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Indian biscuits: Getting sweeter with time

Oct 4, 2000

The over 2 million tonnes per annum Indian biscuits market is valued at Rs 80 bn currently. It is largely dominated by the unorganised sector. The organised biscuit segment accounts for only a third of this market. Low margins, and a high level of fragmentation characterize this segment. Awareness is nearly 100%; however, penetration is lower in rural areas at 15-20% and at 60% in urban areas. This is mainly because these products are consumed as snacks, and do not form part of the main course meal. Volumes, brand loyalty and strong distribution networks drive this market, which is growing at 6-7% annually.

Britannia is the market leader with a 40% market share in value terms. Parle and Bakeman’s control 27% and 9% respectively of this market. Glucose biscuits account for 36% of the total organised biscuit market, followed my Marie and its variants at 18%.

Segment Market share Britannia's brands Competitor brands
Glucose 36% Tiger, Tiger Oro Parle-G, Ampro, Bakeman's Glucogold
Arrowroot / Marie 18% Mariegold, Jacob's Thin Maritime, Bakeman's Marie
Milk 12% Milk Bikis Parle Supermilk,
Bakeman's Milkobix
Salted 6% Snax Monaco
Sweet & Salted 8% Fifty-Fifty Krack-Jack
Creams 7% Elaichi Cream, Pure Magic, Orange Cream,
Bourbon Choclate Cream Jim Jam
Parle Orange Cream, Bakeman's Cream
Crunch, Horlicks, Sandwich Biscuits
Sweet Cookies 9% Good day, Little Hearts,
Calypso Coconut, Nice, Top
Bakeman's Butter-Yums, Horlicks
Bakeman's Cookiez, Parle's Hide & Seek
Wafers & others 4% Chekkers Rik Rak

The margins are small in mass-market biscuits such as Glucose and Marie, so companies look at these segments to gain volumes. To earn higher margins biscuit majors are bringing in a slew of speciality biscuits (like cream biscuits, cookies, wafer biscuits, cashew biscuits etc.). This segment is showing a healthy growth at 20% per annum.

The entry of foreign majors like Sara Lee is an indication of the competition brewing from overseas. It is not that domestic companies are missing out on the quality or technology (Britannia is promoted by Group Danone, France) but the entry of foreign players will put pressure on the domestic companies to introduce more variants of high-end biscuits.

Packaging of these products has already undergone a sea change in the last few years. Growing competition will force companies for ‘top of the mind’ product launches and adopt even higher standards of packaging and brand promotion. Britannia was one of the first companies to realise this. As a result, the company has redone its whole image and is trying to attract consumers on the ‘health and nourishment’ plank.

These are indeed exciting times for this segment.

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