What is HoReCa ?
HoReCa stands for Hotels, Restaurants, and Cafes or Catering. It is a fast-growing segment in India with big opportunities for FMCG brands. It includes
- Luxury and budget hotels in cities
- Restaurants and quick-service outlets in urban and semi-urban areas
- Catering services for weddings, corporate events, and private parties
Market insights
India’s organized foodservice market is expected to reach 80 billion USD by 2025. HoReCa will make up about 45 percent of that.
Urban growth is driving HoReCa. By 2030, more than half of India’s population will live in cities. That will increase demand for hotels, restaurants, and catering.
Domestic tourism is rising. India had over 2.2 billion domestic tourist visits in 2023, which boosts restaurant and hotel business.
Why HoReCa matters for FMCG brands?
- Brings in regular high-volume orders, helping it maintain steady revenue
- Lets people try it directly in restaurants, cafés, or hotels
- Gives insights into what people enjoy when they taste them
- Helps it improve existing products or launch new flavors, drinks, snacks, and packaged foods
Types of Hotels in India That Buy FMCG Products
Hotels range from luxury chains in big cities to budget stays in smaller towns. Luxury hotels buy premium items like imported drinks, gourmet snacks, high-quality toiletries, and cleaning products. Budget hotels focus on essentials such as packaged snacks, bottled water, dairy items, and basic cleaning supplies.
A five-star hotel in Mumbai, for example, may order branded beverages and snacks every week for multiple locations. This provides steady sales and increases brand visibility. Working with hotels helps FMCG brands build loyalty with guests and corporate clients.
How Restaurants in India Use FMCG Products?
Restaurants include fine-dining, quick-service outlets, and street food vendors. They regularly buy packaged foods, condiments, dairy products, and drinks. Offering these products to customers helps brands get noticed.
For instance, a cafe chain in Bengaluru serving a packaged juice reaches thousands of customers weekly. This improves brand recall and encourages repeat purchases. Urban diners often choose branded snacks and drinks even in casual settings, giving FMCG brands a chance to test new products directly with consumers.
How Catering Services Support FMCG Brands?
Catering covers weddings, corporate events, social gatherings, and religious functions. Orders are usually large and short-term, changing with each event.
Brands can use catering to launch new products or test seasonal items since events need high volumes quickly. A wedding in Jaipur, for example, may order 1,000 beverage packs and several snack types in one day. This gives FMCG brands exposure and immediate feedback from consumers.
Importance of Sales and Distribution in the HoReCa Segment
High-volume orders are common in HoReCa. These orders provide steady revenue for FMCG brands. They help with predictable inventory planning and production schedules. They also reduce reliance on retail fluctuations.
For example, a quick-service restaurant chain in Mumbai that orders packaged beverages and snacks every day creates consistent demand. This helps suppliers plan deliveries and logistics more efficiently.
Brand Visibility Opportunities
HoReCa outlets act like showrooms for FMCG products. Every customer who sees or tries a product increases brand awareness and trust.
For example, introducing a new flavored drink in popular cafes in Pune can reach thousands of urban consumers and give immediate feedback on the product.
Challenges in Managing Multiple Outlets
India’s geography makes distribution complicated. Outlets are spread across big cities and smaller towns. Manual coordination often causes errors, late deliveries, and unhappy clients. Keeping product quality consistent at all locations is difficult.
Common Challenges FMCG Brands Face in Indian HoReCa Sales
- Manual order taking and tracking is common. Many FMCG teams use calls, WhatsApp, and spreadsheets to record orders. Mistakes and delays can lead to lost clients and lower trust. A Pune beverage distributor, for example, faced 25 percent order errors from manual entry, which hurt relationships with restaurants and small hotels.
- Managers often cannot see stock levels, sales performance, or demand trends in real time. This makes it easy to miss opportunities or have overstock or stockouts.
- Traffic in big cities and poor infrastructure in smaller towns causes delivery delays. Inconsistent deliveries reduce reliability and customer satisfaction.
- Without tools to track performance, managers struggle to identify underperforming field executives. This leads to lost sales and less accountability.
- Smaller distributors and FMCG teams sometimes avoid software because it seems complex or expensive. They need simple, mobile-friendly solutions that show clear results.
How Field Force Automation Solves These Challenges?
- Real-time tracking lets managers see visits, deliveries, and client interactions immediately. Routes can be optimized and high-priority clients reached on time.
- Orders and payments can be handled digitally, which reduces mistakes and makes operations smoother. Executives can submit orders directly through the system.
- The software works offline in smaller towns and rural areas. Data syncs automatically when the internet is available. This keeps operations running even where connectivity is weak.
- Push notifications and reminders alert executives about pending tasks, follow-ups, and low stock. This helps them engage clients proactively.
- Performance tracking lets managers see how executives perform in visits, orders, and collections. Top performers can be recognized, training can be provided, and incentives set for Indian teams.
Benefits of Automation for FMCG Brands in HoReCa
- Automation helps ensure orders are accurate and deliveries are on time. This is important in India’s FMCG market where delays can hurt trust.
- Managers can get real-time updates to meet client needs and solve issues quickly.
- Sales and targets are easier to track by region, city, or individual executive. This supports faster decision-making and growth in new markets.
- Recognition, incentives, and feedback motivate field teams and improve productivity. Automation also encourages accountability across Indian teams.
Real-Life Example from the Indian FMCG Market
A mid-size FMCG brand worked with 250 HoReCa clients across Mumbai, Pune, Jaipur, and Ahmedabad. They faced frequent order mistakes and late deliveries. Managers had little visibility into field executive activities. Managing multiple outlets in tier-2 and tier-3 cities was challenging.
After using field force automation, order errors dropped by 35 percent. Delivery efficiency went up by 40 percent. Managers could track, motivate, and train their executives more effectively. Offline order entry and automatic data sync helped operations in smaller towns.
The result was stronger client relationships, smoother operations, and higher revenue.
Future Outlook HoReCa Growth and FMCG Opportunities in India
Urban growth is increasing demand for restaurants and hotels. More people living in cities means more meals consumed outside home. Tourism is also growing, which drives catering and hospitality services and creates steady demand for FMCG products.
Consumers in urban and semi-urban areas are dining out more and choosing ready-to-eat foods. HoReCa lets FMCG brands test new products and flavors before launching them widely.
Technology is becoming standard in FMCG operations. Mobile apps, analytics, and automation tools help brands improve deliveries and field team performance. Brands that adopt these tools early gain a clear advantage.
What’s Next?
The Indian HoReCa segment offers strong potential for FMCG brands to grow revenue, reach more clients, and boost brand visibility. Operational challenges like manual errors, delivery delays, and field team monitoring can be solved with digital tools.
Managing HoReCa operations can be simple. Happisales helps your team track orders, monitor deliveries, and engage clients efficiently. Stay on top of inventory and keep your team focused on growth. Start a 14-day free trial or request a live demo today to see it in action.
Frequently asked questions
1. What is the HoReCa segment in India?
HoReCa means Hotels, Restaurants, and Catering. It’s a growing foodservice market offering FMCG brands bulk orders, customer exposure, and product testing.
2. How do FMCG brands benefit from HoReCa?
Hotels and restaurants provide steady sales. Customers trying products in cafes or hotels may buy again. Catering spreads awareness at large events.
3. What challenges do FMCG brands face in HoReCa?
Manual orders cause errors. Deliveries are delayed. Tracking sales across outlets is hard. Managers struggle to monitor field teams without tools.
4. How does automation help HoReCa distribution?
Automation cuts order mistakes and speeds deliveries. Digital tools show real-time stock and order status. They improve client satisfaction and team tracking.
5. What’s the future of HoReCa for FMCG in India?
Urbanization and tourism drive demand. Consumers eat out more, favoring ready-to-eat foods. Technology helps brands manage operations and grow faster.