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Unorganised ice cream players’ issues - high taxation & poor logistics
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Monday, 03 March, 2014, 08 : 00 AM [IST]
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Akshay Kalbag, Mumbai
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fiogf49gjkf0d The unorganised ice-cream sector in India - which is estimated to be worth Rs 3,200 crore - is grappling with four problems, namely the high rate of taxation
levied upon them by the government; inadequate logistic support, the
lack of electricity and the fact that there is a lack of control on this
segment of the industry.
Vijay Vasant Gaitonde, proprietor, Jyot Dairy, Mumbai (which sells the sweet treat under the brand name Festival Ice Cream), stated that there are about fifteen organised players and at least 15,000 unorganised players in India. “It is growing at about 20% per annum,” he said. A small firm that started operations in 1994, Jyot Dairy plans to expand in the future.
However, Tarun Sikka, managing director, Star Foods Specialty - which brought the Swiss brand Movenpick (which was established in 1961) to India - said that about 60 per cent of India’s ice cream brands constitute the organised sector (which is estimated to be worth Rs 10,000 crore, and includes the likes of Amul, Unilever and Creambell).
“The unorganised segment comprises regional players who cater to specific geographies - either a group of cities or states - through small stores,” he added.
Gaitonde said, “We do not export ice cream, but we have collaborated with Sweetheart Ice Cream, a brand based in the United Kingdom. We would also start our export division shortly.”
Problems the sector faces
Movenpick is in the super premium dessert segment, whose biggest cause for concern, according to Sikka, is the rising cost of real estate. “To have our presence in the most upmarket locations in major cities has become an expensive affair. But to sell a premium product, we need to be in the right space, and it is not easy to find a space that strikes a balance between location and rent,” he added.
Regulatory norms
Gaitonde and Sikka stated that as was the case with every category of food products, ice cream was also under the purview of the hygiene norms laid down by the Food Safety and Standards Authority of India (FSSAI), the country’s apex food regulator.
Flavours
Gaitonde said, “Festival Ice Cream is currently available in about 75 flavours, and additions are in the pipeline. To the best of my knowledge, we are perhaps the only company who do not only manufacture ice cream, but two Indian variants of the sweet treat - kulfi and sancha - under one roof.”
In India, Mövenpick range includes 18 flavours of ice cream and sorbet; ice cream dessert creations; gourmet selections; sundaes shakes and fat-free refreshments. “Some of the ice cream flavours served are Vanilla Dream; Swiss Chocolate; Strawberry; Maple Walnut; Cappuccino; Mint Chocolate; Hazelnut; White Chocolate; Banana; Pistachio; Mango; Raspberry and Strawberry; Coconut and Swiss Chocolate; Panna Cotta; Black Currant and Cream, Mango and Cream and Black Currant.
No Indianisation
When asked if Movenpick plans to alter their flavours to suit the Indian palate, Sikka stated, “I don't believe we need to. Indians are now looking for premium tastes with international quality and standards. Mövenpick has a unique Swiss offering that has been well-received in over 40 countries around the world. Our mission is not to try and offer an Indian version of our brand, but to simply showcase Mövenpick's unique brand and its uniformity. Indians have always been passionate about food, and we hope the response to our gastronomic delights would be good here.”
Product differentiation vis-a-vis the competition
“The ice cream variants of our company are unique and are not comparable to any rival product. What makes them stand out is their taste, coupled with a mixture of tradition and technology used to make them,” Gaitonde stated.
“There are three key dimensions to Mövenpick ice cream that differentiate it in the market,” said Sikka.
“The first is our passion for gastronomy. Mövenpick is an ice cream made by chefs for chefs. It was created for fine dining restaurants in Europe, and that region’s gastronomic heritage is at the heart of all our unique recipes. It is this that allows us to create flavours such as Tiramisu, Panna Cotta and Crème Brulee, to name a few,” he added.
“The second dimension is our all-natural policy. All our ice cream is made only using 100 per cent natural ingredients with no artificial colours, flavours or additives. Only the finest ingredients, sourced from all over the globe, are used in our recipes,” Sikka stated.
“For instance, our mango sorbet only uses Alphonso mangoes from India, and the cocoa used in our Swiss Chocolate is sourced from a region in Venezuela renowned for the finest cocoa in the world,”.he pointed out.
“Our third dimension, of course, is Swiss perfection - all our ice cream is made there. Only Swiss cream is used, and it adheres to an exacting standard,” Sikka said.
Packaging
Festival Ice Cream is packed in ITC board packs. Gaitonde said, “Ice cream is stored at a low temperatures in order to increase its shelf life.”
“Star Foods Speciality has invested heavily in the supply chain so as to ensure that there is always a cold chain for the ice cream, no matter what part of India we ship to,” Sikka added.
About Movenpick
“Movenpick owes its inspiration to a vision of culinary excellence that swept through Swiss restaurants in the 1960s. The man behind the brand was Ueli Prager, a Swiss hotelier’s son. His passion for fine food culminated in the opening of Movenpick’s first restaurant, in Zurich in 1948,” Sikka said.
“These desserts are now served at over 300 boutiques across three continents (Europe, Asia and Australia), and in five-star restaurants and hotels in over 40 countries. As far as our presence in India is concerned, we have a retail presence in Kolkata and Chennai, and are keen to expand. In fact, we recently launched the Movenpick Ice Cream at Select City Walk in New Delhi,” Sikka added.
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