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8/4/2019 International Bussiness Choco Ritesh
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International bussiness
Exporting chocolates to India
Presented to
Prof. C.S.Balasubramaniam
BGIMS
MMS- Finance
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Group MembersName Roll no
Farid Charania 62
Seema Kalro 69Tanaya Mengle 72
Shyam Palan 82
Ritesh Shirshat 102
Pranal Waghule 120
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Assumptions
We are considering only the organized market
in this presentation.
Financial aspects are not taken into
consideration.
All the rules, regulations, policies and law
related aspects are taken into consideration.
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‘We’ Italy comes to ‘ You’ India
Italy India
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PROFILE of Company
• Established in 1878
• Atelier of confectionary art
• Current export share: 15%
Exporting Countries
• China, Japan, U.S.A and Germany
Penetration WORLD Market share - 12%
Market value - 15 million
Product line – 250 (no.)
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Overview of the company
Manufacturing process 1. Fermentation
2. Drying
3. Toasting
4. Screening/ventilation
Current products
Sales and marketing operations : Our stores areestablished in more than 25 countries
Original chocolates Prestige chocolates Classic chocolates Tartufi Praline Jars
Fruttati Gift boxes Nougat
Cuba rhum Spiced blend Bars
Classical boxes Marrons glaces Unico
cubarillo Dubledo & dragees Chunks
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Indian demographics
Second largest population in the world
Sectoral employment
Agriculture-60%, Industry-17%, Services-23%
Majority of population falls under Upper middle classand Lower middle class.
Rural-Urban divide 72:28
Age composition :
Up to 14 years - 32%15-59 years - 60%
60 years and above 08%
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Chocolate Market
in India Facts & Figures
Chocolate market is around 1500 crores and growing at 18-20% perannum - by AC Nielson
The per capita consumption of chocolate in India is 300 gram comparedwith 1.9 kilograms in developed markets such as the United Kingdom.
Over 70 per cent of the consumption takes place in the urban markets.
Chocolate sales have risen by 15% in 2007 to reach 36000 tonesaccording to one estimate. Another estimate puts the figure at 25000tones.
Contd..
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• The chocolate wafer market (Ulta Perk etc) is around 35 % of the total chocolate market and has been growing at around13% annually.
• As per Euro monitor study, Indian candy market is currently
valued at around USD 664 million, with about 70%, or USD461 million, in sugar confectionery and the remaining 30%, orUSD 203 million, in chocolate confectionery.
• Entire Celebrations range market share is 6.5%.
• The global chocolate market is worth $75 billion annually.
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Chocolate Market
in India Market Size (by value & by volume)
The Indian chocolate market is valued at Rs. 650
crores (i.e. Rs. 6.50 billion) a year.The Indian chocolate bazaar is estimated to be in
the region of 22,000-24,000 tones per annum,and is valued in excess of US$ 80 million.
Contd..
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Chocolate penetration in the country is a little over 4percent, with India's metros proving to be the big drawclocking penetration in excess of 15 percent. Next, comesthe relatively smaller cities/towns where consumption
lags at about 8 percent.Chocolates are a luxury in the rural segment, which
explains the mere 2 percent penetration in villages.
The market presently has close to 60mn consumers and
they are mainly located in the urban areas.
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Major players: (organized market)
Cadbury-Market share :75%
Nestle India : 14 %
Amul : 5%
Others : 6%
75%
14%
6% 5%
Market Share
Cadbury
Nestle
Amul
Others
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Forms of consumption
1. Moulded Chocolate Segment –
comprising slab chocolates
2. Count line Segment –
comprising bars.
3. Chocó-Panned Segment –
comprising chocolate forms
4. Sugar-Panned Segment – comprising chocolate forms
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Consumer trends in India
Replacement of traditional Indian sweets
Impulsive purchase
Status symbol
Value for money
All year round gifting options
Wide range of options
Inclination towards dark chocolate
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PESTel Analysis
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The three basic principles are:
1. Non-discrimination - each member country must treat
the trade of all other member countries equally
2. Open markets which are encouraged by GATT through a
prohibition of all forms of protection except customs
tariffs, and
3. Fair trade which prohibits export subsidies onmanufactured products and limits the use
of export subsidies on primary products.
Political Analysis
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Economic analysis
Changes in living standards and its affect consumptions patters. Increase in raw material costs by more than 20 % it will force the
manufacturers to consider a price hike.
Chocolate Industry's margin range is between 10 and 20%, dependingon the price point at which the product is placed.
The input costs in India are under check owing to the 24% decline inthe prices of sugar.
The relatively small Indian chocolate market with volumes of about55,000 metric tonnes of chocolate and expected to grow by around17.8% between 2008 and 2012.
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Social analysis
Social factors that need to be considered include changingpatterns of consumption.
Today many consumers like to eat 'on the go', so bite sized
chocolate treats are in great demand to top up consumersenergy supplies.
Lifestyle, attitudes and needs of consumers are undergoing achange.
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Technological analysis
Technological change is particularly important today, for
example, the development of new technologies that have
enabled variations on chocolate bars to be produced in an ice
cream format.
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Legal analysis
F.D.I allowed in Confectionery market.
Taxation Policies.
Law regarding Joint venture with Indian Co.
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Environment analysis
The process whereby businesses examine the external environment toidentify key structural changes in the world around them which affect
demand and supply conditions for their products.
The prices of cocoa and milk, the chief ingredients used in chocolates,
have gone up by 50 per cent, while the price of sugar, another
important raw material, has come down.
The overall input costs have gone up by 20 per cent.
India imports most of its cocoa requirements. The prices of cocoa have
risen globally due to unavailability of the commodity.
US-based chocolate-maker Hershey is mulling a foray into the Indianchocolate market through its joint venture with Godrej.
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Objective to enter
Indian Market
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Objective
Objective is to cater Indian mass-market
Factor influencing to the objective:
- Large and untapped Population- Potential customer base
- Increasing demand
- Change in lifestyle and buying pattern
- Increment in Per capita income
- Brand awareness
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Product with Features
1. Mister o’ brown- Dark cocoa chocolate
2. Blend- Mix fruit chocolate
3. Diva- Rich silky chocolate4. Amano- sugar free chocolate
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Price
• All chocolate will cost between 35 to 50
pricing strategy
• Perceived Value Strategy
• Value for Money
Segmentation and
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Segmentation and
Targeting
Segmentation• Youth and chocolate lovers
Age
•
12 to 55 Years with different variants Target Market
• Metropolitan Cities
Competing with
• Nestle• Cadbury
Distribution and Marketing
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Distribution and Marketing
Strategy
Prime RetailOutlet & malls
AmulDistributor
VenchiPlant
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Location & Market
Primary Market Mumbai, Delhi, Kolkata, Bangalore
Plant LocationKoparkherane, Okhla, Hugli, Banshankari
Launching Date 15 days prior to Diwali
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Promotion Mix
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Promotion Mix
Advertising
Print media –
Local Newspaper : TOI (Bombay Times, Delhi Times,Bangalore Times, Kolkata Times), Deccan Herald,Calcutta Post. As a half jacket.
– Magazines: Lifestyle, Vogue, FHM, Loaded etc. – Outdoor advertizing like placing signs or paint logos on
public transports such as Trains or Private Buses in 4
cities.
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Electronic Media
– Broadcasting adds on TV
– Radios
Others
–
Open Truck Rally
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Sales promotion – Sponsorships for special events e.g. College events, Car Rally,
Cricket matches, Mumbai Marathon.
– Give- away (T-shirts with the Vinchi logo)
– Placing a sidewalk sign, Hoardings, banners
– Providing Free Gifts on Christmas Eve and New Year celebration in
5 star Hotel
Trade Promotion (Push Strategy) – Dealer discounts
– Credit terms
–
Attractive Incentives
Promotion Mix
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Diwali Sweet Marketing Strategy
Teaser advertisement before 15 days of Launching
the Product
Italian chocolate Pure Cocoa
Marketing Strategy
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SWOT ANALYSIS
S
Variety of chocolates
Quality of chocolates
Brand image
Amul-distribution strategy
W
New entrant
Not familiar with the Indian Market
OIndia’s population
Festive season
Demand of premium chocolate
T
Competitors (Cadbury)
SWOT
Michael Porter’s
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Michael Porter’s
5 force model
Threat of new entrants- Musketeers, New variants likeCadbury Silk.
Threat of competitors - Lindt, cadbury-kraft food, Homemade chocolates, foreign chocolates sold in the
unorganized market. Threat of substitutes- Sweets
Bargaining power of suppliers-High
Bargaining power of customers-High
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Future prospects
Currently we are expecting a market share of 1% bythe end of 2011.
Increase in Market share by 5% by 2015.
Promotional strategy by assigning brand
ambassadors. Increasing Market capitalization by at least 10% y-o-y
basis
Tapping new market segments.
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