Indian FoodService Industry to Reach Rs 5,52,000 crore by 2022 With a 10% Growth
AdAge India , Dec 13, 2018
Industry leaders of the Indian Food Service Retail sector highlighted the upcoming golden decade of the growth in the industry driven by the changing consumer behaviors and influx of technologies within the business. During the event, ‘FICCI – PwC report on ‘Changing Landscape of the Food Service Retail Industry’ was also released.
As per PwC, the overall food industry has grown by 10 per cent. Organized and unorganized players together are valued at INR 4.50 thousand crores, 25 – 30 percent of which is contributed by organized segment. Unnat Varma, Chairman, FICCI Task Force on Food Service Retail and MD, Pizza Hut India Sub Continent added that true transformations are happening with use of technology; expectation from food eco-system is changing and food that is at heart of all services is being outsourced thus paving a way for double digit growth.
According to this report, Ethnic cuisine will increasingly be present in organised and hygienic set-ups. Food tech will continue to “Organize the Unorganized”– driving increased focus on consumers, food innovation and efficiency Restaurants will increasingly focus on consumer engagement using technology.
Social media will continue to transform relationships with consumers. Health and wellness will continue to ride high on consumer preferences. Traditional packaging will make way for innovative food packaging.
- In 2022, the Indian food service industry is forecast to have a volume of 77 billion transactions, an increase of 28.5% since 2017. The CAGR of the industry in the period 2017–22 is predicted to be 5.1%.
- The performance of the foodService industry is forecast to accelerate, with an anticipated CAGR of 10% for the five-year period 2017–2022. This is expected to drive the industry to a value of INR 5,52,000 crore by the end of 2022.
- Evolution of food is happening, thanks to the innovation in traditional menus. Fusion food is attracting the experimental consumer. Foreign players are adapting to the local palate, whereas locals are introducing foreign flavors in their food.
- Internet penetration and smartphone usage to increase the demand for specialized food and gourmet.
- Technology is disrupting the market with the advent of web-based ordering and use of AI and IoT in ordering. These developments are set to revolutionize home delivery with faster availability of food at home or office.
Speaking at FICCI’s Foodzania 2018 – The Food Service Retail Conference on the theme of ‘Changing Landscape of the Food Service Retail Industry’, Varma said that the Indian food service industry is at the cusp of a massive growth. He further added that the changing landscape of the food service retail industry is largely driven by the changing consumer behaviour which can lead the sector for a sustained double digit growth over a decade. “There is a huge consumer market, changing consumer habits, increase in disposable income, and as the industry has evolved, it has become bigger and better,” said Varma.
Jagbir Singh Sidhu, Chief Operating Officer (North), Diageo India said that the food services industry contributes significantly to the economy by creating millions of jobs. “With the advent of newer technology, the industry has seen a paradigm shift with consumers opting for ‘dining out’ experiences, making it an important partner for the beverage alcohol sector,” he added.
Rahul Singh, President, NRAI and Founder & CEO, The Beer Café highlighted the significant role of food aggregators in increasing the consumption of outside food. He said that they are the creators of behavioral change among consumers that is going to increase propensity of dining out. “Next 10 years are going to be the golden decade from the perspective of consumption,” he added.
Pravesh Sharma, IAS (Retd.), Former MD, Small Farmers Agri-Business Consortium (SFAC), Department of Agriculture, Cooperation and Farmers Welfare, ministry of Agriculture and Framers Welfare said that today the agriculture sector is more market driven, “For at least a decade-and-a-half, all the major trends in agriculture sector were signaled and driven by the market,” he said.