Indian Food Industry To Touch 5.5 Lakh Crore Mark In 5 Years, Says FICCI-Technopak Report
Following the World Food India, the nation has a food fever running till date. Following the same trend, the Federation of Indian Chambers of Commerce and Industries had released its Technopak report for the trend assessment of Indian food service industry estimates. Here is the brief of what the FICCI has estimated
In India, the food sector has emerged as a high-growth and high-profit sector due to its immense potential for value addition, particularly within the food processing industry. The Food Services sector is expected to have generated direct employment for 5.5-6 million people in the financial year 2016, which is expected to increase to 8.5-9 million by the financial year 2021. Indirect employment has seen a growth in CAGR of four per cent from 2013-2016 and expected to grow six per cent till 2021.
Food Services emerge as a key segment of Indian economy. Indian Food Services market in India (organized and unorganized) is estimated at INR 3,37,500 crore in 2017 and is projected to grow at a CAGR of 10 per cent over the next five years to reach INR 5,52,000 crore by 2022. Two mega metros, Mumbai and Delhi NCR contribute to 22 per cent of the overall Food Services market (11 per cent each) followed by six mini metros (Pune, Ahmedabad, Bengaluru, Chennai, Hyderabad, and Kolkata) comprising of 20 per cent share in the Food Services market. Earlier to this chairman of Technopak Advisors, Arvind Singhal has given the insights of the Indian food service industry during a session at World Food India with title ‘Retail in India base of billions Consumers’. BW Businessworld had given its report on the insights in its story “Indian Retail has Witnessed Transformation to Papad, Pickle & Pizza principal”
A high percentage of the young and working population which is well travelled have double incomes and is experimental along with being tech savvy, is eating out more than their predecessors, driving the growth of the Food Services market. Availability of organized retail space is helping in the consistent growth of Indian and International brands across different formats. The impact of the market as a whole on the entire ecosystem – right from real estate to agriculture, kitchen equipment to supply chain and employment is significant. However, certain challenges such as availability of quality manpower, high attrition rate, high real estate cost, fragmented supply chain, over-licensing etc. act as a headwind for the growth of the industry.
The Indian Food Services market space is attracting significant interests from domestic as well as international private equity and venture capital funds. A large number of investments can be attributed to the fact that the Food Services market is a domestic consumption driven story with great growth potential.
Some key trends are gaining traction in the Food Services space like Virtual Kitchens and Ready to Cook players. Ordering-in has become an integral part of the eating experience and several logistics players are providing last mile delivery for restaurants. Thus, Food Service is emerging as a key contributor for the Indian economy, including employment generation, skill development, growth in the allied industries, entrepreneurship, and tourism and creating experiences for the Indian consumer, says the report.
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