An increase in eating out frequency, higher purchasing power and a growing customer base will drive the Indian food services market, according to a study by Swiggy and Bain & Company
India’s food delivery segment is expected to cross Rs 2.12 lakh crore by 2030, growing at a compound annual growth rate of 18 per cent, a joint report by Bain & Company and Swiggy said.
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The share of online services in the country’s food delivery market is seen rising to 20 per cent over the next seven years from 12% now, said the report released on Wednesday.
This growth is ahead of the larger food services market in India, which encompasses dining out and ordering in. The food services market is currently valued at Rs 5.5 lakh crore and is poised to grow at 10–12 per cent annually over the next seven years, reaching Rs 9 lakh–10 lakh crore by 2030, according to the ‘How India Eats’ study by Bain & Company and Swiggy.
The growth trajectory will be driven by robust fundamentals, including an expanding customer base, growing consumption occasions, and a rise in supply, the report said.
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“The Indian food services market, especially food delivery, has witnessed buoyant growth over the last few years. Higher incomes, digitisation, improved customer experience, and an inclination to try new experiences have all contributed to this growth,” said Rohit Kapoor, chief executive officer, Food Marketplace, Swiggy.
China has four times the number of restaurants per million urban population, as compared to India. This study highlights this headroom and suggests that the Indian food service market catering to middle- and higher-income segments will expand from Rs 4–5 lakh crore at present to about Rs 10 lakh crore by 2030,” he added.
The report highlighted changing eating trends, where eating out goes from a special event to a “convenient lifestyle” and the sector is set for buoyant growth backed by “shifting consumer behaviours, digitisation, and regional diversity, offers immense growth potential.”
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“Eating out is a special event for Indian consumers with an average of five times per month, which is expected to increase to 7-8 times by 2030,” said the report.
The report also pointed out that 70 per cent of food service demand is concentrated in the top 50 cities and around upper-middle and high-income segments. This segment is expected to continue bringing in demand in the medium term, along with incremental growth expected from Tier II and beyond cities as well.
Moreover, GenZ and younger groups comprise 40 per cent of the consumption group and have a higher propensity to eat out. This trend is expected to grow further as their purchasing capacity grows, the report added.
Swiggy and Bain & Company’s report noted a rise in culinary variety expectations by Indian users, as customers on average order more than three cuisines from over six restaurants on an online platform over a year.
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