CASE:

Problem statement:

VNFP is an export-oriented company supplies pickled and preserved product also known as
Chilli Company. During 2005 preserved category emerged as the largest contributor to
exports with 58 percent share, followed by provisionally preserved (35 percent) and fresh (7
percent) categories. Processed products business increased rapidly. So to remain in the market
I, Madhu, MD and Proprietor of VNFPP has to decide if Lemon drink must be launched or
not?
Decision:

There were 3 options for leftover lemons:

1. selling them in the open market and (if possible) recover the cost;

2. pickling/preserving them and hunt for customers who would require such sizes; or

3. processing them and selling them in a different form altogether

I have decided to launch the lemon drink locally in Bangalore.

Reasons behind decision:

 As VFNPP has been dealing in bulk supplying of preserved vegetables to the

intermediaries which were then responsible for bottling and canning to provide to end
users. This gave the intermediaries bargaining power and my company was not able to
influence the consumer preferences. We had to fulfil orders as per the terms laid by
the intermediaries.
 I have come up with the realisation that the image of VFNPP needs to be changed
from bulk supplier to a processor (bottler or canner) as it had advantage of controlling
the product packaging which could then help in shaping consumer preference.
However, as starting a bottling/canning unit will mean more cost, I have decided to
open it separately, it is expected to get ready by June 2012.
 IT has grown in India over the past years, employees are sent overseas as part of IT
project. These are our target customers, as they associate canned product with
westerners and unlike the Indian mentality do not think that canned foods are harmful.
 The idea will be to market product on word to mouth strategy. We will provide the
drinks to people working in IT industry and since our company has edge of product
quality over our competitors also we will have first mover advantage in canned
products market, I think we will be able to make a profitable product.

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