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Home»Associations»How GST Regime Is Pinching The Restaurant Business In Trichy
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How GST Regime Is Pinching The Restaurant Business In Trichy

Swaminathan BalasubramanianBy Swaminathan BalasubramanianJanuary 16, 2025No Comments6 Mins Read0 Views
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-U.Bharath (cbedit@imaws.org)

Trichy District Hotel Owners Association (THA) is one of the oldest in Tamil Nadu. Starting in 1944 with just 7 members, the association now boasts over 160 members. Aiming to scale new heights in the restaurant business in the Rock fort city, which is a hugely popular religious and tourist centre, and situated in the geographical centre of Tamil Nadu, the THA strives to modernize the kitchen, empower the unorganized workforce, and extend charity to the needy wards of the workers by way of educating them.

In an exclusive chat with Kitchen Herald, S. Sundaresan, Secretary of the of the Trichy district Hotel Owners Association (THA) speaks on various aspects of running the restaurant business. Edited excerpts.

How has the restaurant business evolved  in the last few years in the Rock Fort City, and what role has THA played in it?

Sundaresan: Trichy City is a transit point, and we have a large floating population. It is also a religious centre with the world-famous Sri Ranganathaswamy temple at Srirangam, the Shiva temple at Thiruvanaikaval and the Rock Fort temple, which are situated well within the city.  Over 100 restaurants in these areas have witnessed a phenomenal year-on-year growth and they are doing brisk business. Particularly, restaurants in Srirangam, Rock-fort-Teppakulam and the city junction areas are on a good growth graph, thanks to devotees from all over Tamil Nadu and India.

For example, the ongoing “Vaikunda Ekadasi” festival will be attended by 2.5 lakh devotees, who will descend on Srirangam on January 10 to witness the opening of ”Paramapada Vasal”. Also, the phenomenal business growth of restaurants situated on the many national highways, surrounding the city is something to be taken pride of.

For example, restaurants in Trichy- Chennai, Trichy –Madurai, Trichy-Thanjaur and Trichy- Dindigul national highways have been getting good footfalls and customer support, more so with the onset of Sabarimala season.

Could you elaborate on the role of THA in inspiring positive changes in the way the restaurant business is run in the city?

Sundaresan:  We are encouraging our members to adopt to best practices of the restaurant industry including modernizing the restaurant kitchen. In recent times many restaurants have converted to induction and solar stoves from gas, even as firewood has already become redundant as it is polluting.

In the meanwhile, we, in the restaurant business, are eagerly waiting for the introduction of Compressed Natural Gas (CNG) pipelines, an initiative waiting to be implemented by the Government. This measure, when introduced would be cost- effective and it benefit the restaurant owners.

What are the steps and measures being taken by THA to adhere to the best practices in the food industry?

Sundaresan : There are over 35 governing laws that regulate our operations. Acts such as the Food Safety and Standards Act, 2006, Tamil Nadu Catering Establishments Act 1958, The Minimum Wages Act, 1948 and The Tamil Nadu Labour Welfare Act, 1972, are to be adhered to in letter and spirit.

To educate and enlighten our members on these vital laws, the THA conducts periodical workshops and sessions every three months, to update them on recent developments in the food sector. Not only do we pay our staff as per the rules including extending them ESI and EPF benefits, but we also ensure the Minimum Wages Act is strictly adhered to. While a bearer is paid a minimum wage of Rs.12,000 a kitchen staff gets Rs.30,000 per month in all the restaurants.

Unethical business practices such as the reuse of cooking oil, and ensuring cleanliness and giving them a good ambience are also prioritized. As the customers are expecting introduction of  new menu items and aesthetic ambience to dine in, we are concentrating on that front too.

Could you please elaborate on the needs of the unorganized workforce engaged in working in the restaurants?

Sundaresan About 50,000 workers are engaged in the restaurants in Trichy district.  Sadly, the workforce is one of the many in the unorganized sector, which affects them in so many ways and robs them of many government-sponsored benefits.

We are eagerly looking forward to the future, with fervent hope, when the restaurant workers join the organized sector. This measure would help them to reap all the benefits from the government including paid leave, sick leave, defined work hours, and job security.

As per women empowerment and their growing participation in the workforce, we employ about 30% to 40% of women for jobs such as service, cleaning, billing and kitchen helpers.  I would say that women workers are more disciplined, dependable and trustworthy. We strive to improve their lot and want to engage more of them so their families may get a stable income.

 

Have you initiated any charitable measures for the benefit of the unorganized workforce in the restaurant business?

Sundaresan: Yes, we have taken forward an initiative to give education to at least two of the needy children of workers from every one of our member restaurants in THA. So far, a good 400 boy and girl children have been educated under this initiative. We meet all the educational expenses of both school and college–going children of our workers. This is a small gesture for the welfare of our workers, who work tirelessly in their jobs, all the year.

How far the GST regime has affected the restaurant business, and does it have any adverse effect on the profit margin?   

Sundaresan: Earlier we used to pay only 2% towards sales tax, but with the advent of GST  regime, we are paying a consolidated tax of 5%, which is very much pinching on us and it makes a huge dent in net profit. For example, if we pay a rental of one lakh, we have to dish out 18% GST, which makes out to Rs.1.18 lakhs

 What is the new trend you have witnessed in the restaurant business in the Trichy district?

Sundaresan: I could say that in the post-COVID-19 scenario, there is a great mushrooming of Non-vegetarian outlets in the city and in the district. Some of them have their own in-house slaughterhouses too. But most of them are unwilling to join the THA, for reasons best known to them. I wish they join hands with THA to streamline their operations.

How is the quality control maintained in the restaurants attached to THA?

Sundaresan: Perishables like vegetables are used on the day itself. Moreover, maintenance of store room is important and only quality items are procured and used in our member restaurants. Officials from the Tamil Nadu Food Safety Department also make periodical inspections to guarantee food safety, and a reporting mechanism is already in place for reporting any malpractice.

Rock Fort City S. Sundaresan THA Trichy District Hotel Owners Association
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