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Sales Strategy to Market Parle G in Rural Market

Group No. 1

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The total production of biscuits in India is estimated to be around 30 lakh Metric Tons

Indian biscuits category sums upto Rs 11,295-crores

The biscuit industry is estimated to grow over 15-17% in the next few years

The per capita consumption of biscuits in India is 2.0 kg

Th e Nielsen study 2011 states t h at India is t h e world's leading market for biscuits, a h ead of th e US, Mexico, C h ina, Argentina, France, Italy, Germany, Turkey and Spain. W h ile Indiash owed a volume market s h are of 22%, t h e second slot was occupied by t h e US at 13%.

The export of biscuits is approximately 17% of the annual production, the export of sweetbiscuits for year 2007-08 was Rs 145.93 Cr and for year 2008-09(April-Dec) was Rs 280 Cr, the

major exporting regions were Haiti, Angola, USA, Ghana, UAE

The B iscuit industry employs almost 3.5 lakh people directly and 30 lakh people indirectly.

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This industry is further divided into two; organized and unorganized sectors.

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Here the organized sector comprises of 65% whereas the unorganized sector is 35%

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The organized sector is valued at above Rs 8000 crores

The organized biscuit manufacturing industries annual production: Year: 2006-2007Production: 16.14 lakh MT

Year: 2007-2008Production: 17.14 lakh MT

Year: 2008-2009Production: 19.15 lakh MT

The organized sector face competition to the unorganized sector even though the percentageratio is less

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Here the major consumption happens in East -28% followed by North-25%and then South-24% and West-23% being the lowest.

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The biscuit industry is further divided into the following categories

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Glucose Marie Sweet

Salty Cream Milk

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Market share- Brand wise (volume )PARLE 40%

BRITANNIA 38%P RIYA GOLD 15%

ITC 11%

REST 6 %

from report s available at IBMA ( Indian Biscuit Manufacturers Association) Fig 2007-2008

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Parle G is one product that we all have consumed at least once.

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So who gets these tasty biscuit to us?

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A very familiar company called the Parle Products Pvt. Ltd.

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Parle Products has been India's largest manufacturer of biscuits and confectionery for almost 80years, Since 1929.

Parle name symbolizes quality, nutrition and great taste

Makers of the world's largest selling biscuit Parle-G

They have factories in Mumbai, B angalore, B ahadurgarh in Haryana and Neemrana in Rajasthan.

With a 40% share of the total biscuit market and a 15% share of the total confectionary market inIndia, Parle has grown to become a multi-million dollar company.

The great strength of Parle Products is the extremely widespread distribution network; even atthe remotest places

Currently, Parle Products has over 33, 00,000 distribution outlets.

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The product that gained Parle products name, fame and popularity

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Parle-G

The largest selling biscuit in the world.

Has a market share of 60% in the glucose biscuits category, worth about Rs.2,000 crores

Consumed for taste, nourishment and energy by people of all age groups.

For over 50 years now, it has stood virtually unrivalled for its quality and value for money.

Identified with the baby on the pack. She is affectionately called the Parle-G baby.

Available in different grammages from 25g to 500g catering

MRP : Re. 1, Rs. 2, Rs. 3, Rs. 4, Rs. 5, Rs. 10, Rs. 20, Rs. 30, Rs. 40 & Rs. 50

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The Urban Market Scenario

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Th e country s largest selling biscuit brand, P arle-G, and ot h er glucose biscuits arefast losing t h eir market s h are to premium products as t h e potential Indianconsumer develops an appetite for cookies and cream biscuits.

Market experts opine t h at t h e s h are of glucose biscuits, contributing for more t h anh alf of t h e Rs 9,500-crore organised biscuit market in t h e country, h as been goingdown by 2-3% in a year for t h e last t h ree to four years.P arle-G, w h ich accounts more t h an 70% to t h e P arle s revenues a few of yearsback, now contributes to 6 0-6 5%. According to a report publis h ed by MotilalOswal, t h e glucose segment contributing to I TC Foods revenue h as been loweredfrom 5 6 % in 2007-08 to 48% in t h e current fiscal.

Britannia s largest brand T iger accounts to just over 20% of t h e company s netrevenue.Th is downfall h as been witnessed due to t h e introduction categories of foods suc h as cookies, cream, crackers, fortified biscuits and cream wafers.

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Glucose biscuits accounts for more than 50% of the total biscuit market value, Parle G dominate thismarket with more than 60% share followed by B ritannia and I TC.

W ith a total turnover of around Rs 4,000 crore coming from biscuits, Parle Products hasemerged as the clear market leader in 2010

Britannia Industries reported a turnover of Rs 3,400 crore for the financial year 2009-10, withbiscuits contributing around Rs 3,000 crore.

Going by the turnover numbers, Parle leads with a margin of Rs 1,000 crore over Britannia.

P arle beats Britannia as No 1 biscuit co.

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The Rural Market Scenario

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In t h e biscuit market, rural India is spoilt for c h oice wit h a h ost of local as well asnational players vying for a s h are of t h e consumer s wallet.Th e biscuit market is estimated at Rs 8,300 crore in rural India

Aiming for a deeper penetration in rural markets, FMCG majors, are introducingproducts small pack sizes and in low price points particularly in t h e Rs 5 categoryas part of t h eir strategy to s h ore up volumes.

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Parle-G in Rural market

In India it is a habit to have biscuits along with chai or tea - Parle G is referred to as "biskut" inrural areas

Parle G market reach is very high due to its distribution network Parle G is present across 2.5-

3 million retail outlets

When asked for biskut to a shopkeeper it simply means Parle-G biscuit in rural areas

Rural market penetration is 50% 65%

Parle-G being a consumable product is not influenced by factors like culture, norms or values

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Rural P layers

Balaji, Haldiram, P arle and P rakas h Snacks.

Locally manufactured biscuits

Unpacked baked items (kh ari )

Fried eatables (vada paw, b h ajiya )

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S ales strategy to market Parle G in ruralmarket For Consumers

Targeting younger generation in t h e rural area i.e. Sc h ool goingch ildren

Replacing t h eir snacks from un h ealt h y food to nutritious P arle G byserving mid day meals in primary sc h ools

Associating P arle G as h ealt h food complete nutrition package

Associate wit h Rural Government Initiatives likeP rimary Education Sc h eme

National Ruralh

ealth

mission centre

Offering various discounts & sc h emes during festivals e.g. P arle gh amper

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S ales strategy to market Parle G in rural market For Retailers

Organizing display units at t h e store

Incentives given to smaller retailer for renovation of t h eir store on ac h ievingth e sales target

Organizing h ealt h ch eck up for t h e retailer & t h eir family under slabs of different sc h emes

Offering discounts & trade sc h emes