In 2005, PC Musthafa along with his 4 cousins started iD Fresh Food as a passion project from Bengaluru. The brand started from a small store selling idly and dosa batter. Today, it is helping put home-made meals on dining tables across Bengaluru, Mysore, Mangalore, Mumbai, Pune, Hyderabad, Vijaywada, Vizag, Rajahmundry, Chennai, Ernakulam, Coimbatore, Cochin, Sharjah, Abu Dhabi, and Dubai.
The brand’s promise of fresh and good food has helped it gain loyal customers and grow exponentially.
Explaining the idea behind starting the brand, PC Musthafa, CEO and Co-founder, iD Fresh Food said, “Back in 2005, we used to get idly dosa batter in a plain pouch with a rubber band on top. This batter had all sorts of quality issues and service complaints. And that’s when we thought of trying to fix the problem ourselves. So, we started from a 50 sq. ft area of the kitchen. It was not an easy job as it took us 9 months to sell 100 packets a day, and it took us 9 months to get 20 customers. But once we had these 20 customers and were selling 100 packets a day that gives us confidence. And that’s how it started.”
At present, the products of the brands are available in around more than 35,000 outlets across 45 cities along with an international presence in countries like UAE, Oman, Saudi Arabia, the US, and the UK. The brand has also partnered with various online players like Big Basket, Swiggy, and Zepto to name a few.
Being an offline-first brand, two-thirds of its revenue still comes from offline channels.
“We sell to retailers directly instead of going through a distributor model. We are betting big on direct retail with the tech as the backbone of execution and it has really worked out well for us,” he emphasized.
Betting Big on Technology
The entire technology at iD is built on SAP as ERP and it has also deployed sales force automation.
“For the distribution of our products, we have geo-tagged each and every store to ensure that whenever we go to the store, our salesperson doesn’t miss out on the store. Then we have done the geo-fencing of the store wherein a person should be able to do transactions within only 15 meters radius of the store to ensure that the salesperson actually reaches to store. We also put it in a cluster to ensure that the salesperson takes the right path, right sequence to cover the stores,” he explained.
“With the help of technology, we have also controlled the wastage of the food and it has helped us in making the business profitable and scalable. So technology plays an extremely important role at iD Fresh Food, in fact, iD runs on IT,” he further added.
The technology helps the brand predict the right demand for the right store on the right day.
For the initial 10 years, the brand did not spend much on marketing instead it focused on placing the right product with the right packaging in the right place. These are the 3 things that it worked upon, and this has proven to be the cheapest and most evitable way of marketing as well.
“If customers are not even aware of the product the one should not even try to do marketing. In the last few years, we started focusing on different aspects of marketing like social media, ATL, BTL, and PR and it is giving us 45 percent year-on-year growth in the last few years,” he asserted.
Matching The Changing Consumer Expectations
Recently, consumer expectations from the brands have changed to a great extent as they are becoming more health conscious. This shift in consumer behavior has further accelerated the sales of the products iD Fresh Food across all platforms.
“All our products are fresh and made with natural ingredients. We do not add any chemicals preservatives or artificial flavors. We make it the same way we used to make it at home. Today, customers have become very health conscious and they love fresh and they love products that are free from preservatives and chemicals. I strongly believe fresh is the future,” he asserted.
Till now, the brand has raised 3 rounds of funds. The first round of funding was led by Helion Ventures in 2014, Premji Invest came on board in 2016-17 and then this year in January the brand raised Series D funding worth Rs 507 crore from NewQuest Capital Partner and Helion exited.
“We are a profitable business and we work on a zero cash spend model as well as zero working capital as well because everything is fresh. The only reason we need money at present is to expand to new places and to set up a new factory. Of course, depending on our growth plans, we would be looking at further funds but as of today we are doing well,” he explained.
The brand, which has been growing 40-45 percent year-on-year, is planning to come up with its IPO in the next 2-3 years.
At present, the brand has a strong presence in Tier I and metro cities. It is also even setting up its plant in Delhi, and Kolkata, and also looking at expansion in Singapore, and Saudi Arabia. It will also be expanding in GCC countries like Kuwait and Qatar.
“We have very less penetration in Tier II cities and beyond because our product usually does well with the double-income family. So we are pretty strong in tier I cities and to some extent in tier II cities,” he said.
At present, the brand has manufacturing units in Bengaluru, Hyderabad, Mumbai, and Dubai and planning to set up new units in Saudi, UK, and US.
Along with this, the brand is betting big on the dairy category and is aiming for Rs 100 crore in revenue from dairy.