NACCO

CASE RECOMMENDATION
Group 3
14F150
14F152
14F317
14F319
14F328

Is NACCO doing well?

Market share in jam market

HUL
Mapro

Year

201
0

2011

2012

Revenue for
jam

605

590.8

572.25

Percentage
change

Total revenue

2.48%
decrease

3%
decrease

172
1698
1738.75
1
Consumer Perception- Below Average for major
Percentage
1.33%
2.39%
contributor- JAM
change
decrease
increase
Package Design, Sweetness & Flavour

Marico's Sil
NACCO

Druk
Others

Mala

11%
2%
4%
5%
5%
14%

Recently competition is going to increase as a Denmark-based Food Group is

planning to enter India by bringing in 100 percent sugar-free product

60%

Break-even analysis- JAM

Cost Heads

Value: 2012

Fixed Cost

16.17

Material

19.94

Bottle

6.47

Label

1.08

Excise and VAT

4.31

Profit Margin

5.93

Ex-factory price

53.9

Break-even point

61227
Sales = 54500

The company has not met its breakeven as of now but numerator will
reduce if all pack sizes are considered

Product
Observations
Features
Richness of
fruit
Package
design
Color
Thickness of
jam

POP: Richness of
fruit
POD: Value for
money

Decisions
Benefits

Ease of
spreading
Value for
money
Sweetness
Flavor
Sweetening
chapatis,
dosas
Saves time

PROBLE
MS
Sweetness
Color
Thickness
Flavor

1. SWEETNESS:
1. find optimum sweetness level preferred
2. research if sugar free content is needed
if yes, find substitute for sugar as sweetne
2. COLOR:
3. THICKNESS:
1. Check for consistency in texture
2. Ensure no free liquid, pieces of fruit
4. FLAVOR:
1. Best seller flavours need to be introduced
2. Low sellers need to be removed
Ex. Papaya can be removed

Packaging
Decisions

Observations
Content is too elaborate
Brand name is not prominently
visible
Letter font style is very amateur
Color combination is not
appropriate
Image of fruits too cluttered

1.
2.
3.
4.

Bright/attractive colors
Images appealing to kids
Make brand name visible
Change font style

1.
2.
3.
4.
5.

1kg
500gm
200gm
100gm
15gm

SKU
Nissan

Sil

NACC0

500

500

500

200

200

1kg

100

100

4kg

50

Sachets
(15gm)

Consumers might not prefer the large

packs and might demand for smaller
packs-on the move

Distribution
Manufactur
er

FADD

Stockists

Retailer

Consumer

Current
System
1. Distribution Structure1. More level of intermediaries between Manufacturer and Consumer
2. Marketing & Distribution handled by same entity

Manufactur
er

FADD

Stockists

Retailer

Consumer

Suggestion-1- Separate marketing

agency

Manufacturer

Stockists
Suggestion-2

Retailer

Consumer

Commissions
NACCO
Commissio
n%
Ex-factory

Kissan

Amou
nt

Commissio
n%

53.9

Sil
Amou
nt

Commissio
n%

91.48

Amou
nt
87.21

FADD

4.2

Stockist/Whole
seller

6.3

5.5

5.89

5.5

5.61

Retailer

5.6

9.63

9.18

MRP
70
107
Observations
Low retailer commission given by NACCO might be a primary influencer
in affecting sales
A major part of the commission is given to FADD which, if avoided,
might influence sales

102

Price

Per unit realization of channel members will increase if the price is increased
Since consumption is high in South India, price can be kept high there i.e. a
differential pricing method can be adopted

New Price- Across India- Min. Rs. 70 For 500gms glass bottles
Cost Heads

Value:2013
Single pricing
with FADD

Value:2013
Single pricing
without FADD

Fixed Cost (2%)

16.4934

17.7786

Material (6%)

21.13958

22.78682

Bottle (5%)

6.7914

7.3206

Label (5%)

1.1319

1.2201

Excise and VAT

4.5

4.9

Profit Margin

6.2

6.7

56.25628

60.70612

Ex-factory price
Break-even
point

60652
Gradual
change

60515

Present Ad
Not
Visible

The Image
is not
appealing

Image is not
appropriate
according to
target segment

Copy Written is
amateurish