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Snacks & Namkeens
Snacks & Namkeens
The Research was a good experience & the final conclusion is that the
consumers generally associate Ready-To-Eat Snacks & Namkeens with Time
Pass. Majority of them prefers wafers to be their first choice with Fraiams being
the second preference. Namkeens on other hand are usually preferred as
hunger quencher and are eaten whenever the consumers are hungry.
INTRODUCTION ______________________________________________02
PROBLEM STATEMENT_________________________________________03
RESEARCH OBJECTIVE_________________________________________03
INDUSTRY OVERVIEW _________________________________________04
CATEGORIES & PRODUCT OVERVIEW __________________________05
POTATO CHIPS__________________________________________05
BANANA CHIPS _________________________________________06
NAMKEENS_____________________________________________07
FUN-FOODS____________________________________________09
PACKAGING ______________________________________________10
COSTING & PRICING________________________________________11
DISTRIBUTION ____________________________________________11
CONSUMER PROFILE________________________________________12
SAMPLING DESIGN ___________________________________________15
RESEARCH DESIGN ___________________________________________15
DATA COLLECTION____________________________________________16
DATA ANALYSIS______________________________________________16
RETAILERS POINT OF VIEW __________________________________17
CONSUMERS POINT OF VIEW_________________________________22
MARKETING & ADVERTISING STRATEGY___________________________26
FACTS & FIGURES ____________________________________________27
CONCLUSION & RECOMMANDATION______________________________28
APPENDIX___________________________________________________29
QUESTIONAIRE FOR RETAILERS_______________________________29
QUESTIONAIRE FOR CONSUMERS _____________________________30
BIBLIOGRAPHY_______________________________________________31
N.L.DALMIA INSTITUTE OF MANAGEMENT STUDIES AND RESEARCH
INTRODUCTION:
India is one of the world’s major food producers but accounts for less than
1.5 per cent of international food trade. Food exports in 1998 stood at US$5.8
billion whereas the world total was US$438 billion. The Indian food industry’s sales
turnover is Rs. 140,000 crore annually as at the start of year 2000.
Exports of food products can become a valuable growth driver for the Indian
food industry, leveraging the historic base and new specialty categories where India
has great potential to emerge as a strong brand abroad, according to the latest
update on the industry by McKinsey
It pointed out that mass market of basic foods, value added foods and exotic
foods and their exports were the main opportunities for the Indian food industry
adding that there will also be a significant growth in terms of input providers,
logistics suppliers and retail.
Indian snack food industry comprises of many Indian as well as MNCs. The
Indian snack market reached a value of $307.7 million in 2001. It is one of the
largest snack markets in the Asia-Pacific region. Only Australia, China, Japan and
South Korea have won greater revenue from the sale of snacks. India contributes
three percent to the total Asia-Pacific snack market revenue.
PROBLEM STATEMENT
To find out consumers buying behavior and purchase habits for Ready-To-
Eat Snacks & Namkeens.
RESEARCH OBJECTIVE
Factors affecting the buying pattern of the consumer for Ready-To-Eat Snacks &
Namkeens.
INDUSTRY OVERVIEW:
The Indian snacks food market is of the order of 400,000 tonnes. At a low
average price of about Rs.35-60 a kg. Largest share of this Rs.14 bn market still
remains with unorganized sector comprising of local manufacturers. There is a wide
range of product categories differentiated based on taste. This wide range of
products are categorized under Potato / Banana Chips, Namkeens & Fun-Foods.
The organized market for chips is estimated to be 6500 tons valued at Rs.2 bn.
The market for branded chips has been growing at a fast pace of around 20-25 %
annually. Heavy promotions by branded chipmakers (like offering free gifts, toys etc
with these products), has led to a major shift from unbranded to branded products.
As per the views of MR. L.M AGARWAL (Executive Director of SM FOODS the
manufacturers of PEPPY/PIKNIK) today the trend is shifting from unorganised to
organised. So, the overall growth in the snacks food segment is happening between
10%-15% annually. However in the organized sector, the growth is happening at
50%-100% annually. The market is forecasted to reach a value of $459 million in
2006.
POTATO CHIPS:
MARKET PLAYERS:
There are many others in the local organized sectors like Chheda, Raghuvansi etc in
this category operating locally in a particular location.
Recently Haldirams has come-up with new range of potato chips in three
different tastes i.e. Paprika Chips, Pudina Treat and Classic Salted. Haldirams chips
are also available in 75 GM packs for Rs.10/- as an inaugural offer.
PROJECT REPORT ON READY-TO-EAT SNACKS 5
N.L.DALMIA INSTITUTE OF MANAGEMENT STUDIES AND RESEARCH
MARKET LEADERS:
TARGET AUDIENCE:
Generally Potato Chips are targeted towards all age groups differentiated in
taste. For e.g. Premium Chips (Normal salty chips) are targeted towards Kids & Old
age group due to their softness, even further it is more specifically targeted based
on taste, like Premium Salted is targeted towards kids and Both Premium salted /
Spicy are targeted toward all age groups.
BANANA CHIPS:
MARKET PLAYERS:
PRICE
BRANDS PRODUCT PACKAGE
RANGE
GARDEN Packed in Polly Propane Plastic
Black Pepper Pouch with pre-printed Brand
Rs. 120 /-
Salty Yellow Name & Logo, Item Name &
Per Kg
Spicy Red Package Details and MRP and
Expiry Date
Black Pepper Packed in Polly Propane Plastic
JANTA Rs. 100 /-
Salty Yellow Bags With Brand Name and Price
Per Kg
Spicy Red Tags.
Black Pepper
OTHERS Rs. 80 /-
Salty Yellow Packed loose in plastics bags
Per Kg
Spicy Red
There are no recognized brands in this category. The majority of the banana
chips sector is captured by local manufacturers distributing it loose to the retailers,
who then packs it in 150gm (Rs.12/-), 250gm (Rs. 20/-) & 500gm (Rs. 35/-) in a
normal plastic bags with only price stickers stuck to it. Tomato punch to this
category of chips has been a runaway success.
MARKET LEADERS:
Majority of the market share i.e. 65% is divided amongst the unorganized
sector distributing it locally, Garden being the major player amongst the local
brands with 27% and the remaining is distributed amongst the other local brands
like Raghuvansi, Janta, Chedda, etc.
TARGET AUDIENCE:
Banana Chips like potato chips are targeted towards all age groups; the
Spicy Red Flavor is generally targeted to young and middle age groups whereas the
tomato punch is targeted towards kids and old age groups.
NAMKEENS:
MARKET LEADERS:
There are many other local manufacturers with different varieties of namkeens
ranging from Rs.60 to Rs.80 per kg. Fried Cashews and other dry fruit items are
most costly ranging from Rs.200 to Rs.250 per kg and are generally available loose
as per the consumer's requirements.
MARKET LEADER :
TARGET AUDIENCE :
Namkeens are generally targeted towards all age groups and the target
differentiated is based on regional taste preference for e.g. Bhujia's are famous in
Rajasthan whereas Chevada's are famous in Gujarat & Fried Cashews is most
preferred in Goa.
FUN-FOODS:
MARKET PLAYERS :
There are many local players in this category that deal only in FRAIAMS and
others fried Fun-Foods. Generally Consumers are willing to purchase the branded
ones because they come in many different tastes like Red Chili Chatka, Cheseeballs
etc.
MARKET LEADER :
Since they are very few players in this category, PEPPY Products holds
majorities of the market share especially Cheeseballs & FRAIAMS. Frito's-Kurkure is
new to the market but still is at the second place. Bonkers and others cover a small
segment.
PACKAGING:
Leading players try to woo consumers with attractive packaging and designs.
Generally all branded companies uses the technology of packing the product with
nitrogen filled aluminum vacuumed pouches, which help to keep the product fresh
for a longer shelf life, but also increases the cost. Smaller manufacturers like
Garden Foods, Raghuvanshi Exports, Janta etc use Polly Propane plastic pouches for
packaging the products.
The pouches are pre-printed with Company Name, Brand Name, Product
Name, Ingredients, Mfg. Date & Best Before Date. MRP is then stamped by a
machine before packing the products.
Generally these packs are provided to the retailers in a series (Lar Form)
with a hanging stand. When the products are to be distributed outside the country
or in a bulk then the pouches are packed in Boxes with Company Name, Item Name
& Brand Name printed on it.
Raw material and packaging are the two major cost components. The
organized players follow rigorous quality control of raw material and maintain high
hygiene standards at their manufacturing facilities. This results in a much higher
cost of production, thereby making them price uncompetetive in comparison to
there small scale unorganized counterparts.
Packaging is a major cost, accounting for half the price of the product.
Normal Polly propane plastic bags costs on an average Rs.2 per pack whereas the
aluminum packs costs around Rs.2 to Rs.4.5 approximately based on size. The
Boxes cost around RS.5 (Minimum) to Rs.32 (Maximum) based on size and quality.
For e.g. A 55gm pack of Frito's-Kurkure is pricing around Rs.10 of which Rs.3
is distributed amongst Distributors & local Retailers. Out of the remaining Rs.7
Companies profit is around Rs.1.75 to Rs.2. Packaging costs around Rs.2 and
distribution and manufacturing costs around Rs.3 to Rs.3.25.
DISTRIBUTION:
Distribution is also one of the key parameters for expanding market share.
Frito-Lays has the advantage of access to Pepsi's a formidable distribution network
whereas products like Uncle Chipps is retailed through around 600000 outlets
across the country.
Generally Companies are having their sales vehicles that are loaded on daily
basis and are distributed to local retailers. Some companies appoint Distributors.
Distributors have to give a proposal with a market research like storage facilities,
infrastructure, retail outlets in area, market leader, types of products available in
the market etc. In some companies the products are delivered to the retailer twice
a week (e.g. Frito India), while in some companies on daily basis (e.g. Garden).
The products are generally sent in Boxes on an average each box contains 80 packs
of 30 gm or 30 packs of 150 gm.
Distributors are solely responsible for the sales in the particular area he is
operating in. Every Distributor should have a specified number (varying from
company-to-company) of minimum shops in his area. Distributors generally have
small vans (rickshaws) and employ salesmen on commission basis who loads the
products from the distributors storage and distributes it amongst the retailers.
CONSUMER'S PROFILE:
Snacks like Wafers & Chevadas are generally preferred for the daily
consumption whereas fun-foods like Cheeseballs and Twistys are sold more in
schools, Colleges, Railway Platforms and Movie Theatres. Kids generally prefer Fun-
Foods whereas all age groups generally prefer Wafers and other snacks.
Taste varies widely across the regions. For instance in South, banana chips
are extremely popular which do not find many acceptances in other parts of the
country. In east, Paaprichaat is very successful whereas in Mumbai, tomato punch
has been a runaway success.
SAMPLING DESIGN:
TARGET POPULATION
The respondents are classified in two categories i.e., Retailers & Consumers.
Retailers are surveyed to know the actual purchase of the consumers; whereas the
Consumers are surveyed to know their preference. All the respondents were above
the age of 18 and are residents of Mumbai city .
The sampling was done on a random basis whereby the respondents visited and
primary data is collected. The Respondents were selected as per convenience
sampling.
RESEARCH DESIGN:
A research design expresses both the structure of the research problem and plan of
investigation used to obtain empirical evidence on relation s of the problems. The
research design was Exploratory in nature. The Exploratory research is done to
provide insights into, and an understanding of, the problem confronting the
researcher.
As Exploration research serves the other purposes like the area of investigation
may be so new or so vague that a researcher needs to do an exploration just to
learn something about the dilemma facing the manager.
The Exploratory research benefits from the use of the following methods:
1. Survey of Experts.
2. Pilot Surveys.
3. Analysis of Data.
4. Qualitative Research.
Secondary Data and the Data from the Questionnaire were used to do the Analysis.
This Exploratory research was done to give the insights about Consumers buying
behavior. The factors affecting their purchase of Ready-To-Eat Snacks & Namkeens
DATA COLLECTION:
Another advantage of the questionnaire is that it minimizes the response error. The
Secondary Data was collected through Internet, Business journals.
The questionnaire was designed keeping the overall objectives and the information
required. The questionnaire given to Retailers was aimed to finding out the present
DATA ANALYSIS :
Data Analysis is being done arranging the data in tabular forms. Graphical
Representation and using SPSS Software.
Out of the 50 retailers surveyed 26 of them feels that the consumers generally
prefer Wafers as the best form of Ready-To-Eat Snacks as they are available in
many flavours which gives them a variety to choose. Whereas 15 believe that
Namkeens are usually preferred & 9 has the opinion that Fraiams are mostly
preferred.
Cumulative
Frequency Percent Valid Percent Percent
Valid Wafers 26 52.0 52.0 52.0
Namkeens 15 30.0 30.0 82.0
Fraiams 9 18.0 18.0 100.0
Total 50 100.0 100.0
N Valid 50 50 52
Missing 0
Mean 1.6600 40
Std. Error of Mean .1092
Median 1.0000 30
Mode 1.00 30
Maximum 3.00 10
Wafers Namkeens Fraiams
30
Count
consumer asks for
20 21
yes, but
accepts noccepts
Count
yes they do anything anything Total
Brand branded 6 4 1510
preference Unbranded 21 21 consumer asks for
anyhing 10
4 15 19
yes they do ask for
Total 6 29 15 50
yes, but accepts any
6
Out of the 50 retailers surveyed 4 4 thing
consumers 60% of them are brand loyal, whereas 40% of them prefer whatever is
available. 42% of consumers do initially asks for brand but they also fall in the
category of the 40% of the consumers who asked for brand i.e. they prefer
whatever is available. Remaining 38% of the consumers are not worried about
brand they just ask for particular product and buy branded if available or anything.
10% say that they buy 3-4 packs. Only 2% WHICH SIZE IS PREFERRED
of the retailers say that they buy 5-6 packs. This clearly depicts that Ready-To-Eat
Snacks and Namkeens are generally considered as Time Pass Food and are not
generally stocked by the consumers.
Cumulative
Frequency Percent Valid Percent Percent
Valid RUFFLES 13 26.0 26.0 26.0
LAYS 11 22.0 22.0 48.0
HALDIRAM 15 30.0 30.0 78.0
GARDEN 6 12.0 12.0 90.0
PROJECT REPORT
JANTAON READY-TO-EAT SNACKS
5 10.0 10.0 100.0 19
Total 50 100.0 100.0
N.L.DALMIA INSTITUTE OF MANAGEMENT STUDIES AND RESEARCH
Statistics WHICH BRAND STORED
WHICH BRAND STORED
JANTA
N Valid 50
10.0%
Missing 0 RUFFLES
Mean 2.5800 GARDEN 26.0%
Median 3.0000 12.0%
Mode 3.00
WAFER 7 15 28 50
NAMKEENS 2 39 9 50
FRAIAMS 35 9 6 50
Out of the 50 Surveyed Retailers 28 of them feels that old age consumers prefer
Wafers. 15 of them feel that young age people prefer Wafers, whereas 7 feel that
children's prefer Wafers. As far as Namkeens are concerned 39 of them says Young
prefers Namkeens most, Whereas 9 feels old prefer Namkeens and only 2 feels that
children's prefer Namkeens. In case of Fraiams 70% of them agrees that Children's
are more interested in Fraiams i.e. Cheese Balls etc., whereas 18% of young &
12% of the old age consumers are interested in eating Fraiams as Ready-To-Eat
Snacks & Namkeens.
Product Association
Cumulative
Frequency Percent Valid Percent Percent
Valid Time Pass 21 42.0 42.0 42.0
Tasty Food 18 36.0 36.0 78.0
Hunger Quencher 11 22.0 22.0 100.0
Total 50 100.0 100.0
Product Association
30
F re q u e n c y
20 21
18
10 11
Product Association
Cumulative
Frequency Percent Valid Percent Percent
Valid Whenever Feel Hungry. 28 56.0 56.0 56.0
During Movies or while
18 36.0 36.0 92.0
watching TV
Any Time of the day 4 8.0 8.0 100.0
Total 50 100.0 100.0
Symmetric Measures
Asymp.
a b
Value Std. Error Approx. T Approx. Sig.
Interval by Interval Pearson's R -.312 .148 -2.274 .027c
Ordinal by Ordinal Spearman Correlation -.319 .145 -2.329 .024c
N of Valid Cases 50
a. Not assuming the null hypothesis.
b. Using the asymptotic standard error assuming the null hypothesis.
c. Based on normal approximation.
Count 28
how often purchased
on regular
NO OF CONSUMERS
MOST PREFERENCE 28 23 12
GENERALLY PREFERENCE 18 18 30
LEAST PREFERENE 4 9 8
TOTAL 50 50 50
Out of 50 surveyed
consumers 28 of them
prefer wafers, 23 of
them prefer Namkeens
and only 12 of them has
the Fraiams as there
most preferred option.
As far as the 2nd
preference of the
consumer is concerned
18 of them prefers
Wafers, 18 prefer
Namkeens and 30
prefers Fraiams. With reference to the consumers least preference only 4 of the 50
surveyed consumers prefer wafers as their last option; whereas 9 of them has
Namkeens as their last option and 8 of the has Fraiams as their last option. Fraiams
as whole is generally been selected as substitute to Wafers & Namkeens.
Companies like Garden Foods have their distribution vehicles painted with the
product name and item names that move around the market, which in a way
is publicity for them. They even organize a snack fair once in a year in
Bandra Reclamation Club and invites other manufacturers to have their stalls
in the fair.
Companies generally provide iron racks to be kept in the retail shops for
which the retailers are given a margin of 4% to 5% extra. Companies like
Frito-India on regular basis send some marketing tips to their distributors.
SM Foods PEPPY has also launched certain promotions for both its dealers
(scratch and win contests) and consumers (Wheels and Wings, a do it
yourself toy) to make its brands more popular.
Generally the company launches a new product in the market and then starts
advertising on media and the POPs and other promotional activities back these ads
by the companies.
SM Foods has earmarked more money for marketing this year and is
spending close to Rs.5 crore on a media blitz.
Uncle Chipps a Delhi based food products company has an annual turnover of
Rs600mn.
Due to lack of brand loyalty product reach and availability is most important
for increasing the market share, so Distribution channel plays a major role.
Companies need to encourage their distributors with some incentives or gifts.
Companies should provide proper training on marketing and sales to their
Distributors as well as Sales Force.
3. Does the consumers asks for the particular flavour or they prefer any flavour?
Yes, they do ask for particular flavour but if not available prefer whichever is
available.
Yes No
5. Rate the products from 1-3 among as per your preference (With 1-most
preferred 3-least Preferred)?
BIBLIOGRAPHY:
I thank the following people for providing valuable information & guidance
Local Retailers
Consumer Respondent