READY-TO-EAT FOOD RESONATES WITH THE YOUTH

Progressive Grocer (India) - - Category Watch Processed Foods -

The In­dian food pro­cess­ing in­dus­try ac­counts for 32 per cent of the coun­try’s to­tal food mar­ket, one of the largest in­dus­tries in In­dia and is ranked fifth in terms of pro­duc­tion, con­sump­tion, ex­port and ex­pected growth. It is be­lieved that the Food Pro­cess­ing in­dus­try will be a $25 bil­lion mar­ket in In­dia by 2020. Out of which, the ser­vice­able metro mar­ket is ex­pected to be close to al­most $20 bil­lion. The past cou­ple of years have seen a tremen­dous growth of this seg­ment due to high con­sumer ac­cep­tance for con­ve­nience food na­tion­wide. A re­cent sur­vey done by As­socham (As­so­ci­ated Cham­ber of Com­merce and In­dus­try of In­dia) says about 79 per cent of In­dian house­holds to­day pre­fer to have in­stant food due to time con­straints. With two work­ing par­ents and fam­i­lies be­com­ing nu­clear, peo­ple pre­fer au­then­tic, nu­tri­tious store bought op­tions rather than spend­ing hours in the kitchen af­ter work. In re­cent years, the fo­cus of the ready-to-eat mar­ket has grad­u­ally shifted from just homemak­ers or stu­dents to young pro­fes­sion­als and fam­i­lies. It is found that 76 per cent of par­ents in big cities, mostly both work­ing with chil­dren un­der the age of five, are serv­ing easy-to-make meals in some form or the other, at least 10-12 times ev­ery month! No won­der that the RTE mar­ket con­tin­ues to ex­pand at a brisk pace. The mar­ket for spreads, sauces and dips is now close to $2 bil­lion and grow­ing at 22% CAGR. The RTE meals mar­ket is cur­rently valued at INR 23 crore. It grew at a com­pounded an­nual growth rate of 3-5% in the last five years. Ac­cord­ing to data re­search com­pany Nielsen, the break­fast mixes mar­ket is grow­ing at 17% and is cur­rently pegged at INR 275 crore. How­ever, as fancy as the var­i­ous break­fast ce­re­als avail­able in the mar­ket might be, we crave the sat­is­fac­tion that only a tra­di­tional dish can give. And hence tra­di­tional brands are com­ing up with op­tions that are suit­able for the In­dian palate. The tra­di­tional brands such as ITC and MTR have for­ayed into items such as bhel bar, pot upma, poha, which can be had on the go, any­time, any­where.to ful­fil the de­mand of this large sec­tion of con­sumers, one will find a lot of new RTE brands in the mar­ket. Un­like the gi­ant brands though, the new en­trants are try­ing to cre­ate a niche cat­e­gory for them­selves, be it break­fast ce­re­als, canned, frozen foods, spreads, chut­neys, and so on. Com­pa­nies are look­ing to at­tract con­sumers within ar­eas like olive oil, spreads and ready meals by of­fer­ing pro­mo­tions, new prod­uct de­vel­op­ments, health & nu­tri­tional ben­e­fits and at­trac­tive pack­ag­ing. The In­dian con­sumer be­hav­ior has been in­flu­enced by ex­po­sure to other cul­tures primarily in the West through trav­els, and pop­u­lar lit­er­a­ture. The ready-to-eat mar­ket is some­what sat­u­rated in the West, hence devel­op­ing coun­tries like In­dia are at­tract­ing the ma­jor­ity of big play­ers with the prom­ise of a high growth op­por­tu­nity. The boom­ing food sec­tor, mul­ti­ple food out­lets, the pop­u­lar­ity of in­ter­na­tional brands and dis­tinc­tive dis­tri­bu­tion chan­nels adopted by play­ers are ex­pected to help the mar­ket grow at a con­tin­u­ous pace. Con­sumers are in­creas­ingly re­al­iz­ing that ma­jorly RTE foods are loaded with preser­va­tives for a longer shelf life. In­creas­ing health aware­ness, par­tic­u­larly in the young gen­er­a­tion, is hin­der­ing the growth of this mar­ket. Still a large In­dian pop­u­la­tion is price sen­si­tive and there­fore the price fac­tor of RTE food makes them af­ford­able only to se­lect eco­nomic classes of the so­ci­ety. Hence it be­comes all the more es­sen­tial for new play­ers in this field to marry con­ve­nience with health ben­e­fits to en­sure con­ve­nience food does not mean com­pro­mis­ing on qual­ity. The key is to pro­vide RTE food op­tions fo­cused on In­dian taste for ev­ery­day con­sump­tion, which are not harm­ful in the long run. This is the chal­lenge taken up specif­i­cally by food tech start-ups who want to be con­sid­ered as se­ri­ous play­ers and are get­ting into the game af­ter years of R&D. With state-of-the art tech­nol­ogy in pack­ag­ing and pro­cess­ing to en­sure the end prod­uct is not just a world class prod­uct that can even­tu­ally be on the shelves in coun­tries across the globe but a prod­uct that is a strong con­tender in be­ing a game changer.

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