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An approach note for fruit based Confectionery

Group 9

Anjana Rao- PGPM508_36Suraaj Doshi - PGPM508_08

Ajit kumar- PGPM508_20

Gagan Seth - PGPM508_44

Chandra Verma - PGPM508_56

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Case FactsPilot Study in Maharashtra

Brand grew 20% in Maharashtra overits sales in previous quarter (Jan Mar)

Key StrengthsDemographic Advantages

3rd largest State by Area

2nd largest population base in the

country (around 100 Million)Diverse population mix(countrywide and urban-ruralsegment)

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Industry Analysis - Confectionery

y One of the largest and well developed among foodprocessing sectors

y Market Size in India - Rs25 00Crores (60% Urban)y 30% Chocolate based and 70% (Sugar and others)

y Highly competitive, low margin and high volumemarket

y Indian Confectionery market is forecasted to increaseby 10% for next 5 yrs

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Marketing strategy

Price -

Competitive FMCG Market

No Price IncreasePricing

Strategy

everage existingistri tion c annel

istri tionC annel

Place /Distribution

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Marketing strategy

Promotion

Dedicated budget for

New Ad CampaignAdvertising

Push strategy and

repositioning

Promotion

Strategy

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Strategic 3Cs for Confectionary market

The strategic 3Cs Customer , Competitors, Cost

Customer Price Sensitive

Wants a highly differentiated product to pay a higher price

Useful to target the segment offamilies with children andcollege-goers

Cost The costs will increase due to the additional features added to

the product (re-branding)

But if the sales volume go up then economies of scale can beachieved in order to attain cost effectiveness

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PLC - Extension of the mature phase

In the Confectionary market products seem to enjoy very longmaturity, if not immortality, with no signs of decline.Marketers to prolong the profitable mature phase for as long aspossible , using a range of extension strategies.Extending the product life span is the goal of many firms.

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Key Facts:

Confectionery Market Size: Approx. Rs. 2500 crore

Growth Prospect: 10% compounded annual growth

Sugar Based and related: 70% of the share =approx: Rs. 1750 croreExpected Market = Rs. 1925 crore

We aim for a market share of 3%

So expected sales= Rs. 57.75 crores

Product average price= Rs. 3

Average Cost= Rs. 2.5

Volume Sales= 19.25 crores units

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The volume estimates seem to be feasible considering the fact that

around 60% of the sales will be achieved from the urban market.

Overall Profit = Rs. 9.625 crores

CAAGS consultants gives a Go Ahead to sanction Rs 2 Crores

budget to the confectionery company

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Thank You