June 23, 2021
The growing trend of aesthetically packaged mithai and namkeen in the organized retail sectors is leading the industry to the major runways
Covid-19 brought immense changes in our lifestyles and one of the significant shifts was seen in the buying patterns of consumers ranging from basic necessities to high-value items like processed food, snacks, packed food items, processed meat, and frozen desserts. This trend has also swamped the mithai and namkeen industry, as a significant spike in the demand for packaged food products has been observed, resulting in an increase in the average purchase value per customer.
As more people were working from home, the definition of basic necessity changed from basic foods to snacking and munching items -This opened an opportunity for the Indian traditional sweets and namkeen industry to enter the organized retail market – aesthetically packed and safe.
Another reason for the rise in demand for packed food has been ensuring safety and hygiene in the times of coronavirus. Although large players in the packaged food industry have been able to smooth down their supply chain issues, the SMEs are still treading the path carefully. The large players have been able to gain shelf-space and market share amid the lockdown, yet the SMEs are not far behind.
People buy packaged items to guarantee safety for themselves and their families. In recent years, packaged sweets have turned out to be an integral part of the packaging process. The traditional popularity of sweets coupled with an increased consumer consciousness of hygiene and cleanliness has made sure that packaged sweets and namkeen have acquired incredible traction.
The organized packaged sweets and namkeens are revolutionizing the packaged food retail industry. With authorities increasingly closing down and tightening norms around food labelling and general safety and hygiene, this is further pushing the need for packaged mithai and namkeen.
Therefore, with a permanently sizeable middle class with increasingly hectic schedules and busy lifestyles, the room for ready-to-serve packaged food can never be enough for the Indian market and there will always be room for growth.
Among many lifestyles change, the Corona-induced lockdown is influencing our snacking habits. As we stay confined in our homes, anxious and anticipating what’s to come next, the ready-to-eat savouries become our instant companions, offering satisfaction as well as a sense of contentment.
Even as the ongoing pandemic has made people more health-conscious, driving them towards healthier snacking options, the unhealthy guilty pleasure snacks have equally been in demand. While snack companies are making more sugar-free and immunity-strengthening alternatives by adding nutritional value to their products, subscription-based healthy snack boxes are on the rise. The packaged sweets and snacks segment quickly recovered and registered impressive performance. However, the unpackaged category including namkeens and Indian sweets have suffered.
The evolution of packaged mithai and namkeen products in the organized retail market
The coronavirus pandemic has made the consumer more mindful of food safety because of which, while buying sweets and namkeen, more people are going to opt for packed products rather than buying them loose from the market. The industry players are foreseeing this as opportunities and hence, many of them will focus on their sweets portfolio this year and plan on continuing their endeavors to expand and grow their product baskets and geographies both.
Dr. Ashok K.Tyagi, Executive Director, Haldiram Snacks Pvt Ltd., said, “As the Indian retail market has matured, the preference of customers for branded, high quality and hygienically manufactured products have only gone up, and sweets and Namkeens are no exception to that”. He added on that because of these brands that represent unmatchable quality and taste have expanded while generic low-quality brands have lost.
Sales of organized mithai and namkeen industry has definitely shot up due to the increasing presence in organized retail and this concept is only going to increase but with the warning that only high-quality players are likely to thrive.
Giving his optimistic view importance of safe packaging, Ashish Agarwal, Director, Bhikharam Chandamal reflected that packaging has made a substantial difference in our sweets & namkeen industries. The products which we never thought will be eatable after 7-8 Days, has just become possible because of suitable packaging. The shelf-life of the product has increased by 3-4 times from the existing time period of 7-8 days. The shelf-life of a product poses a big barrier while distributing the product outside our own retail network.
“I think we have to establish the value of our old tradition in society and prove them we are giving them sweets but with health, put in Vivek Mittal, MD, Bikaner Elite.
The good thing was that the technologically developed in packaging has broken the barrier and now the Indian mithai and namkeen industry can sell their products all over India, from urban cities to villages and at a global level too. Advanced technological packaging especially in sweets has made it possible to sell non-distributable items.
“Though this technology is at nascent stage for sweet products, but if we dwell deeper and things work out in our favour where we can make consumers avail their loved products across all small stores”, Ashish Agarwal said and appended that items such as soan papdi/besan laddoo has already broken all barriers and are sold just like other consumer products in all small & big grocery stores.
In the same lieu, Kunal Bajaj, Director, Punjabi Ghasitaram Halwai, stressed that packaging and presentation of any product should be given a lot of emphasis on and with international packaging technology now being available in India, it is easier to market packaged mithai with a long shelf life, without disturbing any nutrients in the sweets. This gives our industry an edge to offer these products to its customers.
Namkeens as a sector has seen tremendous growth in the last 15 years due to sophisticated high speed packaging machines. Many big food corporations driving the industry’s growth with huge investments, great manufacturing lines that are offering great products to the market.
Packaging of mithai and namkeen is revolutionary as finally the industry getting space to compete with other celebration products like western snacks, chocolates, bakery items, etc. “Now it is up to the manufacturers to upgrade their expertise, skills, capacity, and technology to cater to this demand, elucidated Indraneel Chitale, Partner, Chitale Bandhu Mithaiwale.
The packaged mithais and namkeens are taking the global market by a “Storm”, Srajal Gupta, Madhurima Sweets believes and evaluates that if the product packaging is appealing and has a good display of the product on top, and it will become an easy pickup for the customers.
Talking about market share, PrateekAthwani, Director, Lalsons Sweets, explained that if trends are to be believed then in past 5-7 years ago, there were no MNC in packed ethnic namkeen sector as Indian companies will have created their own niche in it. Giants like ITC and Parle are already in the process of giving stiff competition to western companies.
Food safety and hygiene drive investment in the right kind of packaging
Covid changed the norms of eating habits in India. Consumers have become more conscious about food safety and hygienic food. As modern consumers grow increasingly conscious of purity and hygiene, they are willing to pay the extra buck for products that deliver these qualities. Add this to the current pandemic, and you have even greater concerns over safety and hygiene.
The mithai and namkeen manufacturers are slowly but surely realizing the need for better quality packaging that protects their products from contaminants and ensures protection during transportation via the distribution network. Apart from big companies, even the small retail mithaiwalas with local clientele are considering modern snack packaging machines to ensure the hygiene and shelf-life of their sweet and savoury products.
As the preference of consumers is shifting from the unorganized sector to the organized sector, brand and quality consciousness has shot up tremendously. And accordingly, brands need to focus on ensuring that their packaging authentically reflects the quality of their products. This is all the more applicable to the food sector, where buying decisions are often impulse-based.
“Today, companies have to make sure that in addition to properly showcasing their branding; their packaging is also as consumer-friendly as possible in terms of proper use of ziplocks, easy to remove lids, etc.”, intoned Dr. Tyagi.
People are now more educated and information is readily available just a click away via the internet. Also, consumers can now get information through the nutritional information available on the back of the packed product. The standard of living of people has improved drastically. “Today, the mindset of people is that they want hygiene and best quality of the product rather than looking out just for the quantity in the amount spent by them. Hence it is the right time to invest in the packaging along with investment on research and development both on the products as well as their packaging. Value for money product is looked out for by all”, said Ashish Agarwal.
Stressing that packaging is a valuable asset for industries, Srajal Gupta intuited that this is a critical time of Covid, people have become cleverer before buying a product and spend more on the products on which there is trust, which is only developed product package provides clear picture about it including all necessary information that has to be there on it.
“The fact is that safety and hygiene is no more just an added advantage – it is the need of the hour and the mithai and namkeen industry has to comply with all norms to be in the market. As our economy improves more and the customer becomes knowledgeable, the demand for aesthetically packaged product ranges will go further. This should be taken as a mandatory initiative by all brands” pressed on Indraneel Chitale.
Kunal Bajaj explained that along with quality – taste, price, packaging and now safety & hygiene is most prominent for a consumer making the choice to pick a product. It only is pertinent for the industry to invest in manufacturing lines that offer hygienically packed & safe products, as the consumers are ready to pay that extra value for a premium quality product.
“Yes, especially after a deadly disease like covid-19 in the picture, people are now very particular about hygiene and now it has become a deciding factor in their buying pattern. So better packaging is a must these days to survive in the market and keeping up with the competition and market trends” stated Vivek Mittal.
Consumers are getting more and more conscious of purity and hygiene even if it comes by shelling out few extra bucks hence all should focus on investing more and more towards hygiene practices that still somehow lacks in our industry, evaluated Prateek Athwani.
The right packaging is always product-specific so it’s very important to understand the characteristics of the product before we take a call on packaging. For e.g. technology like retort is being widely and successfully used in enhancing the shelf-life of a product like Rabdi, Gajar halwa etc.
Regulation and norms
With food regulatory authorities have been increasingly raising the bar for quality and hygiene for sweet products, namkeens and other food and snack items, the industry would definitely receive a further boost.
The implementation of tight norms like display ‘best before date’ mandatorily, and the date of manufacturing on non-packaged and loose sweets kept in a container or tray is a more stringent norm than the then existing labelling rules which required these details for pre-packaged/pre-packed sweets only.
Such measures could only further develop the mithai and snack industry. Significantly, prompted by sustainable environmental concerns, the government is also adopting policies to promote recyclable technologies for packaging.
Therefore, as Covid-19 has precipitated an all-out migration to packaged food away from open, loose and perceivably unhygienic food and snack culture, packaged sweets and confectionery category would impart the strongest push to the packaged food industry.
“The tightening norms around food labeling and general safety and hygiene will actually win the confidence of the customer”, said Mittal.
Any packaging requires a higher level of compliance. This helps to comply with regulatory requirements and also ensures capabilities are enhanced to keep delivering the same output. “I see packaging as a right step ahead. What the authorities need to understand is that not every manufacturer needs that market exposure and sometimes the rules that are applicable well for national or distribution players might hamper local players. The regulations need to be flexible to enhance both styles” claimed Chitale.
Agarwal puts in that, it has been always noticed that when things come into the limelight, the governing body comes into the picture and this is a sign that our industry is moving forward very fast. They are like speed breakers on the street which control the speed of the car to avoid accidents. He advised that “Tightening of rules is required to some extent, but it needs to be tightened step by step so that small and medium industries can readily adapt them”.
Tightening the norms by authorities is welcome but a proper guide map and training along with it is very important so that all industries can fulfill them and easily follow them. As already said, people are more knowledgeable so food labeling on products has made packaged sweets more acceptable. The Covid-19 situation has just boosted the demand for packaged products due to its embedded feature of safety and hygiene.
Bajaj in strong favour of tough regulations said, that it is commendable and needs applauding the work of the FSSAI sector, as the authorities have constantly been supportive to the industry in terms of teachings, new laws being implemented and also tightening the norms with new FSSAI rules & regulations. They now offer a very good structure of rules for anyone in the industry to follow.
In the long run, this has been a very important step; the industry will go ahead with FSSAI regulations, the Critical Control Processes are addressed, these will eliminate deviations in processes, and thus reducing the non-compliances. All of these back end checks will lead to a better consumer experience at the front end.
“Also, in the recent times, the government authorities have laid several parameters that each company has to follow, though these parameters are tough but somehow are making our base strong following these practices we also get more educated about our product”, reprimanded Gupta.
Practice such as labelling, date of manufacturing, expiry, nutritional information, etc. not only upgrade the packaging but also develops trust and confidence in customers that lead to increased volume of sales.
Athwani ponders that authorities tightening the norms are one way good for the industry as more and more plant hygiene and personnel hygiene practices will be adopted, which is really needed to take this category to the next level.
Regulatory norms that are reflective of the ground reality of the food industry definitely benefit the consumers and the industry. They help in weeding out low-quality players and encourage innovation as well as an added focus on the promotion of health and hygiene.
“Tighter food labelling norms also help consumers in making more informed choices. However, norms also need to be practical and in line with how traditional snacks and sweets are made” appended Dr.Tyagi.
Western snacks and chocolates versus packaged mithai and namkeen
Western snacks and chocolates, with their innovation, R&D, investments in great manufacturing lines, processes, and packaging machines have mastered the art of increasing shelf-life and providing a good quality product to its consumers, making it accessible across the world.
The Indian packaged mithai and namkeen segment is at the cusp of a new revolution and is bound to have a new trajectory in growth. Today Indian sweet & namkeen manufacturing companies are more efficient, productive, innovative, and competent than ever. With I\the international markets opening up, and consumers being more easily accessible, I believe that the Indian sweets and snack products have huge marketability and demand from its consumers”, asserted Kunal Bajaj. This demand needs to be formally targeted, channelized, meet the customers’ expectations with great packaging and a good quality product to win the heart of the consumers”, he reverberated.
Western snacks and chocolates were the first movers when it came to the branding of snacking products and they have definitely benefitted from that. However, with time, consumers are realizing that sweets and savoury snacks have a very prominent place in the Indian palette, and they can’t be replaced, stated Dr.Tyagi.
Moreover, while traditional snacks have always dominated the unorganized sector, now with the added focus of companies on quality and branding, traditional Indian sweets and snacks are a formidable competitor in the organized space as well and this trend will only get more prominent with time.
Western snacks and chocolates are widely and totally accepted by all as a packaged product with a printed shelf-life. People don’t consider them stale before they expire. But for sweets, it is a mindset that is needed to be eradicated. After a few days, people start considering sweets to be stale and want to buy them fresh over the counter rather than packed sweets.
Obviously, they cannot be at par but once they start finding that the packed sweets almost retain their freshness then acceptance can come in faster.
“No change is easily accepted by all but situations bring them into acceptance, and Covid-19 can be one such boon to this segment because now people are ready to accept standard quality, hygienically prepared sweets with attractive packaging along with the willingness to pay the extra buck for it. The shelf-life of the product alone can be a very big boost to the segment”, pointed out Ashish Agarwal.
We may not be able to grow as much as the chocolate industries as we have the mindset of making things perfect. We can start by making simple things with acceptable quality. It may not turn out to be perfect but we need to keep on developing, making and creating new things as well as keep improvising on the existing ones, appended Agarwal.
Persistence to achieve will bring in growth by itself. India is widely known for its spices and variants in flavours and its food is also gaining popularity the world over. So the pathway is kind of lit for us to enter. Maybe someday we will recapture the market our industry has lost to the chocolate and dry fruit businesses.
Vivek Mittal acknowledges that we have to show the strength of the mithai and namkeen industry globally by using better packaging, attractive designs, catchy advertisements, and most importantly consistency in our products; so that we win the minds of the customers and get them habituated with the products of our industry.
Prateek Athwani added that we have already started giving a tight fight to western snacks and desserts in the domestic market but the same has trend has to be followed across the globe.” I feel all manufacturers should focus on more and more exports to ensure widespread availability of our category all over the world”, he added.
The time is changing the halwais have become big retailers, the trend in packaging of sweets and namkeen is in direct competition with western brands. “Mithai cannot be substituted with chocolates and sale of these have never dipped and has grown in double digits and now again people have started buying sweets and namkeen gift hampers during festivals and ceremonies” said Srajal Gupta.
“We have to think global like they are doing. Right from our procurement, process, packaging, presentation, marketing, distribution and budgets – we need to highlight we are not only as good as them but better when we look at the nutrition aspect” completed Indraneel Chitale.
Epilogue
Indian cuisine has been very delicious and nutritious and our Indian traditional sweets, snacks and namkeens have been loved forever, but with westernization prowling in the nineties and open market brought in a line of top-notch western snacks and chocolates that for sometimes they overshadowed Indian traditional mithais and namkeens for a while. Nonetheless, now the trends of Indian mithai are back in full swing that is also being enjoyed by a lot of people around the world.
With Indian companies expanding their territories and making it easily accessible to the International population, the Indian mithai, snacks, and namkeen industry is bound to see a considerable gain around the globe, due to its taste, popularity, and reach.
It’s a rule that when the scope of the market expands, whether organized or unorganized, the business will also expand. The expansion increases fourfold when it happens in the organized market because the processes and logistics are already in place and just a new product needs to be introduced.
The increase in the shelf-life of the sweets has made it possible for them to be exported to various countries. The new to the day packaging containing self-explanatory information on them makes it easier for other countries to understand and use our products. It also shows the norms fulfilled by the manufacturing and packaging company which makes it easier for the products to go through the approval processes. The technology of cold logistics and cold warehousing add an edge of ease to the whole process.
Indian sweets and namkeen has entered the professional zone and heavy investments are made after checking the feasibility of the products, people across the globe like traditional Indian sweets and namkeen produced in India and the changing lifestyle has increased the urge to buy our products, so the combination of these factors is propelling sweets and namkeen retail sector to a heavy projected annual growth.
The number of brands in the national and international markets has increased also their range of products and this can be clearly seen and felt in the retail and export segment also. This is because of the expansion in the organized retail sector and thus expansion on ethnic sweets and namkeen category, not only in India but across the globe.