ECONOMICS PROJECT

ON

BREAKFAST CEREALS
MEANING :A breakfast cereal (or just cereals) is a food made from processed grains that is often, but not always, eaten with the first meal of the day. It is often eaten cold, usually mixed with milk. The breakfast cereal industry has gross profit margins of 40-45%, HISTORY:[1]

90% penetration in some markets,

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and steady and continued growth throughout its history.

20th century
In 1902 Force wheat flakes became the first ready-to-eat breakfast cereal introduced into the United Kingdom. The cereal, achieved wide success in Britain, at its peak in 1930 selling 12.5 million packages. AFTER THE WORLD WAR 2, THE GENERAL MILLS ENTERED IN THE MARKET IN THE YEAR 1924,WITH WHEATIES increasingly started to target children. Kelogg Kellogg's was founded as the Battle Creek Toasted Corn Flake Company on February 19, 1906, by Will Keith Kellogg . Kellogg Company , is a producer of cereal and convenience foods, including cookies, crackers, toaster pastries, cereal bars, fruit-flavored snacks, frozen waffles, and vegetarian foods. The company's brands include Corn Flakes, Keebler, Pop-Tarts, Eggo, Cheez-It, Nutri-Grain, Rice Krispies, Bear Naked, Morningstar Farms, Famous Amos,Special K, All-Bran, Frosted Mini-Wheats, Club Crackers and Kashi. Kellogg products are manufactured in 18 countries and marketed in more than 180 countries around the world.
[2]

Kellogg's Earnings Grow 13% in Second Quarter

A strong focus on cost-saving measures helped propel Kellogg Co. to better-than-expected financial results for the second quarter of fiscal 2009. While net sales for the quarter, at $3.2 billion, were down 3% from the same quarter a year ago, net earnings reached $354 million, a 13% increase over the same period one year ago. Earnings per share were 92 cents for the quarter, which represents a year-over-over increase of 12% on a reported basis. Operating profit of $553 million was a 4% increase over the same period a year ago. The consumer-packaged goods company said up-front costs for cost-reduction initiatives were about 7 cents per share in the quarter. Kellogg stated that it is on track to deliver $1 billion in annualized savings from efficiency initiatives by year-end 2011. Kellogg raised its full-year 2009 earnings-per-share guidance to a range of 8% to 10% on a currency-neutral basis. That includes a significant increase in up-front charges for cost-reduction initiatives to 26 cents per share from an initial forecast of 14 cents per share.

Kellogg's Global Sale

Kellogg's commands 40% of global breakfast cereal sales & makes about 50% of Asian prepackaged cereals.
According to Kellogg's 2006 annual report, full-year revenues were US$11 billion making Kellogg's the world's leading producer of ready-to-eat cereal products.

The future of FMCG

Fast moving consumer goods will become a Rs 400,000-crore industry by 2020. the FMCG sector witnessed robust year-on-year growth of approximately 11 per cent in the last decade, almost tripling in size from Rs 47,000 crore in 2000-01 to Rs 130,000 crore Growth was even faster in the past five years almost 17 per cent annually since 2005. It identifies robust GDP growth, opening up of rural markets, increased income in rural areas, growing urbanisation along with evolving consumer lifestyles and buying behaviours as the key drivers of this growth.