India’s food and beverage (F&B) industry is evolving rapidly, driven by changing consumer preferences, a demand for higher quality ingredients, and the push for more transparency. But beneath the surface, businesses are grappling with critical challenges that threaten long-term growth—high workforce turnover, unreliable supply chains, regulatory roadblocks, and a deep-seated trust deficit among consumers.
In a recent conversation with Ashu Agrawal, founder of Snackfax, I explored these pressing issues and what it will take to build a more resilient and credible food industry. While transparency in sourcing was a key concern, we also delved into the struggles of retaining talent, ensuring ingredient quality, and navigating complex regulations—all of which play an equally crucial role in shaping the future of the sector.
The Organic Label Dilemma: Can We Really Trust It?
One of the biggest hurdles in the organic food sector is the credibility of certifications. While India has regulatory bodies like the National Programme for Organic Production (NPOP) and PGS-India, their implementation remains inconsistent. Fake certifications are rampant, and many so-called organic products fail to meet strict quality standards.
Unlike markets in the US and EU, where organic labels undergo rigorous auditing and verification, India’s system still has loopholes that allow misleading claims. Consumers are rightfully skeptical—trust in food brands cannot be built through labels alone.
For brands that truly want to make an impact, transparency is non-negotiable. This means opening up supply chains, sourcing directly from verified organic farms, and making lab test results easily accessible to consumers. People are willing to pay a premium for quality, but only if they trust what they’re getting.
Finding Quality Ingredients: A Tough Nut to Crack
Beyond organic certifications, sourcing high-quality ingredients remains a challenge for food businesses in India. Running a café or patisserie, for example, means navigating fluctuating prices, supply chain disruptions, and quality inconsistencies.
India produces some of the world’s finest raw ingredients, but ensuring a steady supply of premium-quality products requires a well-structured ecosystem—something that is still developing. Importing ingredients is an alternative, but high import duties and regulatory barriers make this an expensive proposition for many businesses.
If India is to establish itself as a true leader in the global organic and premium food space, we need better infrastructure to support sustainable farming, efficient logistics, and quality control mechanisms.
Why F&B Struggles to Keep Its Workforce
The F&B industry faces a serious talent retention problem. Many employees see these jobs as temporary, leading to high turnover rates, particularly in entry-level roles. Workers often leave for a slight pay increase elsewhere, making it difficult for businesses to maintain consistency in operations and service quality.
This isn’t just an F&B issue—industries like construction face similar workforce instability. But in food service, where consistency is key to customer trust, the problem becomes even more pressing.
Continue Exploring: NONSTOP launches first flagship store in Mumbai, offering mobility and wellness solutions
To address this, we need structured training programs, clear career growth opportunities, and incentives that make F&B an attractive long-term career choice. Initiatives like the Food Institute in Bihar are a step in the right direction, but a larger, nationwide effort is required to professionalize the industry.
The Regulatory Maze: Simplifying GST & Business Policies
Regulatory complexities continue to pose a challenge for food businesses. While recent GST reforms have attempted to simplify tax codes, the industry still needs more targeted policies—especially when it comes to sustainability, waste management, and cold storage logistics.
Continue Exploring: The End of a Retail Era: Neville Noronha Checks Out, Anshul Asawa Checks In
Take the taxation of warehousing and storage, for example. A lower GST rate on cold storage facilities could certainly help businesses, but efficiency is the real concern. Personally, I’d rather pay a higher tax if it guarantees assured quality, seamless insurance, and a smooth legal process. For businesses, time is money—and the less time spent navigating bureaucracy, the better.
A possible solution? The government could create a Special Purpose Vehicle (SPV) dedicated to food industry regulation in key markets like Delhi, Mumbai, and Hyderabad. This could help standardize best practices and drive sustainability-focused policies.
What’s Next? A Food Industry Consumers Can Trust
The future of India’s food industry depends on three things: trust, transparency, and sustainability. Consumers today are more informed than ever and are willing to pay a premium for high-quality, ethically sourced products. However, the industry must take responsibility for ensuring authenticity, while the government must create an environment that promotes transparency rather than hindering it with red tape.
By strengthening organic certification processes, investing in sustainable supply chains, improving workforce retention, and refining regulatory policies, India’s F&B sector can move toward a more credible and globally competitive future.
At the end of the day, food is deeply personal—it’s what we put into our bodies every day. Consumers deserve to know exactly what they’re eating, and it’s time the industry steps up to deliver on that promise.
