Haldiram’s is a multi-cuisine Indian fast food restaurant. They are the leaders in terms of the Indian fast food concept. They are one of India’s largest snacks and sweet manufacturers too.
Haldiram’s was the only company that had emerged in its own way. They are located in many parts of India, including Delhi, Gurgaon, Nagpur, etc. Its goods are exported worldwide to a range of nations, including the United Kingdom, the United States, Canada, Australia, Srilanka, Singapore, Malaysia, Indonesia, Qatar, Hong Kong, Japan, Kenya, North Korea, Nigeria, Mauritius, Zambia, and Bahrain.
History of Haldiram’s
In the beginning, it was only one company: Haldiram’s. That was in the 1940s when it started. As time moved on, Pankaj’s great grandfather’s sons and their brothers, they spread all across India. They started using the brand name Haldiram’s.
During the early 1990s, this unique dynamism that occurred in the food sector for Haldiram occurred in terms of professionalizing and expanding the company. For that, Pankaj’s father was responsible. Their family moved from Bikaner, where they originally belonged, to Delhi in 1983.
Pankaj’s father started a small shop in the Chandni Chowk area of Old Delhi after moving to Delhi. Very soon, the brand name became popular because of the quality of the snacks produced. They set up their first production unit in Mathura Lane, Delhi in 1992, and that’s the time they began selling their goods because they used to sell only at their shop earlier. Wholesalers or shopkeepers used to come and they used to buy from there, but they didn’t have any sales force or any marketing network. So, in 1992 they launched a proper package.
They started marketing when they began their manufacturing unit in 1992 at Mathura Road. It was from 1996 or 1997 that they started their exports. So, it’s only about fifteen years that the brand name has actually taken off in terms of becoming national.
According to Pankaj, his strength lies in understanding the people he is working with and in understanding the needs of the customers in terms of taste preferences. He assesses the strengths and weaknesses of his company on a continuous basis and has a clear vision for Haldiram’s.
He says, “there is no chef on whom I can depend on who will control the quality of our products and since, it’s manual work, there are chances of getting the quality upside down. So, you have to have the knowledge otherwise they can fool you.”
Haldiram’s Marketing Mix
For namkeen, it was previously agreed that they had to market this item like a branded product and sell it internationally because there was no branded namkeen as such anywhere in the country at that time in 1992. So, they were the first to begin exploring and expanding the demand for branded namkeen. Their namkeen packaging is a separate business, but at each outlet, the sweets are made.
Haldiram’s used to make chole-bhature and they had 50 to 60 different kinds of products. They soon discovered that customers are not interested in all the products. There are some key products for which the customers come to their place. A customer won’t come especially to eat Pizzas or burgers to their place. They will go to McDonald’s or Pizza Hut. So, they had to focus on their strengths in terms of the products for which the customers from very far off place came to their restaurant.
Intervention into the fast food segment
Haldiram’s expertise is in dosas, ice creams, Indian sweets, and North Indian snacks, including samosas, Pao bhaji, chole bhature, namkeen, etc. This will continue to be Haldiram’s dominant position. When they started their production unit on Mathura Road in 1992, they only started with a showroom. At that time, they didn’t have a restaurant, and Pankaj’s father began the fast food idea sometime between 1994 and 1996, but only with very small items.
Their brand name got even more popular because of the fast-food concept. Mathura road outlet proved to be the turning point in Haldiram’s business history.
According to Pankaj, Haldiram’s don’t have any defined vision as such. They just want to serve the best to the customers. That’s the only vision. The production capacity of namkeen in Mathura road is limited because of the space constraint. So, they started production in Gurgaon about a few years ago. They planned to shift all of their namkeen manufacturing to
Gurgaon from Mathura Road.
Today, Lehar, Pepsi, and Frito Lay are the main competitors of Haldiram’s in the namkeen and snacks segment and apart from that, there is no major competitor as such because the share of branded namkeen in India is not very big as a comparison of total sales of namkeen in the country.
It is 20% or 30% at the maximum of total namkeen sales all over India. If one goes to any city or village in India one will find dozens of local manufacturers who sell lose namkeen.
So, it’s really hard to compete in terms of pricing with them. They do not compete with Haldiram’s in terms of quality, but it is difficult for Haldiram’s to compete with them from the price point of view with their whole supply chain cost, delivery costs, retailer margins, etc. It is very difficult to compete with them.
Customers in smaller towns and villages want high service, but they can not afford it. They want a better price for something. Out there, they have a small market share for Haldiram.
According to Pankaj, namkeen is more than 90% of their total turnover and the fast-food segment is only about 10%.
In the namkeen segment, Haldiram’s are still the leader. Pepsi is not even near them in the country, but as and when they diversify from namkeen to other kinds of snacks like potato chips or extruded snacks, Pepsi has more know-how and knowledge about it because they have been into that business for a long period. So, in that area, it will be very difficult for Haldiram’s to compete with them in terms of technology and in terms of marketing.
FUTURE: Quest to become a global brand name
Pankaj thinks that the Indian fast food has not become global because of the characteristics of the product like Rajkachauri, as one have to have ten different kinds of inputs to add to make a Rajkachauri. For example, curd, and then there are two or three different kinds of spices. There are also a couple of ingredients that don’t have a long shelf life.
The other reason could be the fact that none of the Indian companies has invested in the packaging in order to increase the shelf life of a fast food product. In contrast, western products like burgers, pizzas, chips, etc are
available in the western markets in a frozen form and has a good shelf life.
There is no problem for western companies to send their products from America to India. They package it, freeze it and send it across due to frozen
technology and frozen supply chain. Haldiram’s can be positioned as an Indian fast food restaurant. It’s not a western fast food restaurant and does not compete with Pizza Hut or Dominos or even McDonald’s.
There is a big market, the world over in terms of Haldiram’s products to become a potentially global brand name. Every day they get e-mails from businesses in many countries that are interested in opening up a fast-food restaurant and asking for obtaining franchisees.
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