GCMMF- GOING BEYOND AMUL

By Group 6 Vignesh Aditya Nevin Shyam Saravanan

FOOD PROCESSING INDUSTRY

Total size of food-processing industry is around US $40 billion growing at 10%.

The industry is mainly unorganized with 42% of the processing units belonging to that category, the organised category though small, is growing fast.
With rapid increase in the per capita income and purchasing power along with increased urbanization, improved standards of living, there lies a large untapped opportunity to cater to 1000 million domestic consumers. It is estimated that 300 million upper and middle class consume processed food. Due to these facts, The food-processing industry has been identified as a focus area for development and has been included in the prioritylending sector.

Food Processing Sector in India

Rupee Spending

16%

33%

25%
Organized 25% Unorganized 42%
5%
6% 7% 9% 57%

Food & Grocery Savings & Invst. Consumer Durables Eating Out Clothing

SSI 33%

42%

Segments in Food Processing Industry

40.0% 35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% Fruits & Vegetables Milk & Dairy Meat Poultry products 2.2% 6.0% 21.0% 35.0%

FACTORS FOSTERING THE GROWTH OF FOOD PROCESSING INDUSTRY

Rapid transformation in the lifestyle of Indians, particularly urban India Growth in working women's population

Prevalence of nuclear families with double income

Increase in overseas travel and the presence of foreign media

These trends have largely impacted the Indian foodprocessing sector, as there was a jump in the demand for processed, ready-to-eat and ready-to-cook food.

CASE FACTS
GCMMF Real ice cream masti dhai taaza

SNOWCAP

MARKETING MIX
PRODUCTS DAIRY PRODUCTS READY TO EAT PRODUCTS PLACE RURAL AND URBAN MARKET INTERNATIONAL MARKET PRICE LOW PRICING STRATEGY PROMOTION PRINT MEDIA ADVERTISEMENT

BCG MATRIX
High Low

Market growth

Amul Butter Amul Taaza Amul Dairy Whitner

Amul masti dahi Amul mithai mate

High

Amul ice cream Amul mozzarella pizza cheese

Jaldhara
Low

Market share

QUESTION 1

Why do you think GCMMF was diversifying into pizzas, cheeseburgers, tomato sauce, ketchup and other eatables?

Possible Reasons Lifestyle changes

To increase the usage of cheese and other milk products Other Reasons: According to some analysts, this diversification was probably not entirely demanddriven. Being a cooperative, GCMMF was compelled to buy all the milk that was produced in Gujarat.

Plan Low Price Range Pizza, Cheeseburgers Technical Training by GCMMF to maintain quality Get vegetables at cheaper prices from suppliers by negotiation

QUESTION 2

Why GCMMF used the brand SnowCap for pizzas and not Amul?

Amul - 100% milk products brand PizzaSnowcap positioned against low priced regional players Snow Cap already has dedicated distribution network and retail stores Umbrella Branding strategy is not always successful because the stakes are high when you are using a successful brand name to promote a new product in the market. And once such a condition comes the mother brand suffers a lot because of the new product failure.

QUESTION 3

What kind of pricing startegy has GCMMF adopted to sell pizzas under the brand name of Snowcap? Is it the right approach?

GCMMF adopted penetration pricing strategy.

Amul's products were priced comparatively less than those of its competitors. Amul could price its products low because of the economies of scale it enjoyed