INTRODUCTION BISCUIT INDUSTRY IN INDIA Biscuit industry in India in the organized sector produces around 60% of the total

production, the balance 40% being contributed by the unorganized bakeries. Theindustry consists of two large scale man ufacturers, around 50 medium scale brands and small scale units ranging up to 2500 units in the country, as at 2000-01. The unorganized sector is estimated to have approximately 30,000 small &tiny bakeries across the country.The annual turnover of the organized sector of the biscuit manufacturers (as at200708) is Rs. 4,350 crores.In terms of volume biscuit production by the organized segment in 200708 isestimated at 1.30 million tonnes. The

major Brands of biscuits are - Britannia,Parle Bakeman, Parle G, Elite, Cremica, Dukes, Anupam, Craze, Nezone, besides various regional/State brands.Biscuit industry which was till then reserved in the SSI (Small Scale Industry)Sector, was unreserved in 1997-98, in accordance with the Govt Policy, based onthe recommendations of the Abid Hussain Committee.T h e a n n u a l p r o d u c t i o n o f b i s c u i t in the organized sector, continues to b e predominantly in the small and mediu m sale sector before and after dereservation. The annual production was around 7.4 Lakh tonnes in 1997-98 In thenext five years, biscuit production witnessed an annual growth of 10% to 12%, upto 1999-00.The annual Growth showed a decline of 3.5% in 2000-01, mainly due to 100%hike in Central Excise Duty (from

9% to 16%). Production in the year 200102increased very marginally by 2.75% where in 2002-03 the growth is around 3%.6

The Union Budget for 2005-06 granted 50% reduction in the rate of Excise Dutyon Biscuit i.e. from 16% to 8%. The Federation's estimate for the current year indicates a growth of approximately 8% to 9%.However the average utilization of installed capacity by biscuit manufacturers inthe country has been a dismal 60% over the last decade up to 2006-07.Though dereservation resulted in a few MNCs, i.e. Sara Lee, Kellogs SmithKlineBeecham, Heinz etc entering the biscuit industry in India, most of them, with theexception of SmithKline Beecham (Horlicks Biscuits), have ceased production inthe country.On the other hand, import of biscuits, specially in

the high price segment hass t a r t e d f r o m 2 0 0 0 01, but however, the quantum of imports h a s n o t s o f a r increased alarmingly and has remained at around 3.75% of the consumption of biscuits in the country in the year 200102. However, recent imports from chinaindustries cheaper verities of bisc uit, needs to be examined with cautions,esp ecially in the context of the price as the low margin based domestic industry,which is operating at 60 % of the total installed capital. Exports of biscuits fromIndia has been to the extent of 5.5% of the total production. Export are expectedto grow only in the year 2006-07 and beyond.B i s c u i t i s a h y g i e n i c a l l y p a c k a g e d nutritious snack food available at veryc o

mpetitive prices, volumes and differ e n t t a s t e s . A c c o r d i n g t o t h e NCAER(N ational Council Of Applied Economic Resear ch) Study, biscuit is predominantly consumed by people from the lower strata of society, particularlyc h i l d r e n i n b o t h r u r a l a n d u r b a n areas with an average monthly income o f Rs. 750.00.Biscuit can he broadly categorized into the following segments:(Based on productions of 2007-08)GlucoseMarieCreamCrackers

INDUSTRY PROFILE The word 'Biscuit' is derived from the Latin words 'Bis' (meaning 'twice') and'Coctus' (meaning cooked or baked). The word 'Biscotti' is also the generic termfor cookies in Italian. Back then, biscuits were unleavened, hard and thin waferswhich, because of their low water content, were ideal food to store.As people started to explore the globe, biscuits became the ideal travelling foodsince they stayed fresh for long periods. The seafaring age, thus, witnessed the boom of biscuits when these were sealed in airtight containers to last for monthsat a

time. Hard track biscuits (earliest version of the biscotti and present-daycrackers) were part of the staple diet of English and American sailors for manycenturies. In fact, the countries which led this seafaring charge, such as those inWestern Europe, are the ones where biscuits are most popular even today. Biscottii s s a i d t o h a v e b e e n a f a v o u r i t e o f C h r i s t o p h e r C o l u m b u s w h o d i s c o v e r e d Am erica!Making good biscuits is quite an art, and history bears testimony to that. Duringt h e 1 7 t h a n d 1 8 t h C e n t u r i e s i n E u r o p e , b a k i n g w a s a c a r e f u l l y c o n t r o l l e d pr ofession, managed through a series of 'guilds' or professional associations. To become a baker, one had to complete years of apprenticeship - working throughthe ranks of apprentice, journeyman, and finally master

baker. Not only this, theamount and quality of biscuits baked were also carefully monitored.The English, Scotch and Dutch immigrants originally brought the first cookies tothe United States and they were called teacakes. They were often flavoured withnothing more than the finest butter, sometimes with the addition of a few drops of rose water. Cookies in America were also called by such names as "jumbles","plunkets" and "cry babies".

qqCOMPANY PROFILE A long time ago, when the British ruled India, a small factory was set up in thesuburbs of of Mumbai city, to manufacture sweets and toffees. The year was 1929 andthe market was dominated by famous international brands that were imported freely.Despite the odds and u nequal competition, this company called Pa rle Products,survived and succeeded, by

adhering to high quality and improvising from time totime.A decade later, in 1959, Parle Products began manufacturing biscuits, in addition tosweets and toffees. Having already established a reputation for quality, the Parle brandname grew in strength with this diversification. Parle Glucose and Parle Monaco werethe first brands of biscuits to be introduced, which later went on to become leadingnames for great taste and quality. How Parle fought to make biscuits affordable to all. Biscuits were very much a luxury food in India, when Parle began production in 1959.Apart from Glucose and Monaco biscuits, Parle did offer a wide variety of brands.However, during the Second World War, all domestic biscuit production was divertedto assist the Indian soldiers in India and

the Far East. Apart from this, the shortage of wheat in those days, made Parle decide to concentrate on the more popular brands, sothat people could enjoy the price benefits.Thankfully today, there's no dearth of ingredients and the demand for more premium b r a n d s i s on the rise. That's why, we now have a w i d e r a n g e o f b i s c u i t s a n d mouthwatering confectionaries to offer.11

The strength of the Parle Brand Over the years, Parle has grown to become a multi-million US Dollar company. Manyof the Parle products - biscuits or confectionaries, are market leaders in their categoryand have won acclaim at the Monde Selection, since 1971.Today, Parle enjoys a 40% share of the total biscuit market and a 15% share of

thetotal confectionary market, in India. The Parle Biscuit brands, such as, ParleG,M o n a c o a n d K r a c k j a c k a n d c o n f e c t i o n e r y b r a n d s , s u c h a s , M e l o d y , P o p p i n s , Mang obite and Kismi, enjoy a strong imagery and appeal amongst consumers.Be it a big city or a remote village of India, the Parle name symbolizes quality, healthand great taste! And yet, we know that this reputation has been built, by constantlyinnovating and catering to new tastes. This can be seen by the success of new brands,such as, Hide & Seek, or the single twist wrapping of Mango bite.In this way, by concentrating on consumer tastes and preferences and emphasizingResearch & Development, the Parle brand grows from strength to strength. The Quality Commitment

Parle Products has one factory at M umbai that manufactures biscuits &c onfectioneries while another factory at Bah adurgarh, in Haryana manufactures biscuits. Apart from this, Parle has manufacturing facilities at Neemrana, in Rajasthanand at Bangalore in Karnataka. The factories at Bahadurgarh and Neemrana are thelargest such manufacturing facilites in India. Parle Products also has 14 manufacturingunits for biscuits & 5 manufacturing units for confectioneries, on contract.All these factories are located at strategic locations, so as to ensure a constant output& easy distribution. Each factory has state-of-theart machinery with automatic printing & packaging facilities.All Parle products are manufactured under the most hygienic conditions.

Great care isexercised in the selection & quality control of raw materials, packaging materials &rigid quality standards are ensured at every stage of the manufacturing process.12

The Marketing Strength The extensive distribution network, built over the years, is a major strength for ParleProducts. Parle biscuits & sweets are available to consumers, even in the most remote places and in the smallest of villages with a population of just 500.Parle has nearly 1,500 wholesalers, cater ing to 4,25,000 retail outlets directly or indi rectly. A two hundred strong dedicated field force services these wholesalers &retailers. Additionally, there are 31 depots and C&F agents supplying goods to thewide distribution network.The Parle marketing philosophy

emphasizes catering to the masses. We constantlyendeavour at designing products that provide nutrition & fun to the common man.Most Parle offerings are in the low & midrange price segments. This is based on our cultivated understanding of the Indian c onsumer psyche. The value-formoney positioning helps generate large sales volumes for the products.However, Parle Products also manufactures a variety of premium products for the up-market, urban consumers. And in this way, caters a range of products to a variety of consumers. The Customer Confidence The Parle name conjures up fond memories across the length and breadth of thecountry. After all, since 1959, the people of India have been growing up on

Parle biscuits & sweets.Today, the Parle brands have found their way into the hearts and homes of people allover India & abroad. Parle Biscuits and confectioneries, continue to spread happiness& joy among people of all ages.The consumer is the focus of all activities at Parle. Maximizing value to consumersand forging enduring customer relationships are the core endeavours at Parle.

cream content in its category. Available in a variety of mouthwatering, lipsmackingflavours like chocolate, butterscotch, strawberry and milk cream, these irresistiblecream biscuits whet your appetite for more, and also make for a perfect dessert. NutriChoice SugarOut

This is because NutriChoice SugarOut is sweetened with "Sucralose," derived fromsugar, which provides the same sweetness as any other biscuit, without the addedcalories of sugar.This range is available in 3 delicious variants namely Litetime, Chocolate cream, andOrange cream, targeted towards all health sensitive people. It is also relevant for consumers with sugar related ailments.We are sure that you will be pleasantly delighted with its great taste and equallysurprised to know that it has no added sugar.Don't be taken for a ride when you read "Sugar Free" label on many biscuit packsmarketed in India or abroad. Even with 100% no-added sugar, wheatcereals in biscuits have their own natural sugar content. Parle Ghas chosen to represent these biscuits with "No Added Sugar" claim, as

there is no added sugar in the processing of NutriChoice SugarOut. Nutri Choice Digestive Biscuit Nothing can be more difficult than making small efforts in our daily life towardshealthy and active living. 24/7 we are engrossed in our busy schedules; skippingmeals, missing walks, along with inadequate sleep and frequently eating-out, alltake a heavy toll on our health.At least with the new and improved NutriChoice Digestive Biscuit, we have oneless thing to worry about. Made with 50% whole-wheat and packed with addedfibre (10% of our daily dietary needs), these delightfully tasty biscuits areamongst your healthiest bites of the day.In your next visit to a shop just look out for its Golden-green international carton pack.Try one and you'll know

that you've made one smart choice NutriChoice.23

Treat Fruit Rollz So go on and treat yourself to the lip-smacking snack!New Parle-G Milk Bikis Milk Bikis, the favorite growth partner of Kids, now brings greater value anddelight to all with its new product and pack design. Recently relaunched in itsexisting Southern & Eastern markets, and extended across India, the new Milk Bikis is all set to add excitement and appeal to nutritious food. Whoever saidthat good food needs to look dull and boring, will just have to take a look atMilk Bikis.W i t h a u n i q u e a n d a t t r a c t i v e h o n e y c o m b d e s i g n a n d a n e n h a n c e d p r o d u c t exp erience, the new biscuit prompts the Kids

will love it reaction amongstm o t h e r s . T h e m i l k g o o d n e s s i n t h e r e c i p e i s n o w e n h a n c e d w i t h S M A R T 24

NUTRIENTS 4 vital vitamins, iron and iodine, proven to aid mental and p h y s i c a l d e v e l o p m e n t i n g r o w ing kids. The premium packaging, beside s appealing to kids, also ensures that the biscuits remain fresh and crisp.So, whether its breakfast time or snack time at school, rest assured that kids willlook forward to munching these crunchy, milky biscuits which even helps in their development. And yes, adults wont be far behind in reaching out for a pack! Parle-G 50-50 Pepper Chakkar

The launch of the latest 50-50 variant left everybody guessing "What it is?" FromTV ads, radio, outdoor and in-store display materials to events, a website andSMS and email blasts, traditional and new media were blended synergistically tocreate excitement and curiosity about the unique taste of the biscuit. The tangyand distinctive pepper flavoured biscuit, that's thin and crispy and more like asnack, caught the imagination of a younger audience craving something to nibbleon. The 50-50 Pepper Chakkar launch is truly a case of leveraging the marketingmix to best advantage.Parle-G profits up 125 % in Q2; growth momentum continuesMumbai, October 23rd, 2007: Parle-G Industries Ltd. (PARLE G ), one of Indiasleading

food Companies, reported sales of Rs. 6,588 MM for the quarter ended30th September 2008, reflecting 20% growth over the corresponding quarter lastyear. Net Profit for the quarter at Rs. 485 MM was more than double for thecorresponding quarter last year of Rs 212 MM.For the half year ended 30th September 07, revenue grew 19.6% to Rs. 12,356MM, while net profit at Rs 846 MM was 64.6% higher than last year.Commenting on the performance, Ms. Vinita Bali, Managing Director, said,We continue to build on the growth momentum of last year. We have added 340 basis points to our margin through higher price realization as well as innovation.The increase in profit has been achieved despite the continuing and

unprecedentedincrease in prices of key commodities like flour, oils & dairy products.During the quarter, the Company launched Treat Choco Gelo, an extension of t h e T r e a t f r a n c h i s e w i t h d o u b l e m a s t i of chocolate & caramel and also introduced a range of premium indulgence cookies under Pure Magic brand. Investment in Advertising and Sales Promotion has been increased by 50% to fuelthe innovation led growth. PROMOTION IN RURAL MARKET MERA RPD MAHAN CONTEST Mera RPD (Radiation Protection Dosimetr y ) M a h a n c o n t e s t w a s a d e a l e r incentive contest which was designed for the dealers of

the Rural market. Thiscontest was designed to motivate the RPDs (Radiation Protection Dosimetry) andUPDs (Urban preferred Dealers) to reach their Sales target of 35,000 and 50,000respectively. This contest was held in the month of May and June.The details of this contest are as follows: Period May- Jun'06 Scope RPDs (Radiation Protection Dosimetry) in all SURE Territories Criteria Sales target achievement for the incentive periodTargets for the period to be set by the SO/ ASM inconsultation with the RSM Minimum swing of 40% inMay and June'06 MA sales over JanMar'06 MA sales To qualify the RPD must have

minimum current salesof Rs.30000 PM or the Target sales should be aminimum of Rs.30000 PM. Mechanics 1 Top RPD to be selected as the "Mera RPD (Radiation Protection Dosimetry)Mahaan" per RPD PSM PJP. This RPD to get a gift article worth Rs. 3000/(Nokia MoParle G e PhoneProposed All other RPDs to get a gift article worth Rs. 500/or cash if preferred38

WEAKNESSES

 The Company takes a lot of time in handling the UCA (Supply Chain Company)claims of the authorized wholesalers; this !eads to demotivation Warehousing norms are not followed, which accounts for high breakage The semi-sweet category accounts for the maximum turnover in the mass market-the Tiger Anytime being a member of this category is perceived as a tow quality product; this may liquidate Parle G 's brand equity in the mass market Parle G has positioned it's Tiger range on health and taste, but my findings showthat health consciousness in the mass market is low, which

means that the brand isunderpositioned, since the market doesn't consid er "health1 as an important benefit in biscuits Parle G 's strength is in mid, premium mid superpremium category; this market isapproaching a saturation point Parle G 's mass market is not segmented properly; Parle G cannot afford to go allout in the mass market, the best strategy wo uld be to concentrate on thesesegments of the mass market, which will account for volume sales and requireminimum investment Performance-based incentive to motivate the sates staff is not existing in the Company

Yearly incentives don't motivate the dealers of mass market brands OPPORTUNITIES Mass market is growing with established preference for biscuits Growing middle class in India can provide more opportunities for Parle G 's pillar brands Credit given to dealers will help Parle G in expanding the width of reach, bywhich the company will have a volume advantage39

Taste plays an important role in mass market which can take care of p r i c e sensitivity to some extent

 There is low differentiation in the mass market brands There is a fairly good market for a high count salty cracker variety and a creamcracker variety in the mass market THREATS De-reservation of the biscuit industry may attract foreign players who initiallywill try to attack the premium segment, which is already established for Parle G A characteristic feature of premium market consumer is that this segment is not brand

loyal; therefore there is a chance of the consumers to shift to other brands inthe near/distant future Too much concentration in the mass market may affect the companies market inthis established segment Mass-market venture may account for this cannibalization A large number of competitors each having respective bold in different markets of the company's pillar brands will account for high contribution/orrir

RESEARCH METHODOLOGY OBJECTIVE OF THE STUDY

PRIME OBJECTIVE To find out the competitive activity and merchandising through retailer of PARLE GBUISCUIT in south Delhi. OTHER OBJECTIVE To find out the consumer preference according to retailer view. To find out the satisfaction levels towards service provide by PARLE G. To find out the major competitor of PARLE G BISCUIT . SCOPE OF THE STUDY

FMCG Sector is a growing sector in India at high pace. Bi scuit manufacturingindustries has lot of scope in the Indian economy. Company manufactures according tot h e c o n s u m e r s i n t e r e s t . T h e r e i s a h i g h c o m p e t i t i o n i n b i s c u i t m a n u f a c t u r i n g in dustrys such as Parle -G, Sunfeast, Priya gold, etc. consumer prefers to take that product which not only satisfy him but also his colleagues, family, natives. This studyhelps in determining right choice for them.41

DATA COLLECTION METHOD Data collection is an elaborate process in w hich the researchers make a plannedresearc

h for all relevant data. Data is the foundation of all market research. Data arefacts may be obtained from several sources. Data can be classified as: Primary data Secondary data PRIMARY DATA It is gathered for the first time by the researchers. If the secondary data is found to beinadequate or unavailable, the researcher goes for primary data. COLLECTION OF PRIMARY DATA The researcher was assigned to do a comparative study on PARLE G BISCUIT . Inorder to accomplish the job, the researcher adopted the two-way strategy to collect

the primary data.Secondly to complete the job in a more genuine way, retailer survey was conductedsample of 30 rational retailers were taken and they were supplied with a structurednon-disguised questionnaire. The idea was to seek out the market position of PARLEG BISCUIT. The data collected was collected from different retail outlets of biscuit namely: Shops Confectioners Kirana and general stores42

SECONDARY DATA

Secondary data is the data borrowed from s econdary sources by the researcher.Second ary data can be internal or external i.e, internal records of the company or information available from library and other statistical organization.In a Market Research Project Field Work has a very vital role to play. As a matter of fact, its the back bone of any Market Research Project. Field work basically consistsof collection of primary data. In this project, researcher had to undergo a lot of FieldWork. For the purpose researcher has a visit various cinema halls, public attractive places, colleges & school canteens etc.The whole area which was to be surveyed was divided into different segmentsrandomly. Simultaneously survey of both retailers and consumers was carried out.

Theresearcher worked in the field for a span of one & half months. CONCLUSION & RECOMMENDATIONS Sales Promotional Offers helps the company to increase the over sales of the product under promotion because consumers tend to buy in ample amount due tosmall duration of the promotion and feel value for their money. But through these promotional schemes company earns less margin. It also helps in widening their consumer base i.e. it attracts new triers. It creates the brand awareness among the consumers about the newly launched product like Tiger cream.

Products which are less popular among the consumers like Pepper Checker arealso get Promoted. It helps to increase the repurchase rate of the occasional buyers Since the promotions were designed for r u r a l m a r k e t a n d r u r a l m a r k e t contributes to 70% of the total market hence attracting more consumers. And turnthem to loyal users It enhances brand image Since attractive promotion attracts consumers hence retailers push productsunder promotion rather than competitors products of same kind.

Sales promotion also attracts brand switchers who are primarily looking for low price good value of premiums

Learnings through Trade Promotions:

to persuade the RPDs and UPDs to carry the brand because they are moreconcentrated in making sales of the given company product so as to getmaximum incentives. to persuade the RPDs and UPDs to carry more units than the normalamount as they have to reach the target sale under Mera RPD Mahaan Scheme.

to induce RPDs and UPDs to promote the brand by featuring, display, and price reductions so as to attract more consumers. to stimulate RPDs and UPDs and their sales clerks to push the product thancompetitors products otherwise they wont be able to reach their sales target. Also Attract more RPDs and UPDs to take participate in the contest becauseof the incentives. Problems Stock out: It was observed that most of the Promotional SKUs (Stock Keeping Unit) wereout of stock at most of the depots during the Promotional Period which haseffected the total sales of these SKUs in these four regions tremendously.

Non availaParle G ity of Freebies: It was observed that sometime during the Promotional Period the Freebieswhich has to be given with the main Product were not available. Due to their unavailaParle G ity the Promotion for that Particular SKU (Stock KeepingUnit) was not carried for that Period of Promotion. Allocation Problem: The allocation was the most prominent problem during this Promotion. Thestocks were not allocated in the Rural and Urban markets according to their Percentage area contribution. In some areas the stock was supplied more

whichwas not in accordance with the Percentage area contribution of that regionwhile in some very less stock was supplied as compared to their Percentage58

area contribution. Due to this most of the time major part of the stock was dispatched in the Urban markets which has seriously affected the Rural sales. Dispatch Problem: There was no proper schedule for dispatching & receiving of orders generated.Generally the Stocks are Dispatched late by about a week from the depots dueto which the stock reaches late to the wholesalers and during that week thewholesalers face the problem of non

availability and are left with very less or no stock to sell. Poor sale promotion skills: According to observations, sale was not promoted skillfully in most of theRegions. The retailers in these regions have not taken appropriate efforts so asto promote the promotional products skillful Recommendations As already discussed above, there are certain issues and flaws associated withSales Promotion, so in order to implement it effectively and efficiently we wouldlike to suggest certain recommendations to the company:Production department should make efforts to make available all of the productv a r i e t i e s i n t h e depot norm wise. So that each and every

v a r i e t y s h o u l d b e available according to the generated order so as to meet the stock out problem.I recommend strong coordination between production and the sales department.So that a proper production forecast for each variety can be maintained by the production department. Proper allocation of the stock from the depot according to the Superstockistscontribution so that neither there is excess stock in one region nor stock outs inother.I also recommend to increase average number of lines so that all the SKUs (Stock Keeping Unit) are available in the market.Apart from setting overall target for all the SKUs (Stock Keeping Unit), thereshould also be individual SKU wise target so that RPDs and UPDs are able tomake sales of unfamiliar products also.To increase the sales

margin the price value of the main brand should be relativelyhigher i.e. around thrice of the Freebie for example instead of Rs10 pack of 50:50150G Freebie Pepper Checker should be given with Rs15 pack of 50:50.There should be a system from where different distributors can see the stock position of company and as well of other distributors. It will help the distributor ina way that if some distributors who wants the same.Contests like MERA RPD MAHAAN should be held every quarter.60

CHAPTER 6 BIBLIOGRAPHY Effective Planning in Marketing and D evelopment Leslie RaeW d r k C e l t a i s n s g o K r M a l a

y a i e l c e

e r n B l k

T e P l

h t r a

o i a c

r n c k

n g t w

e i e

M c

H u m a n

R e s o u r C R

M a n a g e m e n t

. B . G u p t a H u m a n e s o u r c e e n t H a r u C l n a m a J p o T . N . C h a b r a a i n t u

M a n a g e m

Recommendations As already discussed above, there are certain issues and flaws associated withSales Promotion, so in order to implement it effectively

and efficiently we wouldlike to suggest certain recommendations to the company:Production department should make efforts to make available all of the productv a r i e t i e s i n t h e depot norm wise. So that each and every v a r i e t y s h o u l d b e available according to the generated order so as to meet the stock out problem.I recommend strong coordination between production and the sales department.So that a proper production forecast for each variety can be maintained by the production department.Proper allocation of the stock from the depot according to the Superstockistscontribution so that neither there is excess stock in one region nor stock outs inother.I also recommend to increase average number of lines so that all the SKUs (Stock Keeping Unit) are available in

the market.Apart from setting overall target for all the SKUs (Stock Keeping Unit), thereshould also be individual SKU wise target so that RPDs and UPDs are able tomake sales of unfamiliar products also.To increase the sales margin the price value of the main brand should be relativelyhigher i.e. around thrice of the Freebie for example instead of Rs10 pack of 50:50150G Freebie Pepper Checker should be given with Rs15 pack of 50:50.There should be a system from where different distributors can see the stock position of company and as well of other distributors. It will help the distributor ina way that if some distributors who wants the same.Contests like MERA RPD MAHAAN should be held every quarter.60

CHAPTER 6

BIBLIOGRAPHY