Financial Daily from THE HINDU group of publications
Wednesday, May 24, 2006
Financial Daily from THE HINDU group of publications Wednesday, May 24, 2006 |
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Marketing
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Outlook Dabur to expand food services business Purvita Chatterjee
Mumbai , May 23 Dabur Foods, expecting to grow at 25 per cent in its foods services business, has projected a turnover of Rs 100 crore in the next three years. The wholly owned subsidiary of Dabur India has decided to extend the scope of its foods services business to include a range of cooking products and move beyond supplying beverages to its institutional buyers. Speaking to Business Line, Mr Sanjay Sharma, General Manager, Sales & Marketing, Dabur Foods, said, "At present we are mainly supplying beverages to our institutional customers but now we are extending the range to include tomato-based products." Under the `Nature's Best' brand meant for its institutional buyers, Dabur Foods now intends supplying tomato purees, ketchups and dressings to the smaller food kiosks and 5-Star hotels. Adds Mr Sharma, "There is a need for packaged solutions, especially from the smaller eating kiosks that lack space in their operations. Besides, tomatoes are used most in Indian cooking.''
Eyes 25% growth
Currently the food-service business generates a turnover of Rs 50 crore and is growing between 18-20 per cent. "We expect the food-services business to reach a Rs 100-crore turnover in the next three years with a 25 per cent growth year-on-year,'' states Mr Sharma. At present the company's institutional buyers comprise a host of BPOs and call centres as well as several bars, hotels, airlines and canteens. It has also started supplying its garlic paste to the Domino's pizza chain. Estimating the food and beverage segment at Rs 1,500 crore, Dabur Foods expects to scale up its presence in this segment by extending the range of its products and going beyond supplying beverages to its institutional buyers. Meanwhile, Dabur Foods is also eyeing generating revenues through the business of category management with retailers. It has already entered into an agreement with the Food World chain to manage its juices category.
Not enough data
Adds Mr Sharma, "In spite of modern trade growing, there is still not enough data available to study the footfalls and growth of the different categories. Modern trade has yet to get better-organised and not all retailers are using the data to study category management in the country.'' At the same time the company's sales from modern trade still comprise a miniscule segment of its Rs 191 crore sales turnover. Claims Mr Sharma, "Our sales from the modern trade presently comprise about 14 per cent of our total sales. However, we expect this figure to get bigger over a period of time.'' Dabur Food's largest brand continues to be its Real brand of fruit juices. It has recently also entered the category of fruit drinks under the Coolers brand which is pitted against brands such as Frooti and Maaza. In the recent past, the company has set up a new manufacturing base in Jaipur, while the rest of its manufacturing continues to get done at its facilities in Nepal, where it can avail itself of tax benefits.
More Stories on : Outlook | Foods & Food Processing | Dabur India Ltd
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