Food & Beverage News: F&B Specials - Convenience food high on the shopping list

Indian convenience food industry, including frozen foods, ready-to-eat or ready-to-cook and ethnic Indian cuisine, is growing day by day. There are more than 10 sectors in the convenience foods market in the world namely meat and meat products, poultry and poultry products, ice cream, fish and fish products, ready meals, potato products, cakes and desserts, pizza, fruits and vegetables, and vegetarian foods.

According to industry experts, the development of the industry has been heavily influenced by two of the key factors affecting food markets over the past 40 years growing demand for convenience products and concerns about health. Frozen foods were one of the first beneficiaries of the demand for convenience products like frozen foods, boil-in-the bag meals and ready meals.

Within the frozen food market, fish, poultry and ice cream probably have the greatest growth potential. The frozen foods continue to offer advantages in term of convenience and bulk buying and are a long established item on consumers' shopping lists. They also offer benefits in terms of health; they do not contain the preservatives found in chilled products that have yet to be fully exploited by the industry, the experts pointed out.

The ready-to-eat industry of Indian foods is taking off as the demand from global Indians, NRIs and others looking for convenient food. This demand for ready-to-eat meals has captured a large amount of the food retail market in India and around the world.

According to a Food and Beverage Survey conducted by the Federation of Indian Chambers of Commerce and Industry (FICCI), the ready-to-eat food sector is growing by 20% annually. And that's a substantial figure of growth in the Indian food and beverage industry worth Rs 3, 58, 400 crore.

The sheer variety that's available on supermarket shelves and the local kirana stores is mindboggling. MTR, ITC, Tasty Bite, Currie Classic and Kohinoor offer customers several ready-to-eat options in regional category to choose from; so the choice is from kharabath, palak paneer, baghare baigan, Kashmiri rajma, avial and even the evergreen dal makhni. Costing as little as Rs 25 and going up to Rs 150 (dal Bukhara), the ready-to-eat packs are clearly here to stay, the report says.

The report also says that jostling for shelf-space with economically priced read-to-eat packs are ITC's premium tins comprising; dal Bukhara, dal Dakshini, chicken Chettinad, mirch ka salan, Awadhi badam halwa.

The ready-to-eat market today is worth Rs 70-80 crore (discounting the bigger ready-made market comprising juices, noodles etc which together put the market cost to Rs 1,000 crore). Upbeat about the growth potential, top producers MTR, Kohinoor, Tasty Bites, Indo-Nissin, Currie Classic, HLL, have stepped up production, and expanded their range of products.

Tasty Bites (a wholly owned subsidiary of Preferred Brands International) a US-based food company which has been marketing its Tasty Bite line of ready-to-eat Indian foods in the US since 1994) which closed shop after a poor response a decade ago, has reopened business with renewed enthusiasm.

With manufacturing capabilities in three countries, Tasty Bite claims to be the largest selling brand of Indian food sold in the US and is also available in 11 countries including Japan, India, Singapore, Australia and New Zealand.

MTR who started the ready-to-eat segment way back in 1998 is set to project Rs 500 crore sales over the next five years, riding on the wave of the ready-to-eat foods market.

MTR products currently reach one lakh outlets across India. We have about 65% share in the ready-to-eat market. In north India, the market for us has grown 25%, while in south we have grown 50% in the last one year. With restaurant costs escalating in the US, Japan and even India (if you think premium restaurants and five-stars), gourmets have an easy option to buy ready-made packs without spending a bomb or spending too much time getting ingredients to make them. In 1998, the ready-to-eat food market was a paltry Rs 6 crore. But by the year 2008, it is expected to touch Rs 300 crore, so there's plenty of reason to cheer for us, company sources said.

ITC Foods is all set to invest Rs 450 crore in the next three years (besides the estimated Rs 150 crore it has already put in) in the branded food market. As for the ready-to-eat food market, ITC has created two distinct segments - the upper end catered through the Kitchens of India brand and the middle level market through the Aashirwad series. Aashirwad is available in 15,000 retail stores, while Kitchens of India is available at 7,000 outlets.

Industry sources told Food & Beverage News that the frozen convenience foods are convenient, quick to prepare and tasty, making them a great fit for today's typically time-crunched American. Whereas convenience used to mean sacrificing quality for speed, frozen foods now score high in both quality and flavour, with items like frozen meal kits making it easy for consumers.

US retail sales of gourmet, specialty and premium foods and beverages are growing at much faster rates than those of the overall food and beverage industry, surging 10.9% to $59.0 billion in 2007 and posting a compound annual growth rate of 11.1% for the 2003-2007 period.

The opportunities for exporting Indian Convenience food to US market is huge but we should keep in mind the US FDA rules and regulations for imported food articles as well as the Sanitary and Phytosanitary measures, the industry expert added.