Indian Bakery Industry to Bake Puffy Profits

Posted in Baked Goods by Adolf on Jun 27,2014 13

Indian Bakery Sector delivers crisp profits

Generally the eatables industry is doing brisk business all over the globe and it is of no surprise. The global bakery industry is of no exception as it is baking fresh profits now and is expected to be the same in the years coming up. Today the industry might be full of advanced technologies making the production process simple but this surely wasn’t the case when it all started. Baking, the art started in the Roman Empire, the Romans just loved to consume baked products and they hiked in demand during auspicious occasions such as weddings and feasts. With the demand increasing during the 300BC period, baking turned into a professional art thus bakery stores were set-up. With the expansion of bakery shops, the demand went up drastically and the activity of selling different baked products across the globe caught speed.

Indian Bakery Industry

India is one of the leading markets for bakery products; there is a total volume of 3 million tons of bakery products. Out of this massive production, 1.3 million tons fall under the organized sector and the remaining amount cover the unorganized small-scale industries that produce these products locally. The Indian bakery industry basically can be segregated into three segments- breads, biscuits and cakes. Initially, the bakery industry in India was concentrated to cater to people from the lower or the middle class, but today the segment is wide spread and selling products to people from all fronts as there is a vast change in their lifestyles and consumption patterns.

Bakery products; worldwide considered as the cost-efficient intake and thus the consumption level is robust, this mindset is the same with the consumers of India and thus there are increased number of bakery products producers. Though there are some technological developments that have introduced the automatic and semi-automatic production methods, maximum consumers of these products prefer the traditional method of making these bakery products. The industry on one hand is ruled by the traditional bakeries that manufacture and sell products on a routine basis. The industry has also witnessed the intruders from the west that is the MNC’s multination’s bringing in varieties like pizzas, burgers and more. This has proven to increase choices for consumers and of course placed the competition to a higher, tougher level.

Large investors like Pizza Hut, Dominos and Mc. Donald’s are the front line competitors for the traditional bakery stores. Moreover, the big volume ventures like Britannia, Morish and Briskfarm along with the introduction of bakery cafes such as Café Coffee Day, Costa Café and Barista are converting the industry a tough place to survive. Although the race is tight, the unorganized industry filled in for about 1.5 million tons of total biscuit production in the country accounting to a 85% and 90% of other bakery products that is valued at around 0.6 million tons. These other bakery products include eatables such as cakes, buns, rusks and pastries. The Indian bakery packed product segment is estimated at a whopping 17,000 crores with an expectation of 15% annual growth for the next 5 years. Talking of the biscuit segment, it is ruled by two to three main players like Parle Agro, Britannia, ITC and Cadbury’s making up the major share of more than 75% of the market. The biscuits and breads section of the industry has seen introduction of some international brands like United Biscuits and Unibic which have proved to be serious contenders in the industry within a short span of the existence.

Going by the market research reports from the industry, the Indian bakery sector is soon to encounter some harsh rivalry from popular international brands in the upcoming years. The business composition of the industry is expected to be ruled by the biscuit segment which shows growth estimate of 15% growth as compared to the bread section. The revenue level is predicted to reach the mark of $ 7.6 billion by the end of 2015 whereas it was recorded to be $ 4.7 billion in 2010.

The future for the industry seems to be tougher for the manufactures with solid potentials of profits in case of success. For the consumers, this is an industry where they can pick-n-choose and enjoy the experience as they have loads of products in the market. The demand in the bakery products are increasing as demands for branded products is rising, the income levels are also creeping up and awareness of health benefits of consuming premium quality bakery products is fast spreading.

Moreover, the makers in the industry are introducing small packs which bring in the affordability factor. This is seen as an excellent effort just to win the sales chat. This on the other hand is proving as a blessing for consumers as they can have the best quality products at best possible pricing.

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