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Showing posts with label Indian bakery industry. Show all posts
Showing posts with label Indian bakery industry. Show all posts

Overview Of Indian Bakery Industry 2018

Indian Bakery Industry



Overview of Bakery Industry in India:
According to recent research, the bakery industry in India has an important place in the countries industrial map. Bakery products are an item of mass consumption in view of its economic price and high nutrient value. In the highly growing and changing eating habits of people, the increasing foreign influence and the rise of a female working population, bakery products have gained their popularity among people, contributing significantly to the growth trajectory of the bakery industry. After entry of Pizza and Burgers' MNCs in the country, people are changing their tastes also. Today, they are not restricted to bread, cake, and biscuits but to other bakery products also. The consumers are increasingly going for newer options with respect to bakery products.


Positive Aspects of Bakery Industry in India:
The growth rate of bakery products has been tremendous in both urban and rural areas at 14 percent per annum.
The global bakery ingredients market is growing rapidly and is anticipated to achieve significant growth over the next seven years.
Advancement in packaging and ongoing product diversification in baked food is expected to promote demand for bakery ingredient in upcoming years.
Challenges and Issues:
The volatility of raw materials and energy costs based on prices of wheat and vegetable oil that can vary as much as 40% in a single year.
Competition from customers within a consolidating supermarket industry.
In order to survive in an ever-changing marketplace, both bakery wholesalers and retailers must adapt to challenges faced by the industry.


Final Verdict:
Bakery industry in India is one of the largest sections in the processed food industry. It has undergone a major change on account of changing the perception of bakery products and evolving consumer tastes. By the perception of bakery products, consumption boost in the nation and changing consumer needs, we estimate the Indian bakery industry to reach levels of INR 483 billion in the next seven years. Rising urbanization and growth in the disposable incomes of the Indian population has proven to be a magnet for international bakery chains owing to which the sector has seen an entry of foreign bakery companies trading into India which has helped in enhancing the quality of Indian bakery products.

New Trends :

Any bakery enthusiasts   can   see   changes  in bakery products from whole grains to atta  biscuits /breads .  From desi to exotic   recipes of tart , ciabatta , muffins ,cinnabon,doughnuts   etc .

Following are  the new trends in baking industry
1) Premiumization
2) Gluten free
3) Bio degradable  packing
4) Organic ingredients
5) Gluten free
6) Sugar free
7) Fat free
8) Low salt 
9) Eggless
10)Multi grain
11) Hand Made
12) Ethnic -local 
13) Fortification 


Multinational  Players 

Many MNC  have now entered  Indian bakery  industry  to  get  some market share from entrenched Indian  brands  . Brands  like  Oreos from Kraft  ,  Mcvities  from  United Biscuits  and recently  we had  Bimbo  entering  Indian bakery market  with  acquisition  of   Harvest  Gold .



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What Make s Indian Bakery Market So Hot For Major International Companies

We have been witnessing  major international bakery companies  making beeline  to Indian bakery segment in recent times  with latest news of Kraft joining  the rank .

In  one of the my earlier  articles   I have mentioned about  failed attempts by mnc  to establish themselves  in bakery segment . But  that was in past   few factors  have  now  turned Indian bakery segment as  favorites for international biggies .

Here are few major reasons

Liberalised economy,  gone are they days for licence raj  .Present policies have  been opened for foreign participation in bakeries earlier restricted for  domestic players .

Economic slowdown across  the developed nations . With China and India having impressive growth rate for  decades  .These markets gives avenues  for growth to these companies. Bakery industry along with booming economy has been clocking  20% annual growth .


Disposable incomes  with  large middle class has  made consumers to try out  various bakery products which were out of the reach few years back.


Low competition   with  few  big local players on national scene  gives  big opportunities to these multinationals  to  enter  huge market  worth  Rs 12,000/ crore .


Availablity  of  Low cost technology and skilled manpower   makes manufacturing  attractive  for  these foreign companies


Availability of  raw material (  flour ,sugar ) except for  fat ( palm oil) which now being imported from   Asean countries  also  makes Indian market more lucrative .


Here are  major   multinationals   which have registered their presence in  Indian bakery  market in recent times

Kraft  Food Inc
United Biscuits 
Pepsico
GSKB ( Glaxo Smithkline )
Dunkin Donuts
Starbucks
Cinnabon
Unibic
Australian Foods ( Cookieman)
Lotte
Ceylon Biscuits Ltd














Movers And Shakers of Indian Bakery Industry

Following personalities in their own way have contributed  to   Indian Bakery  Industry ,which is  now transforming  into biggest  food processing  industry   estimated  to  be Rs 11000/- crore  and had now established its own  huge supply chain from  vendors , workers , consultants , equipment manufacturers , ingredient manufacturers , packaging design , packaging material , material handling , food safety ,pest control  bakery cafe s ,marketing and advertisement .



Nulsi Wadia  -  Took over Britannia from erstwhile  Biscuit King  Rajan Pillai . Had increased his stake in BIL  by  buying Danone ( french ) and Fontera ( New Zealand -dairy business ) shares  . Shrewd Business man  expanded Britannia s  foot print in Middle East through  buying out  Strategic Food Int llc -UAE  and Al Sallan foods -Oman .


Vinita Bali -  Guiding Britannia to robust growth  from  stagnation  . with experience in marketing through her stint  with Coca Cola and Cadburys  She  is now engaged into  diversifying this Biscuit giant into  dairy , Health and wellness beverages  market . I would like to mention  the predecessor to  Vinita Bali , Sunil Alagh was responsible for turnaround of  Britannia from  Rs 600.0 crore company to  Rs 2000 crore company


Sharad  and Vijay Chauhan  - Gained No-1  position for Parle as biscuit market leader in India . Aggressively driving  Parle distribution network and launching  new products .





Jayant Kapare  -  New entrant  to  Indian biscuit  market but with brand like  United Biscuits under his leadership is trying to establish itself  into major biscuit player .With launch of  products like cookies , cream , digestive  and Marie  in very short span  United Biscuits  is set  to give  good competition t



Nikhil  Sen - Took the challenge  to give Indian consumers something different from what has been offered till now through branding of cookies with leading   Australian firm Unibic . Mr Nikhil Sen has been an old hand  in biscuit industry as Ex -COO Britannia .




Chitrajan Dar  - Taking over from  prolific  leader in ITC food division    Ravi Navare . Marketing aggresively to get larger market share of biscuit market through launch of new products  




B.P  Agarwal - No one  ever thought that  a  small player like Priya gold would give a  tough competition to biggies of biscuit industry but through  clever marketing  and  pricing it made inroads to uncharted  rural market  thus making  Priya Gold  in Top 100 fmcg brand .



Sanjeev Kaushal - In less than a decade time Sanjeev Kaushal has made a mark in Indian bakery  equipment manufacturing   with  his company New Era Machines  and simultaneously building automation centre for these ventures through its arm New Era controls .

K.B .Kale  -  Pioneered  Biscuit Ovens in India  with his company Prima Engineering . Now manufacturing complete biscuit line  .Exporting biscuit lines to several  countries .
  

J.R  . Trivedi  - Doyen of Indian packaging machinery manufacturing . Mr JR Trivedi has developed low cost packaging machines  for Indian food processing  which can compete with imported machines on performance . Multipack  systems pvt ltd  is now exporting these  packing machines to several countries .



 Adil  Hassan and Taab Siddiqui-  Made  Harvest Gold Bread  a run way  success in  Delhi - NCR  region with in small period of time . Thus  becoming  consumers most preffered bread  in capital region dislodging Britannia and other  brands . Hence  they   proved that if  you make quality product  you can beat  the established players of the Industry .

H.T.Khorakhiwala - Established Monginis Foods and initiated indian  bakery  cafe s  in different cities . Monginis cakes/muffins cup cakes  are now availbale in  major cities  and have 250 retail shop  across India .




M. Mahadevan  -  Responsible for  setting up  bakery  retail   shop  by the name " Hot Bread " . Now expanding in different parts of world .


Anand Kripalu  -  MD Cadburys India  Now under Kraft Food Inc  would be responsible  for launching brands like Oreo biscuit  in India


Many more on regional levels 


Add your own favorites you think  have contributed to Indian bakery industry .






















Britannia controls 100% of Daily bread

Bakery major Britannia has increased its stake from 50% to 100% in its jv with Daily bread which it acquired in 2006 . This would help Britannia to consolidates its presence in bread markets . It has not rolled out this brand nationaly as they are testing local markets with concepts like retail bakery chains with cafe like ambience .

Read article on ET

Biscuit manufacturers are moving out of NOIDA

Noida was once described as most industrialised zone near capital Delhi , but recent incidents and the taxation in that area has made business men to shift their operations . Companies like Surya foods and lancer biscuits have shifted their base to near by state uttarakhand .



Read article on exit of bakery units from Noida

Bulk handling in Bakery Industry



Bakery manufacturers are now installing bulk handling systems for their major ingredients like flour , sugar , fat ,butter and other ingredients .
Few of bakery product manufacturers are still operating on a daily receipt of raw material which may some times result in stock out or production re-sheduling which may result in sale loss .
Many equipment manufacturers are providing complete plant from silos , conveyors to automation . Few of them are

INDCON PROJECTS
REICO INDUSTRIES
MIRANDA AUTOMATION
NEW ERA INDUSTRIES

Most of these bulk handling uses pneumatics for their application or there can be conveyors for transporting material from one place to another .
Bulk handling for raw material has major advantages are


  • Major savings on raw material cost when procured in bulk.
  • Savings on loading and unloading cost and labour .
  • Stock outs are eliminated.
  • Automation can increase the productivity.
Bulk tankers can be arranged by flour , fat and sugar processing companies or manufacturers
  • Reduces procurement deptt follow up job s.
  • Increase vendor loyalty as you procure bulk quantities .
  • Hygienic as raw material is stored in Silos .
  • Inspection and stores procedures are reduced .
Bulk handling should be implemented if space in not a problem .Bulk handling has been implemented by most of the major bakery product manufacturer

Frontier biscuits - popular home made biscuits


Frontier biscuits factory pvt Ltd have adopted a unique selling preposition for itself .It has established itself as eggless home made biscuits and cookies .you can find its showroom in all major areas of capital,Delhi and Haryana . I have visited one of these exclusive show room it displays various cookies either in Jars or gift packs you can buy in both the options . Wide variety of products are available and it caters for indian palate . you can find kaju , ajwain , mango , coconut ,butter ,soya , besan ,milk , chocolate and other varieties .It has tried to brand the home made cookies market which is still popular in many part of our country


Established in 1921 it has grown in size and have created a niche for itself ,even today you can find people enjoying home made cookies .Showroom called as Frontier shopping zone is similar to Bikaneriwala or Haldiram showrooms except for the owner ship .Frontier shopping zone owners are like authorised dealers who have exclusive rights to sell frontier products in that area .They also produce eggless cakes , nan khatai , bhujia , rusk

Priya gold emerging as a national brand


I was just flipping some business magazine for Indian top 10 food brands. What stuck me was Priya gold s entry into the top 10 . In span of 10-15 years Priya golds growth has been spectacular .Its brand recall has amazed many trade pundits .

Priya gold now has market share of 12% for bakery market with britannia(38%) and parle(42%) as the leader of the pack .

It all started in year 1993 .Shri B. P Agarawal established a biscuit plant in noida and started manufacturing biscuits . With products like classic , butter bite becoming popular in short period .Below are the reasons for its popularity

ADS AND PROMOTION

It has establsihed it self as low cost premium product plank and with a popular ad campaign which ran for years was "" HAQ SE MANGO "' with Priya tendulkar as their lead personality for ads .She was popular with middle class for her role as rajni in tv serial rajni who stood for middle class rights.Now of course they have enrolled Karisma kapoor for makeover of image on upmarket image . Priya gold ran promos for it products.declaring prizes on it products.Priya gold focused on rural and tier 2 and tier -3 towns markets with great success .

PACKAGING

One of the most innovative thing surya foods did was introducing ""family pack ""where you have pack of 400-300gms .Normal packs are of 100g , 150g , 75g packs .
When every one was launching sachet or ""tikipacks"" ie small packs of 3-4 biscuit a pack. Surya food went ahead with family packs and it was instant hit . Indian middle class lapped it up . Others had to follow but by the time Priya gold had its customer base .

PRICE AND DISTRIBUTION

Pricing was done keeping with competition it placed it self on low price premium product plank.They delivered directly to dealers from there godowns with better margins to retailers who pushed their products for better sale.

Surya food now produces 23 varieties of biscuits with tonnage up to 150000 p.a. Popular products are Butter bite ,Marie lite ,Classic cream,Boss,CNC ,CheezeBit

Britannias marketing strategies




Britannia being the largest manufacturer in bakery segment has developed a very aggressive marketing strategies for its product in view of tough competition from reputed brands and local products .Britannia in recent years has seen low growth in its market share .

Its has first of all categorised its product into 5-6 Power brands ( GOOD DAY , TIGER , FIFTY-FIFTY , CREAM TREATS , MARIE , MILKBIKIS ) and reduced the numerous sku''s it had in its inventory .Each brand has brand manager responsible for the business.

Diversified into dairy , wafers and snacking products through merger and acquisitions . these has given it some breakthrough from its stagnating market share of bakery products.

Now new focus has been for its categories of wellness and indulgence .Wellness concepts has been introduced for health conscious masses as this lobby becomes more vocal and with fear that the bakery products are not considered as nutritious products hence there are several launches as iron/vitamins/calcium fortified and low or zero fat biscuits .Few Brands would come with some form of fortification such as Nutrichoice , Marie , Tiger with few changes in pack sizes and prices .

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