PROCESSED & PACKAGED FOODS
Busy lifestyles and rising demand for health and convenience are catalyzing a growing uptake in packaged food over unpackaged alternatives
India, as a country, has progressed from scarcity to surplus in food during the past decade or so. The progress has resulted in an increased trade in the production of food commodities which, in turn, has paved the way for the food processing industry to grow and become profitable. At the same time, the demands of the accelerated lifestyles of younger urban consumers and their relatively high levels of health and hygiene awareness are set to be key factors in the growing uptake in packaged food over unpackaged alternatives.
Already, one of the largest food producers in the world, India is estimated to double its food production over the next 10 years. The increased production is expected to attract huge investment, not only in the form of capital, human resources and skill development, but also in processing technologies, equipment and financial areas. The fast rising food segments benefiting from this growth will be fruits & vegetables, fisheries, milk & milk products, meat & poultry, alcoholic beverages, soft drinks, packaged/ convenience foods, health foods & supplements and grains. According to Ministry of Food Processing Industries Annual Report 2015-16, the country’s food and beverage market was estimated to be USD 448 billion in FY16, growing at 9.5%. It contributed 9-10% of manufacturing GDP in India in FY 17 and employed 1.7 million people in 2012-13. Of the overall food and beverage market, the packaged food segment emerged as the fastest growing food segment with double digit growth. However, the Report noted that only ~10% of agri-produce is being processed in India and so experts foresee an immense improvement in the areas of specialty processing, packaging, frozen food, refrigeration and thermo processing. Industry Size and Construct: IBEF estimated the food processing industry in India at Rs. 16,51,200 crore (USD 258 billion^) in 2015. Growing at a CAGR of 13.3 per cent, the industry size will be Rs. 30,84,800 crore (USD 482 billion^) by 2020. The organized share of food processing sector is estimated at 25 per cent, dominated by the segment of rice mills; around 42 per cent of the sector is unorganized whereas 33 per cent is operated by small scale industries. The sizeable presence of small-scale industries points to the sector’s role in employment generation. Though a larger share falls under the unorganized sector, the organized sector has a larger share in the secondary processing segment than the primary one. Economic Perspective: A well-developed food processing sector with a higher level of processing helps in the reduction of wastage, improves value addition, promotes crop diversification, ensures better return to the farmers, promotes employment as well as increases export earnings. This sector is
A well-developed food processing sector with a higher level of processing helps in the reduction of wastage, improves value addition, promotes crop diversification, ensures better return to the farmers, promotes employment as well as increases export earnings.
also capable of addressing the critical issues of food security, food inflation and providing wholesome, nutritious food to the masses. The food processing sector has emerged as an important segment of the Indian economy in terms of its contribution to GVA, employment and investment. The sector constitutes as much as 8.4 per cent of GVA in Manufacturing and 9.54 per cent to the GVA of Agriculture sector (2015-16). The annual growth rate of GVA in food processing industries sector during 2015-16 was 7.00 per cent against average growth rate of GVA in agriculture of 1.26 per cent. Employment Generator: The food processing industry is among the key contributors to employment generation in the country. The sector acts as the next natural destination for the workforce moving away from agriculture to manufacturing, and possessing apt skills and food knowledge. The food processing industry constituted 11.69 per cent of the employment generated in all registered factory sector in 2013-14 followed by textile and wearing apparel sector. According to the latest annual survey of industries (ASI) for 2013-14, the total number of persons engaged in registered food processing sector was 17.41 lakh. During the previous five years ending 2013-14, employment in registered food processing sector has been increasing at an average annual growth rate of 2.25 per cent. The unregistered food processing sector supports employment to the tune of 47.9 lakh workers, as per the NSSO 67th Round, 2010-11 and, by 2024, the industry is estimated to employ 9 million people. Food Processing Value Chain: In the Indian context, food processing includes two types of processing activities:
I. Manufactured processes: If any raw product of agriculture, animal husbandry or fishing is transformed through a process involving employees, power, machines or money in such a way that its original physical properties undergo a change and if the transformed product is edible and has commercial value, then it comes within the domain of food processing industry.
II. Other value-added processes: If there is a significant value addition such as increased shelf life, shelled and ready for consumption, etc. then such produce also comes under food processing, even if it does not undergo a manufacturing process.
From an analytical perspective, food processing can be viewed as different levels of processing – primary, secondary and tertiary. Primary processing relates to the conversion of raw agricultural produce, milk, meat and fish into a commodity that is fit for human consumption. It involves steps such as cleaning, grading, sorting, packing, etc. Food processing industries usually deal with higher levels of processing where new or higher value food products are manufactured. The different stages of processing of food are illustrated in the chart below.
Growth Potential: The rising disposable incomes, a growing middle class, large young population, expanding urbanization and changing lifestyle leading to varied food habits, all have together helped the domestic demand for processed food to grow over the years. While domestic demand is growing, India is simultaneously emerging as a strong economy on the world stage. Exports have grown thanks to India’s advantageous proximity with key export destinations, thereby fetching new clients for processed foods, and widening the global demand for its food products. The new clients, in the emerging markets, are also expanding at a faster rate. With its huge agriculture sector, there is no dearth of raw material for the processing industry, which ensures an uninterrupted supply of crops, livestock, dairy and fishery to the processing units in the country.
The government is also focusing on developing supply-chain related infrastructure, such as cold storage, abattoirs and food parks. Additionally, there are various factors, which are likely to increase the demand for processed food in the coming years. With an expanding food market, food processors and retailers are now in a position to develop the necessary demand for quality and the type of agricultural produce required. They facilitate the flow of market information, technology and inputs to the farmers, which further equip them to tailor their output according to the needs of the market. In the process, the farmers are able to raise their own level of produce, quality standards, income and employment. Correspondingly, the consumer is likely to benefit as there is an increase in the supply of food products with a longer shelf life.
Rise in Demand for Processed & Packaged Foods
Younger consumers offer significant opportunities for manufacturers looking to develop a new consumer base and willing to experiment with new products. Younger consumers tend to be
less established in their purchasing patterns and consumption habits than their older counterparts, partly as a result of globalization and urbanization. They have been quick to let go of traditional lifestyles and adopt technological advancements and change.
Relatedly, they are more brand-conscious and more cosmopolitan in their outlook than older consumers. The diverse Indian population has various needs of food habits that change with taste, culture, staple products, geography, season and many other factors. The constant demand for packaged products originates from adapting to newer food trends and imitating other cultures; this has been witnessed in India since the last few years. Such changeover from traditional to modern cultural environment has been rampant and this continues to create vast demands for packaged food products during the year. How the category of Packaged Foods is defined: Euromonitor International considers the below mentioned categories in its packaged food research:
• Baby Food • Baked Goods • Breakfast Cereals • Confectionery • Dairy • Edible Oils • Ice Cream and Frozen Desserts • Processed Fruit and Vegetables
• Processed Meat and Seafood • Ready Meals • Rice, Pasta and Noodles • Sauces, Dressings and Condiments • Savoury Snacks • Soup
Market research agency Euromonitor considers two aspects of food sales under the packaged food catrgory: • Retail sales. • Foodservice
Retail sales is defined as sales through establishments primarily engaged in the sale of fresh, packaged and prepared foods for home preparation and consumption. This excludes hotels, restaurant, cafés, duty free sales and institutional sales (canteens, prisons/jails, hospitals, army, etc). Euromonitor’s retail definition excludes the purchase of food products from foodservice outlets for consumption off-premises, e.g., impulse confectionery bought from counters of cafés/bars. This falls under foodservice sales. For foodservice, Euromonitor captures all sales to foodservice outlets, regardless of whether the products are eventually consumed on-premise or off-premise.
Foodservice sales is defined as sales to consumer foodservice outlets that serve the general public in a non-captive environment. Outlets include cafés/ bars, FSR (full-service restaurants), fast food, 100% home delivery/ takeaway, self-service cafeterias and street stalls/kiosks. Sales to semi-captive foodservice outlets are also included. This describes outlets located in leisure, travel and retail environments. • Retail refers to units located in retail outlets such as department stores, shopping malls, shopping centres, super/ hypermarkets etc.
The food processing industry is among the key contributors to employment generation in the country. The sector acts as the next natural destination for the workforce moving away from agriculture to manufacturing, and possessing apt skills and food knowledge.
• • Leisure refers to units located in leisure establishments such as museums, health clubs, cinemas, theatres, theme parks and sports stadiums. Travel refers to units located in based in airports, rail stations, coach stations, motorway service stations offering gas facilities etc.
Key Trends in Packaged Foods
Packaged foods have witnessed a healthy growth last year and this year as well. Essential commodities like edible oils, dairy products and alternatives followed by other categories continue to contribute significantly to the double digit growth achieved by packaged foods. Consumers are shifting towards packaged food from unpackaged unbranded products and there is also a rise in premiumization.
Furthermore, competition among bigger brands and improved performance of smaller categories drives the growth of packaged foods. Edible oils and dairy are the biggest categories in packaged foods and has attracted many investments from both international and domestic players. These companies have expanded their existing business and established new manufacturing and processing plants to cater to the demand of consumers and more specifically, meeting the demands of uncaptured markets across India.
Convenience and healthy eating continues to drive sales of packaged foods. The perception of packaged foods is changing among consumers, as there is a significant rise in consumers wanting convenience, availability and affordability to purchase such products. Meanwhile, with the onset of information sharing through various sources
From an analytical perspective, food processing can be viewed as different levels of processing – primary, secondary and tertiary. Primary processing relates to the conversion of raw agricultural produce, milk, meat and fish into a commodity that is fit for human consumption.
like social media, print and others, consumers are more informed about the benefits and downsides of packaged foods, leading to a better informed decision when purchasing products. Health benefits and hygiene have also become increasingly important, as many consumers become calorie conscious and track calorie intake while consuming packaged foods.
This has, in turn, supported the growth of “organic”, “fortified”, “functional” and “better for you” types of packaged food products; however these categories are still at a nascent stage. Necessity, convenience and availability shall drive future growth. The packaged foods market will continue to achieve a double digit growth during 20172022, mainly due to the need and dependence on packaged food, coupled by convenience and availability. Essential commodities like edible oils, dairy, rice, bread and breakfast cereals are an integral part of the daily diet and these will contribute to a constant rising demand. Products like biscuits, savoury snacks, confectionery, spreads, soups, noodles, pasta and ice creams will remain the most dynamic categories to perform well during 2017-2022. Furthermore, improvement in logistics, storage facilities and refrigeration packaged foods will witness higher penetration into rural regions in India. Meanwhile, the rise in healthy living and eating will promote the growth of health and wellness type of products among packaged foods and support the shift to premium products. Packaged food categories fight for consumers’ share of throat: The demand for staples and dairy leads, more than cooking ingredients and snacks, as these are essential commodities. Within these categories, for example, snacks and staples usually compete with each other for consumers’ share of throat, as people constantly keep consuming different products. As a result, it ultimately creates opportunities for packaged food companies to expand, innovate and satisfy the needs of consumers.
Last year, this was evident as one of the many innovations brought in by manufacturers like Nestle Ltd, Britannia Industries Ltd, ITC Ltd and many others was in traditional Indian flavoring for products like snacks, spreads and others. Also, many international companies like Lactalis Groupe SA, Adani Wilmar Ltd, amongst others, are cashing in on the opportune environment in packaged foods, thereby expanding production units and launching new products. Modern grocery retailers slowly gaining share from traditional retailers: Independent small grocers continue to be the largest and the most preferred distribution channel for packaged foods. During 2017, however, there was a minute decline in sales from them compared with madern trade sales of packaged foods in 2016. This was mainly due to competition from hypermarkets, supermarket and
The rising disposable incomes, a growing middle class, large young population, expanding urbanization and changing lifestyle leading to varied food habits, all have together helped the domestic demand for processed food to grow over the years.
internet retailing. Time constraints among working class population in the urban regions in India encourage consumers to buy food at supermarkets and hypermarkets; since these stores have abundance of products available at one destination. Certain cities like Delhi, Bangalore, Mumbai and other major metros have been witnessing independent small grocers expanding their current store to resemble a supermarket by expanding the selling space and stocking more products; this is prominent in places like residential neighborhoods, educational institutions housing students in dormitory and nearby offices. In “non-store retailing”, “internet retailing” has been attracting young crowd to shop for their monthly needs either by shopping through mobile or computer, however “internet retailing” still contributes less than one per cent to the overall sales of packaged foods. Health and wellness becoming increasingly prominent: In 2017, Euromonitor International noted that the rise in consumer health-consciousness is expected to have a significant impact across most [if not all], packaged food categories up to 2021. Health consciousness will be a primary factor in both driving the initial uptake of packaged food and shaping evolving demand amongst Indian consumers. “Edible oils” is set to display both these elements as it continues to benefit from the consumer demand for the security provided by packaged products. This category is also seeing a rising demand for products declaring to have a positive impact on health. The relative affordability of rapeseed oil is expected to encourage hygieneconscious consumers to adopt packaged products as availability increases. Meanwhile, olive oil is set to see a 17% CAGR, as urban consumers perceive it to be a healthier option than rival oils, prompting more players to enter the category and expand distribution.
Awareness of health benefits provided by pro/ prebiotic products is set to contribute towards the expansion of “yoghurt” as a category. These products are typically targeted towards the affluent urban consumers who tend to be more focused on health issues and more capable of affording products with added value health benefits. As such demand evolves, packaged food manufacturers are set to increase their focus on health factors in their marketing
With an expanding food market, food processors and retailers are now in a position to develop the necessary demand for quality and the type of agricultural produce required. They facilitate the flow of market information, technology and inputs to the farmers, which further equip them to tailor their output according to the needs of the market.
and product innovation. There will be a refinement of the health orientated offering, to target precise health concerns, such as problems with the heart and digestive system, obesity, bone and joint pain, depression and anxiety, lack of energy and stamina and sleeplessness. Moreover, major manufacturers and their expansion plans are is likely to propel the “Health & Wellness” type of packaged foods and also trigger demand from smaller cities.
Industry Trends in Food Processing
Burgeoning demand for healthy foods: The demand for processed food, especially healthy ones, is on the rise. People with a fast paced lifestyle wish to have food-on-the-go while avoiding unhealthy food in their diet. Therefore, food processing companies are serving health and wellness as a new ingredient in processed foods, given that health conscious consumers prefer food products with lower carbohydrate content and with low cholesterol edible oils. Examples include zero-per cent transfat snacks and biscuits, slim milk, whole wheat products, etc. ITC’S multigrain Bingo is one such product in the healthy snacks market. Other major companies are also shifting their focus on healthier snacks as the market for healthy snacks is growing at double speed. Fresh produce emerging as niche category: There is a surge in the demand for fruits & vegetables as a result of a shift in healthy consumption. Accordingly, Indian farmers are also shifting production towards horticulture crops to cash in on the growing demand. The trend has also caught up with food companies with ITC entering the veggie segment with Farmland in November 2017. The fresh produce by the company is likely to be sold at 10-15 per cent premium over local market rates. Intensified competition: The entry and setting up of International food companies in India has bolstered the sector’s health. This has happened due to economic liberalization and growth in modern retail. If the former helped make their India entry smooth, the latter provided an appropriate platform to reach and connect with the target consumer markets. Global players like Danone, Nestle, Kraft Foods, Mondelez International, Heinz and many more are today active contributors to the sector’s growth.
There is also a sizeable share of Indian players in the market, which have carved their own niche and are throwing a challenge to global players. The
The demand for processed food, especially healthy ones, is on the rise. People with a fast paced lifestyle wish to have food-on-the-go while avoiding unhealthy food in their diet. Therefore, food processing companies are serving health and wellness as a new ingredient in processed foods.
technical knowhow and product innovation, backed by smart marketing & distribution strategies, have broadened their market exposure. Home-grown Patanjali by Baba Ramdev is a case in point. Growing importance of food packaging: Food packaging has enabled today’s consumers to look for various options, and compare the value offerings thereof, before making a purchase. Packaging has also helped enhance ‘carry-ability’ of products and increase their shelf life. Usefulness to consumers: Consumers have become aggressive in demanding better, safer, and convenient food products and are willing to pay a higher price for the desired products. This has made food companies adopt the strategy of developing the
usefulness of products for consumers instead of the earlier focus on the usefulness of products from a processing point of view. Frozen and processed goodness: Frozen processed foods offer both convenience and nutrition. The increase in the spending capacity and concurrent time-paucity has led to the continuous development of such frozen processed food products as frozen vegetables (e.g. peas, potato, corn, etc.) and nonvegetarian products such as chicken, fish, and meat. Expansion through product innovation: Product innovation is always needed as consumers not only prefer safe ingredients and additives but also useful ones. This creates opportunities for product innovation, specialized products, and product extensions for existing food processors as well as the new entrants. Therefore, it is now the norm for food processing companies to offer value-addition; those who hitherto offered solely milk have now added other dairy products to their repertoire. This helps the processors to not only reduce wastage, but also expand the uses and realize higher returns. In 2015, Bonhomia announced the launch of ‘Boho’ coffee machines, thus becoming the first company to manufacture coffee and tea capsule in India. Direct farmer-farm linkages: Contract farming has been operational in India for a long time now; however, the experience of the private sector players involved therein has been a mixed bag of successes and failures. Largely, it has helped the processing companies, via increasing sales and therefore augmenting their incomes, as well as providing access to better technology and fetching better prices by securing an assured market for Indian farmers. Some of prominent players who have adopted this route of strengthening direct farmer-farm linkages include Nestlé, Pepsico, Venky’s, Milkfed, and Mahagrapes, among others.
Food Processing sub-sector wise Contribution
The food processing factories are classified into 18 distinct sub-sectors dealing in the processing of specialized food product categories. The number of factories manufacturing grain mill products has the highest share, accounting for almost 50 per cent share in the total number of factories. The vast agriculture output in the form of grains provides ample raw material for these large numbers of processing units. Factories manufacturing other (non-specified) food products; grain mill products and those manufacturing cocoa, chocolate & sugar confectionery top the list in the same order in terms of numbers of employees engaged. The maximum output comes from the sub-sectors of grain mill products, vegetable and animal oils & fats and dairy products. Together, they contribute 53.1 per cent of the total output of the food processing sector.
Product innovation is always needed as consumers not only prefer safe ingredients and additives but also useful ones. This creates opportunities for product innovation, specialized products, and product extensions for existing food processors as well as the new entrants.
Investment in the Sector
As per DIPP, the food processing sector has attracted about USD 7.81 billion during April 2000 to June 2017. Foreign Direct Investment (FDI) equity inflows in food processing sector in the country from 2011-12 to 2016-17 (till September 17) have grown at a CAGR of 24 per cent. The government has significantly liberalized FDI regulations, and has allowed 100 per cent FDI in manufacturing of food products through the automatic route and 100 per cent FDI in trading, including e-commerce in food products manufactured and produced in India.
Taking these steps forward, India has recently invited US companies to take advantage of its liberalized foreign investment rules, ready-made infrastructure and improving ease-of-doing-business climate. The Us-based food company Cargill Inc, aims to double its branded consumer business in India by 2020, by doubling its retail reach to about 8,00,000 outlets and increase market share to become the national leader in the sunflower oil category, which will help the company be among the top three leading brands in India. Similarly, Danone SA, Europe’s largest yogurt maker, is focused on the nutrition business in India, which is its fastest growing market in South Asia. It has launched 10 new products in 2017, and is aiming to double its revenue in India by 2020.
India’s food processing industry is experiencing significant growth and boasts of a good existing infrastructure in new Mega Food Parks around the country as well as state-of-the-art cold chain facilities, which are generating interest among investors. In terms of policy support, food processing is recognised as a priority sector in the National Manufacturing Policy (2011). The Ministry of Food Processing Industries (MOFPI) has been set up as a nodal agency for formulation and implementation of policies and plans for the food processing industries. With an overall objective of positioning India as the ‘Food Basket’ of the world, several initiatives have been undertaken with the objective of promoting investments, innovation and bringing best practices. This vision is in line with the ‘Make in India’ initiative of the Government.
The Government of India plans to triple the capacity of the food processing sector in India from the current 10 per cent of agriculture produce and has also committed Rs. 6,000 crore (USD 937.5 million^) for the period 2016-20 as part of the Scheme for Agro-marine Processing and Development of Agroprocessing Clusters (SAMPADA). SAMPADA
is a comprehensive package, which will result in the creation of modern infrastructure with an effective supply chain management from farm gate to retail outlet. It will not only provide a big boost to the growth of food processing sector but is also expected to double farmers’ income, create huge employment opportunities, especially in the rural areas, reduce wastage of agriculture produce, increase the processing level and enhance export of the processed foods. SAMPADA is expected to leverage investment of Rs. 31,400 crore, handling of 334 MT agro-produce valuing Rs. 1,04,125 crore, benefit 20 lakh farmers and generate 5,30,500 direct/ indirect employment in the country by the year 2019-20. The Ministry of Food Processing notified the scheme in May 2017.
Challenges and Outlook
The sector is not free from its own set of challenges. The challenges are at multiple levels and demand their addressing in a holistic manner. One of the key challenges that the processing sector faces today is the major gaps across all stages in value chain. The gaps continue to keep widening in key areas such as product development, innovation, quality and safety standards. The price ecosystem calls for an urgent upgradation in the procurement system, which is heavily dependent on APMC markets. The dependency limits the price achieving rationality, parity and fairness of product in the open market, thereby affecting procurement performance. At the same time, gaps in the link between production and processing not only leads to a loss of opportunity but also hampers the sector’s output & efficiency.
In recent years, India’s food processing industry has gained the status of a sunrise sector and has acquired prominence over the past few decades. The growing availability of raw materials in the primary food sector, ever-changing lifestyles and policy support have consistently given considerable push to the industry’s growth. The food processing sector serves as a vital link between the agriculture and industrial segments of the economy.
The value of agricultural produce can be improved by strengthening this link on the one hand and ensuring remunerative prices to farmers on the other hand. At the same time, the sector is capable of creating a favorable demand for Indian agricultural products in the world market. A thrust to the food processing sector implies significant development of the agriculture sector and ensures value addition to it.
However, currently, it is difficult to get considerable investment for improving rural infrastructure and supply chain from the private sector. Therefore, there should be a significant increase in public investment in areas such as grading and packing centers, controlled atmosphere, storage facilities, testing laboratories, etc. Carefully calibrated subsidies, exploring innovative strategies, empowering rural producers and consumers through better awareness and support to entrepreneurs in terms of technology and training in food processing are some of the ways by which the sector’s extended growth can be achieved.
In recent years, India’s food processing industry has gained the status of a sunrise sector and has acquired prominence over the past few decades. The growing availability of raw materials in the primary food sector, ever-changing lifestyles and policy support have consistently given considerable push to the industry’s growth.
In the pages to follow, we bring you the profiles of some cutting edge brands in the Processed Foods category and what they are doing to offer high value, technology oriented, branded packaged products that deliver convenient meal solutions to consumers.
Hindustan Unilever’s Processed Food Products: Hindustan Unilever Foods is a national player in the processed foods products business with several iconic brands – Kissan, Knorr, Annapurna, Brown & Polson, to name a few. The range of products is across a wide variety of categories like ketchups, jams, soups, noodles, meal-makers, value added sauces, squashes, custard/ baking powders, atta, and salt.
Market Opportunity: India is a developing market with organized players accounting for only 20% of the entire Foods market and per capita consumption <10% of developed economies. With rising disposable incomes and increased consumer awareness, demand for high quality food products will see a huge surge in the coming years across all population strata and geographies. This would be a very big opportunity for companies like HUL, who have the right amount of scale, focus on innovation and bring the highest quality standards to lead the growth in the market.
Key Markets and Customer Segments: Packaged foods have been an urban metro phenomena for decades with only a few categories like biscuits and noodles reaching the rural market. However, the last few years have seen increasing penetration of newer categories in the mid tier urban cities and the time for an innovation to reach these households is now a few months. With access to the same media and content, the lines between the urban and rural consumer are fast diminishing. Further, an explosion of out-of-home eating in QSRS or food courts of malls is increasing the demand to replicate these products at home. Challenges and Opportunities in Processed Food Category: Consumers globally are becoming very discerning with the choices they make when it comes
With rising disposable incomes and increased consumer awareness, demand for high quality food products will see a huge surge in the coming years across all population strata and geographies. This would be a very big opportunity for companies like HUL, who have the right amount of scale, focus on innovation and bring the highest quality standards to lead the growth in the market. – Krishnendu Dasgupta General Manager - Foods
to packaged foods on a wider variety of subjects like calorific value, sugar content, preservatives, nutritional standards, freshness, among other things. This is a fast paced revolution, which is a big opportunity for companies like HUL that are always attempting to provide packaged foods of the highest quality and nutrition standards and with proactive declarations on packs. Additionally, FSSAI is partnering with industry representatives to ensure that Indian consumers are getting the best quality products in the market.
Company and Brand Profile: Darshan Foods Pvt. Ltd. was started in 1996 at Gurgaon, Haryana, for processing meat products, which was sold under brand name Meatzza. The company currently operates three ISO 22000:2005, HALAL & HACCP certified plants in Delhi/ncr and has offices across India in Cochin, Bangalore, Goa, Mumbai, Delhi, Kolkata, Siliguri and Guwahati. The products are sold to a distribution network of over 150 distributors across India. They cater to the cash & carry, organised and traditional retail markets, QSRS, flight kitchens, hotels, restaurants, caterers & institutions. Meatzza products are available chilled & frozen.
Brand’s USP and Differentiator: Meatzza was the first brand to introduce skinless sausages, sliced products, pepperoni, mortadella and other meat products to the Indian Market. Its vacuum packed products, thermoformed tray packs, and other unique packs have been the brand’s hallmark since 1996. It believes in setting quality benchmarks for the business by introducing unique products, innovative packing and unmatched quality coupled with extensive variety and quick delivery to its customers, which sets the brand apart.
Category and Market Forecast: Meatzza has been consistently clocking double-digit growth since its inception. The market seems promising with the consolidation of organised retail, cash & carry and QSR segments. The hotel, restaurant and institution business is also looking up. GST implementation has also helped in standardising retail MRPS across India. Improved logistics, infrastructure, along with targeted communication have been the main drivers of growth in the product category.
Markets and Consumer Segments: Meatzza has seen good growth across India in the urban markets since its inception. With improved logistics and infrastructure, B & C class towns are
Chilled products are the next big segment, which is improving due to better infrastructure, cold chain and improved electricity conditions in our country. The matured West markets, which have a huge meat consumption, have already graduated to that product segment. – Rajiv Jaisinghani Managing Director, Darshan Foods Pvt. Ltd.
also bringing in higher sales for the brand. Meatzza is targeting customers with traditional Indian products like kebabs and samosas, while also catering to European deli customers by adding varieties of sausages, hot dogs and smoked products. Consumer Connect Initiatives: As one of the top players in the product category catering to a niche segment, Meatzza is doing in-store promotions and sampling along with aggressive customer and trade offers to continue expanding rapidly in all markets across India and further accelerate its growth. Challenges: Logistics time, availability of reefer trucks, operational delivery times and restrictions in the cities are a major challenge. Cost of operations and time taken to get from one point to another, within the city and from one city to another, is also a deterrent to further expansion. Logistics growth (reefer trucks, cold storages, highway, and roads) should bring the cost down, which will increase the demand further. Retail and distributions costs should also come down with this improvement, which will drive the demand up. Lower margins will be compensated with improved sales. Roadmap Ahead: Meatzza recently commissioned a new plant, which will bring chilled products in innovative packaging to the Indian market. To maintain and strengthen its leadership position, Meatzza products are being made available across India in all modern and general trade brands along with e-commerce and delivery website operators.
Company and Brand Profile: Fazlani Foods is part of Fazlani Exports, the largest exporters of seeds, pulses, etc. Fazlani Foods is focused on the ready-to-eat product segment and aims to become synonymous with the category. The company is a pioneer in the use of high barrier retortable packaging, and it offers a wide range of ready-to-eat products that come in microwaveable packaging and provide a healthy alternative to fast food and take-away meals.
Product Portfolio: The company’s offerings include curries, rice, combo meals, and seafood in the ready-to-eat portfolio and pickles, chutneys, pastes, etc, in the jar segment. It also has ready cooking sauces in jars. All the items are packaged keeping the convenience factor in mind. The company aims to be a pioneer in the ready-to-eat segment.
Best-selling Products: Dal Makhani in ready to eat curry range, chole with rice in combo meal range and dry fruit mango chutney in jar range are its international award winning and best-selling items.
Category and Market Forecast: The ready-to-eat category is expected to double in size and rake in INR 50 billion by 2023 at a CAGR of 12%. Food manufacturers are looking to adopt better technologies to extend the shelf life of packaged goods and deliver on nutritional fronts as well. The opportunity is vast as with increased awareness, more and more people are accepting the segment. With the growing number of millennials, working professionals, study abroad segment, the category is seeing light in a country where homemade food has its own place and packaged food has lots of myth around it.
Markets and Consumer Segments: West India is a key market and north is a promising second. Thanks to the internet penetration and communicative integration, the rural market too is not beyond for the ready food segment. There is only a little difference between rural and urban markets today. The audience is evolving, although at a slow pace. But, soon all consumers will be drawn in by the need for convenience.
Consumer Connect Initiatives: The company aims to educate the consumers on the myths surrounding packaged food. It will emphasize on the efficacy of the value chain behind packaged food and make it a strong selling factor. It is also focusing on the quality and consistency of its products – from raw material to finished goods.
Challenges: Packaging is the major challenge.
Roadmap Ahead: The company’s mantra is to make its customers spoilt for choice and to delight the consumers on the convenience factor of its products.
The market isn’t static. We need to exploit the market with variety in terms of offerings and variations in the range. Modern Trade needs to focus on this category as an important monthly grocery cycle. There is a huge potential across the retail chain. – Zeeshan Kolsawala Brand Manager
Company Vision and Philosophy: Via Gourmet is a health food company offering sterilized ready-to-eat products (vegetables and fruits) with a stable shelf life in quality packaging. The company intends to address the consumer demand for fresh and nutritious food by focusing on attributes such as ethnic flavor, odor, texture and taste and providing minimally processed foods. Its introduction of fresh-cut, ready-to-cook, ready-to-serve, ready-to-eat processed food products is a step in that direction.
Business Approach and Model: The company intends to work with large QSR chains in India because of their deep market penetration in Tier I and Tier II cities. The growing reach of online sales platform, along with a strong digital push, is helping the company establish connect with its customers. It feels that the traditional distribution model will be vital for expanding the business into Tier II and III cities, with distributors being the key.
Category and Market Forecast: The domestic market requires substantial awareness about the ready-to-eat product category. But it’s an exciting space for Via Gourmet, which wants to connect with people and get them going with the concept of “on the go cup foods”. With online selling platforms playing a major role in reaching customers’ homes, Via Gourmet is equipped with disruptive technologies in food, and is also willing to be patient with the market. Apart from focusing on innovations, it is also building up on its portfolio of generic food products. It has been instrumental in extending the shelf life of these products significantly, besides facilitating distribution and scale accordingly.
Challenges: The agro-processing sector is highly unorganized when it comes to farming. Farmers lack the technical knowledge of crop rotation and the right relationship between the crops and seasons. Another major challenge is that companies lack the knowledge to build food processing units that can trigger changes in taste.
Consumer Connect Initiatives: Via Gourmet is well suited to address the consumer demand for fresh and healthy eating. It has the factory and R&D approach to develop a unique combination of healthy and tasty recipes and unique packaging to bring consumers ready to eat experience like never before.
Roadmap Ahead: Via Gourmet intends to bring about a change in the canning industry by explaining to companies the benefits of multi-layer packaging over canning. Via Gourmet is moving its existing recipes from canned to multilayer packaging and expects the domestic market to become very promising for its products, going ahead.
It’s an exciting space for us to be in and provides us a great opportunity to service and generate demand by innovation and making a difference to the eating habits of the nation. “Eat from the cup” is our motto! – Sumit Jawalkar Director & CFO
‘The Cup concept’ is something we need to focus on. Top retailers can consider private labelling and wield a sustainable eco system with us. This will lead to better revenue optimization for product owners as well as for large retailers. – Nitin Rajadhyaksha Director Technical
Company profile: The Amalgam Group has been a seafood export major and industry leader for over 30 years. Among the many “firsts” to the company’s credit in the industry are: the setting up of first Freeze Drying unit in the country to the launch of the first cold chain logistics and the launch of one of the first frozen food retail brands. The Group has a track record of introducing some of the major food brands in India. Product Portfolio: Amalgam’s Buffet brand of premium convenience frozen food has products in all the five major segments of frozen foods: Indian breads (parathas & naans), sausages & meats, seafood, snacks and vegetables and in ready-to-cook, ready-to-fry and heatn-serve product range. The company’s current range of products has a variety of parathas, naans, sausages, shrimps, frozen fish fillets, breaded products like nuggets, chicken pops, breaded burger patties, breaded fish fillet, breaded fish fingers, spring rolls, kaathi rolls, calzones, kebabs, momos, dimsums and French fries. It recently introduced heat & serve products like a range of Indian curries, fried rice and biriyanis.
Best-selling Products: Malabar paratha followed by green peas, large prawns, chicken sausage and bacon.
Category and Market Forecast: The rapidly evolving Indian lifestyle is opening up a multitude of opportunities for players in the frozen food industry. There is substantial year-on-year growth and brand Buffet, with its range of innovative products, plans to gain maximum market share with wider market penetration.
Markets and Consumer Segments: Brand Buffet products cater to all segment and regions. The products are targeted at housewives, working professionals, students and anyone looking to purchase quality frozen convenience food.
Consumer Connect Initiatives: The brand strives to drive customer loyalty through its quality offerings. Vegetables and seafood products are processed, frozen and packed in a matter of hours. For value-added products, apart from the limited time they take to process and freeze the products, most of the ingredients are sourced from the finest food processors from around the world like Japanese Panko Crumbs used in the range of breaded products or the glass noodles in the spring rolls imported from Thailand. This adds substantial value and assures quality to each product within the respective category, making the product as good as those made at home. Challenges: Frozen food brands are competing to place their products in the limited freezer space available. Without efficient cold chain management, the growth potential will be limited. However, operations in most metros have now become more adequate; it is the suburban areas that need significant improvement. Roadmap Ahead: The company plans to educate the customers on the positives of frozen food. The very essence of frozen food is temperature management. No category justifies e-commerce delivery system more than the chilled and frozen food category due to its temperature management requirements and product handling difficulties in India. To provide frozen food without deterioration of quality due to temperature fluctuations, Amalgam Frozen Foods has set up “Buffet” flagship retail chilled and frozen store at Kochi, Mumbai, and Bhubaneswar. These stores have met with an extremely good response.
We believe Frozen Foods will be the next go-to food source. There is tremendous potential for growth in the sector but growth is limited to efficient cold chain logistics and freezer space available at the stores. The category faces operational challenges in terms of cold chain management, which limit the potential for growth in this sector. – Chandrasekharan COO, Amalgam Frozen Foods Pvt. Ltd.
Company and Brand profile: Originated in Khapuria, Cuttack, in 1976 with an initial investment of only Rs. 5,000, Om Oil & Flour Mills Ltd. – which operates brand Ruchi – has traversed a steep road to success and is now a staple name in every Indian household. The company currently employs over 1200 people and has around 300 products across various segments. The company produces about 300 varieties of ground spices, whole spices, vermicelli, pasta, and frozen foods. Since 2000, it has also started producing new Ruchi rice, vermicelli, Italian pasta, among other products. The company is also the sole holder of the Spice House certificate issued by Spices Board in eastern India and is accredited with Agmark and an ISO 22000:2005 certification as well.
Product Portfolio: After 41 successful years of commanding a profitable business, the company is now one of the leading manufacturers and exporters of quality spices, vermicelli, pasta, noodles, frozen produce, ready-to-eat beverages and noncsd products in the country. From its new division Frozit – a ready to eat food brand – it offers premium quality sooji , dal tadka , kichdi mix , Punjabi tadka and instant biryani at affordable prices.
Markets and Consumer Segments: Consumerism is growing exponentially in rural India. The large and small format stores in B and C class cities are large contributors to the company and brand’s growth.
Category and Market Forecast: For the company, the processed food category is growing at a CAGR of 45% and above each year. The traditional markets are undergoing a change and more and more populace is adapting to processed foods, which were earlier seen as a luxury. Thanks to modern packaging technology, the misconception attached to processed foods about not being nutritious or that they have harmful preservatives, no longer exists. The ready to eat delicacies are being enjoyed by all the age groups, at work or at home. With its tagline Time ki bachat, Eat fresh fatafat, Ruchi’s Frozit see no limitations to its market.
Consumer Connect Initiatives: To cater to the consumer demand for healthy and fresh foods, the company has put in a lot of efforts in marketing communications to communicate the integrity of its products. Technical advances in packaging have helped the company in maintaining quality and freshness. Its communications also lay emphasis on the ease of cooking. The modern-day evolved consumers are more willing to experiment, which is helping the brand to build up brand loyalty for its products.
Challenges; The company has overcome challenges – from preserving food quality to assuring natural taste – and bringing a perfect ready to eat product in the market to cope with today’s busy lifestyles.
Roadmap Ahead: The company is planning to expand in different places but not as a food chain but as a food web, which will be loved by both corporates and homes. To build and strengthen social relations, the company has exciting plans and giveaways for its valuable customers.
For years, we have been serving the Indian market with top quality processed foods. Our customers are growing in big numbers, loving the taste of our food and appreciating the way it’s prepared and served. With such terrific response, we are aiming to come up with more toothsome delicacies to attract more customers and to define our growth in the future. – Rashmi Sahoo Director Om Oil & Flour Mills Ltd