iD Fresh Foods , Failures & Fame - a love triangle

A company whose founders constantly talk about their failures & how they shaped their 15-year-old journey sounded like nothing but gold to us!

Time and again, we at Finns&Marks talk about start-ups and their success stories. We talk about their journey, analyze the critical decisions they took & the impact of their decisions on the brand. Today also, we’ll talk about such a company. But what will be different? – we’ll analyze their failures!

Yes! A company whose founders talk very openly about their failures & how they turned around failures in their 15-year-old journey sounded like nothing but gold to us! It might be the enthusiasm of an IIM Bangalore alumnus or the rigor of a family that stuck together through thick and thin – but iD Fresh Foods has more lessons to teach the upcoming start-ups now than ever! Let us refer to those failures as challenges as a sign of respect for the owners of this brand who addressed them one-by-one & turned them around every time!

Before starting, let us give a small brief about the brand:

iD Fresh Foods was started in 2005 by Musthafa PC with his four cousins to provide ready-to-cook idli-dosa batter to the customers with an initial investment of INR 50,000. A story that starts from a small kitchen with one grinder, one mixer, one sealing machine, one weighing scale & a second hand scooty for deliveries went on to become a tale of 35 cities in India & Middle-East!! Let us see what it takes for this transformation to happen!

Challenge #1: Fresh Food Business means delivering Fresh Food to the table, not shops

iD Fresh Foods – as the name suggests – had chosen to enter into a market that dealt with a daily essential & a product that needs to be consumed within a particular time frame only – much like dairy products (milk, curd, etc.). The batter is made by soaking rice and daal overnight and then grinding it and packaging it the next day for sale on the same day or next day, else it goes to waste!

The biggest challenge that the brand faced since its onset was selling the product before its expiry date. In the first month, the brand used to get 90 out of 100 packages as unsold & the number remained the same for agonizing three months. It was only after 9 months that they were able to sell 100 packets a day! But at this pace, they could never grow according to their expectations. So, they decided to do what every MBA does when he is at an impasse – Pick a laptop, open an excel sheet & do some number crunching!!

Rather than resorting to preservatives to increase shelf life of their product, they preferred to give their customers what they want, when they want, how much they want. They developed a technology to capture data based on store, item, sales & wastage of food on a daily basis. This data was then used for demand predictability per store per SKU for next day & it is existing to this day with the brand having data from past 10 years about each SKU! And guess what? The brand cut down its wastage to just 2% by using technology, whereas the industry average is around 10-20%.

Challenge #2: Fresh Food Business means perishable high maintenance products

iD is not just a food business – it is a fresh food distribution business & only thing more important than delivering the food before expiry date is – delivering the food with its quality intact! While iD could ensure transportation of food in the right conditions(in chiller vans) to the retail stores, they could not monitor the last mile storage conditions. Result was puffed-up batter in the packets, that were delivered before its expiry date , but resulted in not-so-satisfactory dosas and idlis – and our personal experience tells us that it is no less than a crime in South India to have dosas/idlis made with batter of inconsistent density!

And once again, the brains of the young educated founders were on the treadmill looking for solutions in technology. Result – geotagging and geofencing of each store that they delivered to. Why? To ensure last mile traceability – monitor product shelf life and product quality at every stage of the product through IoT based solutions. This drastically reduced the number of complaints & helped them build a stronger brand.

Challenge #3: Fresh Food Business is something everyone is into!

When you live in South India and sell idli dosa ready-to-cook batter, you are not just in a red ocean – but a bleeding red ocean! Read-to-cook idli dosa batter is a very common item found in South India and it is difficult to compete with innumerable, small, unorganized players.

What do you need to do to gain trust of consumers? You start trusting them first!

And that became the USP of iD Fresh Foods – they trusted their consumers! Besides providing the batter in hygienic packaging unlike the local vendors (who sold the same in laminated packets tied with a rubber band on top!), the brand started setting up Trust Shops – world’s first branded shops with no salespersons –  installed at 37 apartments across Bengaluru, Mumbai, Chennai and Hyderabad. The firm installed visi-coolers at residential complexes, software parks and corporate offices for customers to pick up whatever they like and drop the money or even pay later if they were short of money!

 Sounds too good to be true? Well, it reaped phenomenal results for the brand with 90-95 per cent returns in some of the stores, making iD Fresh Foods synonymous with trust, tradition, and community. In the wake of COVID19, the brand went on to launch iD Trust Shops on wheels – trusting the consumer once again to pay themselves, with no follow-ups on payments from the company & the results were no different from before - more than 90 per cent of the customers made the payment online within a day & only 3% deferred the payments!

Trust on Wheels, or Trust 2.0, started in Mumbai across 500 RWA, clocked sales of INR 50 lacs with 97% collection rate. Retail sales for the same quantity would have yielded INR 40 lacs!!

“Challenges are nothing but opportunities in disguise” – we might have heard it multiple times but iD Fresh Foods really walked the talk! We can go on to talk about their expansion strategies in terms of portfolio and geographies; innovations in terms of packaging, products or marketing; & it will be never enough because this is an empire built on the experiences of 5 brothers, who once struggled for three meals a day and are now feeding millions in India, Middle East and US!!

No wonder, iD Fresh Foods did INR 240 crore business last year and expect to raise this number to INR 330-350 crore this year. Touching 30,000 outlets across their markets every day with a strong presence on e-commerce platforms, Trust had been the core value of the brand, Product the core king and Innovation the core strategy.

By: Anmol Gupta | Isha Garg

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