A PROJECT ON Distribution enhancement in unconventional outlets in parts of Mumbai for Perfetti Van Melle

SUBMITTED BY

Abbas Reyroadwala Roll No. 2 MMS (2005 - 07)

UNDER THE GUIDANCE OF MR. BHAVIK JOSHI FOR PERFETTI VAN MELLE

RIZVI INSTITUTE OF MANAGEMENT STUDIES & RESEARCH

CERTIFICATE

This is to certify that

Mr. ABBAS REYROADWALA

Student of MMS II, Roll No. 2, has carried out his Summer Training at

PERFETTI VAN MELLE

In partial fulfillment of the Management Studies Courses (2005-2007) conducted by the University of Mumbai through RIZVI INSTITUTE OF MANAGEMENT STUDIES AND RESEARCH in Operations Management During the academic year, 2005 2007

_______________________ ____________________ Mr. BHAVIK JOSHI KHAN Area Sales Manager (Modern Trade and Institutions) Prof. KALIM (Director)

ACKNOWLEDGEMENT
I would like to express my gratefulness to Mr. Kalim Khan (Director), Rizvi Institute of Management Studies And Research for his valuable guidance and constant encouragement in the project work. His persistent interest has been a source of inspiration to me. During the course of this project, a lot of people have helped. Although it would be impossible to mention everyone, I particularly want to express my appreciation to the following individuals: I am thankful to my project guide Mr.Bhavik Joshi of Perfetti Van Melle for his constant motivation and priceless guidance. I am also thankful to Mr.Devang Saraiya who earlier worked with Perfetti for guiding us in the initial part of our project. Special thanks are due in particular to Mr. Murli Krishnan, regional with this company. sales

manager of Perfetti Van Melle, for providing us with the opportunity of working

Last but not the least I would like to give my sincere regards to all my friends and college staff for their kind co operation towards completion of my project.

______________________ ABBAS REYROADWALA EXECUTIVE SUMMARY

The size of the Indian confectionary market is estimated at Rs. 26.0 billion ($600 million). The confectionary market is highly fragmented with several local players such as Parles, Nutrine, and Ravalgaon. Key foreign companies are Nestle, Cadburys, Perfetti, Lotte, Wrigley, Candico, and Joyco. The Confectionery industry that I was assigned, I have studied two major sub-industries i.e. Candy & Chocolates. Cadbury dominates the Chocolate industry with having 70% of market. Product line for Candies comprises of Candies, mints, chewing gum & bubble gum and Perfetti is a dominatnt player in this product catagory. The Company is planning to expand its existing distribution network of 3500 to 4500. The products are sold at 6.5 lakh retail outlets all across the country. Also the products are stocked at 2.5 lakh pan shops all across the country. The share of modern trade in total sales is rising for Perfetti Threat to Perfetti mainly arises through other major players in the market. The rising cost of inputs particularly sugar has added to the cost factor. The vast untapped rural market is dominated by local also presents a threat. 4

The project that I was given was to target various unconventional outlets and convert them into outlets that stocked our products. During the course of project I approached outlets like branded apparel showrooms, mobile phone galleries, hotel chains, gift stores, cyber cafes, etc.

The emphasis was on the above-mentioned outlets as they were more inclined to provide better customer service to their clients and hence would use our product to give it to their clients as a freebie.

In the next phase of the project, I studied the distribution channel of Perfetti in supplying products to railway stations and convincing the stockist to stock our product through company distributor.

TABLE OF CONTENTS Sr.No.

1. 2 3 4 5 6 7. 8 9 10 11 12 13 14 15 16 Introduction Confectionery Industry: A global perspective Indian confectionery industry Marketing Mix Major Players and their policies Industry Scenario Company Profile Product and Product Mix Product Assortment Offered by Perfetti Van Melle First Phase of Project: Unconventional market Findings and Suggestions Second Phase of Project: Studying the distribution channel for Railway Station Findings and Suggestions Observations Recommendations Bibliography

CONTENT

Page No.
06 08 14 16 26 30 32 37 39 45 46 48 49 52 53 54

INTRODUCTION
Sitting in a conference room with Branch Manager and sharing our experience of the market with him was a unique and gave a feel of how the corporates functions. I did my summer internship program with Perfetti Van Melle(PVM) one of the leading confectionery companies globally. Currently, it operates in many countries across Europe, Asia, Africa and South America. PVM a leader in gum, candy and chewy segments with portfolio of strong brands like Big Babol, Center Fresh, Alpenlibe, Chlormint, Mentos and Marbels are favorites amongst millions of people. It is the company which revolutionalised the confectionary market and the way companies do business in this sector. PVM brands known for their great taste and excellent quality are manufactured at state of the art manufacturing facilities located like Manesar in Haryana and Chennai using the most modern process technologies and product development know how. Its product are directly distributed to over 4,00,000 outlets through around 4000 distributors in what is one of the most efficient distribution system set up in the country within a short span of 10 years. The company spends around 10% to 15% of sales on advertising Through creative and effective advertising PVM has created some of the best brands in this sector. Perfetti Van Melles insight about its consumers combined with its strengths in product development, access to world class technology and great advertising enables it in bringing joy to the life of millions of its consumers and prosperity to its business partners.

As far as my project is concerned, the areas of operations were in Mumbai and also studying the distribution channel of the company servicing various canteens in railway stations from Mumbai up till Nagpur. I started my project on the 8th of May 2006. My project started with a week of training in which I was made to do retailing. The aim of the training was to give a first hand experience to us about how FMCG products are sold to primary customer through the companys distribution channel. I went to all the retail outlets with the salesman in a particular area, i.e.Andheri. The areas are divided in three categories P1, P2, P3 and a distributor takes the charge of distributing the product category, which is assigned to him by the company. Thus the area Andheri will have three distributor and they will have one product category. On an average a salesman used to visit 60 retail outlets out which most used to turn out to be productive. I did retailing for six more days in various other parts of Mumbai. My project dealt with the distribution enhancement of the unconventional markets in Mumbai. I was asked to strengthen the network of the company by locating such outlets, which have not been covered by the company so far, and more importantly they lie outside the usual distribution network of the company. Such outlets included places like restaurants, branded showrooms, cyber cafes, beauty salons, toy stores, mobile service providers etc.

CONFECTIONERY INDUSTRY: A GLOBAL PERSPECTIVE

Introduction
The confectionery market consists of cereal bars, chocolate, gum and sugar confectionery. The market is valued according to retail selling price (RSP) and includes any applicable taxes. The global market consists of Europe, Asia-Pacific, the USA, Argentina, Brazil, Canada, Chile, Colombia, Mexico and Venezuela. The global confectionery market grew at a steady rate over the past five years, and this trend is expected to continue throughout the forecast period. Mars, Inc is the leading company within the global confectionery market. The leading distribution channel within the global confectionery market is the supermarkets/hypermarkets. The global market for confectionery grew at a steady rate over the past five years, and this trend is expected to continue throughout the forecast period, with good performances from the Chinese, Polish and Indian markets driving global revenues upwards. The global market is expected to reach a value of $107.6 billion by the end of 2010, an increase of $17.4 billion since 2001. The global confectionery market generated total revenues of $98.1 billion in 2005, this representing a compound annual growth rate (CAGR) of 2.1% for the five-year

period spanning 2001-2005. Market consumption volumes increased at a CAGR of 1% between 2001-2005, to reach a total of 14.6 billion kg. The leading revenue source for the global confectionery market is the chocolate sector, which generated total revenues of $54.6 billion in 2005, equivalent to 55.7% of the overall market value. In comparison, the sugar confectionery sector was worth $29.5 billion, which represented 30.1% of the market value share. Going forward, the global confectionery market is expected to grow at a slightly slower rate than in previous years, with an anticipated CAGR of 1.9% for the fiveyear 20052010 period expected to drive the market to a value of $107.7 billion by the end of 2010.

Market Value The global confectionery market grew by 2.2% in 2005 to reach a value of $98.1 billion. The compound annual growth rate of the market in the period 2001-2005 was 2.1%.

10

Mars, Inc is the leading company within the global confectionery market, with sales of $10.4 billion in 2004; equivalent to a 10.9% share of the market. This firm plays a significant role in the confectionery markets of the US, the UK, Belgium, China, Denmark and Australia. Another major competitor in the global market is Nestle S.A.; the company generated total sales of $9.4 billion in 2004, equal to a 9.8% share of the market. Nestle is closely followed by Cadbury Schweppes plc, with 2004 sales of $8.8 billion and a 9.1% share of the market. The leading distribution channel within the global confectionery market is the supermarkets/hypermarkets sector, which generated sales of $28.8 billion and held a 30% share of the market in 2004. In comparison, the convenience stores sector generated sales of $14.8 billion and held a further 15.4% share of market distribution.

11

Global Confectionery Market Forecasts The compound annual growth rate of the market in the period 2005-2010 is predicted to be 1.9%.

12

Global Confectionery Market Segmentation I Chocolate sales account for 55.7% of the market's value. 13

Sugar confectionery sales generate a further 30.1% of the market's revenues followed by Gums category with sales value of 10.3 Billion US Dollars was the third largest category and followed by Cereal Bars with the sales value of 3.6 Billion US Dollars.

14

Market Segmentation II Europe is the world's largest confectionery market; it generates 50.5% of the global market's value. The US accounts for a further 26% of the global market revenues.

15

INDIAN CONFECTIONERY INDUSTRY

The Indian confectionary market can be divided into four categories - chocolate confectionery, sugar confectionery, gum and cereal bars. Sugar confectionery is the largest product category. It will remain the most lucrative category over the next five years. These products are most suited to the Indian climate. Chocolate and gum confectionery follow this, each with a similar sized share of the Indian market. Standard grocers are the leading distribution channels, with one third of the Indian confectionery market, by value. Traditional grocers are the only other channels to take a double-digit share. The remainder of the market shows a high degree of fragmentation. The size of the Indian confectionary market is estimated at Rs. 26.0 billion ($600 million). Sugar confectionary accounts for 61 percent of this market, with the balance being chocolates, mints, and gums. The confectionary market has been growing at over 6 percent annually over the last five years. The gum-based confectionary segment has grown even faster at over 10 percent. The confectionary market is highly fragmented with several local players such as Parles, Nutrine, and Ravalgaon. Key foreign companies are Nestle, Cadburys, Perfetti, Lotte, Wrigley, Candico, and Joyco.

Company Name Amul ITC Parle Products

Products Dairy products, ice cream, chocolate Branded wheat flour, biscuits, ready-to-eat food, confectionary Biscuits, candies, toffees

16

Nutrine Confectionary Company Confectionary, chewing gum

Multinational/ Joint Venture companies

Company Name Nestle Cadbury Perfetti Wrigley Lotte India Corporation Ltd. (Parrys) Confectionary Products Coffee, chocolates, confectionary, instant noodles, milk products, beverages, health drinks Chocolates, health drinks Chewing gum, candy Chewing gum

17

MARKETING MIX
Introduction
Neil H. Borden first used the term Marketing Mix in 1964 in his article, The Concept of Marketing Mix. He has used this term after James Culliton had described the marketing manager as a "mixer of ingredients". The ingredients in Borden's marketing mix included product planning, pricing, branding, distribution channels, personal selling, advertising, promotions, packaging, display, servicing, physical handling, and fact-finding and analysis. E. Jerome McCarthy later grouped these ingredients into the four categories that today are known as the 4 P's of marketing, depicted below: 1. Product 2. Price 3. Place (Distribution) 4. Promotion In the Confectionery industry that I was assigned, I have studied two major subindustries i.e. Candy & Chocolates. The major companies in Candies are Nutrine, Perfetti, Candico, and Parry-Lotte & Parle. Cadbury dominates the Chocolate industry with having 70% of market followed by Nestle with 20-25% share. The 4 Ps in terms of Candy industry, in general, can be described as: 1. Product- Product line comprises of Candies, mints, chewing gum & bubble gum.

18

2. Price- The price is set at 25 paisa, 50 paisa and Re. 1 for all the products covered in this segment. 3. Place- The distribution channel network is very extensive covering the nation with large no of distributors and retailers offering the products to the customers. Even the local pan-wallas play an important role in the sell of mints and candy. 4. Promotion- The promotional budget and strategies depend on company to company in this industry. Some use heavy budget and promotes their entire product line while some are happy with promoting their flagship brand and enjoying the heavy market share with it. Looking at the individual companies now: 1) Nutrine: This Rs 180 Cr industry is acquired by Godrej Foods &

Beverages. Looking at the 4 Ps

a) Product The product range comprises of Kokanaka cookies Elaichi cookies Maha Lacto Wild Koffy Aasay Chocolate Eclairs Aam Ras Nutrine Gold Gulkhand Superstar Assortment Caramella 19

 Marvel Assortment Lollipop Coolers b) Price The price for different products are set at 25 paisa (in rural areas), 50 paisa and Re. 1 c) Place Godrej will use the already existing distribution network of Nutrine alongside its vast network of distributors and retailers. d) Promotion The promotional scheme followed by Nutrine were scholarships, competition and attractive prizes. It enjoys a share of 80% in rural market because of its 25-paisa toffees. 2) Perfetti Van Melle : a) Product The product range comprises of: Alpenlibe (The flagship brand of PVM and a market leader) Alpenlibe Lollipop Big Babol Center fresh Center shock Chatter Patar Chlor Mint Choco Tella Cofitos Fruit Tella Happy dent White Happy dent Protex Marbles 20

 Mentos b) Price The price is set at 50 paisa and Re. 1 c) Place The Company is planning to expand its existing distribution network of 3500 to 4500. The products are sold at 6.5 lakh retail outlets all across the country. Also the products are stocked at 2.5 lakh pan shops all across the country. d) Promotion The Company spends 10-15% of its net sales on advertising. McCann Erickson handles the advertising account. 3) Lotte: The Korean giant Lotte acquired 60% of Parry stake on 16th Jan 2004. Later is took 20% of its stake through open offer. a) Product The product range comprises of: Coffy Bite Lacto King Caramilk Coconut Punch Spout Eclairs Butter Scotch Fruitz Coconut Crme Orange Candy b) Price The price of the gum and candies are priced at 50 paisa and Re. 1

21

c) Place The company operates through a network of 15,000 dedicated wholesalers and has access to 10 lakh retailers across the nation d) Promotion The Company spends 10% of its sales on advertising and promotion of its products. It also used repackaging of its top brand Coffy Bite to increase sales and came up with new products such as Butter Scotch from time to time. 4) Candico: a) Products The product range comprises of: Loco Poco Bubble Gum Gumbo Bubble Gum Time Bomb Big Bubble Gum Elaichi Roll Koffi Toffi Eclairs Fruits Candy Candi Mint Candy Lacto Plus Flavors Sweet Moments b) Price The price is set at 50 paisa and Re. 1. c) Place With 24 depots, 1500 authorized dealers and a 250 people strong sales force, Candicos distribution network in India has a direct or indirect reach in most towns and cities with a population of over 25,000. It is estimated that its brands reach to over 60% of Indias population. 22

d) Promotion Candico regularly enters into cross-promotional deals with other FMCG (Fast Moving Consumer Goods) companies to offer joint promotions to its consumers. Candico has entered into joint promotions with a number of large international and domestic corporations to jointly promote their product lines. Cross promotion was done with Coca Cola, Power2Youth Corporation & Nirulas. 5) Cadbury : a) Product - The product range comprises of: Dairy Milk Perk 5 Star Gems Celebrations Bytes Dairy Milk Eclairs Fruit & Nuts Halls Googly b) Price The price of Dairy Milk Eclairs is set at Re. 1 while the prices of chocolates are Rs. 5 and Rs. 10. The larger packs are priced higher accordingly. Fruit & Nuts starts from Rs. 22 and the Celebration pack comes in range of Rs 50 and above. c) Place Cadbury has a total no of 2,100 distributors with 3, 80,000-retail outlets. Cadbury is using entirely different network for candy operations. Total retail outlets for both chocolates and candy are 6 lakh. 23

d) Promotion The super hit campaign Kuch Meetha Ho Jaye launched Dairy Milk to the top of the market. Cadbury is endorsed by superstar Amitabh Bacchan and Preity Zinta. Cadbury was the highest spender in print media in 2005. Much of the revenue is used for brand building. Cadbury also had a tie-up with BPL mobile and E-cube to start a service to SMS a chocolate in Mumbai.

SEGMENTATION, TARGETING & POSITIONING

M. Porters Five-Force Model Introduction
Michael Porter's famous Five Forces of Competitive Position model provides a simple perspective for assessing and analyzing the competitive strength and position of a corporation or business organization. Porter model has a special ability to represent complex concepts in relatively easily accessible formats, notably his Five Forces model, in which market factors can be analyzed so as to make a strategic 24

assessment of the competitive position of a given supplier in a given market. The five forces that Porter suggests drive competition are: Porter's five forces: 1. Existing competitive rivalry between suppliers: Does a strong competition exist between the existing players. Is there any kind of monopoly prevailing in the market? 2. Threat of new market entrants: How easy or difficult it is for new entrants to start for competing, what are the entry barriers. 3. Bargaining power of buyers: How strong is the position of buyers? Can they work together in ordering large volumes? 4. Bargaining Power of suppliers: How strong is the position of sellers? Do many potential suppliers exist or only few potential suppliers, monopoly? 5. Threat of substitute products (including technology change): How easy can a product or service be substituted, especially made cheaper.

25

Confectionery Sector: 1. Threats of New Entrants: The entry of multinationals, aggressive rise of commodity branding and low cost of technology is changing the economics of the Indian food Industry. The rise of aggressive regional players making forays into categories where entry barriers are low and a boom in Indian FMCG markets and the rising need for these products are the key reasons for this growth in food business. The Confectionery industry is witnessing a 20% annual growth rate and, consequently, the demand for it in the country is constantly on the rise.

26

It is estimated that there are about 5,500 manufacturers in the unorganized sector who produce local brands, and duplicate or look alike substandard products. 2. Bargaining Power of Buyers: Due to the introduction of 8 per cent excise duty on confectionery products and an additional MRP based excise duty of 1.5 per cent, the overall 'cost increase' has been severely affecting the industry. Also due to the easy availability of the cheaper substitutes, the buyers hold a better stand in terms of bargaining with the confectionery manufacturers with respect to the price. 3. Bargaining Power of Suppliers: Various raw Materials required for the confectionery sector includes mainly: Sugar Various oil seeds like Sesame Seed Sun flower Seeds, Muskinelon Seeds etc. Packaging Material, etc. Cost factor is a key to the growth of the confectionery industry. Prices of sugar, the single largest ingredient of the confectionery industry, have gone up by 27% last year. Packaging material costs are up by 15-16 % and freight charges have increased by 20%. Similarly, freight charges increased by 20 per cent, mainly due to the increase in petroleum prices. The manufacturers are facing stiff competition and survival requires huge spending on promotion. If the organized players increase their prices, the unorganized sector will invade the market and add to the competition. Bargaining power of the suppliers is also affected by the Govt. regulations like some ingredients are subject to double taxation. While a 27

candy is taxed at eight per cent, if it has chocolate as another ingredient, it is subjected to 16 per cent tax. 4. Threats of Substitutes: This industry along with the existing within the industry competition is also facing stiff competition from the other substitute sectors. These include both organized and unorganized players. Some of those sectors are: Home made sweets (Mithai) Indian traditional sweets-(e.g., Bengali Sweets, Brijwasi, Haldiram etc.) Biscuits and cakes-(Monginis, Britannia, etc.) Ice Creams-(Kwality, Amul, Nirulas, Naturals etc.) Jams and Jellies-(Sil, Kissan, etc.)

5. Competitive Rivalry within the industry: Competition in the sugar confectionery market is heating up. Cadbury India has drawn up an aggressive marketing plan to promote its acquired brand 'Halls'. While Perfetti India is pushing its sugar confectionery brand Mentos with equal vigor. HLL on the other hand, has entered the fray with its Max Candy. Cadbury is strengthening its presence in the sugar confectionery segment with a brand new communication package and is looking at various retail initiatives to enhance the visibility of its brands. It plans to set up special Halls dispensers at retail outlets. To support its mass media ad campaigns, the company is planning to launch a package of above-theline-communication initiatives. Perfetti is also chalking out an ambitious marketing plan to promote its Mentos and Centre Shock. Perfetti has recently launched two television 28

commercials to promote the new variants of Mentos. The ad campaigns will be supported by dealer meets and retail initiatives. The sugar confectionery sector includes manufacturers like Perfetti India, Cadbury India, ITC and Hindustan Levers Ltd among others. Apart from that, the import of confectionery products is rampant in our country, amounting to the tune of Rs 200 to 300 crore. The manufacturers are facing stiff competition and survival requires huge spending for promotion. Now, on an average, the industry has to spend at least 10 per cent of the returns for promotion and branding. But their major problem is that they are not in a position to absorb the high cost and pass it on to the consumer.

MAJOR PLAYERS AND THEIR POLICIES

Candico
Candico is primarily a marketing led company and attempts to keep its ear close to the ground to produce innovative and interesting campaigns across media vehicles. Candico's savvy use of media has been commented upon by every major Newspaper and Magazine. One of their campaigns, Minto, "the whole mint" which positioned itself aggressively against Nestls POLO, is now a case study in numerous Business Schools throughout India. Global Expansion Plans: Candico, the Rs125-crore domestic confectionery company, is going global. The company is setting up a $5-million manufacturing plant in South Africa for catering to seven countries in the South African region. Having conducted an extensive market survey and competitor analysis in this market, the company is gearing up to tap the huge potential of this market where foreign brands have so far had very low penetration.

29

The Johannesburg plant is Candico's second unit in Africa since the acquisition of its plant in Tanzania for $1 million in October last year. It has now ramped up the capacity in its first plant from 1,800 tonnes to 3,900 tonnes per annum and is further increasing it by 40 percent within a year. Candico's second plant in South Africa will be followed by two more strategic acquisitions for catering to North and West African markets. Candico is steadily gaining a firm foothold in the global confectionery market. In the $100 billion global confectionery market, Candico is the only Indian multinational in the confectionery segment. The company's global expansion strategy is aimed at generating 50 per cent revenues from international operations in the next five years.

Cadburys
Cadbury's presence in India dates back to 1948, when the parent Cadbury Schweppes set up a wholly owned subsidiary Cadbury Fry (India) Ltd. In 1978, CSOL diluted its equity stake to 40% to comply with FERA guidelines. The name was changed to Hindustan Cocoa Products in 1982. Schweppes again raised its stake in the Indian subsidiary to 51% in 1992 through a rights issue. In its 5 decades of operations in the country, Cadbury has remained the market leader in chocolates with a 70% market share. Strong brand equity: The company's strong brand equity in the chocolate market is reflected by the fact that the Cadbury name is used synonymously with the category itself. Market growth in the chocolate segment has hovered between 10 to 20%. In the years 1995-2000, the category has grown by 14-15% on an average and is expected to continue growing at a similar rate in the next five years. The market presently has 30

close to 60mn consumers and they are mainly located in the urban areas. Growth will mainly come through an increase in penetration as income levels improve. It is now trying to add 10mn new consumers to our fold every year. Positioning: Snack food is a good "enabler". It helps in softening people for consumption, where the consumer feels that "yes, I can consume this product". There is an intended message behind the positioning of chocolates as snack food, there is a perceived message and then there is the actual use of the product. The positioning change however does not really affect market growth. Behaviorally, it is still consumed as a chocolate and not as filler. Perk still competes with a Dairy Milk and not with biscuits/ other snack foods. India is still far away from using chocolates as a snack food. You need to have an offer that adds value. At the end of the day, how many Indians can afford a snack food priced at Rs16-17 for 50gms?

ITC
Products: ITC acquired the brand "mint-o" from Candico in March 2002 and re-launched the compressed mint product mint-o with new and improved product and packaging. Mint-o is the first mint in India to be also available in an orange flavour besides the regular mint flavour. An innovative "Lemon mint" flavour was launched on 26th February, 2003. The product is available in two sizes rolls of 20s and 6s. mint-o offers the discerning consumer a value-added mint that captures the international essence of youthful "cool". mint-o is currently available in all major markets. 'Mint-O Fresh', a hard-boiled mint candy, was launched in October 2004 in two flavours. This launch extended the Mint-O brand, which had been present only as compressed mint tablets. The launch of Mint-O Fresh is in line with ITC's marketing strategy of adding excitement and contributing to the growth of the confectionery 31

category. It is in line with its business strategy of providing the adult consumer with the complete range of mint-based confectionery products across price points. Candyman Butterscotch Licks and Orange Licks were launched in December 2003 and are now available in markets across the country. This marked ITC's entry into the deposited candy market. In addition, Candyman Eclairs and Candyman hardboiled candies like Wild Banana, Mango Delite, Orange Josh and Pineapple Punch are also available across India. With two brands in its portfolio now, ITCs confectionery division is a serious contender in the market. Established confectionery players include Perfetti Van Melle, Nestle India, Hindustan Lever and Joyco. While Perfetti Van Melle, Nestle and Joyco have a comprehensive basket of confectionery brands, HLL muscled its way into this market last year with the introduction of Max hard-boiled candy in three variants. Given that confectionery is a large- volume, low-margin business, industry analysts point out that it would take ITCs confectionery business a minimum of two years to break even.

Nestle
Nestle India has signed up Rani Mukherjee to endorse its chocolate brand Nestle Munch. Nestle Munch sells at Rs5 per piece and the largest selling SKU in the chocolate and wafers category with widespread sales in metros and in smaller towns. The company feels that as the brand ambassador Rani Mukherjee complements the popularity of the Munch brand and like the brand, her star appeal cuts across age, town, class and SEC.

Nutrine
Has a presence in candies, cookies, coolers and gums.

32

Nutrine Confectionery Company Limited was founded in 1952.From a small-scale unit manufacturing only candies in the early 60s; Nutrine Confectionery has grown to be a multi-product, multi-market giant and continues to be the single largest manufacturer of confectionery and toffees in India since 1980. Since 1985 Nutrine has diversified into other food products: Chewing-gums Instant foods Dehydrated fruit bars of Mango, Banana, Papaya, Guava fruit pulp, processed fruits Nutrine has a wide range of more than 72 varieties of candies, toffees, lozenges etc. Being the leader in the industry for more than a decade, NUTRINE has always endeavored to satisfy the customers changing wants and desires with its special emphasis on quality, range and cost effectiveness. Nutrine enjoys a high market share of 34% in confectionery in the organized sector in India. Nutrine has a very extensive well-organized distribution system throughout India. Nutrine Confectionery Company Limited has Branch, Regional Offices at Madras, Bangalore, Hyderabad, Delhi, Bombay, Calcutta and 40 depots and C&Fs throughout India. Nutrine products are distributed through 3500 stockiest within India and reach more than 400,000 outlets throughout the country.

INDUSTRY SCENARIO
Indian v/s Global
1. India is primarily a mono pack market while the market worldwide is a multi pack market. 2. The trade is also significantly different with the global market relying heavily on organized trade. In India retail outlets like paan shops, kirana outlets result in the bulk of the sales and organized trade is still insignificant in terms of sales.

33

3. Functional products and sugar free confectionery dominate the worldwide market while that trend is yet to pick up in India. 4. The presence of unorganized players in this sector in India.

Problems faced.
A high degree of fragmentation. low margins high volumes price sensitivity high advertising expenses perishable nature of the product; India lacks a cold chain distribution network scarcity of milk rising prices lower penetration declining profits

Major Issues in recent times

In Financial Sphere: ICMA has urged Finance Minister to: Limit the maximum impact of duties and taxes on confectioneries to 12.5 per cent including excise duty of 8 per cent and other State taxes of 4 per cent. Excise duty on sugar boiled confectionery is retained at 8 per cent, but abatement (base duty charged on `MRP less abatement') be allowed at 40 per cent instead of 35 per cent now. The 16 per cent excise duty, it said, should be brought down to 8 per cent as in the case of toffees and candies. For bubble gum and chewing gum sold at 50 paisa and Re 1 per unit, the levy should be rationalized at 8 per cent, the release said. 34

According to the ICMA, the import duty on cocoa beans is fixed at the same rate applicable to that of finished chocolate products. This affects domestic manufacturers who use this as an input for value addition.

The ICMA has asked the Government to lower the duty to 20 per cent.

Steps taken.
Players like Cadbury and Nestl have also introduced chocolates in smaller packs, costing less than the regular packs to have larger penetration in the market Repositioning product as snack product for adults (e.g. Perk) Regular investigation of look alike and counterfeit products

Impact of Other Industries

Sugar Rising prices along with scarce supply becomes major issue. Milk Scarcity of milk in the nation adds up to a problem again. Cold Storage India lacks a proper cold storage chain, which hinders proper stocking of the products. Unorganized Market Indian habit of having paan as a mouth freshener instead of mint and other locally made candies poses a competition to the confectionary giants. Cannibalization within the Industry In the industry itself, chocolates vying up for small sachets pose a competition to candies etc.

COMPANY PROFILE

Background
35

Perfetti Van Melle was established in March 2001 through the merger of Perfetti S.P.A and Van Melle NV; however the two companies had been cooperating in a number of countries since 1979. Later in 1991, the common interests led Perfetti to acquire a 37% share in Van Melle, growing even stronger until in January 2001 Perfetti bought Van Melles entire shareholding. In this way two companies formed a new group that is today one of the worlds most important confectionery player. Perfetti Van Melle is a privately owned company producing and distributing candies and chewing gums in more than 130 countries worldwide. In 2003 Perfetti Van Melle achieved the third position in the global confectionery market after Cadbury and Wrigley and in Asia; PVM is the leading confectionery company in many countries. The companys head offices are located in Italy and in Netherlands.

Profile
Perfetti Van Melle, India started its operations in 1994 with a single brand Center Fresh. It leads the Indian sugar confectionery market with more than th of the value shares of the market. With a basket of 14 main brands, the company strives to leverage the international brand portfolio, while adapting flavours and blends to the local taste. The foundations on which Perfetti Van Melle, over which the company has built a success that is growing and getting stronger everyday is quality, innovation, knowledge of markets and consumer desires. Perfetti Van Melle operates with the largest distribution network among any confectionery company in India. Perfetti provides employment to over 11,600 people and operating more than 30 companies through out the world.

World- wide employment generation

36

9% 18% Asia Europe America 73%

The ability to develop products, versions and flavours that suit the different demands and opportunities of local markets is indeed one of the groups keys to success.

Perfetti has shown a tremendous growth in the sales from the past 5 years
1450 1400 In billion euro 1350 Series2 1300 1250 1200 2001 2002 2003 2004 2005

37

Net sales for 2005 were 1,434 billion euros comprising of candies and chewing gums.

38% 62%

Chewing gums Candies

Perfetti Van Melles present market position in global confectionery

Nestle Mars Hershey Perfetti Van Melle Haribo Wrigley Cadbury 0 1 2 3 4 5 Nestle Mars Hershey Perfetti Van Melle Haribo Wrigley Cadbury Sales in $bn

Vision
We will enhance our leadership in confectionery by creating value for people through delightful and imaginative high- quality products.

38

Mission
To develop, manufacture and market high- quality and innovative products for our consumers through efficient use of our resources and in partnership with our customers. To create a fulfilling workplace for our employees built on trust, mutual To value the role we play in our communities, as a socially and To create economic value through superior growth and profitability respect and appreciation of their diversity environmentally committed organization

Values
Integrity without compromise Achieving excellence Dedication to the customers Care for people Social and Environmental Responsibility Independence

Brand Portfolio
Alpenliebe (The flagship brand of PVM and a market leader) Alpenlibe Lollipop Big Babol Center fresh Center shock Chatar Patar Chlor- Mint Choco- Tella 39

 Cofitos Fruit Tella Happydent White Happydent Protex Marbles Mentos

Achievements

Perfetti Van Melle is the undisputed market leader in India Perfetti Van Melle is the third largest confectionery player in the world Perfetti Van Melle has been rated among the top 4 advertisers in the country during the ABBY Awards of 2003,2004,2005 Perfetti Van Melle has been rated by AC Neilsen among the top 10 fastest growing FMCG companies in India during 2002-2003/20032004 Over 28 million PVM India products are consumed in a day Alpenlibe was rated as one of the 150 most trusted brands in the country

40

PRODUCT AND PRODUCT MIX

Product
A product is a bundle of need-satisfying tangible and intangible attributes offered to a buyer by a seller. It is anything that can be offered to the market that might satisfy a need or want. It may be an object, a service, a place, an organization, a person or an idea. Products can be thought about at a number of levels. Every product has a basic component, known as the 'core product'. We rarely think about products only in terms of core product, however. Products have brand names, packaging, qualities and styling, for example - these make up the formal product'. Beyond the formal product is the 'augmented product', which includes warrantees, guarantees, aftersales service, installation, delivery, credit. At a final level, marketers usually perceive the product as one that will be further developed. Therefore we have the future product.

Product mix
A product mix also called product assortment is the set of all products offered for sale by an organization. The product mix includes all product lines and categories. It may be defined more narrowly in specific cases to mean only that set of products in a particular product line or a particular market. A companys product mix has a certain width, length, depth and consistency. 41

The width if the product mix refers to how many different product lines the company carries. The length of a product mix refers to the total number of items in the mix. This is obtained by dividing the total length by the number of lines. The width of a product mix refers to how many variants are offered of each product in the line. The consistency of the product mix refers to how closely related to the various product lines are in end use, production requirements, distribution channels, or some other way. Diagram for Product Mix for Perfetti Van Melle Chewies Mentos Mint Mentos Product-Mix Width Gums Candies Chloromint Alpenliebe Caramel Big Babol Happydent Centre Fresh Cofitos Choco-Tella Chloromint Chatar Patar Alpenliebe Strawberry Lollypops Alpenliebe Caramel Alpenliebe Strawberry Alpenliebe Choco

Product Line Length

Strawberry Mentos Lime Marbles Friut-Tella

These four product mix dimensions permits the company to expand its business in four ways. It can add new product lines; Lengthen each product line; Add more product variants to each product and deepen its product mix; More product line consistency.

42

PRODUCT ASSORTMENT OFFERED BY PERFETTI VAN MELLE

1) Big Babol
Soft bubble gum that comes in assorted flavours and formats. An extra ordinary product whose flavours and huge bubbles have delighted and entertained generations of kids.
Maximum Retail Price Retailer margin Retailer Cost Basic Price

Display per carton Stick Display 24 Pcs Stick Display 18 Pcs Jar150 Pcs Jar115 Pcs

24 24 16 16

144 90 150 115

18 11.74 19.57 15

126 79 131 100

106.04 66.48 110.24 106.16

2) Alpenliebe

43

Rich and genuine like its ingredients. Alpenlibe is one of the most delicious candies in Perfetti Van Melle family of products. It is as delicious as it as homemade, smooth and creamy qualities inherent in all its flavours. Alpenlibe is a small luxury with which consumers worldwide love to treat themselves whenever they seek something exceptionally tasty.
Display per carton Stick 10 Display Jar1000 Pcs Jar 275 Pcs Choco Jar 275 Pcs Pouch 165 Choco Pouch 165 Pouch 54g Lollipop 16 Hanger Lollipop House Display Lollipop 40 Pcs Jar Maximum Retail Price Retailer margin Retailer Cost Basic Price

12 4 12 12 20 20 96 16 4 12

90 500 137.50 137.50 82.50 82.50 10 96 120 80

11.74 65.22 17.93 17.93 10.76 10.76 1.30 12.52 15.65 10.43

439 122 122

66.48 369.44 102.67 102.67 60.59 60.59 7.32 70.69 88.36 58.91

3) Centre Fresh
Its the first liquid filled chewing gum in India, also PVMS first brand offering in the year 1994. Outside, it is a creamy drop. Inside, its liquid heart its fresh and delicious.
Maximum Retail Price Retailer margin Retailer Cost Basic Price

Display per carton Stick 18 Display Stick 18 Display Mono 150 Pcs Jar100 Pcs Air Action 100 pc

20 12 12 16 16

90 90 150 100 100

11.74 11.74 19.57 13.04 13.04

79 79 131 87 87

66.48 66.48 110.24 73.21 73.21

4) Centre Shock

44

Launched in 2001 in the Indian market, is a shock filled chewing gum indeed! Bite into the taste of peach, green apple, mirchi or lime blast.
Maximum Retail Price Retailer margin Retailer Cost Basic Price

Display per carton Jar 150 Jar 100 Lime blast 100

12 16 16

150 100 100

19.57 13.04 13.04

131 87 87

110.24 73.21 73.21

5) Chlormint
Available as chewing gum pellets and lozenges. Chlormint actively releases a cool and refreshing flavour that really freshens the breath.
Display per carton PCH 100 Pcs Jar 150 Pcs Jar 100 Pcs Jar 115 Pcs Jar 115 Pcs Maximum Retail Price Retailer margin Retailer Cost Basic Price

16 16 16 16 16

50.00 75.00 50.00 57.50 57.50

6.52 9.78 6.52 7.50 7.50

44.00 66.00 44.00 50.00 50.00

37.03 55.54 37.03 42.08 42.08

6) Fruit-tella
This historic brand offers all the goodness of fruits that nature has to offer for a range of high quality candies that allow children and adults to enjoy delicious and delightful sensations. Its range has been recently extended with new products for kids (jellies and lollipop) abroad and for adults (sugar-free and functional candies)

45

Display per carton Jar 150 Pcs Foot pop House Display 50 Pcs

Maximum Retail Price

Retailer margin

Retailer Cost Basic Price

16 12

75.00 100

9.78 13.04

55.54 73.21

7) HappyDent Protex
Happy Dent Protex is a sugar free chewing gum that contains Xylitol, which helps prevent tooth decay. Xylitol, is a good tasting bulk sweetener that occurs naturally in many fruits. It is also known to give cooling effect to the mouth.
Maximum Retail Price Retailer margin Retailer Cost Basic Price

Display per carton 16 blister 24 Blister Jar 100 Pcs

12 12 16

80.00 120.00 100.00

10.43 15.65 13.04

70.00 105.00 87.00

58.91 88.36 73.21

8) HappyDent White
Happy Dent White is a minty fresh chewing gum which helps keep your teeth clean and white and your breath fresh.

Display per carton Flip Top Box Flip Top(Rs 5 off)

Maximum Retail Price

Retailer margin

Retailer Cost Basic Price

12 12

120.00 115.00

15.65 15.00

105.00 100.00

88.36 88.16 46

Jar 115 Pcs(BI Pack)

16

115.00

15.00

100.00

88.16

9) Marbles
Marbles is a chewy sweet that is available in a host of yummy flavours- strawberry, mango, lime-n-lemon, orange and blackcurrant.
Maximum Retail Price Retailer margin Retailer Cost Basic Price

Display per carton Pouch-24 hanger 48 Sachet-12 hanger Sour marles-12 hanger

12 12 12

120.00 96.00 96.00

15.65 12.52 12.52

105.00 84.00 84.00

88.36 70.96 70.96

10) Mentos
A cult for entire generation of young people, Mentos is known throughout the world as the freshest mint. Mentos is a chewy dragee with an addictive taste. This irresistible round shaped candy is based on an innovative concept: crunchy and smooth outside, soft and really fresh inside. An incomparable formula that from the very outset has been a worldwide success. Available in more than 150 countries, research shows that an equivalent of approximately 45 rolls of mentos is consumed every second around the world.

47

One of the oldest Perfetti Van Melle brands, this fresh maker launched its 50 year old tradition in India with mouth watering flavours such as mint, strawberry and lime.
Maximum Retail Price Retailer margin Retailer Cost Basic Price

Display per carton Jar 300 pcs Roll Hanger Jar 165 pcs Pouch 115 Pcs Pouch 18 Pcs Stick Hanger-10 roll Mint Roll-18 Stick pack jar Lime n Lemon Jar 165

12 30 16 24 96 32 12 12 16

150.00 60.00 82.50 57.50 10.00 50.00 90.00 100.00 82.50

19.57 7.83 10.76 7.50 1.30 6.52 11.74 13.04 10.76

132.00 53.00 72.00 50.00 8.70 43.48 79.00 87.00 72.00

111.08 44.60 60.59 42.08 7.32 36.59 66.48 73.21 60.59

48

FIRST PHASE OF PROJECT: UNCONVENTIONAL MARKET

As mentioned in the report, Perfetti has a very wide distribution network covering the entire length and breadth of the country. It has a strong presence in the traditional markets of kirana stores, paan beedi outlets, canteens, etc. The modern trade also now constitutes a fair chunk of sales. However, with an increasing competition in confectionaries business like the entry of tobacco major ITC into confectionery business and the cut throat competition in snatching up the shelf space by ever increasing brand line of various companies, confectionery majors are now exploring various other avenues to increase their market share. The conventional and unconventional market for Perfetti can be ascertained by the serviceability of a particular market by the company. Hence if a market which the distribution channel of Perfetti is not serving would constitute to be an unconventional market. Since there are large number of unconventional markets, the report focuses on exploring few major unconventional markets for Perfetti like branded retail outlets, mobile service providers, cyber cafes, beauty parlours, show rooms, etc. The reasons for targeting these markets were: To attract and retain customers these branded retail outlets, showrooms etc

are looking at providing value added services to their customers. Thus giving candies, chewies to their customers as a freebie serves well for these outlets.

49

The branded retail outlets offer standardized service in every outlets, this

provides a window of opportunity for Perfetti to service an entire chain of branded outlet. The packaging and pricing of PVMs products goes well with the customer

service strategy of these outlets. Since Perfetti has a wide range of branded products, it relates well with these

branded outlets and showrooms.

FINDINGS AND SUGGESTIONS

As stated above my objective of the study was to enhance the distribution network of Perfetti Van Melle in unconventional outlets in Mumbai. The outlets that were selected for this project were, apparel showrooms, cyber cafes, toy stores, mobile service providers etc. The reason to target these outlets were The branded stores has chain of outlets, thus giving us enhanced scope of business. These branded stores and customer care galleries are conscious towards providing enhanced customer service. But the main question arising was that why outlets such as restaurants, apparel showrooms , cyber cafes, toy stores be keeping candies, chewies and gums which lies completely outside the mail line of business of such outlets ? As it is said there has to be a reason for the buyer to buy your product. And I exactly did that, brought about a reason for such outlets to keep the products of Perfetti. For the chain of branded apparel showrooms like Provogue, Levis and Lacoste etc I managed to persuade the individual store manager to keep candies like Chlormint, Alpenlibe etc on the billing counter so that when a customer who comes for 50

shopping in these outlets and when he make a purchase, he come to billing counter for payment . It usually takes some time for the bill to get processed, hence in the meanwhile the customer is offered one or two candies as complimentary item. As far as the chain of high end restaurants are concerned, the selling pitch was that after a customer has had his lunch he may like to have a candy or a chewy as a mouth freshen. Hence I made an offer to a Mars restaurant, which operates a chain of highend restaurant to keep our product at their billing counter and sell them. This would open up an added source of revenue for them. The response I got was encouraging. The following were the unconventional outlets covered by me during the course of my summer internship: Sr no. Name of outlet 1 Provouge 2 Provouge 3 Provouge 4 Provouge 5 Provouge 6 Provouge 7 Provouge 8 Provouge 9 Provouge 10 Dockers 11 Dockers 12 H20 13 H20 14 Arrow 15 Jini and jonney 16 Levis Area Colaba Type apparals DSO Nagender sharma Nagender sharma Nagender sharma Jayanta B Product sold 1.Chloromint 2.Mentos

Crossroads apparals Aitra Inorbit Malad Vashi Thane Infinity Bandra Colaba Bandra Colaba Aitra Colaba Thane Thane apparals apparals apparals apparals apparals apparals apparals apparals apparals sea derived sea derived apparals apparals apparals

Ali Azgar H Nagender sharma Ali Azgar H Nagender sharma Nagender sharma Nagender sharma Raziur rab s Raziur rab s

1.Alpenlibe, 1.Creamfills 1.Chocotella, 1.Creamfills 1.Creamfills 1.Frutella 1.Alpenlibe, 1.Alpenlibe strawberry 1. Chocotella 1.Chloromint 51

17 First beauty Mahim parlour 18 CompuSoft Mahim 19 Levis 20 Airtel 21 Provogue Mulund Parel

Beauty Parlour Cyber Caf apparals Mobile Gallery

Ankit Shah Ankit Shah

1.Mentos, 1.Coffetos 1.Happydent, 1.Coffetos 1.Alpenlibe chochlate , 1.Alpenlibe strawberry 4.Mentos Lime, 2.Coffetos, 1.Alpenlibe Strawberry1000 1.mentos jar 165 pcs

Ankit Shah

Crossroads apparals

THE SECOND PHASE OF PROJECT: STUDYING THE DISTRIBUTION CHANNEL FOR RAILWAY STATION
The next phase of my project involved studying the distribution channel of Perfetti Van Melle products for railway stations. The area covered by me included the railway stations from Nagpur up to Nashik. During the course of the project, which was a week, I covered 25 railway stations. The objective of this project was to enhance the distributional sales of Perfetti Van Melle through its dealers. At many stations the canteen owners were buying our products through wholesellers ands since the wholesellers were supplying our products to most of these stations, the dealers were suffering loss of sales from it. Hence my project involved going to a particular station and conducting a study on following grounds: Does a particular railway station have a canteen? If yes, then is the canteen an IRCTC or a private contractor. If private contractor, does he stocks our products 52

If he stocks our products, then from were he gets the supplies. If the contractor is being supplied through wholeseller, then he needs to be convinced to source our product through distributor from that area.

FINDINGS AND SUGGESTIONS

During the course of the project and the research done by me put up some interesting facts. The major railway stations like Nagpur, Bhusaval, Manmaad, Badnera have canteens that are managed by IRCTC which has its zonal offices in Bhusaval and Mumbai. These Canteens are allotted to contractors through bidding process. The contractor who manages these canteens is thus bound by the rules and regulations of IRCTC. Thus those products which are mandated by the zonal office of IRCTC are allowed to keep in these canteens. Also the contractors of these canteens are required to pay certain percentage of his sales to the zonal office. This leads to reduced margins earned by the contractors on sale through such canteens. Also at many stations, the contractor further sub contracts the selling responsibility to sales people and they earn a certain percentage of commission on sales amount. This leads to further constraints on margins earned by the contractor. Some of the findings from the study are listed below: 53

In IRCTC canteens margin is an issue for the contractors. Companies like Britannia provides margin of about 26% to these contractors whereas to other retail outlets it provides a margin of 16% Less enthusiasm to stock jars due to loss of stock by misplacement. The sales of stick product is highest in these stations. In some places like Jalgaon the contractor was not stocking our product citing railway rules and regulations which says that the canteens are only allowed to stock the products which are specified by the railways for all canteens whether IRCTC or not.

The following are the details of the railway stations covered by me during the coarse of the project:

Our Caterer Sr.No Station Name name. Stocks available Products sold
No, IRCTC canteen Nagpur Nagpur No Alpenlibe strawberry, Coffeetos

1
Ajni M/s Goyal No

2
Sewagram M/s Goyal M/s R.K.Aggarwal M/s Dolumal Tejumal No No, IRCTC canteen

3
Wardha No No, IRCTC canteen Big Babool, Coffetos, Alpenlibe

4 5

Phulgaon

No

54

Dhamangaon

M/s Mukund Rangari

Alpenlibe stick, Big Babool stick, Hypedent

6
Murtizapur M/s Anil Kanhayalal

No
Alpenlibe jar, Big Babool jar

7
Badnera M/s Latif No No, IRCTC canteen

8
Akola Satyanarayanji Pratapji No No

9
Shegaon New Railway Canteen Alpenlibe, Hypedent

10 M/s Bheese
Malkapur M/s Prabhumal Kedarmal

No Vilas No
Aplenlibe stick Alpenlibe jar, Alpenlibe strawberry, Coffetos jar, Marbles

Nandura

11

12
Bodwad No Canteen

No No No
Alpenlibe jar, Alpenlibe strawberry, Coffetos jar, Centerfruit, Centergrapes, Hypedent, Hypedent strawberry.

13

Bhusaval

M/s N.J& Sons

No

14
Jalgaon M/s S.B Wani No No

15
M/s Makhijani & Sons Alpenlibe stick, Coffeetos stick, Alpenlibe Lolipop, Marbles

Pachora Jn

16
Chalisgaon M/s B.L.Sharma

No
No

17

Bandra

No 55

Manmad

1. B.V.Balke

M/s

18
Lasalgaon M/s N.T.sharma

No
No

No
No

19

OBSERVATIONS
1. Due to the creative and effective advertising PVM has succeeded in creating a powerful brand image for its brands like Mentors, Alpenlibe, Happy dent etc. 2. The products are priced at 50 paise or Re. 1 which suites its range of customers from school going kids to adults. These affordable prices backed with effective advertisements helps in increasing the sales of its products 3. The distribution network of Perfetti Van Melle is quite effective as well. The division of its products into categories of P1, P2 and P3 forms the basis of division of distributors as well and each distributor can take the distribution rights of any one of the product categories. Weekly visits by the salesmen to the retailer enhanced the network. 4. The market of unconventional outlets for Perfetti has a huge scope for further growth as outlets like mobile service providers or branded showrooms wont mind spending such small amount of money, which in turn provides satisfaction to their customers. 5. In case of railways, most big stations have canteens managed by IRCTC. PVM products are not being sold in these canteens; hence the company can look at this avenue for enhancing its sale. 56

RECOMMENDATIONS
Following are some of the recommendations for the company, which may prove useful: 1) Though the companys advertisements have proved quite effective in boosting up the sales, which mostly concentrated on visual media such as in the form of TV commercials. PVM can also explore the opportunity of putting up advertisement in regional channels to reach wider rural customers. 2) The company should consider unconventional market as great avenue for enhancing sales, sustaining brand recall and promotion for the unconventional markets. The company in case of unconventional outlets should have a separate team or department taking charge of only such outlets like they have in case of modern trade that is departmental stores, super markets, hypermarkets etc. 3) Until now only ice creams are being sold to consumers through salesmen on tricycles as seen outside schools, colleges etc so even Perfetti could try out this option and be the first confectionery company to do so. 57

4) Unconventional market is not only for sales, but its provide great avenue for advertisements and publicity, where in when Reliance webworld, or Airtel customer service office offers Apenlibe or Cloromint he offering a complementary token. And this token helps in brand recall when the father or mother buys the same alpenlibe at the retail outlet for his son and he remembers he got this candy as token from reliance. Therefore its imperative to offer more discounts 15% + Tie up + 5% extra to reliance and unconventional market.

BIBLIOGRAPHY
Interview with Mr. Vivek Chopra National Sales Manager (Loreal) Interview with Mr. Deepak Vajirani Purchase Manager (Kaya Clinic) Interview with Mr. Amit Goyal Web World Manager (Reliance Infocomm) Interview with Mr. Chaitanya Bharadwaj Marketing Manager (Planet M) Interview with Mr. Satyem Milwani Assistant Marketing Manager (Mars Restaurants) Interview with Mr. Parag -store manager (Arrow) Interview with Mr. Rajendra stores manager (Dockers) Interviews with canteen owners at various railway stations in Maharahstra. 58

Interview with Distributors www.cii.com www.ficci.com www.perfettivanmelle.in www.ibef.org

59