iD Fresh Food: The Complexities Of Starting A Brand Of Idli-Dosa Batter
Brand Breakdown is Shopflo’s monthly 4-part newsletter, in which we deep dive into an Indian D2C brand, and understand its constituent elements to figure out what makes it tick ⏰
When you think dosa batter, few think beyond ID. A staple in Indian refrigerators, this is a brand that took a food item that was traditionally made at home, and standardized it for the masses. This month’s newsletter series starts off with the story of 5 cousins who began a brand in a small kitchen in Bangalore.
Indians love their dosa. This South Indian breakfast staple dons many hats across the country due to its versatility. While this dish is enjoyed with just a simple sambar and chutney in the South, you will be hard-pressed to find a curry that doesn’t work with a dosa. From Mysore masala to whackier avatars that even feature a Chinese crossover, the humble dosa has seen it all.
The story begins with a school dropout who worked as a daily wage worker
A heavily fragmented and unorganized industry, till the mid-2000s, dosa batter was either locally purchased through trusted nearby vendors, or was homemade. Regional players were prominent, but they never quite managed to match the quality of the homemade version. In 2005, 5 young men in Indiranagar, Bengaluru, decided to try their hand at perfecting the batter.
Hailing from the Wayanad district of Kerala, Musthafa PC was the son of a coolie, and had dropped out of school by the age of 10 after failing in his class. A money crunch at home led him to join his father as a daily wage worker. At this point, his middle school teacher intervened and encouraged him to return to school, even tutoring him free of cost.
“My cousin Nazer had run away from home. He just wanted to get away from all the struggles,” he recalls. “I realized that to grow and make more money I needed to study and joined school again. I ended up doing my engineering from NIT Calicut”
The magic was made in a small kitchen in Bengaluru
After completing his engineering, Musthafa eventually landed a job in the US. In 2005, his cousins, who owned a small kirana store in Bengaluru told him about local vendors who sold dosa batter in transparent, unbranded pouches. After numerous customer complaints about quality, Musthafa and 4 of his cousins decided to make this batter on a trial basis.
The company was named iD- for Idli and dosa batter, and they paid a designer 2000 rupees to design their logo. Work began in a 50 square feet kitchen with 1 grinder, 1 mixer, 1 weighing machine, 1 sealing machine, a second-hand TVS scooter, and a 50,000 rupee investment.
The complexities that accompany the world of dosas and idlis dawned on the cousins once they began experimenting with the batter. “We went through multiple combinations to find the right mix of rice and urad dal by talking to customers,” remembers Musthafa. They spent nearly 6 months and 3 tonnes of rice to finally perfect their ratio, and finally, in December 2005, the batter was ready to be sold.
The plan was to sell 100 packets a day as a trial run, in the Indiranagar area. They identified 20 stores and were confident that they’d be able to achieve this target in a month.
It took them 9 months.
“In the beginning, we would supply 100 packets a day, five to each of the 20 stores, of which only 10 would get sold,” Musthafa says. They then identified 1000 stores around Bengaluru and started scaling up their operations. The profits they made were reinvested to spur the company’s growth.
From 20 stores to 6000 and beyond
What spurred the initial growth of the company was choosing to establish its own distribution teams, rather than relying on established channels. “We don’t know how they [distributors] would store our product,” says Musthafa. “And, for them, to drive growth they would put the product in each and every store, which would not be good for the brand.”
They carefully identified the stores that did not switch off their refrigeration at night, and only supplied to them (which amounted to approximately 6000 stores). The brand’s strong connection with the network of Malayali-run retail stores also worked in their favor.
By 2006, they upgraded to a 900 square feet kitchen in CV Raman Nagar, Bengaluru. Out of the 15 lakhs that Musthafa invested in building that kitchen, 6 lakhs was spent on operationalizing it. “The idea was that we will produce 2,000 kg of batter per day from that kitchen,” he says. “To our surprise, by 2008, we ended up producing 3,500 kg of batter per day.” Another 2,500 square feet factory was then set up on the outskirts of Bengaluru in 2008 to cope up with the scale.
In the middle of setting up this business, Musthafa also managed to complete a Post Graduate Programme from IIM Bangalore and joined the company full-time by 2008 (signifying the true hustle culture of Bengaluru's start-up world)
Perfecting their batter and supplying to stores was just the beginning of their journey, as the company scaled their operations from city to city, went through numerous ups and downs, found investors, and added more products to their portfolio. We’re covering all that and more in the newsletters to follow, stay tuned!
In the next edition of this month’s brand breakdown, we discuss the perils and advantages of running a fresh food business by taking a look at iD’s business model and product range.
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