CHAPTER 1 - INTRODUCTION

1.1. INTRODUCTION TO NESTLE:

Figure No. 1.1 - Logo of Nestle

Nestlé is a Swiss transnational food and drink company headquartered in Vevey, Vaud,

Switzerland. It has been the largest food company in the world, measured by revenues and

other metrics, for 2014, 2015, and 2016.It ranked No. 72 on the Fortune Global 500 in 2014

and No. 33 on the 2016 edition of the Forbes Global 2000 list of largest public companies.

Nestlé's products include baby food, medical food, bottled water, breakfast cereals, coffee

and tea, confectionery, dairy products, ice cream, frozen food, pet foods, and snacks.

Twenty-nine of Nestlé's brands have annual sales of over CHF1 billion (US$1.1billion),

including Nespresso, Nescafé, KitKat, Smarties, Nesquik, Stouffer's, Vittel, and Maggi.

Nestlé has 447 factories, operates in 194 countries, and employs around 339,000 people. It is

one of the main shareholders of L'Oreal, the world's largest cosmetics company.

Nestlé was formed in 1905 by the merger of the Anglo-Swiss Milk Company, established in

1866 by brothers George and Charles Page, and Farine Lactée Henri Nestlé, founded in 1866
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by Henri Nestlé (born Heinrich Nestle). The company grew significantly during the First

World War and again following the Second World War, expanding its offerings beyond its

early condensed milk and infant formula products. The company has made a number of

corporate acquisitions, including Crosse & Blackwell in 1950, Findus in 1963, Libby's in

1971, Rowntree Mackintosh in 1988, and Gerber in 2007.

Nestlé has a primary listing on the SIX Swiss Exchange and is a constituent of the Swiss

Market Index. It has a secondary listing on Euronext. In 2011, Nestlé was listed No. 1 in

the Fortune Global 500 as the world's most profitable corporation. With a market

capitalization of US$239.6 billion, Nestlé ranked No. 11 in the FT Global 500 2014.

1.1.1. NATURE OF NESTLE:

1.1.1.1.NESTLÉ India is a subsidiary of NESTLÉ S.A. of Switzerland. With eight factories

and a large number of co-packers, Nestlé India is a vibrant Company that provides

consumers in India with products of global standards and is committed to long-term

sustainable growth and shareholder satisfaction.

1.1.1.2.The Company insists on honesty, integrity and fairness in all aspects of its business

and expects the same in its relationships. This has earned it the trust and respect of

every strata of society that it comes in contact with and is acknowledged amongst

India's 'Most Respected Companies' and amongst the 'Top Wealth Creators of India'.

1.1.1.3.The NESTLÉ Corporate Business Principles are at the basis of our Company‘s

culture, developed over 140 years, which reflects the ideas of fairness, honesty and

long-term thinking.

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1.1.2. PRODUCT RANGE OF NESTLE:

1.1.2.1.Milk Products:-

 Nestle Milkpak UHT Milk

 Milkpak Butter

 Milkpak UHT Cream

 Milkpak Desi Ghee

 Nestle Everyday

 Nestle Nido

1.1.2.2.Chocolate Drinks:-

 Milo power

 Milo RTD

1.1.2.3.Coffee:-

 Nescafe Classic

1.1.2.4.Fruit Drinks:-

 Frost

 Nestle Orange Juice

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1.1.2.5.Dietetic & Infant Products:-

 Lactogen

 Cereals

 Nestle Rice

 Nestle Wheat

 Neslac

1.1.2.6.Culinary Products:-

 Maggi Noodles

o Maggi Vegetable Multigrainz Noodles

o Maggi 2-Minute Noodles

o Maggi Vegetable Atta Noodles

o Maggi Cuppa Mania

 Maggi Cold Sauces

1.1.2.7.Confectionery:-

 Nestle Milkpak

 Polo Mint

 Kitkat
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1.1.2.8.Water:-

 Nestle Pure Life

1.1.3. VISION AND MISSION OF NESTLE:

1.1.3.1.Vision of Nestle:

―To be a leading, competitive, Nutrition, Health and Wellness Company delivering improved

shareholder value by being a preferred corporate citizen, preferred employer, preferred

supplier selling preferred products.‖

1.1.3.2. Mission of Nestle:

"Nestlé is the world's leading nutrition, health and wellness company. Its mission of 'Good

Food, Good Life' is to provide consumers with the best tasting, most nutritious choices in a

wide range of food and beverage categories and eating occasions, from morning to night."

1.1.4. ORGANIZATIONAL STRUCTURE OF NESTLE

Nestlé has a Board of Directors, led by our Chairman Peter Brabeck-Letmathe, who was the

former Nestlé CEO. The day-to-day management of the Nestlé business is taken care of by

our Executive Board. The designated Board Members manage diverse parts of the global

business. The Nestlé Group is managed by geographies - Zones EMENA (Europe, Middle

East and North Africa), Americas and Asia/Oceania/sub-Saharan Africa - for most of the

food and beverage business, with the exceptions of our globally managed businesses, which

include Nestlé Waters, Nestlé Nutrition, Nespresso, Nestlé Health Science and Nestlé Skin

Health.

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Figure No. 1.2 – Organization Structure of Nestle

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1.1.5. SWOT ANALYSIS OF NESTLE:

1.1.5.1. Strengths of Nestle:

 Nestle is a highly-diversified company operating in many different markets and

sectors of those markets.

 The variety of brands gives Nestle a strong ability to weather economics because it

serves many different segments of the market.

 It has well-established relationships with other powerful brands, including Coca-Cola,

Colgate Palmolive and General Mills.

 Nestle owns some of the world‘s most recognized and trusted brands. Some families

have used its products for generations. Gerber has historically been one of the most

trusted brands of baby food in the United States.

 It has strong research and development capabilities that are growing.

 Nestle has strong relationships with retailers.

 It includes well-established brands with a large amount of market share in some of the

largest national economies, including Europe and the United States.

1.1.5.2 Weakness of Nestle:

 Much of its sales depend upon a few well-recognized brands. This makes the

company vulnerable to any sudden changes in consumer behavior.

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 Grocery sales in some major markets are increasingly concentrated in the hands of a

few giant retailers such as Walmart and Kroger in the United States and Tesco in the

United Kingdom. These companies have the ability to force sharp reductions in price.

Some of these retailers are intent on supplementing name brand products with more-

profitable house brands.

 Some of its brands, such as Carnation milk, are not tailored to modern lifestyles and

are seen as old-fashioned by some customers.

 The company is heavily dependent upon advertising to shape consumer opinion and

drive traditional sales. This can lead to high marketing costs with a questionable

return on investment.

 There is a high cost for launching new brands to supplement older, less-fashionable

food products.

1.1..5.3. Opportunities of Nestle:

 Growth in online retail could open up new distribution channels such as Amazon

Prime that can bypass traditional retailers.

 Growing middle classes in nations such as China and India create larger and broader

markets for Nestle‘s products.

 Increased disposable income in countries like China could increase the demand for

luxury items like bottled water, ice cream and pet food.

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  Changes in lifestyle, such as longer work hours, more women in the workforce, and

more single-person households, increase the demand for prepackaged foods.

 Increased mobility and car ownership increase the demand for candy, bottled water

and snack foods in nations like China.

 Increased interest in health and nutrition could increase demand for some Nestle

products, such as energy drinks.

1.1..5.4. Threats of Nestle:

 Retailers such as Walmart, Kroger and Aldi are increasingly promoting house brands,

which are more profitable for them. House brands are often sold at a lower price and

given greater visibility on shelves. Some retailers such as Aldi and Trader Joe‘s

emphasize house brands at the expense of traditional products.

 There is pressure from large retailers such as Walmart to cut prices.

 The growing use of new retail channels such as Amazon Prime and dollar stores may

not favor traditional retail products.

 They have experienced disruption of the traditional grocery industry in countries like

the United States by new players such as Whole Foods Market and online retailers.

 There is a growing ineffectiveness of traditional advertising as new technologies such

as streaming video supplant traditional broadcast and print media.

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  Consumers in some countries are eating fewer meals at home, which means less

demand for some Nestle products. Bloomberg reported that Americans‘ spending on

restaurant meals overtook spending on groceries for the first in April 2015.

 A growing suspicion of prepackaged foods as unnatural and unhealthy in Europe and

North America is becoming common. This increases the demand for fresh and natural

foods in some markets. It also increases the demand for organic and other

alternatives.

 There is a possibility of increased government oversight and regulations in some

markets, such as India. India‘s government ordered billions of dollars of Maggi

instant noodles be pulled from the shelves in the summer of 2015 because of

allegations of excessive levels of lead in the product.

Despite the threats, Nestle still owns some of the world‘s best-recognized and most profitable

food brands. Unfortunately, it faces a dramatically-changing grocery market in which

traditional brands are losing much of their effectiveness. Such brands are heavily dependent

upon traditional advertising and marketing strategies such as television commercials, which

are often ineffective in today‘s world.

Changing patterns of consumer behavior, such as the demand for more natural food in

Europe and the United States and increased spending on take-out and restaurant food, could

be a greater threat to Nestle. It might have to create products or revamp brands simply to

maintain market share.

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1.2. FAST FOOD INDUSTRY

Fast food is a type of mass-produced food that is prepared and served very quickly. The food

is typically less nutritionally valuable compared to other foods and dishes. While any meal

with low preparation time can be considered fast food, typically the term refers to food sold

in a restaurant or store with preheated or precooked ingredients, and served to the customer

in a packaged form for take-out/take-away.

Fast food restaurants are traditionally distinguished by their ability to serve food via a drive-

through. Outlets may be stands or kiosks, which may provide no shelter or seating, or fast

food restaurants (also known as quick service restaurants). Franchise operations that are part

of restaurant chains have standardized foodstuffs shipped to each restaurant from central

locations.

Fast food began with the first fish and chip shops in Britain in the 1860s. Drive-through

restaurants were first popularized in the 1950s in the United States. The term "fast food" was

recognized in a dictionary by Merriam–Webster in 1951.

According to the National Institutes of Health (NIH), fast foods are quick alternatives to

home-cooked meals. They are also high in saturated fat, sugar, salt and calories. Eating too

much fast food has been linked to, among other things, colorectal cancer, obesity and high

cholesterol.

The traditional family dinner is increasingly being replaced by the consumption of takeaway,

or eating "on the run". As a result, the time invested on food preparation is getting lower and

lower, with an average couple in the United States spending 47 minutes and 19 seconds per

day on food preparation in 2013.

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The last several years have seen an absolute explosion of diversity in both restaurant concepts

and menu choices. This evolution reflects an industry that has been responsive to changing

consumer tastes as well as entrepreneurs finding niche opportunities to profit.

And rest assured - those opportunities still exist in abundance. The fast food industry is not

without its challenges, but it‘s clearly still possible to profit in the face of them.

1.2.1 The Industry

Globally, fast food generates revenue of over $570 billion - that is bigger than the economic

value of most countries. In the United States revenue was a whopping $200 billion in 2015 -

quite a lot of growth since the 1970 revenue of $6 billion. The industry is expected to have an

annual growth of 2.5% for the next several years - below the long term average but coming

back from a several year slump.

There are over 200,000 fast food restaurants in the United States and it is estimated that 50

million Americans eat at one of them every single day. The industry employs over 4 million

people and counting - restaurant franchises added over 200,000 jobs in 2015.

Consumers of fast food focus on taste, price and quality - in that order. While the food is often

highly processed and prepared in an assembly line, these restaurants focus on consistency of

experience, affordability, and you guessed it - speed.

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1.2.2. Fast food, specifically

Fast food restaurants, along with fast casual restaurants, make up a segment of the restaurant

industry know as Quick Service Restaurants (QSR). This segment accounts for more than

50% of sales in the entire restaurant sector. While Quick Service was once dominated by fast

food, fast casual continues to gain market share.

The restaurants themselves are known to have a consistent, simple look, feel and even music

in each location. Customers typically order and pay at a counter or window, and then take

food out or grab a tray to sit and eat. Meals are short, there is no table service and condiments

are usually centrally located rather than table top.

Menus are also the same from location to location, and consumers enjoy a recognizable,

familiar experience no matter where they are, with a dependable level of quality. Meal choices

are inexpensive; with options typically $6 or less with combo meal packages combining

―signature‖ mains with sides and a drink.

The United States fast food market continues to be dominated by hamburger fast food

restaurants, accounting for over 30% of industry sales. However that market share is sliding,

and Mexican food in particular has been gaining.

1.3. INSTANT NOODLE INDUSTRY IN INDIA:

Indian noodle market is estimated at INR 1,300 to 1,600 crores in 2010. According to

estimates, the market is expected to reach INR 3,000-3,500 crore by 2015 clocking a CAGR

of 20%. The market is dominated by instant noodles and Nestle‘s brand – Maggi (which was

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first noodle brand to be introduced in India in mid 1980s). Nestle has virtually dominated the

Indian noodle market till now but lately many large FMCG players and retail chains have

launched their products in this lucrative space.

Urbanization, rising income levels, working couples, interstate migration and changing

lifestyle of young India are key drivers for the noodles market. The product was positioned as

meal which is filling and can be prepared in just a few minutes, thus offering both

convenience and time saving.

1.3.1. Trends in Indian noodle market

 Increasing competition: Competition in instant noodle category has intensified with

players such as GlaxoSmithKline (Horlicks Foodles), ITC (Sunfeast Yippee noodles),

Capital Foods and Hindustan Unilever launching new products in the market. Private

label brands such as Tasty Treat by Future Group (Big Baazar retail chain) have also

been launched an it is expected that many more private label brands may hit the

market.

 New product launches and extensive marketing: All players new or old have been

busy launching new products and marketing campaigns. Maggi has launched an

extensive campaign with their new product vegetable multigrain noodle. Tasty Treat

increased its variants from two to five. Similarly, Foodlles is stressing on the health

aspect of its products.

 Stress on health and wellness: As on all other food categories, players are stressing

on health and wellness aspects of their products. Maggi launched Atta noodles and

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 multigrain noodles to woo customers while Glaxo‘s Foodles also stresses on the

multigrain aspect of their product

 Traditional flavors still dominate: Masala, chicken and tomato are most popular

flavors in the market

 Addressing rural market: Noodles are primarily consumed in urban India and to

expand this market companies such as Nestle have introduced small sized and low

cost products to address the demand of rural market. The success of this effort is still

to be seen.

1.3.2 .Key players in Indian noodle market

The instant noodle market is dominated by MNCs; very few local players have a sizeable

presence. Some of the key players in the market along with their brands are:

 Nestle (Maggi)

 Hindustan Unilever (Knorr Soupy Noodles)

 GlaxoSmithKline Consumer Healthcare (Foodles)

 Capital Foods Ltd. (Ching's Secret)

 ITC (Sunfeast Yippee noodles)

 CG Foods India Pvt. Ltd.(wai wai)

 Future Group (tasty Treat)

1.3.3. Opportunities in Indian noodle market

 Health and wellness theme: Health and wellness theme based packaged food is

gaining popularity in India and the market of such noodles is still open as traditional

player Maggi is not associated with ―health‖ but with convenience and taste.
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  Huge Rural market: rural India where close to 60% of Indian population resides is a

huge consumption market virtually un-penetrated by any player. Low cost products

with appropriate marketing can open up this huge market.

1.4. MAGGI NOODLES IN INDIA:

In the 80s, while noodles were considered as a sort of ‗foreign‘ food, it was Maggie that

revolutionized the trend of eating Noodles in India. Ever since its launch in India in 1983,

this brand has become synonymous with noodles. The bright red and yellow colours of the

packet with the brilliant blue ―2-minute Noodles‖ printed on it made a way to every kid‘s and

mommy‘s heart and soon became a regular item stored in the kitchen shelves of most Indian

households. To capture the market it was positioned as a hygienic home made snack, a smart

move. Over the years, Maggi has grown as a brand and positioned itself as a ―Fast to cook!

Good to Eat!‖ food product.

Figure No. 1.3 – Logo of Maggi

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From being a foreign brand who found it difficult to establish it in the minds of the

consumers to becoming one that eventually occupied their hearts, Maggi pioneered and

became the leader in the Instant Foods Category. Its strategic marketing techniques, in-depth

market analysis, and the ability to maintain strong stakeholder relationships contributed

towards boosting the brand‘s growth.

Further the MAGGI 2-MINUTE Noodles has been renovated to provide 20% of the RDA1 of

Calcium and Protein for the core target group building on the nutrition proposition ―Taste bhi

health bhi‖. The company could have easily positioned the product as a meal, but did not, as

a study had shown that Indian mentality did not accept anything other than rice or roti as

meal. They made it a easy to cook snack that could be prepared in just two minutes. The

formula clicked well and Maggi became a brand name.

However, in 2015, the prosperously growing brand got a major jolt as unhealthy levels of

lead and MSG got detected in sample of its most popular product - the noodles by FSSAI.

Maggi got ripped apart for months, and the Bombay High Court banned its production and

distribution within the country. On June 5, the Food Safety and Standards Authority of India

[FSSAI] termed Maggi as ―unsafe and hazardous‖ for human consumption and ordered

Nestle India to withdraw all nine variants of Maggi Instant Noodles from the market. The ban

of Maggi started with the first phase of inspection in Barabanki, Uttar Pradesh, from where

the food inspector allocated a batch of 12 Maggi Packets to the research lab in Gorakhpur.

After detection of some harmful chemicals, the batch was then transferred to Kolkata, where

the presence of excess lead and MSG (monosodium glutamate) was confirmed. As a result

Maggi has been made to pull off the shelves all over India. Nestle made an effort to relaunch

Maggi noodles and entered the stores during November after the test has been conducted on
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165 millions of packets of noodles and found that levels of lead in the Maggi noodles were

within the food safety limits specified by the Indian authorities and termed Maggi noodles as

safe for consumption.

Nestle India Ltd said Maggi noodles has regained 50% share in India‘s Rs.2,000-crore

noodles market, about six months after it relaunched the popular snack. The company has

based its claim on a report by market researcher Nielsen.

The local arm of the Swiss packaged food company relaunched Maggi noodles on 9

November. Nestle India was not able to sell Maggi noodles for six months in 2015 after the

Food Safety and Standards Authority of India on 5 June imposed a ban after some samples of

the snack were allegedly found to contain excess lead and monosodium glutamate.

―Over the past 33 years, Maggi has become the most trusted and valuable food brand in

India. They have gained month on month and continue to lead the noodles category with over

50% market share,‖ Suresh Narayanan, chairman and managing director, Nestle India, said in

a statement.

Maggi masala noodles were relaunched in November 2015 and the chicken variant in

February. Nestle India is now bringing back the popular variants—Maggi vegetable atta and

Maggi oats noodles.

―We understand the changing lifestyles of generations and have constantly innovated

products that add value to the favourite Maggi Noodles. With the latest relaunch, we are

aiming to provide more choices to suit consumer preferences, driving greater volumes and

building back our market share. We are hopeful that these two variants will also have a rapid

pick-up like the masala and chicken variants,‖ said Narayanan.

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Maggi‘s market share was much higher before the ban , according to a report by Nomura

Financial Advisory and Securities (India) Pvt. Ltd, published in May 2015, Maggi

commanded 80.2% of the market for instant noodles in the quarter to March 2015. During

the period when sale of Maggi noodles was banned, ITC Ltd‘s Yippee noodles and Wai Wai

noodles from Nepal‘s CG Foods gained market share filling the void created by the absence

of Nestle India‘s Maggi from the market. Yoga guru Ramdev‘s Patanjali Ayurveda also

joined the race for a share of the market by launching atta noodles.

The ban hurt Nestle India‘s revenue in three consecutive quarters. ―The company faced an

unusual situation with Maggi Noodles that impacted its operations during the 2nd, 3rd and

4th quarters. The results for the year and for the 4th quarter ended 31 December 2015 are not

fully comparable with the results of the previous corresponding periods,‖ Nestle India said in

the company‘s annual earnings statement.

For the 12 months ended 31 December, Nestle‘s net profit fell 52% to Rs.563.27 crore.

―There‘s still room for growth. The company is launching more variants which will help in

gaining market share. In the longer term, it is likely to cross 60%, but is unlikely to reach the

level where it was before the ban. Competition has picked up really well during the absence

of Maggi noodles in the market,‖ said Abneesh Roy, an analyst with Edelweiss Securities.

1.5. TIMELINE OF MAGGI IN INDIA:

Following is the timeline of Maggi Muddle that happened in India in the latter half of 2015 –

May, 2015

FSSAI regulators found unhealthy levels of MSG and 17 times more than the permitted level

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of lead in samples of Maggi Noodles in Barabanki, a district in Uttar Pradesh, India

3rd June, 2015

Maggi Noodle got banned in New Delhi by the government for 15 days.

Nestlé India created a page on its website, that is still accessible, with the title - ‗MAGGI

Noodles in India: Your Questions Answered‘ answering several questions about the product.

4th June, 2015

The FDA of Gujarat banned Maggi Noodles for 30 days after 27 out of 39 samples showed

objectionably high amounts of lead. Meanwhile the state of Assam put a complete ban on

Maggi Xtra-Delicious Magical Masala Noodles variant for a month‘s period. Future Group‘s

Nilgiris, Easyday, and Big Bazaar, banned the sale of the products too. This was followed by

Maggi being banned in more than 5 states including Tamil Nadu.

5th June, 2015

Generations have grown up loving Maggi‘s signature tastemaker - the masala. A sample of

13 tastemaker sachets was tested by Delhi authorities out of which 10 were found to have

excess lead content. The sample packets collected from Uttar Pradesh had 17.2 ppm of lead.

The food items produced under the banner of Maggi were banned in Andhra Pradesh. FSSAI

called for an official recall of all the nine varieties of Maggi Instant Noodles and Maggi Oats

Masala Noodles all over India. Maggi Noodles was taken off the shelves as a country wide

ban was called in by FSSAI who said that the products were ―unsafe and hazardous for

consumption.

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6th June, 2015

Maggi noodle was banned for an unlimited period of time by the Central Government of

India.

August, 2015

Tests conducted in US labs found no unhealthy levels of lead in the samples of Maggi

Noodles.

13th August, 2015

The Bombay High Court removed the ban from over Maggi Noodles temporarily, and

questioned the tests conducted previously that led to the ban of the product. Such tests,

however, had not been conducted in laboratories accredited to NABL.

October, 2015

A sting operation conducted by the India Today Television team on FSSAI brought to light

how FSSAI passed samples by conducting no tests in exchange of bribes.

19th October, 2015

The ban on Maggi Noodles was officially uplifted by Bombay High Court.

9th November, 2015

The ban was removed from over Maggi Noodles in India and Maggi was re-launched in the

country Amidst Diwali celebrations. The company started its distribution in all the states

except for Nagaland and Tripura.

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30th November, 2015

Maggi Noodles resumed manufacturing in all the five plants in India – Moga in Punjab,

Tahliwal and Pantnagar in Himachal Pradesh, Nanjangud in Karnataka and Bicholim in Goa.

11th December, 2015

FSSAI filed an appeal to the Supreme Court against the upliftment of the ban from over

Maggi Noodles. They argued that the High Court had erred by asking the company to

provide fresh packets of Maggi Noodles instead of asking a third party to do so. It was

concluded by the bench that they would analyse the arguments given by FSSAI on 13th

January 2016.

The Year 2016 onwards

13th January, 2016

After analyzing the arguments given by FSSAI, the Supreme Court bench decided not to

pass any interim order. However, it ordered the government laboratory operating in Mysuru

to conduct fresh tests on Maggi Noodles during the next eight weeks. The next hearing has

been posted for 5th April, 2016.

February, 2016

Maggi Noodles re-launched its second variety of Chicken Flavoured Instant Noodles which

are available for sale on the online retail platform of Snapdeal as well. It has planned to re-

launch some of the other seven varieties of noodles soon.

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1.6. IMPACT OF THE BAN ON MAGGI

Following is an elaboration of how the ban imposed on Maggi Noodles affected the various

stakeholders of Nestlé and Maggi Noodles.

1.6.1. Impact on Profits, Sales, Share Price and Stocks

Soon after the ban on Maggi, Nestlé (India) saw its profits drop to a negative level. At the

end of quarter 2 of the financial year (i.e. 30th June, 2015), Nestlé incurred a net loss

amounting to Rs 64.40 crores as shown in Figure (1.4) below. That was the first time

Nestlé had faced such a lost in a quarter in the last 17 years. Maggi holds 20% of Nestlé‘s

product portfolio.

(Source: indianexpress.com, 2015)

Figure No. 1.4 - Nestlé Incurs a Net Loss of 64.4 Crores in Quarter 2 of 2015
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In the third quarter that ended on 30th September, 2015, Nestlé India‘s profit went down by

60% from what it was a year before. The profit amounted to Rs.124.2 crores only and this

fall in profit was attributed to the fall in sales of Maggi Noodles.

No sooner had the crisis hit Maggi Noodles, the share price of Nestlé India slumped down

to the lowest level of the year i.e. to Rs 5,539.8. In the next two months, when situations for

Maggi Noodles started to improve, the company reached its highest share price of the year,

i.e. Rs 6,831.95 per share on 5th August, 2015. Figure (1.5) and (1.6) shows the changes in

the share price of Nestlé India in 2015.

(Source: dnaindia.com, 2015)

Figure No. 1.5 - Fluctuations in the Share Prices of Nestlé India from 1st Jan to 30th Oct,

2015

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 (Source: dnaindia.com, 2015)

Figure No 1.6 - Fluctuations in the Share Prices of Nestlé India from 5th June to 30th Oct,

2015

The Ministry of Corporate Affairs put a fine of Rs 640 crores on Nestlé India. The suit was

filed by the government before the consumer forum of NCDRC. 284.45 crores and 355.5

crores were charged for basic and punitive damages respectively.

1.6.2. Impact on Stocks

Stocks amounting to Rs. 320 crores of Maggi Noodles were removed from the shelves and

about Rs 20 crores was paid to a cement factory in Chandrapur in Maharashtra to burn them.

1.6.3. Impact on Organizational Structure

The then Managing Director of Nestlé India, Etienne Benet was asked to resign on 24th

July, 2015. Suresh Narayanan in August, 2015 took over as Nestlé India‘s new Managing

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Director. He was later appointed as the Chairman as well after he announced the progressive

results from the third quarter of Nestlé India.

1.6.4. Impact on the Brand Ambassadors

According to FSSAI‘s Sections 52 and 53, people involved in advertisements that are

misleading and the sale of misbranded food should be punished. Sudhir Kumar Ojha, a

lawyer from a district court in Muzaffarpur, who claimed to fall ill after consuming Maggi

Noodles lodged FIRs against Amitabh Bachchan, PrietyZinta and Madhuri Dixit, the Brand

Ambassadors of Maggi Noodles.

1.6.5. Impact on Consumers

Given that from the very beginning Maggi has communicated with its various target audience

groups at a personal level, it came as a shock to the consumers when the brand chose to reply

to their queries in the most mechanical way. With the speculations filling the air, while some

consumers felt that there was a breach of trust, others continued to support the brand.

1.6.6. Impact on Competitors

With the ban on the production and distribution of the market leader in the Instant Noodles

Category in India, Maggi Noodles‘s competitors found much scope to grow, while new

brands also got a chance to enter into the market. ITC‘s Yipee Noodles that had a meagre 10

to 12% share in the market before the country-wide ban not only became famous after

launching its campaigns that promised quality and safety, but its market share increased

to 50% during the ban period.

26
Wai-Wai Noodles, manufactured by Chaudhary Group (CG) that is based in Lalitpur in

Nepal, took to aggressive marketing strategies to increase its brand visibility in the market.

During this time what came up as a surprise was the launch of Patanjali‘s Atta Noodles.

Based on the changing culinary habits of the people and the move towards healthiness,

Patanjali was formulated.

27
 CHAPTER 2 - LITERATURE REVIEW

Nigam Kumar Narander , Jain Saumya and Dr. PurushottamArya3 (2016) in their study

entitled – “PERCEPTION OF MAGGI NOODLES AMONGST DELHI RESIDENTS:

BEFORE AND AFTER CONTROVERSY”

The instant noodles market in India went through an unprecedented crisis with the banning of

the country‘s favourite 2 minute snack: Nestle‘s Maggi in June 2015. The reports of food

regulators confirmed the presence of lead and MSG in excess in Maggi. Maggi enjoys a fan

following like no other branded noodles and with the company claiming the noodles safe for

consumption, there is a need to know whether decades old association with any brand

changes consumers‘ perception after discovery of health risk and has the perception of Maggi

brand changed significantly after the controversy. Also, it is important to know the

perception of Maggi across demographic variables like occupation and family income since

Maggi has traditionally enjoyed greater popularity amongst students and single working

population. The findings show that consumer perception about Maggi has gone from good

(before controversy) to bad (after controversy) across all demographic segments of

population.

Dictum-Biz- Orbit (2016) in their study entitled – “THE IMPACT OF CONTROVERSY

OF ―NESTLE‘S MAGGI‖ ON CONSUMERS AND THE COMPANY”

As consumers, they play a vital role in the health of the economy local, national or

international. The decisions were made concerning our consumption affect the demand.

Maggi is an international brand of seasonings, instant soups and noodles owned by NESTLE

since 1947. The Maggi controversy has shattered many hearts, as found MSG and Lead more

28
than standard limit. This paper shows the impact of controversy on the consumer mind set

and the company itself. Reeling under the Maggi ban, Nestle India had reported 60.1 per cent

decline in standalone net profit at Rs 124.20 crores for the third quarter ended September,

2015, Fall in share prices and panic in the market etc. But after coming back, it was

concluded from the study that Maggi is the most preferred noodle brand among noodle

consumers. 82% people still trust Maggi beside all the adulteration and controversy. The

study showed that beside the entire quarrel faced by Maggi, consumer‘s opinion about their

loved product didn‘t change much. They kept supporting and were eager for its comeback.

Infect only 28% people witnessed variation in their consumption while all this controversy

had no impact over the consumption pattern on rest of the population.

Das Ritika and Booshan Shabista (2016 ) in their study entitled – “A RESEARCH PAPER

ON THE MAGGI MUDDLE CASE AND ITS IMPACT ON THE PSYCHE OF THE

INDIAN CONSUMERS (18 TO 24 YEARS)”

The journey of Maggi in India over the last 33 years has been quite phenomenal. From being

a foreign brand who found it difficult to establish it in the minds of the consumers to

becoming one that eventually occupied their hearts, Maggi pioneered and became the leader

in the Instant Foods Category. Its strategic marketing techniques, in-depth market analysis,

and the ability to maintain strong stakeholder relationships contributed towards boosting the

brand‘s growth. However, in 2015, the prosperously growing brand got a major jolt as

unhealthy levels of lead and MSG got detected in sample of its most popular product - the

noodles by FSSAI. This paper covers the massacre that Maggi went through in 2015. It

studies the effects of the crisis on the psyche of its target audience, specifically falling in the

age group of 18-24 years, and the change in their buying behaviour. Reports say that after re-
29
launch Maggi is leading the Instant Noodles Category, but whether it will be able to capture

back its old market share of atleast75% .

Dr. Mustiary Begum, P.Shareena (2016) in their study entitled ― ―CONSUMERS

PERCEPTION TOWARDS MAGGI INSTANT NOODLES AFTER ITS RE LAUNCH‖

The paper highlighted issues related to Maggi and how consumer have changed their

perception regarding Maggi after post ban. Researchers have taken 93 respondents and have

done analysis with the help of simple analytical tool like graph and tabular form. The study

shows those consumers are ready to buy Maggi after it prelaunch in the market provided that

they include healthy ingredient. However researcher has not mention about the profile of the

respondent like gender, age, and preference which has greater impact on decision making

secondly the area of study is not covered by researcher which contribute towards decision

making of noodle the test and preference differ in different state hence the present study has

tried to cover maximum possible factor which affect behaviour of consumer.

Mr. Mhabde Rahul, Soni Rajeshri (2017) in their study entitled-―ANALYTICAL STUDY

ON CONSUMER BEHAVIOUR TOWARDS ―MAGGI INSTANT NOODLE‖ IN

MUMBAI –A POST BAN SCENARIO‖

This research paper focuses on perception of consumers post ban towards Maggi instant

noodles. Researcher has taken 50 sample size of age group of 15 and above. Research is

conducted in city of Mumbai using convenience sampling method. The study deals with

consumer behaviour towards Maggi in post ban scenario is interlinked with wellness and

health industry as ban was due to hazardous content in the Maggi. Researcher has highlighted

the comparative analysis of Maggi consumption in pre and post ban scenario. Maggi is

30
consider as most preferred instant noodle brand as compare to other brand of instant noodles

The trend of Maggi consumption is not much affected by ban. Maggi has maintained trust

and confidence amongst the consumer even after post ban period due to its quality and test.

At macro level ban has not affected Maggi for consumption. Consumer still buy Maggi as

instant noodle At micro level the frequency of consumption has gone down due to ban.

Consumer are not frequently consume Maggi same as before they were consuming. The

choice of Maggi become once a month in post ban period is more as compare to pre ban

which clearly shows that people‘s consumption frequency has gone down.

Jain, Ayushi (2016) in their study entitled- ―A STUDY ON MAGGI BAN AND

SIMULTANEOUS LAUNCH OF PATANJALI ATTA NOODLES‖

The author has taken comparative study of Maggi and Patanjali aata noodle. The said paper

has highlighted growth of Patanajali noodle due to Maggi ban. The sample size was 100

respondents and restricted to Delhi region. Research shows that consumer has accepted

Maggi whole heartedly after its ban and also stated that Patanjali is most favoured due to its

price..

Pandey Manjari & Prof Puntambekar G.L (2016) ) in their study entitled- –―MAGGI

NOODLES SALES TREND: BEFORE AND AFTER CONTROVERSY‖

This study reveals impact of Maggi on food market. It has been seen that after re-launching

Maggi shares persistently increasing month on month. Again it is climbing ladder of success.

Maggi Noodles has been adopted various strategies for luring consumers such as advertising,

sales promotion schemes, marketing research, influencing and attractive slogans, tailor-made

31
products according to consumers‘ expectations and desires, always emphasized on health and

quality.

However instant noodles have become universal product to be enjoyed by all, irrespective of

age barriers. By passing of time, people have become attuned with this product. There are

immense possibilities of earning huge profit. This distracts the interest of many

manufacturers of product, they want to encasing these opportunities.

Dr. Sivakumar and Ms. Shyamala (2017) in their study entitled – ―BRAND IMAGE OF

MAGGI NOODLES BEFORE AND AFTER RELAUNCH WITH SPECIAL REFERENCE‖

This study focuses on perceptions of Brand Image of Maggi Noodles before and after Re-

Launch with Special Reference to Coimbatore City. In May 2015, food safety regulations

from Barabanki, Utttar Pradesh, India reported the samples of Maggi 2 minutes noodles had

unexpectedly high level of monosodium glutamate as well as up to 17 times the permissible

limit of lead. FSSAI ordered a recall of all nine approved variants of Maggi instant noodles

and oats masala from India. Many states of India banned Maggi after the FSSAI decision.

June, 2015 the central government of India banned nationwide sale of Maggi products. The

nationwide ban was struck down by the Bombay high court. All the samples of the Maggi

have been cleared with led much below permissible limit. Maggi come back to the shelves in

India from November 2015 after the high court order to nestle to manufacture and sell the

newly manufactured products. Data for the study has been collected from the 200 responded

from structured questionnaire and the statistical tool like percentage analysis, chi-square,

ranking analysis and ANOVA was used for analysis.

32
 CHAPTER 3 - METHODOLOGY

3.1. OBJECTIVES OF STUDY –

 Analyze the repositioning of Maggi as a ―Healthy product‖ and the consumers

perseverance towards the same.

 To understand Brand Image, Brand Quality perceived by customers.

 To understand the performance of Maggi after and before its ban.

 To understand the influence of Maggi on consumers mind set after its ban.

3.2. TYPES OF DATA COLLECTION

 Primary data collection

 Secondary data collection

3.2.1. PRIMARY DATA COLLECTION:

Data observed or collected directly from first hand experience is called primary data

collection.

Primary data has been collected from the questionnaire.

Primary Data Collection Sources:

Primary data can be collected in different ways:

1. Observation

2. Surveys

3. Behavioral data

4. Experiments

33
Among these, ‗survey mehtod‘ was selected to collect the primary data 100 user were visited

& collected the required data relevant to this project.

3.2.2. SECONDARY DATA COLLECTION

Published data collected in the past or other parties is called secondary data collection.

It has been collected by forming a proper questionnaire. Questionnaire is a systematic and

structured manner of collecting data for conducting experiment. The nature of the

questionnaire is very inductive and fundamental. It has been kept in a proper framework to

make it clear to the retailers.

Secondary Data Collection Sources:

Information was collected from secondary sources such as customer survey, newspapers,

advertisements, newsletters etc.

Besides these the use of Internet was also made in collecting relevant information. The data

collected from the above mentioned sources has been adequately structured and used at

appropriate places in the report. The information gathered included:

 Reports

 Pamphlets

 Newsletters

 Research Papers

3.3. METHODOLOGY:

 Research Design- A Research Design is the plan of a Research Study. The design of

a study defines the study type. Research design is the framework that has been

created to seek answers to research questions.

34
 This study adopted Descriptive cum Exploratory Research Design. Descriptive

Research Design describes the characteristics about the population or phenomenon

being studied whereas Exploratory Research Design is conducted where problem that

has not been clearly defined and determines the best research design and data

collection method.

 Sampling Unit- A sampling unit is one of the units into which an aggregate is

divided for the purpose of sampling, each unit being regarded as individual and

indivisible when the selection is made. The sampling unit for this study is students

studying in colleges, families, friends, etc.

 Sampling Technique- A sampling technique is the name or other identification of the

specific process by which the entities of the sample have been selected. The sample

may be either unrestricted or restricted. When each sample is drawn individually from

the population at large, then the sample so drawn is known as ‗unrestricted sample‘

whereas all other forms of sampling are concerned under the term ‗restricted

sampling‘. In the present study, the unrestricted sampling was also adopted.

The Sampling Technique adopted in this study is Non-Probability Convenience

Sampling as the procedure of obtaining the people or units that are most conveniently

available.

35
3.4. TOOLS:

Following tools and techniques have to be used for analyzing the data;

 Averages - The law of averages is a layman's term for a belief that

the statistical distribution of outcomes among members of a small sample must reflect

the distribution of outcomes across the population as a whole.

 Mean - The statistical mean refers to the mean or average that is used to derive the

central tendency of the data in question. It is determined by adding all the data points

in a population and then dividing the total by the number of points. The resulting

number is known as the mean or the average.

 Percentages - One of the most frequent ways to represent statistics is by percentage.

Percent simply means "per hundred" and the symbol used to express percentage is %.

One percent (or 1%) is one hundredth of the total or whole and is therefore calculated

by dividing the total or whole number by 100.

 Pie-charts - Pie chart are circular chart divided into sectors illustrating relative

magnitudes or frequencies. As the data‘s will be of various types such as comparing

based on value as well as the relative comparison, hence both the tools are to be use

for the proper analysis of the data‘s.

 Tables – Statistics tables showing the values of the cumulative distribution functions,

probability functions, or probabilitydensity functions of certain common distributions

for different values of their parameters, and used esp to determinewhether or not a par

ticular statistical result exceeds the required significance level.

 Bar Graph - A bar chart or bar graph is a chart or graph that presents grouped data

with rectangular bars with lengths proportional to the values that they represent.
36
 The bars can be plotted vertically or horizontally. A vertical bar chart is sometimes

called a Line graph.

 Cross Tabulation - Cross tabulation is a statistical tool that is used to analyze

categorical data. Categorical data is data or variables that are separated into different

categories that are mutually exclusive from one another.

37
 CHAPTER 4 - DATA ANALYSIS & INTERPRETATION

 Age wise respondents

Age wise respondents

Age group No of Respondents Percentage (%)

10-20 50 50

21-30 40 40

31-40 5 5

41-50 5 5

Table No. 4.1- Respondents age wise

Age group
5% 5%

50% 10–20
21–30
40%
31–40
41–50

Figure No. 4.1 - Pie Chart of respondents based on Age

Interpretation-

From the above data it is concluded that maximum number of respondents(50%) lies in the

age group of 10-20 years followed by 40% of the respondents in age group of 21-30 years

where as 5% respondents belongs to age group of 31-40 years and 5% respondents belongs to

age group of 41-50 years.

38
  Gender analysis of the respondents

GENDER ANALYSIS

Variables No of the respondents Percentage (%)

Male 44 44

Female 56 56

Table No. 4.2 - Respondents Gender wise

Gender Analysis

44%

56% Male
Female

Figure No. 4.2 - Pie Chart of respondents based on Gender

Interpretation-

It is concluded that 56% of respondents are female and 44% of respondents are male.

39
Question1 - Do you purchase "Ready-to-eat" products available in the market?

Do you purchase "Ready-to-eat" products available in the market?

Variables No of respondents Percentage (%)

Yes 85 85

No 15 15

Table No. 4.3 - Respondents based on consumers of ―Ready-to-eat‖ product

Do you purchase "Ready-to-eat" products

available in the market?

15%

Yes
85% No

Figure No.4.3 - Pie Chart of respondents based on consumers of ―Ready-to-eat‖ product

Interpretation-

From the above data it is concluded that 85% of respondents purchase ―Ready-to-eat‖

products and 15% of the respondents disagree that they do not purchase ―Ready-to-eat‖

products.
40
Question2- Which brand comes to your mind when you think of "Ready-to-eat"

noodles?

Which brand comes to your mind when you think of "Ready-to-eat" noodles?

Variables No of respondents Percentage (%)

Maggi 88 88

Top Ramen 8 8

Knorr 11 11

Sunfeast 8 8

Number of respondents = 100

Table No. 4.4 - Respondents based on brand recall for ―Ready-to-eat‖ noodles

Figure No. 4.4 Bar graph of respondents based on brand recall for ―Ready-to-eat‖ noodles

Interpretation-

From the above data it is concluded that Maggi comes to the mind of maximum number 88%

of respondents followed by 11% in Knorr and 8% in Top Ramen and Sunfeast.

41
Question3- Are you a consumer of Maggi?

Are you a consumer of Maggi?

Variables No of respondents Percentage (%)

Yes 83 83

No 17 17

Table No. 4.5 - Responses based on consumers of Maggi

Are you a consumer of Maggi?

17%

Yes
No

83%

Figure No. 4.5- Pie Chart of responses based on consumers of Maggi

Interpretation-

From the above data it is concluded that 83% of the respondents are consumer of Maggi

where as 17% do not consume Maggi.

42
Question4- How you came to know about Maggi?

How you came to know about Maggi?

Variables No of respondents Percentage (%)

Newspaper 10 10

Radio 1 1

Advertisement 56 56

Friends 15 15

Any other 18 18

Table No. 4.6 - Responses based on sources of awareness about Maggi

How you came to know about Maggi?

1%
18% 10%

Newspaper
15%
Radio
Advertisement
56% Friends
Any other

Figure No. 4.6 - Pie Chart of responses based on sources of awareness about Maggi

Interpretation-

From the above data it is concluded that 56% of respondents came to know about Maggi

from Advertisement followed by 18% from the other sources, 15% from friends, 10 from

newspaper and 15 from radio.

43
Question5-Which umbrella brand does Maggi fall into?

Which umbrella brand does Maggi fall into?

Variables No of respondents Percentage (%)

Unilever 2 2

Kraft 1 1

Nestlé 95 95

Britiannia 2 2

Table No. 4.7 - Responses for general awareness about umbrella brand of Maggi

Which umbrella brand does Maggi fall into?

2% 2%1%

Unilever
Kraft
Nestle
Britannia
95%

Figure No. 4.7 - Pie Chart of respondents based on general awareness about umbrella brand

of Maggi

Interpretation–

From the above data it is concluded that 95% of the respondents has the general awareness

about the umbrella brand of Maggi noodles which comes under Nestle and 5% donot know

about it.

44
Question6- Do you consider Maggi as a healthy product?

Do you consider Maggi as a healthy product?

Variables No of respondents Percentage (%)

Yes 29 29

No 71 71

Table No. 4.8 - Respondents who consider Maggi as healthy product

Do you consider Maggi as a healthy product?

29%

Yes
No

71%

Figure No. 4.8 - Pie Chart of respondents who consider Maggi as healthy product

Interpretation–

From the above data it is concluded that 29% of respondents consider Maggi as a healthy

product and 71% do not consider it as healthy product.

45
Question7- How do you perceive Maggi products?

How do you perceive Maggi products?

Variables No of respondents Percentage (%)

Good for health 5 5

Ready to eat 33 33

Junk Food 31 31

Tasty/Fun eating 59 59

Table No. 4.9 - Responses based on consumers‘ perception about Maggi

Figure No. 4.9 - Bar Graph of respondents based on consumers‘ perception about Maggi

Interpretation–

From the above data it is concluded that 59% of respondents perceive Maggi as Tasty/Fun

eating followed by 33% of respondents perceive it as Ready-to-eat product, 31% perceive it

as Junk food and 5% perceive it as Good for health.

46
Question8- Do you know about the Maggi Muddle Case after which Maggi noodle was

banned in India in 2015?

Do you know about the Maggi Muddle Case after which Maggi noodle was
banned in India in 2015?

Variables No of respondents Percentage (%)

Yes 94 94

No 6 6

Table No. 4.10 - Responses for awareness about Maggi Muddle Case

Do you know about the Maggi Muddle Case

after which Maggi noodle was banned in India
in 2015? 6%

Yes
No

94%

Figure No. 4.10 - Pie Chart of respondents based on awareness about Maggi Muddle Case

Interpretation–

From the above data it is concluded that 94% of respondents know about Maggi Muddle

Case and 6% do not know about it.

47
Question9- Do you believe Maggi noodles contained unhealthy levels of Lead and MSG

up until 2015?

Do you believe Maggi noodles contained unhealthy levels of Lead and MSG up
until 2015?

Variables No of respondents Percentage (%)

Yes 31 31

No 27 27

Can‘t say 42 42

Table No. 4.11 - Respondents who believed noodles contained unhealthy levels of Lead and

MSG

Do you believe Maggi noodles contained unhealthy levels

of Lead and MSG up until 2015?

42% 31%
Yes
No
Can't say
27%

Figure No. 4.11 - Pie Chart of respondents who believed noodles contained unhealthy levels

of Lead and MSG

Interpretation-

From the above data it is concluded that 31% of respondents believes that Maggi noodles

contained unhealthy levels of Lead and MSG up until 2015 where as 27% do not bekieve and

42% do not have any opinion about that.

48
Question10- Did you miss Maggi noodles during the ban?

Did you miss Maggi noodles during the ban?

Variables No of respondents Percentage (%)

Yes 75 75

No 25 25

Table No. 4.12 - Respondents who missed Maggi during ban

Did you miss Maggi noodles during the ban?

25%

Yes
No
75%

Figure No. 4.12 - Pie Chart based on respondents who missed Maggi during ban

Interpretation–

From the above data it is concluded that 75% of the respondents missed Maggi during its ban

and 25% didn‘t miss it.

49
Question11- Did you shift to another brand of noodles during the Maggi ban period?

Did you shift to another brand of noodles during the Maggi ban period?

Variables No of respondents Percentage (%)

Yes 27 27

No 40 40

Rarely 33 33

Table No. 4.13 - Number of respondents who shifted to other brand during ban period

Did you shift to another brand of noodles

during the Maggi ban period?

33% 27%

Yes
No

40% Rarely

Figure No. 4.13 - Pie Chart based on number of respondents who shifted to other brand

during ban period

Interpretation–

From the above data it is concluded that 27% of the respondents shift to another brand of

noodles during its ban where as 40% did not shift to the other brands and 33% respondents

temporarily shifted to the other brands.

50
Question12- If yes, which brands of noodles did you shift over to during the ban?

If yes, which brands of noodles did you shift over to during the ban?

Variables No of respondents Percentage (%)

Top Ramen 14 17.7

Knoor 8 10.1

Sunfeast 27 34.2

Others 30 38

Number of respondents = 79

Table No. 4.14 - Respondents who shifted to other brand during ban period

If yes, which brands of noodles did you shift over

to during the ban?

18%
38%
10% Top Ramen
Knorr
Sunfeast
34%
Others

Figure No. 4.14 - Pie Chart on respondents who shifted to other brand during ban period

Interpretation–

From the above data it is concluded that 17.7% of respondents shifted to Tom Ramen, 10.1%

respondents shifted to Knorr, 34.2% respondents shifted to Sunfeast and 38% of respondents

shifted to other brands during ban period.

51
Question13- How much are you satisfied with the brand Maggi after the Maggi Muddle

Case?

How much are you satisfied with the brand Maggi after the Maggi Muddle Case?

Variables No of respondents Percentage (%)

Highly satisfied 26 26

Satisfied 25 25

Neither satisfied nor 37 37

dissatisfied

Dissatisfied 6 6

Highly Dissatisfied 6 6

Table No. 4.15 – Respondents showing their satisfaction with Maggi after its relaunch

How much are you satisfied with the brand Maggi after
the Maggi Muddle Case?

6%
6%
26%
Highly satisfied
Satisfied
37% Neither satisfied nor dissatisfied
25% Dissatisfied
Highly dissatisfied

Figure No. 4.15 - Pie Chart of respondents showing their satisfaction with Maggi after its

relaunch

52
Interpretation–

From the above data it is concluded that 26% of respondents are highly satisfied by Maggi

after it relauch, 25% of respondents are satisfied, 37% of respondents are neither satisfied nor

dissatisfied and 6% of respondents are dissatisfied and highly dissatisfied.

53
Question14- How frequently do you eat Maggi?

How frequently do you eat Maggi?

Variables No of respondents Percentage (%)

Every week 40 40

Every forth night 9 9

Every month 15 15

Occasionally 36 36

Table No. 4.16 - Responses based on frequency of consuming Maggi

How frequently do you eat Maggi?

36% 40% Every week

Every forth night
Every month
15% 9%
Occasionally

Figure No. 4.16 - Pie Chart of responses based on frequency of consuming Maggi

Interpretation–

From the above data it is concluded that 40% of respondents eat Maggi every week followed

by 36% of respondents eat Maggi occasionally, 15% respondents eat Maggi every month and

9% of respondents eat Maggi every forth night.

54
  Cross Tabulation

Do you consider Maggi as a healthy product?

Age group No Yes Total

10-20 39 11 50

21-30 26 14 40

31-40 3 2 5

41-50 3 2 5

Total 71 29 100

Table No. 4.17 – Cross tabulation of Maggi as a healthy product

Percentage row-wise

Age group No (%) Yes (%) Total

10-20 78 22 100

21-30 65 35 100

31-40 60 40 100

41-50 60 40 100

Table No. 4.18 - Cross tabulation row-wise of Maggi as a healthy product

Interpretation:

From the above data we can infer that in the sample size of 50, 78% of the respondents

within the age group of 10-20 years of age, were of the opinion that Maggi is not a healthy

55
product. On the other hand, 22% of the respondents in the age group of 10-20 years of age

believed in Maggi being a healthy product.

Moving on with the sample size of 40, it can be interpreted that 65% of the respondents

within the age group of 21-30 years opinionated that Maggi is an unhealthy product.

However 35% of respondents reflected the contrary i.e., Maggi being a healthy choice of

product.

Next sample size of 5 within the age group of 31-40 years, 60% people considered Maggi to

be an unhealthy product whereas 40% of respondents considered it as healthy product.

The last sample size of 5 within the age group of 41-50 years, 60% people considered Maggi

to be an unhealthy product whereas 40% of respondents considered it as healthy product.

Percentage column-wise

Age group No Yes

10-20 54.92 37.93

21-30 36.61 48.27

31-40 4.22 6.89

41-50 4.22 6.89

Total 100 100

Table No. 4.19 - Cross tabulation column-wise of Maggi as a healthy product

Interpretation:

From the above data we can infer that the majority of the respondents within the age group

of 10-20 years approximately 54% of respondents considered Maggi as unhealthy product

56
and approximately 36% of respondents belonging to the age group of 21-30 years are of the

same opinion. People aged between 31-40 years and 41-50 years had similar percentage of

approximately 5% considered Maggi as unhealthy product.

On the other hand, the minority of the respondents within the age group of 10-20 years,

approximately 38% of the respondents considered Maggi as healthy products and

approximately 48% of the respondents belonging to the age group of 21-30 years are of the

same opinion. People aged between 31-40 years and 41-50 years had similar percentage of

approximately 7% considered Maggi as healthy product.

57
 Did you shift to another brand of noodles during the Maggi ban period?

Age group No Yes Rarely Total

10-20 21 13 16 50

21-30 14 13 13 40

31-40 2 1 2 5

41-50 3 - 2 5

Total 40 27 33 100

Table No. 4.20 - Cross Tabulation of shifting to another noodles brand during its ban

Percentage row-wise

Age group No (%) Yes (%) Rarely (%) Total

10-20 42 26 32 100

21-30 35 32.5 32.5 100

31-40 40 20 40 100

41-50 60 - 40 100

Table No. 4.21 - Cross Tabulation row-wise of shifting to another noodles brand during its
ban

Interpretation:

From the above data we can infer that in the sample size of 50, 42% of the respondents

within the age group of 10-20 years of age, did not shift to the other brands during Maggi ban

period. On the other hand, 26% of the respondents in the age group of 10-20 years of age

58
shifted to the other brands during Maggi ban period and 32% of the respondents for few

months they shifted to the other brands.

Moving on with the sample size of 40, it can be interpreted that 35% of the respondents

within the age group of 21-30 years did not shift to the other brands during Maggi ban

period. However 32.5% of respondents reflected that they shifted to the other brands during

its ban and 32.5% of respondents for few months they shifted to the other brands.

Next sample size of 5 within the age group of 31-40 years, 40% people did not shift to the

other brands during Maggi ban period whereas 20% of the respondents shifted to the other

brands during Maggi ban period and 40% people for few months they shifted to the other

brands.

The last sample size of 5 within the age group of 41-50 years, 60% people did not shift to the

other brands during its ban whereas 40% of respondents fo,mr few months they shifted to the

other brands.

Percentage column-wise

Age group No (%) Yes (%) Rarely (%)

10-20 52.5 48.14 48.48

21-30 35 48.14 39.40

31-40 5 3.7 6.06

41-50 7.5 - 6.06

Total 100 100 100

Table No. 4.22 - Cross Tabulation column-wise of shifting to another noodles brand during
its ban

59
Interpretation:

From the above data we can infer that the majority of the respondents within the age group of

10-20 years approximately 52% of respondents did not shift to the other brands of noodles

during its ban and approximately 35% of respondents belonging to the age group of 21-30

years are of the same opinion. People aged between 31-40 years and 41-50 years had

percentage of approximately 5% and 8 respectively did not shift to the other brands of

noodles during its ban.

On the other hand, the minority of the respondents within the age group of 10-20 years and

21-30years, approximately 48% of the respondents shifted to the other brands of noodles

during its ban and approximately 4% of the respondents belonging to the age group of 31-40

years shifted to the other brands of noodles during its ban.

Moving on, it can be interpreted that the age group of 10-20 years, approximately 49% of

respondents shifted to the other brands of noodles for few months and approximately 39% of

respondents belonging to the age group of 21-30 years are of the same opinion. People aged

between 31-40 years and 41-50 years had percentage of approximately 6% shifted to the

other brands of noodles for few months.

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 CHAPTER 5: FINDINGS AND CONCLUSION

5.1. MAIN FINDINGS:-

 Majority of respondents that is 85% agreed that they purchase ―Ready-to-eat‖

products from the market.

 Maximum number of respondents thinks of Maggi noodles when it comes in their

mind about ―Ready-to-eat‖ products.

 From a large no. of respondents 83% of the respondents are the consumers of Maggi

noodles.

 Maximum number of people that is 56% come to know about the Maggi through the

help of advertisements.

 95% of the respondents has the general awareness about the umbrella brand of

Maggi noodles which comes under Nestle

 Majority number of respondents that is 76% considered the Maggi as a healthy

―Ready-to-eat‖ product.

 Most of the respondents that is 94% have the information regarding the Maggi

muddle case after which the Maggi noodles was banned.

 Maximum number of respondents that is 76% missed the ―Ready-to-eat‖ Maggi

noodles durring its ban.

 Most of the respondents consume ―Ready-to-eat‖ Maggi noodles every week.

5.2. LIMITATIONS:-

 Unwillingness of the people to fill the questionnaire

 The answer of the respondents are sometimes biased.

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  Sample size is relatively small so it might not give the perfect result.

 The project undertaken needs a lot of secondary data so the availability and precision

of this data forms the major limitation as the biasness has to be minimized.

 The results and conclusions of the project cannot be generalized in all area of an

organization.

 There was a shortage of time and resources for the functioning the operation.

5.3.SUGGESTIONS:-

 Health conscious ―Ready-to-eat‖ Maggi noodles should be made so that the people

would be able to consume a healthy product.

 Innovation in the product by adding fresh vegetables in the Maggi noodles can be

done.

 Stock should be distributed to small shops and stores also so that it is easily reachable

for public at large.

 Should focus on its branding and image by involving some celebrity to endorse it as a

brand.

 Maggi Noodles should double check the stock and get approved from experts

before sending the stocks to the market,

 Create an urge in the youth through advertisements and re-creating the old

memories through commercial ads and campaigns,

 Increase in the Marketing Campaigns will pick up the sales and gain the lost

consumers,

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  Conduct Group Discussions in the top institutes of Management in India to

create awareness.

 Nutritional value should be improved like fat content should be reduced and other

minerals should be added in the product.

 Use the package to describe the nutritious benefits.

 Do more market research to improve the product.

5.4.CONCLUSION:-

Nestle will have to work hard to build up the faith among the people that it once used to had

though Nestlé India has conducted over 3,500 tests, representing over 200 million packs, in

both national as well as international accredited laboratories and all reports are clear. In

addition to these, various countries including USA, UK, Singapore, Australia and others

have found Maggi noodles manufactured in India safe for consumption.

In India Nestle were asked by the regulator to recall the product and they stopped selling it.

In fact, before the order was issued, Nestlé India had announced it had stopped selling

MAGGI Noodles. This is because concerns about the product led to confusion for the

consumer to such an extent that Nestlé India felt it was necessary to take the product out of

the market while we engage closely with the regulators and others to discuss the situation.

They further have received test results from all three laboratories mandated by the Bombay

High Court to test MAGGI Noodles samples. All the 90 samples, covering 6 variants, tested

by these laboratories are clear with lead much below the permissible limits.

Winning back the trust of consumers and investors is key to reviving the brand image. The

business performance of the company originates from the consumer performance. Nestle
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certainly recognizes this, and it is evident by the emphasis it led on rebuilding trust and

consumer confidence.

5.5. SCOPE FOR FURTHER STUDY:-

 Large sample size could have make results more prominent and good.

 Respondents in large number may be asked or targeted

 Use of better statistical tool may help to enhance the result of the study.

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