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Thoughts on business of food from Food Forum India

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The Food Forum India, the largest congregation of key global and Indian food retailers, manufacturers, organisations and minds in the food business, opened today in Mumbai.

Presenting points from Mc Kinsey & Co.’s research on the Indian food market, Ireena Vittal, principal, Mc Kinsey & Co., in the session ‘Food for Thought’ said: “Industry must concentrate on betterment of supply chain management, as this can hamper the industry’s growth in future. The margins problem is a secondary issue.”

Stating that “business as usual will not work,” Vittal brought out a few significant findings on the market including a need for convenience among Indian consumers, a tendency of experimenting with food, peculiarity about the freshness of food, and a relatively lesser understanding of branded food.

Pointing out the hurdles of the market, Vittal said that India was an undeveloped, unbranded market, ridden by lower levels of innovation, increased wastage, and weak linkage between supply and demand chains. “There is a need for mindset for supply security and quality security, about innovation and derisking low cost source through world-class inputs.”

In session ‘Food Vision 2020’, Martin Dlouhy, MD, Metro (India), informed that the cash-and-carry major’s business strategy involves a vertically integrated approach in which they seek to connect markets and farms. On the future of vendors and traditional grocers, Martin declared, “I can assure you that you’ll see plenty of kirana stores.”

“Kiranas will never compete on price. They’ll compete on personal touch.” Other panellists on the session were Kishore Biyani, founder and CEO of Future Group; S Dave, director, APEDA; and Ireena Vittal.

Panellists had a healthy debate on the supply chain issue, while Dave advocated a greater role for private players in organising the chain between the farm and the plate, Kishore Biyani stated, “All that a retailer can do is buy, and sell to the consumers.” Vittal remarked, “We need is to envelope the farmers and educate them on when to grow and what to grow.” Dave added that the self-help groups and the NGOs can be of great help to retailers in organising the farmers.

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