From grandmother’s pickles and salted and sun-dried fish to the milk that comes in tetrapacks and stays fresh for months without refrigeration, packaged and processed food has come a long way, meeting the modern day demand for hassle-free instant food. Even fresh vegetables like green peas or cauliflower, once available only in the winter, are now available round the year, if only at a higher price.
In India, food processing is estimated to be a $121-130 billion (around Rs 7.5-8 trillion) industry, driven by the dairy sector (35%) and marine and poultry (32%), according to a report by Confederation of Indian Industry. Also, in India, only 2% of fruits and vegetables are processed as against 65% in the US.
However, off-season consumption of fresh fruits and vegetables is rising—the exotic lettuce available during the Delhi summer most likely came from the hills of Ooty in Tamil Nadu, the beans and capsicums from Himachal Pradesh, and the shiny apples likely travelled continents from the US, without losing their sheen or juiciness.
Once such food processing technologies are developed, retort processed foods that do not need rehydration or preparation, may be consumed straight from the pouch with or while not pre- warming, relying upon the necessity of the users and therefore the weather. These foods meet the particular wants of convenience, organic process adequacy, ambient storage and distribution to the centres and shelf stability have made these extremely successful and most suited to Indian cuisines. Hence a number of tasty Indian dishes in retort pouches enable consumers to enjoy their favourite foods such as sooji halwa, upma, and chicken curry. The use of retorting technology has thus created the sale of “ready-to-eat” foodstuff commercially viable with in vogue food styles.
The pioneer for the development of RTE in India has been the Defence Food Research Laboratory (DFRL), Mysore, which was established on December 28, 1961, under Defence Research and Development Organisation (DRDO) to fulfil the needs of varied foods of Indian Army, Navy, Air Force and paramilitary forces. Their aim is to design and engineer lightweight convenient packed food with longer shelf-life under varying climatic conditions - using the self- developed technologies, DRFL has produced many ready-to-eat, quick cooking and instant foods with longer shelf-life. Some of them are long-keeping chapatis (shelf-life six months), high protein snacks (shelf-life nine months), spiced potato parothas (six months), fruit bars (nine months), mutton pickle (six months), stabilised chikki (one year).
Today retort processing is the most acceptable form of food preservation. These are ready-to-eat food products which require just warming in a microwave oven or water bath before eating.
Packaging of this food should withstand thermal processing. Retort pouch is the flexible laminated food package having light weight. It maintains the shelf-life, texture and nutritive value of frozen food. During war, soldiers can easily carry these packages. So they are very popular.
The selection of packing material of retort pouches is very important. It should have high melting point, physical strength, protect against light degradation, moisture changes, microbial invasion and oxygen ingress. It should resist penetration of fats, oils and other food components. Packing material should not contaminate the food inside. Japan and European countries use a multilayer polyester with 7-20 micron thickness aluminium foil and 75 micron thickness polypropylene for retort pouches. But they are very expensive for our country. DFRL by its research tried polypropylene (PP) and co-extruded material of polypropylene-nylon-polypropylene (PP-Nylon- PP). This packaging structure is now successfully used in the packaging of meat, vegetable curries, rice with meat and vegetables, sweet halwa, beans in sauce, and so on.
The ready-to-eat category was commercially first introduced to the country in 1987, but suffered a slow beginning with consumers preferring traditional cooking. During this period and till late 90s, Tasty Bites was the only brand of RTE available in the Indian market. Due to lack of acceptance, Tasty Bites had to be withdrawn from the Indian markets and is now available only in export markets. By the turn of the millennium, and the advent of new technologies to improve the shelf life of ready-to-eat products, alongside a growth in storage and distribution centres, and lifestyle changes the segment gained momentum.
With the development of retort technology, and increased differentiation among ready-to-eat players, the heat-and-eat segment broke away to become a market in its own right.
The RTE / heat-and-eat market currently valued at Rs 240 crore and has been growing at a rate of 18% over the last three years and over the next five years, though its rise will reach 22% per annum as a result of rapid urbanisation, increasing disposable income and expected improvement in retail infrastructure, touching over Rs 640 crore by 2019.
RTE foods are currently dominated by ITC, MTR Foods, Kohinoor Foods, Gits, Mother’s Recipe and Tasty Bite Eatables.
ITC and MTR together contribute to just under half of the market share, while the other players make up 45% of the total production of heat-and-eat food. Other players in the category include ADF Foods, Priya Foods and Heinz, which are relatively new entrants in the market with limited product lines and have a regional presence.
The category is largely export-driven as it is yet to establish a firm footing in the Indian retail market. However, domestic markets constitute 40% of the total revenues of heat-and-eat products. Sales mostly occur in urban areas, especially in Tier I cities, where retail infrastructure is significantly developed.
Even though retort processing is the best and the most acceptable form of food preservation for Indian cuisine and foods without any preservative and in its natural form – yet the acceptance levels in the Indian market can be termed as very poor to average only. Today RTE is bought only by bachelor men or working single women and working couples only and that too for use at times of emergency where they do not want to cook or have unexpected guests / visitors. It is never bought by families with children even where both parents are working. It is a known fact that when families do not cook food at home, they go out for eating mostly.
Today with most food service outlets having their own free delivery and the growing food delivery channels and websites for home delivery of restaurant food – families resort to ordering of restaurant food at home when they are not cooking. Hence RTE has to compete primarily with the free home delivered restaurant food in terms of freshness, taste and value for money.
RTE food suffers the following major misconceptions in the minds of the average Indian consumers which are the challenges that need to be addressed by the industry:
- The most surprising thing about RTE is that the Indian consumer has not been prepared for the product and hence most of the sales have been in the export market; The housewife till date has not been willing to accept a completely prepared product to feed the family due to apprehensions of reducing her role as the family’s provider; RTE foods contain preservatives; Not nutritional in comparison to fresh food; RTE does not have enough value for money; Most RTE is routine food such as dal, sambhar, and palak and is not a novelty; Some novelty products introduced by ITC were priced very high; Availability is limited majorly in modern format stores.
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Type of Outlets %
Chemist 0%
Grocers 39%
Pan Plus 1%
Food Stores 10%
Modern Format Stores 51%
- The penetration of RTE till date has been very low into outlets and households.
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Total Number of Outlets for RTE 28561 (Source: Nielsen Data)
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% Penetration of RTE Category in ‘A’ (Assumption : Universe of
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Category Outlets 13% Outlets is 2,22,330)
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Total Number of RTE units sold 6319200 (Source: Nielsen Data)
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% Penetration of RTE in Sec A1, A2 (Source: IRS Data for A1, A2
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Households per month 2% households townwise)
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Social Changes driving the RTE Trend in India
The RTE food category has a tremendous growth opportunity in the near future due to a growing number of nuclear families. The Federal Home Ministry has recently released the final figures of the first phase of Census 2011 known as House Listing and Housing census in New Delhi. The data states that India is now overwhelmingly made up of nuclear families — a dramatic change from just a generation ago, where joint families were the norm. Seventy per cent of the households consist of only one couple.
Increased urbanisation
There is an increasing population of Indian women that has neither the time nor the knowledge to cook traditional meals on a regular basis. Indians have become more experimental with their food and drink choices as there is need for variety.
Growing practice of singles living away from home for education or work
MRP of RTE (Value proposition of RTE): Today a Single Serve pack costs Rs 65 to Rs 75 whereas the same dish to be ordered from a nearby quality restaurant costs around Rs 130. Few years back, people would be least interested in stocking up RTE at home as they could just walk across the road, find a restaurant and order meals. However now that people work late nights at office and return home at a time when restaurants are closed RTE seems to be the best option.
Change in Mindset:
From a mindset where home-cooked and fresh food was preferred and housewives insisted on making everything from snacks to multi-course meals in- house, today it has become commonplace to seek convenience and variety using the vast menu of ready-to-eat foods available. 44% Indians admitted to not having much time to cook, while 23% felt ready meals were affordable (Source: Euromonitor, January 2013)
Food as convenience and novelty: The variety of ‘ready-to-cook’ and ready-to-eat food is growing, thus helping the housewife in her quest for novelty. Thus with increasing working woman segment, increasing work and study commitments, declining culinary skills, the rising need for convenience, and surging disposable incomes, along with clever and innovative marketing will all lead to a higher demand for heat-and-eat products.
