There is an array of commercially available desserts to satisfy the consumer palate. One such specialty product in the category of frozen desserts is gelato.
The gelato industry in India is relatively new and developing to find its foothold among the consumers. The premium gourmet product that originated in Italy is slowly carving its share in the frozen dessert market.
Though generally considered ice cream, gelato is different technically. The frozen dessert is a low fat and high flavoured product. Unlike most industrial ice creams, it is prepared from fresh and natural ingredients. The gelato made its entry in the Indian market some seven years ago and basically caters to the premium consumer. With not many players in this niche business segment, there is lot of scope and untapped market to take advantage of.
Industry Snapshots
As per the latest market research report, India is considered to be the largest milk producer across the globe and has a one-fifth share of the total global milk production. The dairy industry constitutes of different sub-segments of which ice cream has seen strong growth in the market.
The Indian ice cream sector is a promising market with strong competition from the unorganised sector at regional levels. The Rs 4,500 crore ice cream market is divided into two segments, organised and unorganised. The organised segment covers approximately 60% market share. The unorganised segment, which constitutes about 40% of the market share, is nurtured by regional players with a strong local presence.
New Segments
Technology has made consumers more informed of various global trends, which in turn has changed their preferences. The consumers today are aware of global product basket and demand international quality products that include Italian gelato, mellorine and frozen desserts.
In India, gelato customers are divided into two independent groups: people who consume gelato and people who can be substituted from ice cream. Surveys published recognised ice cream as one of India’s comfort foods. In addition to these surveys, it’s well known that children of all ages enjoy ice cream. Ice cream, an old-fashioned favourite for children, still remains an enticing treat for people of all ages, and is likely to be the same in the future.
Market Opportunities
The whole ice cream segment is at a nascent stage in India. As per industry sources, the ice cream consumption in India is just 300 ml per person per annum, compared to 750 ml in Pakistan, 2 litre in China and as much as 23 litre in developed countries. But with higher disposable incomes and stronger distribution networks and cold-chain infrastructure, it has been growing at a CAGR of 15% in the last five years.
Challenges for Gelato Industry
The gelato gourmet industry has several factors that are critical for its growth prospects. These include issues pertaining to the supply chain mechanism and infrastructure requirements, and enhancing product awareness along with increasing consumer base for this specialty product.
Supply Chain Management: The shelf life of gelato is of few days only and mostly, it is freshly prepared and sold on daily basis. Therefore, the franchisors prefer having a manufacturing unit close to the franchise stores. The franchisee would need to place orders in advance mostly 24 hours, so that the franchisor is able to supply the stock on time.
Infrastructure: The refrigeration and display cabinets are typical and different from those used in regular ice cream stores. This is due to the fact that gelato is 10 to 15 degrees warmer than ice cream and requires different temperature settings. Unlike ice cream, gelato is not completely frozen solid. Moreover, the equipment is sourced from Italy and usually supplied by the franchisor. The gelato manufacturing involves typical recipes, equipments, production process and store formats.
Lack of Product Knowledge: Gelato has still to carve its identity as a different product other than ice cream. A large section of consumers are not able to differentiate between ice cream and gelato. In case of ice cream, the content ratio of ice cream to air is 30:70 and for gelato, this ratio is typically 70:30. Gelato is prepared from natural ingredients (milk and fruits), and is mostly fat-free (only 3 to 4 per cent of fat) and is more creamy, rich and tasty and therefore nutritious. However, the variations in gelato containing chocolate or nuts are more calorised. Also, there are other gelato products available such as water-based sorbettos, gelato cakes and shakes.
Small Consumer Base: As of now, the gelato industry in India is very small catering to a niche market. Its consumer base comprises those foodies who have knowledge and appreciation for the quality food ingredients and its history. The product is 100 per cent costlier than any other regular branded ice cream. Also, with many options available in the category of frozen desserts and ice creams, the gelato finds clientele in people who have a more refined palate. The current scenario is that the gelato market is limited to metros and tier-I cities.
Looking to the potential growth of this industry, the gelato segment is also expected to grow at parallel rate of 15% in the coming five years.
The ice cream market just started developing in the country in recent years, and in the main cities it is not difficult to find branches of big franchising companies. However, the distinctive product of our company, which we have to emphasise to attract Indian consumers is the original artisanal Italian gelato - something different from regular ice cream, using high quality ingredients.
Anil Group’s hospitality venture, Amazo Gelateria, offers a menu with unique combinations including variants of gelatos, shakes and tasty quick snacks. Gelateria is a typical Italian gelato shop that will provide its customers a unique European atmosphere, homemade Italian ice cream will become the location of choice for not only working adults, but for people of all ages who will enjoy the special taste of artisanal Italian ice cream.
Amazo believes in offering homemade gelato according to authentic Italian recipe. The second advantage is the healthy nature of the product sold in Amazo Gelateria Parlours. Italian lifestyle, which apart from fashion trends, signifies the alimentary products consumed and is famous all over the world as a standard to reach. Speaking about gelato, it should be underlined that it is less fat than, for instance, ice cream or many other desserts meaning that it is much healthier (while ordinary ice cream has 18% of butter fat, gelato contains 4-8% of fat).
Apart from the conventional range of gelato, which includes orange cookie, vanilla antica, cheesy strawberry and rose; Amazo offers exotic flavours like the ferrero rocher, Belgium chocolate, hazelnut, chocolate brownie, cheese cake and caramel latte. Keeping in mind, the seasonal taste preferences of its patrons, Amazo will launch a new range of gelato flavours in the coming months.
To sum it up, Amazo, which is known as a fat-free Italian dessert chain, operates in three different formats - Amazo restaurants, Amazo gelato kiosks and, recently launched, gelateria parlours, and steadily climbing popularity charts.
