Is Country Delight Profitable? Financials & Business Model

Country Delight, an Indian company famous for its fresh and unadulterated milk has been making waves in the milk & grocery delivery market. Reason? For its financials and business model. People out there are wondering- Is Country Delight profitable? 

Unfortunately, despite operating for over a decade, Country Delight hasn’t shown any profitable growth so far. However, the founders are certain that Country Delight will soon boast its profitable financials in the upcoming fiscal years.

Another question that may pop in your mind is- Why couldn’t Country Delight become profitable? 

To answer that, we need to dive into the Country Delight business model. Then we will be discussing the financials of Country Delight thoroughly. 

So, without any delay, let’s begin our discussion!

(A) Country Delight: Profile Overview

Country Delight is an Indian online platform that brings fresh milk and groceries straight to your doorstep. 

They deliver a range of products including dairy, fruits, vegetables, and other kitchen essentials. What makes them stand out is their integrated supply chain model. This means they source their products from trusted partners and ensure that these items are minimally processed and quality-tested. Remarkably, these essentials are delivered to customers within just a few hours of being sourced.

Founded in 2013 by Chakradhar Gade and Nitin Kaushal, this service operates in over 18 cities across 11 states in India.

Let’s briefly look at the profile of Country Delight-

Note: Do you know the Reliance Retail and Milkbasket merger was a classic failure? The milk startup witnessed a breakthrough success initially, but soon it landed on a topsy-turvy journey. We have already explained this saga in our article “How Did Reliance Funded Milkbasket Fail? The Merger & It’s Side Effects.” Go through it for detailed information.

(B) Working Strategy: How does Country Delight work?

Country Delight is a startup with a clear mission: to bring natural, fresh, and minimally processed food essentials directly from farmers to your doorstep. Here’s how they make it happen-

(B.1) Tech-Driven Approach

Country Delight uses technology to streamline its supply chain from farm to home. Here’s how-

• Supply Chain Optimization: They select farms known for good hygiene practices, efficient cold-chain management, and the use of advanced technology for milking. This ensures that the milk and other products are of the highest quality.
• Quality Control: Each product category has its own quality control procedures. This means you get fresh, quality-tested products delivered directly to your home.
• Traceability: One of the biggest challenges in the food industry is traceability—knowing where your food comes from. Country Delight uses technology and cold storage facilities to track products from the farm all the way to your home.

(B.2) Customer-Centric Approach

Country Delight places a strong emphasis on customer satisfaction-

• Daily Deliveries: They deliver natural essentials every day. This means you always get fresh products, unlike traditional suppliers who may take longer.
• Direct Sourcing: By buying directly from farmers, they cut out the middlemen. This helps maintain product quality and keeps costs lower.
• Consumer Stickiness: Providing high-quality products directly to your door helps build customer loyalty. Once you try their fresh, minimally processed products, you’re likely to stick with them.

(B.3) Focus on Milk and Staples

Country Delight started with milk delivery and then expanded to other daily essentials-

• Milk: Despite stiff competition from big names like Mother Dairy and Amul, Country Delight has focused on delivering high-quality milk directly to consumers, setting them apart.
• Expansion to Essentials: They didn’t stop at milk. Now, they offer a range of daily essentials, all with the same commitment to freshness and minimal processing.

(B.4) IoT Integration

The team at Country Delight has also started integrating Internet of Things (IoT) technology. This enhances their ability to monitor and manage processes efficiently, ensuring you get the best products possible.

Country Delight’s success is built on a foundation of technology-driven supply chain optimization, daily deliveries, direct sourcing, and strict quality control. They’ve disrupted the traditional milk and staples delivery market, encouraging people to choose healthier, fresher options for their daily needs.

(C) Revenue Sources: How does Country Delight make money?

Country Delight generates revenue through various channels. Some of the major ones are-

(C.1) Sale of Fresh Milk

The primary revenue source for Country Delight is the sale of fresh milk. They source this milk directly from farmers and deliver it straight to customers’ doorsteps. In the financial year 2022, revenue from fresh milk sales alone amounted to Rs.368 crore. 

(C.2) Other Dairy Products

Beyond milk, Country Delight offers a variety of other dairy products. These include curd, paneer (cottage cheese), ghee, and eggs. These products add significantly to their overall revenue, catering to a wide range of dairy needs.

(C.3) Groceries & Farm Produce

Country Delight also supplies a variety of other essentials, including groceries, fruits, vegetables, and bakery goods. These additional offerings broaden their revenue streams and provide customers with a one-stop shop for fresh, natural food essentials.

As you can see, by diversifying its product range and maintaining a focus on quality and freshness, Country Delight successfully taps into multiple revenue sources, ensuring steady growth and customer satisfaction.

(D) Financial Status: is Country Delight Profitable?

Since starting, Country Delight has grown significantly. By the financial year 2022, the company achieved an approximate revenue of Rs.600 crores, capturing about 2-3% of the market share in the milk segment. This dairy tech startup earned approx. Rs.900 crore in FY23. Also, they posted Rs.650 crore sales in the first half of FY24. 

(D.1) Country Delight’s Financial Breakdown

Country Delight saw a huge jump in its scale, growing nearly 70% and surpassing Rs.500 crores in revenue by the end of March 2022. However, during the same time, their losses increased significantly, multiplying by 6.6 times.

To be exact, their operating revenue climbed to Rs.543 crores in FY22, a 69.2% rise from Rs.321 crores in FY21, as reported in their annual financial statements from the Registrar of Companies.

Currently, Country Delight operates in more than 25 cities. Also, its user base and partners have expanded to 6,00,000 and 10,000 respectively.

(D.2) Revenue Breakdown

Fresh milk, the main product of Country Delight, made up 67.8% of their total operating revenue, increasing by 46% to Rs.368 crores in FY22. Sales of groceries and other dairy products like paneer, curd, ghee, and bread also saw a significant rise, growing 2.5 times to reach Rs.175 crores in FY22.

(D.3) Expenses Breakdown

The cost of sourcing products made up 49.3% of their total spending, jumping 86.6% to Rs.362 crores in FY22. Advertising and promotion expenses increased fivefold to Rs.125 crores. Employee benefits and contract labor costs also saw significant hikes, rising 76% to Rs.67 crores and doubling to Rs.74 crores, respectively.

Additionally, the company spent another Rs.42 crores on packaging and shipping, bringing their total expenses to Rs.734 crores in FY22, which is 2.1 times higher than the previous year.

(D.4) Is Country Delight profitable?

No! In FY21 and FY22, Country Delight was not profitable. It was drowned in losses of Rs.28 crore and Rs.186 crore respectively. Moreover, its losses increased by 107.3% in those two fiscal years.

By looking at the financial statements of FY21 and FY22, you can say that Country Delight spent Rs.1.35 to earn a rupee of its operating revenue.

What about the last two financial years i.e. FY23 and FY24? You may ask.

As of now, the company hasn’t filed its audited financial statements for FY23 with the Ministry of Corporate Affairs. Hence, we can’t expect the financial data for FY24 either…

(D.5) Latest Data for FY23 and the First Half of FY23

Country Delight has shown impressive growth, with its revenue jumping to Rs.900 crores in FY23, a 66% increase from the previous year. Despite this, their net loss figures for FY23 aren’t available yet, but they had a significant loss of Rs.186.4 crores in FY22.

(E) Marketing Strategies: How Country Delight rose to fame?

Country Delight has successfully made a name for itself in the food essentials market through a blend of strategic quality control, technology adoption, and customer-focused initiatives. 

Let’s go through the details of its marketing strategies that helped it to gain fame in the market-

(E.1) Winning Customer’s Trust with Quality Control & Local Farm Partnerships

• Local Farm Partnerships: Country Delight partners with over 250 small and medium-sized dairy farms across India. This direct partnership ensures that products come straight from local farmers, enhancing quality control.
• Rigorous Testing: They implement stringent quality control measures to maintain high product standards and safety, ensuring that consumers receive fresh and reliable food essentials.

(E.2) Tech-Driven Marketing Approach

• Supply Chain Management: Leveraging technology, Country Delight ensures efficient supply chain management, which helps streamline operations and build customer trust.
• Digital Marketing: The company uses SEO (search engine optimization), email marketing, and social media to promote products and create brand awareness.
• Influencer Collaborations: By collaborating with wellness and health influencers, Country Delight endorses its products and educates customers about the benefits of fresh dairy consumption.

(E.3) Consumer-Centric Strategy

• Direct Delivery: Country Delight’s model of delivering natural, fresh, and minimally processed food essentials directly to customers’ doorsteps has disrupted the traditional delivery business.
• Building Loyalty: Focusing on high-quality products with minimal processing has fostered strong consumer loyalty and stickiness.

Country Delight’s rise to fame can be attributed to its commitment to quality, innovative use of technology, and a strong focus on customer satisfaction. By directly sourcing from local farms and leveraging digital marketing strategies, they have established themselves as a key player in the direct-to-home (D2H) market for food essentials.

(F) Challenges Faced

Country Delight, despite its impressive growth, faced several significant challenges along the way. Some of the major challenges were-

(F.1) Maintaining Quality Control

Ensuring that their milk and other dairy products were always fresh and of the highest quality was essential for Country Delight. With a strong emphasis on delivering natural and minimally processed products, they had to implement rigorous testing and maintain strict quality standards. This was crucial to gaining and retaining customer trust.

(F.2) Logistics and Delivery

Delivering fresh milk directly to customers’ doorsteps required a highly organized logistics and delivery system. Country Delight had to tackle multiple logistics issues, such as ensuring timely last-mile delivery and managing the costs associated with acquiring new customers. They integrated their supply chain with advanced technology and developed scalable solutions to streamline operations and improve delivery efficiency.

(F.3) Competition from Established Giants

Entering a market already dominated by big names like Mother Dairy and Amul was no small feat. Despite the fierce competition in the Delhi-NCR region, Country Delight’s youthful confidence and determination fueled their belief that they could disrupt the industry. They focused on offering a unique value proposition of fresh, high-quality products delivered directly to consumers.

(F.4) Cattle Management

In the early days, managing cattle was a significant challenge for Country Delight. Milk production was unpredictable, and they initially struggled with the complexities of handling the animals. They had to find innovative solutions and adapt quickly to ensure a steady and reliable supply of milk.

(F.5) Capital Constraints

As a bootstrapped startup, Country Delight had limited capital. This financial constraint forced them to make strategic decisions to maximize their resources. They chose to focus on the milk business, which offered built-in safety and predictability, allowing them to manage their limited capital more effectively and ensure steady growth.

(F.6) Fragmented Market and Unorganized Players

The dairy market in India is largely unorganized, with over 60% of it consisting of fragmented logistics and inconsistent product quality. Country Delight aims to address these challenges by providing consistent quality and a variety of products. They differentiated themselves from traditional retail channels by offering reliable, high-quality dairy products directly to consumers.

(G) Overcoming the Challenges

As you have read above, Country Delight encountered numerous challenges. But they didn’t give up. Instead, they tackled those challenges in the following ways-

• Persistence against Giants: Despite facing stiff competition from major players like Mother Dairy and Amul, Country Delight started as a bootstrap venture in Delhi. Their determination to enter a competitive market and offer something unique helped them gain a foothold.
• Vision & Growth: The founders, Chakradhar Gade and Nitin Kaushal believed in the growth potential of milk production and saw the opportunity to build a dedicated customer base. This vision sustained their growth and motivated them to persevere despite the challenges posed by established competitors.
• Scaling Strategy: Their journey exemplifies the importance of prioritizing quality, technology, and customer satisfaction in scaling a business. Instead of relying solely on heavy advertising, Country Delight emphasizes building a strong foundation based on these principles, setting them up for long-term success and potential expansion into public markets.

(H) Wrap-Up

In a nutshell, Country Delight is on its way to profitability, thanks to its fresh approach and focus on quality. Despite facing hurdles, their financials and working strategies suggest a promising future, aiming for profitability by 2024-25. 

By keeping customers happy and embracing technology, Country Delight is set to thrive in the food essentials market. What do you think about Country Delight’s journey to profitability? Share your thoughts in the comments below!