Packaged Snacks Food Business in India

Last Updated on December 6, 2022 by DesignerPeople

We Indians are crazy when it comes about snacking and its varieties. Though we are known for our diverse cultures, the one thing which keeps us going is love for a variety of snacks from each state. We can say “divided by states, united by snacks”. Munching on namkeen and snacks is an ancient practice in India.

Along with famous snacking brands such as Haldiram, Bikanervala, Balaji Bikaji foods, there is various other Indian traditional snacking market which is majorly driven by small and unorganized players. They sell fresh regional savoury snacks at lower price margin.

Namkeen has the Highest Market Share in India Snacks Market. The segment of branded is expanding at a rate of approx. 15% / annum, whereas the entire market is growing at the rate of 7-8 per cent.

Brands today are focusing on tapping an opportunity by launching snacks meant for specific occasions, like to uplift the mood, fasting and provide some fun. With consumers snacking for various reasons, brands are highlighting events or value proposition/benefits offered on the snack pack.

The Indian snack market will be in boom with more than INR 1 Billion by the end of 2024. The future of India Snacks Market will grow with double-digit CAGR for the time frame of 2018 to 2024.

Indian Snacks Market is growing due to following factors growing middle-class population, lifestyle changes, rising urbanization, local availability and availability of snacks in small package Size, low Price and company’s strategies to focus on regional taste.

To indulge the taste aspect of snacking beyond local flavours, global flavours are also being introduced. Global flavours, combined with nutritional benefits, appeal to consumers who are looking at balancing the taste-health equation.

Healthy snacks market Size Worth $32.88 billion by 2025

WHAT DOES PACKAGE FOOD MEANS?

Food Packaging means the food which is in pack form with protection, preservatives, and various chemical which helps to keep it fresh for a long time such as ready to eat meals, Chips, Beverages, Cakes & Biscuits, nutria-bars and many more.

HOW TO START A SNACK BUSINESS IN INDIA

To start a packaged snack business, you will first have to analyze what kind of food people prefer in their locality.

You need to be very clear that for which product you can show your brilliant idea. Like all other businesses, you must also have a product to sell, which will be unique from others and remain in demand forever. Make sure that you won’t sell those products which are prohibited in your locality. Also, make sure that which snack item you want to go ahead with.

1.COSTING

1.Labour charges should be included within the product price

2. Packaging will help to evoke the customer, make sure to fund little extra amount to do it, so we also have to make sure that packaging amount will also be involved in the product price.

3. If you are selling a product, then there is a need to get enough profit for it. So make sure you will get a minimum of 10% of the profit on it.

2.MARKET OPPORTUNITY 

The Indian snacking food industry is a booming and promising sector in the FMCG category, that’s major because of the evolving consumer changes in change and consumption patterns. The shift in demographics is fueling modifications, as the fixed three meals a day’ model leads no longer be relevant.

The consumption has been increasing, and as a testament to this, the market for snack food segment is on the rise. The revenue in the snack food segment amounts to over $5000 million in 2019, and the market is expected to gain annually by 7.5% (CAGR 2019-2023).

3.REGISTRATIONS AND LICENSE 

For the manufacturer, there are different licenses to be obtained.

First, you have to get pollution clearance from your state pollution control Board.

Next, you have to get registered with District Industries Center for putting up a factory. You have to obtain power from state power Boards. After that, you have to get licenses as required by FSSAI, fire, shop and establishment licenses are also mandated.

Having obtained the desired licenses, you have to either rent a factory shed or build your own. You should have a unique logo for your business, as well as it should be registered to maintain the transparency between the customer and you. It helps the consumer to build trust for your brand.

4.AREA REQUIRED 

The need to find an area which will be appropriate for the selling purpose; it can be your residential place as well. You can also convince the average shop’s owners or any grocery shop owners to buy your product in bulk, which will be a great achievement for your business.

Find a place with a huge count of target audience & make sure that there is no similar business done, which can show a drastic effect on your business. Use the banner for promoting your product, and the banner should be beautiful.

5.RAW MATERIALS REQUIRED

Whatever can be the actual snack product, the dominant raw material should be purchased from the direct farm, which will reduce the cost of raw material. The quality of the product depends on the quality of the raw material after that ensure that the raw material purchased is of excellent and standard checked quality. You need to find the raw material supplier which will be nearer to your plant that will continuously provide the raw material reducing the cost of transportation.

6.MACHINERY USED 

Based on the scale of business, the level of advanced types of packaging machinery is used. If the industry is massive, international and giant, then automatic techniques are rendered while for small and home-oriented business, the level is necessary.

Some of the machinery which are used in snack business are snack food processing feeders, metering systems and equipment, self-cleaning continuous mixing processor machines. Products include mixers, blenders, stuffers, grinders, cookers, food smokers, conveyors, loaders, dumpers, ergonomic lifts, sanitary tanks, vats, racks, platforms,snacks packaging machines and many more.

CHALLENGES FACING BY PACKAGED SNACK INDUSTRY

1.STRONG PRICE COMPETITION

Increasing international and domestic Companies are entering into market at fast-growing pace. Indian snack food market is dynamic in pricing each brand is facing cut-throat competition with minimal margins. To sustain market share with pricing is a major task.

2. LACK OF INNOVATION

International companies are exploring in India with their innovative technology and capability; hence for domestic companies, this acts as a challenge to catch up to their excellent standards and speed.

Budget crunches which lead in failing the adopting of skilled manpower, also demotivate the scope of innovation in the company. Changing customer lifestyle and preference is very important for brands to keep them updated to the latest trends and changes.

Also Read: Product Packaging Design Complete Guide

3.HEALTHY SNACKS

As consumers interest in snacks is increasing, they’re also demanding healthy, diet-friendly alternatives to traditional junk food. Snack companies are now producing sugar-free, ketogenic and healthy convenience food. Customers are very clever these days they ensure to read authentic information on the packaging; hence brands have to strive hard to ensure quality and nutritional standards to ensure its productive outputs. Brands have to invest in research and conclude with authentic and exciting health facts.

HOW SNACKS FOOD STAND OUT FROM THE COMPETITION?

BRAND IDENTITY 

Snacking brand have to be ready with its brand colour, design and logo, which will be aligned with its brand personality and story. Brand identity will also include its corporate stationeries, and everything should be consistent and coordinated with each other.

BRAND IMAGE

If a brand is into organic or nature-oriented ingredients focusing on health benefits, then it should display its image as a sustainable brand. If it is focusing more on kids with fun-oriented elements, then the brand image will be as vibrant and cheerful. Basically, it is an impression of the product which is held by real or potential consumers.

BRAND POSITIONING

If your brand is catering gourmet, budget, health or organic should be decided because depending upon this positioning strategy is framed and designed. It is a very crucial task of achieving the space in the mind of consumers which will last for an extended period.

BRAND PERSONALITY

Brand personality is a set of features and characteristics similar to humans that are attributed to a brand. A well-defined and developed brand personality will give consumers the ability to relate to the brand and develop a preference for it

PACKAGING DESIGN

The packaging design is the first point of contact between client and brand. Hence it should be able to reflect the brand story, personality and its positioning statement through packaging design. The colours, font, images, illustrations and graphics play a vital role in successful results once the product is on shelves.

MARKETING COLLATERALS

It will include banners, brochures, newspaper ads, websites, posters and stationary. Newsletters, blogs, and promotional items, everything which acts as brand touchpoints will consist of in collaterals. Snacking industry is dynamic; hence to cope up with changes and to align it effectively with marketing collaterals is an emerging challenge.

DIGITAL MARKETING

Millennial snack as much as four times a day, and they dominate the entire snack industry. Social media marketing is driving up snack; they are redefining the traditional snack and transforming the snack into a meal.

Marketing and PR Strategy for a Snack Brand through a digital medium is to establish your brand message, way to interact, clients, social media helps to promote healthy lifestyles by offering fitness tips and value-added benefits/facts.

MOST COMMON PACKAGED SNACK IN INDIA

1) NAMKEEN

Namkeen acts as the capital when we talk about the snacking industry. The industry for namkeen and snacks in India is about one lakh crore INR. Indian consumers from ages have been indulging into varieties of Namkeen from each states few traditional snacks are such as sev, mixtures, bhujia, peanut mixture and many more which are contributing to the impressive growth rate of the firms. Today more than 1,000 snack items are sold in India spanning various tastes, forms, textures, aromas, bases, sizes, shapes and fillings.

Around 30% coverage of this market is in the hands of organized trade players and dominated by Balaji, Haldiram’s, Bingo, Prataap Snacks, Bikanervala, DFM Foods, among others.

The branded segment is expanding at a rate of approx. 15% per annum, whereas the entire market is growing at the rate of 7-8 per cent.

2.CHIPS

When we talk about chips bag, 90% it is about potato chips or famously known as wafers.

A busy lifestyle long working hours have forced people to shift from meals to desk snacks and potato chips packaging. Savoury Snack brands in India are branching out from original recipes and launching line extensions that deliver exotic flavours, ingredients,  and textures to consumers looking for new experiences or alternative parts for health reasons.

The famous chips which are seen in India are potatoes, banana, tortilla, multigrain and other variants.

 

3.STICKS AND PUFFS

The puff and sticks can be Corn or any other base which acts as a crispy & crunchy snack which everyone can enjoy. There are various exciting flavours of such as pudina, masala, cheese, tomato and many more. Brands keep on adding more characters and more innovative products to satisfy the ever-growing demand of kids as well as grown-ups. There are also brands who introduce the product with creative and funky shapes in order to appeal to kids.

4.WAFERS

They are a trendy type of snack in all age category. From potato with various flavours (tomato, cream onion, salty, masala are some of the few notable variants)

It acts as a super crunchy snack with jolts of characters, and it can be from hand made, baked to machine-made wafers.

5.NACHOS

Nachos are by definition typically comprised of corn chips as a base. These are considered to be the most healthy option these days because they baked and not fried. They also provide other health benefits by being gluten-free, zero cholesterol, zero trans fat and yes contains up to 40% less oil than regular potato chips.

6.POPCORN

It has now become one of the most popular snacks, no longer a complementary companion to be munched while watching sports, movies, or any favourite show. But, one can find this humble snack everywhere around from convenient Indian store, kiraanawaalas, fancy stores in malls to various online platforms. And it’s not about salty and sweet; popcorn comes in different types of flavours.

7.DRY FRUITS

Dry-fruits play a vital role in the Indian scenario, from festivals, celebrations to cooking and part of healthy munching it is in demand always. Dry fruits act as a great source of proteins, antioxidants, vitamins, minerals, dietary fibre, and health experts recommend eating dry fruits to be healthy. Majorly seen in a ziplock and heat sealed packaging with a motive to maintain its freshness and away from moisture.

8.BARS

There is a lot of buzz going around energy and nutria bars, energy bars, Nutri bars act as supplemental bars containing cereals and other high energy foods targeted at people who require quick energy on the go. Nutrition bars have exploded into the scene as meal replacements and ‘healthy’ snacks. One can gain benefits such as weight loss & muscle gain and hence satisfy cravings by snacking on these clean & healthy low in sugar, calories and carbs.

9.BISCUITS AND COOKIES

India is a country which runs on tea and what could be a better accompaniment to a good cup of tea than a biscuit or cookie.

Consumption in rural India, which accounts for about a third of the market, has been under stress over the past three quarters. Cookies are majorly known for their hand-baked, home-made, with variety of ingredients in it which again differs as per need and requirements. Not only kids but even adults enjoy relishing the divine taste of cookies and biscuits.

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Author: Megha Malik

As a passionate entrepreneur and creative brand consultant with experience of 14 years in digital, branding and packaging industry, it is my honest effort to put my experiences and knowledge of industry towards readers. A chartered accountant by degree but a marketing personality in blood has motivated her to take in designing industry as a career. With her fun-loving personality and sharp branding skills, she is a great motivational speaker on her YouTube channel, an active member in various business channels offline as well as online. Do connect me personally via my LinkedIn and I love to share my expertise with you.