This campaign not only highlights the brand’s commitment to quality and cultural roots but also marks its evolution from a local staple to a globally recognised brand.

This transformation is emblematic of a larger shift within the Indian F&B sector—once dominated by global brands making inroads into our local markets, we are now witnessing an era where homegrown heroes like iD Fresh are expanding beyond national borders and setting the stage on the global market.
In this issue, we delve into the dynamic evolution of the F&B industry in India. Join us as we uncover the factors driving this shift and the opportunities it heralds for the future.

India’s Food & Beverage (F&B) sector is one of the fastest-growing segments in the D2C landscape. As per ET Hospitality, as of 2023, industry estimates suggest that the domestic food processing segment alone is expected to reach USD 470 billion by 2025, up from USD 263 billion in 2021.

This growth is underpinned by several key drivers such as –

Here are some interesting statistics about the F&B sector –

The growth in this segment is largely driven by the burgeoning Direct-to-Consumer (D2C) trend, where innovative startups are introducing diverse product ranges, capturing a 27% share of the market.

The Indian F&B sector, underpinned by a robust D2C model, continues to demonstrate remarkable dynamism and growth. The sector, with companies that manufacture packaged food and beverage products under their own brands, has seen significant financial activity, capturing the attention of investors and consumers alike.

In the last two years alone, the D2C F&B sector has attracted a staggering USD 9.3 billion in investments, indicating a clear vote of confidence from financial markets in the potential of these brands. Prominent companies like Country Delight, Open Secret, and Akshayakalpa lead the charge, representing a blend of innovation and consumer-centric approaches.

Let’s delve deeper into the economics of some of 3 new-age brands.

iD Fresh Food has carved a niche in the ready-to-cook segment with its flagship products like idli and dosa batter. Their range extends to other homestyle staples such as parathas and paneer, catering to a wide demographic that values freshness and authenticity in their daily meals.

iD Fresh Food has effectively utilized Direct-to-Consumer (D2C) channels to bypass traditional retail barriers, creating a direct connection with their consumers. This strategy has not only enabled them to maintain control over their brand experience but also to gather valuable customer data to enhance product offerings.

Through a robust online presence and strategic partnerships with e-commerce platforms, iD Fresh has built a loyal customer base that relies on the convenience and consistency of their products. Their focus on quality and customer service continues to drive repeat purchases and sustain a strong community of brand advocates.

However, FY23 marked a significant turnaround with the company reducing its losses to INR 328.8 crore, a substantial 53% decrease from the previous year’s loss of INR 703.7 crore. This improvement highlights enhanced operational efficiency and a reinforced commitment to profitability.

Licious has distinguished itself in the meat delivery market with its commitment to delivering fresh, high-quality meat and seafood directly to consumers. Licious offers a range of products from fresh chicken and seafood to marinated meats and ready-to-cook delicacies.. Their stringent quality controls and farm-to-fork model cater to health-conscious individuals and families who are particular about the provenance and handling of their food.

Licious harnesses the power of D2C channels to streamline its operations and enhance customer experiences. By controlling the entire supply chain, from sourcing to delivery, Licious ensures product quality and freshness that traditional retail channels often compromise. Their user-friendly website and mobile app facilitate easy ordering and customized selections, enhancing consumer convenience and satisfaction.

Regular promotions, subscription plans, and loyalty rewards further incentivize repeat purchases, helping Licious build a devoted customer base. The direct feedback mechanism enabled through D2C interactions allows Licious to quickly adapt and innovate based on consumer preferences and demands.

Paper Boat has made a mark in the beverage industry by revitalising traditional Indian drinks with a modern twist. Their products, including flavours like aam panna, jaljeera, and kokum, appeal to consumers looking for nostalgic tastes with the convenience of ready-to-drink formats.

Embracing D2C channels, Paper Boat has effectively bypassed traditional retail constraints to connect directly with its audience. This approach has allowed the brand to craft a unique narrative around the cultural significance of its offerings, enhancing consumer engagement through storytelling and interactive marketing campaigns.

Paper Boat’s adept use of D2C channels illustrates how brands can leverage digital marketing and e-commerce to enhance brand recall and foster a community of loyal customers, all while delivering a product that resonates deeply with cultural values and modern preferences.

The analysis of these brands’ performance reveals key insights into the shift in the F&B market trends such as:

As per FNB news, the F&B industry in India is expected to reach nearly USD 504.92 billion by 2027, with a compound annual growth rate (CAGR) of 11.05%.

Here are some trends in the F&B sector in India:

1. Convenience and on-the-go consumption

Driven by the tier 1 and metro cities, the busy lifestyles are boosting demand for convenient food solutions, including ready-to-eat products, meal kits, and mobile ordering.

2. Emergence of House of Brands (HOB’s)

The “house of brands” strategy is a practice where multiple brands are owned under one umbrella, which has been pioneered by early players in the Indian food services industry. These players include Curefoods, Rebel Foods, and EatClub, which own diverse cuisines under one roof. The success of HOB’s is attributed to the fact that they rely on average revenue rather than betting on just one brand.

Consumers are increasingly looking beyond western brands, reversing a long-standing trend. There’s a growing appreciation for local brands such as Slay Coffee, iD Fresh, etc that champion our unique culture and preferences on a global stage.

The trend toward health and wellness continues to surge, with an increasing number of consumers opting for organic, gluten-free, or additive-free products. Sustainability and ethical sourcing have also become critical factors in consumer decision-making, influencing how brands shape their products and market themselves.

This rise of Indian D2C brands in the F&B segment exemplifies the exciting shift happening in Indian kitchens.

No more last-minute dashes to the crowded grocery store. D2C brands are enabling us to access high-quality, convenient options delivered straight to our doorsteps.
But here’s the interesting part. This isn’t just about convenience. These brands are redefining what it means to eat Indian food. They’re innovative, health-conscious, and most importantly, understand the value of tradition.

So, the next time you are shopping for groceries or food, explore some homegrown D2C brands. You might just discover a new favourite that brings back cherished memories while perfectly fitting your busy lifestyle.