Flavours Of Innovation: How These Start- Ups are Giving a Desi Twist To Sauces and Condiments According to a report by Grand View Research, the global sauces, dressings and condiments market size was valued at USD 165.81 billion in 2023 and is expected to grow at a CAGR of 5.3 per cent from 2024 to 2030

Baarish, chai, and pakode— this comforting combination is an Indian emotion, no matter where one lives. A country that loves its spices and intense flavours is sure to have a squeeze of tangy, mouthwatering sauce and condiment on the sides. Renowned for its vibrant culinary diversity, the condiment landscape in India is undergoing a remarkable transformation. The rising demand for innovative flavours and healthier options has paved the way for a new wave of start-ups to disrupt a market traditionally dominated by foreign brands such as Tops, Ching's, and Kissan.

Entrepreneur India looks at how these start-ups are not only catering to consumers' evolving palates but also reshaping traditional dining experiences. According to a report by Grand View Research, the global sauces, dressings and condiments market size was valued at USD 165.81 billion in 2023 and is expected to grow at a CAGR of 5.3 per cent from 2024 to 2030.

TAPPING INTO TRADITIONAL FLAVORS

For Sagar Merchant, being a professional chef helped him observe how the Indian consumer's palate was changing. "As the Indian food scene has evolved, people have new eating habits, global exposure to multiple cuisines and most importantly, an openness to trying, experimenting and evolving their taste buds," said Sagar Merchant, founder, Kaatil. For Merchant, the idea for Kaatil stemmed when he found gap in the cluttered condiments shelf, with no real differentiator. "We decided to put the spotlight on one common ingredient – chillies from India– which have not yet been explored in the slightest and looked to create a chilli focussed heat level-based hot condiments brand," he added.

Chillies- a staple in the Indian subcontinent- also prompted Arjun Rastogi to start Naagin to bridge the gap of celebrating Indian chillies and flavours while giving consumers something exciting and new. "India is the largest producer, exporter, and consumer of chillies globally, but the best-selling hot sauce in the country was an American product using chillies from Mexico. It just didn't add up," said Arjun Rastogi, co-founder, Naagin. He realised that while the market was flooded with generic sauces like 'Red Chilli' and 'Green Chilli', nothing encapsulated the true essence of Indian chillies in a modern, versatile way.

Case in point- in a prominent brand's 900 gm Tomato Ketchup Sweet and Spicy pouch, only one per cent of the ingredients is chilli, while 12 per cent is tomato paste. Meanwhile, in another Green Chilli sauce 200 gm packet, 50 per cent was green chilli pulp.

HEALTH-CONSCIOUS CONDIMENTS

Chandan Polekar's experience in the Hotel, Restaurant, and Café/Catering (HoReCa) sector gave him insights into consumer preferences and the prevalent presence of additives in the market. "We saw firsthand the demand for high-quality, flavorful sauces without the additives commonly found in the market. Many available sauces contain MSG, artificial colours, and preservatives, which don't align with the growing consumer preference for healthier, cleaner ingredients," said Chandan Polekar, CEO, Winn Foods. Viraj Bahl entered the market with Veeba when there weren't many condiments available in the Indian market at scale. "There was a clear gap with the evolving Indian tastes and preferences for diverse global flavours. At the same time, there was growing awareness around healthier eating, and the existing options didn't cater to this shift. We saw an opportunity to create a brand that not only brought a wide variety of authentic sauces and condiments but also delivered better-for-you offerings without compromising on taste, perfectly suited for the evolving palates of Indian consumers," said Viraj Bahl, founder and managing director, VRB Consumer Products.

CONSUMER RESPONSE AND INNOVATION

Consumer preferences have changed post-pandemic. The work-from-home model enabled people to venture into new forms of cooking. Merchant believes the pandemic exposed consumers to more brands and opened them to experimenting in all Food and Beverage (FnB) categories. Vidur Kataria founded MasterChow after being inspired by the desire to take control of what one eat and to provide confidence to home cooks, making one feel empowered to prepare restaurantquality meals at home. "Typically, preparing a Chinese dish requires ten to twelve different components, but MasterChow simplifies this process with sauces that serve as an all-in-one solution," he said.

"We have witnessed a rise in home chefs and an audience segment that is aspiring to try better products and elevate their choices…It helps the working urban millennial couples save time in cooking and gives them a quick hack to upgrade their meals," said Arjun Panwar, co-founder, Kaatil. For continuous innovation, Naagin is betting big on partnerships with Too Yum! and KFC.

Catering to unique dietary needs, Veeba offers a wide range of vegan and gluten-free products. "We have tailored products without onion and garlic for consumers who follow specific dietary restrictions, something that's particularly important in India but often overlooked in the market. This approach allows us to cater to diverse dietary needs while maintaining great taste," said Bahl.

CHALLENGES AND VC-BACKING

For Merchant and Kaatil, funding and sharing the stage with large-established brands have been key challenges. "As a product maker, timing and market stage are reasons. We have started up in a segment that is rapidly growing, going through a revolution and opening up. While the timing is great and future opportunities huge, such a segment requires a lot of education and explanation to the end user, for them to maximise the value out of the products," Merchant said.

"From a business perspective, one of the biggest challenges has been scaling up distribution in a diverse market like India, where consumer preferences and buying behaviours vary greatly across regions. Ensuring product availability in modern trade, general trade, and ecommerce channels required significant investment in logistics and building strong relationships with distributors,' said the Veeba founder and managing director. Kataria concurs, "The brand has also navigated supply chain difficulties and fluctuating demand."

In recent times, several Indian startups have successfully raised funding, reflecting a growing interest from investors in this market. The Indian sauces and condiments market was valued at USD 25.85 billion in 2022 and is expected to grow at a CAGR of 7.34 per cent over the period from 2022 to 2027. Investcorp India has previously backed Wingreens. Gaurav Sharma, partner and head of India Private Equity, Investcorp India feels the market is large and represents significant potential and headroom for growth.

THE FUTURE OF INDIAN CONDIMENTS

Rastogi feels that the Indian food condiment sector is poised for explosive growth over the next three-five years, driven by shifting consumer preferences and increasing demand for diverse, high-quality products, "With India being one of the world's fastest-growing consumer markets, there's a growing appetite for bold, authentic flavours that reflect the evolving palate of a more adventurous consumer base."

1. GROWING HEALTH CONSCIOUS: "One of the key trends we've noticed is the demand for clean-label products, free from additives like MSG which is often found in Chinese cuisine. In addition, we ensure that all our sauces are free from trans fats and artificial colours or flavours, focusing instead on delivering rich, authentic flavours through natural ingredients," Polekar said. Substances like sodium benzoate and sorbic acid are commonly used as preservatives in products like pickles and sauces. While they help maintain freshness, they do raise health concerns among consumers and can lead to issues, such as hypersensitivity, allergy and others. Global Insight Market states that taste-enhancing additives used in many sauces, such as soy sauce, alone generated over USD 81.12 billion in revenue in 2022. For Rastogi, condiments that offer health benefits without compromising taste are gaining popularity.

2. CONVENIENCE: "The demand for convenience foods is growing, particularly with urban and younger consumers who prefer quick meal solutions without sacrificing flavour. Condiments that enhance ready-to-eat or quick-serve meals are likely to see strong growth," shared Rastogi.

Other growth areas include the premiumization of condiments, the trend of fusion foods and Asian flavours, and e-commerce and quick commerce platforms. Merchant bets on pairing condiments (hot sauces, hot ketchup, chilli oils) and cooking condiments (stir fry sauces, BBQ). "Over the next three-five years, spicy condiments are expected to see significant growth, with Korean flavours leading the charge," said Kataria. "With rising disposable incomes and increasing awareness around health, the demand for better-for-you and high-quality food products will continue to grow," concluded Bahl.