Saturday, June 3, 2023

Winter ice cream business nears summer levels

Are people consuming more ice cream during winter? Ice cream makers say that while summer months still dominate sales, the seasonal variation between hot and cold months is reducing. Typically, sales in winter months fall sharply due to seasonality and reduced incidence of consumers venturing out of their houses. While out-of-home consumption is key for ice cream sales, what’s also driving revenue is individual in-home consumption due to quick commerce.
Normally the first six months of the fiscal year can account for 60% of annual sales, or even higher for some brands. Graviss Foods (Baskin Robbins) CEO Mohit Khattar said, over the years, the company has been witnessing relatively stronger performance in the winter months (or the second half of the fiscal year). “Contribution for the second half of the fiscal year is now up to about 47% from 40% of annual sales. Given the robust growth that we have been witnessing, our average sales in winter months were almost at similar levels as sales in summer months in the 2019-20 (pre-Covid) period,” said Khattar.
The trend of ice creams being consumed during off season would be no different for other players, say experts.
Indian Dairy Association president R S Sodhi said, “The seasonal variation in consumption of ice cream is certainly reducing and one of the main reasons is that individual consumption of ice cream at home has gone up due to e-commerce and quick commerce. People also have bigger freezers at home. Additionally, there is a wider choice in flavours today as compared to, say, a decade ago.”
Sodhi, however, said the seasonal variation in the north would still be wider as compared to other regions. “If the ratio of consumption is 1:5 between the peak seasonal months of winter and peak summer in the north, in other regions the same would be 1:2,” Sodhi said.
With around 850 stores, Baskin Robbins is the second largest QSR brand in India. Amul, the largest ice cream player, recently said it plans to roll out 100 ice cream parlours in the country, offering premium ice cream flavours.
At an industry level, ice cream is growing at about 17%, said Khattar, with Baskin Robbins growing at a faster pace than the industry. The prime drivers of growth, he said, are the Gen-Z. “Earlier, ice cream was a relatively reward-driven category. That behaviour is changing now. People like to celebrate their little joys with ice cream. Today, there are multiple occasions for people to consume ice cream, whether it’s while binge-watching movies or going out with friends to the multiplex or any other reason. Occasionally, you see consumption going up. On women’s day this year, we suddenly saw a surge in sales,” said Khattar.
A closer look at data for women’s day revealed that most of the increase was limited to metro cities and to select products like celebration ice cream cakes. Mumbai led the charts with over a 50% increase from the corresponding similar day sales a week earlier. Cities like Bangalore and Delhi did well too. Kolkata was conspicuously behind at 25% growth.

Source link

Latest news
Related news