JOIN USThe chief Executive Officer of the nearly Rs 600-crore MTR Foods, Sanjay Sharma, speaks of the company’s strategies and growth plans in the coming years in an email interaction with Deccan Herald’s Umesh M Avvannavar and Hrithik Kiran Bagade.
How has the journey of MTR been so far? What were the challenges and
accomplishments?
In 2007, Orkla, a Norwegian conglomerate, took over MTR Foods. Post the acquisition, we took on the challenge to capitalise on the immense brand strength that MTR already had. We undertook two fronts — externally with the brand and availability of our products; and internally with changing the organisational ethos from an owner-led company to a more professional, people-led organisation.
Externally, we changed our packaging to reflect our new identity and a new vision was drafted — “To be an indispensable companion in every kitchen to help create authentic and delicious Indian Food.”
We also increased our advertising spends and the frequency of our advertising on a national level. We introduced new and innovative formats like the multi-grain dosa, snacks and RTE cups over the years. We also strengthened our distribution and increased geographical reach by 300 per cent, reaching over two lakh outlets across India.
Internally, we changed the ethos of the organisation from being an owner-led company to being a people-oriented inclusive company.
We constructed a robust training schedule and have spent nearly 55,000 manhours in training till date. We now have a flat structure, variable pay, and a cross-functional working culture.
What is the company’s turnover for last year? Please give a brief about the company’s investments till date, and any more in the future. Towards what operations/activities will the investments be aimed?
Since acquisition we have had a strong, successful growth with a CAGR of 20 per cent.
Last year was a successful one for MTR Foods with us tripling our turnover since acquisition to close at near Rs 600 crore. In the last six years, we have invested almost Rs 150 crore on capacity enhancement, food safety norms, employee safety and hygiene, Information Technology (IT), and infrastructure.
We will continue to spend on research and development (R&D) as a major focus in the coming years.
Any innovations which you can share with us?
At MTR Foods we currently invest a lot in R&D, both at our in-house R&D centre and a separate wing called the Center of Excellence that focuses on cuisine studies and bringing authentic Indian food in a packaged format.
Today’s consumers are losing knowledge of preparing traditional Indian food. It is also perceived to be a time-consuming affair.
Our constant endeavour is to bring Indian food back in the consumers mind and for that we are reinventing certain categories and introducing new formats.
We conduct in-depth customer research to understand and customise each recipe to appeal to the regional palettes. Our sambar range is testimony to this.
We understood that the taste of sambar changes every few kilometres in the southern states and we spent days with our consumers in their houses understanding exactly what a homemaker wants in her sambar before introducing each new variant.
Last year, we launched our single serve sweet packs that provide indulgence on the go. Hygienically prepared and packed in micro-waveable, reusable cups, our single serve packs of two Gulab Jamuns or two Rasogullas have already become extremely popular and we have taken the range nationally now.
The RTE Poha that we also launched last year is another tasty surprise from MTR at the breakfast table. We also introduced our extremely popular multigrain breakfast mix range a few years back. We are also experimenting with frozen foods in the export markets.
Give an overview of the industry in which MTR operates. What is MTR’s share in various categories?
MTR is currently the leader in various categories nationally, specifically ready-to-eat currys, breakfast, and dessert mixes. In masalas, we lead in Karnataka with a 31 per cent market share and have an 18 per cent market share in Andhra Pradesh.
Who is MTR’s main consumer now? Does it differ for various products and according to geographies?
Though we look and cater to a cross section of consumers across our categories, our main target consumers are women. The homemaker of today is no longer in the background; she is a prominent family member and considers providing her family with a joyful, stress-free life, her primary motivation. However, she is also looking at spending less time in the kitchen and more quality time with her family.
She is also expected to serve food which is as good as her mother’s/grandmother’s. In the process, we discovered an important role that MTR should play in the consumer’s life — of being a friend in the kitchen by providing authentic Indian food in an easy-to-make modern format.
How would you describe the company’s product spread. Which products/product categories contribute the most revenues to MTR?
Ready mixes form a large part of our portfolio and consist of breakfast mixes, sweet mixes, snack and meal mixes. The other large part of our portfolio is pure spices and masalas which are mostly focused on the southern states.
The ready-to-eat category with north Indian curries, meal combos, traditional Indian snacks (currently distributed only in Karnataka) and sweets — tins and portion packs — are the third component. Other than these we also have vermicelli, health drinks, pickles and papads in our portfolio.
Please share few details about the production facilities of the company.
Our Bangalore plant can manufacture close to 50,000 tonnes. All MTR products are manufactured in a state-of-the-art, ISO 22000 certified factory under a completely closed environment.
MTR Foods has also met the stringent internal requirements of Orkla Food Safety Standards which are based on BRC standards and MTR complies with US FDA as well as Canada FDA requirements for foods.
We are investing heavily in our manufacturing facilities. We are building new plants and buying machinery even as we speak. Currently, we have seven units for our categories — spices and masalas, instant mixes that produce breakfast mixes, sweet mixes and health drink mixes, vermicelli unit, badam drink unit, snacks unit and the RTE unit, along with our own packaging unit.
Which countries contribute to majority of the company’s export market? Is there a trend to be noticed here?
Our export strategy is twofold. We have recently strengthened our presence in the 15 countries we were already present with the help of advertising.
We have also expanded our presence in seven other countries in the Middle East and Africa recently.
Our products are now present in kitchens and dining tables in 22 countries like the US, the UK, Australia, New Zealand, Japan, and Hong Kong.
What are your expansion and growth plans?
We achieved a major milestone last year when we crossed a turnover of Rs 500 crore and we aim to maintain a CAGR of 20 per cent over the next few years. We are currently one of the fastest growing players in the industry and our expansion plans are focused on maintaining this growth trajectory.