Mumbai’s Scandalous Foods, a B2B sweets startup founded by Sanket S, has set its target to make most out of this festive season. Having closed a pre-seed funding round of INR 3 crore in February from the Indian Angel Network, the company is poised to enter the HoReCa (Hotels, Restaurants, and Cafés) segment and aims for a 75X increase in Monthly Recurring Revenue (MRR) by the end of the financial year.
Expanding Production Capacity
Founded in 2022, the company is working on to broaden its footprint across the food service industry and build a robust HoReCa base in key markets, including Mumbai and Nasik.
Sanket S describes the brand’s growth journey: “We started off with a 4,100 square feet production unit in January and were at about 9 lakh MRR back then. Today, we are at about 28 lakh MRR. We’ve added another 2,100 square feet of production capacity, which will be operational by mid-August, bringing us to 6,300 square feet.”
This expansion is a critical part of Scandalous Foods’ strategy to boost production from 10 tons to an impressive 75 tons per month by the fiscal year-end.
Sanket explains, “We’ve seen 13-15% month-on-month growth over the last six months, even in the pre-festive season. We plan to leverage this momentum as we enter the Horeca market.”
Continue Exploring: Scandalous Foods set to raise $12 million for expansion
Success factors
So far, from January to June, the company clocked 3X revenue growth—from INR 9 lakh to INR 27 lakh.
Sanket credits their human-to-human approach for their success in the B2B sector. “While we all call it B2B, I call it H2H – human to human. It’s about building relationships with key accounts like Zepto and expanding from cloud kitchens to QSRs (Quick Service Restaurants). We are now working with companies with more than 30 outlets, including regional players,” he says.
The startup has partnered with various restaurant chains, including in Bangalore and Pune.
Sanket also attribute to innovative product lineup for its growth. “Rasmalai is by far our top-selling product. We’ve introduced unique items like Mithai Sunday’s, with creations like Gulab Jamun and Jalebi Rabri, which are working well for us,” Sanket shares. They’ve also ventured into savory products, adding snacks like dry Samosas and seasoned Mathis to their offerings.
Continue Exploring: Indian delicacy Ras Malai ranked among the world’s best cheese desserts by Taste Atlas
Tapping into Corporate Gifting
This Diwali, Scandalous Foods plans to foray into corporate gifting and cater to the festive demand. “We will target corporate caterers for Diwali with products like Kaju Katli and Besan Burfi. Our focus is on being a B2B company, or H2H, and creating a category we can own,” Sanket says.
Besides that, the company vision extends beyond just expanding market reach. “We’ve created a category within sweets. Now, we want to be category leaders. We don’t want a huge company coming in and crushing us with capital,” Sanket emphasizes. “It’s a capitalist world, and we have to be mindful of that.”
Continue Exploring: 82% of Indians prefer traditional sweets over other desserts, survey finds
Navigating ahead
With a clear roadmap for the next six months, Scandalous Foods is committed to growing its clientele and increasing production. “We want to reach about 75X MRR by the financial year-end. The target is to have 100 clients in three months and to work with 200 to 250 small accounts by the year’s end. With 85-90% of the food service market in India being unorganized, we can’t miss that boat,” Sanket concludes, as he prepares to launch in the Horeca segment in August.
