Freshtrop Fruits Ltd, an exporter of grapes and pomegranates, plans to bolster its presence in the domestic juice market. It is planning to invest around ₹100 crore for communication and brand building of its cold extracted juice brand Second Nature in a bid to increase the turnover from ₹2 crore this year to ₹100 crore by 2023.
“We think the domestic market has a larger potential. This was a direction that we took for us to grow as a company,” said Dipti Motiani, founder and Chief Product Officer, Second Nature.
The company’s grape export business has been growing consistently at around 10 per cent year-on-year for the past four-five years, she said. Considering that the domestic economy is growing at a faster pace, she sees a potential in both B2B and B2C segments of the domestic market.
The company is working out different logistics models for maintaining supplies in the domestic market for Second Nature, which started sales in March 2018. The company is also targeting ₹15-20 crore in 2019-20 from Second Nature and plans to spend ₹15 crore in research and development over the next five years.
Expansion plans
FreshTrop, which focusses primarily on exports to the European supermarkets, had invested around ₹30 crore in Second Nature. Second Nature marked the company’s first foray in the domestic and the B2C market since its incorporation in 1992, as well as its advent in the cold extracted juice category. Freshtrop had a turnover of about ₹175 crore last year and expects a total revenue of ₹190-₹200 crore this fiscal.
Second Nature is currently available in Mumbai, Nashik and Pune, with the company planning to expand to Hyderabad, Bengaluru and Delhi this fiscal year.
The company is now focussed on setting up and testing the supply chain for Second Nature. It is the requirement of maintaining the drinks at 2-4 degrees that acts as a constraint in its expansion plans, said Motiani. The requirement of a cold chain facility and the shelf life of 30 days as compared to the six month shelf life of a cardboard-carton juice also adds to the cost, she added.
Second Nature brand, which has four categories under it, has no preservatives, sugar, colours and flavours and is devoid of the heat treatment which otherwise denudes juices of its taste and nutrition, she said. The process of making cold extracted juice also involves the HPP, or high pressure pasteurisation process. The use of fresh fruits and the dearth of concentrates also adds cost vis-à-vis tetra pack juices, she said.
“We have chosen this cold extraction technique because we want to remove the skin and the seed and keep everything else, and still make the texture smooth and palatable,” she said. Freshtrop’s processing unit in Nashik currently has a capacity of around 10 tonnes per day for Second Nature.