Dabur

Dabur on Wednesday posted a 15.7% increase in consolidated net profit at R243.6 crore for the third quarter ended December 2013 on account of robust sales across business verticals. The company had posted a net profit of R210.5 crore in the same period of the 2012-13 fiscal.

Consolidated net sales in Q3 FY14 rose 16.8% to R1,904.3 crore against R1,630.7 crore in the year-ago period, Dabur India said in a statement. "Our focus on brand-building and market expansion programmes coupled with a greater degree of innovation has helped Dabur sustain strong growth in the core categories, which have been significantly ahead of the market," Dabur India CEO Sunil Duggal said. Going forward, the company's focus will be on pursuing an aggressive and profitable growth strategy, he added. During the quarter, the company said, its health supplements business grew 9.5%. The air freshener business grew over 27%.

 

Nashik Grape

Nashik is India’s largest grape production city.

According to Mr. Ashok Gaikwad, president, Maharashtra state grape growers association (MSGGA) said, “Around 22000 vineyards from Nashik alone have already registered with Grapenet, the online platform developed by agricultural and processed food products export development authority (APEDA), as opposed to about 15000 last year registering the farm on Grapenet is mandatory for farmers who want to export the fruit. Last year, a record 6000 containers (one container equals 12.5 tones)  were exported from Nasik to the European union (EU), amounting to around 70000 metric tone. This time, export should exceed 70000 metric tones.” he said.

Around 10 lakh metric tone of grapes are expected to be produced in the nashik district, with productivity at 20 metric tone per hectare. The other grape growing districts include solarpur and sangli.

Nashik district is the largest producer of grapes in India with nearly 1.75 lakh ace=res under vine yards while the total acreage in Maharashtra is 2.50 lakh acres. This year the state has less than 2.50 lakh acres under grapes. Maharashtra contributes 90% of the country’s total grape exports. Around 70% of the states grape exports come from Nashik.

Parle, Britannia, ITC and now Pepsi. Pepsi foods is seriously contemplating its entry into the 6000 crore plus organized biscuit market. Taste tests are on in various urban markets across India.

They are still yet to come up with an official brand name for their new portfolio. It would be interesting to note if they would follow either a Parle/Britannia strategy or an ITC strategy. ITC typically follows a branding strategy under the umbrella name "Sunfeast". With multiple sub-brands created under this banner. This has been logical for ITC due to its late arrival into this category. A common brand name across its portfolio would ensure better recall among the consumers.

Parle/Britannia have multiple brands that are well established, e.g GoodDay, Tiger, Milk bikis, Monaco, 50-50, Krackjack, Hide&Seek etc. Glucose biscuits have always been a price game with little money being made by each of the 3 existing players. A price increase of even a rupee will involve significant risk with respect to the response that would ensue from the consumers. Hence these 3 companies have been constantly tinkering with their weight/grammage during the period when input costs have risen.

Pepsi would mostly enter first into the salted biscuits category as per their information given to the Financial Chronicle. There are strong household names like 50-50, Krackjack and Monaco in this sub-category. Even ITC is trying to eat into this pie with their Snacky label. Innovation with salted biscuits have included products like Salt & Sweet, Salt & Chilli Cracker, Maska Chaska etc.

Pepsi food's products, locally distributed by Frito Lays include namkeems and finger snacks. Their foray into the biscuits market would be their first across the world, in the various markets that they operate in.

Pespi is already against ParleAgro (separate entity) in the beverages market and head-on-head with ITC in their snacks category (Lays Vs. Bingo) The biscuit market is estimated to register a 10% growth every year.

Pepsi has a well established distribution system in India, made robust by being in the complex bottling business, but whether it would invest huge amounts into establishing their biscuit brand remains to be seen. The other 3 companies are all currently heavily focused on increasing their market size in India. Hence taking them on would not be a easy feat.

We will have to wait and see what kind of response it would get from Organized Retailers, who all have their private labels like Tasty Treats, Feasters etc. But like ITC leveraging on its other brands, Pepsi could very well give its biscuit business a push by leveraging on its very well established beverage portfolio.

Supply Chain as a Strategic Asset

Research shows that high performing supply chins can achieve sales and revenue growth while managing cost. That sounds like a tall order but there are things one can do now to manage a supply chain as a strategic asset to boost performance and profitability, says a PWC survey, ‘Next-Generation Supply Chains.

The survey results show a supply chain can deliver both growth and efficiencies if the company is clear about what the business competes on and design and manage the supply chain from the customers’ perspective.

High-performing supply chains support key value propositions like breakthrough products, distinctive services and unique customer experiences. In these companies, the supply chain isn’t just an issue to be dealt with by the entire organization is mobilized around the supply chain strategy. That once the c-suite recognizes that a supply chain is a source of competitive advantage, it will be easier to persuade executive to make the investments needed to bring supply chains up to the next level.