Food is a mature category, which is adapting the New Normal exceptionally well. The key lies in creating the balance where businesses pivot and show agility in changing times. Companies that remain relevant will always be in a much better space to survive and succeed in tougher times. As long as companies are able to bring relevant differentiation in their products, are able to tell their story in an effective & engaging manner, they will be in the game, stresses food retail veteran Yogesh Bellani, Founder, Uttishta Partners , during this exclusive interview.
After being a part of food & retail world for over two decades, you have taken the entrepreneurial trajectory. How do you see the landscape shaping up?
About two years ago, it was board meeting of July 2019 that I asked Del Monte board to plan for a transition so that I can move on to newer opportunities after having served the business for over 13 years. I was the founding member and the first employee to start the Del Monte journey in India in January 2008. After having established Del Monte as one of the fastest growing Food & Beverages brand in India and having set up the business for a sustainable future, I decided that it was time to move on to more challenging opportunities. However, the turn of 2020 witnessed the worst human crisis in over a Century, and I had to delay the plans of moving out of the business. In October of 2021, post the second wave of Covid-19, I decided to move on, having already done succession planning for the business.
Beginning 2022, I along with three of my former senior-colleagues, launched Uttishta Partners. Here, our mission is to bring in pedigree international brands and launch them in India through our unique business model. We understand the Indian retail and food services ecosystem well enough, our platform partners with international brands to cut their learning and growth curve. It is an innovative business model that is in equal parts challenging, inspiring and exciting for all of us. I am also enjoying my role as an advisory board member with some of the leading organizations in the food & consumer space and am actively investing in the start-up ecosystem with my experience to help strengthen and scale promising businesses.
Talking of the F&B retail transition, I believe that multiple factors are at play. On the one hand, there is a shift from unorganised to organised at a sector level, given the aftermath of the pandemic and a growing concern amongst consumers for both food safety and hygiene, on the other hand, India is at the inflection point from a Consumption Boom perspective. With growing disposable incomes, greater awareness and willingness to try newer cuisines and experiences, the food & beverages sector is ripe for exponential growth.
While at home, during lockdowns, people started experimenting with various cuisines, which further led to a huge spike in the organised food retail. The good news is that the out-of-home food consumption is once again picking up, aiding the industry from the food services perspective. The last couple of years have only strengthened the organised food sector, which is an impressive feat.
What have been the crucial learnings during the tough times?
We went through massive disruptions in the last two and half years. There were demand disruptions on the food services side. There were supply disruptions in terms of raw materials procurement. In such trying times, I believe the two biggest learnings for all of us have been Patience & Resilience. The pandemic has really tested our ability to get the best out of the worst times and stay afloat. During the initial days of the pandemic, no one had any idea as to how to keep the businesses running and even taking care of our people, be it family or employees.
From the peoples' perspective, it has been a great learning for all of us. We tried to maintain a balance of keeping our employees safe, keeping them emotionally & mentally healthy and keeping the business afloat. Compassion was one of the biggest factors, which we, at Del Monte stood our grounds firmly on, all throughout the pandemic. I am the most satisfied about one big decision of ensuring that there was no loss of job during these times. We were able to keep everyone secured. We created support structures that could help people in need. The key lies in creating the balance where businesses pivot and show agility in changing times, and at the same time, keep the employees safety & happiness as priority because people are the ultimate asset for any organization's sustenance. When organizations take the humane stance, the response you receive from your people is phenomenal.
In fact, looking at the morale of our employees, our distributors & partners too responded in the same manner and the chain continued, which ultimately boosted the business sentiments and people's spirits. To share, we were the fastest to get our factories started. Within close to 6 days of closure, we were back to production, all thanks to the equity we had established over the years with local authorities. Everyone was forthcoming to support us in the endeavour that we had taken upon ourselves. We ensured people safety during the production cycles. We needed to make sure that supplies don't stop because food is the most important and the most basic necessity during these times. When we restarted the plant, we didn't know what to produce because the supply lines were disrupted. We couldn't even gauge the market demand dynamics. We activated all channels of retail to reach our consumers from delivering directly to consumers to putting up mobile vans in residential townships or tying up with last mile delivery aggregators, etc., driven by a common purpose of keeping food supply lines running for our consumers, the team exceeded all expectations. While it was a challenge of a different magnitude, it brought with itself crucial learnings that will stay with us forever.
You have built two immensely successful businesses, Kohinoor Ready to Eat Foods (later acquired by McCormick, US) and Del Monte in India. How challenging was it then and how do you see the scenario shaping up now?
Starting up any business from scratch is never easy. There will always be battles to fight on a daily basis. Yes, the landscape has changed tremendously. When we started Kohinoor, it was an export-oriented business. We learnt about the product category and brought in technology to facilitate the business. We were one of the fastest and the first ones to set up a state-of-the-art manufacturing plant, which was way ahead of its time in India. That allowed us to export to retailers & food brands to developed markets, countries that India traditionally never exported value added products to. That's how we became the poster boys of the ready-to-eat industry. Looking at the impressive growth, the business was acquired by McCormick at a meaningful & impressive valuation.
Today, while food is a far more mature category, consumers are far more accessible & receptive to trying newer brands & products. The emergence of social media, D2C channels has further boosted the exposure of brands to Indian consumers. Such platforms are the great mediums for new brands to engage with their target audience, which was never the case earlier. Even when we started Del Monte, we used to struggle to have proper distribution channels. We had to build everything from scratch.
Today the competition is much more, whereas a decade back, there used to be only a handful of brands. Now-a-days brands need to create their relevance in the market. They need to create that affection & stickiness for the brands with the consumers. I believe the problem statement remains the same. From a stakeholder's perspective, we are far more progressive, today. Government has become supportive to the startups and organised sector, the recent structural changes, such as GST or PLI, have been the proof of the same. There are lot of positives that we can draw from the fact that it's a highly conducive environment for the startups today supply chain network, the desired infrastructure, social commerce, a transformative manufacturing landscape, business friendly policies and to top it all, a great consumer appetite to try newer products & experiences. Challenges will always be there from an operational point of view, but I truly believe in the Indian growth story, and that new age startups have much more to gain and serve the incredible Indian consumers.
The post-pandemic era is starkly different that the pre-pandemic one. Has it been an easy way up for the budding entrepreneurs or is the road to growth getting tougher?
There are always two sides to the coin. The funding boom that we witnessed in the last couples of years has already started to cool down. The reality is striking home and the valuations are moderating. At the same time, the pandemic has brought with it different changes as far as consumer consumption dynamics are concerned. Today health & wellness and food safety have become the top priority of people. Consumers have become more conscious about their choices, which is ultimately pushing brands and organisations to move up the health curve. The governing bodies, such as FSSAI are playing a crucial role in this.
While online retail is coming down from its peak, its penetration has increased tremendously. The brick & mortar stores have started doing well as we are accepting and adapting the New Normal. The hybrid model of online & offline shopping is functioning seamlessly and has been reflecting great growth curve for all the companies. It's a great space and time to venture into the entrepreneurial journey. Food is a mature category, which is pivoting and adapting the New Normal exceptionally well. Companies that go with the flow will always be in a much better space to survive and succeed in tougher times. As long as organisations are able to bring the differential aspect and the relevance in their offerings and are able to articulate their story in an effective manner, they will stay in the game.
What's your plan of action with Uttishta Partners? What's your long term strategy?
Through Uttishta Partners, we are bringing in global brands to India through joint ventures. Given our experience of establishing consumer businesses & brands in India, me and few of my former colleagues have launched this venture.
Through this, we intend to create a platform that will allow international brands to come to India and also enable promising domestic food brands to scale up. We are providing the necessary infrastructure, right from supply chain to marketing to go-to-market strategy, distribution infrastructure using advanced technology. Our vision for Uttishta is to be the most accessible and adaptable platform for brands to leverage the burgeoning food retail landscape.
Our vision matches and reflects the India consumption story. With the growing income prosperity, India is one of the fastest growing markets globally. We believe there are still many white spaces that brands can explore to expand & grow their business. We want these incredible food retail brands to make the most of these shifting sands of time through Uttishta Partners.
You are on the advisory board of SupplyNote. Kindly share with us the potential you see in this fast-growing supply chain automation space? What are the USPs that made you be a part of this innovative startup?
I think food supply chain automation is a very interesting subject, which is still at an infancy in India. For restaurants, cloud kitchens and other F&B businesses, a lot of cost solely goes into warehousing, inventory management and other infrastructural requirements. SupplyNote, a cloud based SAAS platform operating in the F&B domain, provides full stack supply chain management services including warehousing and eCommerce so that their clients can focus on the core business strategies. It provides a cloud-based procurement management suite with integrated e-commerce for restaurants, thus providing a precise solution that benefits the F&B industry to save up to 8-10% of the running cost. Additionally, it will be a great leveler for small restaurants who don't have financial muscle for better sourcing.
SupplyNote has been working relentlessly towards reinventing the way F&B outlets work in India and has exhibited tremendous growth so far. The brand has already grown over 3.5x by GTV in the last one year. Its technology has already benefitted over 5000 F&B businesses including buyers and suppliers. I am excited to work with a group of passionate young minds in revolutionising the F&B supply chain with my experience. The company envisions to become the backbone of the F&B supply chain by evolving into the one-stop solution for all supply chain needs- inventory, POS, and marketplace and this is precisely what brings us in sync to work forward and bridge the gap.
We would like to get insights from you on the roadmap to grow the Indian Food Processing sector 10x in the next five years as you have been nominated to the Food Processing Task Force set up under the aegis of SCALE (Steering Committee for Advancing Local-value add and Exports).
There is a greater need for exploring innovative ways to increase Local Value Add in critical sectors of Manufacturing amidst existing disruptions in the worldwide value chain. This will enhance the presence of India in emerging global value chains. The SCALE Committee is formed by the Ministry of Commerce and Industry has been working closely with the Department for Promotion of Industry and Internal Trade (DPIIT), under the guidance of the ministry.
The entire premise of this is to boost competitiveness of the industry. Through this initiative, the intent is to enhance the ability of Indian companies to be competitive in the exports market. As I have mentioned earlier as well, the PLI scheme has been playing an enabling role in this regard. Indian food processing industry has been lagging in adopting advanced technologies.
I believe with changing consumer dynamics and more premiumization, increased awareness on food safety & hygiene, a shift to organised trade from the consumers' as well as the regulators' perspective, the food industry is going through a shift of formalization. This will result in food industry moving up the value curve. Scheme such as PLI will aid in private capital formation, which will attract new technology, which will also allow Indian companies to participate in value-added food products both in the domestic and global markets. This will also enhance farmers' income and ensure the sustainability of raw materials supply directly to food producers and processors. A lot of work is happening on the supply side from an enabling environment and infrastructure development point of view. Similarly, on the demand side, we are working towards positioning Indian food products as a credible and reliable supplier in the global value chain. SCALE is envisioned to enhance our food processing industs brand equity among the global counterparts.
Do you see any lacuna in the current academia? How can the corporates bridge this gap?
There is no dearth of talent in India, what we need is a greater collaboration between industry and the academia. The more we work on bridging that gap, the more the academia works closely with the industry issues, the more the industry engages with the academia, it' s a circle of life. I am happy to see increased activity happening on this front. While the developed markets are far more advanced in building and sustaining such collaboration, we have taken that first step and things will only move up from hereon. There is greater emphasis on skill development. Premier institutes are doing a wonderful job in terms of industry outreach and offering a promising launch pad to the young Indian talent. Incubation centers in association with NITI Aayog are being launched at various B-schools. It gives me great confidence that with the increased participation of all the stakeholders, things are only going to get better.
What's your take on the policy interventions for scaling startup ecosystem in the country? What's the ground reality and what's your suggestion to the government authority to make it even more seamless?
Being a part of the startup ecosystem, I can confidently vouch for the fact that there is plenty of support from all the stakeholders involved. This ecosystem will only blossom going forward.
Up, Close & Personal
What are the criteria or the skillsets that you look for in startups before investing?
Passion, conviction and the uniqueness of the idea and quality of founders are the factors that must appeal me to invest in futuristic brands. There needs to be a merit in the idea. Idea needs to create a positive unit economics in the future. It needs to be a sustainable and profitable business. I believe in solving the never-heard-before problem statement through such future-forward brands. Most importantly, founders need to be driven by the ideas they present to us. While we will find many startups buzzing with idea, it is the Discipline that needs to be nurtured if they want to fructify their vision. They need to have Resilience if things don't work as planned. In short, their mindset needs to be strong.
One success mantra that you would like to share with supply chain leaders of tomorrow.
Supply chain is an integral part of the value chain of any business and should not be seen as a silo. Supply chain leaders are true business leaders in their own ways. With the kind of uncertain environment that we live in at both the macro and micro level, supply chain leaders will need to wear many hats to manoeuvre their businesses through these tough times.
What are the steps of creating a unique game changing brand and who better than you can decipher on them as we all know the success story of Kohinoor and Del Monte in India?
I believe there is no secret sauce to success. All brands that make it big are brands that stay relevant to the consumers' needs. As long as companies are solving problems in a manner that consumers are looking for, they will stay in the game and rule the market. Brands need to build trust among its consumers and trust is an outcome of consistently delivering on set expectations, at the same time, brands need to stay relevant to changing times by bringing about changes to their products & processes. Brands that consistently deliver and exceed the expectations of their consumers, are the ones that survive and sustain in the long run.