The Phenomenal Evolution Of Food Industry In Maharashtra
By Ashwin Bhadri, CEO, Equinox Labs
A person who happens to stay in different parts of India but given a considerable amount of his time to Maharashtra, would definitely comment on the variety of food that is available and relish it for life. Such is the impact of cuisines available in the state. No one would ever deny the fact of the super enthusiastic food vendors that are stationed outside famous colleges, streets, stations, corporate offices in the state. These are iconic, and by that we mean that these are synonymous with the state and its culture. By now everyone would have been accustomed to the staple eatables like the spicy vada pav, thalipeeth, poha, upma and the Kolhapuri misal.
History, has however, given the state a diverse set of castes, beliefs and religions. This has brought with it cuisines that several generations have tried, tasted and loved so much that even centuries later, the cravings haven’t died down. What began as a home-made food, slowly grew into food businesses and startups we now see under brand names and in plush hotels.
Why Maharashtra amongst all the States?
Maharashtra is the second largest state in India and is divided into three major regions - Vidarbha, Marathwada & Konkan. The flourishing of the food industries in all the three areas in the 18th and 19th century has been distinctive enough because of reasons such as conducive weather, government support and productive operational methods. Maharashtra being an agrarian state, it has about 16,512 small and medium and 322 large scale food processing units. Fruits, cereals and grains - you name the raw material and Maharashtra holds its head high up with pride on the availability. It is not just anyways that the state has the highest GDP in India.
While we talk about the land, we should not forget the coast and the waterways that has contributed immensely in the solid growth of food businesses. 22 percent of the total country’s transport occurs in Maharashtra. Import - Export and Fishing has been the soul of the Konkan region from a long time. A total of 13 percent share is held by the state in the country’s total exports. Fishing has been pivotal to not just food startups, but has been the livestock for many people since decades. In the last fiscal year itself, the growth has been 25 percent from the previous 17 percent.
The state has one more important factor to contribute - Real Estate. Blessed with a vast, fertile land, Maharashtra hosts numerous types of industrial facilities that are not possible in many states. This reduces logistics cost, facilitates quick farm to fork transport, thereby reducing the loss of food during transit. This was further accelerated by Make in India concept, under which Make in Maharashtra has gained popularity. Policies, finances, government support, loan waiving to financially weak businesses, subsidiaries, incentives, schemes and such facilities have given a boost and encouragement to many.
After a devastating confusion and poor state of affairs due to 8 different laws, in 2006, Food Safety and Standards Act that was conceptualised. In 2008, Food Safety and Standards Authority of India (FSSAI), the apex body monitoring and governing the safety of Food Industry, came into existence.
While agriculture was growing steadily enough, a comparative growth was also witnessed in the fishing, animal husbandry & wine manufacturing sectors. Restaurants, street vendors, small scale shops, retail shops and home-cooked food stalls were stationed across the major cities like Mumbai & Pune. This has been a pivotal propelling factor in the rise of startups in the state.
According to the National Restaurant Association of India (NRAI), the restaurant industry is expected to contribute about 2.1 percent to the total GDP of India by 2021
Growth Rate of the State
The Indian F&B Food and Beverage service industry is one of the most vibrant industries which has witnessed rapid and unprecedented growth over the recent past. In addition to that Maharashtra being extremely cosmopolitan state, Mumbai & Pune being the commercial hub, the hotel industry has flourished incessantly. As per the Invest India research, processing sector in the state has alone attracted over US$158 million worth of investments through 173 projects in the final decade of the 20th century.
According to the National Restaurant Association of India (NRAI), the restaurant industry is expected to contribute about 2.1 percent to the total GDP of India by 2021. Not to forget, the entire processing industry contributes a whopping 33 percent, according to IBEF. By a similar report, the QSR sector which was around INR 9,000+ crores in 2016 is expected to grow up to INR 24,000+ crores, while the Food service industry is expected to hit INR 5 Lakh crores around the same time.
Hurdles and Next
Although the foodservice industry is expanding its wings, it has certainly sustained the major issues prevalent in the state. To begin with, the rising food costs impacted by delayed monsoons, the economic slowdown and unfavorable demand-supply conditions are key factors affecting the food industry.
Competition in the food sector has manifold which leads the service players to tailor their offerings from time to time be it the menu, the format or the concept, in order to retain its position. With the increasing costs of real estate and legal formalities which follow and the cost of labour has taken a toll over major restaurants.
Startups of a new kind, like Food Trucks faced quite the stir from local corporations - not just on the safety angle but on the whole set up of the business. Bribes, politics, pestering by local authorities only add to the woes of the startups.
Loss of cuisines is the most dangerous, yet the most underrated factor. With the dicey and uncertain business, several startups draw the curtains before they see the light of the day. This causes loss of dishes and with it, many cultures going down with it.
With the advent of technology, digital marketing bloomed and grew manifold in the 21st century. Online food portals, food-trucks, Michelin star restaurants, delivery service grew rapidly in the major cities. These startups saw a massive adulation by the city and became an instant hit. Now called as Food Aggregators, you will now find them present in the groceries and retail segment, hotels and food products.
Although some failed to live up to the expectations of the consumers, others managed to dodge the wildest storm. While in some cases, a proper market research was the missing element whereas others failed to impress with their discoveries. The state saw the dominance of many different food products in the recent times discovered by the FBOs and also by the street vendors.
Maharashtra has not only served its typical cuisine but also rendered different variety of cuisines to the customers because of its metropolitan culture. That’s the reason why every person who is employed here is secured of the food available in the state. There were startups which sold organic food for ensuring the purest and unadulterated form of food. This saw a major invention by the farmers and other FBOs. Also, in a bid to provide the purest form of food, genetically modified ingredients were added to the products which contained chemicals to enhance its nutritional quality.
On what the Future holds
On knowing the survival of the food service industry, we can contemplate its run in the future with the support of many factors in the state. It has definitely surpassed all the hurdles and has proved its worth in serving the major contribution to India's Economy. Impressing the entire country with its exquisite cuisine, Maharashtra has stood the test of time. Well, major reforms are still awaited by this glorious state and all we can do is just wait and watch for its next moves.