Akash Agrawalla shares insights on the company’s growth projections, product portfolios, future initial public offering (IPO) plans as well as the evolving spices market
Emphasising the significant potential in the whole spices market amid a consumer shift from unorganised to organised sectors, Akash Agrawalla, Co-founder of Zoff Foods, a startup dealing in premium spices, dry fruits and immunity boosters, has stated that the company is eyeing to achieve Rs 200 crore in revenue in the current financial year (FY26).
In an interview with BW Businessworld, Agrawalla noted that the company will be doubling down on enhancing its offline retail presence as well, which currently stands at around 20,000 retail stores. The company is aiming to touch the 50,000 mark in this aspect by the end of the current fiscal. Agrawalla shared insights on the evolving spices market, company’s product portfolios, growth projections as well as future initial public offering (IPO) plans.
Edited Excerpts:
There is a perception that the people in metros prefer the ‘ready-to-use’ products. Do you think this is the case, or has there been a shift?
There is only a small change. Still, the majority of consumers want to buy from the brand. They do not want to grind because they want convenience. Around 70 to 80 per cent population in India lives in tier two, three and four cities. They are not running after convenience. So, they will buy a few products in powder form, but they want to grind a few products on their own.
There are a few basic products like tamarind, chilli, and coriander that they want to grind on their own. The consumption of that product is high. It is a mix of whole consumption and grinding. That is why the whole percentage is high in the entire spices market.
Apart from spices, the company deals in dry fruits as well. How did this foray come to life, and what is the current revenue breakup?
Our ecommerce journey started in an aggressive way after Covid, and we started focusing on whole spices. Dry food consumption also increased after Covid. Dry fruits are also a part of whole food products. It is being used in its raw form. So the consumers were buying whole spices from us, even in the market, the distributors who were working in the whole spices range started adding dry fruits to their kitty.
Because the demand was increasing and consumers were shifting from unorganised to organised, we had to add dry fruits as it was going with our range. The network partners even wanted to sell dry fruits…our 15 per cent revenue comes from dry fruits.
What is your current retail presence as well as your ecommerce status? How are you planning to increase them?
We are an ecommerce first brand. Our 80 per cent revenue comes from ecommerce. We have started our offline operation from 2024-25. And going ahead, we want this to be 50-50. We will be focusing more energy, more effort on the offline part. So that by 25-26, we have a good retail presence. As of now, we are nearing more than 20,000 retail stores and want to reach around 50,000 by the end of the current fiscal.
You earlier mentioned that the current facility at Raipur is operating at 35 to 40 per cent capacity. What is the current status and how do you plan to increase that?
When we were setting up the plant, we wanted higher capacity so that whenever a scale happens, we are able to fit in there. As of now, it is running on 40 per cent, but we are growing this year. We have major plans, so probably by the end of this year we should reach 60 to 70 per cent of the capacity, and by next year we will be able to utilise the entire capacity.
What is the revenue goal that the company is eyeing this year?
This year, we are eyeing nearly Rs 200 crore.
Last year, the company also got involved in the seasonings segment. Can you share the numbers around sales and performance?
We introduced seasonings towards late 2024. We have gained good traction from it because this is another part of the spices category, and has a very niche audience. It is growing because of junk food and all, and is coming good with those Gen Z and Millennials. We wanted to have the entire range of spices. We have like four categories together, and we want to become the one point solution for our consumer
Could you break down the sales percentage of the four categories that you deal in?
Nearly 45 to 50 per cent is whole spices, 15 to 20 per cent is pure spices, 10 to 15 per cent is dry fruits and 10 to 15 per cent is blended and seasonings. Our major focus is on the whole. This is a category which is untouched and has a lot of potential. We want to redeem it and take the first mover’s advantage.
Zoff Foods has seen an increase in revenue, but there is still a decline in net profit. Can you explain the reason behind it?
In 2022-23, we were present on three to four platforms. Quick commerce came after 2023. In 23-24, we have worked on the quick commerce part. So, the spending increased. Because when you start to grow, you open different channels, your marketing budget increases and your hiring increases…So, the investment will be high for the next three years.
When you saw the number of 2022-23, there was an effort from 2018 to 2021, where we spent lots of money to get there…Now also, 2023-26, we will be spending high. Maybe our profit can decline, but our number will keep on increasing.
You raised 40 crore in the last round. Is there any plan to raise further? Can you also provide the breakup of that raised amount?
The major amount went into marketing and the development of the new channels like general trade, modern trade and marketing. Some amount went towards the working capital and some for the expenses. Some part was for the loss.
What is the status of the global expansion plans of the company?
We have just started working on that. We just hired an export manager last month. The idea is that by the end of this year, we should reach at least four or five countries. The global market is huge, and we have just started creating our base. This year, we are not projecting a very high number. The idea is to be present, start generating leads and interest from the market.
What are the plans regarding further fundraising?
We will start working on this by the end of this year. In the third quarter, probably, because we are going heavy on the offline and the marketing part. Scaling the offline part needs a good fund. The fund which we have raised was basically used to lead the marketing part, but now we want to focus on the offline sales.
Where do you see Zoff Foods in the coming five years? Any update around IPO?
We have been an ecommerce first brand. There are many legacy players whose major presence is offline. So, next four to five years, we want to dominate the ecommerce market. We want to become number one. Secondly, we want to be a top five spices brand by 2030
About IPO, because we have just reached our first round, and even the investors who have come, they want four to five years of scale. So, it will depend. But, if you ask me today, 2029-30, maybe the year when we can think of IPO.
