An interview with Arjun Gadkari, Nilgai Foods
Arjun Gadkari, President, Nilgai Foods says there are a lot of opportunities prevail in Indian Rs 6, 000 crore gourmet food industry.
What were the ideas that led to you bring Nilgai Foods into being?
We were excited by the macro trends that we were observing in India around the changes in spending and eating habits across India. Discretionary spending was on the rise, and thanks to greater exposure to international habits and culture, the industries linked to foreign cuisines (food imports, international restaurants etc) were rapidly expanding. This created a perfect backdrop for some of the business ideas that Abhay and I had been discussing back in London - by the summer of 2010 we were set on relocating to India to get into the food space and take part in this new growth story. Our backgrounds allowed us to focus on the gourmet end of the market - a sector that happened to be growing the fastest because of the relatively recent arrival of a gourmet food scene in India. The original ideas that led us to India revolved around making gourmet food more accessible to the Indian consumer.
What kind of preparation you took to foray in this niche segment?
Our first step was to set up a small and relatively discreet cafe space where we could test our product ideas and experiment liberally without attracting too much attention. We chose to open at Le Mill, a lifestyle store in South Mumbai. That allowed us to build a team and lay the foundations for what was to come, but at the same time it allowed for extensive product development that could be tried and tested against the crowd that came to the cafe. It took us more than two years of research and development to reach where we are today, with a range of almost 20 SKUs that are fully compliant and shelf life tested, which are available across a few cities in retail shops.
What is the USP of Indian gourmet food segment?
Pico's USP lies in the synergies that we are finding between our gourmet QSR vertical and our food processing one. Rarely in India have the two verticals come together under the same roof, and so the knowledge sharing between the two divisions has allowed us to differentiate ourselves: the process driven qualities of manufacturing have given the QSR side strictly followed SOPs and processes, while the highly experienced chef team from the fresh foods side has given profound insight to the R&D linked to the manufacturing arm of the company. Where the USP of the gourmet segment as a whole is concerned, my personal opinion is that the segment is too young to draw out any valuable observations. The gourmet segment is still heavily dominated by imported products, a sign of how far the industry needs to develop domestically. Aside from imports, more recently organic foods and 'health' foods have made an appearance, and while the growth is promising these categories are not without problems of their own.
What needs to be done to make it better and comprehensive?
There are softer changes that can happen such as more innovation in terms of packaging design and the aesthetics of the overall products. Beyond that, as the supply chain improves so will the quality and consistency of the ingredients. Recently there has been an increase in the number of modern retailers that stock gourmet foods - as the availability improves across the country, so will the consumer's awareness and understanding of the gourmet segment as a whole.
To maintain high standard hygiene and quality, what are the strategies you adopt?
As a company we are meticulous when it comes to hygiene, safety and quality. We believe that our products are at an international standard and careful controls help to ensure that there is consistency to the standards that we set. Our team includes food technologists who are able to monitor the products as they are being made and carry out tests continually after a batch has entered the market. Although we do not yet have any international safety certifications, we are trying to follow the guidelines even today so that compliance becomes easier as soon as we are ready.
What is the concept of Pico Express bringing food-on-the-go concept?
Pico Express brings an international F&B format to India, a new concept here although as a format it is readily available in other countries. The idea is to provide fresh (everything is made on the same day that it is consumed) pre-packaged food to the customer in as mess free a way as possible. Packaged salads, sandwiches, dessert and main dishes are displayed on chilled shelves within reach of the customer. The customer chooses a product and takes it off the shelf by himself / herself. At this point the food can either be eaten at one of the tables in the cafe itself or else the food can be given for takeaway - the packaging is such that it is completely mess free and ready to go regardless of where you will eat. The menu is made up of global flavours - anything from the Caribbean to Burma or the Middle East. There are also a few Indian dishes such as biryani for someone who is looking for comfort. The idea is to provide accessible, readily available food in corporate areas around the city, targeting people who often don't have time to sit down for a full meal during lunch.
What are your future plans?
We plan to expand across Mumbai and we are considering entering other cities such as Delhi and Bangalore. We are still at least one year away from expanding beyond Mumbai. For the retail products, our distribution channels brings our products to Mumbai, Delhi, Pune and a few other satellite towns around these cities. We plan to expand nationally and eventually overseas through export.
What is the market size of gourmet food in India? Who are the dominant names?
The market size of gourmet food in India is about Rs 6, 000 crore. A few of the gourmet players include 24 Lettered Mantra, Buira and Dr Oatker's.
In what percent the market is growing?
The gourmet segment is growing faster than the overall food industry at approximately 29 percent.