How profitable & sustainable is the juicing business? Standing at over Rs 1,200 crore today, it is one of the most promising and profitable businesses, believes advisory firm, Technopak. The fresh fruit juice market is reaping juicy returns as it has beco
The fruit juice market is one of the fastest growing categories in the beverages segment, growing at a CAGR of over 25-30 per cent over the past decade. The growing trend of fitness and keeping oneself healthy is driving the juice business in India ahead with opening of juice bars and cafes in the major metro cities like Mumbai, Delhi, Bengaluru, Hyderabad, Pune and Chennai. This sector primarily dominated by the unorganised players or the local vendors is cashing in on the rising demand.
With global players like the Australia-based 'Boost Juice' entering India, which was renamed as 'Joost Juice Bars' since there was already a milk beverage by the same name, the concept of having a juice bar or cafe is certainly defining the new-age healthy, refreshing business models.
Sowing seeds of Juice biz in India
Rivoli Sinha, a hotel school graduate from Les- Roches Switzerland and a food lover too, had always dreamt of doing something of her own in the food segment. Having worked with global chains like Marriott, her experience came handy when she brought 'Joost Juice Bars' to India in 2011.
It was during her family visit to Australia back in August 2008 that she came across the first Boost juice parlours and found it an interesting opportunity for the country like India, where she could foresee the need of a healthy beverage segment serving to a growing health-conscious customer base.
Currently, Joost Juice Bars has over eight outlets in Delhi-NCR and another four in the pipeline; three in Delhi and one at Mumbai airport. With locations such as airports, gyms, malls and hospitals, the brand has really played well in terms of growth and revenue. Operating as a Master Franchisee of the Australian brand, the group has worked out the quality with “Think Global Eat Local” attitude by adopting only 40 per cent of the global products in its menu, while tweaking 60 per cent of it, in a bid to suit the preferences and tastes of the Indian customer.
With backend, supply chain and quality all in place, Joost is now looking to redefine the juice market by expanding its operation to Mumbai and other West-Indian markets. Rivoli is ecstatic about the juice business and is now looking to extend her business 'family' in the country.
“Joost is standing strong in its fourth year and with nine stores, I am entering Mumbai with the first store at the Mumbai airport. We want to enter the West starting from Mumbai and Pune operations this year and we are also welcoming franchisees,” Rivoli shares.
A fresh glass of opportunity!
Hailing from a family of entrepreneurs and Asia Pacific's largest security giant, Security and Intelligence Services India Ltd. (SIS), Rivoli has grown up seeing her father building a company from scratch, working on every aspect of quality. And it was only during the Chubb acquisition, the Australian security company SIS acquired in $235 million, while the family was in Australia and liked everything served at the Boost juice bar. It was then that they thought of bringing the brand to India.
“We are into many other businesses apart from SIS Security. And 'Juicing' is a very interesting concept, since smoothies, crushes and juices are still very new to the country and nothing healthy has been coming to our country in the QSR model. Everything is on the same line of frying and junk food; quick service has almost been equal to unhealthy and so, to bridge this gap we brought a more health centric concept to India,” remembers Rivoli. As the nature of the business is perishable, Rivoli has worked a lot in delivering the best quality juice to her customers by adopting technologies like Individual Quick Freezing (IQF) and partnering with Future Logistics to deliver a product in its best shape and taste. And needless to say, it has worked wonders for both quality-conscious customers and the company.
Think global ‘drink’ local
Being the Master Franchisee for the Boost Juice in India, the group has worked on everything with a global attitude. Sourcing the best raw materials and fruits from the best of markets, the brand has carefully segregated the areas where to source it, be it from India or the global markets.
In addition, Joost has chosen IQF technology to maintain the freshness and quality of a fruit that is either not available in India, or has a seasonal issue without making it a frozen food.
In the early days, Rivoli herself used to visit local mandis like Azadpur to get the best quality fruits. But now, with a considerable experience and expertise in picking the best quality fruits, the brand has segregated the fruit varieties as per the month they are available in.
They source blueberries and raspberries from New Zealand; Sweet Charlie, a more appropriate Strawberry, from Mahableshwar-Panchgani belt; Mangoes from Ratnagiri and Apples from Kashmir.
With customisation of more than 60 per cent of its menu, the group has introduced drinks like figalicious, fruit punch and even changed the core product of 'Boost' Mango magic to Mega Mango Magic making it more suitable for Indian taste. “I am not compromising on anything because I know this is going to get bigger and we don't want to risk the quality,” points confident Rivoli.
Joost to boost its presence
With nine stores and do-it-all attitude of the Master Franchisee, the brand is all set to tap the West, which will start from Mumbai and Pune operations in the current year. For spreading its reach to untapped geographies and extending its business arm, the company is seeking franchisees. So far, Joost Juice Bars has all company-owned stores.
“I thought it was very important to not only just grant license to franchisees, but also give a back-end support to help them know your business well and raise to higher level,” believes Rivoli. Since investment is an important aspect for any company to grow, Joost is also open to get investments. So, Joost will be seen in many more malls, hospitals and gyms.
“This business is attractive to the potential entrepreneurs and investors as it is profitable. If it were not profitable, I would not have been sitting here,” shares Rivoli. According to the exhaustive research led by advisory firm, Technopak before Australia's Boost was brought down to Indian soil, and the math of the business indicated it to be among the top future businesses in India.
Amazingly, the numbers Technopak calculated crossed on the very first day of the opening. With stores selling at around 500 glasses per day at each of its outlets and collecting over Rs 80, 0000 as profit per day, the business is here to stay for a long time.
Challenges in the business
The juice segment faces the major challenge from the unorganised players of the juice business sector. The taxes, too, have been increased on imports with the introduction of a new stringent law stating that products to be imported from Australia could be torn and opened before landing in India, posing a challenge to the business fraternity. Even the group has to take the challenge to get the things to the kitchen and that is something Rivoli cannot risk on.
“The increase in taxes on imports has restricted us to use newer exotic fruits that we can only source from global markets,” comments Rivoli.
While the juice industry has still been dominated majorly by the unorganised players, it is a pure opportunity waiting to get tapped vis-a-vis investments and business opportunities. We can say that with the increasing number of people imbibing a healthy lifestyle, the Indian juice market is paying rich dividends to both the new as well as existing players in the market.