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The rise of Hyderabad’s bakery market

Hyderabad, the city of Nizams popularly known for its palaces and touristic destinations, has been interestingly, celebrated for its cuisine across the country and globally too. Apart from the perennial favourites – Hyderabadi biryani, Hyderabadi Haleem, and varieties of Irani chai, the city is also famous for its bakeries which have been rolling out tonnes of Osmania biscuits, Nan Khatai and Bun Maska for decades. Akshay Nayak delves into the bakery market in Hyderabad to uncover its secrets

Ashish Seth

The Hyderabad bakery market has evolved greatly over the last decade but still has been able to preserve its rich culture. Multiple large bakery chains have emerged alongside the numerous standalone bakers operating in the streets of Hyderabad. This is the view expressed by Ashish Seth, MD India, area director South Asia, Puratos Food Ingredients India. He adds, “Availability and adoption of new technologies have led to a paradigm shift wherein bakers have moved from manual work to mechanised processes to create their offerings. As Hyderabad is rapidly becoming one of the bigger business hubs of India, people from different parts of India and the world are coming to the city and the bakers to cater to this new audience have also added a variety of products such as cakes and pastries along with the traditional bread and biscuits. Snacking finished applications have also found their way into the bakeries with the introduction of tea and coffee vending machines.”

Pankaj Jain

According to Pankaj Jain, GM – marketing, sales & culinary at Rich Graviss Products, Hyderabad traditionally has been a great market in terms of baked goods like cookies and puffs. The fruit biscuits and Osmania from Hyderabad are world-famous. “Even the egg puff is a unique creation of this city wherein they put a whole hardboiled egg inside a puff pastry,” he shares.
This market is now developing beyond just biscuits and puffs, into a matured patisserie market. Bakeries are offering delectable cakes, desserts, and chocolates. Some names driving this trend are 5th Avenue Bakers, KS Bakers, Café Niloufer & Bakers, and Swiss Castle, added Jain.

Sandeep Reddy

Sandeep Reddy, MD, KS Bakers says that the bakery segment in Hyderabad has been an integral part of food consumption. Agreeing to Jain’s views, Reddy said, “The food industry has evolved as per the lifestyle of the people and also with the changing food habits. We are happy to state that the legacy products are still a part of the menu. Initially, the bakery market was developed by late Nizams with their passion for baking. Major manufacturing of products then involved were khari, dilkush, dilpasand, Osmania biscuits, cream roll, fine biscuits. The market evolved with the latest technology and products. Migration of people was the major push for this change and the necessity for new inventions came into picture which further added to the increase of many new bakeries.”

Challenges & opportunities in preserving the legacy
Hyderabad is rapidly becoming the next business hub in India; real estate costs are also increasing. This poses a challenge for the bakers as the rentals for their bakeries are also increasing which adversely affects their profit margins, opined Seth. “To cater to the influx of people moving into the city multiple bakeries are popping up, creating a highly competitive market, which can also be perceived as a challenge. The sudden rise in bakeries also leads to a fresh challenge which is sourcing skilled staff as the supply is a lot lower than the demand,” he observed.
On the flip side, opportunities in this sector are also many. With bakers becoming more cognizant of flavours and concepts from around the world, bakers and chefs are valuing innovation and creativity in product formulations which in turn is evolving the market, said a positive Seth. The influx of people also presents an opportunity for skilled workers, home bakers and women entrepreneurs who are building their enterprise and are earning a good living. According to the Taste Tomorrow survey conducted in 2019, consumers in India love both traditional as well as exotic tastes from across the world. The evolving palate of the consumers warrants innovation in the product offerings by the bakers, but this does not imply that the consumers do not want to consume the traditional age-old flavours in the finished applications.
The major challenge for Hyderabad bakeries, as per Reddy, is to maintain the heritage of Nizami style recipes and also to match the latest trends. There have been huge opportunities due to increased demand for baked products due to globalisation. “We try to preserve our flavours keeping in mind the quest for international tastes in the products. We try making things in Indian styles by mixing international recipes with local fusion. This gives the public a feeling of their cultural style which even matches the global styles,” he added about how KS Bakers has evolved in the Hyderabad bakery market.
Explaining the reasons behind the shift in the palate of residents in Hyderabad, Jain said that the city like any other metro city is fast growing into a complete cosmopolitan hub. The IT sector is catalysing this change. So, the demand for premium baked goods, cakes and desserts is on the rise. This represents a great opportunity for the bakeries in the city to revamp their repertoire and offer contemporary premium goodies to this new-age consumer group. Those who are aligning to this change are reaping the benefits and are paving the way for other traditional artisanal bakeries to upgrade.

The way ahead
As per Reddy, the current trend in this industry is to get products which are much healthier and fresh with a better shelf life. Online ordering of the products due to apps like Swiggy, Zomato, etc have given a major boost to the consumption because of the convenience people get with these.
Jain feels, the growth in income levels of the average household and the exposure to international media is driving premiumisation of the menu across the board. European trends like mirror glazes, cheesecakes and mousse cakes are catching on. Cakes are fast moving into the space of desserts and is not just a birthday buy anymore. This demand is influencing the bakers to develop small portions, new flavours and exquisite garnishing.
“Conclusions drawn from the recently conducted Taste Tomorrow event, show that taste has become the most important criteria for consumers when buying bakery products. They like both traditional tastes and exotic tastes; becoming more experimental with their food choices. Having said this, consumers are now consciously seeking healthy and natural alternatives which finely balance the nutritional benefits without compromising on the taste aspect. Going ahead, we anticipate more and more consumers to move towards healthy eating as a way of life. Another fast-growing consumer trend is that of convenience. With the current fast-paced life, every individual yearns simplicity in their food experience; be it ordering online or quick deliveries, convenience is the name of the game,” concluded Seth.

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