ITC reworking strategies for `Kitchens of India' products

To target mainstream consumers in Western markets

ITC Ltd, which forayed into the branded & packaged foods business a little over five years ago through launch of its `Kitchens of India' brand, is now re-working strategies to go after the mainstream consumers in the mature markets of the US, the UK and Canada.

In order to assure global consumers of the highest standards of food safety and hygiene, the company is now actively engaged in assisting its outsourced manufacturers in implementing world-class hygiene standards through HACCP (Hazard Analysis and Critical Control Points) Certification.

Talking to Business Line here recently, Mr Ravi Naware, CEO of the Foods Division, said exports of the ready-to-eat items were now picking up, "and we feel it is time we graduated from the exotic ethnic foods category (aimed mainly at the Indian diaspora) to mainstream foods, considering that volumes too are now on the upswing".

The Kitchens of India range now covers as many as 25 products.

Mr Naware said volumes were getting better in the western markets, and innovative promos such as enclosing `free' Indian classical music CDs with the ready-to-eat packets (done between March and July this year in the US) have proved highly successful. "This has encouraged us to target the mainstream consumers now."

He said ITC's aim was be present in every exclusive food store of the US (there are said to be some 6,000 such now) in the next three years.

Focus on packaging

Citing consistent quality besides total compliance with local food laws as the prime requisite for such international market bonding, Mr Naware said special focus now was on new packaging and compliance with international labelling laws. ITC's Kitchens of India products already enjoy the Kosher Certification, accorded to quality food products.

Pointing out that leadership in the branded and packaged foods business warranted a complete understanding of the supply chain logistics for agri produce, he said the company's main strength was its close business ties with the farming community. And "this in turn has helped us to sustain the quality standards in the foods business".

Mr Naware said several new and innovative products in the foods business, covering the four broad market categories of ready-to-eat foods, staples (atta), spices, confectionery and snack foods (brand categories are Kitchens of India, Aashirvad, Sunfeast, Mint-O and Candyman), were in advanced stages of development at ITC's product development facility in Bangalore.

On the domestic front, in biscuits, he said in the last one year or so, all key ingredients like wheat, sugar and edible oils have witnessed sharp price increases (on average, around 20 per cent plus), squeezing the margins for all manufacturers substantially.

Mr Naware said it was also quite difficult to understand how a common man's snack food item such as biscuit can attract the highest VAT slab of 12.5 per cent.