New Delhi,
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When Bell landed in India in 2018, the French group, which has a turnover of 3 billion euros, started small. “We started in startup mode– recalls Bel CEO Cecile Belliot. There was one employee. » The company starts with two keywords: experiment and learn. The industrial cheese giant relies on a proven brand abroad, La Vache qui rit. Among other things, it sells bags of its star products for ten rupees (12 euro cents) in stores in Bombay and Bangalore, aimed at working-class children. To keep costs down, Bel manufactures it in Vietnam and through an Indian partner.
Four years later, the success of the experiment prompts Bell to move with speed. It formalized the joint venture with India’s Britannia on Thursday. Bell took 49% of its partner’s dairy subsidiary, Britannia Dairy, for €32m. Britain is a heavyweight in the food industry. In addition to dairy products, it sells bread, cookies and industrial pastries. Last year it achieved a turnover of 1.6 billion euros and a net income of 180 million.
“In four years, we have built a network of 5,000 sales points. There are 10 million in India. And Britain covers 60% of it.”, notes Cécile Béliot. So Bell began looking for distribution infrastructure to carve out a place for itself in this market of 1.4 billion people, which will become the world’s most populous next year, overtaking China, and where consumer habits are changing. Britain estimates that only 15% of Indian households eat cheese regularly. Consumption there is eighteen times less than in Europe. “ (circulation) our cheese activity is growing by 20% per year”welcomes Britannia CEO Varun Berry. Cecil Bellio shares his optimism. Britannia Dairy has a cheese business of around €30 million. We have an opportunity to go beyond 200 million within five years. »
Financial assistance program for industry
The two companies have invested in a plant in Britannia Industrial Estate, Maharashtra. Bel provided the technological know-how and spent around fifteen million euros on this infrastructure, which will start production in April 2024 with around a hundred employees. In addition to The Laughing Cow, Britannia Dairy will make mozzarella, which will allow it to take advantage of federal subsidies. In 2020, the Modi government launched a financial assistance program for manufacturing industries called the Manufacturing Linked Incentive.
Partnering with a local player was the only way for Bell to boost sales in India. Manufacturing costs in Europe would make its products too expensive. In addition, European cheeses carry customs duties of 30 to 40 percent. Free trade talks between India and the European Union resumed in June, but New Delhi is expected to balk at lowering its customs barriers. the Hindu fundamentalist government excluded the cheese from a treaty signed with Australia in April under pressure from Indian producers.
Source: Le Figaro
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