We want categories outside biscuits to grow: Britannia MD Varun Berry

There is going to be inflation so far as wheat is concerned and we will probably be going for a 3-4% price increase starting Q4 across categories on an average

As Britannia Industries enters its centenary, the company is pushing hard to scale up its non-biscuits portfolio and is on the lookout for collaborations. Also, the company has lined up innovative biscuit launches for the current year. In an interview with Avishek Rakshit, Britannia Industries Managing Director Varun Berry opens up about his global plans to innovate, enter new categories and countries to make the firm a global brand. Edited excerpts:

I understand that you want to change the existing ratio of biscuits to non-biscuits from the current 75:25 to 50:50 in the next five years. Will biscuits have a lower growth rate than the non-biscuits segment to help pull up the ratio?

We are starting from a very low base in those categories so that growth is much higher. If you have a 10 per cent growth in biscuits a 20 per cent growth in these categories, then, obviously, the contribution from these categories will be higher. We want the extra-terrestrial categories outside biscuits to grow at least 1.5-2 times higher than the biscuits category.

Have you narrowed down on any category?

Lots of new formats (in cakes) are going to come — filled, layered and Swiss Rolls — all of that. A lot of investment in technology is going on. Chipita — filled croissants (brand) — is going to be a major category for us. 

So what kind of investments have you already made and plan to make on this?

On Chipita, the total investment is about Rs 800 million and the overall technology investment is Rs 1.2 billion. 

By when will you roll out these new categories?

All in this financial year.

After Deuce, what is the next big innovation you are going to bring in in the biscuits category?

Just wait for another couple of months and you’ll see a spurt in innovation and some of them are going to be very very different products from what you have seen in the past. 

You have said that instead of competition, you are open to collaboration. In which verticals do you want to collaborate?

If there is a requirement for categories within dairy, where collaboration is needed, we’ll be happy to do that. Any new category which is outside our core business will be considered for investment if we find that there is a partner who is strong in it, has the right products and the right brands. Then, we will be happy to collaborate. So, we are open and looking at creating a larger business. It could be outside India if we are entering a new country, and if we have to collaborate to enter a certain country, we will be happy to do that as well.

You have targeted to enter one new country every year. After Nepal, which region is on your radar?

Nepal is going to happen this year. This year, we are going to put up the plant (in Nepal) and it is going to be functional by the end of this financial year. For next year, we are already in the process of shortlisting (a country) — it could be either in the SAARC region or Africa.

Do you feel that your international business will contribute significantly to your revenue?

Currently, it is seven per cent and we hope to make that 15 per cent in the next 5-6 years. 

Wheat prices are on the rise. What happens to your cost structure and is there a possibility of a price rise?

Yes. We will have to take a price hike. There is going to be inflation so far as wheat is concerned and we will probably be going for a 3-4 per cent price increase starting Q4 across categories on an average.