The 2018-19 edition of India Food Report – a biannual publication brought out by the IMAGES Group under its India Food Forum knowledge initiative – has been released to widespread industry plaudits and acknowledgement by the Government ministries concerned.
As with the earlier editions of this widely trusted most authoritative report on India’s Food Retail, a lot of data, research and analyses have gone into its preparation – put together by IMAGES research and with inputs from some of the world’s most respected consulting and/ or market study organizations, retail business heads, brand analysts and consumer research companies.
The report offers extensive mapping, sizing of the food manufacturing, marketing and retailing sectors, benchmark figures on consumer spends and retail market size across key food categories and segments, opportunities for business and growth in key areas of food retail, along with observations by industry experts on key consumption trends, new concepts in F&G, FMCG, and F&B. Besides IMAGES research, the organizations and experts who have contributed to the making of the report include Mintel, Euromonitor, Technopak, GS1, Deloitte, Wazir, Maple Capital Advisors, CBRE, FIFI, to name a few.
Conveying his warm wishes on the publication of the report, Minister for Consumer Affairs, Food and Public Distribution, GOI, Ram Vilas Paswan said: “In today’s complex and interdependent food supply chain, food safety is a shared responsibility of the farmers, the food industry, regulators as well as consumers. I hope that this report will help inform and educate the consumers and will contribute to the industry knowledge.”
The Minister of State for Food Processing Industries, GOI, Sadhvi Niranjan Jyoti welcomed the publication of India Food Report 2018-19 and hoped that it will help to frame a better understanding of the myriad aspects of India’s food industry for the stakeholders to tap its potential more optimally.
“I am happy to note that The India Food Report takes a holistic view of the food sector and highlights the potential areas for producers and sellers to know about the upcoming trends and scope in the food business. The Government is taking various initiatives to unleash and harness the country’s potential in horticulture, aquaculture and other allied sectors, which will pave the way for India to emerge even stronger in the world food market.”
Pawan Agarwal, Secretary to Government of India and Chief Executive Officer, FSSAI said he hoped that the insights contained in the India Food Report will serve as a basis for further discussion in contributing to a future food system where safe, hygienic and nutritious food is available to one and all.
Today, as the Indian economy is looking at opportunities for growth and employment generation, the food sector can act as an engine to pull the economy on the tracks of accelerated progress. This report highlights the potential of India’s Food sector – both Food & Grocery and Food Service – and suggests key interventions necessary for the sector’s sustained growth. The report looks at key business opportunities within these sectors, focuses on the investment potential and stresses on key challenges that need to be addressed.
Expressing his thanks to all contributors of the report, Amitabh Taneja, CMD and Editor in Chief IMAGES Group said, “It gives me great satisfaction to note that India Food Report 2018-19 has been compiled with the contributions of leading consultancies, think tanks and experts associated with India’s large and varied food industry and will offer a comprehensive understanding of India’s Food sector and prove useful to all stakeholders.”
Key Findings of India Food Report 2018-19
The findings of IMAGES Research for the India Food Report 2018-19 reveal that food consumption in India is on a consistent rise. Total food consumption in India has grown at a CAGR of 11.6 percent to reach Rs 25,81,279 crore (US $403.3 billion^) during 2015-16 from Rs 16,63,041 crore (US $259.8 billion^) during 2011-12. Food consumption at the domestic level includes food grocery (FG) items in raw and processed form primarily prepared and consumed at the household level along with food service (FS) in the form of food & beverages (F&B) cooked and served at various service points outside the household. Consumption in the FG segment grew at a CAGR of 12.1 percent and in FS segment it grew at 7.2 percent during the period.
With food consumption increasing every year, India’s Food Retail market (excluding non-food grocery) is estimated at Rs 35,38,282 crore (US $552.86 billion^) in 2017 – a market size of more than half of India’s total retail market. Growing at a CAGR of 14.4 percent, the market will grow to a size of Rs 53,05,488 crore (US $828.98 billion^) in 2020. The Food Retail market is dominated by Food Grocery (FG) segment with about 90 percent share in the total market; the other 10 percent share is held by the Food Service (FS) segment. Organized retail in the FS segment is growing at CAGR of 15 percent and is 34.5 percent of the total FS market whereas the share of Modern Retail in the FG market is 2.6 percent, growing at CAGR of 25 percent.
The Report finds India’s FG Retail market is worth Rs 31,98,261 crore (US $499.7 billion^) in 2017 and is expected to reach Rs 48,52,920 crore (US $758.2 billion^) in 2020, growing at a CAGR of 14.9 percent. Obviously, it is in the interest of all stakeholders to help modernize such a large market with suitable policy support, improved supply chain, food quality standards, adoption of technology and skilled and trained manpower. Retailers need to upgrade their operations for serving customers better by implementing best international retail practices. Being a daily shopped segment, the FG market can never experience a shortage of demand and growth and FG retailing in India is set to continue on a forward trajectory of growth.
On the other hand, the FS retail market in India is estimated to be worth Rs 3,40,201 crore in 2017 (US $53.13 billion^) and is growing at a CAGR of 10 percent. By 2020, the market is estimated to reach the size of Rs 4,52,733 crore (US $70.7 billion^). The organized share of the market is valued at Rs 1,17,307 crore (US $18.3 billion^) while the unorganized market share is estimated to reach 59 percent in 2021 from 67 percent in 2016.
The large metro-cities of Delhi and Mumbai are estimated to have over one-fifth of the organized FS market, each contributing equally. Another one-fifth share is contributed by the other six metros of Pune, Ahmedabad, Bengaluru, Hyderabad, Chennai and Kolkata, together, with the balance share being contributed by other Tier I & II cities spread across the country.
With Indian consumers fast adopting the eating out culture as a way of life, there is a huge scope for multiple cuisines, related services, innovative concepts and formats to emerge and grow. The market has a tendency to appreciate consistently unlike many other retail segments that have a fluctuating growth pattern. In light of its unique ability to become organized fast, the FS market would be among the many firsts to turn up being 100 percent modernized. Quite obviously, companies that can modernize, traditional regional foods/ recipes making them more convenient to use/ consume will emerge as winners and the potential is immense.
The India Food Report 2018-19 explores the current and future dynamics of the industry from the perspective of industry experts with plenty of creative ideas aimed at strengthening and reframing our understanding of the trends and disruptions shaking up modern food retailing. It has a treasure trove of insightful data and analyses on Food Retail and FMCG markets in India, in particular:
– Food & Grocery Sector: market sizing, overview, trends, opportunities
– Food Services Sector: market sizing, overview, trends, opportunities
– New Concepts in F&G, FMCG, and F&B: business models for driving the way forward
– Food Processing Sector in India: business opportunities in processed foods
– Food Safety: key regulatory issues, bottlenecks and ensuring the ease of doing business
– International Foods: high growth segments and ways to make the market more vibrant
– Food Retailing in India: market dynamics and future outlook
– Consumption Trends: gaining higher wallet share by tapping emerging shopping habits and consumer behavior
– ‘Make in India’ for Food Sector: scope of manufacturing and marketing for scaling up India’s contribution to world food trade