Urbanizing double-income households, changing lifestyles and food preferences are spurring the organized market within the dining out sector. Fast food has become highly palatable to the teens and consumers in their early twenties, with international fast food chains like KFC and McDonalds, Subway, Domino’s Dunkin Donuts particularly popular.
Indian food services industry is estimated to be nearly worth USD 41.3 billion and is growing at a healthy compound annual growth rate (CAGR) of 11%.
The size of Organized Indian QSR market is $0.62 bn, growing at a healthy CAGR of 20% and is expected to reach $1.1 bn by 2017-18.
Indian QSR incluses Cafes, Pizza Outlets, Other International Cuisines like Burgers, Sandwiches, Pubs and Bars, Indian Ethnic Cuisine, Ice Creams, Street Food, Bakeries, Confectionery.
1. OPPORTUNITIES IN THE INDIAN FOOD SERVICE
MARKET
QSR, CASUAL DINING, FINE DINING, VENDING
2. SUMMARY
•The Indian Food Service Industry is worth $41.3 bn and growing at a CAGR of 11%. It is expected to reach
$68 bn by 2018.
•The size of Organized Indian QSR market is $0.62 bn, growing at a healthy CAGR of 20% and is expected
to reach $1.1 bn by 2017-18.
•Delivery segment is a integral part not only of the Indian Food Service segment, but is also common for
Grocery stores, Liquor stores, vegetable vendors etc.
•Major cities comprise of large workplace clusters and high density residential areas. Young Indian
Consumers are highly price sensitive.
18%
40%
31%
11%
Age Group Profile of Those Who Eat Out
18 to 20 years
21 to 30 years
31 to 40 years
above 40 years
3. CONSUMPTION EXPENDITURE COMPOSITION, FY 2013
Recreation, Education,
3%
Furniture, Appliances,
6%
Personal Care, 5%
Health, 5%
Clothing and Footware,
8%
Rent, Fuel and Power,
9%
Transport and
Communication, 17%
Food and Beverages,
30%
RETAIL MARKET OUTLOOK, FY2017
0%
5%
10%
15%
20%
25%
-10% 0% 10% 20% 30% 40% 50% 60%
CAGR(FY12-17)
Consumption
4. 25% OF OUR YOUTH PREFER HANGING OUT WITH THEIR
FRIENDS OVER OTHER OUTDOOR ENTERTAINMENT ACTIVITIES
Favourite outdoor entertainment activity 13-18 years 19-24 years Gen Next(all youth)
Projected base 93,18,951 129,923,462 223,142,413
Movies at Cinema hall 13.90% 16.60% 15.50%
Go dancing at discos 0.40% 1.40% 1.00%
Pubbing/drinking with friends/family 1.20% 1.60% 1.50%
Eating Out 9.70% 10.40% 10.10%
Entertainment Parks 4.80% 5.90% 5.40%
Shopping/Window Shopping 4.70% 5.20% 5.00%
Spiritul sessions/satsangs 5.80% 8.90% 7.60%
Watch art & culture performance/events 4.40% 4.10% 4.20%
Generally hangout with friends 27.00% 23.80% 25.10%
Go for long walks 4.60% 6.80% 5.90%
Read in libraries 4.70% 4.20% 4.40%
Go on long drives 0.90% 2.30% 1.70%
Play favourite sports 8.10% 6.20% 7.00%
Going Out/picnic with family 7.20% 8.00% 7.70%
Visit Relatives/neighbours 15.70% 16.60% 16.20%
None 40.40% 37.30% 38.60%
Marketing Whitebook
5. 73% OF THE YOUTH CONSIDER PRICE THE MOST IMPORTANT
CONSIDERATION WHILE MAKING PURCHASES
Buying Orientation 13-18 years 19-24 years Gen Next(all youth)
Projected Base 93,218,951 129,923,462 223,142,413
Brand Image 64.00% 61.20% 62.40%
Price 73.00% 72.70% 72.80%
Performance quality 36.50% 37.40% 37.00%
Premium/advance features 13.80% 16.40% 15.30%
Design And Looks 30.10% 23.90% 26.50%
Ease of Usage 25.00% 27.90% 26.70%
Shopping Experience 15.70% 17.00% 16.50%
Reputation of the Company making the product/service 12.00% 11.70% 11.80%
Ease of payment/payment option available 9.60% 9.70% 9.70%
What most people around you are buying/using 7.10% 9.60% 8.50%
Recommendation by shopkeeper/dealer 5.10% 5.60% 5.40%
Recommendation by friends/relatives/colleagues 4.80% 4.30% 4.50%
The celebrity endorsing the brand 2.50% 2.10% 2.30%
Possibility of buying online 0.80% 0.50% 0.60%
Marketing Whitebook
6. ‘GOING-OUT’ HABITS OF INDIAN YOUTH
• Indian consumers, at least those who
can afford it, are increasingly dining
out, particularly in urban areas.
• Eating out has evolved from an
occasion driven activity to an
occasion in itself. It has become a
form of entertainment for consumers
today.
• Urbanizing double-income
households, changing lifestyles and
food preferences are spurring the
organized market within the dining out
sector.
Casual Dining and QSR Dominates the
Organized Indian Food Service Market
Casual Dining and QSR 70%
Pubs, Bars, Clubs and Lounges 12%
Fine Dining and Frozen Desserts 10%
Cafes 8%
Total Indian Food Service Market 100%
7. FOOD HABITS OF INDIAN YOUTH
31% of Indians are vegetarians for religious and cultural reasons while the rest of the population eat fish and meat
Hindus, the dominant element of the population, strictly abstain from eating beef
Consumption of pork is also limited to a relatively small base
Dining out is popular amongst many Indian consumers, particularly in urban areas, facilitated by busier lifestyles
and higher levels of disposable income. Indeed, value sales at full-service restaurants have increased steadily in
recent years, with consumers largely preferring independent rather than chained venues.
It is also becoming more common for some consumers to order food for takeaway to eat at home during the week
and then to dine out in restaurants
Since a dip in 2009, demand for home delivery/takeaway meals has been increasing steadily, with value sales
reaching nearly Rs2.2 billion in 2013.
Fast food has become highly palatable to the teens and consumers in their early twenties, with international fast
food chains like KFC and McDonalds, Subway, Domino’s Dunkin Donuts particularly popular.
Young consumers consider eating at these places to be fashionable, allowing them to feel a part of the international
youth culture.
The menus in Indian outlets tend to differ from those in other countries with high consumption of beef. There is also
high demand for indigenous meals from independent fast food venues
Many consumers purchase snacks and other food items from the numerous street stalls and kiosks. Street food
like pav bhaji, dosas, pani puri etc are very popular in India.
8. INDIAN FOOD SERVICE MARKET TIMELINE: KEY PLAYERS
• Nirula’s
• Haldiram
Pre-1950
• Honest
Restaurant
• Saravana Bhavan
• Wimpy
1970s and
1980s
• KFC
• McDonald’s
• Pizza Hut
• Domino’s
• Café Coffee Day
1990s
• Subway
• CPK
• Papa John’s
• Jumbo King
• Goli Vada Pav
2000-2010
• Dunkin’ Donuts
• Starbucks
• Taco Bell
• Pizza Express
• Sbarro
2014 - present
Franchisee Model
emerged in mid-
1990s
Red – Global Players
Blue – Indian Players
10. INDIAN FOOD SERVICE MARKET
• Indian food services industry is estimated to be nearly worth USD 41.3 billion and is
growing at a healthy compound annual growth rate (CAGR) of 11%. The Organized
Food Service Industry is worth $13.79 bn (approx. 33% of total Indian Food Service
Industry) and growing at 17%.
• The F&B food service sector in India comprises two distinct market segments:
a) Organised – Chain and licensed standalone players across quick service restaurants, full service
casual and fine dining restaurants, hotels, bars and lounges, cafes and frozen desert formats
b) Unorganised – Dhabas (Roadside restaurants serving as truck stops and serving Indian cuisine),
street stalls, halwai (sweet shops), road side vendors, food carts, etc.
Category
Current
Market
Share
CAGR
Expected Market
Share by 2017
Organized 30% 12-14% 45%
Unorganized 70% 8-10% 55%
11. FOOD SERVICE MARKET SIZE AND CONSTITUENTS
Size of the Licensed Standalone Food Service Market (INR Cr)
Size of the Chain Food Service Market (INR Cr)
4,395 6,240
1,320
33,200
1,640
8,415
Café QSR Frozen
Dessert/Ice
Cream
Casual Dine Fine Dine Pub, Bar,
Club and
Lounge
7,745 10,050
2,330
75,955
2,890
13,550
Café QSR Frozen
Dessert/Ice
Cream
Casual
Dine
Fine Dine Pub, Bar,
Club and
Lounge
2013 2018
1,520
5,500
775
3,950
500 540
Café QSR Frozen
Dessert/Ice
Cream
Casual Dine Fine Dine Pub, Bar,
Club and
Lounge
2013 2018
3,775
16,785
1,560
9,035
1,010 1,085
Café QSR Frozen
Dessert/Ice
Cream
Casual Dine Fine Dine Pub, Bar,
Club and
Lounge
Multiple Sources
12. AVERAGE SPENDS PER PERSON ACROSS FORMATS (Tickets Size)
Unorganized Formats
Avg Ticket
Size (Rs)
The unorganized segment dominates the Indian food service industry. It lacks technical and accounting standardization. It comprises Dhabas
and roadside eateries that have been the most common forms of restaurants and have traditionally addressed eating out requirements of
Indians.
1. Dhabas
2. Roadside Eateries (Street stalls, Hawkers, Trolleys, Standalone sweet shops)
10-100
Organized Formats
Avg Ticket
Size (Rs)
Dining
Fine Dining - A full service restaurant with a specific dedicated meal course. Décor features high quality materials with an eye
towards the “atmosphere” desired by the restaurateur. The staff is usually highly trained. Fine dining restaurant usually targets
rich and upper middle class consumer segments and offers unique ambience and upscale service.
750-3000
Casual Dining - A restaurant serving moderately priced food in a casual atmosphere oriented towards affordable family dining.
Except for buffet style restaurants, these typically provide table service. This addresses the price point between fast food
establishments and fine dining restaurants.
250-750
Bars and
Lounges
Mainly serve alcohol and related beverages. Includes night clubs, sports bars, etc.
Example: F-Bar, Xtreme Sports Bar
500-3000
Quick
Service
Restaurant
s
They emphasize on speed of service, low cost and convenience. Also known as fast food outlets, for practical purposes, they
are essentially characterized by minimal table service and can have a take away and/or home delivery format.
McDonald’s, Nirula’s, Domino’s, Haldiram’s, Subway, Bikanerwalas are some of the leading names in this category.
100-350
Food
Courts
A relatively nascent phenomenon and being popularized by mall developers; also present at other shared spaces (for example
airports, hospitals and office complexes).
100-300
Cafes
Comprises coffee bars and parlours (for example Barista Lavazza, Café Coffee Day) and chai bars. These are casual
restaurants that emphasize on serving beverages and food is incidental.
100-200
Kiosks
A relatively new format which comprises Chinese food, corn, chat kiosks and those from established branded players like Café
Coffee Day or Nirula’s. Also includes ice cream kiosks
100-200
13. MAJOR EXPANSION IN SECOND AND THIRD TIER CITIES
High rental costs and increasing operating costs are impacting the growth of consumer foodservice, and
are set to do so in the future.
Many brands such as Domino’s KFC and Subway opened a high number of outlets in 2012-2013 and will
continue to pursue expansion policies.
Companies are reaching out to second- and third-tier cities as the rents are low and sales are growing.
Off the 749 outlets operated by Domino’s in India, 376 ( roughly 50%) are located in tier – II and tier – II
cities
Rs 5,220
Rs 6,780
Rs 19,260
Rs 2,520
Rs 5,260
$ 18,300
Tier I Cities Tier II & III Cities
Spending Pattern Per Household
2010
2013
2017 E
2010
2013
2018 E
14. DRIVERS OF FOOD SERVICE MARKET IN INDIA
1. Favourable Demographics:
The majority of Indian consumption of fast food is driven by people between
the ages of 18 and 40.
2. Increase in Income and Consumption Levels:
.
3. Lifestyle Changes:
The shift to nuclear families and with both parents working has increased demand for affordable “food
on the go” and prepared ingredients to make cooking faster
4. Rising Number of Working Women:
Increase in working women has increased the spending of their disposable incomes on eating out or
serving ready-to-eat or to pick up prepared foods from QSRs
5. Foreign Direct Investment in India:
100% FDI (January 2012) in single brand retail under the government approval route, i.e., global single
brands in F&B food service can now have full ownership of their Indian businesses
Age Population
<25 50 %
<35 65%
Indian GDP 6 % Disposable Income ↑
Indian Spend on Eating-Out ↑
33,000 Crore Market size
15. CHALLENGES IN INDIA’S FOOD SERVICE MARKET
1. Food price inflation
A key factor affecting the consumer food services market, it is impacted by delayed monsoons, the economic
slowdown, and unfavourable demand-supply conditions. It keeps fluctuating and reached a peak of 18% in 2010.
2. Fragmented Market
The QSR market has many small and mid-size unorganized players competing with large chain players. This
fragmented market reflects a number of challenges, including unclear format segmentation, varied consumer
options for eating out, and the lack of best practices for food services outlets.
3. Real Estate Cost
High real estate cost tend to impact store profitability.
4. Labour Acquisition and Cost
Manpower is a big challenge in the food services market, with an attrition rate of 25-30% and high cost of labour
5. Fragmented Supply Chain and Sourcing
The industry’s supply chain is fragmented in nature and marked by the presence of multiple intermediaries. The
lack of appropriate infrastructure, inadequate technologies, and the non-integration of the food value chain are
factors key to the wastage of nearly 30-40% of prepared food across the supply chain.
6. Red Tapism
In India, obtaining the requisite licenses, e.g. health license, food safety license, police license, No Objection
Certificate (or NOC, from the fire department and the state pollution control board), etc. is a major obstacle
hindering the smooth operation of a restaurant. The process is not centralized as yet and requires filing
applications with individual stakeholders, which involves a lot of paperwork and is a time-consuming activity.
7. Multiple Level of Taxes
The Indian restaurant industry is burdened with multiple taxes like VAT, excise, and service tax, besides different
state taxes
16. ACTIVE PRIVATE EQUITY INTEREST IN INDIAN FOOD SERVICE MARKET
Company Industry Investor Type
Deal Amount
( US$ mn )
Om Pizza - Papa John, Chili's QSR TVS Capital Private Placement 8.3
Adigas Fast Food QSR New Silk Route Private Placement Undisclosed
Moshes Café New Silk Route Private Placement Undisclosed
JSM Corp - HRC, California Pizza Kitchen QSR, Lounge Azim Premji Private Placement 25
Box8 (Ponchos) QSR Indian Angel Network Private Placement Undisclosed
Devyani International Limited QSR India Advantage Fund Series III/ICICI Ventures Private Placement 36.04
Sagar Ratna Hotels Private Limited Hospitality India Equity Partners Fund I Private Placement 25.88
Nirulas Casual Dining/QSR Navis Asia Private Placement 22.5
Speciality Restaurants Fine Dining SAIF Partners Private Placement 22
Cuisine Asia Casual/Fine Dining Verlinvest Private Placement 20
Pind Balluchi Fine Dining Everstone Capital Private Placement 20
Amalgamated Coffee Bean and Trading
Company - CCD
QSR Sequoia Growth 20
Ammi's Biryani Casual Dining SAIF Partners Private Placement 7
Mast Kalendar Casual Dining Helion Venture Private Placement 6
Faasos QSR Sequoia Private Placement 5
Barbeque Nation Casual Dining CX Partners Private Placement 18.3
Beer Café Pub – QSR Mayfield Fund Private Placement Undisclosed
Mani’s Dum Biryani Casual Dining Navlok Ventures Private Placement Undisclosed
Fishtro QSR Correa Hospiyality Private Placement 5
17. WHAT IS A QSR (Quick Service Restaurant)
1. A quick service restaurant (QSR) is characterised by fast food cuisine, minimal table
service and a fixed menu
2. The food (or ingredients) is prepared in bulk in advance and is packaged to order
3. QSRs are usually part of a restaurant chain or a franchise operation, which provisions
standardised ingredients and/or partially prepared foods and supplies them to each
restaurant through controlled channels. It is different from fine dining, as the latter usually
targets rich and upper middle class consumers
4. Fine dining restaurants also offer a unique ambience and upscale service
5. Although fine dining restaurants do not compete directly with QSR, a moderate casual
dining restaurant could be a competitor. It is pertinent to note that while QSRs typically
target customers within the age group of 16-35 years, a casual dining restaurant would
target people across age groups
6. QSRs are able to compete with casual dining restaurants on the basis of factors such as
consistency in quality and speed of delivery.
18. KEY QSRs IN INDIA
44%
23%
15%
10%
6% 2%
Cafes
Pizzas
International Fast Food (Non-Pizzas)
Ice-Creams
Indian Fast Food (Key players)
Confectionaries
2,939
1515
1001
645
419
132
0 500 1,000 1,500 2,000 2,500 3,000 3,500
Cafes
Pizza Chains
International Fast Foods
(Non-Pizzas)
Ice-Creams
Indian Fast Foods
Confectionaries
Outlets of Key Players (Nos. )
19. GROWTH TRENDS IN QSR INDUSTRY
QSRs
Approx. No. of
Outlets
Expansion Plan
Café Coffee Day 1,534
10-15 outlets
every month
Domino’s Pizza 749
140-150 outlets
every year
Barista 180 Not Available
McDonald’s 270
500 outlets in
three years
Pizza Hut 131
250 restaurants
by 2015
US Pizza 81 Not Available
Nirula’s 85 Not Available
KFC 361
500 outlets by
2015
Costa Coffee 100 Not Available
• High speed and consistent food service
and efficiency
• Convenient locations with easy
accessibility from places of work,
commuter routes and shopping areas
• Limited menu choice of standardized
items
• Fast turnaround time through efficient
model of drive-thru and quick order
placement and delivery
• Value proposition for customers due to
low average checks
20. BREAK UP OF MARKET SHARE FOR QSR
Foreign
Brands
Rs 23.4
bn
Indian
Brands
Rs 13.8
bn
Domino's
Rs 4.8 bn
KFC
Rs 2.45 bn
Pizza Hut
Rs 1.8 bn
McDonald's
Rs 2.4 bn
Subway
Rs 3 bn
Others
Rs 9.6 bn
Foreign
Brands
63%
Indian
Brands
37% Domino's
20%
KFC
9%
Pizza Hut
8%
McDonald'
s 11%
Subway
12%
Others
40%
22. VENDING OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET
Reseller Model
Brand, Delivery
Mechanisms
• Public Places
• Entertainment Malls
• Transport
• QSRs, Bakeries
• Exhibitions
• Educational institutes
• Restaurants
• Gyms
• Canteens
• Events
• Road side resorts
Food Services
• 4 Star hotels
• 3 Star hotels
• Service apartments
• Clubs
• Caterers
• FMC’s
• Air lines
• Railways
• Guest houses
• Resorts
Employees / Visitors
• SME’s
• BPO/ IT / ITES / Software/
TEAS
• Banking - BFSI
• Corporate
• Retail
• Manufacturing
• Services – Gyms, Salons, Spas,
Car service centers,
Car showrooms,
Architects, Lawyers,
Doctors, CA’s
23. USE OF TECHNOLOGY IN INDIAN FOOD SERVICE MARKET
• Customer Feedback System
– Dedicated CRM systems are now being favoured and accepted by most restaurants in the
organized sector, thus creating a demand for such providers
• Mobile Application Development
– A fresh trend, largely observed in QSR segment, is the use of mobile apps for order-taking.
– Since the input (address and order) is typed by the customer, chances of error are less.
– As the demand for such apps are increasing, an opportunity with huge potential is observed.
• GPS Enabled Delivery
– GPS is being widely used by restaurants to aid delivery.
• Digital Menu
– Many restaurants now offer digital menu which is directly inked to the kitchen
– This eliminates errors while order taking and also increases tables turnover rate
• Mobile Point of Sale (MPOS)
– These are mobile payment solution using debit/credit cards
– Until recently, cash on delivery was the only mode of payment while delivering food.
– However, plastic money being more prominent now, MPOS presents itself as a huge are for
development.
23
24. MARKET RESEARCH OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET
• Market research is a very important component of business strategy
• It is a key factor to maintain competitiveness over competitors
• Market research provides important information to identify and analyse the market need, market size and
competition
• With more and more players entering the food service space, the demand for market research service
providers are on the rise
24
FOOD DESIGN OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET
• Food Designing
– Focuses on capitalizing upon the visual aspect of culinary art
– Responsible for a lot of visual appetizing that one gets to see at local eateries
– Demand is on the rise since many of the up-scale restaurants like Oh Calcutta, Masala Library, The Table etc
and even some of the budget restaurants like Domino’s Venky’s Chicken require such services.
• Localization
– International restaurants and exotic cuisine makers rely heavily on localization
– McAloo Tikki Burger, Peppy Paneer Pizza, Caviar Jalebi are some of the biggest examples
– Presents a huge opportunity
25. PROCUREMENT OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET
25
Structure Description
Direct Sourcing
Most common among all channels.
The restaurant sources products directly from the processors,
vendor etc
Commissaries
Commissaries directly source food products from suppliers and
deliver ready to eat food to the franchised outlet.
Buying Agency
A Buying Agency is an independent franchise-owned purchasing
cooperative. It negotiates with suppliers on behalf of all its
franchised outlets and aggregates demand
Supply Chain
Partners
SCPs deals with suppliers for fresh products, such as chicken
and vegetables, and delivers ready to eat food products to
restaurants
26. STORE DESIGN, ARCHITECTURE AND CUTLERY SUPPLY
OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET
Store Décor and Architecture:
• Store décor plays a major role on likability of a restaurant
• Chained restaurants require uniform décor across outlets
• Designing the décor and architecture of restaurants is on demand and supply is less
• More restaurants = more opportunities
• Very lucrative in monetary terms
• Huge opportunity for Designers and Architects
26
Cutlery
• With increasing number of restaurants, the demand for suppliers of cutlery is increasing
• Competitive pricing and quality key to success
• Not only restaurants, but vendors and caterers also require the services of such suppliers
• Monogramed cutlery is also on demand
Supplies
• In addition to cutlery, supplies like tissue, soap, sanitizer, towels, napkins, coasters etc. are also required on a regular
basis and are creating high demand
27. DISCOUNT AND COUPON AGGREGATOR WEBSITES
• Indian customers actively seek out discount offers. Makes discount aggregator websites
lucrative opportunities.
• Currently, there are 150 websites which are actively involved in coupon business. On a
conservative estimate, these sites generate a combined 6-7 million page views per month.
• Around 4.6 million Internet users in India aged 15 and older accessed the coupons category
which is 10.4 % of the entire online population.
• Estimated to grow in the next 2-3 years because of the growth in e-commerce purchases.
28. SUPPLY SIDE INGREDIENTS OPPORTUNITIES IN INDIAN FOOD SERVICE
MARKET
• There has been an increasing demand in the Food Service Industry for domestic,
international and exotic ingredients
• However, there are not many such partners,
present on the supply side who can offer:
1. Competitive and Uniform Price
2. Uniform Quality
3. Uniform Quantity
4. Back-end Integration
5. Hygiene Standards
• This has led to a gap in the supply side of ingredients for such restaurants which presents a
huge opportunity with great potential
28
31. MERCHANDISING OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET
• Many restaurants, especially in the QSR space offer patrons (often kids) merchandising
alongside certain purchases. Example include McDonalds’ happy meal offer and Domino’s
Kids meal
• Other restaurants like Hard Rock Café, Café Coffee Day, Starbucks and Gloria Jeans have
dedicated merchandising within stores including
• T-shirts
• Mugs
• Coffee hampers
• Coasters
• Posters
• A lot of these merchandise, especially in the case of McDonald’s happy meal are also used
as promotion material (Eg: Disney movies).
32. PACKAGING OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET
• Indian Packaging Industry is valued at USD 19 Bn in 2014 and it is growing at 12% per
annum
• The food and beverage occupy the largest share of about 85% in packaging industry, a figure
that is estimated to rise
• Sustainability and bio degradable packaging missing
• Light Weighing, easily transportable packaging missing
• Only 600-700 packaging machine manufacturers of which 95% are in small and medium
sectors and located all over the country , so there is huge gap in demand and supply of food
packaging professionals
33. LOGISTICS SECTOR OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET
• Warehousing :
– Majority of operators are small to mid-sized entrepreneurs with limited capacity
– Main players are government agencies like central and state warehousing corporations
– The existing warehouses are of poor quality and are present in limited numbers without adequate
capacity
• Cold Chain Storage :
– About 40% of fruits and vegetables grown in India gets wasted, so the sector needs to grow at
much faster rate to meet the needs
– With the poor electricity condition in the country the cost of operating such facilities is very high
– So it provides an immense opportunity to organized players who can setup the infrastructure and
are able to provide the service through out the nation
34. LOGISTICS SECTOR OPPORTUNITIES IN INDIAN FOOD SERVICE MARKET
Transportation
• Important rail networks are oversaturated, rail fright
tariffs are high, transit time are long and uncertain,
terminal quality is poor, less flexibility in carrying
different types of product
• Road transport faces challenges like poor road
quality with inadequate network coverage , high level
of fragmentation along with majority of unorganized
players in trucking industry, multiple check points
• The current strength of frozen trucks inadequate to
meet demand
• Manufacturers are increasingly outsourcing their
transportation needs
35. D’Essence Hospitality is a Management Consulting, Business Strategy and M&A
Advisory firm based in Mumbai since 1998. We provide our services to QSRs, Casual
Dining, Fine Dining , 4-5 Star Hotels, Clubs, Resorts, Service Apartments, Vending
Solution Providers, Food Service Operators, Back end services providers in Tech etc
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