Well, with the extreme heat wave and one of the hottest summers ever recorded, people are literally turning to that which offers cold and sweet relishing relief.
The demand for ice cream has literally grown by 30%, and ice-cream manufacturers have received reparation from people for the two dry business years of COVID-19.
Early summer, combined with the withdrawal of COVID-19 cases, made for a good season for ice cream manufacturers, both local and national, as people rushed for the cool dessert to beat the heat.
India’s main ice-cream manufacturer, Amul, has seen its sales triple compared to the last summer of COVID-19. In fact, ice-cream sales this summer have broken all previous records, even as ice cream prices were revised twice this year.
Jayen Mehta, COO, GCMMF (Amul Federation), said: “People are now venturing out without the fear of restrictions and lockdowns, and this has led to a significant upsurge in out-of-home consumption.” In fact, out-of-home consumption is gaining more momentum, and sales in this segment are touching all-time high levels.
Amul’s impulse-category sales are now more than 1 crore pieces per day, and the number is growing further, said Mehta. Vadilal, another homegrown ice-cream manufacturer, has clocked 40% growth in the summer of 2022 as compared to the summer of 2019. “The early onset of summer coupled with an improved demand propelled the sales of ice cream this summer. The demand was also good during the Diwali of 2021,” said Rajesh Gandhi, MD, Vadilal Industries Ltd.
“Industry players who were prepared to leverage the good growth with product innovations have done well in sales. Even though rising prices were a challenge, “the overall sales fared well.”
This year, the demand has increased by 30% compared to the pre-Covid era in 2019. For the past two years, consumers have stayed away from ice cream, “said Bhupat Bhuva, managing director of Amreli-headquartered Sheetal Ice Cream. The company has an annual turnover of Rs 300 crore and has opened more than 30,000 outlets in Gujarat, Maharashtra, Madhya Pradesh, and J & K.
The inflation freeze is being thawed. Even as the demand for ice cream is at an all-time high, inflation pressures remain a key challenge for ice-cream makers. The margins for some have taken a hit as prices of raw materials including milk and milk solids, flavouring agents, and dry fruits have gone up. Before the onset of this summer, Amul had already increased the price of ice cream by 5%.
Consequently, equipment prices have gone up, and consequently, the impact is certainly felt. This is because over the past two years, the industry barely did business and now, when the demand has grown, inflation has gone up, which is impacting the revenues.