Summary of snacks industry:

Indian snack food industry comprises of many Indian as well as MNCs. The Indian snack market reached a value of $307.7 million in 2001. The Indian snacks food market is of the order of 400,000 tones. This wide range of products are categorized under Potato / Banana Chips, Namkeens & Fun-Foods. The organized market for chips is estimated to be 6500 tons valued at Rs.2 bn. The market for branded chips has been growing at a fast pace of around 20-25 % annually.Since the majority of MNC's entered their venture in Ready-To-Eat Snacks & Namkeens. The project was conducted to study the overall industry for Ready-To-Eat Snacks & Namkeens. The research was conducted to study the actual buying behavior of the consumers and their preference for such a category of food. Research methodology being exploratory research Questionnaire method to interview consumers as well as retailers was adopted. Retailers were surveyed to know the actual market behavior, whereas the consumers were surveyed to know their preference and factors affecting their purchase. Secondary data on industry is collected through Internet, magazines & by visiting the people in the industry.The Research was a good experience & the final conclusion is that the consumers generally associate Ready-To-Eat Snacks & Namkeens with Time Pass. Majority of them prefers wafers to be their first choice with Fraiams being the second preference. Namkeens on other hand are usually preferred as hunger quencher and are eaten whenever the consumers are hungry.Ready-To-Eat Snacks & Namkeens are generally considered as take away food and hence the consumers generally buy 1-2 packs and does not store them. Through the research it was concluded that the consumers want even POPCORN to be included in this category which is also an opportunity for the manufacturers to launch a new product and extend their product width. Overall the industry is grooming and has vast opportunity to be cashed for the manufacturers

Munching between two meals or at tea /coffee time is a habit with most Indians. The variety of snacks offered is almost mind-boggling with specialities from all regions, which have gained national acceptance. For example, banana chips from Kerala is sold not only across the country, but the entire world. Potato wafer is no longer considered a wafer-thin business. According to an Apeda (Agricultural and Processed Food Products Export Development Authority) survey, there are about 1,000 snacks items and 300 types of savouries sold in the country. Salty snacks – whether potato chips, banana chips or crispies made of corn or wheat flour, just fried or baked for the health-conscious – today have usurped home-made savouries to become the first choice not just for people in the big cities but also in small-town India. No wonder then, the market today for branded chips and wafers alone stands at Rs 1,100 crore. It has grown more than 60% over the last six years. And it is by far the single biggest item in the snacks and savoury category. 

The snacks food industry in India can broadly be categorised into three segments – staple (biscuits category), traditional (namkeens) and ready-to-eat packaged snacks (chips / crisps). The RTE snacks food is slowly but surely coming into its own, with a number of new / high profile entrants joining the fray. As consumers and companies turn experimental, as reflected in the new variety of snacks available in the market, extruded snacks which include the likes of PepsiCo India’s Kurkure will soon overtake potato chips as the biggest snack item in the Indian market. Extruded snacks are snacks cooked, pressurised and pushed out of a die that gives them their unique shape. According to a report by consultancy firm KPMG, the market value for extruded snacks which in 2009 stood at $223.7 million will touch $298.7 million by 2011. Not just that, it will be growing the fastest in the next five years.

While Haldiram’s, one of India’s oldest traditional snacks makers, and PepsiCo with its Lays and Kurkure brands dominate the market, the last five years have seen more companies join the fray. Not so long ago, the unorganised players had a field day with the consumer opting for quantity over quality. The trend is slowly changing with rising incomes and health-consciousness. Brand consciousness is taking precedence over cost consciousness among a large section of consumers. 

To PepsiCo goes the credit of expanding the organised snacks market. Till 1995, when PepsiCo introduced two brands Lays and Cheetos, there were only Haldiram’s and Amrit Agro that launched potato chips under the brand name Uncle Chips. When PepsiCo launched Kurkure in 1999, it became a runaway success. In 2000, Frito Lay India, a division of PepsiCo India, acquired the Uncle Chipps brand. And from then on there was no looking back. Aliva, the latest in its kitty, marks Frito Lay India’s creation of yet another category – borrowing ingredients and textures from biscuits and flavours from namkeens and is positioned as a healthier snacking option. 

The next big leap happened in 2007, when fast moving consumer goods company ITC launched an array of potato chips and finger snacks products under the brand name Bingo! Within a year, it grabbed a market share of 9%. Bingo brought tastes which were familiar to the Indian taste buds but with a hint of unfamiliarity. The next innovation in the market came in lesser time. Parle Agro’s Hippo and Parle Products’ Smart Chips entered the market in 2009. Currently, the salty snacks market stands at around Rs 7,000 crore. It is the high pace of growth that has attracted a lot of players. The increase in competition has seen players launching their own versions of the popular snacks of their rivals. 

Consumers now want variety and new tastes. They are not loyal to any particular brand. Another factor that has worked towards the shift from the home-made snacks to the branded packs is the price. It is challenging to give quality and quantity at the price points of Rs 5 and Rs 10. The bulk of the consumers are in the middle and lower middle classes. Therefore, affordability is what has driven the upsurge in the demand for snacks. 

Even as there has been a proliferation of brands in the salty snacks category, there has been a gradual shift towards offering healthier snacking options. Whether it is the no trans fat tag or healthier snacks like Smart Chips or Aliva, consumers are looking for healthier alternatives in every food category. “What is driving innovation in the segment is the need to balance taste and health without compromising on one or the other and break this credit-debit lifestyle we live every day,” says Deepika Warrier, marketing director, Froto Lay India, PepsiCo.

Several manufacturers are putting new face on snacks. One is appropriately named Sensible Portions that presents a wide range of “better-for-you” snacks including “all-natural” choices such as multigrain crisps, pita crackers and pita chips. In addition to convenient packaging that gives built-in portion control, ingredients like whole grains, soya protein, vitamins, iron, and fibre are included and trans fats, saturated fats and cholesterol are avoided. It provides a healthier feel to snacking that is highly marketable. 

Use of nuts in healthy snacks continued to rise including staples like almonds and cashews as well as exotics like pistachios and hazelnuts. Skinless almonds and cashews are roasted with real herbs and spices for extraordinary flavour. One line of almonds has been released with low-sodium sea salt, vinegar and bold wasabi soya variants . Another nut company introduced snack nuts that are gluten-free with all-natural ingredients and some organics like cocoa, vanilla extract and coconut. 

Peanuts can support and complement a vast range of spices and flavours. Peanut is a canvas upon which one can display works of art, delivering healthy snacks. Fat in peanuts is also healthy which can help lower LDL cholesterol and the risk of cardiovascular diseases. It is an excellent source of protein. 

Indeed, Indians continue to show a great appetite for snacks. According to a survey conducted by electronics payments company VISA on mystery spending or cash spent but which cannot be accounted by consumers, Indians spend the second highest on snacks. The average mystery spending per week of young Indians in the age group of 18 to 24 years stood at Rs 383 of which almost 36% was on snacks. The total spending per year on snacks for one person thus stands at around Rs 7,000.

As per data from The AC Neilsen Company, the compounded annual growth rate for snacks in the rural market over the last two years stood at 26.7% as against 13.2% for urban areas. Though rural’s contribution is only about 33%, it’s growing much faster than the urban markets. The way things are happening -- better spending power of the people, good knowledge and great exposure – better times are ahead for the snacks industry.

Cornitos-GreenDot’s Cornitos bags CMO Asia Excellence Awards in snacks category

Cornitos, the flagship brand of GreenDot Health Foods Ltd and the leading player in tortilla crisps in Indian branded snack food industry, has been awarded with the Best Food and Grocery Brand of the Year in Snack Category at the CMO Asia Excellence Awards held at Pan Pacific, Marina Square, Singapore. The brand was also conferred with a Certificate of Merit in ready-to-eat food category. 

The CMO Asia Excellence Award, which acknowledges global brands across various industry segments, adjudged Cornitos’ achievement in several categories in terms of Innovation, Product Diversification, Customer Satisfaction, Excellent Quality Standards and Market Leadership. 

The company stated that the brand created a niche in the industry as a healthy and tasty snacking option suiting the customer’s palate. Apart from 10 exotic nacho flavours it also offers authentic Mexican Salsa dips and Coated Green Peas under its Pop n Crunch range.

“Being awarded in two different categories by the illustrious CMO Asia is indeed a moment of great pride and privilege for us. Our team remains committed towards quality products bringing in affordable yet healthy snacking options thus attempting to usher in a conscious change in the snack industry in India. It is always fruitful to spend on consumer research. It is the product that matters eventually,” stated Vikram Agarwal, director, Greendot Health Foods Limited. 

“Cornitos is concentrating to increase the production and introduce premium product ranges this year and the recognition at this prestigious forum confirms our growing performance. I dedicate this award to my family members and our dynamic team and moreover special thanks to CMO Asia for this recognition,” he added. 

The brand has a pan-India presence. It is available across major FMCG stores such as Foodhall, Spencer's, Easyday, Nilgiri's, More, Hypercity, Auchan, and Big Bazaar. The nacho crisps are available for onboard sales in Air Asia, SpiceJet, Jet Airways, IndiGo, GoAir and Air India. It has presence in major multiplexes, airports and cafes. The products are exported to the US, China, Nepal, Singapore, Nigeria, Ghana, Maldives, Hong Kong and Sri Lanka.

Established in May 2009, the company was the first in the country to launch tortilla crisps in Indian branded snack food category. It came out with its brand Cornitos Nachos Crisps. Its production site in Roorkee is fully automatic and the highest hygienic standards are applied. Further, it is an ISO-22000, HACCP and Halal-certified company. GHFL has registration from FSSAI and US FDA and is member of APEDA and SFA. 

The company is a part of the well known ‘Globe Capacitors’ Group of Companies founded in 1978 by its chairman S P Agarwal and managing director Sanjay Agarwal.  

Snacks Market in India 2014This latest market research report titled Snacks Market in India 2014 elaborates the competitive market scenario of the Indian snacks market and its growth prospects in the ensuing years. Indian snacks market is experiencing rising demand due to various driving factors which in turn is providing immense opportunities to manufacturers to grow and operate in the market lucratively. The report provides a snapshot of the Indian snacks industry that has witnessed several changes since 1995. 

In the initial years, the market was dominated by two players – traditional snacks player Haldiram and ‘Uncle Chips' manufacturer Amrit Agro. Later on, with the entry of global beverage and snacks player PepsiCo, the market dynamics changed completely. Now, the market is dominated by PepsiCo with its wide range of product portfolio. The other major players include Parle Agro, ITC, Parle Products, Balaji Wafers and Parle Wafers among others. A number of regional players have also entered the market over the past few years and are giving tough competition to the big players. 

The snacks market is classified into two broad segments – Western and traditional snack segments,wherein western snacks enjoy more popularity in comparison to the traditional snacks. Moreover, the western snack segment is dominated by a large number of MNCs and organized snack manufacturers.

There are certain factors that have predominantly worked towards enabling the sector to grow in recent years. These include higher disposable incomes have enabled consumers to enhance their purchasing power, rapid urbanization which leads to busy lifestyles and subsequent inclination of consumers toward packaged food products and aggressive marketing campaigns by all the players to break the product clutter and attract consumers toward their brand. In addition to these, the other

factors which are contributing towards rapid growth of the industry include growing working women population, fast expanding retail network and the convenience factor associated with snack consumption

For snacks, quality standards laid by FSSAI have to be followed by the industry players. Various government policies that have been formulated for the food processing sector such as FDI, tax benefits and export promotions are applicable for the snack category as well.