‘Our food business will soon overtake our fashion segment’

Kishore Biyani, CEO, Future Group, has moved one step closer to his aspiration to take his company to being one of India’s largest food FMCG companies, with the partially operational 110-acre India Food Park in Tumkur near Bangalore, which will be inaugurated on Wednesday morning by the Prime Minister.

Envisaged as a chain that will take food from the farm to fork, the Food Park will serve as the back-end rasoi (kitchen) for Biyani’s food business which is expected to deliver an overall 13-15 per cent savings in supply chain costs.

The Food Park has two functional lines – one wet line for fruits and vegetables and a dry line for as rice, wheat, ragi etc and cold storage facilities. To begin with, fruit ripening/pulping operations, an IQF (independent quick freeze) line for freezing fruits and vegetables, and a line for grading-sorting-cleaning-chopping vegetables are ready.

“The Food Park marks our entry into the food FMCG space. We will become one of the largest food FMCG companies in the country across categories such as fruit juices, ready-to-eat frozen foods, chocolates, pasta, and so on, unlike some others that are limited to a few product categories” said Biyani.

“To grow our food business, we needed backend rasoi that can provide what people of the country want, for instance, pani puri that has a shelf life of six months; because the food that multinationals are selling in the country do not cater to Indian food sensibilities,” he explained.

Stating that the Food Parks will be a game changer that will transform his food business, Biyani said: “By 2018-2019, 70 per cent of the food in our network of retail outlets will be our own brands and our estimated revenues from our food business is ₹20,000 crore by 2019. Our food business is all set to become bigger than our fashion business in the future.”

Biyani already has a strong retail footprint for his food business with over 720 stores across the country, including Big Bazaar, Food Bazaar, KB’s Fair Price, Big Apple, Foodhall and Aadhaar.

“Food consumption accounts for 35-40 per cent of the country’s GDP at $600 billion today of which, 3-4 per cent is processed foods. Demand for processed and frozen foods in our stores has grown 100 per cent y-o-y, ” he pointed out.

An initiative of the Integrated Food Park Ltd, a company that the Future Group has floated as the food manufacturing arm of Future Consumer Enterprises Ltd, the India Food Park has been established with a total investment of ₹1,000 crore.

“We have signed up 65 acres of land in Kharagpur, West Bengal for our next Food Park and are looking to acquire 100 acres of land in Madhya Pradesh which should come through in the next 12 days” said Biyani.

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