This action might not be possible to undo. Are you sure you want to continue?
ANALYSIS OF FOOD INDUSTRY OF INDIA
“Submitted in the Partial Fulfillment for the Requirement of Post Graduate Diploma in Management” (PGDM)
Submitted byLove Mahajan Pallav Bajaj Mohit Verma Pooja Rajput
For us, this Mini Project has been a rich and rewarding experience. We owe a debt of gratitude to all those who have given us guidance and support. We take this opportunity to express our deep sense of gratitude and respect for our guide Mrs. Sanjeela Mathur who not only encouraged us through this venture with his timely and valuable guidance but also took a great pain in going through this work, Without his valuable advice and suggestion at every stage of our endeavor, this work would not have been feasible. We would like to express our sincere thanks to everyone who directly or indirectly contributed in making our endeavor feasible through their critical comments and valuable suggestions.
Love Mahajan Pallav Bajaj Mohit Verma Pooja Rajput
We the undersigned, students of trimester VA P.G.D.M. studying at JIMS Kalkaji, New Delhi, declare that the Project entitled
ANALYSIS OF FOOD INDUSTRY OF INDIA
was carried out by us as a part of the BPSM Project and is submitted to MRS. SANJEELA MATHUR This project was taken up as a part of the academic curriculum. It does not have any commercial interest or motive. This is our original work and is not submitted to any other organisation for any other purpose.
Date: 20Th Sep. 2012
Place: New Delhi
Jagannath International Management School, Kalkaji, New Delhi
Date: 20th sept.G.D. 2012 New Delhi Mrs. Sanjeela Mathur General Introduction of food Industry . It is a part of their academic curriculum and is not intended for any other purpose.This is to certify that Love Mahajan Pallav Bajaj Mohit Verma Pooja Rajput The students of P.M. Trimester VA have worked on the project under my supervision and this is their own work.
56 billion) and is growing at a healthy CAGR of 17 per cent. "In the future. According to another report. India has emerged as the fifth most favourable destination for international retailers.at around 20 to 25 per cent per annum. 'Indian Food Services Market Forecast to 2015'. as per RNCOS research report titled. according to a Franchise India report released at the Indian Restaurant Congress. according to A T Kearney's Global Retail Development Index (GRDI) 2012.000 crore (US$ 13.India is the world's second largest producer of food next to China.370 billion (US$ 24.77 billion) by 2015. Key Players . President of Franchise India. according to a RNCOS research report. and has the potential of being the biggest with the food and agricultural sector. growing at a CAGR of 15 per cent. The total food production in India is likely to double in the next ten years and there is an opportunity for large investments in food. especially with the niche retailers. The food services sector in India is expected to reach Rs 1." says Mr Gaurav Marya. The Indian food services industry is expected to grow at a compound annual growth rate (CAGR) of around 12 per cent during 2012-2015. India has also been recognised as one of the largest potential market for organic food consumption worldwide. The country is fast becoming an important investment destination for foreign players with companies such as Starbucks and American brand Dunkin' Donuts marking their entry into the country. the industry is estimated to be nearly worth Rs 75. the organised market is expected to grow even faster . ‘Indian Organic Food Market Analysis’. The organic food is invariably increasing among the Indian retailers. The report further expects that the sector will post significant growth during 2011-2013.
the Indian organised pizza market will surge at a CAGR of more than 27 per cent during 2012-2015. The most delectable of them all is Pizza. Yogurberry plans to set up seven new stores in the country by end of next year and another 100 over the next five years." according to a company official According to a new research report by RNCOS. Furthermore. and is expected to be followed by GlaxoSmithKline Consumer Healthcare (GSKCH)'s within few months. The informal eating-out (IEO) industry in India is growing steadily at 15 per cent per annum Emerging foods categories such as muesli. RPG Enterprise and Godrej Agrovet Ltd. fuelled by the entry of new players and growing demand for health foods Korea-based frozen yoghurt maker. the Indian market frozen yogurt will grow to US$ 5 billion over the next three years. is growing faster than oats and muesli. Cadbury Schweppes PLC. olive oil consumption increased 49 per cent.08 million) muesli market soon. ITC Ltd. India has emerged as the fastest growing market for Domino's. "The expansion plan will begin with new stores in Chennai and Bengaluru. As per market estimation.83 million) in the next three years.29 million) packaged olive oils segment. Nestle SA.000 crore (US$ 180. PepsiCo. on top of a 46 per cent growth in the previous year Frozen yogurt chain. Britannia Industries Ltd. which has now emerged as one of the most favourite fast food items of the Indians especially the young generation. Godrej Industries Ltd. management consulting firm Tecnova estimated the Indian packaged food market at US$ 10 billion in 2010 and expects it to grow 20 per cent CAGR to US$ 30 billion by 2015.The major players operating in the Indian food and beverages industry include Dabur India Ltd. Food Processing Industry . and additional stores in cities like Delhi-NCR and Mumbai. the firm recorded an annual growth rate of nearly 50 per cent for the fifth consecutive year McDonald's India plans to invest Rs 1. the demand for various fast food items is consistently rising in India. Edible oil major Marico will extend its Saffola brand into the Rs 100 crore (US$ 18. Last year. Inc. outpacing US. Red Mango plans to expand across the country by launching 15-20 outlets in metro cities by next year. oats and olive oils are getting increasingly competitive with more food marketers aiming at capitalising on the increasing demand for health food. Meanwhile. According to Technopak. the Rs 350 crore (US$ 63. Hindustan Lever Ltd. In India. meanwhile. taking up its total outlets to 500. Future Group.
India is the world’s largest milk producer. . soya-based products. ‘Indian Dairy Industry Analysis’. spices. according to the latest data published by Department of Industrial Policy and Promotion (DIPP). fisheries. and cost competitiveness. The study anticipates that the milk production in India will grow at a CAGR of around 4 per cent during 2011-2015. abundant livestock. milk and milk products. grain processing and other consumer product groups such as confectionery. plantation. high protein foods etc. beverages. according to RNCOS research report titled. India is fast emerging as a sourcing hub of processed food.456. mineral water. accounting for around 17 per cent of the global milk production. India's food processing sector covers fruit and vegetables. meat and poultry.20 million between April 2000 to June 2012.With a huge agriculture sector. The food processing industries attracted foreign direct investments (FDI) worth US$ 1. chocolates and cocoa products.
Coca Cola. 2012. Production in January 2012 climbed t 20. with investments estimated at over US$ billion to date India and Taiwan are looking to expand tea trade between the two countries. as the former India Head of Yum Restaurants. these businesses received US$ 256 million of funding overall while this year has already seen US$ 43 million being invested. A business delegation from India visited Taiwan from June 28 to July 1.720 tonnes in 2011-12. according to Spices Board of India . according to Mr Muhtar Kent Chairman and Chief Executive Officer (CEO). "With the growing popularity of the food and beverage businesses in India. The country ranks among the top 10 investing countries in South Africa. brought brands like KFC and Pizza Hut to the country. who.51 billion in 2011-12 Spices exports from India stood at 575. as against 525. the investment community has made significant investments here. The company expects India to be among its top five markets worldwide by 2020. following initiatives will be taken by the Government under the National Mission on Food Processing: A new centrally sponsored scheme titled ‘National Mission on Food Processing’ to be started in 201 13 in co-operation with State Governments Steps taken to create additional food grain storage capacity in the country Subsidies fully provided for effective administration of the proposed Food Security Legislation To promote private sector activity and invite foreign investments in the sector the Government allows 100 per cent FDI in the food processing & cold chain infrastructure Some of the other initiatives include: South Africa seeks investment for its flourishing food processing sector from India. The delegation held meetings with importan stakeholders of the Taiwan tea industry and discussed ways and means to increase cooperation between tea companies of the two nations South East Asia has become the largest buyer of Indian marine products with a share of 40 per cent volume and 25 per cent in value (in terms of US$).24 billion) earlier.77 billion) as compared to Rs 6.4 million litre.841 crore (US$ 1." highlighted Mr Sandeep Kohli.021 tonnes valued at US$ 3.783 crore (US$ 1. as per Centre for Monitoring Indian Economy (CMIE) data. Last year. The marine products exports touched 862. Government Initiatives According to the recently announced Union Budget 2012-13.Beverages Juice production in India is witnessing a consistent increase in 2012.750 tonnes in 2010-1 The total export earnings rose by 43 per cent at Rs 9. Coca-Cola plans to invest US$ 5 billion over the next 10 years as it expands its capacities in India.
this sector is capable of maintaining the growth momentum in the future. . Foreseeing the future growth.Road Ahead With massive scope for value addition. Out of the total investments worth US$ 750 million in 2012. . providing opportunities to loc players to widen their product portfolios. Food suppliers and retail companies plan to scale up business and stay competitive by tapping the large potential of the domestic market. growing trend in the consumption pattern of processed food products in India and many fiscal incentives being planned by the Government. This trend will emerge more strongly by 2015. food and beverage firms. many big international players are entering the Indian market by making deals with domestic players. about US$ 1 million has gone into purely front-end retail. such as fast moving consumer goods (FMCG).
of household mainly because of increase in nuclear family where both the husband and wife are earning. Spending Pattern An increase is spending pattern has been witnessed in Indian FMCG market. by 2030 India population will be around 1. According to the estimates. There is an upward trend in urban as well as rural market and also an increase in spending in organized retail sector. An increase in disposable income. has leads to growth rate in FMCG goods.150 Billions which is just behind China.Growth Prospect Large Market India has a population of more than 1.450 Billion and will surpass China to become the World largest in terms of population. FMCG Industry which is directly related to the population is expected to maintain a robust growth rate. .
These are giving tough competition to the small retailers. The landscape in many urban commercial centers has come to be dominated by big shopping malls. The customers are attracted by them because they are providing better environment for purchasing. plazas and multiple entertainment complexes. automatic foreign investment and food laws resulting in an environment that fosters growth. . many international business houses. attracted by the sheer volume of over 250 million buyers have flooded the Indian market. Fisheries: The fish production rate in India has witnessed a remarkable growth since 1995-96. Retail Industry In the wake of liberalization. Fish Farmers' Development Agencies and Brackish Water Fish Farmers' Development Agencies have been the major contributors to the growth in fisheries in rural India. These retailers have opened their outlets in India mainly in urban and sub urban areas. The National Program of Developing Fish Seeds.Advantages To The Sector Governmental Policy Indian Government has enacted policies aimed at attaining international competitiveness through lifting of the quantitative restrictions. A diversified range of fishing methods along with processed fish products have been introduced in the Indian rural market through an Integrated Fisheries Project. reducing excise duties. 100 per cent export oriented units can be set up by government approval and use of foreign brand names is now freely permitted. not to speak of global fast food chains. displaying the latest in consumer and fashion goods.
Milk & Milk Pro d u c t s . exporters and importers widely dealing in sectors like the -Food Industry. Indian beverage industry etc. bottling plants. high protein foods etc. milk and milk products.Specialty Processing. T h e I n d i a n f o o d industries sales turnover is Rs 140. dairy and food Processing. Karnataka. especially in areas of canning. process machinery etc. and has the potential of being the biggest with the food and agricultural sector. This indicates vast scope for both investors and exporters. fisheries. canning.Poultry: Poultry Business is one of the major contributors to the growing economy of rural and semi-urban India. packaging industries. Alcoholic Beverages & Soft Drinks and Grains are important sub -sectors of the food processing industry. 8 b i l l i o n w h e r e a s t h e w o r l d t o t a l w a s U S $ 4 3 8 b i l l i o n . Fruits &Vegetables. States of Andhra Pradesh. grain processing and other consumer product groups like confectionery. alcoholic beverages. manufacturers. We also cover sectors like dairy plants. meat and poultry. mineral water. Food exports in1 9 9 8 s t o o d a t U S $ 5 . Packaging. Fisheries. India is the seven largest poultry producer all over the world.000 crore (1 crore = 10 million) annually as at the start of year 2 0 0 0 . P a c k a g e d / C o n v e n i e n c e F o o d s . Dairy processing. Frozen Food/Refrigeration and Thermo Processing. M e a t & P o u l t r y . The most . The total food production in India is likely to double in the next ten years and there is an oppo rtunity for large investments in food and food processing t e c h n o l o g i e s . The industry has the highest number of plants approved by the US Food and D r u g A d m i n i s t r a t i o n ( F D A ) o u t s i d e t h e U S A India's food processing sector covers fruit and vegetables.I n d i a i s o n e o f t h e w o r l d ’ s m a j o r f o o d p r o d u c e r s b u t a c c o u n t s f o r l e s s t h a n 1 . plantation. India has witnessed a remarkable growth in the egg and poultry meat industry in the recent period. chocolates and cocoa products. s k i l l s a n d equipment. Soya-based products. A health food and health food supplement is another rapidly rising segment of this industry which is gaining vast popularity amongst the healthconscious. 5 p e r c e n t o f international food trade. We cover an exhaustive database of an array of suppliers. Kerala and Tamil Nadu contribute to around 45 percent of the total egg production in India whereas the eastern and central parts of India contribute to around 20 percent of the same. Food Processing Industry: India is the world's second largest producer of food next to China.
Food additives . government initiatives (tax holidays) & availability of raw materials. the Indian food processing industry is basically export oriented.a q u a c u l t u r e . Fast-food. At present. This section analyses the performance of the Indian food processing industry.promising sub-sectors includes -Softdrink bottling. which is very low as compared to the western countries. Additionally. from cereals to more varied and nutritious diet of fruit and vegetables. with the emerging positive market forces. Currently. the industry is seeking for investments to create necessary infrastructure.As a result it is hailed as the ‘sunshine industry’ in India. Although domestic consumption of processed food is low but it is fast picking up with rising income levels& changing consumer behavior due to economic growth. it is all set to boom . meat and poultry products has been the key factors behind the growth of the sector. Confectionery manufacture. several duty and tax relief. Existence of untapped large consumer base with rising income levels. Meat and poultry processing. However. Indian processed food industry provides competitive advantages over other countries due to cheap workforce. Taking market forces such as rising income level and changing consumer behavior due to rapid economic growth into consideration. state-of-the-art-technology and expand production facilities to match the international quality and standards. Milk processing. . The food processing industry has emerged as one of the major driver of economic growth and is expected to continue in future.1%. Indian food processing level as compared to countries like USA. Growing economy. dairy products (include s milk. Fishing. In food processing sector. Alcohol i c beverages. Ethnic sweets etc) and packed food provides immense opportunities for investment. processed food accounts for merely 2% of total food production in India. milk. G r a i n milling and grainbased products. the Indian food processing industry witnessed growth from 7% to 13. Ready-to-eat breakfast cereals. it is expected to reach a growth rate of 10% in 2010& 25% in 2020. financial assistance for infrastructure building and setting up of food processing units is expected to benefit the sector. fish.flavors etc. surplus food and a shift in the consumption pattern. France & Malaysia continues to remain very low. Indian Government’s proactive measures like de-licensing of the sector. Tomato paste. Currently.During the period 2006-07.
White goods in FMCG refer to household electronic items such as Refrigerators. soft drinks. The price or value of the products is not very high. shaving products and detergents. FMCG products are those that get replaced within a year. These are replaced more frequently than other electronic products. tooth cleaning products. T. Examples of FMCG generally include a wide range of frequently purchased consumer products such as toiletries. These products are purchased by the customers in small quantity as per the need of individual or family. It may include perishable and non perishable products. FMCG may also include pharmaceuticals. GPS Systems and Laptops. digital cameras. as well as other non-durables such as glassware.Vs. Music Systems. etc. These products are having short life also. durable and non durable goods. and chocolate bars. A subset of FMCGs is Fast Moving Consumer Electronics which include innovative electronic products such as mobile phones. cosmetics. tissue paper. .FMCG Sector in India: Introduction Products which have a quick turnover. These items are purchased repeatedly as these are daily use products. paper products. packaged food products. MP3 players. soap. and relatively low cost are known as Fast Moving Consumer Goods (FMCG). and plastic goods. bulbs. batteries. consumer electronics.
This is expected to result into an overall market progress in which the consumer will be benefited the most. which includes availability of food and access to food and even as the former has been achieved. The economics of the food industry has been changing due to the easy access of multinationals. where entry barriers are low. milk and dairy products. The promising sectors of the food market of India are inclusive of fruits and vegetables.2 billion). . there is a wide scope for many large Indian corporates entering and extending their business. The Indian food market is approximately Rs 2.000 crore ($22. What’s more. It will require balanced brand portfolio strategies. In addition. there is a need to increase the range of foods available to improve overall nutrition. Another upcoming sector of the Indian Food Market is the segment dealing in healthy food and healthy food supplements. meat and poultry. junk food. In such a situation. it is imperative that we reorient our historical agricultural policy framework. Owing to the structural changes in the Indian Economy. confectionary.000 crore ($69.Current scenario of food and beverages in India India’s Food Revolution will guarantee an agriculture diversification along with providing huge investments in the food processing sector. The augment of regional players venturing into categories. packaging and exports with strikingly high level of technological involvement. the same is not the case with the latter. rise of commodity branding and low cost of technology. comprising of diverse product mix with a superb level of quality and that too at an affordable price. Food Security has two dimensions. The advantages in terms of health. Yet. as India is achieving selfreliance in grains production. a boom in the Indian FMCG (fast moving consumer goods) markets and the rising need for these products are the main causes for growth and expansion in the food business. Although this is still in its inception. grains. Regardless of bumper crops. the Food Retailing Sector is also a continuously growing market in our country. 50. ready to eat meals. food additives and such.4 billion). allocation of food grains continues to be faulty and almost 30 % of the food produced in the country is wasted. the Indian agriculture is in the run for an exemplar shift. This mostly results in possibilities of new retail outlets like hyper and super markets that emerge country wide Consequently. the priority has changed from subsistence farming to commercialization opening up vast opportunities for value-addition. the low brand loyalty and price-sensitive consumer is putting off the Indian market from unfolding its full prospective. vitality and productivity are obvious and cannot be underestimated. right from handling shortages to endorsing efficiencies and value addition. of which valueadded food products comprise Rs 80. Along with this. fishing.
Various Sectors In The Food Industry Grain Processing Bakery Products Cocoa Products Soft Drinks Fruits And Vegetables Milk And Milk Products Meat And Poultry Fish Organic Food Industry .
RRL is based on the growth strategy of backward integration. is Reliance Group’s foray into organized retail. Subsidiaries & division under Reliance Retail are: Overview . V.400701 Over a 1000 stores across India Mukesh D. Meswani . small shopkeepers and consumers.Executive Director Hital R. P. fruits. Raghunath Anant Mashelkar Reliance Retail Limited (RRL). a subsidiary of Reliance Industries Limited under Mukesh Ambani.Executive Director H. Dipak C Jain Dr.4 billion RCP STTC Industrial Area. Kapur M. Modi S. and it generates inclusive growth and prosperity for farmers. groceries. Bhakta Yogendra P. Ashok Misra Prof. Ambani Mansingh L.RELIANCE RETAIL Date of Establishment Revenue Market Cap Address Branches Management Team 2006 Rs 2500-5000 Crores US $ 27. Its retail outlets offer foods.Executive Director Ramniklal H. apparel and footwear. electronic goods. Ghansoli . Mumbai .S. Trivedi Dr. Tanabelapur Road. vendor partners.Kohli . RLL is the second largest retailer in India. lifestyle and home improvement products. Meswani . and flowers. D. and farm implements and inputs.Chairman & Managing Director Nikhil R. The company’s outlets also provide vegetables. Ambani . Venkitaramanan Prof.
"Reliance One". Reliance iStore. Reliance Retail serves over 2. fresh juice. bars and dairy products and they have their headquarters in Mumbai. Reliance Footprint. RLL has employee strength of above 5001. Reliance Trendz. A typical Reliance Fresh store is approximately 3000-4000 square feet and caters to a catchment area of 2–3 km. These stores sell fresh fruits and vegetables.5 million customers every week. . Reliance Super. Reliance Mart.75 million customers. Its loyalty programme. taking the total to 100 stores across key markets in the country. Reliance Wellness. RELIANCE FRESH Reliance Fresh is the convenience store format which forms part of the retail business of Reliance Industries of India which is headed by Mukesh Ambani. staples. Reliance Autozone. has the patronage of more than 6. Across India. Reliance Home Kitchens and Reliance Jewel. Reliance Time Out. During the year 2011. RRL opened 51 new stores pan India. Product range of reliance fresh • Vegetables and fruits: This is the specialty of the store as they provide fresh fruits and vegetables at a rate lower than the market price. groceries.These are spread across formats such as Reliance Fresh. Reliance Digital.
• Refrigerated products: This product line is dominated by the brands available in market and very less private labeling is done. . • Groceries: In this sector reliance is promoting its private label as they are promoting their own brands and they do the packaging of the product and then label it privately and then sell it at premium as compared it to the loose items. • Non food items Here we get many petty non food items at a premium than market price. • Dairy Products: The dairy products in some locations are procured from the farmers themselves and some places they procure it from the manufacturers. but usually of high quality. Households Items: In the stores we can get items which are at slight premium rate than market price. • Food and Beverages: This area of the product line they stock all the premier brands and also their private label.
demographic. and increasing importance of branding.BRAND IDENTIFY AT RELIANCE FRESH In this part of brand identity the outer core level is taken in consideration. The study of environmental analysis is done by endeavoring on the technological. consistency and maximum communication impact. Socio/Cultural and economic aspects and they are as follows: . rapid growth of database marketing. The main reasons behind the growth in importance of IMC tools are shift from media advertising to other forms of marketing communication. Design: The design of the brand reflects which it wants to communicate to its customers. consistency and maximum communication impact. Logo/Symbol: The logo of Reliance fresh includes a leaf structure which represents freshness. In short combine the disciplines to provide clarity. IMC program situation analysis: The situation analysis of IMC program includes the external factors which includes the environment analysis and competitive analysis. INTEGRATED MARKETING COMMUNICATION (IMC) It is a concept of marketing communication planning that recognizes the added value of a comprehensive plan that evaluates the strategic roles of a variety of communication discipline and combines these disciplines to provide clarity. In Reliance fresh being a store its design of reflects that it is a low cost because the fixtures and the cost of the store looks very low and gives a feel of budget shopping and use of graphics throughout the store and outside the store attracts the customers and communicate the deliverables of the store. The majorlevels are as follows: Brand Identify The brand name consists of two parts one is „Reliance‟ which means the name of parentcompany „Reliance Industries Limited and secondly the “Fresh” means „provides fresh merchandise‟. Brand name: The brand name consists of two parts one is „Reliance‟ which means the name of parent company „Reliance Industries Limited and secondly the “Fresh” means „provides fresh merchandise‟.
the rest to other food products like staples. Network of more than 1600 channels in the village. Experienced management team. Backward integration. (Slow billing. etc. Lack of Information) . Lack of well trained staffs. Reliance does contract farming which is beneficial to them. spices. WEAKNESS: Multi format presence. bakery. Losses due to joint ventures.SWOT Analysis. Inventory is not properly controlled by staffs.Reliance Fresh STRENGTH: Reliance is the first to enter in this unorganized sector of vegetables and fruits. High brand equity. Lack in supply chain. Over 60% of the floor space has been dedicated to fresh fruits and vegetables. Most of the staples are under its own private label brand Reliance Select. Presence at only prime locations. Reliance fresh has a strong financial back up.
Many untapped markets in India. restriction on the concept of contract farming in some states. Eliminate intermediaries and reduce the cost. THREATS: Increasing competition due to entry of many national and global players. Increasing buying power of Indian consumers. Low price competition from players like Subhikhsha.OPPORTUNITIES: Growing retail market. Safal etc. Increasing operating cost. . They also have a threat from the existing supermarkets which provides all the services to its customers. Govt. Reliance wants to build a high-profitable business and food is perhaps. the best venture to start.
THREAT OF NEW ENTRANTS : • • • The threat of entry of new competitors into the food retail industry is low. . Gaining planning authorisation from local government takes a considerable amount of time and resources to establish.PORTER’S MODEL.Food Industry 1. It requires huge capital investments in order to be competitive and to establish a brand name.
3. The slow market growth for the retail market means that firms must fight each other for market share. In cases where products have a slight differentiation and are more standardised.2. the switching cost is very low. AVAILABILITY OF SUBSTITUTES: • • The threat of substitutes in the grocery retail market is considerably low for food items and medium to high for non-food items. A contract with a large retailer such as Wal-Mart can make or break a small supplier. . BARGAINING POWER OF SUPPLIERS : • • The bargaining power of suppliers is fairly low. 5. 4. POWER OF BUYERS: • • The bargaining power of buyers is fairly high. COMPETETIVE RIVALRY: • • Retailers always face stiff competition. What one store offers you will likely find at another store.
consumer durables. has been the retail business of Reliance aptly named more. cities in 14 States. home. As it Industries of India . About the company RELIANCE Reliance Retail subsidiary Fresh Limited of the MORE Reliance more.COMPETITIVE ANALYSIS: RELIANCE FRESH vs MORE Points of Comparison 1. with food accounting for the bulk of the business. to change the shopping super market focusing on experience for consumers . The Indian Aditya Birla Group. Aditya Birla Retail (RRL). launched Company ventured into food its first convenience store in and grocery retail sector in November 2006. a Limited is the retail arm of Corporation. weekly and include over 750 Reliance monthly shopping needs of Fresh stores. RRL has 2007 with the acquisition of a grown rapidly and operates south based supermarket supermarkets over 900 stores across 80 chain. a USD 28 Retail billion conglomerate Industries Limited. IT and wellness . is the convenience store group has Currently a the national format which forms part of presence The store. which cater to the daily. more. Reliance Fresh consumers. FMCG. It is promises positioned as a pure play everyday categories like food.
groceries. is located in commercial complexes close a series of conveniently neighbourhood Currently it to 3-4 big residential areas located Observation: found close to supermarkets view from the road ‘Crossroads’ Enjoy a clear has 18 stores in Ahmedabad Located in areas of high footfalls like movie theatres. restaurants. Use personal care. Dairy products.2. Place Generally located in small Generally more. shopping malls. home care. range of apparels Assortment general merchandise and a but focus on specific product basic . and Daily vegetables. wide range across fresh fruits Frozen cosmetics products Items. Promotion The main idea behind every Large size promotional offer effort is to make a bulk banner purchase Saturday and Special at the on – entrance private visual offers Audio Sunday are considered as labels displayed near the discount and scheme day entrance Two types of offer: BOGO promotion of private label BXGY Rebates and Premiums products New concept: Color focusing on bill value Audio Slips visual tools been employed based on product pricing Introduction of $ store concept Promotional schemes parasite 4. and Less Groceries. more supermarkets include a Vegetables. etc. Product combined Attractive with offer vodafone Mobile store kiosk names like ‘July mein Dhulai’ Strictly vegetarian Product The product offerings of the Mix consists of Fresh Fruits. 3.
Pricing Discount length thereby turn on of bulk Supply other kids items were nearby firm Separate entry and exit Fruits items were in display conditioning levels at the front end of the store buying marked down by a Low prized Private labels Private label products were Measures taken to reduce the substantial margin Intelligent Chain pricing strategies for private directly labels were defined so that purchase to from farmers. colorful but stores have been designed by the retail Higher leading design air cramped Separate entry and Fitch. premium and select ranges Variety is a promise delivered across the store 5. at store model of Reliance Fresh convenient full-fledged supermarket navigation locations The with requires far less space than a layouts that allow ease of product Most of these outlets need display is well organised and around only 2. have a strong emphasis on fruits and daily use items merchandise apparels more. Hypermarket general stores also and dairy products.000 sq. also has a range of products from its own stable available across value. Presentation The pure foods convenience bright and clean stores. Two times supply of best . which is in customers could not compare sent distribution with usual goods promises in market pricing.categories like vegetables. detergents.000-5. exit point Chocolates and international cash counter Vegetables and points near entry gate 6. facilitates ease of choice The ft Simple. centre.
up directly with farmers to source fresh fruits. shopping program Clubmore.vegetable and fruits daily to Linking ensure “fresh”.. which solutions and savings. vegetables and staples ensure great quality as well as great price provides customised the membership convenience. .
Brand Image 6. Brand name Food bazaar Spencers More Outlet supermarket supermarket supermarket Level of operation national national national ownership Future group RP Group Aditya birla Key elements 1. Strengths Food bazaar Grocery perishable Less than Mrp Spencer Grocery perishable.Competitive analysis Reliance fresh has following competitors at national level: S no. Quality Okay . 2. apparels Mrp More Grocery perishable Mrp Neighbourhood Stores/ Grocery perishable Mrp Reliance fresh Grocery perishable Mrp Quality Touch and feel offered Fresh quality at reasonable price Strong financial support poor Discount/value quality store Touch and feel offered Low price and best quality Strong financial support and huge assortment Okay Touch and feel offered quality Strong financial support and huge assortment Good convenient Mom and pop store Touch and No touch and feel feel offered convenient Trust and relationship Local presence Customer relationship and credit provided poor 7. Prices 3. Positioning 4. Product range 2. 3. 1. Store format 5.
Reliance Fresh must stress target marketing i. 5. Marketing Strategies: Bold and effective store front and signage.e. Feedback from loyal customers & working according to their needs. Reliance Fresh can move from direct sales model to online sales. 2. merchandising. Operational Strategy: Team-based management of store operations Many personnel.Strategies followed by Reliance 1. Business Strategy: Identifying business objectives and decide where to invest to best achieve those objectives. 3. Growth Stretegy: New stores and acquisitions of small owner-managed chains in desirable markets. . DIFFERENTIATION STRATEGY: In order to survive because of price competition from retail giants. and operating decisions made at store level Buying responsibility at the national and regional levels for volume discounts Own and operate many distribution centers 4. Instead of pleasing everyone decide which segment to please and then differentiate from the market.
PEST Analysis. Custom duty has been substantially reduced. Corporate taxes are also reduced.Food Industry POLITICAL FACTORS: Most of the processed food item has been exempted from licensing except alcoholic beverages. Food industry is one of the growing areas identified for exports. All profit from sales are exempted from Corporate Tax. Fruit. Income tax rebate allowed. vegetable & Dairy machineries are completely exempt from Central Excise Duty. . FDI up to 100% is permitted through automatic route. No industrial license is required for almost all of the food & agro processing industries except – Alcohol.
India’s share in global food trade is increasing from 1. Increase in nuclear families. Inflation: more inflation leads to search for close substitute. TECHNOLOGICAL FACTORS: Technological development for fast billing and service.ECONOMIC FACTORS: Food industry is growing at 13% despite of economic slowdown. store management. It is expected to witness 50% increase in investment in 2012(investment in infrastructure of retail industry). . Shift in product and service preferences. Life style changes. oracle. Introduction of organic fruits and vegetables by changing the means of agriculture to organic family. Population growth which leads to more production. Better applications of IT in modern retail industry like supply chain. Declared priority sector in 1999. Increase in working women proposition.5% to 3%. SOCIAL FACTORS: Eating habits of Indians are changing. Income of consumer: higher the income more is the consumption of food. CRM. Increasing personal health consciousness among Indians . Growing middle class.