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CPG comprised of manufacturers, wholesalers and retailers.

Competitors from standalone niches to integrated firms Globally profit margins were generally low for CPG cos. 3 factors influencing consumers decision to buy price, brand loyalty and impulse In most developing countries including India, CPG business dominated by indigenous players at provincial levels. Distribution a key success factor in the business. The global CPG industry grew by 2.5% in 2006 Beverages, home care products, snack food products, health-care products - growth categories. CPG industry in India $ 13.1 billion(excluding soft drinks and tobacco products) Foods (including groceries) comprised 44% of CPG sales. Opportunity : The Indian CPG market was fragmented, with over half the sales accounted for by mom-andpop outfits making and selling unbranded and unpackaged goods. This presented an opportunity for consolidation through economies of scale for makers of branded products. Daburs product portfolio consisted of categories that were under penetrated and highgrowth. The companys positioning on the health and wellness platform, backed by its differentiated herbal image. Well placed to capture future growth in the Indian CPG market. Challenges : Building brands was challenging in the Indian context. National coverage was difficult, particularly for new entrants. There were over 6 million retail outlets in the country- (with 4 million in the rural sector) The supply chain was underdeveloped and logistics were costly and challenging. CPG market was growing fastest in the world in the world in India. The population was young, dynamic and willing to try new products. Indian CPG market was projected to grow almost three fold by 2015 to $33.4 billion. Growth was expected in the personal care, food, beverages and household care categories. Established in 1884 by Dr S K Burman By 2007 Dabur manufactured over 450 products.

Sold in the domestic market Network of 1.5 million retail outlets, 47 C&F locations and 5000 distributors. Consolidated sales turnover of Rs 22.6 billion for the year ending March 2007 Four business units: Consumer care, Consumer healthcare, foods business, foods business and international business. Consumer care Hair care Oral care Health supplements Digestives and candies

Consumer healthcare Prescription and over-the-counter medicines Foods business Fruit juices Cooking pastes Sauces Bulk items for institutional customers

International Business division Manufactured and marketed products for overseas markets Eight manufacturing plants in India Two main factories Six support factories

Production units outside India Birganj (Nepal) Dhaka (Bangladesh) Dubai (UAE) Cairo (Egypt) Lagos (Nigeria) Unique among CPG peers Products are derivatives of Ayurveda Products are priced and targeted for mass market One of the few heritage company in India

The niche created by Ayurveda provided differentiation and insulation from competitors Strong internal R&D. Promoted large scale farming of herbs. For example large players used coconut in hair oils, Dabur used amla. Sales force focussed on channels Sales force dedicated to key grocers, mass grocers, chemists, modern retail outlets and wholesale in towns. Rural market provided 50% of total sales had its own sales team Company was moving from one-off discount schemes towards long-term loyalty programs that encouraged channel partners to purchase more throughout the year. Implementing software channel to capture data on stock levels at stockists and to asses the effectiveness of promotions and design schemes for particular regions and products. Independent supply chain for each of its four business segments. Indian consumers in Middle East were familiar with Dabur as a brand and preferred its traditional products. Sales outside India accounted for less than 6% of turnover. In 2003 company articulated on vision becoming international. Dabur floated Dubai-based subsidiary, DIL for its global operation. By 2006 Dabur had established five manufacturing units overseas. Products exported to more than 50 countries, including Middle East, Southeast Asia, Africa, the European Union and America. International business contributed 11% of consolidated sales for the period 2005-06. Current goal was to step up international sales to 20% of revenues by 2012. All international operations streamlined under DIL DIL had seven subsidiaries. Existing international markets categorized into strategic and opportunistic markets in order of priority for allocation of managerial time. Strategic markets were further classified into potential markets and focus markets in order of priority for allocation of financial and human resources. Dabur had already identified 20 focus countries in which to establish manufacturing and marketing facilities.

The first comprised : Asian markets (Pakistan, Bangladesh, Nepal, Sri Lanka and Malaysia) Developed markets (United States and United Kingdom) Health-care business in CIS countries (Russia being largest) The above three supported by the companys export oriented unit in India and by the local manufacturing units in Nepal and Bangladesh. The second portfolio included markets in the member-countries of Gulf Cooperation Council (GCC), Africa (Egypt, Nigeria, Sudan and Morocco) other Middle-Eastern countries like Iran and Iraq, and the personal care business in CIS countries. This was to be supported by manufacturing facilities in Dubai, Cairo and Lagos. Strategy for international business: Segmentation model to identify the markets for entry in geographies designated as focus markets. Plan to leverage the natural platform. To grow both organically and inorganically.

Bangladesh, Nigeria, UAE, UK --- net loss