International Bussiness Choco Ritesh

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



Group MembersName Roll no

Farid Charania 62

Seema Kalro 69Tanaya Mengle 72

Shyam Palan 82

Ritesh Shirshat 102

Pranal Waghule 120



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.



‘We’ Italy comes to ‘ You’ India

Italy India





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.)



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



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%



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..



• 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.



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..



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.



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



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



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



PESTel Analysis



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



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.



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.



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.



Legal analysis

F.D.I allowed in Confectionery market.

Taxation Policies.

Law regarding Joint venture with Indian Co.



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.



Objective to enter

Indian Market



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





Product with Features

1. Mister o’ brown- Dark cocoa chocolate

2. Blend- Mix fruit chocolate

3. Diva- Rich silky chocolate4. Amano- sugar free chocolate



Price

• All chocolate will cost between 35 to 50

pricing strategy

• Perceived Value Strategy

• Value for Money

Segmentation and



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



Distribution and Marketing

Strategy

Prime RetailOutlet & malls

AmulDistributor

VenchiPlant



Location & Market

Primary Market Mumbai, Delhi, Kolkata, Bangalore

Plant LocationKoparkherane, Okhla, Hugli, Banshankari

Launching Date 15 days prior to Diwali



Promotion Mix



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.



Electronic Media

– Broadcasting adds on TV

– Radios

Others

–

Open Truck Rally



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



Diwali Sweet Marketing Strategy

Teaser advertisement before 15 days of Launching

the Product

Italian chocolate Pure Cocoa

Marketing Strategy



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



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



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.



Documents

International Bussiness Choco Ritesh