Dhandho Maxing Restaurants with Aakarshan Harlalka – Flywheels
Every spike in orders triggers a reaction somewhere else — in operations/Kitchens,finance, delivery logistics, or algorithmic ranking. In part 4, Aakarshan of AdvanceX and I whiteboard the business into a causal loop diagram. This piece will make you realize how a business isn’t just a spreadsheet — it’s a living organism.
Why it matters: Operators who see only surface metrics—impressions, clicks, or average order value—miss the system beneath.
We brainstormed multiple loops of consequence. Each loop is simple; together they form a complex adaptive system. They are:
- Growth Flywheel: How visibility and ad spend convert to demand.
- Kitchen Operations Drag: How kitchen capacity and operational inefficiencies throttles growth.
- Margins: How cash delays and discounts constrain reinvestment.
- Menu Engineering: How menu design drives average order value.
Let’s dive right in.
Loop #1 – Growth
This flywheel is operated by the growth team and compounds—until one of two brakes hits:
- Ad marginal returns fall (CPC rises faster than conversion)
- Reputation slips and conversion collapses.
Using discounts and ads to mask weak reliability flips the loop into a death spiral: each extra rupee buys less demand while service strain worsens ratings further.
Eventually, ads amplify both strength and weakness. Scaling spend before fixing reliability is like opening a wider tap on a leaky pipe. The leak only grows.
Leverage points:
- Positioning
- Great customer experience
- Great ordering experience
Loop #2 – Kitchen Operations
The ‘Growth Flywheel’ assumes frictionless execution. Kitchens are nonlinear systems—double the load doesn’t mean double the output. Once capacity hits 85–90%, delays explode. A 10-minute delay can push rejection rates from 3% to 12%, instantly erasing gains from ‘Growth Flywheel’. The system self-balances but painfully: through customer loss and complaint cost.
The goal is not zero delay; it’s predictable delay. Aggregator algorithms punish volatility more than slowness.
Why it matters: You want to avoid entering a reputation death spiral. Advertisements and discounts outpace kitchen throughput. Ratings collapse from delays; impressions fall; ad cost per conversion doubles; operator compensates with discounts, accelerating decay.
Leverage points:
- The rational short-term fix is to know your kitchen’s throughput and increase throughput per hour.
- Simplify menu to reduce preparation variance
- Forecast demand and unlock efficiencies for a better KPT and product consistency
Without such governors, growth converts to chaos.
Loop #3 – Margins
The next big balancing loop concerns margin management. Discounts and advertisements drive short-term orders but compress margin. Lower margins reduce available cash, constraining budgets for branding,, kitchen improvement, and expansion.
Healthy operators treat discounts as ignition fuel, not flight fuel. Once organic ratings take over discovery, discounts should taper by elasticity testing: measure ΔDiscount/ΔOrders daily.
Loop #4 – Menu Engineering
Operators often treat menu mix as culinary art. In truth, its leverage. Small shifts in bundle design (e.g., combo pricing or item pairing) change not average order value (AOV) but also ROI from advertisements and directly impact margins.
Why it matters: When AOV stagnates, even a strong top-funnel cannot scale profitably. You end up buying volume, not yield.
Other loops
While there are many more loops that seasoned operators keep in mind, the core idea is that the business is a complex adaptive system: a mesh of loops oscillating around temporary equilibriums. That’s why linear “growth hacks” often backfire—the perturbation ripples through unseen feedback paths.
But it missed two factors.
First are externalities:
- Capacity ceiling: each kitchen has a real throughput limit.
- External shocks: weather, festivals, or sudden delivery partner unavailability.
- Competitive pressure: rival promotions alter visibility without any operational change.
Second is the human layer.
- Kitchen staff morale influences delay variability. Complaint handling quality affects whether a dissatisfied customer becomes an evangelist or a defector.
- When operators treat humans as nodes, they miss nonlinear amplifiers. A single great recovery interaction can yield a 5-star rating worth thousands in organic reach. The math bends toward culture.
- System thinking doesn’t replace empathy—it scales it. You institutionalize care so it propagates like any other feedback.
Key insights
Once you start thinking in loops, every metric becomes a signal, not a silo.
Marketing should follow, not lead, operations. Ad spend without throughput is self-defeating. Integrate real-time kitchen load data with ad automation so campaigns throttle when prep time crosses safe thresholds.
Retention is the invisible margin. Repeat customers turn volatile aggregator economics into stable income. Track repeat ratios per outlet, not just per brand.
Liquidity determines survival velocity. Build a minimum two-week cash buffer or negotiate faster aggregator settlements. Without it, the liquidity loop caps growth no matter the demand curve.
Platform reliability scores matter more than ratings. Audit backend metrics—on-time percentage, cancellation rate—weekly. These decide algorithmic placement far more than visible stars.
Invest in people systems. Training and morale aren’t soft levers. They directly control the consistency node in the quality loop. The best kitchens invest 2–3% of monthly revenue in structured training; the ROI shows up as fewer complaints and better retention
Key takeaway
Online delivery isn’t just about demand capture. It’s system navigation. Growth, liquidity, and reliability are parts of one circuit. The operators who learn to read that circuit—who throttle marketing, manage cash lag, and protect quality loops—will shape the next decade of Indian FnB consumption.
Want to republish it? This post was released under CC BY-ND — you can republish it as is with the following credit and backlinks: ‘Originally published by Ritvvij Parrikh on The Times of India. The author retains the copyright and any other ancillary rights to the post.
Disclaimer
Views expressed above are the author’s own.
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