Partnership model over transactional business to thrive in hospitality sector

The Covid-19 pandemic wreaked havoc globally changing business dynamics in a way never perceived before. Nilabja Dey, Director – Commercial, Sharad Food Solution, in conversation with World of Hospitality gives a bird’s eye view on the change in business dynamics of the hospitality industry and allied sector amid the pandemic

How did the pandemic impact your business?

The pandemic stirred havoc globally by impacting the economy; rocking consumer sentiments and upending traditional businesses from functioning normally. As part of Damodar Chakubhai Group, we at Sharad Food Solution have been supplying quality dairy products of Nandini and Warana to institutional clientele, especially the HoReCa segment. Given that the HoReCa sector was the worst-hit, we being an allied industry saw a nosediving dip in sales of our products. Having seen a growth rate of 30 per cent year-on-year while catering to this segment in the yesteryears, with the outbreak of the pandemic, the pandemic period was indeed trying times for us as a business.

However, our striving efforts kept us afloat with the trust vested in us by our partners. At Sharad Food Solution, we abide by the principle of welfare of all the parties associated with us. Right from the farmers, to the workers in the supply chain to consumers, we at Sharad Food Solution had it deeply ingrained in us that no one must suffer either on price or on quality of our products throughout the unprecedented times brought in by the pandemic.

What was your contingent plan for the business during the pandemic year 2020?

For a fact, we entrusted the adage “A crisis provides the opportunity for us to do things that you couldn’t do before” – Rahm Emanuel. Having seen the diminishing demand from our traditional HoReCa clients, we studied the market sentiments from a consumer’s viewpoint and accordingly moved our efforts to bridge the prominent gaps. We saw that though sit and dine restaurants were seeing zero to minimal diners, the demand for outside food being consumed at home was still there. We witnessed that cloud kitchens/ dark kitchens/ delivery-only food outlets were seeing a fair share of the consumers ordering from them through food delivery apps like Zomato and Swiggy. We quickly focused on engaging with these players to provide them with quality dairy products like paneer, milk, ghee, etc., to help them serve the end consumer better.

With the pandemic breaking out, we saw a shift in people’s working sentiments wherein the traditional hierarchy model was done away with and the partnership model was seen ushering in most businesses. Tapping this potential, we envisioned expansion of the ‘Factory Outlet & distribution’ model wherein we cater to a larger pool of consumers, both retail and institutional remotely and also subsequently work in favour of the partner. The model has picked popularity and we are increasingly seeing enquiries from prospective partners. The brands that we serve have garnered good mileage through this model.

In terms of government policies and reforms, how do you eye for changes moving forward?

We appreciate the government for the efforts that they took to streamline our production and supply chain processes by allowing free movement of the vehicles and providing us with essential workforce tags and ID cards during the nationwide lockdown period.

Our only age-old request to the government remains that stringent action needs to be taken against players who indulge in adulteration in the dairy industry. We request the government to cancel the licence and penalise heavily to the unscrupulous traders who manipulate the quality impacting the health of a large population which consumes the products. We have been urging FSSAI to crack down on unlicensed distribution establishments and educating the consumers more about the health and hygiene factor when it comes to the handling of their food.

To date, we see that certain businesses indulging in undocumented transactions in a bid to evade GST. The government needs to educate about the complex structure of GST to avert malpractice.

What is the future roadmap for the company?

Having seen the potential that retail offers, we will be further eyeing to expand the Factory Outlet & Distribution model at various locations across the country through a strong partner network, further strengthening our brand presence.

It is also to do with the fact that having attained the leading position in catering to the HOReCa sector, we certainly will have our focus on reinstating the business through this channel with time. We will be looking at engaging more with the sector through thoughtful deliberations to understand their pain points and customise the solution suiting their needs.