Snapshot of food industry news this week
Global Dairy Ingredients Market to Reach USD 59.8 Billion by 2020
The Dairy Ingredients Market has been segmented into milk powder, whey ingredients, MPC and MPI, lactose and its derivatives, casein and caseinates, and others which include milk protein hydrolysed, whey protein hydrolysed, milk and whey peptides, dairy protein fractions, colostrums, and a-lac. According to application of these products they are segmented into bakery & confectionery, dairy products, convenience foods, infant milk formula, sports & clinical nutrition, beverages, and non-dairy creamers, of which dairy powder accounts for the largest share.
According to projected reports the global Dairy Ingredients Market is all set for growth which is largely due to the demand for nutritional food products with health benefits. USA, China and India increased production in this segment because there is a growing demand for healthy, diversified food. Besides this the growing convenience food & beverage industry also supports the growth of the Dairy Ingredients Market. Growth of income levels and more disposable incomes with the middle class in the Asia-Pacific region is also fuelling trends. Therefore the global Dairy Ingredients Market is slated to grow at CAGR of 5.6 per cent between 2015 and 2020 with estimates of reaching USD 59.8 Billion. However, factors like alternative plant protein availability and low cost of soy protein and rising incidences of lactose intolerance and milk allergies could pose a challenge to the growth of the Dairy Ingredients Market.
Big Bazaar, Easy Day outlets to sell Patanjali products
Businessman Kishore Biyani’s Future Group has partnered with Patanjali Ayurveda to sell their products in 240 cities at all Future Group retail outlets including Big Bazaar and Easy Day chains. Both Future Group and Patanjali Ayurveda have food parks in Bangalore and Haridwar and that is where Future group saw Ramdev’s revolutionary products. The Haridwar-based yoga guru and entrepreneur emphasised that he just wants to make swadeshi products popular but does not advocate banning foreign products. Future Group and Patanjali will be setting up an office for collaboration in Rishikesh in the next 20 months and will jointly do a business of Rs.1,000 crore. Ramdev selected the Future Group as he considers Biyani the king of retail in India. They will also tie up for manufacturing where possible. The Patanjali Group also produces and markets various ayurvedic products besides consumer products.
Chef Sanjeev Kapoor to Invest in start-up ZuperMeal
Sanjeev Kapoor along with Wonderchef partner, Ravi Saxena and two foreign partners are to invest about Rs.13 crore in Mumbai based ZuperMeal. The mobile based delivery and marketplace service for home cooked meals is a start-up that is founded by Pallavi, Ravi Saxena’s wife, along with Balasubramanian A and Prabhakar Banerjee who are IIM graduates. The company launched operations two months back in Powai, Mumbai. ZuperMeal supports the concept of ‘eating out at home’ which means you get fresh home cooked meals delivered at home which have no additives or preservatives.
ZuperMeal is being seen as a start-up that is going to empower Indian women and will use the funds to scale up operations. The aim is to use the best dishes, curated by 60,000 housewives whereas presently only 150 homemakers are registered on the platform and 20 of them active. They also plan to take their food services to 500 small and big towns across the country to give the company volumes of Rs.4, 500 crore by 2020. By leveraging the strong network of 35,000 women entrepreneurs of Wonderchef, ZuperMeal intends to scale-up quickly across the country.
The F&B Market to be driven by households in the Rs.3-6 lakh income bracket
Over 72 million households will be entering the income bracket of Rs.3-6 lakh in the coming five years. It is these households that will be the drives in the food and beverage industry. The BMI research group says that consumer dynamics are quite favourable with the increase in urbanisation and middle class household incomes. The report suggested that it is the Rs.3 lakh threshold which sees households change their consumption patterns and adopt more modern habits. Though the industry has the drivers MNCs are still hesitant to invest as they are worried about regulatory hurdles. What is posing as hurdles for investors is the weak Infrastructure and complicated administrative and taxation procedures. Along with this that fact that Goods and Services Tax (GST) does not seem likely to be implemented by April 2016 is also an issue with most investors.
The Southern Region will see and Expansion of Goli Vada Pav Outlets
Goli Vada Pav, a domestic quick service restaurant chain, recently opened a new outlet at Kochi in Palarivattom area. This takes the total number of their stores in the city to seven. The new store is just one of the 50 new stores that the company is planning to open in south India in the coming year. Goli Vada Pav has more than 350 stores in 88 cities and 19 states in India. However, it is the southern market that generates the most revenue for the QSR. Therefore more stores are planned to come up in cities like Kottayam, Kannur, Calicut and Thiruvananthapuram. Goli Vada Pav has a target to open more than 200 stores in Kerala and Tamil Nadu in the coming five years and 1000 stores across the country by 2020.
Coffee Day Enterprises: India is likely to have 5,000 cafés in 5 years
According to Coffee Day Enterprises the number of coffee shops in India is likely to rise to 5,000 across all brands. Rising income levels and enthusiasm of the youth for coffee is stated to be the reason for rising coffee shops in India. Almost 1000 of these coffee shops will come on highways as people look for a decent place to take a break from driving. Seeing that coffee drinking is going to be quite popular in the coming years Coffee Day Enterprises, the parent company of the Coffee Day Group, which runs Cafe Coffee Day outlets is planning to open 135 stores and add 5,000 vending machines in India every year. The company is raising funds through sale of shares to open on 14 October. Out of the Rs.1, 150 crores they hope to raise, an amount of Rs.632 crores will be used to pay off debts and the rest will be spent on expanding the coffee business. Cafe Coffee Day has the largest number of outlets in the country. Their 1500 outlets are four times more than the combined outlets of competitors like Barista, Costa Coffee and Starbucks.
Burger King and Scootsy Partner for Home Delivery Services
Home delivery services are getting popular and partnerships are mushrooming all the time. The latest venture is the partnership of fast food chain Burger King with hyper-local company Scootsy for its home delivery service in Mumbai. Founded only in 2015, Scootsy is headquartered in Mumbai but plans to expand operations across India. Burger King operates 30 stores across Mumbai, Delhi, National Capital Region, Bengaluru, Pune, Chandigarh, Ludhiana and Jalandhar and has already created a name in the world of fast foods.
Since the use of mobiles has increased businesses are also using mobile Apps to do business. Customers will be able to place their orders through Scootsy’s ordering app which includes some of Burger King’s signature dishes such as Whopper, Paneer King Melt, Xtra Long Mexican Veg and Chicken Chilli Cheezos. Delivery will be made within 30 minutes of ordering from Burger King outlets in Lower Parel and Churchgate in Mumbai. The strategic partnership is being viewed by both partners as an avenue for growth. Customers will also be able to enjoy Burger King foods at home.
Varun Beverages to get Rs 600 Crore as Investment
Ravi Jaipuria (RJ)-led Varun Beverages Ltd (VBL) is to receive an investment of Rs.600 crore from Singapore-based Aion Investments. In return Aion will be issued non-convertible debentures worth Rs.300 crore. VBL is the largest bottler for PepsiCo in India and the Rs.300 crore they receive will be used in refinancing its existing debt and expansion of its operations. Aion will use the rest of the money for acquiring compulsorily convertible debentures from the existing investors of VBL. Aion is extremely pleased to partner the RJ Corp Group as they have vast experience in the Indian consumer market. For their part Aion has become the largest external investor in Varun Beverages Limited. As one of the largest bottlers VBL bottles, distributes and sells soft drink beverages such as Pepsi, 7UP, Mirinda and Mountain Dew in 13 states in the country, apart from Sri Lanka, Nepal and Morocco.
Will McDonald’s new breakfast campaign help generate sales in India?
McDonald’s is keen to build out-of-home breakfast as a category in India. They are seriously thinking of extending their All-Day Breakfast campaign to India which will mainly target corporate clients. Almost 18% of the breakfast-consuming office goers in India eat breakfast outside home. Besides the breakfast scheme, another scheme that they hope to build on is the McDelivery Service.
Breakfast has become one of the fastest growing business platforms for quick service restaurants. McDonald’s breakfast menu of wholesome, grilled platter with veg/egg and sausage muffin, hash brown, hot cakes with maple syrup along with McCafe offerings, is already available between 7a.m and 11a.m in India but not beyond 11a.m. In smaller cities, the restaurants open at 9a.m. The All-Day-Breakfast campaign, launched in the US in October is being seen as one of the biggest strategic decisions and has been made with the view of reducing the slump in sales.
Yoga Guru Ramdev’s Patanjali Noodles all set for Launch
Yoga Guru, Baba Ramdev’s Patanjali Ayurveda will soon launch a new range of ‘instant noodles.’ The packet is priced at Rs.15 which is lower than other brands being presently sold in the country. Patanjali noodles are to hit markets on October 15 and are likely to create quite a stir in the noodle consumer market. The noodles will be made from whole wheat flour (atta) and not maida. Patanjali noodles will use rice-bran oil and not cheap and inferior palm oil as used by others said the Yoga Guru. He added that they are working on the principles of Swadeshi and mean to improve the health of the country. The company claims their instant noodles have no lead or taste enhancer MSG. This is being seen as a move to capture the market that has not yet been filled after the Maggi fiasco. Patanjali’s catch line for the instant noodles is “Jhat pat pakao, aur befikr khao,” also resembles the Maggi ‘two-minute noodles.’ The taste maker is being touted as ‘heath maker.’