Saturday, July 31, 2010

Making Sense of Shalimar SF Restaurant story ... San Francisco Bay Area ... Pakistani & Indian Cuisine

Indian Chatkhara, Fremont, California
The Shalimar Restaurant group is a 15 to 20 year old chain of Restuarants from the San Francisco Bay Area. Recently they've under gone a major re-org where one store has apparently been sold and a new store under a new brand opened. 

Recently, while trying to get a quick bite at Chatkhara Restaurant I was surprised to learn that this is essentially Shalimar.  

I inquired with the person in charge at Chatkhara on what's the deal with the new name. His reply, in Urdu was: "is key peechey kahani hai" -- meaning to say "there is a story behind this."

That said, Shalimar now has 5 entities:

2 in San Francisco branded as "Shalimar"
1 in Sunnyvale branded as "Shalimar"
1 in Fremont called "Shalimar"
1 in Fremont branded as "Indian Chatkhara"

Interestingly when I first went to the Shalimar Restaurant in Fremont they informed me that they were closed and I should go next door to Chatkhara as that's also their store. 

My initial assumption for the new branding has something to do with Taxation matters. Which doesn't surprise me as after all they've had a Cash Only policy. Implying that,  more than likely they've been under reporting there actual income.  Given there rapid growth over the past 15 years I wouldn't be surprised if they're on some  sort IRS watch-list. 

Based on this assumption one could easily explain the reason for the name change. However, that still doesn't explain their divestment from the Sunnyvale entity, that is if the Shalimar group has indeed sold it. As folks at the Fremont Shalimar and Chatkhara claim that they've sold the Sunnyvale entity, however Sunnyvale entity folks deny their claims. Although the "Shalimar Group" website does not list the Sunnyvale entity, which could mean they've sold that store -- however what about the brand? Have they sold the rights to the "Shalimar" brand as well, or have some sort of co-use branding arrangement? 

One other interesting differentiation to note between  Shalimar and Chatkhara is the latter except credit cards. 

Which points back to my initial assumption where the Shalimar entity, due to it's growth has come under IRS scrutiny, and so the reason for them to divest and re-brand. Though, I don't buy the divestment story. I think it's safe to assume that the divestment is within the Shalimar Group as a short term strategy to clear any record that may exist with the IRS. With their long term strategy leaning towards an all out re-branding and name change from Shalimar to Chatkhara.

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