Arvind Company LtdAkola, Maharashtra MTS -1 Project title Market Research for Organic Staple Business in Domestic and Global for Arvind ltd. Presented by: Anjaney Kumar(10201006) Sunil Kumar(10201055) 1
Arvind Ltd.wasestablished in 1931,company of Lalbhai Group
It is India's largest Denim manufacturer apart from being world’s fourth-largest producer and exporter of Denim .
Today it not only retails its own brands like Flying Machine, Newport and Excalibur but also licensed international brands like Arrow, Lee, Wrangler and Tommy Hilfiger, through its nationwide retail network.
Arvind also runs a value retail chain, Mega mart, which stocks company brands.
Recently it has launched BCI and Organic Staple food projects in Akola district. Arvind is working closely with the farmers of the Vidarbha region in Akola to grow organic cotton and staple food like Moong, Pigeon pea, Black gram, Soybean, sunflower, Sorghum, Ajwain etc
Significance of the study: The significance of the study is to find the suitable market for organic food and to make strategic formulation for the business of organic food so that marketing of the organic food can run in a sustainable manner and producer can get better return through the business 3
Center wise SHGs & farmers Classification of farmers ARVIND ORGANIC PROJECT EXTERNAL CERTIFICATE (CUC) EXTENSION SERVICE INTERNAL MONITORING FARMERS FARMERS FARMERS Source: field survey Organic (ICS) Structure & Certification All 3538 farmers have been in organic status
field survey ,primary data collection.xlsx
Objective 02 Domestic and Global Scenario Domestic Demand of organic food in India 8 Source: APEDA
Conti… Distribution of organic land world wide(2009)* Development of organic land from 1999-2009(M .Hac.) * World Market for Organic Foods: 2001 – 2011 US $ mln Source *: FiBL Source: USDA 10
USA EU countries The United States organic food market grew by 15% in 2010 to reach a value of $28,513.1 million . In 2015, the United States organic food market is forecast to have a value of $ 42,531.8 million, an increase of 49.2% since 2010 The European organic food market grew by 9.9% in 2010 to reach a value of $25,040.3 million. In 2015, the European organic food market is forecast to have a value of $36,382 million, an increase of 45.3% since 2010. 11
Objective :3 Marketing Strategy Value chain Harvesting Selling at farm Procuring /collecting Storing Packaging Storing in warehouse Cleaning ,Grading and Storing Stretching /Labeling Domestic : Distributor /wholesaler Organic Retail outlet /Mall Domestic Selling Global Global : Exporter/Export 12
Marketing StrategyChannel Producer Procurement Center Processing Warehouse Export Exporter Distributor/Supplier Organic retail/mall Domestic Global 13
4ps Model For Marketing Strategy PRODUCT STRATEGY PRICE STRATEGY Offering Vast range of organic food products with high qualities . Purely organic certified under internal inspection with control union certification (NETHARLAND). .The quality control systems are such that the products are checked and rechecked right from the field, grading and packing and during shipment, which makes it possible to meet the high quality standards of Europe and other developed nations Producer: small holder associated with SHGs Country of origin : India Packaging: 50 kg wrapped in jute bag, labeled with private organic logo. provision for Cost plus price: total cost from farm to the market plus 10%profit margin for export market, and for domestic business we work through market penetration by offering minimum price of the product for long term business growth .and also for market sustainability. Competitive price at highest quality . Price differentiation discount based on volumes,rediness to inter long term partnership. 14
CONTI…. PLACE PROMOTION Direct shipping to the EUs and USA countries to the wholesaler & distributor . Or via exporter At Domestic level business, Small as well as big volume directly sold to the distributor ,organic retail outlet and mall . Personal selling :getting in contact with potentially interested final distributor /wholesaler Participation in organic and fair-trade fair Inviting potential client to the field visit Promotional material(pamphlet) for clients and consumer After sales follow-up client satisfaction and distributor satisfaction For domestic level promotion we will use electronic media and print media. We also promote mouth to mouth promotion by offering best quality of products at low price. 15
Lack of universal certifying standard are the major problems for business at global level
Organic demand in India in year 2010 8,423.843 US $ million forecasted to reach 12,192.130 US $ million in year 2014.
The European organic food market grew by 9.9% in 2010 to reach a value of $25,040.3 million. In 2015, the European organic food market is forecast to have a value of $36,382 million, an increase of 45.3% since 2010.
The United States organic food market grew by 15% in 2010 to reach a value of $28,513.1 million . In 2015, the United States organic food market is forecast to have a value of $ 42,531.8 million, an increase of 49.2% since 2010
Business is viable in sense of profitability for the company
Lowers operational costs, could offer discounts to customer for using Arvind organic food brand products.
SHGs should be registered Warehouse registration is necessary and location of warehouse should be near by market and pure hygienic storage condition should be maintained. Advertisement through print as well as electronic media is important. Market linkage for domestic as well as global business through third parties (distributor and exporter). 19
LESSON LEARNT Focus of the project was to link the export as well as domestic market through Middlemen ( exporter and distributor). Government should act like facilitator and promoter of organic agriculture. Capacity Building of farmers at farm level is major success factor for organic farming. Farmers market linkage during IC1 and IC2 WIN – WIN situation should be there for every stakeholders. Evaluation of any organic project should be based on:
Strict internal as well as external certification monitoring are necessary to ensure 100% organic. For storing organic staple food in warehouse optimal conditions are required depending upon the staple food. For organic staple Business quality and certification standard should be assured. Corporate work culture . 20