ADAG bites into food business

To launch in BIG Cinemas in India, abroad.

Brother Mukesh Ambani might be the king of retail, but Anil Ambani’s ADAG is getting ready to make its presence felt in branded food products. The group is all set to launch a food and beverage brand, ‘Movie Munchies’ and its own mineral water brand, ‘Spring’, later this month.

To be initially sold through ADAG’s 500-odd BIG cinema outlets across India, Malaysia, Netherlands and the US, the bigger plan is to sell a range of products under these two brands in airports and independent retail outlets.

“The offerings have been styled for an enhanced entertainment experience at our theatres. We are, however, also considering offering these products in retail outlets and airports but that will depend on the response we get,” said Arindam Chakravarti, head, F&B, BIG Cinemas.

The foray into branded food products has been dictated by the fact that over 20 per cent of the income in a movie hall comes from food and beverages. Anil Ambani has some presence in retailing through the “Java” cafes, which serve juices and hot beverages, located within its RelianceWorld stores.

“Movie Munchies” will offer 22 products that include varieties of fried finger food, salads and sandwiches, rolls and wraps, fresh coffee, pizzeria, candy floss, street food like chaat, ice creams, hot and cold desserts, mocktails, fresh juices and chocolate fondue.

“We are jointly developing the food and beverage offering with VKL Spices, a Marico company, and the products will be exclusively made for the company,” Chakravarti said.

For the bottled water, ADAG has tied-up with Mulshi Springs near Mumbai. The mineral water bottle will cost Rs 60 for a litre and the food range will be between Rs 25 and Rs 100. The first roll-out will begin on December 23, 2009 across 29 multiplex properties in India.

The second roll-out is planned for March 2010 and will cover the remaining India properties.

The third phase will include properties in Malaysia, Netherlands and US and is scheduled for June and July 2010.

Big Cinemas is not, however, the first multiplex chain to launch a food and beverage brand. Inox Leisure has its own food brand “Refuel” while PVR Cinemas has “Candy Bar and Munch Factory”.

“The food and beverage vertical is an important part of the theatre business. It contributes to almost 20 per cent of our total turnover,” said Alok Tandon, CEO, Inox Leisure.

Added Gautam Dutta, Head-Marketing, PVR Cinemas, “No multiplex can ignore this business because apart from the box office, food and beverages are a core revenue source contributing around 24 per cent to the overall revenues.”

Others like Fame India and Fun Cinemas outsource this business to vendors who install kiosks at the cinema halls.