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“We have plans to establish wholesale sweet shops”
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Monday, 06 May, 2024, 08 : 00 AM [IST]
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 Scandalous Foods is a pioneering venture aiming to create a category of post-meal impulse buying consumption of Indian sweets, using restaurant & catering industry as channels to sell sweets to end consumers.
Functioning as a comprehensive solution for the procurement of Indian sweets, the company envisions making sweets as commonplace as ice cream in the dining experience. With a commitment to quality and innovation, it offers preservative-free sweets with a remarkable 6-month shelf life, available in convenient single-serve sizes.
Sanket S, founder, Scandalous Foods, shares insights on the India sweets industry and post-meal offering category trends and challenges in an email interaction with FnB News. Excerpts:
How has the landscape of Indian sweets production and distribution evolved in recent years?
Leveraging creative flavours, delivery-based convenience, and premium positioning, they are redefining sweets for the modern palate. Their sweet-centric business models cater not only to the enduring love for traditional recipes but also to evolving preferences for artisanal quality, experimental tastes, healthy ingredients, and bite-sized convenience.
While most startups have taken to targeting the premium and affluent customer audience, we’re looking at targeting the affordable segment. It is a huge segment, which is sweets-hungry and not as fussy as the mass premium and premium customers.
In recent years, the landscape of Indian sweets production and distribution has undergone a transformative shift, characterised by innovative approaches to flavours, convenient delivery services, and a focus on premium positioning. The industry has witnessed a redefinition of traditional sweets to align with the preferences of the modern palate. Many startups have emerged, emphasising sweet-centric business models that not only honour the enduring love for classic recipes but also cater to the changing tastes of consumers seeking artisanal quality, experimental flavours, healthier ingredients, and bite-sized convenience.
While the majority of these startups have targeted a premium and affluent customer base, there is a notable shift in strategy. Some businesses are now aiming to capture the affordable segment, recognising its vast potential. This segment, characterised by a significant demand for sweets and a less discerning consumer base compared to the mass premium and premium markets, presents a lucrative opportunity for those looking to tap into the broader consumer base.
What are the emerging trends in the post-meal offering category?
The post-meal offering category is witnessing the emergence of several noteworthy trends, particularly in the realm of sweets. A shift towards healthier options is apparent, with a focus on innovative, artisanal, and handcrafted fusion sweets. This trend is reflected in the introduction of bite-sized pedas, petit gulab jamuns featuring fun flavours, and the advent of mithai bars. These developments position sweets as snackable accompaniments to everyday meals and beverages, catering to the evolving preferences of consumers.
Additionally, akin to the popularity of shampoo sachets in India, there is a growing belief that the concept can be extended to mithais. The introduction of mithai sachets, bars, cookies, waffles, and cakes is envisioned, presenting a convenient and accessible format for consumers. Despite the emphasis on novelty, the essence of taste remains rooted in familiarity. This strategic approach seeks to balance the allure of new and exciting offerings with the comforting and traditional flavours that resonate with consumers.
Elaborate on the role of the restaurant and catering industry as channels for selling sweets to end-consumers.
The restaurant and catering industry plays a crucial role as channels for selling sweets to end- consumers, particularly in tapping into the significant white space of impulse buying observed in India. This is primarily post-meals and leveraging hotels, restaurants, and caterers as indirect sales channels becomes pivotal here.
Sweets are strategically incorporated into restaurant menus and catering packages to enhance the overall dining experience. By ensuring that sweet offerings complement main courses, restaurants encourage customers to explore and indulge in dessert options, thereby driving additional sales.
Catering services, in particular, offer a valuable avenue for customisation. This flexibility allows for tailoring sweet offerings to suit the specific nature of events, whether they be weddings, corporate gatherings, or special occasions. This personalised approach enhances the overall dessert experience, creating memorable moments for consumers.
In the digital era, the restaurant and catering industry capitalises on online platforms to showcase its sweet offerings. Through visually appealing images, detailed descriptions, and customer reviews, these platforms serve as effective marketing tools, attracting potential consumers and driving engagement in the competitive sweets market.
What are the challenges faced by the company in the food industry?
We encounter several challenges, including issues in the supply chain, logistics, market education about frozen sweets consumption, effective cost management, and coping with the impact of external factors. These external factors may involve a disturbance in the cold chain logistics that could occur due to power outages or breakdowns in refrigeration systems during transportation. These challenges are akin to crucial pillars of support that involve strengthening the supply chain, enhancing market education efforts, upskilling the workforce, and overcoming mental blocks to adapt to new technologies.
How does the company plan to stay ahead of changing consumer preferences in the food industry?
We have a proactive approach to stay ahead of evolving consumer preferences in the food industry. This involves leveraging data analytics tools to meticulously analyse sales data, customer behaviour, and market trends. In addition to data-driven strategies, the company emphasises continuous innovation and dynamic marketing approaches. The key focus lies in aggressively expanding the distribution network, a move supported by robust data analytics. Recognising that a good product is a baseline, we aim for sustained success through a combination of innovation, strategic marketing, and a well-informed, growing distribution footprint.
Address cultural considerations and regional preferences when offering a variety of Indian sweets.
Our approach has evolved when it comes to considering cultural aspects. Initially focusing on popular options during the Minimum Viable Product (MVP) phase, our strategy has shifted to include a diverse range of sweet offerings. This expansion now encompasses seasonal, regional, and occasional sweets, recognising the rich diversity and varied tastes prevalent across different cultures in India.
How are businesses responding to the increasing demand for healthier dessert options in the market?
One prevalent strategy for businesses to address this rising demand involves incorporating health-conscious ingredients, such as sugar alternatives like dates and jaggery, as well as unrefined sugar. We are also introducing small-sized single serves and innovatively packaging desserts into sachets and bars. This approach not only aligns with the demand for healthier options but also emphasises convenience and portion management in response to evolving consumer lifestyles.
How does the company approach sustainability in its production processes?
While still in its early stages, we are actively addressing sustainability in its production processes. Although being a relatively young venture, there is a conscientious effort to minimise the carbon footprint. This includes sourcing milk directly from cooperatives and bypassing distributors and retailers to streamline the supply chain. We also opt for refrigerated vans powered by CNG and EV technology instead of diesel wherever feasible. Furthermore, a dedication to reducing environmental impact is evident in the adoption of reusable packaging.
How do you see the future of the post-meal impulse buying market evolving?
We anticipate pioneering a new category within the post-meal sweets market, recognising it as a significant white space that can be as huge as the traditional mithai industry in the coming years. This category is designed to offer convenient, guilt-free indulgence, addressing the psychological needs of a broad consumer base.
Convenience will be the future trajectory of the post-meal impulse-buying market. Snack-sized portions, on-the-go packaging, and easily consumable options will remain key drivers, attracting consumers seeking quick and hassle-free treats after meals.
As health and wellness gain prominence, the market is expected to witness a surge in demand for healthier post-meal impulse options. Businesses are likely to introduce snacks and treats that align with diverse dietary preferences, catering to the growing segment of health-conscious consumers.
What are the future plans for the company?
We are strategically charting a path for future expansion with multifaceted plans. Firstly, there is a focus on amplifying B2B channels and expanding collaborations and partnerships to enhance market reach and penetration. In addition, the company is eyeing the market landscape by venturing into exports. This move aims to capitalise on global opportunities and introduce the brand to a broader audience.
On the B2C front, we also have plans to establish wholesale sweet shops, catering directly to consumers. This initiative aligns to create a more direct and personalised connection with end- customers. Furthermore, we are gearing up for the retail market by developing general trade ready products. These products will be available in both ambient and chilled formats, ensuring versatility in meeting diverse consumer preferences. Overall, these strategic initiatives reflect the company's comprehensive vision for growth, encompassing both domestic and international markets through varied B2B and B2C avenues.
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