Market Outlook: Catering Services in India

Catering services in India are dominated by unorganized players, but recently, the organized operators comprising of the top international catering companies are making efforts to improve their capabilities through mergers and acquisitions.

catering services in India

Market Drivers and Constraints

Buyers are becoming more conscious about food safety and health at the workplace and are looking to have a balance of premium customized food offerings and healthy eating options, which do not affect the budget by much.

Drivers

  • Employers are starting to look at employee dining as a tool to attract and retain talent. Competing for the best and brightest employees and retaining them over a period are challenges that companies are looking to address by offering them tempting food perks, which create an instant attraction and experience that binds the employee to the place
  • Rising demand for customized food: India is a country wherein the tastes and cuisines change almost every 500 km, on an average, and considering the mobile workforce, buyers are looking to customize the menu as per their audience and include items beyond the regular local cuisines to create a sense of value in the mind of the employees
  • Growing awareness toward healthy eating: With increasing levels of stress and related health issues among the general workforce, employers are looking at ways to ensure that the workforce remains healthy. This has increased the demand for onsite dining services with healthy and fresh menu to ensure that the employees are at the best of their health and perform their best

Constraints

  • Food safety: Since the market is controlled by the small local players in the unorganized sector, compliance to regulatory norms and required SOPs are major issues, which is withholding further growth in the segment
  • Price sensitivity among buyers: Buyers in India still mostly look at employee dining as a cost rather than a benefit or investment, and hence, do not want to spend anything more than that is necessary. This hampers the engagement and the growth over a period
  • Not a homogenous market: India is a very diverse country, and hence, what works in one place may not work in another