Sauces-dipping and cooking as a food segment is seeing a steady spike as people are getting swish with their culinary experiments to bring home the joys of dining out, as many restaurants, cafes, and pubs continue to remain shut to curb the spread of coronavirus.
According to data from Kantar Worldpanel, which tracks purchases of over 80,000 Indian households every month, sale of sauces alone grew by 32 percent in the March to June period.
And it is growing as stay-at-home people are cooking like never before. Crumpets, quiches, pizza, pasta, soups, noodles, curries – Thai, Sri Lankan, Indian are all being rustled up in the home kitchen.
Aiding the process is a myriad of sauces available in the Indian market like Aioli, Arrabiata, Chipotle, Peri Peri, Harissa, Asian Sweet Chilli, Sriracha, Schezwan, Hollandaise just ready to be added to raise the oomph of any dish or cuisine.
Naturally, top companies in the sauce segment such as Dr Oetker, Del Monte, Cremica Food Industries, Veeba, Hindustan Unilever Limited (HUL), Nestle, Smith and Jones among others have all seen an uptick in demand over the last four months.
“We are witnessing a double-digit growth of over 20 per cent in ketchup sales and we expect it to increase further with the festive season at hand,” said a senior official at HUL, which owns the ketchup brand Kissan.
While ketchup has been the traditional and most popular table sauce in India for years, demonstrating strong value growth year-on-year, other sauces like mayonnaise, salsa, sweet onion, etc have been fast catching up.
According to industry experts, thanks to the recent boom in the fast-food industry, changing lifestyle, and the huge influence of international cuisine on rising economies like India, the demand for sauces in the last five years has surged manifold.
Globally too, this has been the trend. According to Research and Market’s forecast, from 2020 to 2025, the global sauces and dips market is projected to soar at a CAGR of 6.97 per cent from a market size of $138.195 billion in 2019 to a market size of $207.049 billion by the end of 2025.
In India, the addition of new varieties of sauces, dressings and dips to the traditional fare, especially catering to the Indian consumer’s global palate by companies like Veeba Food Services, Ceramica, Del Monte, have further pushed sales in this food segment.
Pandemic related disruptions
Amidst the unprecedented Coronavirus outbreak and indefinite lockdown imposed across the world, the food and beverages industry including condiments and sauces with extended shelf life witnessed surging demand.
Consequently, the demand for such products skyrocketed during the first phase of the crisis.
According to a senior official at FieldFresh Foods, promoters of Del Monte brand of premium packaged food and sauces, the company witnessed a sharp increase of 80-200 per cent in sales of products like olive oil, sauces, as home cooking and baking activities went up during the coronavirus-induced lockdown.
Of course, even as demand increased, the lockdown left companies struggling to cope with various supply chain disruptions.
Further, with out-of-home sectors like hospitality, restaurants, severely compromised during the lockdown, the sauce and condiment companies lost a chunk of that business.
For Instance Veeba, which supplied to chains like Domino’s, Pizza Hut, Dunkin Donuts, Burger King, KFC, and Starbucks, took a big hit like many others in this segment.
On the brighter side, retail consumption increased dramatically.
“On one side of our business, we are really seeing momentum. If you look at retail, in the condiment category, the ketchup category, the mayonnaise a category, we are growing massively. Pasta sales have doubled, our ketchup condiments are also selling in a very high percentage. Great growth is happening on the retail side,” says FieldFresh Foods CEO, Yogesh Bellani.
Challenge is, however, logistics. Companies have leveraged their online presence as a preferred method of delivery to adapt to this evolved business environment. Most have signed by with food delivery companies like Swiggy, Zomato, Amazon, Flipkart for extensive customer reach.
Also, tapping into smaller tier II and tier III cities make for sound business sense.
Most companies in the condiment and sauce segment are upbeat about the rising domestic demand. Sunil Bijlani, who sells a boutique brand of sauces in Mumbai – Mrs Peppers, says even after the lockdown is lifted, people will avoid eating out and prefer home-cooked food, thereby boosting the demand.
Dipping into the current demand for sauces for home consumption many big restaurants are finding innovative ways to remain afloat. Big eateries like Fig and Maple, Yuatcha, Nara Thai, Mamagoto, are now delivering DIY (Do it yourself) kits at homes for their popular dishes.
The kit contains pre-made items such as sauces, gravies, and dips, along with cut vegetables, meats, and instructions.
The signature sauces are complex and difficult to replicate at home. For instance, Fig’s Raw Mango Thecha and secret spicy sauce are versatile and can be used as dips, as sauces in gravy, or replicate the restaurant’s signature bowls.
At Rs 200 to Rs 650 these sauces are finding big discerning takers in cities like Mumbai, Delhi, Bengaluru, and Kolkata.
The lockdown has also presented an opportunity to restaurant owners to market super seasonal and immunity-boosting food and sauces replete with ginger, basil, curcumin among others to people.