How SaaS Startups Are Reinventing The HORECA Industry In India

In the wake of the pandemic, the Hotel, Restaurant & Café (HORECA) business in India was in need of urgent transformation to grow. While restaurants experimented with various strategies, SaaS startups provided the technology that enabled this transformation.

The HORECA industry is a legacy industry that has passed down best practices from generation to generation. It has been somewhat resistant to change, as are most legacy industries, and this is especially true in India, where a large portion of the industry is still unorganised and thus fragmented. Things are changing, however, and technology is playing an important role in the evolution of this sector. 

Operational Challenges In Corona Times

It’s a shift that has been accelerated by Covid, with exponential growth taking place in the online-delivery domain. Pre-pandemic, the concept of ordering food online was still in its infancy, with restaurants still largely focused on the dine-in experience. Unsurprisingly, their operations were not optimised for online delivery, and so the customer experience was impacted when restaurants started catering to online delivery.

Internationally, however, a digital transformation was underway, with some of the world’s largest brands already making technology a key component of their offering. Starbucks, for example, has a successful loyalty programme, and McDonald’s has made significant digital investments. These are just two of the top brands that are using data to improve their margins. The Indian market had yet to mature. 

That changed overnight when lockdowns confined us all to our homes and online delivery became the norm. Restaurateurs had no choice but to adapt to the new normal and new technology. For them, it became a matter of survival.

While it gave restaurant owners the opportunity to grow their businesses in ways they wouldn’t have imagined months earlier, the evolution brought with it its own challenges. Entrepreneurs in this space recognised that the customer experience entailed more than simply being served delicious food. They recognised the importance of investing in technology to improve the customer experience across multiple touchpoints.

Contactless Food Delivery & Emerging Tech

Dine-in revenues had dried up and restaurateurs had to find new ways of retaining their clientele. Covid had upended the ordering in/dining out ecosystem and altered the nature of demand, forcing restaurants to come up with an answer. Collaborating with SaaS startups turned out to be the solution.

SaaS enterprises answered everyday challenges and brought convenience to routine tasks. These included payments, invoicing, and billing; inventory and stock; supply chain management; raw material sourcing; and online delivery. Furthermore, these SaaS products aided in the management of purchase orders, tables and supplies, menu management, data analytics, food costing, and other aspects.

The goal of these cloud-based technologies is to alleviate the pain of time-consuming operations by automating them, allowing restaurants to focus their efforts on improving customer relationships. In this way, SaaS has become a disruptor in the best possible sense, paving the way for businesses to reduce costs, increase revenue, and scale up. 

Brands in the HORECA space have been adopting SaaS since 2020, and more are expected to do so in the coming years as the industry adjusts to the post-Covid reality. The exciting news is that we have only scratched the surface of technological adoption. Restaurants that are more tech-savvy are already reaping the benefits, but the majority are still adjusting to the new normal.

There’s no arguing that the landscape has changed and will continue to evolve. Contactless ordering as well as omnichannel ordering via food apps or websites, is now an accepted part of eating out and dining in. 

Data will become increasingly important as businesses strive to stay ahead of the competition through concepts such as ‘smart menu’ management or personalisation. None of this can happen without the technology that SaaS-based startups have.

However, the coming years will show that there is room in the market for multiple players. SaaS platforms that solve for specific pieces of the puzzle will continue to emerge, while established players may continue to improve their offerings.

From staring at an uncertain future to now embracing cutting-edge methods to stay relevant and boost their profile, members of the HORECA family are riding on a SaaS-led revival and primed to transform their fortunes. It appears there’s plenty more to come in this evolution.