Sweets up 10-20% as modak sellers battle shrinking margins

As Ganeshotsav boosts the demand for sweets and modaks, sweet shops and home-based sellers in Pune are facing rising raw material costs, leading to a 10-20% increase in prices for various sweets. Higher costs for key ingredients like sugar, milk, and dry fruits are driving this price hike, with established sweet shops passing on part of the increase to consumers while smaller businesses struggle to absorb the costs, resulting in shrinking profit margins.

Sachin Gadve, director of Kaka Halwai Foods Pvt Ltd, noted that prices for sweets have risen by around 10-20% due to the increase in raw material prices. He also warned that further price pressures may arise if rainfall conditions negatively impact agricultural production, particularly sugarcane and other crops needed for sweets.

Store owners face the challenge of balancing higher input costs with customer price sensitivity, with some seeing a decline in sales due to modest price increases. The impact is especially acute for small, home-based modak sellers, who lack bulk procurement arrangements and must buy ingredients from retail outlets as orders come in, leading to higher costs and shrinking profits.