“At ITC Master Chef, we want to make the freezer the new home pantry”: Ashu Phakey of ITC

Vice President and Business Leader ITC Limited (Frozen Foods) talks about Master Chef’s partnership with ice cream brand Havmor for its network of carts.

Ting! Ting! Ting! The ringing of a bell made us jump to our feet and rush out of the house towards the road. The bell would invite us to a soothing and joyful experience enjoying a cold ice cream on a hot afternoon. In recent years, these bells have become rare on ice cream carts. But now people in Delhi and the NCR are hearing those welcoming sounds again – although coming from the same ice cream carts, they are now selling frozen food.

ITC Master Chef Frozen Snacks, in partnership with Havmor Ice cream, uses its distribution network of ice cream carts to make its easy-to-cook snacks more readily available. As part of ITC’s new route-to-market distribution strategy, it allows ITC Master Chef to leverage 100 Havmor ice cream carts during the winter season, which is the peak season for frozen snacks and usually off season for ice cream in Delhi. markets. From November to March, the frozen food industry sees a 30% increase in sales compared to the summer months, as people in cold regions prefer to eat hot snacks at home.

Ashu Phakey, Vice President and Business Leader ITC Limited (Frozen Foods), says this partnership will help ITC add more touch points for distribution. It creates additional capacity, helps increase frequency and also allows ITC Master Chef to display its full product line.

“This is a unique initiative and a first in the industry. Never before has a cross-industry partnership like this happened in this category,” he said.

The size of the frozen food category in India is around Rs 2,400 crore with about half of the market in the hotel, restaurant and cafe (HORECA) channel and the balance in the retail segment. Despite the convenience, taste and nutrition offered by these foods, the category is not very large compared to other competitive segments in India. This is a large segment in Southeast Asia, but India’s per capita freezer penetration is much lower than countries like Sri Lanka and Thailand, which have shifted heavily to frozen foods.

Apart from the myths people have about frozen foods and the fact that there is a lot of help in Indian homes to make fresh foods, Phakey also attributes this lack of growth to less product portfolio diversification, as until recently, it was largely about potatoes – be it French fries, Smileys or potato bites. This limited it to being an occasional tiffin snack for children. Master Chef solved the problem by diversifying the portfolio with a wider variety of products and going beyond mealtime snacks.

However, another challenge remains. That of the limited freezer storage space.

“Let’s say India has 1.5 million outlets. Of this number, only 10% or less have freezers. And these freezers need to hold multiple categories: frozen peas, ice cream, ice cubes, and the whole range of frozen snacks. Also, it’s the only storage unit, which means all the stock has to go in that freezer unit and it can’t keep extra stock hidden like they do with other products,” he said. -he declares.

A similar challenge is faced at home. The freezer is stocked with everything from frozen vegetables, desserts and even masalas! “Furthermore, the frequency of opening the freezer is about two to three times a week, while for the refrigerator it is about three to five times a day. This limits the frequency of consumption.

Phakey says the challenges in this category are very different and must be solved for it to explode. The partnership with Havmor is a step in this direction.

“I can’t increase freezer space, but I can create more touch points. So if the consumer sees my product more frequently or can order it more frequently, they will prefer it. At ITC Master Chef, we want to make the freezer the new home pantry. It used to be the cupboard that held all the snacks like noodles and cookies. But now it’s the freezer. It has everything from nuggets to burger patties, light food to heavy food – it’s all there,” he added.

To help increase frequency, the cart vendor rings the cart bell and calls out products like a traditional vendor. “Fries the lo. Tikki le lo. Although the ITC found this a bit strange at first, it trained sellers to wave to consumers.

“Ice cream is a bit of a passive sell because the consumer approaches the cart themselves. For frozen snacks, we tried to make it a bit more active. Unlike an ice cream guy, he has a bells and he calls. So we trained them and my team trained with them to make them more comfortable,” he said.

To counter the problem of limited space in the stores, these carts help her to display her full range of products. “Stores don’t have space to display more than 15 to 20 products. But these carts are my stores and can provide great visibility,” he said.

However, the carts only sell vegetarian snacks. “One of the challenges with ice cream is that it is a vegetarian product. So Havmor was a bit concerned about the FSSAI rules. So when consumers come to the basket, we show them the range in the freezer, but we also inform them that we have a non-vegetarian range. We have kept a barcode scanner on the cart which takes them to the online store where they can buy the non-vegetarian range,” he said.

Consumers who buy from the shopping cart receive coupons that can be redeemed on itcstore.in, the company’s D2C platform. This drives traffic to the shopping cart and online store.

Thanks to this initiative, Master Chef not only stimulates sales, but also enables trials. Since the brand arrived at their doorstep, there is more awareness. But what happens during the summer season?

“After March, three things could happen. First, we could continue this in a different format with Havmor, like having carts that carry both frozen food and ice cream. Second, some of them can be replaced with exclusive ITC carts. And the third is that many consumers who have tried our products may have gone to our online store and would buy there,” Phakey said.

Master Chef chose to partner with Havmor for its good presence in Delhi. “In terms of numbers, the availability of the infrastructure is very good, both the distribution network and the trolleys. Like us, it’s also quite an experimental and experiential brand. It helps when two partners work together,” he said.

Although ITC uses Havmor’s infrastructure, it also offers certain advantages to the ice cream brand. For Havmor Ice cream, owned by Lotte Group, a South Korean conglomerate, the partnership ensures that its salespeople also remain employed during the offseason. These vendors usually return home to their villages during this time and have no income. “We saw this as an opportunity to provide paid employment throughout the year,” Phakey said.

The distributor also earns through frozen snack revenue, when ice cream sales drop. In addition, the trucks remain operational, which saves on maintenance expenses.

“This is a win-win initiative for both the companies and its distribution partners. It helps Havmor Ice Cream Channel Partners generate additional revenue during the winter months. Expanding forklift operations is an integral part of our strategy to increase reach. As India’s frozen food supply chain evolves, leveraging the existing ecosystem to expand reach at an optimized cost will remain a priority area,” said Vincent Noronha, Vice President of Marketing at Havmor Ice Cream.

Besides this partnership, the other market access distribution strategy for ITC Master Chef is to leverage e-commerce – both its own D2C platform and other platforms.

It also offers custom products through the cloud kitchen model in Bengaluru called ITC Master Chef Creations. Using its range of products from Master Chef and ITC’s other Kitchens of India brand, it offers dishes like Dal Makhni, rice bowls, wraps, burgers and more. It’s like a restaurant menu that can be ordered through Zomato or Swiggy.

“The dishes are made and delivered. Generally, the brand reaches consumers through the packaged form and they manufacture it. Here it comes in the made form. So consumers can make it themselves or order it from here. Currently we have around eight stations in Bengaluru as a pilot and we are leveraging them to bring our consumers to sample our range of products,” he said.

As HORECA represents an important part of Master Chef’s activity, the third wave of the Covid19 pandemic in India has impacted it. Capacity restrictions, weekend and overnight curfews in different parts of the country have weighed on the restaurant industry. Master Chef addresses this impact by raising awareness among its partners and strengthening distribution networks.

“Since home delivery has increased, we educate our partners on which products will be a perfect fit for the service. For example, if someone ordered a burger and it takes 30 minutes to deliver, they should always have the even bite and not get soggy, so we’re educating them on how much sauces to use, and we’re also trying to create more products to use in that segment,” he said.

Despite lockdowns and distributors not holding up well due to the Coronavirus, Master Chef is working hard to maintain distribution. To this end, it has linked all of its partners to multiple distributors. So if Distributor A isn’t doing well, the restaurant can contact Distributor B. “Normally the areas are marked off, but we’ve made it more connected,” he said.

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