Reality of Food Business in India | Sagar Daryani on Wow! Momo, Zomato & Franchises

The Indian food and restaurant business looks glamorous from the outside, but behind the scenes it’s one of the toughest industries to survive in. In this conversation with Raj Shamani, Sagar Daryani, co-founder of Wow! Momo Foods, shares the hard realities of building a food brand in India — from navigating 32+ licenses to competing with delivery giants like Zomato and Swiggy.

With Wow! Momo now valued at over ₹4,500 crore and expanding into Wow! China, Wow! Chicken, and Wow! Kulfi, Sagar explains what it really takes to build a profitable food empire in India.

Podcast Summary

Q1. Is it really true that it takes more licenses to open a restaurant than to buy a gun in India?

Yes. Sagar explains that while India requires about 13 licenses to own a gun, opening a restaurant often means navigating 32 different licenses — food safety, trade, health, music, labor, establishment, and more. This creates a massive burden for entrepreneurs, often eating up nearly 60% of earnings in taxes and license fees.

He stresses the need for “one nation, one regulation”, so restaurant owners don’t have to repeat the licensing process state by state. While some progress has been made with single-window clearances in states like Gujarat and Hyderabad, the reality is still filled with red tape and harassment.

Q2. What are the biggest mistakes people make when starting a small restaurant?

According to Sagar, many new founders underestimate the importance of location, simplicity, and product quality. He says food retail is all about location, location, location. If people don’t see you, they won’t come.

He also stresses not to overcomplicate menus. Simple food that consumers instantly understand (like Wow! Momo or Pizza Hut) works best. Many entrepreneurs fail by choosing confusing names or complex offerings that don’t resonate with customers.

Q3. Why would someone pay ₹100–200 for a momo when street vendors sell them for ₹20–50?

Sagar believes it comes down to quality and trust. At Wow! Momo, a chicken momo contains proper boneless leg meat, while street food often compromises with unsafe ingredients — sometimes even linked to dog meat scandals.

Consumers are willing to pay a premium for hygiene, consistent taste, and brand trust. This is how Wow! Momo positioned itself successfully, transforming a roadside snack into a national brand.

Q4. How tough is the restaurant business compared to other industries?

Sagar calls it one of the most ruthless industries. Out of 20 restaurants that open in an area, only a handful survive, while the rest burn cash and shut down. It’s high-risk because margins are tight, customer preferences shift quickly, and rentals keep rising.

He adds that entrepreneurs often glamorize the idea of running a restaurant without realizing the back-end challenges — compliance, licenses, manpower, and cutthroat competition.

Q5. How much commission do Zomato and Swiggy charge restaurants?

Delivery aggregators typically charge between 15–25% commission per order. For many restaurants, this eats into already thin margins.

Sagar believes restaurants must balance between online delivery and offline formats like dine-in, pickup, and food courts. He says relying only on delivery is unsustainable because of the high commission and packaging costs.

Q6. What role has franchising played in scaling Wow! Momo?

Franchising has been a key growth engine, but Sagar warns that it works only when backed by solid SOPs (standard operating procedures) and strong brand control.

He shares that Wow! Momo carefully selects franchise partners, supports them with training, and ensures quality consistency. Without this, a brand risks collapsing under its own expansion.

Q7. How much capital does it take to start a small food outlet today?

Sagar says what used to cost around ₹30,000 two decades ago now requires at least ₹5 lakh due to inflation, rentals, and compliance.

Whether it’s a food truck, kiosk, or mall outlet, the location must guarantee visibility and footfall. “What is seen is sold,” he explains — a principle that guides Wow! Momo’s expansion strategy.

Q8. What are the three pillars of success in the food business?

For Sagar, it comes down to three essentials:

1. Product – Great taste and quality.
2. People – Skilled, trained staff who maintain standards.
3. Place – Right location with steady traffic.

He insists that if you crack these three, scaling becomes much easier.

Q9. How important is reinvention in the food business?

Sagar says SOPs that work for one outlet won’t work for five, and those for five won’t fit 50. Every stage of growth requires constant reinvention.

Entrepreneurs who think they’ve “cracked the system” often fail because they stop innovating. Agility and adaptability are crucial for survival.

Q10. How did Wow! Momo handle negative perceptions around momo quality in India?

When momo scandals linked to dog meat hit the media, Wow! Momo also suffered because of consumer distrust. But by openly highlighting their use of trusted suppliers like Amul dairy and quality chicken, they rebuilt consumer confidence.

Transparency and brand storytelling helped them distance themselves from street-side momos and maintain customer trust.

Q11. How did you identify the “cuisine gap” in India?

Sagar explains that India’s food industry thrives when you find a category that is popular but unbranded. Wow! Momo identified momo as a rising street food and branded it nationally.

Later, they repeated the model with Wow! China, Wow! Chicken, and Wow! Kulfi, turning roadside favorites into branded QSR experiences.

Q12. What future cuisine gaps do you see in India?

According to Sagar, three untapped opportunities are:

• A standardised QSR biryani chain.
• Korean cuisine, fueled by K-pop culture.
• Sushi QSR format, making it affordable and scalable.

He also sees potential in kiosk coffee models and bubble tea formats, given India’s rising café culture.

Q13. What’s the difference between cloud kitchens and pickup-and-go models?

Cloud kitchens only serve delivery, making them invisible to walk-in customers. Pickup-and-go formats, on the other hand, combine visibility with affordability by operating in small kiosks with high efficiency.

Sagar believes this hybrid visibility makes pickup-and-go a stronger long-term play in India.

Q14. How is the Indian eating-out culture changing?

Cloud kitchens only serve delivery, making them invisible to walk-in customers. Pickup-and-go formats, on the other hand, combine visibility with affordability by operating in small kiosks with high efficiency.

Sagar believes this hybrid visibility makes pickup-and-go a stronger long-term play in India.

Q15. What is your ultimate vision for Wow! Momo?

Sagar dreams of building Wow! Momo into a global brand, already expanding to Dubai, Nepal, Bangladesh, and Thailand.

He says his goal is not just personal wealth but to be a game-changer in India’s food industry, creating jobs, scaling brands, and proving that Indian QSRs can compete globally.

Conclusion

The food and restaurant business in India is full of opportunities but also loaded with challenges from licenses and aggregator commissions to constant reinvention. Sagar Daryani’s Wow! Momo journey proves that with vision, discipline, and the right product-market fit, Indian brands can not only survive but dominate. His story is a reminder that passion for food must be matched with strong business acumen to scale sustainably.

For aspiring entrepreneurs, the key lessons are clear: simplify the menu, secure the right location, build trust through quality, and adapt constantly. The future of Indian QSRs is bright, and those who execute with focus can build the next Wow! Momo.

🔥 Inspired by Sagar Daryani’s journey? Learn more about scaling food brands, cloud kitchens, and franchising in our Franchise Business category.
🎥 Watch the full podcast episode with Raj Shamani and Sagar Daryani on YouTube here.

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