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CONSUMER PREFERENCE AND MARKETING

ON FAST MOVING CONSUMER GOOD (FMCG).
(WITH COMPANY PROFILE NESTLE AND PARLE)

INDEX

SR.NO CONTENT PG.NO

1.0 EXECUTIVE SUMMARY
1.1 OBJECTIVE OF STUDY
1.2 INTRODUCTION
1.3 RESEARCH AND METHODOLOGY
2.0 COMPANY PROFILE
2.1 PARLE:-
INTRODUCTION,HISTORY,OVERVIEW
2.2 -PRODUCTS AND BRAND OF PARLE
2.3 -NEW LAUNCHES OF PARLE
2.4 NESTLE:-INTRODUCTION,HISTORY,OVERVIE
W
2.5 -PRODUCTS AND BRAND OF NESTLE
2.6 NEW LAUNCHES OF NESTLE
3.0 CONCEPTUAL FRAMEWORK
3.1 INTRODUCTION TO FMCG
3.2 HISTORY OF FMCG
3.3 FEATURES OF FMCG
3.4 WHAT ARE THE FUTURE HOLDS OF FMCG
3.5 FMCG PRODUCTS OF NESTLE AND PARLE

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3.6 MARKET STRATEGIES ADOPTED BY NESTLE
AND PARLE
3.7 MARKET SHARE OF NESTLE AND PARLE
3.8 TRENDS IN FMCG PRODUCTS IN INDIA
4.0 COLLECTION AND ANALYSIS OF DATA
5.0 INTERPRETATION OF DATA
6.0 SUGGESSIONS AND RECOMMENDATION
7.0 CONCLUSION
8.0 APPENDIX
9.0 BIBLIOGRAPHY

1.0-EXECUTIVE SUMMARY

The Fast Moving Consumer Goods (FMCG) industry in India is one of the largest
sectors in the country and over the years has been growing at a very steady pace
.The sector consists of consumer non-durable products which broadly consists,
personal care, household care and food & beverages. The Indian FMCG industry is
largely classified as organized and unorganized. This sector is also buoyed by
intense competition. Besides competition, this industry is also marked by a robust
distribution network coupled with increasing influx of MNCs across the entire value
chain.

This sector continues to remain highly fragmented .Examples of FMCG generally

include a wide range of frequently purchased consumer products such as toiletries,
soap, cosmetics, tooth cleaning products, shaving products and detergents, as well as
other non-durables such as glassware, bulbs, batteries, paper products, and plastic
goods. FMCG may also include pharmaceuticals, consumer electronics, packaged
food products, soft drinks, tissue paper, and chocolate bars. ​The current millennium

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has unfolded new business rules most the significant of them being that company
has to constantly look into minds of the customer. Customer loyalty plays significant
role and today securing that loyalty requires quality right price and of course last but
not the least i.e. creating awareness about their service. As a trainee, I was given
knowledge about the way and style of their working, their routine and their
environment. It was a great experience in getting under such a reputed company,
which has in it the ability to retain customer.

In this project we will look after the consumer behavior and preference about FMCG
products. We will look after the consumer preference towards ​NESTLE AND
PARLE COMPANY.

1.1-OBJECTIVE

➢ To study the concept of FMCG products

➢ To have a comparative analysis of Nestle and Parle FMCG products
➢ To identify the services and products offered by NESTLE and PARLE.
➢ To study and analyze the customer perception and preference about NESTLE
& PARLE.
➢ Finally to draw the various conclusion and recommendation on the on the
basis of study conducted.

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 1.2-INTRODUCTION

Products which have a quick turnover, and relatively low cost are known as Fast
Moving Consumer Goods (FMCG). FMCG products are those that get replaced
within a year. Examples of FMCG generallyinclude a wide range of frequently
purchased consumer products such as toiletries, soap, cosmetics, toothcleaning
products, shaving products and detergents, as well as other non-durables such
as glassware, bulbs, batteries, paper products, and plastic goods. FMCG may also
include pharmaceuticals, consumer electronics, packaged food products, soft drinks,
tissue paper, and chocolate bars.A subset of FMCGs are Fast Moving Consumer
Electronics which include innovative electronic productssuch as mobile phones,
MP3 players, digital cameras, GPS Systems and Laptops. These are replacedmore

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frequently than other electronic products.White goods in FMCG refer to household
electronic items such as Refrigerators, T.Vs, Music Systems,etc.In 2005, the
Rs. 48,000-crore FMCG segment was one of the fast growing industries in
India. Accordingto the AC Nielsen India study, the industry grew 5.3% in value
between 2004 and 2005.Indian FMCG Sector The Indian FMCG sector is the fourth
largest in the economy and has a market size of US$13.1 billion.Well-established
distribution networks, as well as intense competition between the organised
andunorganised segments are the characteristics of this sector. FMCG in India has
a strong and competitiveMNC presence across the entire value chain. It has been
predicted that the FMCG market will reach toUS$ 33.4 billion in 2015 from US $
billion 11.6 in 2003. The middle class and the rural segments of theIndian
population are the most promising market for FMCG, and give brand makers the
opportunity toconvert them to branded products. Most of the product categories like
jams, toothpaste, skin care,shampoos, etc, in India, have low per capita consumption
as well as low penetration level, but the potential for growth is huge.The Indian
Economy is surging ahead by leaps and bounds, keeping pace with rapid
urbanization,increased literacy levels, and rising per capita income.The big firms are
growing bigger and small-time companies are catching up as well. According to
thestudy conducted by AC Nielsen, 62 of the top 100 brands are owned by MNCs,
and the balance by Indiancompanies. Fifteen companies own these 62 brands, and
27 of these are owned by Hindustan Lever. Pepsiis at number three followed by
Thums Up. Britannia takes the fifth place, followed by Colgate (6), Nirma(7),
Coca-Cola (8) and Parle (9). These are figures the soft drink and cigarette companies
have alwaysshied away from revealing. Personal care, cigarettes, and soft drinks are
the three biggest categories inFMCG. Between them, they account for 35 of the top
100 brands.

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2.0- COMPANY PROFILE

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2.1- PARLE

INTRODUCTION

Parle Products has been India's largest manufacturer of biscuits and confectionery
for almost 80 years. Makers of the world's largest selling biscuit, Parle-G, and a host
of other very popular brands, the Parle name symbolizes quality, nutrition and great
taste. With a reach spanning even to the remotest villages of India, the company has
definitely come a very long way since its inception.

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Many of the Parle products - biscuits or confectioneries, are market leaders in their
category and have won acclaim at the Monde Selection, since 1971. With a 40%
share of the total biscuit market and a 15% share of the total confectionary market in
India, Parle has grown to become a multi-million dollar company. While to the
consumers it's a beacon of faith and trust, competitors look upon Parle as an
example of marketing brilliance.

Available Anywhere

​Today, the great strength of Parle Products is the extremely widespread distribution
network. Even at the remotest places, you can buy Parle biscuits and sweets from the
local grocer. It has taken years to create this extensive network. Parle’s sales force
started with one salesman in Bombay and some agents in few other cities.
Gradually, Parle Products expanded. Soon sweets and biscuits were being sent by
rail to Calcutta, Delhi, Karachi, Madras and other major cities. As production
increased, distribution was amplified. Full time salesmen were appointed in different
areas. Currently, Parle Products has over 33, 00,000 distribution outlets.

History

Parle Product’s fame and familiarity is undeniable. Considering its extensive reach,
the brand Parle is known and recognized by everyone. Over the years, Parle’s sweets
and biscuits have become a household name. From kids to adults, everyone loves
and cherishes these treats. It gives us great pleasure to see our consumers enjoy and
embrace Parle products on daily basis. Our confectioners and chefs have the utmost
authority at Parle. Had it not been so, the beginning of Parle would have been quite
different.

In 1929 a small company by the name of Parle products emerged in British

dominated India. The goal was to spread joy and cheer to children and adults alike,
all over the country with its sweets and candies. Although, the company knew that it
wouldn’t be an easy task, they decided to take the brave step. A small factory was

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set up in the suburbs of Mumbai to manufacture confectionery products. A decade
later this factory was upgraded to manufacture biscuits as well. Since then, the Parle

name has spread in all directions and has won international fame. Parle has been
sweetening the lives of people all over India and abroad.

Apart from the factories in Mumbai and Bangalore, Parle also has factories in
Bahadurgarh, Haryana and Neemrana, Rajasthan. These are the largest biscuit and
confectionery plants in the country. Additionally, Parle Products also has 10
manufacturing units and 75 manufacturing units on contract.

Milestones - The Decades of Progress

1929:The first year of operation. Our only assets were hard work and hope.

1939:Ten years of determined effort brought results. Things began to take shape.
And we tried even harder.

1949:The formative years were over. We had come of age.

1974:Here was the first evidence of Parle as it is today

QUALITY

Hygiene is the precursor to every process at Parle. From husking the wheat and
melting the sugar to delivering the final products to supermarkets and store shelves
nationwide, care is taken at every step to ensure the best product of long-lasting
freshness. Every batch of biscuits, confectioneries & snacks are thoroughly checked
by expert staff, using the most modern equipment. This ensures consistent and
perfect quality across the nation and abroad.

Concentrating on consumer tastes and preferences, the Parle brand has grown from
strength to strength ever since its inception. The factories at Bahadurgarh, Haryana

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and Neemrana, Rajasthan are the largest biscuit and confectionery plants in the
country. The factory in Mumbai was the first to be set up, followed soon by the one
in Bangalore, Karnataka. Parle also has 10 manufacturing units for biscuits and 75
manufacturing units for confectioneries on contract.

AWARD

We are extremely delighted to announce that we have been Ranked 7th in the Brand
Equity's Most Trusted Brand 2012.

Right since the company's inception, we have always strived to give our consumers
the best value and keep them satisfied through the quality of our products. We have
always worked hard to deliver best results and we are very happy that the consumers
have validated our efforts in giving the best quality of products. Being ranked 7th
amongst the top ten most trusted brands by Economic Times is definitely an honor
and we are grateful to consumers for trusting us with our products and quality and
we shall continue to deliver best value to our consumers.

OVERVIEW

•Parle-G is a brand of biscuits manufactured byParleProducts in India.

•A cream colored yellow stripped wrapper with a cute babyphoto containing 10-12
biscuits with the company’s name printed in Red and you know these are Parle G
biscuits .

•Primarily eaten as a tea-time snack, Parle-G is one of theoldest brand names in

India.

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•The great taste , high nutrition and the international qualitymakes Parle - G a
winner .

2.2- Various biscuits and sweets products from Parle and

its types (India)

Looking for wide number of products from Parle. There are wide ranges of products
from Parle and it is famous worldwide. If you are looking for these wide ranges of
fast moving products, then you have stepped in to the right place, where in you can
get to know many products from Parle. Various products from Parle like Biscuits,
Sweets, and Snacks product details can be known here.

About Parle

Parle Products is the largest manufacturer of biscuits, confectionery and snacks for
over 80 years. The name itself proves that this product has high level of quality,
nutrition and great taste. This product of Biscuits reaches to each and every corner
of remote places, and everyone love to eat them with more happiness and
satisfaction.

Parle Products is an Indian company, which holds larger share in the Indian Biscuit
Market. The company was founded in 1929 called Parle Products Company. Out of

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all other products from Parle, one of its famous brands Parle-G is famous for its
yummy biscuits sold all over the world at a reasonable and affordable price.

The Parle Company was divided into three separate subsidiaries of companies,
which was owned by Chauhan group of families. These three companies were Parle
Products, Parle Agro and Parle Bisleri. The Parle products became very successful
after growth and markets for Gluco Biscuits and Parle-G Biscuits. The products of
Parle Products were mainly consists of Biscuits, Sweets products, and Snacks.

Parle Product list and its brand range

Parle Product focused on bringing more productive products and expanding the
market rapidly. It was founded in 1929. It has a history of over 80 years and its
business has grown tremendously stepping at higher margin and satisfying consumer
needs by giving superior quality of products. Their brand name including the
features, quality, price, design etc. would help them in growth of rapid sales and
keeping regular customer and choosing their product in the market. The products of
Parle Products were mainly consists of Biscuits, Sweets products, and Snacks.

Types of Parle Companies

Parle Products: Mainly consists of Biscuits, Sweet confectionery and Snacks

Parle Agro: Mainly consists of Beverages, packaged drinking water and Food
Confectionary & Snacks

Parle Bisleri: - Mainly consists of bottling water in glass bottles under the name
Bisleri

Now let's have a detailed outlook about various segmentation of this giant brand of
products from Parle.

Parle Products

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The highest and the fast selling product under this company, is Biscuits. It has
largest number of shares and it plays a vital role in Biscuits Industries.

The Parle Products consists of the following:

>Biscuits

>Sweet Confectionery

>Snacks

1)Biscuits

Biscuits are fond of everyone, kids, adult, old or new generation. Parle brings wide
variety of Biscuits which gives consumers to choose wide range of these products
and enjoy the benefits. Out of all the Biscuits, Parle-G, plays a vital role in Biscuit
Industry and has a major share of the Indian Biscuit Market.

Types of Biscuits : Glucose, Parle G, KrackJack, Monaco, Kreams, Hide & Seek,
Hide & Seek Milano, Hide & Seek Bourbon, Parle Actifit Digestive Marie, Parle

Marie, Milk Shakti, Nimkin, 20-20 Cookies, Golden Arcs, Festo, Top, Parle
Coconut Cookies, Parle-G Magix, Hide & Seek Fab, Happy Happy.

The snap shot of each of these biscuits are attached for easy reference. Each of these
biscuits are briefly discussed:

Parle G

Parle G is one of the world's largest selling Biscuits. It is fully filled with loads of
milk and wheat. The Parle products mainly the Parle G has more nutrients and
strengthens millions of people serving them nearly 80 years.

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Parle G is one of the healthy snacks for vast number of people in the world. People
consume them for the value it offers and also due to good taste. The price varies
from Rs 2, Rs 5 to Rs 50.

KrackJack

Parle introduced sweet and salty biscuit which is named as KrackJack. This is
preferred by many kids, adults for its great taste of this product. This biscuit is
crispy and delicious with equal amount of sweet and salt in it. Once you start eating
KrackJack, you will surely end up eating the whole packet within no time. This
product is consumed generally during evening tea or snack in the morning. This is

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mainly preferred by kids who have no time to have breakfast in the morning, instead
carry two packets of this product to school. The price varies from Rs 5 to Rs 20.

Monaco

Parle introduced yet another brand which is referred as a salty biscuit which is
named as Monaco. This is preferred by many kids, adults for its great taste of this
product. This biscuit is light, crispy and delicious with equal amount salt in it. This
Biscuit is referred as "Namkeen Biscuits", Namkeen in Hindi referred as salt in
English. Some of the Monaco Biscuits are Monaco Regular, Monaco 4 in 1, Monaco
Jeera, Monaco Methi and Onion. The price varies from Rs 5 to Rs 20.

Kreams

Parle introduced biscuit's that fulfill every occasions and everybody's choice. This is
named as Kreams. This is preferred by many kids, adults for its great taste of this
product. This biscuits comes in different shapes, sizes and flavours. The flavours

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and price of Kream Biscuits are as follows: Kreams Chocolate – Rs 2, Rs 5 and Rs
10. Kreams Orange, Pineapple, Elaichi and Mango costs Rs 5 to Rs 10. Kreams
Bourbon costs Rs 10 to Rs 18 .

Hide & Seek

Parle introduced biscuit's that fulfills kid's happiness and mouth-watering delight
having the quality and taste which is termed as chocolate chip biscuits which is
called as Hide & Seek. Packed with a plenty of chocolate chips, once you start
eating Hide & Seek you will end up eating the whole packet within no time. The
price varies from Rs 5 to Rs 20, and upto Rs 50.

Hide & Seek Milano

Parle introduced biscuit's that fulfills everybody's happiness and mouth-watering

delight having the quality and taste which is termed as "cookies" which is called as

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Hide & Seek Milano. These cookies are available in Chocolate Chip, Butterscotch,
Butter Nut and Choconut. These cookies are very colourful, and delicious to eat. The
price varies from Rs 15 to Rs 30.

Hide & Seek Bourbon

This is chocolate cream biscuit which is rich and delicious. Such kind of biscuits is
sugar coated ones and everyone fall in love at the first bite. The price varies from Rs
5, Rs 12 and Rs 25.

Parle Actifit Digestive Marie

These biscuits are more with fibre in it and are very healthy for consumption and it
has less fat contained. The price varies from Rs 5 to Rs 15.

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Parle Marie

These biscuits are more crispy and lighter to eat. Once you start eating Marie
Biscuit, you will surely end up eating the whole packet within no time. This product
is consumed generally during evening tea or snack in the morning. The price varies
from Rs 5 to Rs 22.

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Milk Shakti

This is the India's first milk biscuit with honey in it. This biscuit contains more milk
and honey. Many kids love to consume them as this gives more energy and strength.
These biscuits can be part of any body's breakfast, an evening snack. The price
varies from Rs 5 to Rs 10.

Namkeen

Parle introduced biscuit's that fulfills everybody's choice and taste which is termed
as "crackers" which is called as Nimkin. These crackers are crispy, and salty. This is
consumed during tea time or evening snack or during any time of the day. The price
varies from Rs 5 to Rs 10.

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Khatta Meetha

Parle introduced biscuit’s that fulfills everybody’s choice and taste which is termed
as “crackers” which is called as Khatta Meetha. These crackers are crispy, and salty.
This is consumed during tea time or evening snack or during any time of the day.
The price varies from Rs 5 to Rs 10.

20-20 Cookies

These are kinds of cookies which are introduced by Parle, which brings
mouthwatering taste of fresh butter and cashew on each of the cookies. These
biscuits are baked to a golden brown in colour and end of a great taste to consume.

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This is consumed during tea evening snack or during any time of the day. The price
varies from Rs 5 to Rs 10 and Rs 18 for Butter Cookies and Rs 5, Rs 10 and Rs 20 to
Cashew Cookies.

Golden Arcs

These are filled with real fruit. Each roll is filled with jelly which is in orange and
pineapple flovour. These are chewable cake rolls and often taken by kids at student
to eat them during the break time and indulge in something sweet to eat. The price
varies from Rs 10 to Rs 20.

Festo

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This is a cream biscuit which is delicious to eat. Everyone feels the cream within the
biscuits. Many flavour such as Orange, creamy choco, elaichi, pineapple, and mango
is sold in huge quantity and cheaper price. Such kind of biscuits is so sweet and
everyone fall in love at the first bite. The price varies from Rs 5, to Rs 10.

Top

These are crackers filled with finest taste of butter in it. One who consume this will
find himself with Buttery Taste and Dreams. The price varies from Rs 5, to Rs 20.

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Happy Happy

This is yet another type of Parle Happy Happy Cookies. These cookies are baked
with delicious choco-chips to give everyone the taste of choco and gives joy while
eating them. The price varies from Rs 5, to Rs 10.

Magix

This biscuit consists of rich cocoa and crunchy cashews. This is one of the good
health biscuit. This kind of biscuits is a mixture of taste and health. This is field with
7 vital vitamins and 2 minerals. Every kid needs to have this as to gain more energy
and strength. The price varies from Rs 6, to Rs 10.

Coconut Cookies

This kind of cookies is filled with coconut. With each bite the rich taste of coconut
will delight you more. Once you start eating Coconut Cookies, you will surely end
up eating the whole packet within no time. The price varies from Rs 8, to Rs 10.

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Hide & Seek Fab

Parle introduced biscuit's that fulfills everybody's happiness and mouth-watering

delight having the quality and taste which is termed as "Choco filled cookies" which
is called as Hide & Seek Fab. These cookies are available in Chocolate, Strawberry,
Vanila and Orange. These cookies are very colourful, and delicious to eat. The price
varies from Rs 20 to Rs 22.

2)Sweet Confectionery

Sweet are fond of everyone, kids, adult, old or new generation. Parle brings wide
variety of sweet confectionery which gives consumers to choose wide range of these
products and enjoy the benefits.

Types of sweets confectionery: Londonderry, Melody, Mango Bite, Chox, Kaccha

Mango Bite, Poppins and Other Sweets.

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Londonderry

These are one of the best candy made from Milk and Caramel and are very tasty.
The price of this is just 0.50paise.

Melody

These are filled with chocolate. Parle Melody comes with a layer of caramel on
outside and chocolate filled in. Once you eat them, you will never stop asking it
once more. These are very delicious to eat. The price of this chocolate is Rs 1.

Mango Bite

This is one of the first mango candy which is real in taste, with sweet mangoes in it.
You can eat them anywhere and you will surely enjoy the awesome product. Thanks

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to Parle for introducing this product which is filled with real mango, and the price is
very cheap. Each candy costs Rs 0.50 paise.

Chox

This is similar to chocolate bar. The chocolate flavour makes your mouth sweeter.
The price of this chocolate bar is Rs 2.

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Kaccha Mango Bite

This is filled with natural sweetness of a raw mango and everyone loves to eat them
anytime during the day or with friends. The price of this Bite is Rs 0.50 paise.

Poppins

These are sweet candies which are introduced by Parle. These candies are colourful
and sweet to taste. The price varies from Rs 2 to Rs 5

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GolGappa

These are candies which are introduced by Parle. These candies are colourful and
good to taste. The price varies from Rs 2 to Rs 5

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Clovemint

These are filled with clove mint. It is preferred by adults during afternoon or after
heavy meal to get mint freshness in the mouth.

2 in 1Eclairs

These are filled in with creamy, delicious cream and caramel. It's 2 in 1Eclairs, a
sweet delight and preferred by kids, adults, and everyone loves to eat them anytime
during the day or with friends. The price of this is Rs 0.50 paise.

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Kismi Toffee Bar

This is a bar of chocolate. It has flavour of elaichi (cardamom) and this toffee will
give you sweetness throughout the day. The price of this is Rs 0.25 paise.

Kismi Gold

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It has flavour of Caremel & Elaichi and this toffee will give you sweetness
throughout the day. The price of this is Rs 0.50 paise.

3)​Snacks

Snacks are fond of everyone, kids, adult, old or new generation and are consumed
anytime during day. Parle brings wide variety of snacks products which gives
consumers to choose wide range of these products and enjoy the benefits.

Types of snacks: Monaco Smart chips, Parle's wafers, Fulltoss and Munchies.

Monaco Smart Chips

These chips are baked and not fried, and the taste if awesome. It's a healthier and
smarter which will be a great substitute other fried snacks and chips. It has no
calories.

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There are many types of Monaco Smart Chips comprising Tangy-Tomoto, Crazy
Chaat, Macho-Masala. Price varies from Rs 5 – Rs 10

Parle's Wafers

These wafers are made with potatoes and are delicious to taste, crunchy and come
with four awesome flavours which are Tangy Tomato, Cream and Onion, Classic
Salted and Masala Masti. Prices varies from Rs 5 – Rs 20.

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Fulltoss

This snack is very spicy and comes with three awesome hot and spicy flavours
which are Green Mango Chutney, Masala Munch, and Jhalmuri Kolkata Bhel. Prices
varies from Rs 5 – Rs 20

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Munchies

This snack is very good in taste. Types of Parle Munchies are Jeffs and Sixer. Jeff
Munchies are very crunchy and salted biscuits which are good flavoured with cumin
seed in it. Sixer Munchies are also crunchy and salty in taste and once you start
eating them, you will surely end up eating more and more within no time.

Parle Agro

It is an Indian company that owns many brands which is outlined below.

The Parle Agro consists of the following three major businesses:

-Beverages – fruit drinks, nectars, juice, sparkling drinks

-Water – packaged drinking water

-Foods – confectionery, snacks

Beverages

The following are some of the remarkable beverages of Parle Agro products in
India:

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Citra

It is a clear lemon and lime flavoured soda sold in India and it is great in taste.

Frooti

These were sold in tetra pack and one of the largest mango drink in the country.

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Appy

This was a great drink which has flavour of apple and leaf graphic. It comes in tetra
pack and it is one of the first apple nectar introduced by Parle Agro in India.

Appy Fizz

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This is India's first sparkling apple drink available in shaped pet bottles.

LMN

This was launched in year 2009 and was called as non-carbonated lemon drink
which is generally termed as lemonade or nimbu paani.

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Grappo Fizz

This is a sparkling grape juice drink.

Saint Juice

It was launched in year 2008 and are available in three variants – Orange, Mixed
fruit, Grape and Apple.

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Water – packaged drinking water

Bisleri

This is one of the biggest packaged drinking water in India and was launched by
Parle Agro.

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Bailley

Parle Agro has also launched Bailley as one of the best packaged drinking water in
India.

2.3- Launches of parle company product- bisleri

1969:​ Buys Bisleri bottled water from an Italian company, Felice Bisleri. It was
bottled in glass bottles then.

Early-1980s:​ Shifts to PVC bottles. Sales surge

Mid-1980s:​ Switches to PET bottles, which meant more transparency and life for
water.

1993:​ Sells carbonated drink brands like Thums Up, Gold Spot and Limca to
Coca-Cola for Rs 400 crore.

1995:​ Bisleri launches a 500 ml bottle and sales shoot up by 400 per cent.

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2000:​ Introduces the 20-litre container to bring prices down from Rs 10 a litre to Rs
2 a litre.

1998:​ Introduces a tamper-proof and tamper-evident seal.

2000:​ BIS cancels Bisleri's licence of a water bottling in Delhi since some of the
bottles did not carry ISI label; the licence is restored one-and-a-half months later.

2002:​ Kinley overtakes Bisleri. The national retail stores audit by ORG-MARG
show Kinley's marketshare at 35.1 per cent compared to Bisleri's 34.4 per cent.

2003:​ Bisleri says it plans to venture out into Europe and America to sell bottled
water

2.4- Nestle

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INTRODUCTION

Nestle India Ltd., is a part of the Nestle SA group, which is one of the largest
manufacturing companies in the world. The company (with its headquarters in
Vevey,Switzerland) was founded by Henri Nestle in 1867.Nestle has two major
divisions-Le Societe des Products which looks after the production and marketing
andNesstec Ltd. which provides the technical assistance tithe group companies.
Since its inception in 1867, the company has diversified it product range from the

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infant weaning formula (which was its first product) to beverages, confectionery, ice
creams and pet foods among others. In a span of 130 years the company has ranked
26th among the world's largest corporations and boasts of a turnover of $48932.5
million and an employee strength of 221,144 people spread over 75countries
worldwide (Annexure A).Nestle has long been viewed as one of the most
multinational of the multinationals. This is because today only 2% of its turnover
comes from Switzerland. Out of the remaining 98%, Europe contributes
43.5%,North and South America contribute 36.5% and 18% is contributed by Africa
and Asia Pacific Regions.

OVERVIEW

Although Nestle has been associated with India since the beginning of the century
through the importing and trading of infant food and condensed milk, manufacturing
in India only began with the setting up of the factory in Moga in 1962. The first
product to be manufactured was Milkmaid. In the last 35 years the company has
shown rapid progress and has increased its product range to 80 products as of
October 1997. Nestle India Ltd. now rank 22nd amongst India's most valuable
companies (Annexure B). Its gross revenue has increased from Rest. 1001.1 cores to
Rest. 1213.8 cores in1996. This remarkable growth has been achieved through:

•Rapidly creating greater manufacturing capacity, both at factories as well as with

cockers.

•Taking measures to ensure availability and improved quality of key raw

materials-fresh milk in particular.

•Strengthening of the sales and distribution network(particularly in smaller towns).

•Ambitious and cohesive manpower training and development programs for the
personnel of the company across all disciplines. The company's exports also resulted
in a very successful year in this area as exports grew by 27% torso. 250.8 cores in
1996. The main contributors to this increase were the export of tea and coffee to

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USA,Japan, Russia, Hungary and Taiwan. Nestle India Ltd. wants to further increase
its operations in India and has started construction of its sixth Factory at Bicholim,
Goa for the manufacture of culinary products (a key thrust area) for this purpose.

Company Profile

Although Nestle has been associated with India since the beginning of the century
through the importing and trading of infant food and condensed milk, manufacturing
in India only began with the setting up of the factory in Mega in 1962. The first
product to be manufactured was Milkmaid. In the last 35 years the company has
show rapid progress and has increased its product range to 80products as of October
1997. Nestle India Ltd. now ranks 22ndamongst India’s most valuable companies
(Annexure B) . Its gross revenue has increased from Rest 1001.1 cores to Rest.
1213.8 cores in1996. This remarkable growth has been achieved through -

•Rapidly creating greater manufacturing capacity, both at factories as well as with

co-packers.

•Taking measures to ensure availability and improved quality of key raw materials -
fresh milk in particular.

•Strengthening of the sales and distribution network (particularly in smaller towns)

•Ambitious and cohesive manpower training and development programs for the
personnel of the company across all disciplines.

The company’s exports also resulted in a very successful year in this area as exports
grew by 27% to Rest. 250.8 cores in 2003.

The main contributors to this increase were the export of tea and coffee toucan,
Japan, Russia, Hungary and Taiwan. Nestle India Ltd. wants to further increase its
operations in India and has started construction of its sixth Factory at Bicholim, Goa
for the manufacture of culinary products (a key thrust area) for this purpose.

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The Spirit of Nestle

“Organizational excellence is never achieved through a one time effort; It is always

a process of continuous improvement across number of areas of operation.”

A key factor for Nestlé’s success has been its quest for continuous improvement
through ushering in greater productivity and more efficiency in everyday operations.
Despite the infrastructure impediments in India, Nestle has set itself high standards
of business performance. This is reflected through the essence of the company - its
mission statement.

Nestlé’s mission

“To be in every way the leading company in the Indian food industry and a good
corporate citizen by providing our consumers with superior quality products, our
shareholders with rapid growth & fair returns and our employees with a challenging
and satisfying work environment. “To translate this spirit into a planned and
measurable process, Nestle has set up key objectives across all divisions.

Key Objectives

Production

•To optimize production costs while enhancing product quality so as to make Nestle
products even more competitive in the marketplace.

Sales and marketing

•To reach a sales turnover of 3000 cores by the year 2003

•To double the turnover every three years

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People

•To help employees to retain a long term perspective and integrate them fully with
the company’s business goals

•To retain a broad perspective while addressing individual needs

•To view growth as a continuous process

•To concentrate on attitudinal changes by developing leadership skills, an

appreciation of interdependence between units and the enhancement of a sense of
belonging to Nestle.

Finance

•To maintain profit levels above the average for the food industry in India. The
Business Excellence and Common Application (BECA) initiative essentially
translates the spirit of the Journey towards excellence into an organized, systematic
and measurable approach. The aim is to aid the achievements of the company’s key
objectives of rapid growth by ensuring that all operations incorporate the spirit of
meaningful planning, effective cost control and efficient implementation. BECA is
about“ planned improvement in everything we do ”

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2.5- NESTLE PRODUCTS

Quality and nutritional value are the essential ingredients in all of the nestle’s
brands.Millions of people prefer Nestlé products every day, happy with the addition
to their wellness that they bring. If you are looking for a specific brand our product,
just use thealphabetical index below to jump straight to a listing. Or you can explore
by category.

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1.1 Baby Foods

Milk based products and baby food contributes to 43% of Nestle's turnover. For
ensuringregular procurement of good quality milk, Nestle has developed a network

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around itsMoga factory for collection of fresh milk everyday from the farmers.
Nestle has adominating 87% market share in the baby weaning foods with its Cereal
and Nestum brands. Infant milk powder is sold under the Lactogenic and Nestogen
brands. Brandloyalties are very high in categories such as infant food and weaning
cereals, enabling thecompany to command a price premium Other milk products
include dairy whiteners(21% market share) sold under the EveryDay and Tea Mate
brands, sweetened condensedmilk and ready to cook mixes for traditional Indian
sweets sold under the Milkmaid brand.

The company also markets ghee (6% market share) under the EveryDay brand.
Nestle has expanded its milk product portfolio with the launch of new dairy
productssuch as UHT milk, Curd and Butter. Huge investments are being made in
building adiversified dairy business and the distribution infrastructure for the same.
Milk productssales registered a 10.6% yoy growth .The production of infant food
goes right back to the origins of the Nestlé Company.Henri Nestlé's 'Farine Lactée'

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was the first product to bear the Nestlé name.In 1867 a physician persuaded Henri
Nestlé to give his product to an infant who was veryill — he had been born
prematurely and was refusing his mother's milk and all other types of nourishment.
Nestlé's new food worked, and the boy survived. From the very beginning, Nestlé's
product was never intended as a competitor for mother's milk. In 1869, he wrote:
"During the first months, the mother's milk will always be the mostnatural nutrient,
and every mother able to do so should herself suckle her children."The factors that
made baby foods success in the early days of the Nestlé company — quality and
superior nutritional value — are still as valid today for the wide range of infant
formula, cereals and baby food made by Nestlé.

The World Health Organization(WHO) recognizes that there is a legitimate

market for infant formula, when a mother cannot or chooses not to breast feed her
child. Nestlé markets infant formula according tothe principles and aims of the
WHO International Code of Marketing Breast Milk Substitutes, and seeks dialogue
and cooperation with the international health communityand in particular with the
WHO and UNICEF, to identify problems and their solution. Nestlé's expertise as the
world's leading infant food manufacturer, gained over more than125 years, is put at
the disposal of health authorities, the medical profession and mothersand children
everywhere.

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1.2 Chocolate & Confectionery

Nestle forayed into chocolates & confectionery in 1990 and has cornered a fourth
shareof the chocolate market in the country. The category contributes 14% to Nestle
sturnover. It has expanded its products range to all segments of the market The
Kitkat brand is the largest selling chocolate brand in the world. Other brands
include Milky Bar,Marbles, Crunch, Nestle Rich Dark, Bar-One, Munch etc. The
sugar confectionery portfolio consists of Polo, Soothers, Frootosand Milkybar
Eclairs. All sugar confectionery products are sold under the umbrella brand Allen's.
Nestle has also marketssome of its imported brands like Quality Street, Lions and
After Eight . New launchessuch as Nestle Choco Stick and Milky Bar Choo at
attractive price points to woo newconsumers. Chocolate confectionery sales

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registered a strong 21.5% yoy growth in 2001aided by good volume growth in
Munch, Kitkat and Classic sales. Nestle relaunched Bar-One during the year. The
story of chocolate began in the New World with the Mayans,who drank a dark brew
called cacahuaquchtl. Later, the Aztecs consumed chacahoua andused the cocoa
bean for currency. In 1523, they offered cocoa beans to Cortez, whointroduced
chocolate to the Old World, where it swiftly became a favorite food among the rich
and noble of Europe. Nestle forayed into chocolates & confectionery in 1990 andhas
cornered a fourth share of the chocolate market in the country.. It has expanded its
products range to all segments of the market The Kitkat brand is the largest
sellingchocolate brand in the world.

Other brands include Milky Bar, Marbles, Crunch, Nestle Rich Dark,
Bar-One,Munch etc. The sugar confectionery portfolio consists of Polo,Soothers,
Frootos and Milkybar Eclairs. All sugar confectionery products are sold under the
umbrella brand Allen's. Nestle has also markets some of its imported brands like
Quality Street, Lions and After Eight . New launches such as Nestle Choco Stick
and Milky Bar Choo at attractive price points to woo new consumers.
Chocolateconfectionery sales registered a strong 21.5% yoy growth in 2001 aided by
good volumegrowth in Munch, Kitkat and Classic sales.

Nestle relaunched Bar-One during the year.From the beginning, turning raw,
bitter cocoa beans into what one 17th century writer called "the only true food of the
gods" has been a fine art, a delicate mixture of alchemyand science.

1.3 Ice Cream

There are many myths and stories as to the invention of ice cream: was it Marco
Polowho brought it back from China (along with pasta)?

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Probably not, considering the mostlikely never visited China.The story of its
popularity is however connected with the invention of technology tomake it on an
industrial scale, and to keep it cold once made.

Before refrigerationtechniques, food was frozen with the aid of ice, mixed with salt,
which was either storedin ice houses or shipped from cold countries.

But then at the end of the 19th century, both making and freezing it became easier,
and together with the invention of the ice creamcone, made the product boom.

Today, the United States is the absolute leader in terms of volume consumed, but
thehighest per head consumers are in New Zealand. Flavours you'd never have
thought of and yet they're commercially available:

•Sorbets - Smoked Salmon, Tomato, Cucumber

•Ice Creams - Garlic, Avocado, Sweet corn.The ice cream cone is the most
environmentally friendly form of packaging. A Syrianfrom Damascus, Ernest E
Hamwi is credited with its invention. Apparently, during the1904 St Louis World's
Fair, his waffle booth was next to an ice cream vendor who ranshort of dishes.
Hamwi rolled a waffle to contain ice cream and the cone was born.

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1.4 Prepared Foods

Convenience foods — packaged soups, frozen meals, prepared sauces and flavorings
— date back more than a century. With the Industrial Revolution came factory jobs
for women and less time to prepare meals.The problem was so widespread that it
became the object of intense study in 1882 by theSwiss Public Welfare Society,
which offered a series of recommendations, including anincrease in the consumption
of vegetables.

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The Society commissioned Julius Maggi, a miller with a reputation as an inventive
andcapable businessman, to create a vegetable food product that would be quick to
prepareand easy to digest. The results — two instant pea soups and an instant bean
soup — helped launch one of the best known brands in the history of the food
industry. By theturn of the century, Maggi & Company was producing not only
powdered soups, but bouillon cubes, sauces and flavorings.Maggi merged with
Nestlé in 1947. Buitoni, the authentic Italian brand, which has been producing pasta
and sauces in Italy since 1827, became part of the Nestlé Group in 1988.

1.5 Beverages

Beverages like coffee, tea and health drinks contribute to about 30% of Nestle s
turnover.Beverage sales registered a 15% yoy growth . While about 14% of sales
come fromBeverages domestic market, exports contribute to about 16% of sales.
Nestle's Nescafe dominates the premium instant coffee segment. Nestle s other
coffee brand Sunrise hasalso been relaunched under the Nescafe franchise to
leverage on the existing equity of the brand. Nestle has focused on expanding the
domestic market through price cuts and product repositioning. However it has been
losing share in the domestic market, where ithas a 37% market share.

Milo , a brown-malted beverage was launched in 1996. It has anestimated volume

share of about 3% in the malted food drink segment. Nestle haslaunched
noncarbonated cold beverages such as Nestea Iced Tea and Nescafe Frappe during
2001. Nestle is one of the larges coffee exporter in the country. Key export marketis
Russia, besides Hungary, Poland and Taiwan.

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2.6-Timelines for launches OF NESTLE COMPANY

1866 Foundation of Anglo-Swiss Condensed Milk Co.

1867 Henry Nestlé's Infant cereal developed
1905 Nestlé and Anglo Swiss Condensed Milk Co. (new name after
merger)
1929 Merger with Peter, Cailler, Kohler Chocolates Suisses S.A.
1934 Launch of Milo
1938 Launch of Nescafé
1947 Nestlé Alimentana S.A. (new name after merger with Maggi)
1948 Launch of Nestea and Nesquik
1969 Vittel (initially equity interest only)

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1971 Merger with Ursina-Franck
1973 Stouffer (with Lean Cuisine)
1974 L'Oréal (associate)
1977 Nestlé S.A. (new company name) Alcon (2002: partial IPO; 2008:
partial sale)
1981 Galderma (joint venture with L'Oréal)
1985 Carnation (with Coffee-mate and Friskies)
1986 Creation of Nestlé Nespresso S.A.
1988 Buitoni-Perugina, Rowntree (with KitKat )
1990 Cereal Partners Worldwide (joint venture with General Mills)
1991 Beverage Partners Worldwide (joint venture with Coca-Cola)
1992 Perrier (with Poland Spring )
1993 Creation of Nestlé Sources Internationals (2002: Nestlé Waters)
1997 Creation of Nutrition Strategic Business Division (2006: Nestlé
Nutrition)
1998 San Pellegrino and Spillers Petfoods Launch of Nestlé Pure Life
2000 Power bar
2001 Ralston purina
2002 Schöller and Chef America Dairy Partners Americas (joint venture
with Fonterra) Laboratoires innéov (joint venture with L'Oréal)
2003 Mövenpick and Dreyer's
2005 Wagner, Protéika and Musashi
2006 Creation of FoodServices Strategic Business Division (2009:
NestléProfessional) Lactalis Nestlé Produits Frais (associate) Jenny
Craig, Uncle Tobys and Delta Ice Cream
2007 Novartis Medical Nutrition, Gerber and Henniez
2009 Vitality Beverage business
2010 Kraft Pizza

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3.0-CONCEPTUAL FRAMEWORK

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3.1- INTRODUCTION TO FMCG ​(FAST MOVING
CONSUMER GOODS)

What are Fast Moving Consumer Goods (FMCG)?

We regularly talk about things like butter, potatochips, toothpastes, razors,

household care products, packaged food and beverages, etc. But do we know under
which category these things come? They are called FMCGs. FMCG is an acronym
for Fast Moving Consumer Goods, which refer to things that we buy from local
supermarkets on daily basis, the things that have high turnover and are relatively
cheaper. FMCG’s constitute large part of consumers’ budget in all countries. The
retail sector for FMCG’s in India is in the process of a drastic transformation. The
transformation of the retail market is likely to have a long-lasting impact on

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wholesale trade and the distribution of FMCG’s as well. Traditional wholesalers are
the most likely losers, because large retailers tend to buy directly from suppliers.
The Indian FMCG sector is the fourth largest sector in the economy, with a total
market size in excess of US$ 13.1 billion. It has a strong MNC presence and is
characterized by a well-established distribution network, intense competition
between the organized and unorganized segments and low operational cost.
Availability of key raw materials, cheaper labor costs and presence across the entire
value chain gives India a competitive advantage.

FMCG are products that have a quick shelf turnover, at relatively low cost and don't
require a lot of thought, time and financial investment to purchase. The margin of
profit on every individual FMCG product is less. However the huge number of
goods sold is what makes the difference. Hence profit in FMCGgoods always
translates to number of goods sold. Fast Moving Consumer Goods is a classification
that refers toe wide range of frequently purchased consumer products including:
toiletries, soaps, cosmetics, teeth cleaning products, shaving products, detergents,
and other non-durables such as glassware, bulbs, batteries, paper products and
plastic goods, such as buckets. ‘Fast Moving’ is in opposition to consumer durables
such as kitchen appliances that are generally replaced less than once a year. The
category may include pharmaceuticals, consumer electronics and packaged food
products and drinks, although these are often categorized separately. The term
Consumer Packaged Goods (CPG) is used interchangeably with Fast Moving
Consumer Goods (FMCG). Three of the largest and best known examples of
Fast-moving Consumer Goods companies are Nestlé, Unilever and Procter &
Gamble. Examples of FMCGs are soft drinks, tissue paper, and chocolate bars.
Examples of FMCG brands are Coca-Cola, Kleenex, Pepsi and Believe. The FMCG
sector represents consumer goods required for daily or frequent use. The main
segments of this sector are personal care(oral care, hair care, soaps, cosmetics, and
toiletries), household care (fabric wash and household cleaners), branded and
packaged food, beverages (health beverages, soft drinks, staples, cereals, dairy

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products, chocolates, bakery products) and tobacco. The Indian FMCG sector is an
important contributor to the country’s GDP. It is the fourth largest sector in the
economy and is responsible for 5% of the total factory employment in India. The
industry also creates employment for 3 m people in downstream activities, much of
which is disbursed in small towns and rural India. This industry has witnessed strong
growth in the past decade. This has been due to liberalization, urbanization, increase
in the disposable incomes and altered lifestyle. Furthermore, the boom has also been
fuelled by the reduction in excise duties, de-reservation from the small-scale sector
and the concerted efforts of personal care companies to attract the burgeoning
affluent segment in the middle-class through product and
packaginginnovations.Unlike the perception that the FMCG sector is a producer of
luxury items targeted at the elite, in reality, the sector meets thievery day needs of
the masses. The lower-middle income group accounts for over 60% of the sector's
sales. Rural markets account for 56% of the total domestic FMCG demand. Many of
the global FMCG majors have been present in the country for many decades. But in
the last ten years, many of the smaller rung Indian FMCG companies have gained in
scale. As a result, the unorganized and regional players have witnessed erosion in
market share.

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 3.2-History of FMCG in India

FMCG Sector History

FMCG are products that have a quick shelf turnover, at relatively low cost and don't
require alot of thought, time and financial investment to purchase. Everything from
toothpaste to processed foods and health drinks to body care products comes from
FMCG or alternatively called as consumer packed goods. Three of the largest and
best known examples of Fast Moving Consumer Goods companies are Nestle,
Unilever and Procter & Gamble.

The Indian FMCG sector is an important contributor to the country's GDP. It is the
fourth largest sector in the economy and is responsible for 5% of the total factory
employment in India and captures a market capitalization of around 60,000 crore
rupees.

This has been dueto liberalization, urbanization and increase in the disposable
incomes and altered lifestyle of the people. The lower-middle income group
accounts for over 60% of the sector's sales andrural markets account for 56% of the
total domestic FMCG demand.

FMCG sector isexpected to grow by over 60% by 2011 and by 2015, the sector is
predicted to scale up toUS$33.4 billion.In India, companies like ITC, HLL, Colgate,
Cadbury and Nestle have been a dominant force in the FMCG sector well supported

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by relatively lesscompetition and high entry barriers as import duty was high. SO
these companieswere able to charge a premium for their products. In this context,
themargins were also on the higher side.

With the gradual opening up of theeconomy over the last decade, FMCG companies
have been forced to fight for amarket share. In the process, margins have been
compromised, more so in thelast six years and therefore, FMCG sector witnessed
decline in demand.

The companies which play an important role in the history of FMCG sector are
Godrej andReckitt - Goodknight from Godrej, is worth above Rs 217 crore, followed
by Reckitt'sMortein at Rs 149 crore. In the shampoo category, HLL's Clinic and
Sunsilk made it to thetop 100, whereas P&G's, Head and Shoulders and Pantene are
not far behind. Clinic is nearlydouble the size of Sunsilk. Dabur is among the top
five FMCG companies in India and is aherbal specialist. Asian Paints is enjoying a
formidable presence in the Indian sub-continent,Southeast Asia, Far East, Middle
East, South Pacific, Caribbean, Africa and Europe.

Major Segments Of The FMCG Industry

FoodandBeverages53%

Personal Care20%

Tobacco15%

HouseholdCare10%

Lighting2%

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Household Care​:

The detergents segment is growing at an annual growth rate of 10 to 11 per cent

during the past five years. The local and unorganized players account for a major
share of the total volume of the detergent market. The preference is given to
detergents in urban area compared to bars. Household care segment is featured by
intense competition and high level of penetration. With rapid urbanization,
emergence of small pack size and sachets, the demand for the household care
products is booming.

In washing powder segment, HUL is the leader with ~38 percent of market share.
Other major players are Norma, Henkel and Proctor &Gamble. India has an
abundant supply of caustic soda and soda ash, the chief raw materials required in the

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production of soaps and detergents, which enables the household section of the
industry to excel and grow.

Personal Care

Personal care segment includes personal wash products, hair care products, oral care
products, cosmetics etc. The Indian skin care and cosmetics market is valued at $274
million and is dominated by HUL, Colgate Palmolive, Gillette India andGodrej.

The coconut oil market accounts for 72 per cent share in the hair oil market. The
hair care market can be segmented into hair oils, shampoos, hair colorants &
conditioners, and hair gels. In the branded coconut hair oil market, Marico (with
Parachute) and Dabur are the leading players. Sachet makes up to 40per cent of the
total shampoo sale. Again the market is dominated by HUL with around 47 per cent
market share; P&G occupies second position with market share of around 23 per
cent.

Personal wash can be further segregated into three segments namely Premium,
Economy and Popular. Here also, HUL is the leader with market share of 53
percent; Godrej occupies second position with market share of 10 per cent. Swelling
disposable incomes of the Indian consumers, growth in rural demand and upgrading
to the premium products are the key drivers for future demand growth in
majorFMCG categories. The skin care market is at a primary stage in India. With the
change in life styles, increase in disposable incomes, greater product choice and
availability, people are becoming more alert about personal grooming. The major
players in this segment are Hindustan Unilever with a market share of 54 per cent,
followed by CavinKarewith a market share of 12 per cent and Godrej with a market
share of 3 per cent.

The oral care market can be segmented into toothpaste - 60 per cent; toothpowder -
23 per cent; toothbrushes - 17 per cent. This segment is dominated by
Colgate-Palmolive with market share of 49 per cent, while HUL occupies second

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position with market share of ~30 per cent. In toothpowders market, Colgate
andDabur are the major players.

Food and Beverages

This segment comprises of the food processing industry, health beverage industry,
bread and biscuits, chocolates & confectionery, Mineral Water and ice creams. The
three largest consumed categories of packaged foods are packed tea, biscuits and
soft drinks.

Indian hot beverage market is a tea dominant market. The major share of tea market
is dominated by unorganized players. Leading branded tea players are HUL and
Tata Tea. Major players in food segment are HUL, ITC, Godrej, Nestle and Amul.

Our country has a varied agro-climatic condition which enables to offer extended
draw material base suitable for many FMCG sub sections like food processing
industries etc.

FMCG COMPANIES:-

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68​ | Page
THE TOP 20 COMPANIES IN FMCG SECTOR

S. NO. Companies

1. Hindustan Unilever Ltd.

2. ITC (Indian Tobacco Company)

3. Nestlé India

4. GCMMF (AMUL)

5. DABUR INDIA

6. Asian Paints (India)

7. Cadbury India

8. Britannia Industries

9. Procter & Gamble Hygiene and Health Care

10. Marico Industries

11. Colgate-Palmolive (India)ltd

12. Gillette India ltd.

13. Godfrey Phillips

14. Henkel spic

15. Johnson & Johnson

16. Modi Revlon

17. Nestle

18. Amul India

19. Godrej consumer products ltd.

20. NIRMA LTD

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Some of the leading FMCG companies in the world include:

Colgate-Palmolive

-Famous brands: Colgate toothpaste; Palmolive soap and cleaning products; AJAX
cleaning products.

Coca-Cola

-Famous brands: Coca-Cola; Diet Coke; Fanta; Sprite

General Mills

-Famous brands: Pillsbury; Green Giant; Yoplait dairy products

H. J. Heinz

-Famous brands: Heinz Tomato Ketchup; Lea & Perrins; HP Sauce

Henkel

-Famous brands: Pritt; Sellotape; Schwarzkopf hair products

Johnson & Johnson

-Famous brands: Johnson's Baby; Neutrogena; Acuvue; Listerine oral care

Kimberly-Clark

-Famous brands: Kleenex paper products; Kotex feminine care; Huggies baby
products

Kraft

-Famous brands: Kraft, Milka; Philadelphia; Toblerone

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L'Oréa​l

-Famous brands: L'Oreal Paris, Garnier; Maybelline New York; Biotherm; Kiehl's

Nestlé

-Famous brands: Nestel Pure Life, Nescafe; Nesquik; Kit Kat; Purina

Procter & Gamble

-Famous brands: Ariel, Gillette; Pampers; Olay; Duracell; Pantene

RB (Reckitt Benckiser)

-Famous brands: Dettol/Lysol, Air Wick, Veet; Vanish; Finish; French's Mustard;
Durex

Sara Lee

-Famous brands: Douwe Egberts; Bimbo; Sara Lee; Maryland Clu; Senseo

SC Johnson

-Famous brands: Pledge; Mr Muscle; Duck; Glade; Ziploc

Unilever

-Famous brands: Dove bodycare; Axe; Flora dairy products; Domestos; Cif; PG
Tips

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 3.3- Structure and Characteristic of FMCG Industry

Competition​:

The market of FMCG is very competitive and manufacturers arecoming forward

with the latest ideas and techniques to beat the competition and remain on the top. .
There are top business giants taking lead and several hundred emerging companies
trying hard to come forward and stand with leading FMCGproducers. The easing of
the trade barriers encouraged the MNCs to invest in theIndian market to cater to the
needs of the consumers. The living standards rose in the urban sector due to high
disposable income along with the rise in the purchasing power of the rural families
which increased the sales volume of various manufacturers of the FMCG products in
India. The large-scale companies such ash, Godrej Consumer, Marico, Henkel,
Reckitt Benckiser and Colgate have targeted the rural consumers and have also
expanded their retail chain in the mid-sized towns and villages. On the contrary to
this, Nestle has always targeted the market of urban India and focuses largely upon
the value added products for the elite class or upper middle class population.

Branding​:

Creating strong brands is important for FMCG companies and they devote
considerable money and effort in developing bands. With differentiation on

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functional attributes being difficult to achieve in this competitive market, branding
results in consumer loyalty and sales growth. Leading FMCG firms likely, ITC,
Nestle, Procter & Gamble and GlaxoSmithKline Healthcare–which account for
almost 70 per cent of FMCG revenues in the country–spend almost 10per cent of
their turnover on advertising and brand promotion. The promotion strategy includes
tying up with top actors and other celebrity brand ambassadors, besides going in for
high-profile launches at leading retail mall and outlets.

Distribution Network​:

Given the fragmented nature of the Indian retailing industry and the problems of
infrastructure, FMCG companies need to develop extensive distribution networks to
achieve a high level of penetration in both the urban and rural markets. Once they
are able to create a strong distribution network, it gives them significant advantages
over their competitors. The supply chain of products in the FMCG market in India is
one of the longest supply chains an industry could really have. What has been
observed is that even though these FMCG companies are big multinationals and
Indian but face a major challenge of making their products available in the market in
the right quantities and in the right time. Thesis simply because these companies
don’t really have a wide network of sales agents and other force which is required
and is ideal for catering their products tithe markets. This aspect is taken over by
distributors, wholesalers and retailer whose margins on these products actually
double the price of these products when final consumer buys it. The products in this
industry are transported from manufacturing units via c & f agencies or warehouse
to distributors who further sell the same to wholesalers or stockiest who finally sell
it to the retailers in the market.

Contract manufacturing​:

As FMCG companies concentrate on brand building, product development and

creating distribution networks, they are at the same time outsourcing their

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production requirements to third party manufacturers. Moreover, with several items
reserved for the small scale industry and with theses units enjoying tax incentives,
the contract manufacturing route has grown in importance and popularity.

Large unorganized sector​:

The unorganized sector has a presence in most product categories of the FMCG
sector. Small companies from this sector have used their geographical advantages
and regional presence to reach out to remote areas where large consumer products
have only limited presence. Their low cost structure also gives them an advantage.

3.4- WHAT ARE THE FUTURE HOLDS OF FMCG

The dark clouds of sales growth of the last few years appear to be clearing. Nielsen
expects a steady recovery over the next few years. While we don’t expect growth
rates to touch the levels we saw in 2010, we do expect the numbers to improve.
fmcg forecasted growth The primary factors expected to drive a spurt in sales are a
stronger GDP and rise in employment. An increase in the rate of availability through
distribution expansion is also expected to support sales growth.

Nielsen expects the Indian FMCG sector to touch US$49 billion by 2016. The early
signs of revival include a recovering GDP, a strengthening economy and higher
consumer sentiment about their employment opportunities.

74​ | Page
3.5-FMCG PRODUCTS OF NESTLE AND PARLE

FMCG PRODUCTS OF Nestle:-

Cereals-

Breakfast cereals

Cheerios

Honey Cheerios

Oat Cheerios

75​ | Page
Cheerios Crunchers

Cookie Crisp

Force Flakes

Golden Nuggets

Nesquik Cereal

Almond Oats & More

Honey Oats & More

Raisin Oats & More

Shredded Wheat

Shredded Wheat Bitesize

Shredded Wheat Fruitful

Honey Nut Shredded Wheat

Chilled meats

Herta Frankfurters

Herta Chicken Frankfurters

Herta Jumbo Frankfurters

Ice cream

After Eight ice cream

Double Cream lollies

Fruit Crunch lollies

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Fruit Pastille lollie

Yogurts and desserts

Aero Bubbly Chocolate Dessert

Disney Fromage Frais

Kit Kat Split Pot

Milkybar White Chocolate Dessert

Drinks

Coffee

Nescafé Original

Nescafé Cap Colombie

Nescafé Decaffeinated

Hot chocolate

Milks and creams

Carnation Caramel

Carnation Condensed Milk

Carnation Evaporated Milk

Carnation Extra Thick Cream

Milkshake

Nesquik magic straws

Nesquik milkshake powder

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Nesquick milkshake syrup

Water

Aqua Panna

Buxton

Perrier

Confectionary

Biscuits

Blue Riband

Breakaway

Kit Kat Dark

Boxed chocolates

After Eight

Black Magic

Dairy Box

Cakes and doughnuts

Funtastic Traybake

Jellytots Cup Cakes

Rolo Valentines Cake

Cake mixes

Milkybar My First Baking Mix

78​ | Page
Rolo Choc Brownie

Smarties Funny Faces Cup Cake

Chocolate bars

Aero

Aero Mint

Aero Bubbles

Munchies

After Eight Munchies

Rolo

Smarties

Sugar Confectionary

Fruit Gums

Fruit Pastilles

Jelly Tots

Misc

Baby food

Cerelac

Nutritional supplements

Build-up Milkshake

Build-up Nutrition Soup

79​ | Page
Peptamen Junior

Petfood

Bakers Complete

Beta

FMCG PRODUCTS OF PARLE

Biscuits

Parle G

KrackJack

Monaco

Kreams

Hide & Seek

Hide & Seek Milano

Hide & Seek Bourbon

Parle Actifit Digestive Marie

Parle Marie

Milk Shakti

Namkeen

Khatta Meetha

20-20 Cookies

Golden Arcs

80​ | Page
Festo

Top

Happy Happy

Magix

Coconut Cookies

Hide & Seek Fab

Sweet Confectionery

Londonderry

Melody

Mango Bite

Chox

Kaccha Mango Bite

Poppins

GolGappa

Clovemint

2 in 1Eclairs

Kismi Toffee Bar

Kismi Gold

Snacks

Monaco Smart Chips

81​ | Page
Parle's Wafers

Fulltoss

Munchies

Beverages

Citra

Frooti

Appy

Appy Fizz

LMN

Grappo Fizz

Saint Juice

Water – packaged drinking water

Bisleri

Bailley

82​ | Page
3.7-MARKET SHARE OF NESTLE AND PARLE

Parle product market share

83​ | Page
84​ | Page
Nestle market share

85​ | Page
3.6- MARKET STRATEGIES ADOPTED BY NESTLE
AND PARLE

❖ Marketing Strategy OF NESTLE

​Nestle has adopted a four pronged growth strategy: -1.Gunning the market
with new products and brand extensions.2.Expansion of the distribution network to
small towns for extensiveavailability.3.Reduce prices and introduce smaller
packages for products to make them more affordable (a tool to enter price sensitive
markets).4.Focus on employ training and develop a positive attitude through
enhanced manpower development.5.By year 2003 it expects chocolate &
confectionery to account for one in every third rupee in sale. In the late 1996 fear of
breading complacency by not having continuous improvement, gave birth to an
international sales &marketing improvement teams (SMIT).SMIT maps the latest in
helping towards the target of year.2003. The SMIT exercise is a major global
initiative of Nestle to enhance sales & marketing productivity. Linked with the
already existing BECA project, which in turn emphasizes on excellence by
improving the distribution set up , this gave rise to the following growth objectives
for the year 2003

•Ensure direct coverage of all urban towns in India.

•Expand distribution to reach 1 million retail outlets on a regular basis.

•Work in partnership with the distributor for the achievement of these objectives.

•Provide sustainable solution to optimize our secondary sales from distributor to

retailer.

86​ | Page
 ❖ MARKETING STRATEGIES OF PARLE

•Parle-G has adopted the Market Penetration strategie low price along with
capturing of a large market .

•Also they focus on providing good quality products atthe same time which means it
uses the value pricingmethod .

•Parle-G is available in Re 1, Rs 2 , Rs 4 to Rs 25 packet .

•Profit market for distributors is 4 % and for retailers is10-12 % .

•The value for money positioning helps generate largesales volume for the Parle-G .

•The extensive distribution network built over the yearsis a major strength for
Parle-G .

•Parle-G biscuits are available to consumers even in themost remote places and in
the smallest of villages witha population of just 1500 .

•Parle has nearly 1500 wholesalers catering to 4,25,000retail outlets directly or

indirectly .

•Additionally there are 31 depots and C&F agentssupplying goods to the wide
distribution network .

87​ | Page
3.8- TRENDS Of Fast-Moving Consumer Goods In India

Nielsen predicts that India’s FMCG industry will grow from $37 billion in 2013 to
$49 billion in 2016.

Indian FMCG industry expected to grow 7% in 2014, 10% in 2015 and about 12%
in 2016, taking the sales in 2016 to $49 billion.

Distribution growth, innovations around sachet offerings, employment rates and

index of industrial production (IIP) are key influencers of FMCG sales in India.
India’s FMCG industry is massive.

In 2013, 8.4 million outlets served 1.26 billion people and accounted for US$37
billion in sales.

The last three years have been challenging for India’s FMCG industry. Sales have
been affected by a weak economy and high inflation. Consumer confidence which
we found has a strong correlation with FMCG sales, has also dipped in this period.
In more recent months, however, confidence is rebounding and the sector appears to
be one with perceptible signs of a sustained recovery.

The FMCG Industry Milieu

88​ | Page
To understand the declining FMCG growth trend and predict how the future looks
like, we must first understand the sales environment. There are several forces at play
that affect the FMCG industry in India.

Through multivariate regression modelling and custom forecasting, Nielsen arrived

at drivers-based FMCG forecasts incorporating a range of influencing variables.

This helps in understanding market dynamics, gain foresight into current and
emerging trends and to plan better. Nielsen used a three step approach to forecast
FMCG sales value.

Identify the drivers impacting sales through regression modeling Quantify the
impact of each of the drivers Finally, forecast FMCG sales for the next three years
using the identified drivers and their future values

All the above variables were modelled against FMCG sales to attain sales drivers.

Using these drivers and their impact on FMCG, we were able to forecast sales for
2014 - 2016.

Drivers Of FMCG Sales

Overall 8 factors have emerged which play a direct role in influencing FMCG sales.
We have classified these drivers of sales into two categories: those that marketers
can control and those they cannot. The good news is marketers can directly
influence more than half of the drivers of sales.

Given the Indian FMCG consumer’s preference for traditional trade outlets and the
challenge for marketers in actually reaching the consumer, it’s understandable that
availability is the biggest driver of FMCG sales. This is followed by employment
rates, which generates income, and then proliferation of sachets (low volume packs),
which have a low outlay and are easy on the wallet. Sachet packs also play a strong
role in recruiting new buyers and in inducing trials.

89​ | Page
Using Sales Drivers To Explain Growth On Decline

FMCG growth has been slowing for some time now, sliding by 8.1% from 2010 to
2013. In a clear indication that sales drivers have played a part in this decline, a
slowdown was seen in the rate of distribution expansion and the rate of sachet
launches during the same period. Admittedly, weakening macroeconomic variables
also contributed to the overall FMCG slowdown.

Here is a closer look at how some of the drivers affect FMCG sales:

Availability​: The slowdown in distribution expansion has held up growth. The

distribution expansion in 2013 has slowed down to 1.1% from a healthy 2.3% in
2010.

Awareness​: While the extent of the impact is smaller, yet, the effect of lower
television gross rating points (GRP) has affected sales.

Macro factors​: Declining FMCG growth seems to be reflective of the Indian

economy as a whole. The key macroeconomic indicators have weakened; GDP
slowed from 7.9% in 2009 to 5.7% as of Nov. 12, 2013. The Index of Industrial
Production (IIP) has also plunged from 5.8% in 2009 to 1.7% in November 2013.
This has affected the economy and the consumers’ purchasing power.

Sachet (Low volume packs): New product launches through sachets have fuelled
growth over the years. The growth in the number of low-volume packs hit 31.1%
from 2009 to 2010. The rate then dropped to 10.5% from 2012 to 2013. This drop in
sachet innovations has impacted FMCG growth.

90​ | Page
 4.0-COLLECTION OF DATA

1.Do you purchase fmcg products?

a. YES [ ] b. NO [ ]

91​ | Page
COMMENT:- As per above chart 50/50 people said “yes” they purchase fmcg
products.

2.Which company do you prefer?

a.nestle [ ] b.parle [ ] c.britania[ ] d.cadbury[ ]

COMMENT:- As per above chart 18 out of 50 prefer nestle company.

3. How did you come to know about the FMCG product?

92​ | Page
a.By friends/family: [ ] b. Direct mailers: [ ]c. Press Ads: [ ] d. Reference website:
[ ]e. T.V. Ads: [ ]

COMMENT:- As per above chart most people come to know about FMCG products
by TV.Ads.

4. What is the most important factor that matters while buying an

FMCG?

a. Quality: [ ] b. Price: [ ] c. Service: [ ]

93​ | Page
COMMENT:- As per above chart the most important factor that matter while buying
an fmcg product is a quality.

5. Which configuration would you decide on while buying an

FMCG?

a. Intermediaries: [ ] b. Standard: [ ]c. Latest / Advanced: [ ]

COMMENT:- As per above chart maximum consumer would like to buy

latest/advanced fmcg products.

6. Are you satisfied with the quality of the product?

a. Yes: [ ] b. No: [ ]

94​ | Page
COMMENT:- As per above chart we see that consumer are satisfied by the quality
of product.

7. Do you think the price of FMCG product is high / low compared

to Competitor’s product?

a. Very good: [ ] b. High: [ ]c. Average: [ ] d. Same: [ ]

COMMENT:- As per above chart consumer thinks that the price of fmcg product is
average compared to competitor’s product.

95​ | Page
8. How often do you buy this product of FMCG?

a. Daily: [ ] b. Monthly: [ ]c. Weekly: [ ] d. Occasionally: [ ]

COMMENT:- maximum people purchase fmcg product daily.

9. What is your opinion about the performance of FMCG product?

a. Outstanding: [ ] b. excellent: [ ]c. Good: [ ] d. Average: [ ]

COMMENT:- As per consumer opinion the performance of fmcg product is good.

96​ | Page
10. Do the various schemes / promotional activities affect your
purchase?

a. Yes: [ ] b. No: [ ]

COMMENT:- NO , the various schemes/promotional activities didn’t affect the

purchase of fmcg product.

11. which company provide wide range of product?

a.nestle [ ] b.parle [ ] c.britania[ ] d.cadbury [ ]

97​ | Page
COMMENT:- As per above chart parle company provides wide range of product.

12.As per terms of quality, which company serves more efficiency in

household products?

a.nestle [ ] b.parle [ ] c.britania[ ] d.cadbury [ ]

COMMENT:- As per above chart it shows that as per terms of quality, NESTLE
company serves more efficiency in household product.

98​ | Page
13.Which company adopts better marketing strategy?

a.nestle [ ] b.parle [ ] c.britania[ ] d.cadbury [ ]

COMMENT:- As per above chart CADBURY company adopts better marketing

strategy.

14.Consumer complaints are resolved by which company at faster

rate?

a.nestle [ ] b.parle [ ] c.britania[ ] d.cadbury [ ]

99​ | Page
COMMENT:- As per above chart Consumer complaints are resolved by NESTLE
company at faster rate

15.Would you like to suggest the company you prefer to others?

a.nestle [ ] b.parle [ ] c.britania[ ] d.cadbury [ ]

100​ | Page
COMMENT:- As per above chart, maximum consumer will suggest NESTLE
company to other.

APPENDIX

SURVEY ON FAST MOVING CONSUMER GOODS

“factors to be considered while choosing a FMCG products” as a part of study. I

request you to provide the required information for the completion of my study. And
I Promise that the information is used exclusively for academic purpose only.

1.Do you purchase fmcg products?

101​ | Page
a. YES [ ] b. NO [ ]

2.Which company do you prefer?

a.nestle [ ] b.parle [ ] c.britania[ ] d.cadbury[ ]

3. How did you come to know about the FMCG product?

a. By friends/family: [ ] b. Direct mailers: [ ]c. Press Ads: [ ] d. Reference website:

[ ]e. T.V. Ads: [ ]

4. What is the most important factor that matters while buying an FMCG?

a. Quality: [ ] b. Price: [ ] c. Service: [ ]

5. Which configuration would you decide on while buying an FMCG?

a. Intermediaries: [ ] b. Standard: [ ]c. Latest / Advanced: [ ]

6. Are you satisfied with the quality of the product?

a. Yes: [ ] b. No: [ ]

7. Do you think the price of FMCG product is high / low compared toCompetitor’s
product?

a. Very good: [ ] b. High: [ ]c. Average: [ ] d. Same: [ ]

8. How often do you buy this product of FMCG?

a. Daily: [ ] b. Monthly: [ ]c. Weekly: [ ] d. Occasionally: [ ]

9. What is your opinion about the performance of FMCG product?

a. Outstanding: [ ] b. excellent: [ ]c. Good: [ ] d. Average: [ ]

10. Do the various schemes / promotional activities affect your purchase?

a. Yes: [ ] b. No: [ ]

102​ | Page
11. which company provide wide range of product?

a.nestle [ ] b.parle [ ] c.britania[ ] d.cadbury [ ]

12.As per terms of quality, which company serves more efficiency in household
products?

a.nestle [ ] b.parle [ ] c.britania[ ] d.cadbury [ ]

13.Which company adopts better marketing strategy?

a.nestle [ ] b.parle [ ] c.britania[ ] d.cadbury [ ]

14.Consumer complaints are resolved by which company at faster rate?

a.nestle [ ] b.parle [ ] c.britania[ ] d.cadbury [ ]

15.Would you like to suggest the company you prefer to others?

a.nestle [ ] b.parle [ ] c.britania[ ] d.cadbury [ ]

Date:
SIGNATURE

BIBLIOGRAPHY

103​ | Page
www.nestle.com

www.google.comNEWSPAPER

MAGZINES

- www.parle.com

- www.nestleindia.com

- www.scribd.com

- www.parleproduct.com

- www.moneycontrol.com

104​ | Page