Opportunities in The Indian Food Service Market

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Urbanizing double-income households, changing lifestyles and food preferences are spurring the organized market within the dining out sector. Fast food has become highly palatable to the teens and consumers in their early twenties, with international fast food chains like KFC and McDonalds, Subway, Domino’s Dunkin Donuts particularly popular.
Indian food services industry is estimated to be nearly worth USD 41.3 billion and is growing at a healthy compound annual growth rate (CAGR) of 11%.
The size of Organized Indian QSR market is $0.62 bn, growing at a healthy CAGR of 20% and is expected to reach $1.1 bn by 2017-18.
Indian QSR incluses Cafes, Pizza Outlets, Other International Cuisines like Burgers, Sandwiches, Pubs and Bars, Indian Ethnic Cuisine, Ice Creams, Street Food, Bakeries, Confectionery.

Opportunities in The Indian Food Service Market

  1. 1. OPPORTUNITIES IN THE INDIAN FOOD SERVICE MARKET QSR, CASUAL DINING, FINE DINING, VENDING
  2. 2. SUMMARY •The Indian Food Service Industry is worth $41.3 bn and growing at a CAGR of 11%. It is expected to reach $68 bn by 2018. •The size of Organized Indian QSR market is $0.62 bn, growing at a healthy CAGR of 20% and is expected to reach $1.1 bn by 2017-18. •Delivery segment is a integral part not only of the Indian Food Service segment, but is also common for Grocery stores, Liquor stores, vegetable vendors etc. •Major cities comprise of large workplace clusters and high density residential areas. Young Indian Consumers are highly price sensitive. 18% 40% 31% 11% Age Group Profile of Those Who Eat Out 18 to 20 years 21 to 30 years 31 to 40 years above 40 years
  3. 3. CONSUMPTION EXPENDITURE COMPOSITION, FY 2013 Recreation, Education, 3% Furniture, Appliances, 6% Personal Care, 5% Health, 5% Clothing and Footware, 8% Rent, Fuel and Power, 9% Transport and Communication, 17% Food and Beverages, 30% RETAIL MARKET OUTLOOK, FY2017 0% 5% 10% 15% 20% 25% -10% 0% 10% 20% 30% 40% 50% 60% CAGR(FY12-17) Consumption
  4. 4. 25% OF OUR YOUTH PREFER HANGING OUT WITH THEIR FRIENDS OVER OTHER OUTDOOR ENTERTAINMENT ACTIVITIES Favourite outdoor entertainment activity 13-18 years 19-24 years Gen Next(all youth) Projected base 93,18,951 129,923,462 223,142,413 Movies at Cinema hall 13.90% 16.60% 15.50% Go dancing at discos 0.40% 1.40% 1.00% Pubbing/drinking with friends/family 1.20% 1.60% 1.50% Eating Out 9.70% 10.40% 10.10% Entertainment Parks 4.80% 5.90% 5.40% Shopping/Window Shopping 4.70% 5.20% 5.00% Spiritul sessions/satsangs 5.80% 8.90% 7.60% Watch art & culture performance/events 4.40% 4.10% 4.20% Generally hangout with friends 27.00% 23.80% 25.10% Go for long walks 4.60% 6.80% 5.90% Read in libraries 4.70% 4.20% 4.40% Go on long drives 0.90% 2.30% 1.70% Play favourite sports 8.10% 6.20% 7.00% Going Out/picnic with family 7.20% 8.00% 7.70% Visit Relatives/neighbours 15.70% 16.60% 16.20% None 40.40% 37.30% 38.60% Marketing Whitebook
  5. 5. 73% OF THE YOUTH CONSIDER PRICE THE MOST IMPORTANT CONSIDERATION WHILE MAKING PURCHASES Buying Orientation 13-18 years 19-24 years Gen Next(all youth) Projected Base 93,218,951 129,923,462 223,142,413 Brand Image 64.00% 61.20% 62.40% Price 73.00% 72.70% 72.80% Performance quality 36.50% 37.40% 37.00% Premium/advance features 13.80% 16.40% 15.30% Design And Looks 30.10% 23.90% 26.50% Ease of Usage 25.00% 27.90% 26.70% Shopping Experience 15.70% 17.00% 16.50% Reputation of the Company making the product/service 12.00% 11.70% 11.80% Ease of payment/payment option available 9.60% 9.70% 9.70% What most people around you are buying/using 7.10% 9.60% 8.50% Recommendation by shopkeeper/dealer 5.10% 5.60% 5.40% Recommendation by friends/relatives/colleagues 4.80% 4.30% 4.50% The celebrity endorsing the brand 2.50% 2.10% 2.30% Possibility of buying online 0.80% 0.50% 0.60% Marketing Whitebook
  6. 6. ‘GOING-OUT’ HABITS OF INDIAN YOUTH • Indian consumers, at least those who can afford it, are increasingly dining out, particularly in urban areas. • Eating out has evolved from an occasion driven activity to an occasion in itself. It has become a form of entertainment for consumers today. • Urbanizing double-income households, changing lifestyles and food preferences are spurring the organized market within the dining out sector. Casual Dining and QSR Dominates the Organized Indian Food Service Market Casual Dining and QSR 70% Pubs, Bars, Clubs and Lounges 12% Fine Dining and Frozen Desserts 10% Cafes 8% Total Indian Food Service Market 100%
  7. 7. FOOD HABITS OF INDIAN YOUTH 31% of Indians are vegetarians for religious and cultural reasons while the rest of the population eat fish and meat Hindus, the dominant element of the population, strictly abstain from eating beef Consumption of pork is also limited to a relatively small base Dining out is popular amongst many Indian consumers, particularly in urban areas, facilitated by busier lifestyles and higher levels of disposable income. Indeed, value sales at full-service restaurants have increased steadily in recent years, with consumers largely preferring independent rather than chained venues. It is also becoming more common for some consumers to order food for takeaway to eat at home during the week and then to dine out in restaurants Since a dip in 2009, demand for home delivery/takeaway meals has been increasing steadily, with value sales reaching nearly Rs2.2 billion in 2013. Fast food has become highly palatable to the teens and consumers in their early twenties, with international fast food chains like KFC and McDonalds, Subway, Domino’s Dunkin Donuts particularly popular. Young consumers consider eating at these places to be fashionable, allowing them to feel a part of the international youth culture. The menus in Indian outlets tend to differ from those in other countries with high consumption of beef. There is also high demand for indigenous meals from independent fast food venues Many consumers purchase snacks and other food items from the numerous street stalls and kiosks. Street food like pav bhaji, dosas, pani puri etc are very popular in India.
  8. 8. INDIAN FOOD SERVICE MARKET TIMELINE: KEY PLAYERS • Nirula’s • Haldiram Pre-1950 • Honest Restaurant • Saravana Bhavan • Wimpy 1970s and 1980s • KFC • McDonald’s • Pizza Hut • Domino’s • Café Coffee Day 1990s • Subway • CPK • Papa John’s • Jumbo King • Goli Vada Pav 2000-2010 • Dunkin’ Donuts • Starbucks • Taco Bell • Pizza Express • Sbarro 2014 - present Franchisee Model emerged in mid- 1990s Red – Global Players Blue – Indian Players
  9. 9. GREAT INDIAN ETHNIC CUISINE MEDLEY
  10. 10. INDIAN FOOD SERVICE MARKET • Indian food services industry is estimated to be nearly worth USD 41.3 billion and is growing at a healthy compound annual growth rate (CAGR) of 11%. The Organized Food Service Industry is worth $13.79 bn (approx. 33% of total Indian Food Service Industry) and growing at 17%. • The F&B food service sector in India comprises two distinct market segments: a) Organised – Chain and licensed standalone players across quick service restaurants, full service casual and fine dining restaurants, hotels, bars and lounges, cafes and frozen desert formats b) Unorganised – Dhabas (Roadside restaurants serving as truck stops and serving Indian cuisine), street stalls, halwai (sweet shops), road side vendors, food carts, etc. Category Current Market Share CAGR Expected Market Share by 2017 Organized 30% 12-14% 45% Unorganized 70% 8-10% 55%
  11. 11. FOOD SERVICE MARKET SIZE AND CONSTITUENTS Size of the Licensed Standalone Food Service Market (INR Cr) Size of the Chain Food Service Market (INR Cr) 4,395 6,240 1,320 33,200 1,640 8,415 Café QSR Frozen Dessert/Ice Cream Casual Dine Fine Dine Pub, Bar, Club and Lounge 7,745 10,050 2,330 75,955 2,890 13,550 Café QSR Frozen Dessert/Ice Cream Casual Dine Fine Dine Pub, Bar, Club and Lounge 2013 2018 1,520 5,500 775 3,950 500 540 Café QSR Frozen Dessert/Ice Cream Casual Dine Fine Dine Pub, Bar, Club and Lounge 2013 2018 3,775 16,785 1,560 9,035 1,010 1,085 Café QSR Frozen Dessert/Ice Cream Casual Dine Fine Dine Pub, Bar, Club and Lounge Multiple Sources
  12. 12. AVERAGE SPENDS PER PERSON ACROSS FORMATS (Tickets Size) Unorganized Formats Avg Ticket Size (Rs) The unorganized segment dominates the Indian food service industry. It lacks technical and accounting standardization. It comprises Dhabas and roadside eateries that have been the most common forms of restaurants and have traditionally addressed eating out requirements of Indians. 1. Dhabas 2. Roadside Eateries (Street stalls, Hawkers, Trolleys, Standalone sweet shops) 10-100 Organized Formats Avg Ticket Size (Rs) Dining Fine Dining - A full service restaurant with a specific dedicated meal course. Décor features high quality materials with an eye towards the “atmosphere” desired by the restaurateur. The staff is usually highly trained. Fine dining restaurant usually targets rich and upper middle class consumer segments and offers unique ambience and upscale service. 750-3000 Casual Dining - A restaurant serving moderately priced food in a casual atmosphere oriented towards affordable family dining. Except for buffet style restaurants, these typically provide table service. This addresses the price point between fast food establishments and fine dining restaurants. 250-750 Bars and Lounges Mainly serve alcohol and related beverages. Includes night clubs, sports bars, etc. Example: F-Bar, Xtreme Sports Bar 500-3000 Quick Service Restaurant s They emphasize on speed of service, low cost and convenience. Also known as fast food outlets, for practical purposes, they are essentially characterized by minimal table service and can have a take away and/or home delivery format. McDonald’s, Nirula’s, Domino’s, Haldiram’s, Subway, Bikanerwalas are some of the leading names in this category. 100-350 Food Courts A relatively nascent phenomenon and being popularized by mall developers; also present at other shared spaces (for example airports, hospitals and office complexes). 100-300 Cafes Comprises coffee bars and parlours (for example Barista Lavazza, Café Coffee Day) and chai bars. These are casual restaurants that emphasize on serving beverages and food is incidental. 100-200 Kiosks A relatively new format which comprises Chinese food, corn, chat kiosks and those from established branded players like Café Coffee Day or Nirula’s. Also includes ice cream kiosks 100-200
  13. 13. MAJOR EXPANSION IN SECOND AND THIRD TIER CITIES  High rental costs and increasing operating costs are impacting the growth of consumer foodservice, and are set to do so in the future.  Many brands such as Domino’s KFC and Subway opened a high number of outlets in 2012-2013 and will continue to pursue expansion policies.  Companies are reaching out to second- and third-tier cities as the rents are low and sales are growing.  Off the 749 outlets operated by Domino’s in India, 376 ( roughly 50%) are located in tier – II and tier – II cities Rs 5,220 Rs 6,780 Rs 19,260 Rs 2,520 Rs 5,260 $ 18,300 Tier I Cities Tier II & III Cities Spending Pattern Per Household 2010 2013 2017 E 2010 2013 2018 E
  14. 14. DRIVERS OF FOOD SERVICE MARKET IN INDIA 1. Favourable Demographics: The majority of Indian consumption of fast food is driven by people between the ages of 18 and 40. 2. Increase in Income and Consumption Levels: . 3. Lifestyle Changes: The shift to nuclear families and with both parents working has increased demand for affordable “food on the go” and prepared ingredients to make cooking faster 4. Rising Number of Working Women: Increase in working women has increased the spending of their disposable incomes on eating out or serving ready-to-eat or to pick up prepared foods from QSRs 5. Foreign Direct Investment in India: 100% FDI (January 2012) in single brand retail under the government approval route, i.e., global single brands in F&B food service can now have full ownership of their Indian businesses Age Population <25 50 % <35 65% Indian GDP 6 % Disposable Income ↑ Indian Spend on Eating-Out ↑ 33,000 Crore Market size
  15. 15. CHALLENGES IN INDIA’S FOOD SERVICE MARKET 1. Food price inflation  A key factor affecting the consumer food services market, it is impacted by delayed monsoons, the economic slowdown, and unfavourable demand-supply conditions. It keeps fluctuating and reached a peak of 18% in 2010. 2. Fragmented Market  The QSR market has many small and mid-size unorganized players competing with large chain players. This fragmented market reflects a number of challenges, including unclear format segmentation, varied consumer options for eating out, and the lack of best practices for food services outlets. 3. Real Estate Cost  High real estate cost tend to impact store profitability. 4. Labour Acquisition and Cost  Manpower is a big challenge in the food services market, with an attrition rate of 25-30% and high cost of labour 5. Fragmented Supply Chain and Sourcing  The industry’s supply chain is fragmented in nature and marked by the presence of multiple intermediaries. The lack of appropriate infrastructure, inadequate technologies, and the non-integration of the food value chain are factors key to the wastage of nearly 30-40% of prepared food across the supply chain. 6. Red Tapism  In India, obtaining the requisite licenses, e.g. health license, food safety license, police license, No Objection Certificate (or NOC, from the fire department and the state pollution control board), etc. is a major obstacle hindering the smooth operation of a restaurant. The process is not centralized as yet and requires filing applications with individual stakeholders, which involves a lot of paperwork and is a time-consuming activity. 7. Multiple Level of Taxes  The Indian restaurant industry is burdened with multiple taxes like VAT, excise, and service tax, besides different state taxes
  16. 16. ACTIVE PRIVATE EQUITY INTEREST IN INDIAN FOOD SERVICE MARKET Company Industry Investor Type Deal Amount ( US$ mn ) Om Pizza - Papa John, Chili's QSR TVS Capital Private Placement 8.3 Adigas Fast Food QSR New Silk Route Private Placement Undisclosed Moshes Café New Silk Route Private Placement Undisclosed JSM Corp - HRC, California Pizza Kitchen QSR, Lounge Azim Premji Private Placement 25 Box8 (Ponchos) QSR Indian Angel Network Private Placement Undisclosed Devyani International Limited QSR India Advantage Fund Series III/ICICI Ventures Private Placement 36.04 Sagar Ratna Hotels Private Limited Hospitality India Equity Partners Fund I Private Placement 25.88 Nirulas Casual Dining/QSR Navis Asia Private Placement 22.5 Speciality Restaurants Fine Dining SAIF Partners Private Placement 22 Cuisine Asia Casual/Fine Dining Verlinvest Private Placement 20 Pind Balluchi Fine Dining Everstone Capital Private Placement 20 Amalgamated Coffee Bean and Trading Company - CCD QSR Sequoia Growth 20 Ammi's Biryani Casual Dining SAIF Partners Private Placement 7 Mast Kalendar Casual Dining Helion Venture Private Placement 6 Faasos QSR Sequoia Private Placement 5 Barbeque Nation Casual Dining CX Partners Private Placement 18.3 Beer Café Pub – QSR Mayfield Fund Private Placement Undisclosed Mani’s Dum Biryani Casual Dining Navlok Ventures Private Placement Undisclosed Fishtro QSR Correa Hospiyality Private Placement 5
  17. 17. WHAT IS A QSR (Quick Service Restaurant) 1. A quick service restaurant (QSR) is characterised by fast food cuisine, minimal table service and a fixed menu 2. The food (or ingredients) is prepared in bulk in advance and is packaged to order 3. QSRs are usually part of a restaurant chain or a franchise operation, which provisions standardised ingredients and/or partially prepared foods and supplies them to each restaurant through controlled channels. It is different from fine dining, as the latter usually targets rich and upper middle class consumers 4. Fine dining restaurants also offer a unique ambience and upscale service 5. Although fine dining restaurants do not compete directly with QSR, a moderate casual dining restaurant could be a competitor. It is pertinent to note that while QSRs typically target customers within the age group of 16-35 years, a casual dining restaurant would target people across age groups 6. QSRs are able to compete with casual dining restaurants on the basis of factors such as consistency in quality and speed of delivery.
  18. 18. KEY QSRs IN INDIA 44% 23% 15% 10% 6% 2% Cafes Pizzas International Fast Food (Non-Pizzas) Ice-Creams Indian Fast Food (Key players) Confectionaries 2,939 1515 1001 645 419 132 0 500 1,000 1,500 2,000 2,500 3,000 3,500 Cafes Pizza Chains International Fast Foods (Non-Pizzas) Ice-Creams Indian Fast Foods Confectionaries Outlets of Key Players (Nos. )
  19. 19. GROWTH TRENDS IN QSR INDUSTRY QSRs Approx. No. of Outlets Expansion Plan Café Coffee Day 1,534 10-15 outlets every month Domino’s Pizza 749 140-150 outlets every year Barista 180 Not Available McDonald’s 270 500 outlets in three years Pizza Hut 131 250 restaurants by 2015 US Pizza 81 Not Available Nirula’s 85 Not Available KFC 361 500 outlets by 2015 Costa Coffee 100 Not Available • High speed and consistent food service and efficiency • Convenient locations with easy accessibility from places of work, commuter routes and shopping areas • Limited menu choice of standardized items • Fast turnaround time through efficient model of drive-thru and quick order placement and delivery • Value proposition for customers due to low average checks
  20. 20. BREAK UP OF MARKET SHARE FOR QSR Foreign Brands Rs 23.4 bn Indian Brands Rs 13.8 bn Domino's Rs 4.8 bn KFC Rs 2.45 bn Pizza Hut Rs 1.8 bn McDonald's Rs 2.4 bn Subway Rs 3 bn Others Rs 9.6 bn Foreign Brands 63% Indian Brands 37% Domino's 20% KFC 9% Pizza Hut 8% McDonald' s 11% Subway 12% Others 40%
  21. 21. Opportunities in Food Service Back End Vending Ingredients Supply Merchandise Packaging Logistics Cutlery and Food Design Technology Outlet Design Front End Franchising Partnerships Starting your own restaurant
  22. 22. VENDING OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET Reseller Model Brand, Delivery Mechanisms • Public Places • Entertainment Malls • Transport • QSRs, Bakeries • Exhibitions • Educational institutes • Restaurants • Gyms • Canteens • Events • Road side resorts Food Services • 4 Star hotels • 3 Star hotels • Service apartments • Clubs • Caterers • FMC’s • Air lines • Railways • Guest houses • Resorts Employees / Visitors • SME’s • BPO/ IT / ITES / Software/ TEAS • Banking - BFSI • Corporate • Retail • Manufacturing • Services – Gyms, Salons, Spas, Car service centers, Car showrooms, Architects, Lawyers, Doctors, CA’s
  23. 23. USE OF TECHNOLOGY IN INDIAN FOOD SERVICE MARKET • Customer Feedback System – Dedicated CRM systems are now being favoured and accepted by most restaurants in the organized sector, thus creating a demand for such providers • Mobile Application Development – A fresh trend, largely observed in QSR segment, is the use of mobile apps for order-taking. – Since the input (address and order) is typed by the customer, chances of error are less. – As the demand for such apps are increasing, an opportunity with huge potential is observed. • GPS Enabled Delivery – GPS is being widely used by restaurants to aid delivery. • Digital Menu – Many restaurants now offer digital menu which is directly inked to the kitchen – This eliminates errors while order taking and also increases tables turnover rate • Mobile Point of Sale (MPOS) – These are mobile payment solution using debit/credit cards – Until recently, cash on delivery was the only mode of payment while delivering food. – However, plastic money being more prominent now, MPOS presents itself as a huge are for development. 23
  24. 24. MARKET RESEARCH OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET • Market research is a very important component of business strategy • It is a key factor to maintain competitiveness over competitors • Market research provides important information to identify and analyse the market need, market size and competition • With more and more players entering the food service space, the demand for market research service providers are on the rise 24 FOOD DESIGN OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET • Food Designing – Focuses on capitalizing upon the visual aspect of culinary art – Responsible for a lot of visual appetizing that one gets to see at local eateries – Demand is on the rise since many of the up-scale restaurants like Oh Calcutta, Masala Library, The Table etc and even some of the budget restaurants like Domino’s Venky’s Chicken require such services. • Localization – International restaurants and exotic cuisine makers rely heavily on localization – McAloo Tikki Burger, Peppy Paneer Pizza, Caviar Jalebi are some of the biggest examples – Presents a huge opportunity
  25. 25. PROCUREMENT OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET 25 Structure Description Direct Sourcing Most common among all channels. The restaurant sources products directly from the processors, vendor etc Commissaries Commissaries directly source food products from suppliers and deliver ready to eat food to the franchised outlet. Buying Agency A Buying Agency is an independent franchise-owned purchasing cooperative. It negotiates with suppliers on behalf of all its franchised outlets and aggregates demand Supply Chain Partners SCPs deals with suppliers for fresh products, such as chicken and vegetables, and delivers ready to eat food products to restaurants
  26. 26. STORE DESIGN, ARCHITECTURE AND CUTLERY SUPPLY OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET Store Décor and Architecture: • Store décor plays a major role on likability of a restaurant • Chained restaurants require uniform décor across outlets • Designing the décor and architecture of restaurants is on demand and supply is less • More restaurants = more opportunities • Very lucrative in monetary terms • Huge opportunity for Designers and Architects 26 Cutlery • With increasing number of restaurants, the demand for suppliers of cutlery is increasing • Competitive pricing and quality key to success • Not only restaurants, but vendors and caterers also require the services of such suppliers • Monogramed cutlery is also on demand Supplies • In addition to cutlery, supplies like tissue, soap, sanitizer, towels, napkins, coasters etc. are also required on a regular basis and are creating high demand
  27. 27. DISCOUNT AND COUPON AGGREGATOR WEBSITES • Indian customers actively seek out discount offers. Makes discount aggregator websites lucrative opportunities. • Currently, there are 150 websites which are actively involved in coupon business. On a conservative estimate, these sites generate a combined 6-7 million page views per month. • Around 4.6 million Internet users in India aged 15 and older accessed the coupons category which is 10.4 % of the entire online population. • Estimated to grow in the next 2-3 years because of the growth in e-commerce purchases.
  28. 28. SUPPLY SIDE INGREDIENTS OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET • There has been an increasing demand in the Food Service Industry for domestic, international and exotic ingredients • However, there are not many such partners, present on the supply side who can offer: 1. Competitive and Uniform Price 2. Uniform Quality 3. Uniform Quantity 4. Back-end Integration 5. Hygiene Standards • This has led to a gap in the supply side of ingredients for such restaurants which presents a huge opportunity with great potential 28
  29. 29. 29 CATEGORY INGREDIENT ITEMS CEREALS Wheat, Rice, Brown Rice, Barley, Oats, Pulses, Maize, Ragi, Semolina, Couscous, Millet, Gramflour, Riceflour, Wheatflour, Soyaflour, Cornstarch, Quinoa etc DAIRY Milk, UHT Processed Milk, Cheese, Mayonnaise, Cottage Cheese, Milk Powder, Yoghurt, Butter, Ghee (Clarified Butter) BEVERAGE-BASED COMPLEMENTARY TO DAIRY Coffee Beans, Tea, Green Tea, Fruit and Non-fruit syrups and Pulp, Nectars, Honey, Chocolate (Cocoa Beans), Vanilla, NUTS AND DRY FRUITS Walnuts, Figs, Dates, Cashew, Peanuts, Raisins, Chestnut, Pistachio, Hazelnut, Almond, Apricot, Coconut SPICES AND CONDIMENTS Nutmeg, Clove, Salt, Black Pepper, Dry Red Chillies, Rock Salt, Mustard, Turmeric, Cinnamon, Rye, Garlic, Cardamom, Parsley, Asafoetida, Fenugreek seeds, Cumin, Poppy, Kokam, Ginger, Green peppercorn, Fennel, Cassia, Pomegranate, Saffron, Star Anise, Aniseed, Marjoram, Tamarind, Dried mango FRESH HERBS Oregano, Basil, Bay Leaves, Coriander, Parsley, Mint leaves, Rosemary, Celery, Thyme, Lemongrass, Lemon leaves, Cilantro, Curry leaves, Sage, Chives, Marjoram, Wheat grass, Rhubarb, Leek leaves, Makroot VEGETABLES Potatoes, Tomatoes, Chillies, Onions, Sweet corn, Baby corn, Leeks, Jalapenos, Paprika, Olives, Mushroom (Oyster/Button), Lettuce, Capsicum, Bell Pepper, Spinach , Carrots, Beet, Radish, Artichokes, Beans, Cabbage, Brussels, Red Cabbage, Asparagus, Broccoli, Eggplant (Brinjal), Leeks, Zucchini, Peas, FRUITS Pineapple, Apple, Custard apple, Litchi, Melons, family of Berries, Peach, Lemon, Avocado, Dragon Fruit, Passion fruit, Mango, Banana, Citrus family, Guava, Papaya, Makroot, Rambutan, POULTRY AND MEAT AND SEA FOOD Chicken, Turkey, Duck, Goat meat (Mutton), Lamb, Pork, Prawns, Fresh water and Sea fishes, Crabs, Sharks, Squids, Clams, Oyster, Eggs OILS Mustard, Soya bean, Sunflower, Rice Bran, Vegetable, Olive, Coconut, Almond, Groundnut, Corn, Sesame, Chilli, Flaxseed, Wheat Germ, Meat Fat, Cod Liver (Fish)
  30. 30. SOME KEY SUPPLIERS 30 Cheese Dynamix Parag Amul Flanders Poultry Godrej Tyson Suguna Zorabian Vista Processed Foods Al-Kabeer Frozen Foods McCain Godrej Tyson Bakery Mrs Bector’s Cremica Exotic Vegetables Trikaya Jal Agro Pvt. Ltd. Ketchup Mrs Bector’s Cremica
  31. 31. MERCHANDISING OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET • Many restaurants, especially in the QSR space offer patrons (often kids) merchandising alongside certain purchases. Example include McDonalds’ happy meal offer and Domino’s Kids meal • Other restaurants like Hard Rock Café, Café Coffee Day, Starbucks and Gloria Jeans have dedicated merchandising within stores including • T-shirts • Mugs • Coffee hampers • Coasters • Posters • A lot of these merchandise, especially in the case of McDonald’s happy meal are also used as promotion material (Eg: Disney movies).
  32. 32. PACKAGING OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET • Indian Packaging Industry is valued at USD 19 Bn in 2014 and it is growing at 12% per annum • The food and beverage occupy the largest share of about 85% in packaging industry, a figure that is estimated to rise • Sustainability and bio degradable packaging missing • Light Weighing, easily transportable packaging missing • Only 600-700 packaging machine manufacturers of which 95% are in small and medium sectors and located all over the country , so there is huge gap in demand and supply of food packaging professionals
  33. 33. LOGISTICS SECTOR OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET • Warehousing : – Majority of operators are small to mid-sized entrepreneurs with limited capacity – Main players are government agencies like central and state warehousing corporations – The existing warehouses are of poor quality and are present in limited numbers without adequate capacity • Cold Chain Storage : – About 40% of fruits and vegetables grown in India gets wasted, so the sector needs to grow at much faster rate to meet the needs – With the poor electricity condition in the country the cost of operating such facilities is very high – So it provides an immense opportunity to organized players who can setup the infrastructure and are able to provide the service through out the nation
  34. 34. LOGISTICS SECTOR OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET Transportation • Important rail networks are oversaturated, rail fright tariffs are high, transit time are long and uncertain, terminal quality is poor, less flexibility in carrying different types of product • Road transport faces challenges like poor road quality with inadequate network coverage , high level of fragmentation along with majority of unorganized players in trucking industry, multiple check points • The current strength of frozen trucks inadequate to meet demand • Manufacturers are increasingly outsourcing their transportation needs
  35. 35. D’Essence Hospitality is a Management Consulting, Business Strategy and M&A Advisory firm based in Mumbai since 1998. We provide our services to QSRs, Casual Dining, Fine Dining , 4-5 Star Hotels, Clubs, Resorts, Service Apartments, Vending Solution Providers, Food Service Operators, Back end services providers in Tech etc Investment ServicesBusiness Consulting ServicesIndia Entry Strategy & Market Mapping • Partner Search • Master Franchising • M&AAdvisory • Target Search • Private Equity • Assistance in Due Diligence • Valuation • Creation of Investment Package • Post Merger Integration • Corporate Strategy • Business Plans • Growth Strategy • Turnaround Strategy • Start-ups • Business & Revenue Modeling • Marketing Strategy • Exit Strategy • Dashboards • Industry Reports • Benchmarking Studies • White Papers • Market Sizing • Domain Report • Feasibility Study • Entry Strategy • JV’s • Strategic Alliances • Partners • Market Mapping • Product Competitive Analysis
  36. 36. Chandni Sahgal Director D’Essence Hospitality Advisory Services Pvt Ltd 303, Aar Pee Center, 11th Road, Gufic Compound, MIDC, Andheri (E) Mumbai- 400093 +91 9820075332 022-28228142, 28347425 chandni@dessenceconsulting.com URL: www.dessenceconsulting.com, www.dessencehospitality.com

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