Doctors are not the only ones hardselling breakfast as the most important meal of the day. Major retail chains are increasingly stepping up the space devoted to a wide range of breakfast items.
Multiple brands and varieties of cornflakes, muesli, biscuits, muffins, cakes, jams, butter, cheese, juices, tea, coffee, milk, noodles and sauces, among other breakfast essentials, have started occupying significant shelf space across retail outlets.
Estimates suggest, these products are taking up around one-fourth of the total food shelf space across many retail outlets in India and the segment is growing rapidly, at around 30 per cent a year.
Research and consulting firm, Technopak Advisors, said the segment has gone up in popularity. The items comprise anything between 10 per cent and 20 per cent of the total food section for a supermarket, said the firm’s vice-president retail, Purnendu Kumar.
“This is additional sales for a retailer, as these are new consumption categories that are replacing the low-margin raw commodities.” Kumar said there is a huge impact of the growing spread of breakfast items on the retailers’ revenue.
Devendra Chawla, president, food & FMCG, Future Group (that runs the Big Bazaar chain) argued that these were high-ticket products, thereby increasing the chain’s ticket size. “Most new age categories provide higher margin which helps improve our margin profile.”
Speaking on the impact of the breakfast category on overall revenues, Aditya Birla Retail CEO Thomas Varghese said: “Of course, this leads to additional sales. He said the breakfast items were growing faster than the processed foods category, which itself was growing rapidly. “To cater to the increasing demand, we are using a three-pronged approach.”
The strategy includes increasing space, creating multiple touch points and more points of interaction between the shopper and the product, and enhancing the supply chain efficiencies. “We have used all of these to manage and benefit from the increasing demand.”
A Bharti Retail spokesperson said due to rising per capita income, consumer awareness has also increased. “We are currently witnessing strong double-digit growth upwards of 30 per cent in this segment.”
Agreed Future Group’s Chawla: “There is a substantial increase of assortment in these categories. For instance, cornflakes category has seen many variants like K and others which have targeted the diet conscious customer. Oats is another breakfast cereal which has seen brand play in the last few months.” The same is true for instant mixes (upma/oats/ragi), digestive biscuits and processed milk.
“As there is increased assortment and noise on these categories, the space has increased due to more wallet share spend on these categories,” said Chawla. The young demographic profile, increasing income, time constraint due to the number of working couples going up, receptiveness to try out newer cuisines and awareness on healthy eating are among the many reasons making the breakfast popular.
Advent of private labels in organised retail stores have also contributed to the growth of this category, said a Bharti Retail spokesperson. “Private labels are typically priced much lower than national brands, which incentivises and encourages consumers to consume more from this category, thereby increasing sales.”
Technopak’s Kumar shared similar views. “Apart from changing the consumption pattern, it is also due to entry of products and brands at reasonable prices that these items are selling so well,” Kumar said.