SupportBiz had an exclusive conversation with Megha Deokule, co-founder of i2cook. Edited excerpts from the interview:
What is your business model? How does i2Cook work?
i2cook creates organic retail products and supplies them to stores. We also supply bulk orders to cafes and restaurants. We sometimes indulge in creating products for other brands as well.
The i2cook stores stock our products. We currently retail i2cook products in Mumbai and Bangalore. We also sell online, through our website.
Our new online store, which we plan to launch in January 2013, will not only stock our own products, but also source products from India and abroad and retail them online.
What is the background of the founders of i2cook?
I worked as an architect for three years, the last of which was at Studio Mumbai, after which I decided to quit the field altogether and take up my passion in food. I first started a blog, which was the beginning of i2cook. I then created our organic retail products like i2cook peanut butter, pink mustard and granola bars.
Pawan Deokule, the other co-founder of i2cook, has been working in the marketing domain for several years. He also runs his own digital marketing start-up. Pawan presently designs the product communication, labels, etc. for i2cook, along with costing for the products.
How did you come up with the idea of starting i2Cook?
I wished to take up my passion in food to the next level, and saw the opportunity of starting my own venture. Once the initial testing was done at a farmers’ market, and I received great feedback from buyers who thought that my healthy products had taste as well, I realized that I wanted to retail my products, most of which may be categorized as breakfast accompaniments. That is how i2cook came about.
We realized that there was a market for organic products, which were not easily available in large stores. Since we strongly believe in the goodness of organic things, we decided to set up a store which would have unique organic products that larger stores may not stock. We even sourced organic products for people who were unable to find them. A friend had a beautiful café in Bangalore, and contacted us to set up an organic store there. That is where the testing ground was established. Later, since there were re-development plans for the said property, we decided to take the store online.
How did you arrange for the initial investment that was needed to start i2cook?
Pawan brought in the initial investment to purchase raw materials and packaging material. The rest has paid for through hard work.
What are the major challenges that you face? How do you deal with them?
Organic certification is an expensive affair that raises the price of the produce. We have decided to help organic producers by doing a personal survey of their produce and checking on their intent rather than their status of certification. This is quite a time-consuming task, and a challenging one, too.
Another big worry is the number of licenses that the government is adding onto the food business. How are entrepreneurs expected to pay accountants and run between government offices, and are yet expected to grow? The government is the biggest challenge to the growth of small-scale entrepreneurs in the food business. Besides, the government has no norms or acknowledgement of organic produce as being a separate category!
How do you deal with competition from similar firms? What sets you apart?
i2cook is set apart by its taste and unique products. Most of our products are not replicable. Besides, we concentrate on products where the closest substitute is an imported bottle.
How do you market your business? How do you get most of your clients?
We used to take part in small local events, but now, we only do online marketing. The rest is word of mouth. How has the acceptance to your organic products been in India? Most of our peanut butter customers swear by it, and have said that it tastes better than the commercial ones even abroad. Our pink mustard has its own set of niche customers, while our granola bar sales are growing every day. The acceptance to our products has been good, and we are constantly working on maintaining the quality while we grow.
What do you think about the present market for bottled home-made products in India?
While consumers are happy picking bottled products, retailers and transporters are reluctant to use glass as they carry more weight and are vulnerable to breakage, leading to losses. Besides, they are not easily available to smaller producers like us.
The glass industry in India is still underdeveloped, and better quality bottles come at a large price from across the seas. The look and feel of bottled products definitely has greater appeal, and therefore, more attractive for home-made bottled products. The market for home-made bottled products was always there; we just need to get better at bottling and recycling.
How big is the organic food industry in India?
What are the major trends that you observe in the industry? I read in 2010 that the organic food market was worth USD129 million and growing. Regarding growth, the market is growing at an exponential rate. As more people move over to organic produce, the economies of scale would bring down prices, and this would help grow the market further.
We could peg the growth to the educated and affluent audience in India. There are approximately 30 million ‘smart phone internet users’ in the country, belonging to the affluent class, while there are approximately 90 million educated Indians.
Today, every departmental store either creates a section for organic produce or holds 20% to 30% of their stock in organic. As the demand for such products is increasing, retailers are being forced to stock organic produce. More and more people are trying the quality of organic produce, and making the shift.
We must remember that organic products are not new to this country. Our grandparents lived in an organic world, where they returned their glass milk bottles. They had longer life spans than our parents’ generation!
How do you think the market for organic products is likely to grow in the next couple of years?
Just like the telecom market – informed, educated and self-aware people will accept organic produce and its prices and flaws as a way of life.
What are your expansion plans?
We intend to set up a large SSI unit to process a host of organic products.
Another plan that is in the pipeline is the launch of our revamped online organic store. Also, we plan to soon make our products available in other cities of India, too.