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EQUIPMENT

Food preparation equipment supplies industry - Favourable policies
Tuesday, 05 March, 2019, 08 : 00 AM [IST]
Florence Tardy
Preparing tasty food is an art and only he masters the art who knows the right ingredients and has access to the best food preparation equipment. Looks should go sacrosanct with the taste when it comes to cooking delicious food. When a chef prepares a dish, he celebrates his love for food and the compliments from the guests not only satisfy his starving soul but also boosts his passion to perform better each and every day. Apart from the cooking skills, the choice of the correct kitchen appliances is equally significant to enhance the flavour and get a perfect recipe cooked.    

As per GFK’17 (Gesellschaft für Konsumforschung, "Society for Consumer Research”) report, Indian food preparation equipment and supplies industry accounts for almost Rs 4,000 crore and the sector has grown by more than 10% in last few years.

India is a country of festivals and the whopping population of over 1.3 billion gives enormous opportunities to the kitchen appliances industry that inspires companies to innovate new products to make cooking an enjoyable experience. With a young population of over 55%, kitchen appliances market in India is projected to grow at a fast pace.

The food and beverage industry alone contributes 2% to India’s GDP (Gross Domestic Product). With the advent of change in FDI (Foreign Direct Investment) policy, several international brands entered the domestic market giving a boost to the kitchen appliances segment. And, the industry saw a lot of changes in terms of innovative products, competitive pricing which eventually benefitted the end-consumers. As a result, the domestic market became a buyer-centric market where on one side there are a few consumers who are price-sensitive but then there are others who are ready to shell out extra money to get better products.

Today, India is one of the largest economies with GDP of US$2.6 lakh crore (2017) adding to the purchasing power of the consumer. The steady economic growth rate is likely to attract more companies to invest in India. Especially, after the World Bank’s latest Doing Business Report release in January 2019 which, showcased that India has recorded a jump of 23 positions against its rank of 100 in 2017. The country is now placed at 77th rank among 190 countries.

Relaxing FDI policies by making 100% FDI possible via the automatic route in the electronics market and building Special Economic Zones have further played a vital role in attracting the attention of foreign companies which are now more willing to invest in India.

Recently the government has announced changes in the GST (Goods and Services Tax) rate for food preparation equipment from 28% to 18% which has positively impacted the industry by increased consumer demand. Additionally, the OEM (Original Equipment Manufacturers) will get away with the hassle of paying the tax at multiple places starting from procuring the raw material to getting the finalised goods being sold to the retailers.  Small equipment industry has a lot of scope for innovations to save time and energy, increase comfort of use and come out with solutions to retain nutrients and manufacture higher durability products.

The food preparation equipment and supplies industry has a huge potential because of its penetration rate of almost 40~45%. However, it is important for the industry and government to put a close vigil on the quality of products to keep customers’ trust intact. Uniform standard norms such as BIS (Bureau of Indian Standards) are necessary to ensure quality of the goods.

Additionally, after sales service also plays a pivotal role in customer satisfaction and customer retention. A part of ‘after sales service’ is conducting surveys to find out the real problems of the consumers while using a particular product. This activity helps to know the happiness quotient and consumer satisfaction ratings from the horse’s mouth. The data collected can prove to be valuable for the company’s R&D and sales department.

These surveys can be outsourced to call centres where the representatives can not only address customer’s problems over the call but can also try to rectify it. This will help in positioning the brand in the minds of the consumers and maintaining the goodwill of the company by increasing the longevity of the products especially at a time when brand polarisation plays a vital role, as consumers are more anxious and demanding. Social networking platforms allow people to share their opinions with their friends and peers, enabling the ability to influence others’ buying decisions.

(The author is VP, marketing, Groupe SEB India. The French company introduced Tefal in the Indian market in March 2017)
 
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