Unlocking Value in India’s Food M&A: The Critical Role of Operational Practice Alignment

India’s food industry, worth over $900 billion and contributing about 10% to GDP, is rapidly evolving with significant M&A activity across packaged foods, QSRs, cold chain, and nutraceuticals. The real value in food M&A comes from operational practice alignment, which drives workflow synergy, efficiency, and regulatory compliance. This article offers senior leaders a hybrid consulting approach integrating management, finance, legal, and technology to effectively manage post-merger integration and unlock sustainable growth.

Industry Overview & Context

India’s food value chain spans procurement, manufacturing, processing, warehousing, logistics, and distribution via retail, e-commerce, and HoReCa. Key M&A drivers include scaling, market expansion, product diversification, and technology adoption. For example, large conglomerates often acquire regional brands to drive growth. Additionally, they invest in nutraceutical startups to capitalise on the rising demand for health-focused consumer products. Moreover, this dual strategy helps them diversify their portfolios while tapping into emerging market trends.

Regulatory oversight from bodies such as FSSAI, MoFPI, GST Council, APEDA, and State FDAs adds significant complexity to post-merger integration in India’s food sector. Furthermore, structural trends like rapid urbanisation and shifting consumer preferences toward healthier and more convenient foods intensify these challenges. In addition, tighter regulations and increased technology adoption further heighten the need for operational practice alignment. Therefore, ensuring seamless workflow synergy and operational efficiency becomes critical for successful integration.

1. Recent Developments Impacting Post-Merger Operational Practice Alignment (June 2025)

Several developments shape the landscape for operational practice alignments in food M&A:

1. Updated PLI Scheme Guidelines:The PLI scheme actively encourages investment in value-added foods. Consequently, merged entities must align their production and supply chain operations effectively. Moreover, this operational practice alignment is essential to fully leverage the scheme’s benefits and drive sustainable growth.
2. AI-Enabled Compliance Tools by FSSAI: FSSAI’s AI-driven compliance tools require unified data governance and workflows, highlighting the need for operational practice alignment to ensure regulatory adherence.
3. QSR Sector Expansion: The QSR sector’s growth through franchising and cloud kitchens demands operational consistency across merged units. Operational practice alignments ensures uniform brand standards and customer experiences.
4. Sustainability Mandates: CPCB’s packaging guidelines promote eco-friendly process standardisation, necessitating operational practice alignment in packaging and waste management.
5. Budget 2025 Regulatory Updates: New regulations affecting food processing and warehousing increasingly emphasise traceability and compliance. As a result, merged entities are compelled to prioritise operational practice alignment during integration.

2. Key Challenges & Nuances in Operational Practice Alignments Post-Food M&A

Achieving operational practice alignments in food M&A involves navigating several challenges:

1. Input Cost Volatility:Fluctuating agricultural commodity prices frequently disrupt procurement and production planning. Therefore, implementing unified hedging and sourcing strategies becomes critical. Moreover, these strategies support effective operational practice alignment, enabling better cost management and planning stability.
2. Regulatory Complexity: Multi-layered regulations across states delay compliance harmonisation. Streamlined workflows are essential for operational practice alignments to avoid penalties and disruptions.
3. Fragmented Cold-Chain Infrastructure: Inconsistent logistics and storage facilities hinder supply chain integration. Operational practice alignments requires standardised cold chain protocols and real-time tracking.
4. Cultural and Process Misalignment: Differing organisational cultures and legacy processes often cause workflow disruptions during mergers. Therefore, proactive cultural integration becomes vital to minimise friction. In addition, it plays a key role in achieving effective operational practice alignment and ensuring long-term synergy.
5. Technology Integration Challenges: Merging ERP, IoT, and AI systems across incompatible platforms complicates integration. A clear IT roadmap ensures operational practice alignment through interoperability.
6. Workforce Adaptation Gaps:Training disparities and resistance to new processes often impede the adoption of unified practices. As a result, addressing these gaps becomes crucial for successful integration. Moreover, closing these gaps ensures smoother transitions and strengthens operational practice alignment across the merged entity.

3. Strategic Implications Using a Hybrid Consulting Lens

A hybrid consulting approach integrating management, finance, legal, and technology guides operational practice alignment for food M&A success:

1. GTM / Growth Strategy:Implement unified operational frameworks to enable scalable product launches, regional menu standardisation, and supply chain efficiency, driving market growth through operational practice alignment.
2. M&A / Investment Strategy: Target acquisitions with compatible operational processes and include KPIs like inventory turnover in due diligence to assess operational practice alignments potential.
3. Deal Structuring: Incorporate operational milestones and workflow synergy targets into earn-outs and vendor agreements to incentivise operational practice alignment.
4. Turnaround / Restructuring: Conduct operational audits to optimise SKUs and warehouse utilisation, enhancing efficiency through operational practice alignment.
5. Innovation & Tech Enablement: Deploy integrated ERP, WMS, IoT sensors, and AI-driven forecasting to unify workflows and support operational practice alignments.
6. Legal & Regulatory Strategy: Streamline compliance workflows for FSSAI, CPCB, and GST with unified traceability and audit systems to ensure operational practice alignment.
7. Operations & Workforce Strategy: To begin with, standardise hygiene and HACCP training across all units. Additionally, deploy digital HR tools to streamline workforce management. Furthermore, fostering a cohesive operationals culture is essential to achieve effective operational practice alignments and ensure long-term integration success.

Illustrative Examples

• Workflow Synergy in a Frozen Foods Merger

In one example, a merger of two frozen food producers successfully used ERP integration and AI-driven inventory planning to align production schedules, thereby cutting wastage by 18%. Meanwhile, the legal team unified FSSAI licensing to streamline compliance.

• QSR Chain Operational Alignment

Post-acquisition of a regional QSR chain, the parent company standardised kitchen operations with RFID tracking, deployed a unified digital ordering platform, and conducted joint workforce training. This operational practice alignments achieved a 22% efficiency boost and enhanced customer satisfaction.

Conclusion

Operational practice alignment is key to success in India’s food M&A, driving workflow synergy, efficiency, and compliance. Senior leaders should adopt a hybrid consulting approach integrating management, finance, legal, and technology to manage complex integrations. Leveraging LawCrust’s legal expertise helps streamline compliance and ensures seamless operational alignment, turning M&A into a powerful driver of sustained value and market leadership.

About LawCrust

LawCrust Global Consulting Ltd. delivers cutting-edge Hybrid Consulting Solutions in Management, Finance, Technology, and Legal Consulting to ambitious businesses worldwide. Recognised for our cross-functional expertise and hybrid consulting approach, we empower startups, SMEs, and enterprises to scale efficiently, innovate boldly, and navigate complexity with confidence. Our services span key areas such as Investment Banking, Fundraising, Mergers & Acquisitions, Private Placement, and Debt Restructuring & Transformation, positioning us as a strategic partner for growth and resilience. With an integrated consulting model, fixed-cost engagements, and a virtual delivery framework, we make business transformation accessible, agile, and impactful.

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