Food retail driven by marriage of bricks and clicks: Panellists at VCCircle event

By Debjyoti Roy

  • 22 Nov 2018
Credit: Pixabay

The marriage between bricks-and-mortar and e-tail, as well as tech disruption, has been the driving force behind food retail, felt panellists at News Corp VCCircle’s Food & Agri Investment Summit 2018 held in Mumbai on Thursday.

The panellists said that these two factors, besides a lot of investor interest and awareness on healthful food, have led to the emergence of players such as Chai Point, which operates a network of tea stores, and Doodhwala, a milk and daily essentials delivery startup.

The panel comprised Ebrahim Akbari, co-founder of Doodhwala; Amuleek Singh Bijral, co-founder and chief executive of Chai Point; and Kuchibhotla Srinivas, partner, food, agriculture and retail practice, KPMG.

The co-founders shared their thought process that drove them into the business and also reflected on their expansion plans.

Akbari said that fresh milk aggregation has a huge future in India, the world's biggest consumer. “Given that it’s such a mass commodity, in the next decade the demand will double. It will then be tricky to meet that demand,” he said.

He highlighted that, although the rural network for milk supply was always there, Doodhwala optimised last-mile distribution for delivery at the doorstep. “Supply chain is the key,” he said.

Bijral said that the tea is considered as a “ritual” in the country, and the very idea that it can be sold through a large business model was the inspiration behind the growth of Chai Point.

Bijral said that their omni-channel presence -- delivery, outlets and dispensers – helps them reach people.

Besides tea and milk, fruit and vegetables is another segment where a lot of business models are coming in. “Packaged, cut and chopped vegetables is one of them. It will also help the consumer side,” Bijral said.

Bijral said that lack of infrastructure posed a problem for further expansion but added that a good supply of real estate is coming up in two years.

The panellists feel they have a lot of headroom for growth in the cities they are operating in.

“Tea retailing is Rs 1.5 trillion market and we are not even 0.1% of it,” Bijral said in this regard.

Doodhwala co-founder Akbari also pointed out that Bengaluru is their biggest market and there is a lot of growth for improvement.

The panellists concluded that a consumption-driven pattern has been the driving force for the expansion of most of the new age startups.