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INTERVIEW

“We are setting a target of Rs 10 cr for FY24”
Monday, 26 February, 2024, 08 : 00 AM [IST]
Scuzo is India’s first live Popsicle Concept Dessert Cafe with a large variety to choose from including Popsicles, Gelatos, Sorbets, Waffles, Brownie Sizzler, Milkshakes, Hot and Cold Beverages and Savouries. It has quickly become a beloved name in the dessert space, using high quality natural ingredients without using any additives that sets it a class apart from the rest.

Gagan Anand, founder and director at Scuzo Ice ‘O’ Magic, shares his views on the ice cream sector, demand and supply, dairy-free and vegan options, sustainability, growth plans and more, in an email interview with Kimberley Almeida. Excerpts:

Give us details about the idea behind Scuzo Ice-O-Magic. How has the company faired since its inception in 2020?
The name 'Scuzo' has its origins in my personal experiences and my deep love for sweets. During my childhood, I delighted in creating my own unique treats using roti and jaggery. I often playfully remarked that if anyone were to search for me, they would discover me hidden amidst a pile of jaggery. It is the fond memories of my childhood and my enduring passion for sweets that inspired me to establish 'Scuzo Ice 'O' Magic.'

The idea for 'Scuzo Ice-O-Magic' became clear to me while I was working on 'Rasna Buzz,' evoking nostalgic recollections of my childhood delight with ice cream vendors. The central concept behind 'Scuzo Ice-O-Magic' is to empower customers to select their favourite fruits and witness the creation of fresh fruit popsicles right before their eyes. This concept filled me with excitement and served as the driving force behind the inception of the business.

We officially launched 'Scuzo Ice-O-Magic' during the pandemic, inaugurating our very first store in November 2020. To bring this vision to life, I took a significant step by investing Rs 70 lakh, a substantial amount for me. This capital enabled us to construct our store, assemble a skilled team, and devise creative strategies to introduce people to 'Scuzo Ice 'O' Magic.'

During the initial months, spanning from November 2020 to February 2021, our sales showed promise, generating a revenue of Rs 76 lakh. However, in the subsequent fiscal year, 2021-2022, due to the ongoing pandemic, our sales decreased to Rs 67 lakh.

Fortunately, in the following year, 2022-2023, our business witnessed substantial growth. Our sales increased by approximately 40%, signaling a positive trend, with more people embracing our brand.

'Scuzo' represents expertise and the vision of introducing international flavours to India, in support of the 'Make in India' initiative. I've observed that 'Scuzo' is often perceived as an international brand, and this perception inspired me to establish it. My ultimate goal is to promote 'Make in India' and expand its global footprint. This is why I chose a name that resonates with audiences worldwide.

Tell us about the difference in sales with regards to take-home ice cream and impulse buy ice creams.
The ratio between sales in regards to take-home ice cream and impulse buy ice creams is 40:60.

Give us your thoughts on the future prospects of low calorie and keto ice cream options in India.
The future of low-calorie and keto ice cream options in India looks promising. Many people are seeking healthier alternatives, including ice creams with fewer calories that fit their keto diets. These ice creams are gaining popularity because they allow people to enjoy something sweet without feeling guilty. In India, where traditional sweets hold a special place in people's hearts, these ice creams provide a compromise between indulging in dessert and maintaining a healthy lifestyle.

People can also consider switching to gelato, as it is a healthier option. Brands producing these ice creams need to ensure that their products not only taste great but also provide a satisfying texture. Collaborating with nutrition experts can help ensure that these ice creams meet specific dietary needs.
In short, low-calorie and keto ice creams, including gelato, have a bright future in India because people are eager to savour delicious desserts while prioritising their health.

Do you see an uptick in manufacturing and supplying of dairy-free/vegan ice cream, why?
There is indeed a noticeable increase in the production and availability of dairy-free and vegan ice cream, and several factors contribute to this trend. First, more people are embracing plant-based diets or reducing their intake of animal-based products, driving up the demand for non-dairy ice cream. Additionally, many individuals are becoming health-conscious and seek options that are lower in saturated fats and cholesterol, which are commonly found in traditional dairy products.

At Scuzo, we have many dairy-free and vegan gelato flavours that lots of people love. People really like them because we have so many choices, and they taste and feel just like regular gelato.

What is the company’s long-term plan for sustainability?
We have a comprehensive long-term plan for sustainability, which includes several key initiatives:
    • Master Franchise Model: We operate on a master franchise model. The company has already successfully sold master franchises for regions such as Andhra Pradesh, Telangana, Punjab, Rajasthan, Himachal Pradesh, and Gujarat. These franchises are operated by independent individuals or businesses that have acquired franchise rights from us. Our goal in opening stores in these areas is to build a strong presence and attract many customers. This way, we can better serve the different tastes and needs of each region. When we open several stores in one area, like our successful venture with seven stores in Andhra Pradesh, we can plan to have our own production facility there. This helps us manage our supply chain effectively and deliver our products to meet the growing demand in that region on time.
    • External Funding: Currently, the company is actively seeking external investments from investors to support its growth. It aims to secure approximately $1 million in investment, which equates to around Rs 7-8 crore. This funding will play a crucial role in advancing the company's sustainability efforts.
    • Allocation of Funds: Of the total investment, roughly half will be dedicated to marketing efforts, both in the B2B (business-to-business) and B2C (business-to-consumer) segments. The remaining funds will be strategically allocated to enhance backend operations, foster franchise development, and improve infrastructure.
    • Master Franchise Expansion: The company's future plans involve adopting the master franchise model in every territory. This expansion strategy includes opening two more outlets in each territory and ultimately covering the entire Indian market through an extensive master franchise network.
    • International Expansion: Beyond the Indian market, we are actively exploring international opportunities. The company is in discussions with various clients and is poised to expand its network to regions such as the Middle East, Sri Lanka, Canada, and the UK, further contributing to its long-term sustainability goals.

This comprehensive plan reflects our commitment to growth, sustainability, and the vision to become a prominent player in the dessert and sweets industry, both nationally and internationally.

What are the key factors that would differentiate your brand from the existing brands in the market?
We are committed to differentiating ourselves from existing brands in the market through a combination of unique features and a dedication to customer satisfaction. Here are the key factors that set us apart:
    • Unique Live Popsicle Concept: We recognised the need to provide customers with a one-of-a-kind experience. Our live popsicle concept allows customers to actively participate in creating their own fruity delights. They have the freedom to select their preferred fruits and witness the real-time production of their favourite fruit popsicles. This interactive experience distinguishes us from competitors.
    • 100% Natural Products: Our commitment to using 100% natural ingredients is a core differentiator. Our desserts are free from added preservatives or artificial additives. We prioritise the use of natural ingredients to ensure the highest quality and flavour while addressing the concerns of customers with specific allergies.
    • Gelato Instead of Regular Ice Cream: Unlike traditional ice cream, we offer gelato, a lighter and healthier alternative. Gelato contains less fat and oil while using 100% cream, resulting in fewer calories. This choice aligns with our focus on providing healthier dessert options to our customers.
    • Sustainability Initiatives:  At our company, we have undertaken various sustainable initiatives to reduce our environmental footprint and promote mindful consumption. One of our most exciting innovations in this regard is the introduction of rice straws coloured with edible flavours that are not only safe for consumption but also environmentally friendly. We are excited to announce the introduction of edible food packaging, specifically edible spoons designed for enjoying gelatos.We want our customers to enjoy our delicious treats without worrying about harming the environment, making their experience even more delightful.
    • Commitment to Quality and Innovation: Quality and innovation are at the heart of our brand. We consistently strive to deliver superior taste and product innovation that surprises and delights our customers. This unwavering commitment ensures that we remain at the forefront of the industry.
In terms of competition, as a gelato brand rather than a traditional ice cream vendor, we consider ourselves distinct and not in direct competition. Furthermore, our target audience is quite different. We are dedicated to serving health-conscious and discerning customers who prioritise a healthier product. Our primary goal is to establish a robust reputation and brand presence within this specialised market segment.

Whether our competitors are national or international, our unique live popsicle concept, focus on natural ingredients, sustainability efforts, and dedication to quality and innovation set us apart in the market. These factors collectively contribute to our brand's distinct identity and position in the dessert industry.

What are the challenges faced by the company in this space?
There are a myriad of challenges that must be tackled in an efficient manner in this space. Some of the more prominent ones include the logistical challenges associated with the supply of our raw materials or products to different parts of the country. It requires us to take into account the dynamic fluctuations in transport fares and the availability of said transport. Seasonal variation and the difference between the price points of naturally produced products and artificially produced products play a hand in adding to the challenges that we come across.

What is the company’s revenue for FY23, and what are you expecting?
In FY23, the company achieved a revenue of Rs 5.3 crore. We are setting a target of Rs 10 crore for FY24.

What are the company’s plans on future collaborations?
We are actively exploring future collaborations as part of our growth strategy. Discussions with Filipino brands are underway, with the goal of introducing their products in our stores to enhance customer choices. Additionally, the company is in talks to expand internationally, focusing on markets like Canada, Australia, and the Middle East. Once established in a new country with our flagship outlets, we plan to rapidly expand its presence by opening multiple stores. Alongside global expansion, the company aims to promote "Make in India" by showcasing Indian flavours and culinary expertise abroad. These initiatives reflect our commitment to expanding brand presence and contributing to the global culinary landscape. Furthermore, we are looking forward to establishing our own manufacturing units in Punjab, Andhra Pradesh, and Rajasthan as part of our continued growth.

Do you plan on launching new products in light of the changing trends in the industry?
Yes, staying up to date with both market trends and opportunities is a crucial aspect for any business. In our efforts to do the same, we have launched a wide variety of products, including our boba tea range, a new range of popsicles & gelatos in unique flavours to attract both youth and the elderly. We have also launched a variety of hot and savoury products.
 
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