Foreign fruits shaking up the Indian market
After a year of launching the Saboro (tasty in Spanish) brand of apples and grapes in Hyderabad, the Mahindra Group is now bold enough to enter the bigger metro markets, even as Adani Group’s Farm Pik apples continues with its attempts to push its brand in Delhi, Ahmedabad and Mumbai.
“Corporations are trying to brand fruits in a proper way. It has been a year since we have been in Hyderabad, and are now ready to roll out branded grapes and apples to new markets such as Mumbai and Delhi next year,” said Ashok Sharma, Chief Executive, Agri and Allied Businesses, Mahindra & Mahindra.
Quality assurance is the basic driver behind the acceptance of branded fruits. As Sharma said, “In categories like grapes, we doubled the price, and still found takers, since it all depends on the quality that is offered. Even in apples, which are at a 5-10 per cent premium, there are consumers willing to pay for branded apples from across the world.”
With a slew of apple brands like Stemilt from Washington, Enza from New Zealand, Capespan from South Africa, to relatively cheaper brands like Huaniu from China, consumers are willing to forgo loose apples available in the Indian market retailing anywhere between Rs70 and Rs150 for a kg.
Recently, Belgium’s largest cooperative for fruit growers, Belgische Fruitveiling (BFV) had entered the country through the Yuppa Group, which is into distribution and marketing of fruits, with its ‘Joly Red Apples’ and ‘Conference Pear’ to tap into the demand for branded fruit.
Ambrish Kavrat, Chairman, Yuppa, said, “Imported fruits like apples comprise just about five per cent of the market today, but such brands raise the bar in fruits, and makes local producers compete with its quality standards. Besides, when fruits are sourced from Indian farmers, the supply can get erratic. This is where imported brands can help with filling the gaps in demand.”
With high import duties slapped on apple brands (at 50 per cent) and pears (at 30 per cent), branded fruits are more expensive than their unbranded counterparts. However, that is not limiting purchases. “It is mainly modern trade outlets belonging to Reliance Retail, Future Group and DMart which stock our brands, and there is difference in the varieties on offer for imported fruit,” said Kavrat.
However, it is not easy to break the distribution barriers with respect to branded fruit. In the case of the Adani Group, though it did try to sell its Farm Pik apples as packaged consumer products through kirana stores and general trade in Ahmedabad, the pilot conducted across 200-odd shops was not successful.
“Our pilot across general stores did not take off and forced us to resort to fruit sellers rather than kirana stores with our packaged apple brand. It is not easy to market branded fruits, as retailers demand the same margins are loose fruit, which is not possible in the case of a packaged and branded product. While there is demand for branded fruit, we are still figuring out ways of how to take it to the market,” said Srinivasa Ramanujam, Business Head, Adani Agrifresh.
Source: thehindubusinessline.com
