When Soumyadeep Mukherjee was about to turn 40, he wanted to start his own business. Through his corporate stints through Hindustan Coca Cola Beverage Pvt. ltd. and Danone Narang Beverages over the years, Soumyadeep watched his friends start their own business, but his ideas never turned into real projects.
“No one in my family has ever owned a business. But I realized, abhi nahi karunga toh kabhi nahi karunga (if I don’t do it now, then I will never do it)”, says Soumyadeep (Som) Your story.
Having traveled and worked in various countries, he had witnessed the demand for Indian food. Therefore, he explored the hot sauce market as there were not many immediate competitors. But then he realized that the Indian chutney category is an all-white space and decided to enter the market with Spice Story in 2019.
Managed by Globalvalue Food and Condiments Pvt. Ltd., the Mumbai-based startup manufactures indian ethnic chutneys in the form of a sauce and packages them in bottles.
Soumyadeep has appointed Gayatri Gogate as Head of Branding and Marketing in 2020 who is also the co-founder of the company. Spice Story has an eight-member team.
Initially launched in Kolkata and sold in six stores run by Spencer Retail, the startup has now expanded to six cities including Delhi, Mumbai and Chennai in 300 modern commercial stores.
Taking inspiration from sandwich stalls in Mumbai, the entrepreneur started by launching green chutneys, and also launched tamarind chutney, which is a common taste with Indian snacks like Samosa and Pakora.
Mumbai-based brand takes inspiration from local chutneys across India
While chutneys are perishable goods, Som and his team took the time to find a production method to increase the shelf life of the products.
“In commercial production, chutneys are cooked at over 100 degrees and then pasteurized. When cooked and sealed at such a high temperature, unless the bottle is opened, the product inside will not be spoiled,” says Som.
Some of Spice Story’s products contain their own preservatives such as lemon, sugar, salt, and jaggery, which are also commonly used to preserve pickles.
Job and challenges
The startup sells its products through a combination of offline and online channels, with e-commerce accounting for around 40% of its revenue.
Currently, Spice Story offers 12 products, which are available in 1,200 general trade stores in Bengaluru and Mumbai. The prices of the products are between Rs 149 and Rs 400.
The brand also sells on online marketplaces such as Amazon and Flipkart, and quick commerce platforms such as Swiggy Instamart and Zepto.
“In the beginning, when we started, our online sales were in the single digits, as we were trying to establish ourselves on a limited budget. Here, modern commerce works better. So we weren’t focusing much on online sales. But now we want to increase the numbers,” says Som.
Although the founder did not specify the initial investment in the venture, Spice Story has so far raised Rs 3.4 crore in funding from Venture Catalysts, Nafa Capital, Ventureland Asia and Maxar.vc, among other angel investors.
The startup generated sales of Rs 97 lakh in the 2019-20 financial year. But once the pandemic hit in March 2020, things took a different turn.
“Although our sales were not affected much by the relatively faster opening of modern trade stores, our production was extremely hampered,” says Som.
The company had third-party manufacturers in Mumbai and Indore. Due to the migration of workers to their hometown, the Mumbai production plant was at an all-time low.
“Once the lockdown opened in July 2020, we had orders, but we had no one to manufacture as most workers had left and production went down due to a labor shortage. The time to get a product within 7 days has increased to 25-30 days,” he adds.
As the brand was unable to meet the growing demand, it ended up losing business and ended the 2020-21 financial year with revenue of Rs 1.5 crore.
The brand competes with FMCG giants like Dabur and tobacco company ITC, which have experimented in this category.
And then ?
Going forward, Spice Story plans to roll out new products, one of which is coconut chutney, which took the team more than six months to develop.
“We are now keen to develop general trade in the same cities as modern trade. Our goal is to grow 25X over the next three years. We want to multiply this fiscal year by 3 and add three more cities in the next fiscal year,” says Soumyadeep.
The brand, which entered the United States via Amazon, also plans to venture into the United Kingdom and the United Arab Emirates.