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Godrej Agrovet building cold chains to promote Yummiez
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Saturday, 23 December, 2006, 08 : 00 AM [IST]
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onglomerate, is one of the pioneers to give the poultry industry in India a professional and modern approach. After setting up an Integrated Poultry Business (IBP) in 1999, today the company covers the whole spectrum of the poultry business, right from breeding, hatching, rearing of broilers to processing and marketing of its branded chicken 'Godrej Real Good Chicken'.The company entered the value added chicken snacks segment in June by launching Godrej Yummiez, a new range of ready-to-cook snacks. Following its success, the company also launched the vegetarian snacks in the ready-to-cook range of Godrej Yummiez just a month ago. Balram Singh Yadav, vice-president, Godrej Agrovet, spoke to Dhwani Pandya of Food & Beverage News on the initial response to Yummiez in the market and its future plans. Excerpts:
What is your take on the current scenario of ready-to-eat/ready-to-cook food sector in the country?
Among the different segments of the ready-to-eat (RTE) industry, the frozen ready-to-cook/ eat segment is of Rs 120-130 crore in the non-vegetarian category and Rs 200 crore in vegetarian category. The good news is that the sector is growing at the rate of 20-25% and is expected to witness a higher growth with the advent of modern trade.
What are the key issues affecting the sector?
Earlier very heavy taxes were imposed on this sector, however now it has come down considerably. Currently the biggest issue for the frozen ready-to-cook and eat industry is the total absence of cold chain and a cold chain discipline. By cold chain discipline, I mean the attitude towards the cold chain. Retailers' tendency to switch off the freezers during the night is one such example. They have to understand that the slight abuse in the temperature can affect the quality of products.
Do you think that price is still an issue/concern constraining the acceptance of ready-to-eat/cook food items?
Price is not an issue considering that most of the veg products are priced between Rs 100-150 a kg and non-veg between Rs 200-250 a kg. Generally a helping for one person is anywhere between 150-200 gm, so the cost of product per person in a veg product can be anywhere between Rs 30-35 and Rs 40-45 in non-veg category which I believe is affordable enough.
Currently which are the places where Godrej Yummiez products are available?
We launched our products in June initially in Mumbai and Pune and subsequently in Goa. Now we are rolling out in cities like Banglore, Hyderabad and Delhi. We want to be present in 10 to 12 major Indian cities by March.
What about the expansion in tier II and III cities?
As I told you the only issue is cold chain. Unlike Mumbai the electricity supply in other cities is terrible. As cold chains are dependent on electricity, we have to be very selective while giving our products to retailers. We can give our products to only those outlets, which have energy backup. Poor distribution channel is one more reason for the slow spread of such frozen products. With the advent of modern trade I think this problem will be solved, as modern trade will definitely have some energy backups.
What has been the initial response of the recent launch of vegetarian snacks in the ready-to-cook category?
Vegetarian snacks have been launched only a month ago in four different variants. The retail universe of veg products is much bigger than non-veg. We have a bigger challenge in terms of distribution and cold chain as these products have to be stored at -20 degree celsius. The initial response of veg snacks has been extremely encouraging, now it will be rolled out in cities like Pune, Goa and Bangalore.
Under the ready-to-eat/cook category how many more products you propose to launch?
Lots of products are under development. Today we have around 10 products in the Non-veg category and four in the veg category. It is not the number of products, which are important in this category, what is important is how we build the excitement. The total number of products might remain the same15 even after four or five years. These products are about the leisure, excitement and value addition. We have to create excitement in this category by bringing new products with time.
Packaging and preservation are the two most important aspects affecting the quality of ready-to-eat food items. How far Godrej Yummiez satisfy the same?
Packaging of Yummiez products is of an international class; the material used for packaging is of highest quality. We are sure that in packaging we are at par with the best in the world. Yummiez snacks are prepared without using any artificial flavours and preservatives. With temperature being the only preservative for the product, we are concentrating on developing cold chains. It is the only way to maintain the taste and quality of our product till it reaches the consumer for which we are making huge investment in establishing a cold chain. We have already distributed more than 500 freezers to our retailers, where each freezer costs Rs 15,000 to 20,000. Around Rs one crore has been invested in developing cold chains and the amount will be double in the coming years.
How do you ensure the quality of Godrej Yummiez products?
All the Yummiez products are HACCP & MFPO certified. The products are made by vista foods, which is a subsidiary of OSI International. OSI International is a supplier to international giants like McDonald's, Wal-Mart, Tesco etc for food products having a turnover of $7 billion. They have international class of experience and standards in food products.We also have a state-of-the-art testing and products development laboratory at Taloja where most of the products undergo various kind of chemical, microbiological test for aspects like taste and shelf life.
In the next one year we will concentrate on extending our distribution channel. Once we are present in the top 25 Indian cities, we would put real thrust on using all sorts of media for the much needed concept styling, brand awareness and brand building of Yummiez products.
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