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Unlocking the Sweet Industry

Indian Sweet Industry is still largely untapped

Tags: FMCG, Chocolates, unskilled labour, FMCG

BY Indian Retailer Bureau  |  comments ( 7 )  | 
Unlocking the Sweet Industry

In complementing with the sweet toothed Indian’s taste buds, sweet marts and mithai shops are offering a myriad of delectable mithais that instantly release an opus of yummilicious   flavours as they melt in the mouth. Opportunely, Mithai business is thriving like never before.

 

As the Indian market gears up to meet the demand of the festive season that will start with Durga Pooja/Navratari, we embarked on a journey to know how has the industry transformed in recent years and what is its potential in both domestic and the international market…

 

Mithai vs Chocolates

One may wonder why Mithai shops are conspicuous by their absence in malls, and if they are being dwarfed by chocolate stores that are entering the market in a grand way? 

 

After studying the trend of the last few years, we opine, “The answer lies in special marketing devises to take over sweet market in festivals with unique advertisements, marketing and packaging strategies, applied by FMCG companies resulting in a major chunk of the sweet eaters switching over to chocolates; other reason being short shelf life of the sweets”.

 

But Rahul Chaurasia of Ganguram, Kolkata is not amused at all and refuses to buy the story. “Sweets hold their own charm”, so he justifies.

 

Even Anil Gupta of Nathus Sweets is undeterred. “People who have developed a taste for old age mithai will not compromise on their taste”, he reiterates confidently.

 

But Nirmal Jain of Ghantewala agrees that there is some truth in it.”There are lots of substitutes available like biscuits, chocolates etc. Although, these don’t make mithai any less important yet the sale does get affected. Say, earlier people who bought 1 kg of Sohan halwa may now go for 1/2 kg  of mithai  shared with, say, a big box of chocolates”, she comes with a ready exemplar.

 

The Mithai basket

Milk items like Rasagullas, Gulab Jamuns are a rage everywhere and even white Caucasians in Europe have succumbed to the irresistible Bengali sweets. Thanks to the innovative packaging, now they are walking the export route. Petha is another item of export.

 

Ruling the roost in domestic market are also Khoya items like Barfi, made with Almond, Pistachio and Cashew, the last one called Kaju katli.

 

“We are a joint family business, and have 10 outlets presently. And apart from swearing by the above,  we live by seasonal sweets like Ghewar in Teej, Gujjias in Holi and so on”, informs Anil.

 

The city of joy, Kolkata, is incidentally also the originator of famous Bengali sweets which are famous worldwide. “Our hot selling items are Misti Doi and Sandesh apart from all time favourite fresh Rasagullas. Furthermore, the demand for sweets is consistent all throughout the year and increases in festivals like Dashmi, Diwali and Vishwakarma puja  where corporate purchase is at its peak”, informs Rahul.

 

And if you are searching for pure desi ghee items, then Ghantewala famous for Sohan halwa and Barfi in Chandni chowk, New Delhi, is the answer.

 

Low market of sugar free Mithais

In keeping with the health theory, sugar free sweets are being offered by all major shops.

 

Ganguram purports sale of Kaju Barfi and Kalakand in Kolkata. “People have misconception that sugar free mithais are tasteless and this awareness has to reach the diabetics and health conscious people so that they could fully explore the market”, he explains why they are still not popular.

 

Suryakant Tiwari of Tiwari Sweets, Mumbai agree that due to lack of awareness and its short shelf life, the daily production of sugar free mithai is hardly 2-3 kgs in each shop. Even Anil agrees with him.

 

 

Target customers and packaging

Due to increasing prices of raw materials and use of high quality, pure products, and appending further the other retail costs, all add to high pricing and can only suit the pockets of middle class and upper middle class.

 

“Kolkatans don’t like to pay for packaging, they prefer it to come free”, Rahul avers when asked if he uses any special type of packaging for his products.

 

Suryakant’s take on packaging is no different, “We are far far behind in packaging because our customers come to us looking for quality barring exceptions in terms of special requests and during festivals”. He stresses that packaging has little role to play in their business.

 

Export potential

India is a land of religious people and the turn of festivals gives impetus to sales.

 

Besides, there is a lot of potential in this sector as demand is increasing in India and European countries. But except for a few, most don’t export directly.

 

When asked why Nathu is shying to tread on the export route, Anil Gupta was quick to answer, “We want to first meet up the local demand and then think of exports, which is still a thought too thin in our minds”.

 

Likewise, Rahul too agrees that Bengali Sweets are gaining momentum in America and Europe, and in keeping with the demand they do export but not directly.

 

Suryakant’s idea on exports is no different. “We send if there are big orders of say 10 kgs onwards but they can’t be called direct exports”.

 

According to S S Agarwal, promoter of Bikanervala, 20 per cent of the company’s local production of branded sweets is now being exported. And we are growing at the rate of 5-6 percent every year.

 

Sachin Anand who looks after exports of the same organisation informs that their competitors are Bikaji and Haldiram. ‘Of course, the quantum of export increases during festivals like Diwali etc.‘, he asserts while advising those desiring to foray into exports to stay punctual to be successful.

 

“We have lot of customers from Dubai for our Sohan halwa who carry loads from the shop but there is no direct export in strict sense”, Nirmal Jain informs.

 

Advice to new entrants

Almost all agree that the market still has a lot of potential.

 

Rahul informs,” Kolkata market is saturated, but yes, if one has good investment reservoir and he can offer quality sweets, then there is space for him”.

 

According to Anil Gupta and Suryakant, “People with hygiene and quality consciousness are most welcome”.

 

 

Tackling adulteration/ quality control

The problem of adulteration has to be tackled. Section 104, 57 and 58 of the Agricultural Produce Marketing Board Act empowers the Committee to seize or/and slap penalty of around Rs 5,000 on those selling khoya or mawa in the open market other than the mandi.

 

For authenticity of Khoya, a lab test would be more apt rather than the manual test most are doing.

 

Increased spending on R&D for better quality monitoring, use of state-of-the-art preservation and aseptic as well as data of potential markets have to further come together to tap the full potential for future growth.

 

Conclusion:

The market for traditional Indian milk-based sweets alone is estimated at $500m. A major push in this direction of turning out bigger volumes of strictly quality controlled traditional sweets for commercial sales both domestically and abroad is needed. Entrepreneurs in Europe, North America and Australia are looking into the prospects of manufacturing traditional Indian sweets. Hopefully, the coming years will witness taste of Indian sweets spreading far and wide.





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Pradip Bhowmick June 06, 2016 at 12:19 pm

Sir, I want to open a sweet retail in Naihati Anandabazar. I have my own shop of 130 sq ft. Please contact in my mobile number 9830357101. Contact ASAP.

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Franchise Required April 29, 2014 at 3:10 pm

sir,i am interesed in opening a sweet shop.i would like to take ur franchise near chinar park area,kolkata.please help me out.I have shifted to this area few days back nd finding good demand for the sweets as the area is goin to be vey much populated within few years.

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Mojibur Rahman August 19, 2012 at 9:07 am

sir,\r\nI have shop in Baily Road, Dhaka , Bangladesh. The area is very famous for varieties of food business. I am interested to marketing Indian sweet, which has a very good potential. So pl help me I how I initiate the the business with you.

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Karan October 17, 2010 at 2:18 pm

I have a site near Golden Temple(50-100meters away) and I am Interested in your outlets. could you pls tell me in details for that

Reply |

Karan October 17, 2010 at 2:15 pm

I would Like to take Franchise. Could You Tell Me In Details About The Business Contact member@franchiseindia.com

Reply |

Regent Electronics October 16, 2010 at 12:04 am

looking for a franchisee in kamla nagar,delhi-7 contact member@franchiseindia.com

Reply |

RAHUL GUPTA October 09, 2010 at 9:29 am

sir , i am interested to open outlet of your group , we have a available a site on national highway NH - 1 in your city , situated in karnal ( HARYANA ) . At present we are running petrol pump , and have building's & showroom on rent to many companies . Now we want to expand our business more . please send us the executive who could introduce this company more in detail's

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