Tuesday, August 13, 2013 08:00 IST Abhitash Singh, Mumbai
The country's biggest dairy brand Amul has plans to venture into a new territory - the fast-growing cookie space - by setting up a plant to produce 20 tonne of cookies a day.
Interestingly, the big players in the cookie and biscuit sectors are not perturbed but seem to be happy with this development and feel that it will aid the growth of the overall market.
Speaking to FnB News, R S Sodhi, MD, Amul Dairy, said, “The cookies market is really growing, in fact, booming. We are planning, but it is at an initial stage and we can't reveal anything about it right now. We have been selling cookies in chocolate, multigrain, butter and coconut varieties for two years in the Anand region, catering to neighbouring markets of Ahmedabad and Vadodara in central Gujarat.”
Revealing the Unique Selling Proposition (USP) of his new products, an optimistic Sodhi said, “Thinking about the long-term prospects we are looking at a 40 per cent annual growth for cookies, buns and bread that account for over Rs 20 crore. The USP of our cookies would be the use of Amul butter and consumers would like it.”
About the investment and the plant, Sodhi said, “The automated plant will be set up at Mogar in Anand. Since the planning is at initial stage, I can't say about the investment because we are not in a hurry to take our non-dairy business national.”
As for the overall market, Sodhi pointed out, “This segment is very competitive and is a low margin category. One has to put a lot of investment in branding too, though we succeeded during the test trials, we will have to wait and watch.”
Commenting on Amul’s plans, Parle Products group product manager B K Rao stated, “ The company is growing at a very rapid pace. The overall market for biscuits is Rs 15,000 crore. I am very much aware of the Amul entry into cookies market. Its entry into the market will expand the overall segment and there will be very good competition.”
He added, “Our most of the packets are priced at Rs 5 and maximum Rs 15-20. If Amul sells for bigger price points, then it will not be easily accepted by the consumers.”
When asked about impact of Amul’s entry on Parle, Rao said, “Parle has already made its reach in the national market and it has been appreciated by everyone. Amul will be coming up with premium cookies, which will be priced at higher rates making it difficult for the consumer to buy. So I don't think Parle will get the heat, if Amul enters the biscuit market.”
Iqbal Singh, owner of Prince Food Products, Punjab, a biscuit manufacturer concluded, “The biscuit sector in India is of more than Rs 10,000 crore and there are many small and big players in the market and thus the entry of Amul in this segment will be beneficial for the biscuit industry.”
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