Baskin Robbins has established a new production facility in Shirval, Pune, with the capacity to churn out 7.5 million litres of ice cream per shift, in response to the high demand for their products in the Indian market and subcontinent.
Baskin Robbins, which entered India through a joint venture with the Graviss Group, has seen growth in footfall at its ice cream parlors and a steady increase in online sales. According to Mohit Khattar, CEO of Graviss Foods – Baskin Robbins, around one-third of the company’s sales now come from online and delivery platforms such as Swiggy, Zomato, Instamart, Big Basket, and Zepto.
According to Khattar, Baskin Robbins’ online segment could further grow if they can address the last-mile cooling requirements for home deliveries of ice cream. Currently, ice creams are delivered in ice boxes or other types of containers, but the company is exploring solutions with improved insulation that can better withstand outside heat, he added.
Their data showed that people who walked into their parlours were the ones ordering online. So, the company was looking to grow their premium (INR 69-350) ice cream parlour chain. The company’s 850 parlours in 239 cities accounted for 67% of the turnover. “We are the second-largest QSR chain in the country with a presence in Tier I, II and III markets. We will be adding another 100 stores,” Khattar said.
Despite growing 30% year-on-year, outpacing the industry’s 15% growth, Baskin Robbins CEO Mohit Khattar has expressed concern over the rising prices of key ingredients such as milk and milk products. While the demand for their ice cream remains robust, the company only uses cow milk and cream, which has been impacted by the price surge. However, they have decided to maintain their current prices for the season. Khattar explained that they had expected the prices to cool down, but this has not happened. Milk prices have risen by 25% in a year, resulting in a 2-3% hit on margins. The company last raised its prices nine months ago and will make a decision about another price hike in September-October.
The introduction of the ‘Pizza Ice Cream’, an eight-inch brownie base topped with ice cream and various toppings, marks a first-of-its-kind product for Baskin Robbins. Building on the success of their ice cream cakes, the company has also launched a new format called ‘ice cream rocks’, consisting of bite-sized ice creams coated with chocolate and other flavors.
Baskin Robbins has expanded its product line with 17 new offerings for the summer season, including flavors such as caramel milk cake, blueberry and white chocolate, and fruit ninja.
According to Khattar, the Indian ice cream market was estimated to be around INR 19,000 crore in 2022, with the unorganized sector still holding the majority share of 55-60% of the market. He also mentioned that despite the pandemic, the industry witnessed growth, and Baskin Robbins experienced a year-on-year growth rate of 30%, which was faster than the industry’s growth rate of 15%. However, the company’s only concern is the surge in the prices of key ingredients like milk and milk products, which has impacted their margins by 2-3%. Baskin Robbins uses only cow milk and cream, and they have decided to hold prices for the season, but they may consider increasing prices in September-October.
According to an IMARC Group report, the ice cream industry in India is expected to grow by 17.5% between 2023 and 2028, reaching INR 50,000 crore.
