not reflect the workload they are expected to handle. “Trainees typically start as loaders for six to eight months before moving up,” they explain. “This discourages many from continuing in the field because they fear negative experiences and exploitation.”
To address these recruitment challenges, he advocates for implementing a standard law that mandates trainees receive a minimum salary of 10,000 to 15,000 rupees per month. Currently, many establishments offer only 3,000 to 3,500 rupees, which fails to attract quality candidates. “If we want to improve recruitment,” he asserts, “we need to offer competitive wages that reflect the demands of the job.”
Looking ahead, Mr. Somani expresses optimism about the growth trajectory of the hotel business across India. With Prime Minister Modi focusing on tourism development, there is significant potential for expansion. However, they caution that India’s tourism figures still lag behind those of smaller countries like Turkey. “Despite having a larger population,” he observes, “countries with smaller populations have better tourism figures because they depend heavily on it. We need better infrastructure and connectivity to elevate our tourism sector.”
The Federation of All India Caterers Association is actively working to better organize the catering sector, which currently suffers from fragmentation. They are conducting training sessions focused on hygiene and presentation standards for caterers in smaller towns. “While larger hotels generally adhere to established standards,” the spokesperson explains, “many smaller establishments do not follow any guidelines at all.”
For single outlet operators facing challenges in this competitive landscape, Mr. Somani offers pragmatic advice. Many restaurant owners may romanticize the business due to busy weekends but often overlook significant expenses—such as rising food costs and staff wages—that can threaten profitability. “My advice is simple: adopt strategies like using frozen items or pre-prepared gravies that can reduce costs and lessen reliance on skilled labor,” they recommend.
Unfortunately, interest in joining industry associations has declined recently. In western India—which encompasses seven states including Gujarat and Maharashtra—membership numbers have stagnated at around 1,500 despite an estimated 5,000-8,000 restaurants operating in those areas. “Many smaller operators believe that larger players will handle industry issues without their involvement.”
He outlines several collaborative initiatives that could enhance development within the hotel industry and suggests that the government should introduce affordable short courses like waiter training in partnership with industry experts to create a skilled workforce aligned with market needs. Additionally, engaging with hotel associations can help advocate for favorable policies and tax reforms that address industry challenges. “Investment incentives such as tax breaks for new hotel developments would encourage more investment in hospitality,” they add.
Furthermore, improving transportation and tourism infrastructure through partnerships with local governments is crucial for boosting accessibility for travelers. “Joint promotional efforts highlighting regional attractions can further increase hotel occupancy rates,” they emphasize.
The major challenge of all is that food waste remains a critical issue within catering services due to inefficient recovery systems that lead to significant amounts of leftover food being discarded—especially during late-night operations. Consumer behavior also contributes; extensive menus often result in over-preparation and excess food wastage. He notes that operational constraints limit timely pickups of leftover meals for donation or salvage. “There’s a lack of awareness about food waste impacts among consumers and restaurant operators,” they explain.
To combat food waste effectively, they propose increasing awareness among consumers about responsible ordering practices while also advocating for clearer guidelines regarding liability that could encourage more restaurants to donate leftover food. “Implementing technology-driven solutions can improve inventory management and demand forecasting,” he concludes.
As these insights reveal, while challenges persist within the hotel and catering industry, there are clear pathways toward improvement that can benefit both operators and consumers alike—highlighting a resilient sector poised for growth amidst adversity.
