Growing opportunity in the frozen foods sector has led Shri Bajrang Alliance Limited to venture into the food and beverage industry. Based out of Raipur, Chhattisgarh, the company recently announced that it would soon be launching its new series of frozen foods with a spectrum of interesting options to cater to the pure vegetarian consumers. Archit Goel, director and chief financial officer, Shri Bajrang Alliance Limited, shares his views on the frozen foods industry and the impact of Covid-19 on food and allied businesses in an email interview with Kimberley Fernandes. Excerpts:
What is the idea or inspiration behind the move to the frozen foods industry?
The Indian frozen food industry first started off by offering frozen vegetables and fries. Today, it delivers a wide variety of products, ranging from fruits and vegetables to frozen meat and ready -to-cook, snacking and full meal options. Among these, frozen snacks and vegetables are the largest categories in terms of sales volume (65 per cent) among the Indian customers.
Quick Service Restaurants (QSR), fast food chains, hotels, and cafes from not only metros, but even from tier - II and tier - III cities are gearing up to offer their customers the finest of food along with the ambience. Hence, they have started using frozen food to serve their orders quickly and efficiently without any hassles.
Frozen food has also witnessed rapid growth thanks to the evolution and growth in modern retail.
India’s frozen food market stood at $310 million in 2017 and is projected to grow at a CAGR of over 16 per cent to reach $754 million by 2023, backed by rapidly growing demand from middle class consumers with increasing disposable income. Rising urbanisation, increasing number of refrigeration facilities in small retail shops and rural households, and growing cold chain industry are expected to significantly contribute towards the growth of frozen food market in the country over the coming years. Moreover, growing organised retail and e-commerce industry are among few other factors anticipated to propel demand for frozen food in India during forecast period.
Having said all these facts and figures, the truth is the frozen food category is still in its nascent stage in India. As per the studies, the consumer penetration towards this category is approximately 1 per cent and that makes more interesting as a great opportunity we have in Indian market.
Tell us about your company's product portfolio.
Our frozen food range is going to be available in the retail space soon. In the launch phase we have selected 15 products for launch in the domestic market, while for the export market there are 57 products ready with us. This range of products includes variety of Indian snacks, Indian breads, curries, thalis, premium vegetables and desserts. All our products are completely 100 per cent vegetarian frozen food range and are made at a 100 per cent vegetarian kitchen. None of our products have any kind of added preservatives, colours or flavours.
What type of research goes into the development of these products?
We have done an extensive consumer research to understand the consumers’ taste profile and their pain areas when it comes to food, food preparation, taste and packaged food preferences. The research also covered the category attitudes and perceptions of the Indian consumers. Based on all these inputs our R&D team developed a series of products which again went for consumer testing. Based on the given feedback by the consumers from various cities and from various TG groups we developed the final product range.
What are the key factors that would differentiate your brand from the existing brands in the frozen foods market?
Goeld is completely 100 per cent vegetarian frozen food range made at 100 per cent vegetarian kitchen. As a group we believe in ‘vegetarianism’ and thus we follow this route to develop the products too.
All our products are free from any kind of harm. None of our products have any kind of added preservatives, colours or flavours. It’s free from all chemicals which are normally added to the products to get a longer shelf life. We instead use the latest freezing technology to preserve all nutrients in the food and also get a 12 months shelf life. Apart from this, Goeld products are absolutely free from trans fats. When we say zero trans fats on our pack and label we actually mean it and the products are with 0.00 per cent trans fats.
We also have few 100 per cent vegan products in our Indian breads and snacks range.
What do you hope to achieve for your brand in the?frozen food industry post-Covid-19, in the next few years to come?
The post-Covid scenario is very positive for the frozen food industry. Consumers are now more looking for the better packaged food options because of the hygiene and safety concerns. At the same time, the whole world is moving toward vegetarianism. As our whole range is in this route and also select products from the range are completely vegan which is the next trend going to emerge. This is a great opportunity for us.
We think that consumers are going to be choosy and will now look for healthier, high quality products. Many of the consumers are going to change their brand preference and will move towards those brands who guarantee them where products have made, what goes inside the pack as ingredients and how good is the food product in terms of the health perspective.
What are the challenges you see your brand facing in the frozen foods industry in the country, post-Covid-19?
Post-Covid-19, the frozen food brands will get more acceptance from the consumers and the consumer penetration to the category is going to rapidly increase in India. The same trend is now visible in the Indian market and especially across all Asian markets. Earlier, the high cost of processed food items posed a major challenge for the category to grow. However people in society are becoming self-aware and health-conscious and have entirely transformed the face of the frozen food category.
The only challenge any brand in this category facing is the willingness of the retailer – be it a kirana store or a stand-alone super market or a hypermarket – to set up required amount of infrastructure. Due to Covid-19, this challenge will further boil down because of shortage of liquidity funds at the retailers’ front.
Do you foresee new policy interventions from the government for the frozen foods industry in India?
Not really at this point of time as the FSSAI has already covered all safety and hygiene norms in their guidelines which all food processing companies have to adhere.
What kind of action plan do you have in place for sourcing raw materials, in light of Covid-19?
Our sourcing team has well planned SOPs for sourcing of any raw materials required for the production. All the vegetables we use are of premium quality and are handpicked by our veg sourcing team on a daily basis. Once the RM reaches at our plant it goes through stringent quality checking in various stages before it goes for processing and production. It has already been communicated to all our approved vendors that the vehicle should be sanitised, cleaned and properly covered at the time of delivery of RM.
The food and beverage industry has suffered huge losses due to the global pandemic. What are your observations?
Covid-19 has impacted most of the industries across the world and has had a growing impact on the global economy. One of the recent studies reveal that the retail trade lost business worth of Rs 9 lakh crore in 60 days (that is Rs 15,000 crore per day). This also impacted the job security of 40 per cent of the 6 million employees working in the Indian retail sector. Companies in India expect a negative impact on their business in next 12 months.
Not only the F&B industry, every industry, function and geography is affected and the amount of potential change to think through is daunting. Government is making significant interventions in response to the Covid-19, all businesses are quickly adjusting themselves to the changing needs of their people, their customers / consumers, suppliers, while navigating the financial and operational challenges.
What kind of technological interventions does the company apply for ensuring and adhering to the food safety norms?
The best practices of safety and hygiene standards are implemented at our factory and food processing as per the Food Hygiene and Safety Guidelines issued by FSSAI. Our plant has implemented Good Hygiene Practises (GHP) and Good Manufacturing Practises (GMP) from day one to strengthen the food hygiene and sanitation practises. We also practise thermal screening and monitoring of all employees and food handlers including vehicles. We also ensure social distancing within the premises to avoid any infection.
Any plans on collaboration with leading food services in India?
We are already in discussion with few leading food service companies in India and abroad. The Covid-19 and lockdown period delayed the finalisation of the deal. We are very positive that the discussions will be closed within the next month as most of QSRs are also not fully functional at this moment. Once the situation improves, we are sure that the demands from their customers will also increase. It is also evident that Indian consumers now want quality food made at hygienic places and this will enable us to approach more food service customers as we have 100 per cent vegetarian products made at 100 per cent vegetarian kitchens.