A PROJECT REPORT ON

Market research on the presence of Vadilal Ice-creams and also the reasons for low sales in Navi Mumbai region

Submitted in partial fulfillment of the requirement For MBA degree course By SANDEEP RAMASARE YADAV Roll No: C-86 Under the guidance of Faculty Guide: guide: Mr.Iftiqar Mistry Asst. Professor NCRDSIMS Navi Mumbai Mr. Sandeep Sharma Regional Sales Manager Vadilal Industries Ltd. Mumbai Company

Sterling Institute of Management Studies

DECLARATION

I hereby declare that the project study titled Market research on the presence of Vadilal Ice-creams and also the reasons for low sales in Navi Mumbai region is my original work carried out during the period from May 2013 to July 2013 under the guidance of Asst. Professor Mr. Iftiqar Misty and Mr. Sandeep Sharma, Regional Sales Manager at Vadilal Industries Ltd, Mumbai. I also declare that this project has not been submitted nor shall it be submitted in future to any other University or Institution for the award of any other Degree or diploma.

DATE: PLACE: Nerul, Navi Mumbai Sandeep Yadav

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Acknowledgement

I would like to thank Ms. Ayati Bose, Asst. Professor without whom an internship with, Vadilal Ice-creams Ltd, Mumbai would not have been possible. I am grateful to her for bringing Vadilal Company to the institute for the internship.

I express my gratitude to the Vadilal Industries Ltd. for having given me an opportunity to work with them and make the best out of my internship.

I thank my faculty guide, Mr Iftiqar Misty who had constantly guided and supported me throughout the internship period. My heartfelt gratitude also goes out to Mr. Sandeep Sharma (Regional Sales Manager) and Mr. Kshitij Bhatnagar (Area Sales Manager) for having co-operated with me and guided me throughout my internship period.

I thank NCRDs Sterling Institute of Management Studies for having given me this opportunity to put to practice, the theoretical knowledge that I imparted from the program.

I take this opportunity to thank my parents and friends who have been with me and offered emotional strength and moral support.

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Certificate from SIMS

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Certificate from Organization

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Table of Contents

SR. NO. 1 2 3 4 5 6 7 8 9 10 11 12 13

PARTICULARS Executive Summary A Brief Insight: Ice-cream Industry Introduction Marketing Mix of Vadilal Ice-creams Objectives of the Research Literature Review Research Methodology Data Collection Data Analysis Findings Recommendations Conclusion Bibliography

PAGE NO. 7 8 9 11 13 20 30 33 37 49 50 52 53

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Executive Summary

Vadilal (Vadilal Industries Limited) from a small outlet in Ahmedabad over 80 years back, Vadilal Industries Ltd has today emerged as Indias second largest ice cream player. The company is also one of the largest processed food players in India with significant exports of frozen vegetables and ready to eat snacks, curries and breads. Vadilals aim is to become an Indian MNC in Ice creams and frozen foods and to provide products and services at an affordable price without compromising on quality. Vadilal Industries has extensive reach. A major success factor has been its ability to cater to different market segments through multiple product ranges. Vadilal has range of ice creams in the country with 150 plus flavours and they are sold in a variety of more than 250 packs and forms. The range includes cones, candies, bars, ice-lollies, small cups, big cups, family packs, and economy packs. It offers something for all tastes, preferences and pockets. This is a primary research project. The objective of the project is to find out the overall presence of Vadilal Ice-cream in Navi Mumbai area, to find the reasons for low sales in Navi Mumbai region, to find how many retail stores were interested in buying deep freezer with deposit scheme provided by Vadilal, to find strategies adopted by the competitors to gain competitive advantage, to make marketing and distribution strategies according to the data collected. The data collected is through the primary and secondary sources. The primary data was collected through survey with the help of questionnaire. The data collected through survey helps the find the out the presence of Vadilal Ice-creams in Navi Mumbai region and also the reasons for low sales. The data help the company to build strong and effective marketing and distribution strategies that will them in increasing the sales. The secondary data was collected through internet, newspaper articles, magazines, books. It helps in gaining knowledge about the companys earlier strategies and overall information about the company.

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A Brief Insight: Ice-cream Industry

Ice cream (derived from earlier iced cream or cream ice) is a frozen dessert usually made from dairy products, such as milk and cream and often combined with fruits or other ingredients and flavours. Most varieties contain sugar, although some are made with other sweeteners. In some cases, artificial flavourings and colourings are used in addition to, or instead of, the natural ingredients. Ice cream industry occupies important place in India. It is one of the consumer goods industries its products is important popular diet. India is an agriculture-based country because of the large number of cattle and large milk production most of the dairy and ice-cream industries has developed and India is well ranked in the world. Ice cream industry has brought magnificent change in the rural economy. It provides employment to the marginal farmers. Today the competition in ice-cream of players like Amul, Kwality Walls, and Vadilal etc. as ice cream has been a regular edible item the consumption of ice cream is more. In 1983 when Indian Government Issued a control in which the certain price level was fixed. It has an important role in employment generation and reducing the migration of villagers towards the town and cities for live hood. The ice cream industry in India is worth Rs. 2,000 crores. The industry can be divided into the branded market and the unbranded market. The branded market at present is 100 million liters per annum valued at Rs. 800 crores. The per capita consumption of ice creams in India is just 300 ml per annum, compared to 22 liters in the US, 18 liters in Australia, 14 liters in Sweden. India is a way too far behind even in terms of the world average per capita ice cream consumption. But still, whatever may be the season, Icecream lovers like eating ice-cream, they enjoy different flavours all throughout the year.

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Introduction

Vadilal (Vadilal Industries Limited) from a small outlet in Ahmedabad over 80 years back, Vadilal Industries Ltd has today emerged as Indias second largest ice cream player. The company is also one of the largest processed food players in India with significant exports of frozen vegetables and ready to eat snacks, curries and breads. Vadilals aim is to become an Indian MNC in Ice-cream and frozen foods and to provide products and services at an affordable price without compromising on quality. Vadilal Industries has come a long way since its inception in 1907, when Vadilal Gandhi, the great-grand father of Virendra R. Gandhi, Rajesh R. Gandhi and Devanshu L. Gandhi, started a soda fountain. He passed on the business to his son, Ranchod Lal, who ran a one-man operation, and, with a hand cranked machine, started a small retail outlet in 1926. Eventually, Ranchod Lal's sons, Ramchandra and Lakshman, inherited the business and they were instrumental in giving a new direction to the company. The duo imparted a new vision to the venture and infused a spirit of calculated risk-taking into the firm. As a result, by the 1970s, the Vadilal Company had already evolved into a modern corporate entity. Vadilal Industries has extensive reach. A major success factor has been its ability to cater to different market segments through multiple product ranges. Vadilal has range of ice creams in the country with 150 plus flavours and they are sold in a variety of more than 250 packs and forms. The range includes cones, candies, bars, ice-lollies, small cups, big cups, family packs, and economy packs. It offers something for all tastes, preferences and pockets. Vadilal entered the processed foods industry to optimise utilisation of its extensive cold chain network in the 1990s. It currently caters to the domestic and export markets with products such as frozen vegetables and ready to eat snacks, curries and breads. This business is poised for strong growth in the coming years owing to greater urbanisation within India and increasing demand for Indian food amongst developed regions like the USA and Western Europe.
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The companys national ice cream market share would have been even higher but for the fact that it does not operate in major consuming regions like Maharashtra and the four southern states as these are covered by another faction of the Vadilal family. Vadilal has been graded with a two star grading status by the Government of India. The company has also been awarded certification for excellence in export performance by APEDA. It has also been certified by the Export Inspection AgencyGovernment of India. The products at Vadilal are endorsed by ISO 9001:2008, ISO 22000:2005, a BRC certified unit, HACCP certified and an INTERTEK certified unit, confirming requirements of Global Standards for food safety. Some of the strategic marketing, branding and PR activities carried out by Vadilal include participating in the national level exhibition, ATL and BTL activities. Carrying out these activities has increased the brand recall value of the company. Vadilal has also plugged in with advertisements at the velocity of 360 degrees and its momentum is reflected as hoardings, print and media.

Organization Structure

Name
C M Maniar Kshitish M Shah Nikhil Patel Nikhil Patel Devanshu L Gandhi Niranjana A. Kapadia Rajesh K Pandya Rajesh R Gandhi Ramachandra R Gandhi Rohit J Patel Virendra R Gandhi

Designation
Independent Director Independent Director Co. Secretary & Compliance Officer Secretary CEO & Managing Director Additional Director Independent Director Managing Director Chairman Emeritus Independent Director Vice Chairman & Managing Director

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Marketing Mix of Vadilal Ice-creams

What is marketing? The definition that many marketers learn as they start out in the industry is: Putting the right product in the right place, at the right price, at the right time The marketing mix is a good place to start when you are thinking through your plans for a product or service. "Marketing mix" is a general phrase used to describe the different kinds of choices organizations have to make in the whole process of bringing a product or service to market. The 4Ps is one way probably the best-known way of defining the marketing mix, and was first expressed in 1960 by E J McCarthy. The 4Ps are: Product (or Service) Place Price Promotion

Product:
Vadilal offers the widest range of ice creams and frozen desserts (above 250 Stock Keeping units) in the country in packs including cups, party packs, family bricks, dollies, cones and candies. Something for all tastes, preference and budgets. To meet with the consumer demand on regular basis, Vadilal introduces new flavours for different segments of customers throughout the year. Vadilal Ice-creams come in a wide variety of flavors, with additives such as chocolate flakes or chips, nuts, fruit, and even small candies/sweets. Some of the most trendy ice cream flavors of Vadilal in markets are vanilla, chocolate, strawberry, and butter scotch. Many people like ice cream sundaes of our Happinezz Parlor, which regularly have ice cream, hot fudge, nuts, whipped cream, cherries and other toppings of their choice.

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Cones

Cups

Kulfi

Candy

Vadilal Party Packs

Vadilal Novelties

Vadilal Bulk Packs

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Place:
Vadilal Industries has two ice cream production facilities one at Pundhra in Gandhinagar district, Gujarat and the other one at Bareilly in Uttar Pradesh. It has a very strong distribution network of 50,000 retailers, 250 SKUs (stock keeping units), 550 distributors, 32 CNF and 250 vehicles for delivery of goods. Through the franchisee route, Vadilal has set up over 140 Happinezz parlors for selling ice creams and new ones are coming up every month. The presence of Vadilal Ice-creams in Maharashtra state is very low as compared to the presence in north region. The head office of Vadilal Ice-creams in Mumbai is located in Vile Parle. In Mumbai and Navi Mumbai you will not find any Happinezz parlours. Mostly, Vadilal operate in franchise system. They find customers who are interested in opening the parlour. There is one ice-cream parlour in Seawoods, Navi Mumbai (Ganesh Ice-cream Parlour).

Vadilal Happinezz Parlour in Gujarat

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Price:
Price includes the pricing strategy of the company for its products. How much customer should pay for a product? Pricing strategy not only related to the profit margins but also helps in finding target customers. Pricing decision also influence the choice of marketing channels. Price decisions include: Pricing Strategy (Penetration, Skim, etc) List Price payment period Discounts Financing Credit terms Using price as a weapon for rivals is as old as mankind, but its risky too. Consumers are often sensitive for price, discounts and additional offers. Another aspect of pricing is that expensive products are considered of good quality. Vadilal has implemented penetration pricing strategy for its consumers. Since the majority of market share is with Amul and Kwality Walls in Mumbai and Navi Mumbai region, so penetration strategy helps them to make a strong base for its brand and also reflects the understanding of the needs of the consumer in these areas. With consumers not so keen on brand loyalty, they shift from one brand to another as per availability. The Company primarily focuses on increasing the ice-cream consumption by continuously offering novel products at affordable rates.

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Promotion:
Promotion is the business of communicating with customers. It will provide information that will assist them in making a decision to purchase a product or service. The razzmatazz, pace and creativity of some promotional activities are almost alien to normal business activities. The cost associated with promotion or advertising goods and services often represents a sizeable proportion of the overall cost of producing an item. However, successful promotion increases sales so that advertising and other costs are spread over a larger output. Though increased promotional activity is often a sign of a response to a problem such as competitive activity, it enables an organisation to develop and build up a succession of messages and can be extremely cost-effective. In a unique consumer-outreach initiative, Vadilal Industries Limited, India's second largest ice cream producer, has come out with an innovative strategy of selecting youngsters aged between 15 to 26 years for its 2013 calendar. The company through its 'Freeze the Moment' contest is inviting applications from youth across the country to be featured in its calendar for 2013. The winners of the contest would not only win prizes but also become celebrities with their photos being displayed across India. The shortlisted candidates may also get a fair chance to feature in television commercial of Vadilal Ice Cream.

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Objectives of the Research

To find out the overall presence of Vadilal Ice-cream in Navi Mumbai area. To find the reasons for low sales in Navi Mumbai region. To find how many retail stores were interested in buying deep freezer with deposit scheme provided by Vadilal. To find strategies adopted by the competitors to gain competitive advantage. To make marketing and distribution strategies according to the data collected.

Task given by the Regional Sales Manager

The market research of the whole Navi Mumbai region was out of scope in terms of time and therefore certain location was allocated to me by Mr. Sandeep Sharma (Regional Sales Manager) which is Panvel (Old and New), Khanda Colony, Kamothe, Koperkhairane, Airoli, Turbhe and Seawood. In these locations, I tracked all the retail stores including restaurants which sell ice-creams and try to get the necessary details from them. Mr. Kshitij gave us the copy of Every Dealer Survey. Every Dealer Survey is a formatted form of questionnaire which I have to fill and when I visit the retail store. After completing the survey in the particular location, then I have to prepare a report in excel sheet filling all the details and then send it to both Mr. Kshitij Bhatnagar (Area Sales Manager) and Mr. Sandeep Sharma (Regional Sales Manager).

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Literature Review

A literature review is a body of text that aims to review the critical points of current knowledge including substantive findings as well as theoretical and methodological contributions to a particular topic. Literature reviews are secondary sources, and as such, do not report any new or original experimental work. Most often associated with academic-oriented literature, such as a thesis, a literature review usually precedes a research proposal and results section. Its ultimate goal is to bring the reader up to date with current literature on a topic and forms the basis for another goal, such as future research that may be needed in the area. For this market research, secondary data was collected from certain articles which were published in various newspaper, websites, blog, books were referred. This helped me to know about information related to Vadilal Industries Ltd. This include company history, marketing and financial status of the company, promotional activities, culture of the organisation, etc.

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Vadilal eyes 25% share of ice cream market in 2-3 yrs

Press Trust of India | New Delhi 03 May 11 | 04:13

Ice cream maker Vadilal Industries today said it is targeting sales growth of 40% in 2011-12, with plans to capture 25% market share in the next 2-3 years. The company has also launched a range of new products targeting premium ice cream segment of the market. "Currently, Vadilal is the second largest ice cream player in India, with 20% market share. In the next 2-3 years, we are targeting 25% share," Vadilal Industries M D Rajesh Gandhi told reporters here. According to Gandhi, the total ice cream market is estimated at Rs 2,500 crores, with the organized segment contributing Rs 1,500 crores. The industry has been growing at a CAGR of 15% in the last five years. "As against the industry average, we are working hard to achieve a sales growth of 40% in 2011-12," Gandhi said. "In the next 2-3 years, we expect our premium products under Badabite, Flingo and Gourmet brands to contribute around 10% to the company's total sales," Gandhi said. The firm is also looking to increase the number of exclusive 'Hapinezz' outlets to sell its ice creams from 200 at present to 400 in the next 18 months. "Most of the new outlets would be owned and run by franchisees," Gandhi said. The company has increased its production capacity from 2.25 lakh litres per day to 3.25 lakh litres per day from April, 2011 onwards at its facilities located at Pundhra in Gandhinagar (Gujarat) and at Bareilly in Uttar Pradesh. "In the last two years, the company has invested Rs 80 crores to expand manufacturing capacity and strengthen sales support," Gandhi said. Besides selling ice creams, the company also offers a range of ready-to-eat food items primarily catering to 45 countries outside India. For the 2009-10 fiscal, the company had registered revenues of Rs 188.91 crores and net profit of Rs 5.75 crores. The firm's shares were trading at Rs 176 in the late afternoon trade on the Bombay Stock Exchange, up 5.71% from the previous close.

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Vadilal launches high-end ice cream brands, to generate Rs 50 cr new sales

The Hindu Business Line | Gandhinagar April 25, 2013

Indias second largest ice cream player Vadilal Industries Ltd on Thursday announced the launch of over a dozen high-end products for this summer which it says would generate fresh revenues of Rs 50 crore. The Artisan range of ice cream log, pastry, sandwich, cookie pie sandwich, ice cream bar (Sneak-a-Bar) and Kevada Matka kulfi are among those products being introduced in the market this summer, Rajesh Gandhi, Managing Director, told presspersons after a plant visit here. The company is also launching a new range of ice candies made with fruit pulp in flavors like cranberry, kiwi and mixed-fruits under the Falala brand name, he said. New variants of certain other brands have also been put in the market. In view of popularity of its chilled mango juice in summer, Vadilal has introduced a one-kg pack of alphonso mango this summer, Gandhi said. Until recently, Vadilal was known for its mass-based, mid-end and low-end ice creams across 16 states in the country where it has presence. Vadilal Industries has ice cream manufacturing plants at Gandhinagar in Gujarat and Bareily in Uttar Pradesh with a combined capacity to process 3.40 lakh litres of milk per day. It has invested Rs 150 crore over the last three years in upgradation of technology, he said. We were the first ice cream player in the country to bring extrusion technology for ice creams. We also have the latest and fastest cone-making machine in the country. The company recently entered Indian flavored milk market with its new Power Sip under the Vadilal Quick Treat umbrella brand. This initiative is part of the companys long term strategy to offer a wider range of frozen food products to consumers and its first major product launch in the beverages market. In 2012-13, the company is expected to touch a turnover of Rs 450 crore.

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1907 Vadilal Freeze-frame

Maulik Pathak | LiveMint | Mon, Aug 13 2012 | 11 28 AM IST

They began when ice cream wasnt even an industry and are still around the top of the cone. A small restaurant in a noisy corner of Teen Darwaja in Ahmedabad still bears the sign Vadilal Soda Fountain105 years later. From selling sodas in 1907, the Gandhis have travelled four generations with their brand Vadilal, to their new corporate office in Navrangpura, less than 5km from their first outlet. My forefather had imported furniture from Italy and we were among the first to get an electric connection in the city, says Rajesh Gandhi, managing director of Vadilal Industries, the flagship firm of the Vadilal Group. Initially, founder Vadilal Gandhi used to make ice cream by the traditional Kothi method, using a hand-operated machine to churn milk with other ingredients, ice and salt. They even offered home delivery, with ice creams packed in thermos boxes. In

1926, they imported ice-cream making machines, paying custom duty of 300-350%. Vadilal, which had expanded to four ice-cream shops before independence, became popular for its cassata ice cream, which it introduced in the 1950s. It remained a city brand till 1972-73. Ramchandra Gandhi, 86, chairman of Vadilal Industries and father of Rajesh, took over his grandfathers business in 1942, turning it into an over Rs 400 crore empire by the financial year 2011-12 with the support of his brother Lakshman Gandhi and other family members. The family says they did consider changing the brand name Vadilal in the 1980s. We decided to stick to Vadilal because when we looked around we found that a lot of brands named after their founders, like Mafatlal and Ford, were successful, says Rajesh. In 1972-73, the company had 8-10 outlets in Ahmedabad. They spent five-six years consolidating the business. The group invested Rs 25 lakh in 1972 in setting up an ice-cream factory at Pundhra, Gandhinagar district. Ice cream was not seen as an industry then. Everybody said we would go bankrupt. In the first year of operations, our factory got flooded.

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But we have never looked back, Rajesh says. By the late 1970s, Kwality, Joy and Vadilal had a major share of the ice-cream industry that was opening up to multinationals. The fact that Vadilals ice cream is vegetarian helped them remain ahead. They even ran ad campaigns in the late 1970s suggesting their ice creams could be consumed even by people observing a fast. Rajesh says there were apprehensions in the market at the time about other ice-cream makers using gelatin. A multinational company tried to buy them out in 1985. They even sent a muscleman to our office to threaten us. We were told that the sea is rough and it was time for us to jump, Rajesh recalls, refusing to divulge the name of the company. Vadilal decided to go in for nationwide expansion. In the early 1990s, there was a split in the family, with Shailesh Gandhi, brother of Rajesh and son of Ramchandra, being given a factory in Tarapur, Pune and territorial rights in Maharashtra and south India. Both families continue to use the same brand name but there were territorial restrictions. Today, we are present in 16 states while my brother is in five states, says Rajesh. In 1996, the Gujarat Co-operative Milk Marketing Federation (GCMMF), selling its products under the brand name Amul, captured the market, becoming No. 1 by 2001. Vadilal is the countrys second-largest ice cream brand by sales. Vadilal has the largest range of ice creams in the country, with more than 150 flavours sold in more than 300 packs and forms. Today, the ice-cream market in India is estimated at Rs 2,500 crores in the organized sector. Vadilal Industries, which has been growing at about 30% annually for the last 10 years, aims to touch Rs 450 crores this fiscal. Like tea tasters, Vadilal has a core team of in -house ice-cream experts who taste 15-20 products a day. Vadilal introduces one or two products every month while dropping an equal number to avoid making the product basket unhealthy, Rajesh says. It has 50,000 dealers across India and 200 Happinezz Parlours, most franchisee outlets. Vadilal Industries also entered the processed foods industry in the early 1990s and is today one of the largest players in India. Currently, it exports approximately 175 products under the Vadilal Quick Treat and Garden Fresh brands to nearly 45 countries.
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Interview with Mr. Rajesh R. Gandhi, Managing Director, Vadilal Industries Ltd.
Anil Mascarenhas | IIFL | Sep 10, 2012 | 11:52

Replying to Anil Mascarenhas of IIFL, Rajesh Gandhi says, With the unorganized market covering a large chunk (60%) of the Indian ice cream market and already crowded organized sector, all the big and small brands have to provide myriad choices to consumers.

We know you more as an ice-cream maker. Give us a brief overview of how your business model has evolved over the years. Brief us on your various businesses. Vadilal has come a long way since it was started in 1907 as a soda fountain shop in Ahmedabad, Gujarat. After venturing into ice creams around 1920s, today we are the second largest player in terms of turnover. We are also present in the processed food industry and currently have a basket of around 175 products that are exported to nearly 45 countries.

Give us an overview of the ice-cream market. A lot has changed with the entry of new brands over the years. The ice cream market in India is still in its nascent stage with approximate per capita consumption of only 350 ml, which is far lower from the global average of 2-3 liters. We see this as a great opportunity to capture more and more segments with even more exciting products to offer. With the unorganized market covering a large chunk (60%) of the Indian ice cream market and already crowded organized sector, all the big and small brands have to provide myriad choices to consumers. These choices are mostly in terms of flavours, taste and presentation as well as the price bracket.

What is the size of the market? What is your market share? The Indian ice cream market size is nearly Rs35bn and we enjoy 14% of the organised ice cream market. The company is growing at 20% which is slightly higher than the industry average growth rate.

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How has the response been to Badabite, Flingo and Gourmet? Which are the areas they are available? Badabite and Flingo are youth oriented products under the impulse category of ice creams while Gourmet, a super premium product, is targeted more towards young families. Each of these three products is also available at all Vadilal Happinezz parlours. The response has been overwhelming. We introduced a new variant Mocha Fudge in Flingo as well as hygienic IML tubs of 500 ml in Gourmet which have also been a huge hit with consumers.

Give us an update on your Happinezz ice cream parlours. How many parlours do you have and what are your expansion plans? We have around 200 Happinezz branded stores and we plan to double the numbers in the coming two years.

How are you dealing with input cost rise? With the rising costs like milk prices, raw materials, labour costs, logistics and other costs owing to increased inflation, we have increased our prices by 7% with effect from February 2012.

The power problem affects most industries including yours. Is it something which each retailer manages at their end or do you also offer some support? Yes, the power problem affects most industries. For the Food and Beverage or Dairy industry, the power problem mainly affects the cold chain of a company. Due to non availability of power in many villages the expansion is restricted.

You also ventured into branded mango milkshake, etc. How are your processed and frozen food plants doing? Vadilal has been a front runner in the branded mango pulp market since more than two decades now. After capturing Gujarat, we have successfully taken over Mumbai and Rajasthan with our brands like Garden Fresh Kerino Ras. Moreover, we are hot favourites amongst non-resident Indians at a global level. We export our frozen mango pulp and mango milk shake to USA, Canada, Australia, New Zealand, UK, Germany, Netherlands as well as Middle-east countries like Saudi Arabia, Kuwait, Oman and Dubai.
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Vadilal has been one of the most recognized processed food players in India as well as abroad. It has approximately 175 products under the Vadilal Quick Treat and Garden Fresh brands which are exported to nearly 45 countries around the world. The range of products also includes frozen vegetables; frozen & canned fruit based products, ready-to-eat curried vegetables & ready-to-cook frozen items such as parathas, naans and other snacks.

What are the new segments you plan to enter? We anticipate consolidating our strength in the segments like youth, family and kids in the ice cream and frozen dessert categories. We plan to launch various new formats and flavours in the mass premium segment targeting various age groups and purchase occasions this year to further strengthen our position. We are also expanding in the premium segment of customised ice creams through coldstone concept called as "ICEBERG". In the processed food division, we plan to venture into the HoReCa and Cash&Carry formats with a new set of products after observing an increasing demand. We want to launch products which have the flavours of local delicacies of various places.

What are your capex plans? How would they be funded? Capex plans are well constructed this year. We have a planning to invest around Rs400mn. This would be further divided as Rs300mn for ice cream division and Rs100mn for processed food division. For ice cream division, we plan Rs100mn for Sales Generating assets. The rest is for increasing the cold storage capacity, dairy equipments and towards automation & increasing production capacity. These funds would be raised through term loan.

Brief us on your financials. What is the outlook? The last financial year has been quite good for us. We grew by 23% with a jump of Rs580mn in our net profit for year ended on March 31, 2012. We had made some significant expansion of our production facilities which has given us fair amount of results. Moreover, new products targeting new market segment kids as well as introducing new variants in Flingo and Gourmet has been profitable too. Apart from the ice cream sales which contribute to a major part of the companys sales, the processed foods business too has been doing well in the domestic as well as the global markets.

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Tell us about your manufacturing units and its capacity. We have two manufacturing units for ice creams one at Pundhra (Gujarat) & Bareilly (U.P) And 1 for processed foods at Dharampur (Valsad).We increased the manufacturing capacity of our plants at Pundhra and Bareilly by 50% to 3.3 lakh litres per day.

What is your view on competition? In the ice cream industry we are the second largest player in terms of turnover. The unorganized sector which includes regional ice cream players holds a considerable market size. So our major competitors are the top five national ice cream brands and local players. Because of our presence since the early 90s in the processed food division, we have an upper hand in the industry, which is at its nascent stage in India. Reports often describe a handicap you have of not being able to go south because of a family separation restriction. How long will that continue? What are your plans for the north? It is true that we could not enter into south India except Tamil Nadu under the same brand as family had an understanding at the time of separation and the restriction may continue. On the contrary, we are much more aggressive in North India, especially in Delhi, UP, Uttrakhand, Punjab, Chandigarh, and Haryana. We are increasing the number of distribution and stock points. Also, we have invested & increased the number of Push carts for ice creams.

What are your marketing initiatives planned? In the kids segment, we plan to continue last years Freeze the Moment property, aggressive marketing campaign and offer many fun giveaways along with Ice Trooper cool treats. We will increase the physical touch points with our consumers through ever expanding dealers, FOW (Fridge On Wheels) and Happinezz parlor network. We also plan various BTL activities to enhance consumer experience with Vadilal. We will organize innovative cross promotional activities to enhance the brand engagement levels with consumers and use the digital space as well actively for the same. We also plan to increase the branding activity at retail level.

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We plan to continue with our initiatives of new product launches in ice creams and processed foods.

What is the price range of your products? We ensure the all our products offer the best affordable price range. We offer our products with the best price ranges from Rs5 to Rs35.

What is your staff strength? Do youngsters find it exciting to join an ice-cream company? Our current employee strength is approximately 1000 including both divisions. The ice cream as well as processed food industry of India attracts the young breed of students as it has fresh scope of learning and offers exciting work opportunities.

What is your message to shareholders? The year 2011-12 has been a record year for Vadilal in many ways. We reported record financial results for the year, Company is growing at 23 % and the results of Q1 for 2012 -13 marked at 59.12% rise in profitability and we continue to believe that Vadilal is poised for taking advantage of market transitions in unique ways. At Vadilal leadership is dependent upon three major factors. First, vision of how the industry will evolve. Second, the strategy Vadilal will employ to gain leadership. And third, our effectiveness in taking initiatives and pioneering the epitome of innovation, uniqueness & technology with upholding the Quality of our products. We are proud of Vadilals consistency and transparency in financial reporting and execution in operations.

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Research Methodology

Research Methodology is the system of collecting data for research projects is known as research methodology. The data may be collected for either theoretical or practical research for example management research may be strategically conceptualized along with operational planning methods and change management. The data collected for this project is the Primary as well as Secondary data. Primary data is a type of information that is obtained directly from first-hand sources by means of surveys, observation or experimentation. It is data that has not been previously published and is derived from a new or original research study and collected at the source such as in marketing. A secondary data research project involves the gathering and/or use of existing data for purposes other than those for which they were originally collected. Secondary sources could include previous research reports, newspaper, magazine and journal content, and government and NGO statistics.

Advantages of Primary Data: Researcher can focus on both qualitative and quantitative issues. Addresses specific research issues as the researcher controls the search design to fit their needs. Great control; not only does primary research enable the marketer to focus on specific subjects; it also enables the researcher to have a higher control over how the information is collected. Taking this into account, the researcher can decide on such requirements as size of project, time frame and goal.

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Disadvantages of Primary Data: Primary data may be very expensive in preparing and carrying out the research. In order to be done properly, primary data collection requires the development and execution of a research plan. It takes longer to undertake primary research than to acquire secondary data. Some research projects, while potentially offering information that could prove quite valuable, may not be within the reach of a researcher. By the time the research is complete it may be out of date. Low response rate has to be expected.

Advantages of Secondary Data: It is economical. It saves efforts and expenses. It is time saving. It helps to make primary data collection more specific since with the help of secondary data, we are able to make out what are the gaps and deficiencies and what additional information needs to be collected. It helps to improve the understanding of the problem. It provides a basis for comparison for the data that is collected by the researcher.

Disadvantages of Secondary Data: Secondary data is something that seldom fits in the framework of the marketing research factors. Accuracy of secondary data is not known. Data may be outdated.

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Research Design:

Research Method:

Survey

Sample Size:

240 retail stores

Data Used:

Primary

Sampling Area:

All retail store selling ice cream in location such as Panvel (Old and New), Khanda Colony, Kamothe, Ghansoli, Rabale, Sanpada and Nerul.

Questionnaire Filled By:

Owners of Retail Stores

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Data Collection

The collection of primary data for the market research was through survey.

Survey: Survey methodology studies the sampling of individual units from a population and the associated survey data collection techniques, such as questionnaire construction and methods for improving the number and accuracy of responses to surveys. Survey methodology as a scientific field seeks to identify principles about the sample design, data collection instruments, statistical adjustment of data, and data processing, and final data analysis that can create systematic and random survey errors. Survey errors are sometimes analyzed in connection with survey cost. Cost constraints are sometimes framed as improving quality within cost constraints, or alternatively, reducing costs for a fixed level of quality. Survey methodology is both a scientific field and a profession, meaning that some professionals in the field focus on survey errors empirically and others design surveys to reduce them. For survey designers, the task involves making a large set of decisions about thousands of individual features of a survey in order to improve it.

Surveying Errors:

1. Sampling Error: Sampling error is essentially the degree to which a survey statistic differs from its true value due to the fact that the survey was conducted among only one of many possible survey samples. It is a degree of uncertainty that we are willing to live with. Even most non-researchers have a basic understanding, or at least awareness, of sampling error due to the medias reference to the margin of error when reporting public survey results.

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2. Measurement Error: Measurement error is the degree to which a survey statistic differs from its true value due to imperfections in the way the statistic is collected. The most common type of measurement error is one researchers deal with on a daily basis: poor question wording, with faulty assumptions and imperfect scales.

3. Coverage Error: Coverage error is another important source of variability in survey statistics; it is the degree to which statistics are off due to the fact that the sample used does not properly represent the underlying population being measured. There was generally more concern about coverage error in the past; these days, the combination of increasing internet penetration and fast/easy/cheap online survey panels has made it possible to accurately represent many target populations. Concern about coverage error is still an important conversation; however, it is being discussed more in academic and thought-leadership circles than by the average dayt0-day research practitioner.

4. Non-Response Error:

Telephone survey houses historically have routinely made 20 or more call-backs to households that do not answer the telephone. This practice has dwindled due to a combination of the expense of conducting so many call-backs, and the dramatic growth of online surveys, where it is just easier to replace non-responders with fresh sample. It is also not considered acceptable in an online context to conduct scores of follow-up emails; that would get the sender sent to blacklist post haste.

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Questionnaire

Name of Retail Store:__________________________________________________

Address: _____________________________________________________________

Contact person: ____________________________________________________________

Contact no: ___________________________________________

1. Do you sell Vadilal ice-cream? a) Yes b) No

2. If yes, are you satisfied with customer service given by Vadilal? a) Yes b) No

3. If no, what is area of improvement? Ans: ________________________________________________________________

4. What are the reasons you dont offer Vadilal Ice-cream? a) No salesman visit b) After sales service c) Packaging d) Product Quality e) Brand Loyalty f) Distributor problems g) No free Deep freezer

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5. If not Vadilal, which companys ice-cream do you offer? a) Amul e) Dinshaw b) Mother Dairy c) Kwality Walls d) Cream Bell f) Havmor g) Other

6. Are you satisfied with customer service given by that company? a) Yes b) No

7. If no, what are the problems that you face? Ans: ________________________________________________________________

8. Whose deep freezer do you keep? a) Company provided b) Own

9. What is your average weekly purchase of ice-cream? (in Rs.) a) 0-1000 b) 1000-5000 c) 5000-10000 d) 10000-15000

e) 15000-20000 f) 20000-25000 g) 25000-30000 h) 30000 and above

10. What payment option do you prefer? a) Bill to Bill (i.e. 7 days since weekly visits) b) Cash

11. Are you interested in buying Vadilal deep freezer with deposit scheme? a) Yes b) No

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Data Analysis

SWOT Analysis:

Strength: It has world class manufacturing facilities providing excellent quality Huge brand name in Gujarat providing a good base to expand in Navi Mumbai Has good reputation and experience for being in the industry for over 40 years Huge variety in flavors of ice creams and candies Weakness: Less visibility and market share across the region because of major players in the industry Stronger competition stifling its growth Brand visibility lower than other major players Poor packaging of some products. Existing distributers in Navi Mumbai region are not able to make the impact in the market. Customer Service as well as after sales service is in bad shape. Sales Representatives are not energetic and enthusiastic. Opportunity: Improve distribution network across Navi Mumbai and gain market share Venture into other dairy products so as to compete with other brands Threats: Threat from the existing competitors as well as local ice cream brands Most people are not really brand conscious, so loyalty might be an issue

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Segmentation, Targeting and Positioning

Segmentation: Ice-cream for Quality conscious kids and adults

Targeting: Kids and youth from the urban middle and upper middle class

Positioning: A purely vegetarian dessert

Unique Selling Preposition:

Purely vegetarian with many options for the customers

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Major Competitors:

1) Kwality Walls 2) Amul 3) Mother Dairy 4) Cream Bell 5) Dinshaws 6) Havmor

Local Competitors:

1) Pastonji 2) Aditya 3) Five Star 4) Vinod

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Analysis of Primary Data:

The data has been analyzed by using appropriate statistical techniques such as percentage, bar charts and column charts.

1. Do you sell Vadilal ice-cream?

60 50 40 30 20 10 0 4 7 5 Khanda Colony 30 21 20 0 Kamothe Yes 6 Airoli No 47 32 24 21 10 5 Koperkhaine 9 Turbhe 3 Seawood

Old Panvel New Panvel

Explanation: Out of the total surveyed retail stores i.e. 240 stores, only 34 retail stores sell Vadilal Ice-cream. There were one locations i.e. Kamothe where there is no Vadilal presence..

Inference: This tells us that the presence of Vadilal Ice-cream in surveyed location is very poor.

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2. If yes, are you satisfied with customer service given by Vadilal?

120 100 80 60 100 40 20 0 2.8 4.5 95 100 90 85 90 No 80 Yes 0 5 0

10

15

10

20

Explanation: According to above statistics, almost 80% of the retail stores out of the stores which sells Vadilal Ice-cream are satisfied with the customer service provided by Vadilal. Inference: This shows that the Vadilal is successful in satisfying the existing customers in the above surveyed locations.

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4. What are the reasons you dont offer Vadilal Ice-cream??

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% No free Deep Freezer Distributor Problem Brand Loyalty Packaging Product Quality After Sales Service No Salesman visit

Explanation: The above statistics shows the different locations have different reasons for not opting to sell Vadilal Ice-cream. The main two reasons are 1) No free deep freezer policy and 2) No salesman visits. The reason of after sales service also goes hand in hand with no salesman visit reason.

Inference: Vadilal has to rigorously work upon the deep freezer policy. Since it is an established brand, the retail owners expect Vadilal to offer free deep freezer.

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5. If not Vadilal, which companys ice-cream do you offer?

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Other Havmor Dinshaw CreamBell Kwality Walls Mother Dairy Amul

Explanation: Out of the total surveyed areas, the market share of Kwality Walls is much higher. In the second position is Amul. The remaining market share is occupied with Mother Dairy, Dinshaws, Cream Bell, Havmor and then other local brands.

Inference: The above statistics shows that Vadilals strongest competitor in Navi Mumbai region is Kwality Walls.

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6. Are you satisfied with customer service given by that company?

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 88.3 85.2 76.2 11.7 14.8 23.8

0 25 23 14.2 28.1

100 75 100 85.8 71.9 No Yes

Explanation: There is high level of satisfaction to the retail owners given by competitors icecream company. Owners said that we face no problem with the customer services provided by the company and mostly their after sales service is something that is keeping them from switching brands.

Inference: The high level of satisfaction showed by retail owners towards the competitors company makes Vadilals competition tough and even difficult to influence them to switch brands.

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8. Whose deep freezer do you keep?

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%

8.8

5 17.6 26.9

9.6

4.1 20 17

91.2

95 82.4 73.1

90.4

95.9 80 83 Own Company Provided

Explanation: From all the retail stores that were surveyed, more than 70% retail store use the company provided deep freezer rather than their own purchased.

Inference: The above statistics shows us that they prefer that the company should provide them deep freezer than that of their own.

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9. What is your average weekly purchase of ice-cream?

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 25000 and above 20000-25000 15000-20000 10000-15000 5000-10000 1000-5000 0-1000

Explanation: The above graph implies that the majority of retail store owners purchase icecream mostly in the range of Rs.1000-5000 and second most range is Rs.5000-10000.

Inference: This data will help Vadilal to make strategies regarding the payment options given to the retail owners. It will help them to make decision whether or not to give credit options to the retailers.

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10. What payment option do you prefer?

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 33 72 53 41 35 13 16 72 Credit (Bil to Bill) Cash 67 28 47 59 100 87 84 28

Explanation: In the locations such as Old Panvel and New Panvel, the retail stores prefer Cash payment over Credit (Bill to Bill). Since the population in these areas is more of upper middle class people they choose cash option. Whereas in other locations, retail owners prefer credit (bill to bill) option over cash

Inference: The above statistics shows that retail owners prefer credit system (bill to bill) over instant cash option.

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11. Are you interested in buying Vadilal deep freezer with deposit scheme?

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 47.1 76.4 53.8 35 33.4 41.4 25 70 No Yes 52.9 23.6 46.2 65 66.6 58.6 75 30

Explanation: There are only three locations out of eight wherein the more than 50% retail stores are interested in buying Vadilal deep freezer with deposit scheme. The interest in other six locations varies between 20% - 40%.

Inference: The location such as Old Panvel and Rabale has higher demand, locations such as New Panvel, Khanda Colony has moderate demand whereas in locations like Kamothe, Thurbhe and Seawoods the demand is low

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Findings

From the data analysis of the primary data that I have collected, following points I have find out about Vadilal Ice-cream is:

1) Out of the total surveyed retail stores i.e. 240 stores, only 34 retail stores sell Vadilal Ice-cream. There were two locations i.e. Kamothe and Turbhe where there is no Vadilal presence. The presence of Vadilal Ice-cream in surveyed location is very poor. 2) Almost 80% of the retail stores out of the stores which sells Vadilal Ice-cream are satisfied with the customer service provided by Vadilal. In Turbhe, there are no sellers of Vadilal Ice-cream. 3) Vadilal is successful in satisfying the existing customers in the above surveyed locations. 4) The different locations that were have different reasons for not opting to sell Vadilal Ice-cream. The main two reasons are a) No free deep freezer policy and b) No salesman visits. 5) Out of the total surveyed areas, the market share of Kwality Walls is much higher. In the second position is Amul. Vadilals strongest competitor in Navi Mumbai region is Kwality Walls. 6) There is high level of satisfaction to the retail owners given by competitors icecream company. 7) More than 70% retail store use the company provided deep freezer rather than own purchased. 8) The majority of retail store owners purchase ice-cream mostly in the range of Rs.1000-5000 and second most range is Rs.5000-10000. 9) In the locations such as Old Panvel and New Panvel, the retail stores prefer Cash payment over Credit (Bill to Bill). Whereas in other locations, retail owners prefer credit (bill to bill) option over cash.

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10) There are only three locations out of eight wherein the more than 50% retail stores are interested in buying Vadilal deep freezer with deposit scheme. The interest in other six locations varies between 20% - 40%.

Recommendation/ Suggestions

From the analysis and observation during my internship period, recommendations I would like to present, they are;

following

1) Firstly, I would like to suggest is that Vadilal should come up with free deep freezer policy. The analysis shows that retail owners are not satisfied with the existing policy. They find it more expensive than what other competitors are offering. Retail owners commented that You give us free deep freezer; we will help you increase your sales. Since Kwality Walls is offering free deep freezers, they have gain major market share and is the strongest competitor in Navi Mumbai. If Vadilal has to take them out, they have to consider this option. Atleast, they will give tough competition rather than being not in it.

2) The sales representatives of Vadilal are not motivated and enthusiastic enough to bring out their full potential. They stick with their route and do not explore new retail stores. So, I would like to suggest motivating them with regular incentives and even then if not, try hiring educated, young employees that will find creative ways to influence and make potential buyers into actual customers.

3) Vadilal is not so popular in Vadilal in Navi Mumbai region. So I would suggest having some promotional campaigns only for Navi Mumbai people. Since Navi Mumbai has lots of schools, colleges, educational institutions around, it have become an educational hub. Also, Vadilal targets the youth population for its icecream. So sponsoring events in the schools and colleges will help them to create awareness and will have wider reach to the hearts of the customer.

4) There is no single FOW (Fridge on Wheels) and Happinezz parlor here in Navi Mumbai. There is only one Vadilals ice-cream franchised parlour in Seawoods,
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Navi Mumbai. The tagline of Vadilal ice-cream is Happinezz ka Swaad, so how come the customers will Swaad the Happinezz if there is no parlour? So I will suggest to atleast open one Happinezz parlour.

5) Nowadays, social media is on the high, so make full use of these social networking sites to reach out to the customers and try to take feedbacks, reviews of the products and try to find out the area of improvements. Even try to indulge in some CSR activities by getting affiliated to the fight against social causes in Navi Mumbai. Navi Mumbai has a less polluted and clean environment. Trying to do such activities in Navi Mumbai will definitely get a good response because people here are more educated and self aware of social problems.

6) Many companies have developed mobile application in which we only have to select products and their quantity just by clicking on it. If Vadilal can have this kind of application, the time for taking orders will be reduced and the sales representative can cover many retail stores in a day. Also, it will be fun to operate on mobile phones rather than writing it in a dairy which we have to carry every day.

7) It is common saying that Don't Judge a Book by Its Cover. But when it comes to products, it is always judged by its packaging. So Vadilal has to change packaging of that product which is packed in paper. Vadilal Cup products has paper lid which always comes off, which damages the product. This brings damage replacement in question. So if there is no paper packaging to the products, then there will be no damage and no question of replacement thereof. 8) During survey, there were complaints that the retail owner has placed an order but the delivery of product did not happen. And from onwards, the retail owner stopped buying Vadilals product. So here Vadilal has to take care of the most important thing i.e. Customer Service. Right from timely delivery of products till the after sales services provided by the company.

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Conclusion

1) According to the market research analysis, firstly, we can conclude that the presence of Vadilal in the Navi Mumbai region is very poor. And that if Vadilal choose to improve its sales, then, they have to make aggressive marketing and promotional strategies that will make the presence of Vadilal Ice-cream feel in the hearts of many consumers. 2) Second conclusion is that the reasons for low sales of Vadilal Ice-creams in Navi Mumbai region are poor customer service, irregular salesman visits, no deep freezer policy, bad retail-distributor relationship, packaging, brand loyalty. In Navi Mumbai, Kwality Walls is the market leader, and therefore introducing free deep freezer into the market by Vadilal will definitely shake the competitors and force them to build new marketing strategies.

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Bibliography

http://researchaccess.com/2011/11/4-kinds-of-survey-error-samplingmeasurement-coverage-nonresponse/ http://articles.economictimes.indiatimes.com/2013-0307/news/37532173_1_gelato-ice-cream-vadilal-industries http://www.indiainfoline.com/Research/LeaderSpeak/Mr.-Rajesh-R.-GandhiManaging-Director-Vadilal-Industries-Ltd./36769656 www.google.com www.scribd.com www.wikipedia.com www.motherdairy.com www.vadilal.com www.economictimes.com

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