Challenges Facing India's Bakery Industry

Even as the multi-billion dollar bakery industry in India is slated to record a healthy growth rate over the next five years, the industry is facing challenges of getting skilled workforce that can help meet the new-age demands and increasing the hygiene standards in food production facilities among others

- Jyotismita Sharma

The bakery industry in India is experiencing robust growth – over nine per cent – according to a recent report. It is a huge industry, employing a large number of people. In fact, with over one million unorganised small-scale bakeries and more than 2,000 organised or semi-organised bakeries, the bakery sector is the largest of all the segments of India’s food processing sector. A report released by leading market research company IMARC in March 2019 stated that the Indian bakery market reached a value of $7.22 billion in 2018. The market value is projected to exceed $12 billion within the next five years, expanding at a compound annual growth rate (CAGR) of 9.3 per cent during 2019-2024.

As bakery products prov ide both convenience and affordability to the consumers, their consumption level has witnessed a rise in the past few years,” according to the report titled “Indian Bakery Market: Industry Trends, Share, Size, Growth, Opportunity and Forecast 2019-2024”.

A large part of this market – nearly 80 per cent – is captured by bread and biscuits which are items of mass consumption. In fact, India is second only to the US in terms of biscuit production. As breads and biscuits are fast-moving consumer goods (FMCG), they are consumed on a daily basis by the consumers, which is main reason for increases in sales of these products in India.

“In addition to this, growth in the fastfood chains further stimulates the demand for breads as they are used for sandwiches, burgers, soups, snacks, etc.,” the report stated. Moreover, introduction of valueadded bakery products is giving an impetus to the market growth. Apart from this, busy lifestyles, changing eating habits and western influence has reflected in a strong demand for bakery products in India, it added.