Project Proposal and Business Plan

Table of Contents

1. Background

2. Why Frozen Food – Key Benefits

3. Frozen Food - Global Scenario and Indian Context

4. Untapped Market and Proposed Project

5. Project Positioning and First Mover Advantage

6. Project Financials

7. Implementation Plan
1. Background

Food had been the basic need for human beings. The food habits
of human beings evolved over ages and accordingly the
preferences, the way of processing, cooking and consumption
patterns get transformed steadily over the centuries across the
globe. As a part of steady transformation, demand for food in
frozen conditions started growing during the past few decades in
the developed countries and recently in the developing countries.
Frozen foods have the advantage of being very close in taste and
quality to fresh foods as compared with other preserved or
processed foods. Frozen foods are ubiquitous in western
supermarkets, and are increasingly a part of the food industry
worldwide including in India. Fruits and vegetables are usually
frozen within hours of being picked, and when thawed, they are
very close to fresh in taste and texture. The frozen meal is
increasingly popular in time-starved western households. With
rapid urbanization and increased women work participation in
India, huge potential for frozen food requirements is building-up.
In the late 1990s, the frozen food industry was expanding both
within the western markets and other countries. The industry's
biggest push was so-called home meal replacement, that is, whole
frozen meals that took the place of cooking from scratch. More
consumers were willing to trade the convenience of a frozen meal
for the satisfaction of making their own meal from fresh foods.
This meant that the industry was challenged to come up with
more elaborate frozen dishes, which required more testing and
experimentation to pull off than the relatively simple frozen
vegetables or waffles. This has expanded the range of frozen
foods right from raw materials such as vegetables, seafood,
chicken, mutton, dairy to huge varieties of ready to cook and
ready to eat processed food items. In most cases, the raw food is
specifically cultivated or adapted for freezing and in case of
processed and semi-processed food products, the recipes must be
tested and altered so that it freezes well.
2. Why Frozen Food – Key Benefits
As discussed in the foregoing, frozen food has distinct
advantages, when compared to the conventional food.

2.1 The advantages include :

I. Preservation of freshness, nutritional values and natural taste

II. More hygienic, particularly in case of non-vegetarian food

III. Availability of customized products and choice of quantity

IV. Round the clock availability and quick preparation

V. Well suitable for urban lifestyles, due to increased women

work participation ratio

VI. Availability of wide range of items and some of them are

otherwise difficult to prepare at home in conventional way

VII. Economical when compared to outside eating, particularly in

case of ready to cook and ready to eat varieties of frozen food

VIII. Suitable for travel, the modern varieties of frozen foods can be
consumed, without cooking, heating just by thawing

IX. Time saving due to ease in preparation Frozen food provides a

quick and easy way of helping people to improve their diets. It
doesn’t require any chopping or peeling which suits today’s
busy mums, it can often be prepared within minutes, and its
excellent nutritional benefits, all combine to make frozen food
the perfect solution to the modern day requirements.

X. Freezing is a natural process and does not usually require the

use of any preservatives.

XI. Frozen food seals in freshness. Frozen vegetables, for

example, are picked and frozen within hours of harvest,
therefore locking in the vitamins and minerals, as well as the
taste and texture.

XII. Thanks to freezing technology, people can enjoy all types of

food throughout the year, regardless of the season at
affordable prices.

XIII. Freezing food could kill or reduce many potentially harmful

microbes, which cause food poisoning.

XIV. Frozen food tends to cost less than fresh, can be stored for
much longer and offers brilliant flexibility for meal planning,
 thereby reducing wastage.

XV. Manufacturers are able to freeze food within minutes, which,

compared to home freezing, gives a superior texture, taste and
appearance, as well as retaining the nutritional value.

XVI. Frozen food is easy to keep and easy to use, and there is little
waste, whereas two thirds of the population ditch anything up
to 20 items of fresh and chilled food a month.

XVII. Frozen food gives consumers a quick and convenient way of

fitting in a nutritious meal.
XVIII. Maintenance of uniformity in quality
2.2 Nutritional value and retention of flavour

Foods which are quick-frozen when they are at the peak of their
flavour retain higher nutritional value and do not require any
other method of preservation. In addition, they retain nutritional
value because storage at temperatures below -18° C slows natural
degradation processes to almost nil. Most commercially produced
fruit and vegetables are frozen immediately after harvest when
nutrient concentrations are at their highest. This is very
important as concentrations of some vitamins can decrease by 50
percent within the first 7 days after harvest when stored at
normal temperatures. Frozen foods have the advantage of being
very close in taste and quality to fresh foods as compared with
other preserved or processed foods. People often mistakenly
believe that only fresh fruits and vegetables are of benefit and
that processed produce does not provide the same levels of
nutrients, due to losses during the processing procedures. In
actual fact, some methods of food processing, such as freezing,
can actually help preserve levels of nutrients in the food, as the
nutrient concentrations are placed in ‘suspended animation’
whilst the product remains frozen. Studies have shown that
vegetables stored at room temperature over 2-3 days may lose
50-70 percent of their folate content. Most vegetables and fruit
that is to be frozen, is picked, packaged and frozen within 6 hours
of so of being harvested. Many frozen vegetables have more of
certain vitamins than the fresh ones that may have been
harvested 5 or more days before you cook them.

2.3 Preservation

Frozen food is food preserved by the process of freezing. Freezing

food is a common method of food preservation which slows both
food decay and, by turning water to ice, makes it unavailable for
bacterial growth and slows down most chemical reactions.
Freezing only slows the deterioration of food and while it may
stop the growth of micro-organisms, it does not necessarily kill
them. Many enzyme reactions are only slowed by freezing.
3. Frozen Food - Global Scenario and Indian Context

3.1 The people across the globe have started recognizing the above
key advantages of frozen food and changing their preferences
towards frozen food over conventional food. The frozen food
industry has expanded rapidly because of the labor-saving and
space-saving advantages of frozen foods and because the
freezing process generally involves less loss of taste, flavor, and
appearance than do other methods. Researchers say that fresh
vegetables which have been imported from a distant country may
also have fewer nutrients. Globally, particularly in developed
countries, the acceptance and consumption of frozen food was
already established, when compared to developing countries like
India.

3.2 (a para on Indian retail market, fast growing organised retail market and its
potential)

As in the case of retail market, due to increase in real income

levels & purchase power, rapid urbanization, with increased
women work participation, Indian middle class is looking forward
to easy, quick, convenient and nutritious food to meet their
changing requirements of busy life styles. The frozen food in its’
multiple forms viz. raw, semi-processed and fully processed
(ready to cook and ready to eat) could effectively address most of
the above requirements and concerns due to its’ distant
advantages over the conventional food. The conditions of
increased health consciousness, preference to the hygienic food
and changing food habits also propel the people to look for
alternative to conventional food. Again frozen food is emerging as
the only alternate, because the manufacturer/processors of frozen
food take care of all such requirements including strict end-to-end
quality control in selection, process, preservation, transportation
and vending to the end users, thru’ proven technologies and
conforming world-class standards. Owing to inflation and other
factors, in the recent past, there has been steep increase in
prices of food materials in the Indian market with very frequent
fluctuations in prices. Frozen food, due to its’ distinct advantages
such as bulk procurement, contract farming, prevention of decay,
higher shelf life and uniform distribution, is greatly helping in
stabilizing food prices. Due to globalization, Indians are getting
exposed to international exotic food.

4.0 Untapped Indian Market, Proposed Project and Salient Features

Untapped Demand
4.1 With increasing demand, though there is huge potential for frozen food in
the Indian market, it is largely untapped due to non-realization of its’
market strength. Though there is a captive demand for the frozen
food from the high end segment of people, many of the players in the
market not able to tap the same, due to dispersed focus and giving
priority to the products with mass demand. The space allocation for
frozen food items in the currant retail stores is very limited. Due to the
above factors, the current retail formats do not offer the complete range
of frozen food available in the market to the consumers as such the
consumers are not aware of the products, varieties and range of frozen
food items and their distinct advantages.

Proposed Project

4.2. Currently there are no exclusive and dedicated retail outlets for frozen
food in India. Exclusive retail outlets for frozen food, will fill the
unoccupied space and will meet the acute demand-supply gap in the
Indian frozen food market. Fully dedicated space for frozen food would
not only meet the space requirements but also give more visibility to the
consumers. With the complete range of products available under one
roof, for the first time, the Indian market is going to witness and
experience the real world of frozen food. Exclusive outlets would only be
able to cater the complete needs of the all stake holders of the frozen
food industry, including producers, processors and consumers, with
focused approach due to its’ novel concept. The proposed project would
initially comprise 4 to 6 exclusive frozen food outlets in the high-end
markets of Hyderabad. The chain of such exclusive outlets would be
expanded to other parts of Hyderabad and later to other cities of India to
have a pan Indian footprint.

4.3 Salient Features

The proposed outlets, which will be first of its’ kind in the country, will
not only have the complete range of frozen food products from domestic
and international sources, but also have superior consumer friendly
environment, essentially based on value for money principle. The
proposed exclusive outlets will have high standard quality products with
accurate weighing and transparent billing. The pricing will be uniform
and competitive. The outlets will be maintained in highest hygienic
conditions with world-class standards of shopping convenience. Other
facilities that would be offered to consumers include online shopping
with payment gateway systems, acceptance of all credit/debit cards,
………………………, home delivery and making available national and
international recipe books.
Project Financials

Revenue Streams :

Expenditure:

Capital

O&M