India Food Forum highlights increased formalization of food services beyond tier-II cities
New Delhi: India’s organized food services are poised to double its revenue in the next six years, but managing input cost is becoming a challenge, said Ravindra Yadav, Partner – Retail & Food Services, Technopak – a consulting firm.
“Same stores sales growth is down while raw material, manpower cost, rentals and maintenance costs are high,” Yadav said delivering his keynote address on the second day of the 17th India Food Forum.
The significant growth driver in good services is seen more driven beyond metro and tier I and II cities that will see market size double to $120 billion in the next six years from $61 billion now through the formalization of the informal market.
“Organised chain food market is seen rising to 21% by 2030 from 15% now while unorganized informal market will decline to 41% from 52% during the same period,” Yadav said.
Moreover, metros, the next six cities in Tier I and the next 21 cities in Tier II cities have grown by 6.5% to $11 billion, 6.9% to $10 billion and 12. What 8% to $5 billion, respectively from 2019-2024 while the rest of India grew at 25% to $3 billion.
During the financial year 2023-24, Westlife, Devyani, Barbeque and Speciality Restaurants all reported revenue growth of 5%, 18.6%, 9.6% and 4.8% but their operating profit declined by 1.3%, 0.5%, 4.3% and 11.7%, respectively, Yadav said.
The pressure on profitability is also seen from the fact that competition is becoming hyper-local for big food chains at local levels, he said.
Earlier, on day one of the two-day India Food Forum, RS Sodhi, President of, the Indian Dairy Association pointed out that Gol-gappa or Pani-puri has a market of Rs 70,000 crore and around 10% of it is becoming organized with a lot of further potential. Think about other Indian conventional snacks like Kachori and Samosa and the market potential that it can be unlocked, Sodhi said.
India Food Forum is the country’s largest food B2B intelligence and exhibition platform with a unique combination of wide-ranging product displays, two-day conference and masterclasses, networking and business development opportunities, food D2C, tech & solutions showcases and India’s most prestigious awards for food & grocery retail and food service sectors.
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