Case of Naturals Ice

Cream
Group members

Mrugesh Bagadia M 1102

Prateek Bisht

M 1107

Jyoti Dikshit

M 1111

Rupa Nayak

M 1139

Jay Shah

M 1150

Shibani Shah

M 1152

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Preface
The MMS course is well structured and integrated course of business
studies. The main objective of practical training at MMS level is to develop
skill in students by supplement to the theoretical study of business
management in general. The MMS course provides students with a
fundamental knowledge of business and organizational functions and
activities, as well as an exposure to strategic thinking of management.
In every professional course, training is important factor. Professors
gives us theoretical knowledge of various subjects in the college but we are
practically exposed to such subjects when we get the training and learn the
practical real time case-studies. We can learn about various departmental
operations being performed, which would in return, help me in the future
when we will enter the practical field.
Case studies are particularly useful in depicting a holistic portrayal of
a client's experiences and results regarding a program. Case studies are used
to organize a wide range of information about a case and then analyze the
contents by seeking patterns and themes in the data and by further analysis
through cross comparison with other cases. We get help to analyze any
situations i.e. we can relate it to some other case and find out the solution.

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Acknowledgement
With immense pleasure, we would like to present this project for
Naturals Ice creams. It has been an enriching experience for us to undergo
the case-study of Naturals Ice creams. As the students of
NAVINCHANDRA MEHTA INSTITUTE OF TECHNOLOGY AND
MANAGEMENT we would like to express our sincere thanks to Mrs.
Anita Bobade for giving us the case-study of Naturals Ice creams.

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Contents
Case Facts...................................................................................5
Key Issues..................................................................................21
Analysis.....................................................................................21
Conclusions...............................................................................24
References.................................................................................25
References

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Case Facts
Origin
Naturals Ice creams was started in 1984 by Mr. R. S Kamath with an initial
investment of Rs.3Lacs. This was the 1st business venture he embarked on all by
himself with the idea of introducing ice creams in a Naturals way.
Since he had domain experience from his past workings with his brother in
his own business-Gokul, a chain of restaurants serving ice creams, fast food and
juices. What dawned on him was to introduce ice creams with no preservatives,
stabilizers or artificial flavors.
At that moment the market was dominated with players like Amul, vadilal,
Kwality so to give them an edge he started adding bits of fruits to the ice creams.
A few months after the outlet opened he introduced 15 new fruit flavors, of
which Sitafal was an instant hit. He even introduced Jamun flavor on the feedback
of a customer.
Initially he had started with a single outlet of 300 sq.ft in Mumbai, and now
he possesses 70 outlets across the country. All the outlets get there ice creams
from factory in Charkop, Mumbai.
As the ice creams have no preservatives and fresh fruits are added, the stock
must be sold and consumed within a short time period of its manufacturing.
The philosophy is to find the purest and finest ingredients for producing ice
cream. This is the reason Naturals ice cream epitomes the finest ice creams of
India.
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In 2006 it was voted as one of the top ice creams at the 2 nd consumer
Reaction Award conducted by Bhararti Vidyapeeth Institute of Management
Studies and Research and a daily newspaper in Mumbai.

Some of the major players in Indian Ice cream Market

Amul Ice cream

It was launched on 10th March, 1996 in Gujarat. The portfolio consisted of

impulse products like sticks, cones, cups as well as take home packs and
institutional/catering packs. Amul ice cream was launched on the platform of
Real Milk. Real Ice Cream given that it is a milk company and the
wholesomeness of its products gives it a competitive advantage.
In 1997, Amul ice creams entered Mumbai followed by Chennai in 1998
and Kolkata and Delhi in 2002. Nationally it was rolled out across the country in
1999.
It has combated competition like Walls, Mother Dairy and achieved the No
1 position in the country. This position was achieved in 2001 and it has continued
to remain at the top.
Today the market share of Amul ice cream is 38% share against the 9%
market share of HLL, thus making it 4 times larger than its closest competitor.

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Not only has it grown at a phenomenal rate but has added a vast variety of
flavours to its ever growing range. Currently it offers a selection of 220 products.
Amul has always brought newness in its products and the same applies for ice
creams.
In January 2007, Amul introduced SUGAR FREE & Prolife Probiotic
Wellness Ice Cream, which was a first in India.
This range of SUGAR FREE, LOW FAT Diabetic Delight & Prolife Probiotic
Wellness Ice Cream is created for the health conscious.
Amuls entry into ice creams is regarded as successful due to the large
market share it was able to capture within a short period of time due to price
differential, quality of products and of course the brand name.
Amul Business Model
Amul followed a unique business model, which aimed at providing 'value
for money' products to its consumers, while protecting the interests of the milkproducing farmers who were its suppliers as well as its owners. As milk was a
perishable item, the farmer suffered a loss if it was not sold before the end of the
day.
Amul bought all the milk offered by the milk producer, made timely
payment, and shared with the producers the profit generated from marketing the
milk and milk products under the Amul brand name...
Introduction
Gujarat Cooperative Milk Marketing Federation (GCMMF), the largest food
company in India, recorded a turnover of Rs 2882 crore ($ 0.65 bn) in 2003-04. Its
flagship brand 'Amul' was the market leader in butter, whole milk, cheese, ice
cream and dairy whitener. GCMMF was the largest cooperative movement in
India with 2.2 million milk producers of Gujarat organized in 10,552 cooperative
societies. GCMMF collected 5 million litres of milk per day from its shareholders
who owned 3.2 million buffaloes, one million cows and 0.3 million crossbred
cows. The Federation's extensive marketing network comprised 3000 distributors
and 500,000 retailers spread across the country.
Pricing
Amul's philosophy had all along been to deliver value for money to its
customers. Despite being priced economically, Amul maintained its product
quality.
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Distribution
GCMMF's (Gujarat Cooperative Milk Marketing Federation) formidable
distribution network comprised 300 stock keeping units, 46 sales offices, 3,000
distributors, 100,000 retailers with refrigerators, an 18,000-strong cold chain, and
500,000 non-refrigerated retail outlets.
Advertising and Sales Promotion
Over the years, Amul's advertising philosophy had been "to be simple, fresh
and innovative". The clean, emotion-based ads refrained from using hi-tech special
effects, and aimed at maintaining the perfect balance between the traditional and
the modern.

Mother Dairy ice creams

It was launched in the year 1995 and has shown growth over the years and
today has approximately 62 percent market share in Delhi and NCR.
It introduced new flavours like Oblast, an orange based ice cream dessert
and the Toffee twist. Its brand Chillz that targeted the entire family was aired as
TV commercial with tagline, Goodness Inside.
It has range of ice creams particularly targeting children, like the Lic
Lolleez Cool buddies. It also targets the segment aggressively by arranging a
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media blitzkrieg in summers and plans to increase the number of carts outside
schools holds contests and promotions offering goodies to them.

Kwality Walls

It was launched in 1995 as Hindustan Unilever Ltds master brand for ice
creams. Unilever claims it to be the Worlds biggest ice cream manufacturer with
an annual turnover of euro 5 billion.
Their product is termed as Pleasure food, and enjoys great popularity.
Some of them are Cornetto, Feast, and Paddle Pop. Also by introducing a new
product, Moo, calcium enriched ice cream, the company lured kids and their
mothers with its nutritional offering.
Kwality walls have also introduce its retail brand named Kwality walls
Swirls parlours in tune with the growing number of shopping malls in the
country. At present there are 51 parlours across country.

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Vadilal

In 1972-73, the company had 8-10 outlets in Ahmedabad. Gradually, it

moved from the city to other parts of Gujarat. By 1985, the company moved
towards neighboring states like Rajasthan and Madhya Pradesh. But the expansion
was undertaken very methodically and it spent five to six years in spreading the
business and then consolidating it.
The Ice Cream industry in India today has a turnover of Rs. 15 billion [US$
330 million]. A quarter of this comes from the house of Vadilal alone. But thats
no surprise, considering that they have the largest range of Ice Creams in the
country 120 plus flavors, 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. Something for all tastes, preferences and budgets.
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 taste, preference and budgets.
To meet with the consumer demand on regular basis, Vadilal introduces new
flavors 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
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Happinezz Parlor, which regularly have ice cream, hot fudge, nuts, whipped
cream, cherries and other toppings of their choice.
Vadilals concept of serving ice creams with a difference was launched in
1991 with the name Happinezz. Happinezz parlors are now popular hangout
places for all age groups. But that is no surprise considering that the group has the
largest range of ice creams in the country in a variety of flavors, packs and forms.
Brand Promotion
Basically, they are very well known brand in every nook & corner of the
country with a strong brand image and high brand recall.
They generally promote their brand through various ways like,
Advertisement, Sponsoring Events, and by providing Publicity material (Glow
signs, Danglers, Posters, Banners etc.) at their Retail Outlets. They basically look
forward to print media as main stay to promote their brand & for the advertisement
of their products as well as schemes / offers, as well as TV commercial to cover
maximum consumers. They give advertisement in leading National (Hindustan
Times, Times of India etc.) as well as popular Vernacular Dailies (like, Gujarat
Samachar, Divya Bhaskar & Sandesh in Gujarat, Rajasthan Patrika & Dainik
Bhaskar in Rajasthan, Dainik Jagran & Amar Ujala in U.P. & Uttranchal, etc.) and
done TVC in leading TV channels like Star Plus, Star News, Cartoon Network,
Nick, UTV and Hungama etc,.
At present they do not have any celebrity connected with their Ad
Campaigns. However, they take Models for their Product & Brand Promotion.
Sales Network
Vadilal has very strong sales network, they have a sales team network,
which covers their entire distributor network. They have a state wise sale team,
which generates sales through retail outlets, institutions, Hotels & restaurants,
Functions. Here for Sales, Company management plays major role like providing
various Dealer schemes, consumer schemes etc. Vadilal has one of the widest
ranges of consumer schemes in the industry. More sales are generated through new
product developments, schemes and lucrative dealer margins.
Network: Plant - C&F Distributor Dealers Consumers

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With their supply chain of about 23 C&FA, more than 500 Distributors
and over 40,000 Retailers ice cream is widely accessible in most parts of India. Ice
cream can be purchased in big tubs and surrounds from supermarkets/grocery
stores, in smaller quantities from ice cream shops, convenience stores, and milk
bars, and in individual serves from small carts or even at public events and places
Plants
Ahmedabad, Pundhra, Gujarat and Bareilly, UP
Above three plants are located in geographically favorable areas with ultra
modern production facilities. It is their quality traditions and stringent norms only
due to which their plants are accredited with worlds most trusted quality
standards like ISO 22000:2005, ISO 9001:2000 and BRC Global Standard - Food:
Issue 4
Distribution Network/ C& F agents
The reason for having strong distribution and dealer network is due to the
lucrative margin and returns that Vadilal provides to them. Vadilal provides them
deep freezers for storage of ice creams, Display sing broads, POP, etc promotional
material that helps for in boosting business.

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Market Share of Various Ice Cream players in India

Source: www.dare.co.in/opportunities/other-business-opportunities/ice
cream-industry-in-India.htm

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Naturals Ice Creams Positioning Strategy

Offering 100% vegetarian ice cream in a country like India where religious
aspects and traditions hold great importance has given Naturals an edge over its
competitors in the market. Moving away from artificial was its Unique Selling
Proposition, which was adored by the Indian consumers.
Naturals has positioned itself differently by offering wide product variety
with reasonable price range, methodology adopted for quality service and through
customers preferred locations.
Product Range:
Differentiating itself from established market players by offering fruit-based
flavors Naturals has created a niche for itself. Besides the other dry-fruit,
chocolate based flavors these fruit-based ones became the customers choice.
By frequently introducing new fruit flavors like raw mango (pickle flavor)
Naturals served its customer in innovative way adding to their taste.
Seasonal Products

Rs.

Sitafal

32/-

Mango

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Tender Coconut

32/-

Watermelon

32/-

Chickoo

32/-

Papaya-Pineapple

32/-

Peach Apricot

32/-

Jack Fruit

32/-

Regular
Malai

32/-

Butter Scotch

32/-

Kaju Kismis

32/-

Anjeer(FIG)

32/-

Coffee Walnut

32/-

Choc Almond

32/-

Choc Cream

32/-

Choc bite(chips)

32/-

Roasted Almond

32/-

Kesar Pista

32/-

Physical Structure:
The hand-churn method adopted by Naturals for its ice cream making gives
rise to much denser, creamier and richer structure unlike the industrially or
machine made ice cream.
Capitalizing on consumers mindset:
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Devoid of preservatives and emulsifiers the fresh taste of hand churned ice
cream is truly cherished by the people. In this way Naturals tapped the Indian
consumers preference for Naturals and fresh food over the artificial ones and
offered exactly the same. It has won the loyalty of its consumers.

Price:
Offering its variety of products through a reasonable price range Naturals
stood out among its market competitors.
Rs.32 bucks a scoop is perhaps the lowest price among branded ice creams.
Naturals has consciously priced the seasonal as well as the flavours that
are available throughout the year equally. Its outlet also offers a waffle cone just
for an additional Rs.5 against its competitors like Bask in Robbins who charge Rs.
11 for it.
Place:
Demographic and demand analysis for opening an outlet or parlor has
helped Naturals to locate its potential customer base and reaching out to them in
more numbers.
Studying the consumer behavior in advance market conditions and realizing
the shifting habits of consumers from shop to malls it opened a counter in Mega
Mall in Mumbai.
Processes:
Understanding its need to reach out to the customers in highly competitive
market along with its outlets in different locations Naturals has adopted different
methodologies to attract its consumers like free home delivery, offering them
services on long journeys or picnics.
Following a rigid quality control program at its Mumbai plant they have
been successful in maintained their quality product status winning the consumers
belief.
Physical Evidence:
Providing good ambience, with seating facility at its outlets, it is serving
consumers through its hospitable nature.
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Network:
Naturals has built-up a strong network through its suppliers, franchisees
and distributors.
1. Suppliers
Creating dedicated supplier base to obtain the timely delivery of the
raw materials required.
Fruits are bought from Metros and APMC market situated in Vashi, Mumbai
APMC caters to seasonal fruit requirement and the Metro market supplies off
season fruits to the companys factory located in Kandivli, Mumbai.
2. Franchisees
Carefully selecting franchisees by studying the area in terms of
capacity, competitors and demand factor before setting up an outlet.
3. Distributors
Consciously opting for centralized distribution channel from Mumbai
given a premium product base.
Facilitating transport through their own trucks and vans for
distribution to the outlets in Mumbai, Nasik, Ahmedabad, Bangalore,
Pune, Jaipur, Hyderabad, Kolhapur, Shirdi and Goa.
Ahmedabad 1 Outlet
Nasik1 Outlet
Shirdi1 Outlet
Mumbai 52 Outlets
Bangalore 4 Outlets
Pune 11 Outlets
Goa 4 Outlets
Kolhapur 1 Outlet
Hyderabad 1 Outlet
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SWOT Analysis of Naturals

Strength:
No preservatives, stabilizers, emulsifiers.
100% Vegetarian ice cream.
Made from fresh fruits.
Made from Naturals ingredients.
Rigid quality control at their manufacturing plant.

Weakness:

Ice cream shelf life of 3 days.

Poor supply chain management.
No promotion strategy except relying on word of mouth.
Limited business channels.
Relying on old distributors only.

Opportunities:
Potential to become a national player.
Increase their profit margin by targeting organisers of events like award
ceremonies, marriages, business meetings etc.
Opening retail outlets at high end places like shopping malls, airports etc
Threats:
Health Conscious products from competitors like Kwality walls and Amul
which is eating the market share of Naturals.
Attractive customer services offered by their other competitors.

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Assumptions
Mr. Kamath didnt believe in spending time on outlet ambience but instead
believed his product will speak for itself. It worked as an advantage for him as he
was not under pressure to earn high returns immediately.
Mr. Kamath didnt believe in promoting his product but in word to word
publicity.
Your product should be your best advertisement. Attract customers by
taking care of their needs and requirements. A business flourishes if its virtues
spread by word of mouth rather than advertising gimmicks. It may be slower, but
it is sure path to success, R.S. Kamath in an interview to Hindustan Times on 15
July, 2008
Whichever methodology he uses to flourish in his business, he believes in
maintaining the brand name.

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Naturals ice cream faced many Challenges like:

1. Indian ice cream market was not only slow but also laborious and
production had to be done manually, which meant maintaining the
consistency in taste was a huge challenge.
2. His education background poised a problem to him at one point of time. He
was unable to handle the taxation issues.
3. He believed in no distribution techniques and he did no promotion of his
product.
4. Supply of ice creams from the factory in Charkop imposed a problem of less
life span of the ice creams.
5. Since the ice cream contained fresh fruits, it had to be consumed within 24
hours.
6. Naturals ice creams started facing problems when the market share of its
competitors like Amul and Vadilal increased.

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Key Issues

Should Naturals increase its advertising to reach out to larger segment of

the masses?

How can Naturals expand its market?

How to make a Local Brand into National Brand?

Analysis

Should Naturals increase its advertising?

The Indian Market changes at its own speed which cannot be
predicted. One cannot walk on the same strategies and plan of actions.
Today, the Indian Ice cream Market has changed. There are many national
and international players which directly and indirectly act as the competitors
to Naturals. As competitors and there changing patterns or strategies,
Naturals have to be changed in terms of selling methods.
Word of mouth publicity did miracles to the sales. Naturals showed
25 crores of sales in 2009 and the net profit touched 1.5 crores and is
determined to double it in the subsequent financial year. Without any
external efforts on advertising, Naturals found its way into the market and
is running at a stable speed.

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Naturals traditionally focused on attracting youth and family with

kids by their products. Running on one outlet at initial stage produced
fruitful outcomes but then the market changed and so did outlets of
Naturals increased. From the above we conclude that Naturals is making a
steady progress with every passing year and it does not need any advertising
gimmicks.

How can Naturals expand its Business?

Naturals possesses 70 outlets throughout the country but it has
limited its reach to the retailers. As it is been seen, there is a boom in the
area of business of shopping malls and hotels, many ice cream
manufacturing houses have expanded their business. Naturals should start
making use of shopping malls, five-star hotels and airports. It should also
provide ice creams to events such as high profile gatherings and other such
events. Since Naturals keeps on introducing new flavors there is no left
scope for them so they should shift their focus on pro-biotic products since
people have become health conscious and it is a need for diabetic people. To
beat its competitors who have already entered the market of pro-biotic
products, this can give an additional advantage to Naturals. As it is been
known Naturals have spread its business in some major parts of west and
north but the supply of Ice cream is done from one factory in Charkop
located in Mumbai which meant there is a scope of improvement in terms of
supply chain management and that distributers should be assigned to make
the supply chain easier. When the side-lined problems are eliminated, the
focus can be shifted on expanding the business in areas where expansion is
possible. Net profit of Naturals might not be effective in terms of opening
new outlets in unreached areas or starting new factory setups. Considering

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the well-rooted name of Naturals, hands are open by the people as well as
the market for Naturals to establish and wide spread its business.

How to make Naturals into National Brand from local brand?

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As seen in the above picture, Naturals do not want to expand their business
Nationally or Internationally.

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Conclusions

Naturals ice cream has already achieved its success sans advertising.

It has also created a niche which keeps at bay the threats posed by new
entrants.

If it follows the given recommendation, it can retain its competitive edge &
expand its market.

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References
Nuzhat Aziz, Hindustan Times, Mumbai, July 15, 2008
http://www.hindustantimes.com/StoryPage/Print.aspx?Id=db0863ac-c29e-45878e1a-379dc0af5f6fSmallideasbigchanges_Special
Jhilmil Motihar, India Today , Cold is gold, November 27, 2008
http://indiatoday.intoday.in/site/Story/21118/ECONOMY/Cold+is+gold.html

http://www.Naturalsicecreams.in/company/media.asp

Manglorean Times, Mumbai Dec 14, 2008

http://www.mangalorean.com/news.php?newsid=104990&newstype=local

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