"We are focused on the domestic market"

Written by Alokananda Chakraborty | Updated: Jul 28 2009, 06:01am hrs
Sanjay Nandrajog
It is not easy to crack a market that has quite a few established players with deep pockets, and where consumer habits are difficult to change. But Sanjay Nandrajog, CEO, FieldFresh Foods, a 50:50 joint venture between Indias Bharti Enterprises and Philippine-based Del Monte Pacific, believes the company he is spearheading in India has a portfolio that few can match and a marketing model that is difficult to duplicate. Nandrajog, who holds a BTech and an MBA, and has served as market unit director of PepsiCo, also thinks this is as good a time as any to enter a market that is known for its price sensitivity. In this interview to FEs Alokananda Chakraborty, he explains what makes him so confident.

Do you think it is appropriate to launch your products in a new market when the economy is in the grips of a slow-down and people are tightening their purse strings

The current economic scenario provides an excellent opportunity to introduce a new range in the market at attractive costs (acquisition of marketing properties, promotions etc). We are excited by the initial market feedback to our products and hence we intend to ramp up our drive towards wider geographical expansion and deeper penetration of the market.

Are Del Monte processed food products available across India The proposed facility, to be established near Hosur in Tamil Nadu, is expected to start operations in the next year 2010. Will you start by importing packaged juices to begin with

Del Monte products are already available across Indiathey are present in all leading outlets in key metros. These include retailers such as Spencers, Reliance Fresh, Foodworld, More etc. The products are also available at Bharti Retails EasyDay stores. Since our manufacturing facility at Hosur will start operation in the year 2010, we will be importing all our products for the Indian market till then.

At the launch conference you said, Besides establishing a strong retail presence, we plan to leverage growth avenues in the business-to-business segment. Please elaborate.

Del Monte products will be available across different channels both retailmodern trade and general tradeand also with food service customers, including the HORECA (hospitality, restaurants and catering) segment and quick service restaurants.

Being a late entrant into the market, what do you propose to do to grab a significant share of the processed food and beverage segments

We have been present in the Indian market through FieldFresh and Del Monte is a well-known brand world over. Till now, the market feedback has been extremely positive and we hope to gain significant market share on the back of your offerings.

See, we are present in four categories of productsfruit drinks, ketchup and sauces, packaged fruits and vegetable and the Italian range including dry pasta, table olives and olive oil.

As we see it, our food service portfolio has the kind of products that will give us an advantage in the market. This product channel is largely underserviced and there is a lot of demand for such products throughout the year. To some extent this market is serviced by exporters, but the pipeline is not steady nor is it consistent in terms of quality.

All these people in the hospitality, restaurants and catering segments want a steady supply of quality products. We are bringing precisely those products from the Del Monte portfolio. The range will include fruit drinks such as pineapple fruit drink with pulp, pineapple orange fruit drink, and four seasons fruit drink (pineapple, mango, orange and guava) and packaged fruits such as pineapple slices, pineapple tidbits, prunes, fiesta fruit cocktail, whole kernel corn and peach halves.

We are supplying our products to Dominos already and will start supplying to Subway shortly. It is our offerings in the B2B space that will give us the head start.We also have the capability to customise our products. We have specialised people working with uschefs, nutritionists, food specialists who work closely with out clients to customise the products according to their needs.

Coming to the B2C segment, our primary target would be the housewife. For her, we have a website offering interesting recipes and cooking tips. Our olive bottles have recipes printed on them. Then there is a lot of sampling and magazine advertising. We know its going to be a long haul, but we are doing everything to make food interesting.

Most of the products in your portfolio are meant for home consumption. The out-of-home consumption market for juice/fruit-based drinks is also substantial and is growing rapidly. Are you looking at this segment also

Both home and out-of-home consumption markets are important for us.

For out-of-home consumption we have the range of Del Monte fruit drinks available in slim 202 cans. We are also planning to install dispensing machines at various places across 15 cities.

What is your assessment of the export potential of locally-sourced fruits and vegetables Are there any quality issues involved

There is immense export potential in locally-sourced fruits and vegetables. Our experience has been extremely positive working with nearly 250 farmers in Punjab and Maharashtra. The results of various trials conducted at our 300-acre Agri Centre of Excellence farm at Ludhiana, Punjab, has been shared with the farmers who have been very receptive in implementing the new agricultural practices. The challenges of farming in India are well known to everyone involved in this field. In the export field, there is a further challenge to upgrade the farming practices (global GAP certified) so as to meet international quality standards on a consistent basis.

The fresh produce business has achieved significant milestones in the short period that we have operated in. It is regularly supplying fresh packed baby corn to large retailers in the UK and in Europe. FieldFresh is the largest exporter of baby corn in the country.

Indias share in exports of processed food in global trade is only 1.5%, whereas the size of the global processed-food market is estimated at US$ 3.2 trillion. What are the steps needed by the government and private players to correct the situation

There are several initiatives that can be taken to push processed foods exports. These include indirect taxation, infrastructure development, development of talent pool for processed foods etc.

As far as FieldFresh is concerned, we are focused more on the domestic marketour export agenda is limited to FieldFresh corn. We believe we have a huge domestic market that is underserved and underpenetrated. Not many domestic players are looking at it in an organised manner. So at least for the medium terms we will concentrate on the domestic market.

Coming to the processed food industry, what kind of changes are organised retail expected to bring to the food and agriculture based industry

Organised retail is playing a pivotal role in bringing about changes in the fundamentals of the food and agriculture business not just for the industry players but also for the consumers. One thing that will change is the supply chain management and the quality of fresh products for the consumers. As organised players become more demanding, there would be more investment in supply chain management and through proper government policies private players will collaborate with farmers for their products.

What would be the focus of FieldFresh Foods future investment

Our future investments will focus on bringing in technology for manufacturing. In the processed foods business, the ramp up will be via channel build up, product development (innovation) and marketing. Our market entry and sourcing plans will be built on significant interventions in the supply chain.

The Indian market holds enormous growth potential for snack food, which is estimated at US$ 3 billion. Will this market be the next logical step for Del Monte in India

We will evaluate market opportunities and track evolving consumer trendsboth in terms of lifestyle and also in tastes. Our new products will be launched based on the outcome of these evaluations.

Del Monte also has a range of pet food products in its global portfolio. Are you planning to introduce such products in India anytime soon

Currently, our entire focus is on the products we have entered the market withfruit drinks, packaged fruits, the Italian range, ketchup and sauces and whole kernel corn.