Food-tech has graduated from being a ‘buzzword’ last year to part of our daily vocabulary when talking of modern businesses and growing categories. Todays customers are more discerning than ever before, and convenience is their demand. They juggle between hectic work schedules and personal lives yet demand the best of quality, hygiene and instant satiation. It would be safe to say that consumers' spending trends reflect their willingness to pay for innovation & convenience and this is not restricted to an urban phenomena. The growth in Tier 2 and 3 cities have been faster and the graph is only poised to grow further. That’s all possible because of the coming together of food technology, logistics and thought leadership. Bakers Circle is one such company that has been quietly innovating at their end. Recent developments have allowed them to leap frog ahead while they service this customer via their many partners and clients like Starbucks, Ikea, Mc Donald’s, ITC, Subway and more.
Bakers Circle raised early funding from GIA, a private equity fund, in 2006. In 2015, Gaja Capital ploughed in another round of capital to allow Bakers Circle to take the next technological leap in its evolution towards a better, cleaner and more efficient product. Subsequent expansion continues to be funded through internal accruals.
Food Tech: the Future of Food
The emergence of new technologies, greater internet penetration into tier 2 and 3 markets, and mobile app-based services have completely transformed today's food industry. Automation is increasingly becoming the new norm in the food industry requiring substantial capital expenditure. With the diverse and complicated requirements of India which are like no other geography, the concern isn’t if they should automate but WHEN. Since the future of food is already here—it’s time to decide how to meet the growing consumer demands for freshness, convenience and environmental sustainability? In short, when to disrupt?
The ‘New Normal’ is ‘Disruption’ Itself
Disruptive business model = successful organisations, addressing unmet needs. Bakers Circle is one such food revolution, available in every bite of QSRs, cloud kitchens, and fast food chains. This very first B2B entrant in the bakery food-tech space in India is purely automation, tech & logistical driven and is the source behind the success of many big brands in this space.
Changing Landscape: The State of Food Industry
Traditionally, the food industry in India was slow in adopting technology solutions. However, the onset of the pandemic has notably hastened and forced the food industry to look beyond the conventional. Consumer needs are changing, the supply chain is evolving, food service channels are increasing, and technology demands information, convenience & service at the speed of light.
If one were to look at present-day predictions:
• By FY 2022, India's online food market is expected to become an $8 billion market—growing at a 25-30% CAGR.
• By FY 2030, it’s expected to be the third-largest consumer market.
• QSR alone is estimated to reach INR ~800 billion by FY 2025.
• Another category that received a shot in the arm—Cloud Kitchens.
• According to market research, by FY 2024, cloud kitchens are expected to reach a USD 2 billion industry in India.
Both cloud kitchens and QSRs are witnessing exponential growth—and also seeing soaring investor interest. This begs the question of not if, but when the imminent and ireversiable trend of growing interest and investment in pioneers of manufactring that make up the valuable backbone to this ever growing industry will breed the next Unicorns. The auto OEM and component industry saw huge inflows of capital and consolidation over the past 15 years, the time has come for the same in this valuable and growing industry.
Food Tech: Soaring in Popularity, Growth, and Investment
In the recent past, food tech has shown remarkable adaptability in unforeseen and challenging circumstances.
• For the 5th consecutive year, Starbucks is still the world’s most valuable restaurant brand, with a brand value of US$ 38.4 billion.
• Rebel Foods, a cloud kitchen startup, is the latest Indian startup to attain unicorn status, with a billion-dollar valuation at $1.4 billion in a $175 million fundraise.
• A Swiss-based private investment firm Lurra Capital invested $10 million in a strategic investment of the food tech platform—C3.
• With overall funding of USD 34.89 billion in 2.7K+ enterprises, food tech is one of the most active sectors for investors.
• From FY 2019 to FY 2020, the food-tech ecosystem has raised more than one-third of the total funding in India.
• Swiggy, Deliveroo, Zomato and Glovo—the top 4 food tech unicorns, with more than a billion-dollar mark valuation were the buzzwords during the pandemic.
Summing up, the food tech industry is evolving every day into a formidable cog in the countries economy. Every day a new QSR, cloud kitchen, or food tech firm is gaining traction and turning into a unicorn or decacorn. Venture capital firms like ah! Ventures, Lightbox, Accel Partners, and InnoVen Capital are critical forces. Apart from proper funding, VCs assist in connection establishment, growth, technical assistance and much more.
Bakers Circle, India’s foremost B2B food technology company, is a vital part of this growing ecosystem and one of the premier names in the food processing industry that is witnessing similar momentum in the business and investor interest. Infact, in terms of product innovation, Bakers Circle has directly been responsible for the growth of food solutions for many such foodtech, QSR, & cloud kitchens in India.
Bakers Circle: One-Stop-Shop Market for Restaurants, Bakeshops, and Businesses
Bakers Circle is a unique amalgam of scrumptious ready-to-use bakery delicacies and excellent logistical and technological machinery. Their product concept as well as quality, hygiene, and customisation are their key differentiators, that have kept competitors at bay and allow them to command a formidable lead in the industry in this Niche but growing segment.
Dev Lall, its founding CEO, propelled this unique venture two decades earlier in a 500 sq. yard property in Gurgaon. Today it boasts a 3 Acre facilty with a 40,000 sq foot shop floor and a delivery radius of 5,000 km. Thanks to its home-grown technology, Bakers Circle today ships 84 SKU's to over 5,000 odd locations in India, the Middle East, Africa, and Sri Lanka. It generates a rated output of 1,250 tons per month.
Evolving Clientele and Product Portfolio
Bakers Circle has a significant market share in the world. Stalwarts, cloud kitchens, and popular QSR brands, such as Subway, ITC, Starbucks, IKEA, and Rebel Foods, are renowned customers. Bakers Circle adds flavour to a range of mouth-watering foods—sandwiches, cheesecakes, pizzas, burgers, cookies, brownies, muffins, dessert cups, baguettes, buns, cookies, and puffs, to croissants. They are in brief the fresh warm and inviting smell of a morning bakery.
This prolific output is a result of sustained efforts of over eighteen years of a strong team of food scientists, international chefs, R & D experts empowered to challenge every obstacale and challenge thrown at them The growth of the baked goods segments and surging demand in India encouraged Bakers Circle to create new products, and enable green & technology initiatives. Fresh expansion is underway where an additional 60,000 square feet spread over 3 Acres is underway. This will not only triple output capacity to meet the demands of a very dynamic and well educated market, but also use tech initiatives such as Solar power, Automated guided vehicles and Green technologies of Nitrogen freezing and cleaner gases.
What Makes Bakers Circle Unique?
Indeed taste and quality are two significant differentiators, but technology is their backbone. Other key USPs the company continues to reign in include:
• Global reflection of food best practices to India
• Unique equipment configuration meant to customize at scale
• Supply chain solutions and packaging equipment that ensure logistics quality of food - Cloud-enabled bar code system, Cutting-edge freezing technology, Real-time product tracking, a fully GPS tracked supply chain
• Extending their reach of their enterprise software to ensure GMP and efficienies are leveraged to the maximum
• Greener and cleaner technologies in the production and processes
All these best practices ensure more bang for its bucks with minimal or negligible wastage.
The Future Plan
Bakers Circle is an evolving venture that is well-versed with the Indian marketplace. The company is empowered to ideate & develop the most radical thought process. The immediate plan is to "Grow, Grow, and Grow." Over the next few years, the company plans to reinvest a substantial amount of its internal accruals in greenfield technology upgrades and offerings. They continually invest in new technology and solutions to be future ready. The time has come for the Indian food eco system to take a Giant leap and put itself on par with global best practices and standards. It is a slow trudge with very long gestation periods but mature companies like Bakers Circle are well poised to be leaders and pioneers in this.
While the world was fighting with shockwaves of COVID-19, Bakers Circle was continuously thriving. They brainstormed with major cloud kitchen operators and QSR’s to develop a scalable solution line, ensuring rapid turnaround time. Thanks to their passionate team, and a zeal to do business differently, and robust system, Bakers Circle is part of the backbone of the Foodicorns in India.
Mr. Lall's aim is to auto-pilot tech-related advancements and boost human and customer interface. His goal is to deliver the right product to the right person at the right time. To address this and meet the custom needs of a country, Bakers Circle has also partnered with global vendors for raw materials as well as equipment and process development.
Thanks to the pandemic, the food industry has leaped forward by a decade, and there isn't any turning back. Companies focusing on this are availing benefits and reporting higher numbers than before, and Bakers Circle is a testament to this.
Brand Solutions is a marketing initiative for sponsored posts. No VCCircle journalist was involved in the creation of this content.
