Strong end-to-end cold chain is key for packaged meat industry, says Harsh Razdan
According to Razdan, in India, the growth in the meat sector is mainly led by poultry and chicken whose market size is expected to grow significantly because of its relatively affordable pricesUpdated: Sep 21, 2019 14:41 IST
Harsh Razdan, partner and head, Consumer Markets, Internet Business and Life Sciences, KPMG gives an insight on the packaged meat industry
What do you think of the packaged meat industry? Its growth? Its prospects?
Due to the still lingering large-scale preference for fresh meat, the market size of processed and frozen meat is very minuscule. However, the volume of processed meat and fish consumption in India is expected to grow in the coming years. In India, the growth in the meat sector is mainly led by poultry and chicken whose market size is expected to grow significantly because of its relatively affordable prices. In addition to this we have a young demographic, rising disposable income and time pressed urban consumers looking for convenient meal solutions without compromising on health aspects are majorly driving the market for packaged meat and seafood category. In this scenario there is the inadequate end–to-end cold chain infrastructure, which limits the shelf life of packaged meat and results in high wastages. In 2018 the sales of fresh and processed meat was sluggish owing to retailers being hesitant to sell processed beef along with other meat at stores, fearing complaints and a drop in sales and store foot fall. However lamb, goat, pork and other types of red meat are sold in the frozen format in India. Here demand is very limited as fresh red meat is available in butcher shops at cheaper prices. This has been a major challenge for the growth of all frozen processed red meat.
What are the challenges for startups in this sector?
Poultry/livestock farmers require handholding and adequate working capital support. There is the issue of desired quality. Real estate costs are high along with inadequate staff training and pilferage. Predicting demand to maintain smooth supply is quite a challenge given that the product is highly perishable.
And your advice would be...
One is having an end-to end-strong cold chain infrastructure, sufficient storage space, and skilled knowledgeable manpower to handle these ultra-fresh products. It is also equally important to understand and analyse region-wise consumption patterns to understand the evolving market dynamics. Likewise, it is also important to educate store-wise vendors to follow all food safety standards while handling these products
Is technology a factor in India? Can it help?
The average shelf life of two days makes it critical to implement tech interventions to optimise iinventory and processing. There is huge scope for algorithms to be leveraged to predict demand: based on the data collected. That, in turn, determines the supply that needs to come into the warehouses from the farms thus, reducing incidents of product unavailability. Inventory management systems can map and track to reduce wastage. Cuts are made using optimisation algorithms to reduce wastage and mobile apps can play a huge role in facilitating delivery.
Quality and efficiency are the key to a successful venture in packaged meat business.
Cut the fat to deliver meat
- Integrated supply chain by onboarding poultry farmers, aggregators, processors
- Curbing wastage, exercise control quality and keep costs at a minimum
- Strong cold chain capabilities and infrastructure
- Investing in last mile delivery to ensure timely delivery of fresh cuts
- Maintaining enough inventory is key to retaining customers and avoiding stockouts.
- Processing units should be located at an optimal distance from consumption hub to optimise logistics cost
First Published: Sep 21, 2019 14:40 IST