India’s food service market has grown at a fast pace of 7.7 per cent making a big trajectory move of INR 4, 98, 130 crores with a CAGR of 10 per cent by 2021.
The market which is bigger than the bollywood industry and is third in India after Retail and Insurance is largely dominated by the unorganised market which still holds Rs 2,07,635 of the total Rs 3,09, 110 market of fast evolving food market in India.
Not only this, the industry is one of the biggest contributors of the job creator in the industry by direct employing about 5.8 billion, indirect employing another 7.5 to 8.5 million, and the two numbers are likely to rise to 8.7 million and 9.5-10.5 million by 2021, making it one of the largest employers in the country. “This year alone, the Indian restaurant sector will create direct employment for 5.8 million people and contribute a whopping INR 22, 400 crores by way of taxes to the Indian economy. As per the NSDC, restaurants contribute the maximum manpower requirement within the hospitality sector,” shared Riyaaz Amlani, President NRAI while releasing the third NRAI food service report at India Habitat Centre.
Shri Amitabh Kant, CEO, Niti Aayog who released the report appreciated the work NRAI is doing to promote the growth of sector and is also a wide contributor in increasing the GDP of the country said, “India has been on a high growth trajectory over the last couple of years. India’s exponential growth and consumption in terms of frequency of eating out and experimentation with cuisines and concepts has given the F&B services sector such a fillip that this industry is currently estimated to be worth USD 48 billion in terms of overall market size.”
The food services market in India has triggered growth across a wide range of ancillary industries, thus providing a boost to the entire ecosystem. Key allied industries which support food services and have benefited from its growth are agriculture and food processing, supply chain and logistics, real estate, kitchen equipment, and commissary.
Also, with organized market which is whopping at just 33 per cent of the overall food business, restaurateurs were highly distressed citing all these issues are a result of over regulation of their industry, the complex maze of approvals and licenses required and high tax brackets. “It is about time that our industry’s socio-economic impact is recognized by the government, and it initiates immediate steps to unlock the true potential of this behemoth,” added Amlani who is a wide eyed opener and has achieved a lot at the NRAI and is expecting brighter days in the near future.
Though, the industry has seen a steady growth in past three years since NRAI last released its big data in 2013 there is lot to achieve and lot to gain. The report also reveals that the industry has its fair share of roadblocks and challenges like high real estate and manpower costs, inadequate supply chain, infrastructure, financing issues and majorly policy formulation. The main aim of the report is to aid entrepreneurs and investors take informed decisions and unite the industry under one banner.