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How a vegan restaurant mixes business and advocacy

The food is not only healthy, so is the pricing strategy
By Entrepreneur Staff |

In June 2000, a quaint restaurant opened its doors at a quirkily named place, Krus na Ligas, in Quezon City. Close to 11 years now, Likha Diwa has been offering vegetarian food to a mixed clientele of students, families, and young professionals living in and around the University of the Philippines-Diliman campus.

In about two years, Likha Diwa was able to pay off its debts, says Dell Castillo, one of the restaurant’s owners—a very good thing indeed for a single-unit enterprise offering a niche line of food items within a university campus.

Castillo, who has been managing Likha since 2006, does not follow a single formula when pricing the items in Likha’s menu. “Sixty-five percent mark-up, ‘yun daw ang ideal sa food business, pero hindi namin ‘yun nagagawa. Ibinabagay mo pa rin yung presyo mo sa kakayahan ng mga kumakain dito. (We were told the ideal mark-up for a food business is 65 percent. But we are not able to do that here. You still have to set your prices according to the paying capacity of the people eating here),” she says.

Consequently, Likha has value meals and rice toppings priced for student market, at less than P100 a serving. Its noodle dishes and rice platters, on the other hand, are priced between P100 to P150 a serving, with young professionals and families in mind. A complete meal of appetizer, soup, drink, entrée and dessert at Likha would set one back by P350 to P400. But with about P250, one would already get a decent vegetarian meal.

A rule of thumb Castillo follows in determining the prices of Likha’s offerings is that items that require more preparation should be priced more than the others. These items include Likha’s signature vegetarian paella (P150), seafood kare-kare (P125), and the pinaputukang tilapia (P125).

In its decade of existence, Likha has adjusted its prices sparingly, timed with the introduction of new menu items. Rather than resorting to frequent price increases, Castillo opts to absorb the loss when prices of the raw ingredients go up. Castillo says: “You are at the mercy of the suppliers—‘di ko mababago yung presyo, at times palugi. Pero pag mababa ang presyo, makakabawi ka. (I can’t change the prices of the dishes; at times, you have to operate at a loss. But when the prices of goods in the market go down, then you could recover your losses.)”

As much as possible, Castillo sources her ingredients from suppliers of certified organic products, specifically vendors at the Sidcor market held every weekend at the Eton Centris in Quezon City and the Landmark grocery in Quezon City. She also has a preference for buying from small backyard growers of vegetables. “’Di problema ang pag-so-source (sourcing organic ingredients is not a problem),” she says.

For its lunch service, Likha serves about eight tables of four to five persons each. For supper, it serves about 10 tables. For a restaurant with a seating capacity of 50, these numbers are good, good enough to sustain an advocacy of healthy living, which accounts for much of Castillo’s motivation in keeping Likha Diwa running.

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This article was published in the April 2011 issue of Entrepreneur Philippines.

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