PRO­CESSED & PACK­AGED FOODS

Progressive Grocer (India) - - Front Page - By San­jay Ku­mar

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

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