Central Poultry Development Organization & Training Institute under Government of India, Ministry of Fisheries, Animal Husbandry & Dairying, a premier Institute located at Hessarghatta, Bengaluru organized a First Online Round Table of startups in poultry sector on 10th February, 2022.
Poultry sector in India is a techno-commercial sector with contribution of nearly 1.5 lakh crores to the GNP with about 6 million people being employed directly or indirectly. Poultry Farming Practices in India are one of the best in the world. The Science adopted in Genetics, Nutrition, Management and Disease prevention are one among the best in class matching Global Standards. Presently it is estimated that 5 billion broiler population, 250 – 300 million layers and about 4.5 to 5.0 crore broiler breeders are being reared in India. This has established Indian Poultry Sector as one of the best farming activity at a global scale with highly efficient production systems in place. However, poultry products namely egg and meat are being traded as commodities in the traditional market system. The new age companies are entering into poultry sector by adopting technology expertise of brand building and consumer focus approach in re-defining marketing of poultry products.
This event is organized to showcase such startup leaders including Unicorn (valuation of l billion USD) and Soonicorns in the sector. The founders invited for the online round table are, Mr. Abhay Hanjura – Licious (Unicorn of 2021), Mr. Shan Kadavil – Fresh to Home, Mr. Narendra Pasuparthy – Nandus, Mr. Vignesh Soundararajan/Mr. Krishna Prasad – Delfrez (Suguna Foods), Mr. Nishanth Chandran – Tendercuts, Dr. Sanjoy Kumar Das & Mr. Sushil Kanujolu – Fipola, Mr. Abhishek Negi – Eggoz, Mr. Mahesha – My Chicken & More, Mr. Harsha – The Meat Factory.
The Online Roundtable started sharp at 10.30 am on 10th February, 2022 by opening remarks from Dr. Mahesh P.S., Joint Commissioner & Director, CPDO&TI. In his opening remarks, he acknowledged the achievements of startup ecosystem in India touching 88 Unicorns as on date with addition of 44 in the year 2021 and 8 unicorns in just six weeks of 2022.This startup revolution is recognized at the highest level including Hon’ble President speech at joint session of Parliament, recent speeches of Hon’ble Prime Minister and Finance Minister emphasizing the role of startups to grow and achieve the status of Unicorns, Decacorns and to transform into multinational companies from India.
Further he elaborated that digitalization, consumerism, focus on safe food and health would create more demand for protein foods like eggs and chicken in India with a priority preference for safe and certified traceable products. Hence he advised to adopt latest technologies like Block Chain, Artificial Intelligence and Data Mining to capture a pie in the digital India.
The startup leaders were posed three questions in the interactive session of the roundtable namely 1. Their startup story, 2. Uniqueness of their business model with message for the budding entrepreneurs, 3. Expectation from the poultry sector or producers of poultry products.
Dr. Mahesh presented Mr. Abhay Hanjura the leader of the group in establishing first Unicorn in D2C(Direct to Consumer) brand in India during the year 2021and congratulated his co-founder Mr. Vivek also for achieving such a great milestone in Food Sector.
Mr. Abhay Hanjura humbly replied that the status of unicorn is more of a noise than any great achievement from their prospective. He said that this is a collective effort of all present in this round table in achieving recognition from the consumer. He mentioned that a single player cannot change the ecosystem for transforming animal protein consumption in India. He and Vivek started with the excitement to develop a startup similar to “Amul” in Dairy. He mentioned that opportunities are immense in the order of magnitude and depth and said “We can get tired but opportunities never get tired”.
To the question of uniqueness of their business model, Abhay made a statement “Idea ka value nahin hotahai” unless consumer has to believe the execution of the claim. Execution is the key variable reflecting the success of organization which inturn drives repeat customers. Licious started in 2015 in just under 15 cities covered to have 2 million customers with a revenue of 1000 crore per year of which 7 cities are just added in the last year. The key message he said is brand development in this category is not a “Spray and Pray” business but needs depth, quality and execution. His message for the budding entrepreneur is “Someone need to find fun in enjoying boring execution on a consistent rate”.
His expectation from the poultry sector is to recognize that “We are not competing each other but trying to organize 95% of the unorganized sector in a better way to derive value for both producers and consumers. The questions posed by the investors for both Abhay and Vivek were “What are you trying to do in this category, this will never work”, “ India will not accept this as a separate category” they proved their assumptions wrong and said, “ Our time has come and our time is now”. Abhay assured that “Consumerisation by collective efforts of all stakeholders can create more startups and the pie will expand very fast in India.
The second founder is Mr.Shan Kadavil – Fresh to Home. In his reply acknowledged efforts of Licious and other players in creating ideal ecosystem for startups in India under this category. He also faced the same question by investors that “Do you have enough depth to create a separate vertical of B2C brand in conjuncture with the likes of grocery brands like Big Basket etc. all over the world there is no separate fish and meat category brand recognized till date. However Shan believed in Indian food habits which are very different than the rest. It is indicated by their success to create as a separate Brand so that people have recognized the likes of Licious, Freshto home, Tendercuts, Fipola as separate brands for Meat category.
He thanked poultry sector having enabled the ecosystem with their hardwork with 50 years of expertise in developing efficient production system of global standards in India. Mr. Shan is a serial entrepreneur from 2015, created two companies and exited with so so success. However, he became the CEO of Zinga India, a multibillion dollar gaming company. Here, he had contacted Mr. Mathew who developed “Sea to Home.com” a traditional fish exporter from Cochin. Shan developed interest and has to search Mathew to get great quality fish in India. Shan convinced Mathew to meet his gap of scalability from financial standpoint and technology stand point to start a new stratup “Fresh to Home” in 2016.
Fresh to Home today are operating both in India and UAE going close to 1000 crore revenue per year handling 30,000 tons of meat every year with 2 million customers and about 1.5 million orders per month. In his message to the upcoming startups that the need of looking business with “New set of eyes, expertise, technology, differentiated product, find the unmet need”. He said that “Me too products” are hard to survive unless they have a value for consumer.
Shan told that this category is fast growing in tier I cities with around 20 billion dollar market and overall 50 billion market in India. Dr. Mahesh asked the question of when will you stop burning or losing money, he replied that it’s a social service by the beginners in the category like Abhay of Licious and Shan to create a consumer brand which requires huge capital investment by way of marketing and brand building. Further he said that their startup is Ebita profitable in Delhi and Bangalore and yet to reach the revenue threshold in the newer cities which will definitely stand in some time to come.
Next in the lineup in the round table was Mr. Narendra Pasuparthy, producer cum startup from Nandus who said that “We being producers endup in a local broken supply chain not getting my price for my product. He got inspired by Madam Anuradha Desai’s words to start retailing and to build a brand is essential for getting the price for the product. After returning from US, Naren started this new venture to create a consumer brand which is “Hyper local and Omnichannel”. Presently Nandus is operating 55 outlets in Hyderabad and Bangalore. He acknowledged the vision of Sri. Kishore Hegde, who has put meat retailing on the map of India with a new outlook of shops way back in 15 to 18 years ago.
In his message to the upcoming startups “Go out and build a brand – Don’t be afraid”. When he came back, he tookup a second hand processing plant, setup biogas, solar and automation units in poultry production, many felt that he is stuck. He was disgusted for not getting the rate for his product inspite of hard work as an efficient producer. Then he decided to go out to develop a consumer brand by adopting professionalism by inducting experts, technology etc. His message is simple and clear “Let go the Control, delegate and facilitate to develop a scalable organization”.
Mr. Nishant Chandran, an Engineer graduated out of Bangalore being native of Chennai appreciated the efforts of CPDO&TI in creating such a platform for all the startup founders to meet online on a single platform. He said that this is the best time to transform as India’s macro parameters are highly positive with a growth of 8 – 10 % GDP per year which enables lot of dispensable income in the hands of the consumer. Further he said that consumer spends dispensable income first on food followed by clothes, lifestyle, investment, real estate, cars etc in the order of priority. Among the food, the choice is always meat being the country of 70 to 80% non-vegetarians. He voted for chicken as a priority meat from which more than 100 different dishes are being made and consumers never get bored eating chicken.
Nishant Chandran as a technocrat started a digital payment company and sold to Paris based entrepreneur during which time he used to travel every week to Paris up and down there he got exposed to meat market shops presenting clean and choice of meat. Back in India he mentioned that consumer has only two choices “Small piece or Large piece” and recognized lack of awareness, assortment, grading etc in this category.
“Once an entrepreneur is always an entrepreneur” – This proved right for Nishant to start Tendercuts to solve the greater problem of front end to create a consumer brand in this category. Presently Tendercuts is an online driven retail model with market leadership in Chennai and Hyderabad and just entered Bangalore. His philosophy is to transform the purchase experience at shops and to convert butchers into meat experts.
In his reply why they started stores first, he said that the opportunity he got in the beginning accidentally was a retail store with 1200 sqft format in which they created 1/3 as front area and 2/3 as storage/processing area. They adopted a distribution model wherein each outlet is like a factory outlet and meat is cut on the order by the consumer over the central model wherein it requires huge capex investment for distribution.
Mr. Vignesh Soundararajan, Son of Mr. Soundararajan, Chairman and Managing Director, Suguna Foods has established a parent endorsed brand “Delfrez” in this category during last quarter of 2021. Representing delfrez,
Sri. Krishna Prasad, Vice President Suguna Foods mentioned that Suguna being expert producer and processor wanted to expand as a consumer facing brand in the new ecosystem. Eventhough Suguna is having a revenue of more than 10,000 crores per year. And in his words “Just counting money and losing heavily” Past two years have been a great challenge for poultry producers with escalating costs of inputs of Corn and Soya. They have undertaken a new journey of branding 280+ stores of Suguna with Delfrez with new signage and brand identity and focusing “only offline model as of now”.
To the question of supply constraints he replied that way back in 2002, Suguna started its first processing plan with 3500 birds per hour capacity with a total capacity of 6000 birds per hour then in India. However, presently the overall capacity in India is 1.4 lakh birds per hour with maximum utilization of only 70%, rest being idle because of processing alone being not lucrative.
Delfrez has chalked out greater expansion capacity with acquiring two plants in Chandigarh near Ambala and one in Belgaum. They have acquired land in Mandya near Bangalore for a Greenfield processing plant which will be ready in 15 to 16 months. They have identified five places in North, East, Andhra Pradesh, Tamilnadu to make them up and running in next 24 to 36 months. He concluded saying that “Price has to be supportive for sustainability”.
Mr. Susheel Konagolu and MBA from UK, retail exporter and a third generation sea food exporter had setup brand FIPOLA (Fish – Poultry – Lamb) in 2016 to create a consumer brand in India. Representing Fipola, Dr. Sanjoy Das, Chief Operating Officer narrated their journey to start with 3 shops in Chennai with two concepts, 1. Exclusive Stores and 2. Neighbourhood stores. 9 shops in 2018, 17 in 2020, 61 stores in 2021 and targeted 100 shops by March, 2022. Fipola has a staff strength of 1,200 with 140 crore investment.
Fipola has chosen colour yellow signifying chicken meat and their shops having an architecture of 3 chambers, front being a display area, second for processing, third for consumer interface. Their shops are generally 1500 to 2000 sq.ft. with an investment of 15 to 30 lakhs.
Mr. Abhishek Negi, IITian from Kharagpur started his venture in 2017 finding an opportunity of protein deficiency in India and majority of the Indian population being deficient of Vit.D and B12. They wanted to solve the problem of non-availability of quality eggs, packed eggs, graded eggs etc. All four of them IITians without knowledge in poultry setout “Do it ourself” started a 12,000 layer unit in Nalanda, Bihar to learn the entire process. They established a brand Eggoz jus to crete a brand similar to Milk of Amul, Bread of Britannia, Annapurna of ITC, Meat as in Licious and Fresh to Home.
They created an Asset lite model by adoption of artificial intelligence, Machine Learning, IoT platform for the farmers tiedup with Eggoz. They give all the backend and frontend support and buyback the eggs at a premium price. Eggoz presently doing in 11 cities and claiming to be No. 1 in North India and entered Bangalore recently. Abhishek acknowledged the contribution of government namely NABARD in funding their startup (NABARD has funded Tendercuts also).
Mr. Mahesha, founder of My Chicken and More established his venture in 2007 by his earlier experiences of working in leading feed sales division and working in leading chicken processing plant. This rich experience and enthusiasm and a commitment to provide healthy, hygienic quality meat with great shopping experience has created 16 outlets in Bangalore with largest outlet being 2400 sq.ft. Mr. Mahesha is passionate to work hard with a social responsibility of providing protein food to the Nation. He has set out a target of setting up of 200 outlets by 2025.
Mr. Harsha the founder of The Meat Factory established this brand along with his two friends experts in software sector. Mr. Harsha having worked in Godrej Tyson Foods for 6 years has developed the knowledge of providing safe hygienic meat for the consumer. They have setup 6 shops in Bangalore with a mission of providing quality product, hygiene environment and best price with large store space of 2600 sq.ft with a ambience for consumer experience with ice cream lounge, children play area in their shops.
Dr. Mahesh P.S., Joint Commissioner & Director, CPDO&TI mentioned that Team CPDO&TI would conduct many such programmes in the coming months. The programme was conducted live on zoom, youtube channel of CPDO&TI along with recordings posted on facebook: cpdoti.bangalore, on youtube: CPDO&TI TRAINING. All are requested to download “Latest App of CPDO&TI” from Google Playstore by typing “CPDO&TI” for Android Version.
Sri. S.M. Anwar Basha, Senior faculty of CPDO&TI executed the job of Admin of conducting Online Round Table very effectively. CPDO&TI acknowledges contribution of Mr. Santhosh Nandavanam in designing the invite, facilitating Zoom and other support. The other team members of CPDO&TI worked hard in making this programme successful. Team CPDO&TI thank all the viewers participated through Zoom and Youtube. It is also acknowledged that Print Media extends great support by wide coverage of all online events of CPDO&TI across the country.
Click link for viewing full recording of the event https://youtu.be/4XiYtbQ5RQY