18 Jan 2008


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Profile: Shalil Bhattessa and Yougesh Jegeswaran

Budgens

Independent

Shalil Bhattessa and his business partner Yougesh Jegeswaran may be new to the retail trade but they are already making quite an impact in North London, through the Budgens store they opened in Archway last May and the East Finchley outlet they took over in the autumn of 2007.

They are the kind of entrepreneurs coming into the independent trade since Budgens decided to go down the franchised route with its company-owned stores. Bhattessa and Jegeswaran run a hotel business, with one of their hotels, The Barn Hotel, Ruislip, Middlesex close to where the Budgens head office used to be until the takeover by Musgrave.

Bhattessa says Budgens’ management used the hotel facilities and so he was aware of the company. The retailer came back into focus when the two businessmen were looking to expand their interests and looked closely at the retail trade. “There are very few opportunities in hotels to expand,” says Bhattessa.

Transformation

Budgens, he says, did not seem such an appealing target when they first looked at the business as many of the shops in and around London seemed to be “run down”.

“I said ‘no way’. But, when I investigated further, a lot of the stores had divested and it had become a franchise [business]. The transformation was stunning,” he says.

“To me it’s [Budgens] a brand going far. It’s a very niche product positioning, but there is flexibility in the brand.” Negotiations to take over Budgens’ existing store in East Finchley were prolonged, but the opportunity to build a new store arose at the Archway end of the busy Holloway Road. “It was taking such a long time and in the meantime I found this site,” says Bhattessa.

The site was a former Allied Irish Bank and it took Bhattessa and Jegeswaran three months to convert it into a 3,000sq ft Budgens convenience store.

Bhattessa says: “It was good because we had a clean piece of paper to work with.” He says Budgens encourages its independent retailers to “cater for the local market” and Bhattessa believes that is what the Archway store has done since it first opened its doors in May 2007.

Archway is in what he describes as a “typical inner suburban area”, with council property on one side and large Victorian houses on the other. A walk round the store shows it is meeting the demands of a very mixed local population, who also have a wide choice of shops in the immediate area ¬ from the Sainsbury’s Local next door, the Co-op opposite Archway Underground station, a Waitrose further down the Holloway Road, as well as a host of small independent outlets, including a bakery and an organic food shop. “We have the advantage of being brand spanking new and we have the advantage of being innovative,” says Bhattessa.

Premium offering
The Budgens store caters for the basics, but it is its more premium offering that is creating points of difference to other outlets in the area.

Customers entering the store first see one of Innocent Smoothie’s “fresh as a daisy” chiller units as well as a premium French cake stand from Patisserie Les Coules de la Marche. There is also a stand for Green & Blacks organic chocolate and even the snacks tend to be more premium, including brands such as Tyrells, Jonathan Crisp and Pipers.

The speciality beers on offer include a Trappist beer (retailing at £3.26), as well as Leffe Bruin (£3.23) and Ch’Ti (£2.83), both in 750ml bottles. The store has linked up with the Taste of Sussex promotional body and brands stocked include beers from two of the county’s breweries, Ballards and Hepworth.

The wine range includes a white wine from the Seddlescombe Organic Vineyard (£9.99), along with a white burgundy from Blason de Bourgogne (£13.99) and Wolf Blass President’s Selection Chardonnay (£9.99).

But, it is in food-to-go that the Budgens store is scoring over rival retailers in the area. The shop offers a smoothie and sandwich bar, while its hot food range includes hot whole chickens (£3.79), pork hocks (£1.99) and rotisserie chicken sandwiches (£2.49). Hot meals include the curry offerings from both the Noon and Bombay Brasserie brands.

Bhattessa has big plans for the food-to-go area and he even hopes to bring the “café culture to the main road” in the spring and summer by providing chairs and seats on the pavement outside, with service via a hatch connected to the hot food area. “We have a real presence on the main road,” he says.

“It’s going to look really impressive. There is nothing like that in Holloway Road. This is going back to Budgens’ flexibility and being open to new ideas.”

Key role

The store’s 26-space car park will also play a key role in the outlet’s development. It is currently in need of refurbishment, but when it is completed, the car park will open up the store to a wider catchment area, particularly to those people living in the more prosperous Highgate and Crouch End areas of north London.

As a result, the store will be able to advertise itself to a wider market and that should also help to build on the current average basket spend of £7 to £8. “With car parking, that will increase,” says Bhattessa.

“There is a lot of single occupancy in the area and they tend to shop more often. It’s very much top-up shopping here.” He says such a development will allow the store to offer a larger premium food range, including more organics, Fairtrade products and fresh produce. A full working car park will also allow the store to start up a wine club, offering wine by the case. It is a happy coincidence that one of Budgens’ main suppliers is wine giant Constellation Europe and its Cellar Door fine wine range.

“Wine is something we want to develop,” he says. “Given the limited amount of space we have, we want to do home delivery as well.”

Sunday opening

A more immediate improvement to the store will include the installation of an ATM cash machine, while the store has also applied for a lottery terminal. Bhattessa says: “It’s about developing the product in the spring.” Bhattessa also hopes to persuade Islington Council to relax the restrictions on Sunday opening. Even though the store is just under 3,000sq ft, the original planning permission restricted Sunday opening to 9am to 5pm.

The Budgens store the two businessmen took over in East Finchley in October 2007 is bigger, at 5,000sq ft, than the Archway outlet and a store re-fit is on the cards. But the partners are now looking forward to their next retail projects. “We will aim for more stores for sure,” says Bhattessa.

Ideally, they are looking to grow their retail empire in north London.
Bhattessa says that when they were about to open the Archway outlet, local residents had a “positive image” of Budgens because of the East Finchley store and Andy Thornton’s outlet in Crouch End.

“There is going to be a cluster of stores of a similar standard to drive the [Budgens] message,” he says.

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