With the busy lifestyles of the millennial workforce, the increase in gross family income, and with nuclear families and work-from-home becoming the norm, consumers seeking convenient food options, the ready-to-eat (RTE) and ready-to-cook (RTC) categories have been seeing a lot of action. The mounting inclination towards convenience food in the working population is being directed by the particularly grueling work-from-home schedules in the last two years, increasing disposable income in the hands of the middle-class strata, the myriad of new product launches, and the intensifying reach of retail markets. So, how bright is the future of the Ready-to-Cook and Ready-to-Eat segment in India given this scenario?
Broadly, this market cleaves into two segments - frozen and shelf-stable categories. According to Technavio’s latest market segmentation analysis, we can expect this category to grow in India by $751.43 mn from 2021 to 2026 with the growth momentum of the market accelerating at a CAGR of 18.63 percent during this period.
Furthermore, the frozen food division will make significant strides and add a whole gamut such as meat and poultry, snacks, ready meals, vegetables, and fruits to their offerings. It is important to remember though that the frozen category is a tough one, given the numerous dynamics at stake, such as the requirement of temperature-controlled environments from the production time to reaching the consumers’ plate.
The Current Demand
The demand for RTE food products skyrocketed during the COVID-19 pandemic, and the industry became one of the few to witness a surge in demand during the pandemic. With countries in lockdown and most people working from home, RTC products were flying off the shelves over the last few months. No wonder then that the RTE market is also projected to register a CAGR of 4.3 percent during 2021-2026 globally.
What we see now, is a budding demand for quick food that’s also high in nutritional value, and the most popular RTE products in India include preparations of paneer, chana masala, rajma masala, pav bhaji, etc.
Future of This Market in India
For one thing, this category commands constant innovation and additions at planned intervals and studies are highlighting how the right size pack containing niche, regional options of Ready-to-Eat meals, and flavors are more likely to find favor with the contemporary Indian consumers of the future. For example, small, single-use packs of upma are great at targeting the young, entry-level office, or college-going consumer while medium packs of various kinds of masala, parathas, fries, etc. are what compact, nuclear families are more likely to purchase, with the sliding price range of the different size packs becoming a key sale determiner.
Other than the growing requirement for a variety of product offerings and pack sizes, sustainable packaging is also another prominent need of the hour. With all these additional, dynamic parameters, companies still have to be able to maintain the economies of price per pack as well.
The Indian consumer is evolving as is their demand for more niche regional flavored, Ready-to-Eat meals that are packed in a clean, green manner. If all these factors can be fulfilled by the industry, we should be prepared to witness a huge, growing demand potential.