Indian consumers seem to have recovered their taste for traditional snacks such as farsan,

bhujia and namkeen going by the impressive growth rate of local firms such as Balaji
Wafers and Bikanervala at a time when their multinational rivals are struggling.

Local snacking companies such as Balaji Wafers, Prataap Snacks, Bikanervala, Bikaji Foods
and DFM Foods BSE 6.79 % have recorded sales growth of 8-35%, in the year ended March
2016 even as international food majors such as GSK Consumer, PepsiCo's food division
and Mondelez struggled to grow their business amid slowing rural demand and discretionary
spends.
t's not that the local players'impressive numbers came from a very small base. These five
firms have combined sales of nearly Rs 3,700 crore, that is higher than Nestle's Maggi, and
a few of these firms are larger than Kellogg's in India

 Local manufacturers have combined sales of nearly Rs 3,700 crore, that is higher than
Nestle's Maggi, and a few of these firms are larger than Kellogg's in India.
 Local Snacking Companies are keeping the overhead costs low so that their products remain
affordable.
 sweet and savoury snacks have grown by 26%, highest within packaged food segment between 2010
and 2015. About four years ago, packaged namkeen had replaced western snacks such as potato chips
and finger sticks as the largest segment within branded salty snacks market.

"Domestic manufacturers are increasing their distribution and penetration into rural India and have
launched smaller packs at lower price points," Euromonitor said in a recent report.

The research fi ..

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According to market researcher Euromonitor, sweet and savoury snacks have grown by 26%, highest within
packaged food segment between 2010 and 2015. About four years ago, packaged namkeen had replaced
western snacks such as potato chips and finger sticks as the largest segment within branded salty snacks
market.

"Domestic manufacturers are increasing their distribution and penetration into rural India and have launched
smaller packs at lower price points," Euromonitor said in a re ..
The research firm expects the salty snacks segment to surpass biscuits with sales of nearly Rs 35,801 crore by
2020, up from Rs 19,151 crore in 2015.

Funding from private equity funds helped domestic snacking firms to expand their reach and market their
products more aggressively, experts said.

 Prataap Snacks, maker of Yellow Diamond chips, was backed by Sequoia and has filed papers for an
initial public offering (IPO) to raise Rs 400 crore. The company, which clocked 35% growth in sales last
year at.`758 crore, recently roped in actor Salman Khan to promote its brand.
 Nearly two years ago, private equity fund Lighthouse Funds had invested Rs 125 crore in Bikaji Foods
while WestBridge Capital Partners picked up a 25% stake in DFM Foods that sells snack foods under
the brand Crax.

 The market is divided into 3 segments: chips, extruded snacks and traditional snacks. Each
of these have around equal share of the snack food market.
  The market is dominated by Pepsico, which with a market share of 38%, has more than a
third of the market. Pepsico’s leading products are Lays, which has ~50% share of the chips
segment; and Kurkure, which has over 50% share of the extruded snacks segment.
 The second largest company in snack foods is Haldiram’s which has 25% share of the
market. Haldiram dominates the traditional snacks market. These are snacks like bhujiya,
namkeen, and salted dals. Haldiram has close to 60% share of the traditional snacks
market.
 Gujarat’s Balaji Wafers is the third largest company with a market share of ~9%. ITC has a
share of 7%. After these, there are smaller companies like DFM Foods, Bikanerwala, and SM
Foods.

Online (B2C): Ecommerce Website

Offline (B2B): Corporate Counters : partnerships

Owned: need funding

Business Models

B2B Model (Offline)

Corporate Counters:
 We are primarily engaging with established brands which are not into supplying at
Corporates.
 Agreement between Indori Chatore and Corporate Company on setting up the
Corporate Counter.
 Initially Investment will be done by the ‘Representative’ who will be operating and
managing store but idea is to fully own and setup a corporate counter based on
Funding generated and exit criteria of the Representative.
 IC will offer Margin to the operator on the products which will be sourced by IC.
 The person will have the liberty to sell his/her goods from that store subject to
approval on which IC will take Margin
 Corporates will help us increase the volume by infusing other brands.
 We are working on a model, wherein we are not getting involved in the operations
and at the same time legally binding the representative to adhere with IC’s customized
agreements.
 A dedicated Marketing team approaches Corporates with IC’s Offerings to get an
opportunity to setup.

Distribution to Franchises, Shops:

 IC as part of its growing and evolving Distribution network offers and sells snacks to
Franchises and shops at a margin mutually decided by both the parties.
 Marketing Team converts leads of possible Franchises/Shops where IC sets up a
Contract on the products required and margins.
 IC pushes for new products at all the time and over the period maintains good and
healthy relationship with the channels.
 A dedicated Marketing team approaches Franchises & Shops with IC’s Offerings.
 Separate Margin structure for Non- IC counters.
Retailer 20-22%, Distributor 5-7% - Pune
Retailer 25%, Distributor 5-7% - Mumbai

B2C Model (Online)

Ecommerce:

 IC has its own E-Commerce Website through which it presents and sells exotic
products from different parts of the city.
 Just like other Ecommerce Websites, IC has many products to choose from which are
delivered in the required area within standard working days.
 In order to scale-up its E-Commerce operations, IC requires funds to match the
demand with the supply it can provide.
 There is a separate dedicated E-Commerce Team.