1. HALIDRAM’S ANALYSIS This document is an
FOR E-COMMERCE
analysis of the sweet
and namkeen shop
haldiram, and how e
commerce activity in
the company will
A Document by: Vishakha Chopra and
contribute to its
Abhishek Kumar enhancement

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Contents
Executive Summary ................................................................................................... 3
Market Analysis : HALDIRAM‟S............................................................................... 4
Background……………………………………………………………………………………………….4
Marketing Mix (4P Analysis)………………………………………………………………………6
Products ............................................................................................................. 6
Pricing ................................................................................................................ 7
Place ................................................................................................................... 8
Promotion .......................................................................................................... 8
SWOT Analysis…………………………………………………………………………………………10
Porter‟s Five Forces Model Analysis……………………………………………………………11
1) Threat of Intense Segment Rivalry (Industry Competitors) ........................ 11
2) Threat of New Entrants ................................................................................ 11
3) Threat of Substitute Products ...................................................................... 11
4) Threat of Buyer‟s Growing Bargaining Power .............................................12
5) Threat of Supplier‟s Growing Bargaining Power .........................................12
Competitors of Haldiram‟s (in Namkeen Segment) ................................................13
Levels of Competition………………………………………………………………………………. 13
A. Brand Competition ....................................................................................... 13
B. Industry Competition: ..................................................................................14
C. Form Competition: .......................................................................................14
D. Generic competition .....................................................................................14
E-commerce Rationale ............................................................................................. 15
1. Easy reach to a fast growing online community ........................................ 15
2. Reduces Costs for Inventory Management ............................................. 15
3. Reaching Global Market ..........................................................................16

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4. Monitoring the Consumers‟ Buying Habit and Interest .........................16
5. Reduces Costs To Establish Store Front .................................................16
6. Reduce Advertising Costs ........................................................................16
7. Faster buying/selling procedure, as well as easy to find products. ........16
8. E-commerce serves as an “equalizer” .....................................................16
9. E-commerce makes “mass customization” possible ............................... 17
10. E-commerce allows “network production.” ............................................ 17
11. Reduced costs .......................................................................................... 17
12. Improved customer service ..................................................................... 17
E-commerce critique and recommendations ..........................................................19
Site analysis of the company………………………………………………………………………19
Recommendations for E-commerce activity : ........................................................ 20
Phase 1: Identify the business opportunity ..................................................... 20
Phase 2: Select the technology infrastructure ................................................. 20
Phase 3: Implement the electronic business solution ..................................... 20
Build Trust and customer loyality : ............................................................21
Provide Added Value ..................................................................................21
Give Customers a Choice ............................................................................21
Transaction Software ..................................................................................21
Site Maintenance ........................................................................................21
Security .......................................................................................................21
Conclusion ............................................................................................................... 22
References ............................................................................................................... 23

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Executive Summary
This project has been taken up to study a B2C (Business to consumer) company
which does not have practice e-commerce as its major business transaction.
Haldiram's is one of India's largest sweets and snacks manufacturers, based
in Delhi, India. Having become a house-hold name already, Haldiram‟s offers an
assortment of products, packed sweets and confectionaries being their niche
products. The brand boasts of exporting its products to USA and other countries
with strong Indian diaspora and over the time has opened flagship stores all over
the world including Canada, Australia and several European countries.
Haldiram‟s story presents the perfect case of coming of age of a small-time
business and adopting to the changing tides of time, having redefined its business
model over and over again to keep up with the changing market dynamics and
consumer behaviour. Thus adopting Haldiram‟s for this study seems to be highly
suitable.
For this purpose our group has selected Haldiram‟s brand, which is the market
leader of its segment in India, but still does not have a web-page where consumers
can go and make purchase electronically.
The methodology used in this study is to make an analysis of the company and
then gradually move on to other aspects such as various benefits and scopes of
implementation of the e-commerce practices.

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Market Analysis : HALDIRAM’S
BACKGROUND
In 1937, Ganga BishenAgarwal, (popularly known as Haldiram), opened a
small sweet shop in Bikaner, a small district in Rajasthan. Bikaner had a
large number of sweet shops selling sweets as well as namkeens.
'Bhujiasev,' a salty snack prepared by Ganga Bishen, was very popular
among the residents of Bikaner and was also purchased by tourists coming
to Bikaner. In 1941, the name 'Haldiram'sBhujiawala' was used for the first
time.
In 1950, Prabhu Shankar Agarwal (Prabhu), along with his father
RameshwarLalAgarwal (son of Ganga Bishen), expanded the business by
establishing a small manufacturing unit for sweets and namkeens in
Kolkata. The success of this unit motivated Prabhu to upgrade its
machinery to improve the quality of its products.
As demand for Haldiram's products increased, it was decided to scale up
the company's manufacturing and distribution activities. In 1970, a large
manufacturing unit was set up in Nagpur in the state of Maharashtra
(India). In 1983, a retail outlet was set up in New Delhi. The outlet became
very popular not only among the Delhiites but also among tourists visiting
Delhi.
Haldiram's was able to achieve significant growth during the 1980s and
1990s. In 1992, a manufacturing unit with a retail outlet attached to it was
set up in the outskirts of Delhi. A year later, Haldiram's syrups and crushes
were successfully launched in the Indian market. In 1995, a restaurant was

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opened in New Delhi. In 1997, realizing the potential of namkeens, the
company set up a manufacturing unit in Delhi exclusively for making
namkeens. To add potato products to its existing product portfolio,
machinery was imported from the US. Haldiram's maintained high quality
standards at every stage of the production process. All its food items were
prepared and packaged in a very hygienic environment.
In the mid 1990s, Haldiram' s added bakery items, dairy products, sharbats
and ice creams to its portfolio. At the beginning of the 21st century,
Haldiram's products reached millions of consumers not only in India, but
also in several other countries, including the US, Canada, UK, UAE,
Australia, New Zealand, Sri Lanka, Nepal, Japan and Thailand.
Analysts felt that the growing popularity of Haldiram's products could be
attributed to its constant focus on all the elements of the marketing mix. An
article posted on the APEDA's website - apeda.com quoted some of the
company's strengths, "To sustain in the competitive market, Haldiram's has
endeavored stress on its product quality, packaging, shelf life, competitive
price with a special emphasis on consumers satisfaction and its lingering
taste is amongst the best available in the world."

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MARKETING MIX (4P ANALYSIS)
Products Pricing
Place Promotion
Products
Haldiram's offered a wide range of products to its customers. The product range
included namkeens, sweets, sharbats, bakery items, dairy products, papad and ice-
creams. However, namkeens remained the main focus area for the group
contributing close to 60% of its total revenues. By specializing in the
manufacturing of namkeens, the company seemed to have created a niche market.
While the Nagpur unit manufactured 51 different varieties of namkeens, the
Kolkata unit manufactured 37 and the Delhi unit 25. The raw materials used to
prepare namkeens were of best quality and were sourced from all over India.
Haldiram's sought to customize its products to suit the tastes and preferences of
customers from different parts of India. It launched products, which catered to the
tastes of people belonging to specific regions. For example, it launched
'Murukkus,' a South Indian snack, and 'Chennai Mixture' for south Indian
customers. Similarly, Haldiram's launched 'Bhelpuri,' keeping in mind customers
residing in western India. The company offered certain products such as
'Nazarana,' 'Panchratan,' and 'Premium' only during the festival season in gift

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packs. These measures helped Haldiram's compete effectively in a market that was
flooded with a variety of snack items in different shapes, sizes and flavours.
Pricing
Haldiram's offered its products at competitive prices in order to penetrate the
huge unorganized market of namkeens and sweets. The company's pricing
strategy took into consideration the price conscious nature of consumers in India.
Haldiram's launched namkeens in small packets of 30 grams, priced as low as
Rs.5. The company also launched namkeens in five different packs with prices
varying according to their weights. The prices also varied on the basis of the type
of namkeens and the raw materials used to manufacture it. The cost of metallized
packing also had an impact on the price, especially in the case of snack foods. The
company revised the prices of its products upwards only when there was a steep
increase in the raw material costs or additional taxes were imposed. The company
also launched namkeens in five different packs with prices varying according to
their weights. The prices also varied on the basis of the type of namkeens and the
raw materials used to manufacture it. The cost of metallized packing also had an
impact on the price, especially in the case of snack foods. The company revised the
prices of its products upwards only when there was a steep increase in the raw
material costs or additional taxes were imposed.
Pack Weight Price (In Rs)
30 gms 5
85 gms 10
180-250 gms 18-35
400-500 gms 40-70
1 kg 95-200
Generalised pricing of „Namkeens‟

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Place
Haldiram's developed a strong distribution network to ensure the widest possible
reach for its products in India as well as overseas. From the manufacturing unit,
the company's finished goods were passed on to carrying and forwarding (C&F)
agents. One Indian unit had 25 C&F agents and 375 distributors while Haldiram
had 35 sole distributors in the international market. The Delhi and Nagpur units
together catered to 0.6 million retail outlets in India. C&F agents received a
commission of around 5%, while distributors earned margins ranging from 8% to
10%.The retail outlets earned margins ranging from 14% to 30%. At the retail
outlet level, margins varied according to the weight of packs sold. Retailers earned
more margins ranging from 25% to 30% by selling 30 gms pouches (priced at
Rs.5) compared to the packs of higher weights. Apart from the exclusive
showrooms owned by Haldiram's, the company offered its products through retail
outlets such as supermarkets, sweet shops, provision stores, bakeries and ice
cream parlours. Haldiram's products enjoyed phenomenal goodwill and stockists
competed with each other to stock its products. Moreover, sweet shops and
bakeries stocked Haldiram's products despite the fact that their company's
products were competing with these products. Haldiram's also offered its products
through the Internet. The company tied up with indiatimes.com, a website owned
by the Times of India group to sell its products over the Internet.Giftstoindia.com,
giftssmashhits.com, tohfatoindia.com and channelindia.com enabled people
residing abroad to send Haldiram's gift packs to specified locations in India.
Region-specific websites enabled people to send gifts to specified regions.
Promotion
Haldiram's product promotion had been low key until competition intensified in
the snack foods market. The company tied with 'Profile Advertising' for promoting
its products. Consequently, attractive posters, brochures and mailers were
designed to enhance the visibility of the Haldiram's brand. Different varieties of
posters were designed to appeal to the masses.

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The punch line for Haldiram's products was, 'Always in good taste'
Advertisements depicting the entire range of Haldiram's sweets and namkeens
were published in the print media (magazines and newspapers).
These advertisements had captions such as 'millions of tongues can't go wrong'
'What are you waiting for, Diwali?' and 'Keeping your taste buds on their toes'. To
increase the visibility of the Haldiram's brand, the company placed its hoardings
in high traffic areas such as train stations and bus stations. Posters were designed
for display on public transport vehicles such as buses, and hoardings, focused on
individual products were developed.
Captions such as 'yeh corn hain' (this is corn), 'chota samosa – big mazaa' (small
samosa – big entertainment), 'yeh Kashmiri mix khoobjamega' (this namkeen
item will gel well) and 'oozing with taste' (for Rasgoolas) promoted individual
products.
For those customers who wanted to know more about Haldiram's products,
special brochures were designed which described the products and gave
information about the ingredients used to make it.
Mailers were also sent to loyal customers and important corporate clients as a
token of appreciation for their patronage.
Packaging was an important aspect of Haldiram's product promotion. Since
namkeens were impulse purchase items, attractive packaging in different colours
influenced purchases. Haldiram's used the latest technology (food items were
packed in nitrogen filled pouches) to increase the shelf life of its products.
While the normal shelf life of similar products was under a week, the shelf life of
Haldiram's products was about six months. The company projected the shelf life
of its products as its unique selling proposition. Posters highlighting the shelf life
of its products carried the caption 'six months on the shelf and six seconds in your
mouth.' During festival season, Haldiram's products are sold in attractive looking
special gift packs.

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SWOT ANALYSIS
• Brand awareness and visibility, market leader of the
segement
• Variety of products like papads, namkeens, cookies,
chips, sweets, sherbets, dry fruits, etc
• Trusted for quality and hygiene
• Attractive and efficient packaging
Strength • Good supply chain ensuring availability of products
• Aptly priced for the customers
• Loved for its taste
• Exported to many countries
• High Market share
• Availability of brand almost on all the outlets
• Consumer proximity to retail outlet.
• Sale pushing of other brands
• Schemes given to retailer are not enough.
Weakness • Less profit of margin of Haldiram product from other brand.
• Less advertisement
• Increase its reach in India and abroad
• Expand the hotel business
Increase the number of outlets
Opportunity • Agrresively advertise and promote the brand
• Introduce healthy snacks like fat free, low calories and
baked
• Innovate by introducing snacks catering to the youth
• Customers are inclined towards western ways, and are not
Threat interested in Indian snacks
• Indian snacks are considered unhealthy
• Increased competition from other brands and local players

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PORTER’S FIVE FORCES MODEL
ANALYSIS
Porter‟s five forces determine the intrinsic long-run profit attractiveness of a
market or a market segment. The following is the analysis of this model with
respect to Haldiram‟s:
1) Threat of Intense Segment Rivalry (Industry Competitors)
Haldiram‟s did not face any intense segment rivalry in the initial stages and some
time after that, but the last few years have seen a lot of players entering the
namkeens/snack food segment. This has led to various new products being
introduced by all. Variety and higher quality standards have been set & the
companies are competing with each other to grab a larger market share in this
segment and hence there is evident segment rivalry. The primary and potential
threat that appears to Haldiram‟s is from the unorganized segment with its lower
pricing and variety in the products.
2) Threat of New Entrants
There is a threat of new entrants especially from the unorganized sector that has
lesser quality pressures. The entry and exit barriers are both low leading to stable
returns, therefore big companies may enter this segment looking for a quick
profit.
3) Threat of Substitute Products
Threat of substitute products arises from the ability of the consumer to substitute
namkeensby other things that suit him. For example ice creams, biscuits, bakery
products. Like wise and outing for burger and other fast food items may also
substitute for namkeens. The players have to monitor prices closely as a fall in the
prices of these substitute products may lead to a price cut in the namkeensegment
as well.

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4) Threat of Buyer’s Growing Bargaining Power
There‟s no threat of buyers‟ growing bargaining power, as it doesn‟t represent a
significant portion of the buyers‟ cost. The buyers do not seem to be very price
sensitive and nor are they more concentrated (buyers are distributed across a wide
geographical region in the country) or organized.
5) Threat of Supplier’s Growing Bargaining Power
Suppliers are unorganized and there are a lot of substitutes available to the
company. Moreover the number of suppliers being large and the size of the
suppliers being very small as compared to the company, the company is in a
strong bargaining position. Hence there is no such threat of suppliers‟ growing
bargaining power.

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Competitors of Haldiram’s (in
Namkeen Segment)
The following are the major competitors of Haldiram‟s:
Frito Lays
Bikano
MTR
Unorganized Sector
However the comparison is restricted to Frito Lays, as this is the closest
competitor ofHaldiram‟s.
LEVELS OF COMPETITION
This analysis covers all four levels of competition for Haldiram‟s: Brand, Industry,
Brand Bikano, Frito Lays, MTR, Lehar,
UnorganizedSector
Industry Differentiated Oligopoly
Form Traditional snacks like Samosa, Kachori, etc.,Burgers, Pizzas, Salty
Biscuits, Bakery Items
Generic Any product competing for the same of amountconsumer dollars
A. Brand Competition
Brand Competition includes other companies offering similar products and
services tothe same customers at similar prices. Here, the brand competition
would be all thecompanies selling Namkeensalong the same lines as Haldiram‟s.
Because of thisbrands like Bikano, Frito Lays, etc… and the unorganized sector are
considered asbrand competitors.

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B. Industry Competition:
The namkeensindustry is essentially made up of a few players producing the
sameproduct partially differentiated along the lines of quality, styling and
services. Thismeans that the namkeensindustry follows the pattern of
„Differentiated Oligopoly‟.
C. Form Competition:
Form competition essentially means that competitors who produce products
thatsupply the same service. In case of Haldiram‟sNamkeens, it faces stiff
competitionfrom traditional snacks like samosas, kachorisetc. and others like
salty biscuits,pizzas, burger and bakery items as people tend to substitute
namkeensvery easily with these products.
D. Generic competition
Generic competition essentially includes those companies competing for the
sameamount consumer money. In case of Haldiram‟s, it includes all edible
products in thesame price range

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E-commerce Rationale
While e-commerce certainly seems to be in vogue and the new way of doing
business, its hardly a reason sufficient enough to jump the e-commerce bandwagon.
Every organization would rather weigh its options before deciding to adopt e-
commerce and will embrace it only if the organization finds it feasible, lucrative and
ample profit-making scope.Hence, in this section we discuss several benefits an
organisation like Haldiram‟s would be able to reap by adopting e-commerce.
1. Easy reach to a fast growing online community
Developing economies such as India and other developed economies such as
American and European have registered exponential growth of internet user.
Majority of these user are from the youngsters and socially upward growing section,
which is the cutomer group known for experimenting new products and looking for
novelty in the services. Hence in order to harness this new and emerging section of
users e-commerce is the perfect tool. Electronic commerce enables people in Third
World countries and rural areas to enjoy products and services that otherwise are
not available to them
2. Reduces Costs for Inventory Management
With e-commerce, the suppliers can reduce costs to manage their inventory of goods
because they can automate the inventory management using web-based
management systems. This method indirectly can save their operational
costs. Electronic commerce decreases the cost of creating, processing, distributing,
storing, and retrieving paper-based information. For example, by introducing an
electronic procurement system, companies can cut the purchasing administrative
costs by as much as 85 percent. The daily production involves maintaining,
organizing, and accounting for product inventory. Operational benefits are realized
when the inventory control processes are made simpler or eliminated and at the
same time are able to handle inventory thus ensuring that there will be no large
stockpiles of inventory, while simultaneously reducing out of stock situations.

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3. Reaching Global Market
E-commerce allows the suppliers to reach global market segment. In other words, it
allows the suppliers to increase their sales meanwhile decrease the investment costs.
Electronic commerce expands the marketplace to national and international
markets. With minimal capital outlay, a company can easily and quickly locate more
customers, the best suppliers, and the most suitable business partners worldwide.
4. Monitoring the Consumers’ Buying Habit and Interest
The suppliers can monitor the consumers‟ buying habits and interests so that they
can tailors their offer suit to consumers‟ needs and keep the on-going relationship
with them.
5. Reduces Costs To Establish Store Front
The overhead costs to build the physical store front may be prevented to the
suppliers who use e-commerce as their business operation.
6. Reduce Advertising Costs
E-commerce can reduce advertising costs because it is easier to update the
advertisement using software technology.
7. Faster buying/selling procedure, as well as easy to find
products.Customers can easily select products from different providers without
moving around physically. Electronic commerce provides customers with more
choices; they can select Electronic commerce frequently provides customers with
less expensive products and services by allowing them to shop in many places and
conduct quick comparisons.
8. E-commerce serves as an “equalizer”
It enables start-up and small- and medium-sized enterprises to reach the global
market.

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9. E-commerce makes “mass customization” possible
E-commerce applications in this area include easy-to-use ordering systems that
allow customers to choose and order products according to their personal and
unique specifications. For instance, a car manufacturing company with an e-
commerce strategy allowing for online orders can have new cars built within a few
days (instead of the several weeks it currently takes to build a new vehicle) based on
customer‟s specifications. This can work more effectively if a company‟s
manufacturing process is advanced and integrated into the ordering system.
10. E-commerce allows “network production.”
This refers to the parceling out of the production process to contractors who are
geographically dispersed but who are connected to each other via computer
networks. The benefits of network production include: reduction in costs, more
strategic target marketing, and the facilitation of selling add-on products, services,
and new systems when they are needed. With network production, a company can
assign tasks within its non-core competencies to factories all over the world that
specialize in such tasks.
11. Reduced costs
The costs experienced by organizations in their daily business operations from
paperwork, paying bills and making products or delivering services are largely
reduced due to the automation processes of e-commerce applications. These include
operational costs, administrative costs, and transaction costs. Operational benefits
are realized when the total costs after e-commerce adoption are lower than the costs
of operating the business before adopting e-commerce. Internet is an inexpensive,
flexible, and efficient means for businesses to trade and communicate.
12. Improved customer service
Improved customer service refers to the quality of tasks that an organization
performs to increase sales, retain its customers and improve the quality of services
provided. A relationship related benefit is perceived if the level of satisfaction the
customer (business or individual) experiences from conducting business with the

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organization is raised after e-commerce adoption. This in turn increases the
customer‟s loyalty and purchasing behaviors. The degree to which the perceived
service meets the customer expectations related to the service quality, that will in
turn determine the customers satisfaction reflected in their trusting beliefs.

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E-commerce critique and
recommendations
SITE ANALYSIS OF THE COMPANY
Haldiram‟s has its own web-site which serves as information source for the
company‟s line of products and other organizational information.

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Recommendations for E-commerce
activity :
In the successful implementation of electronic business, many factors are
involved. The approach of using of an electronic business consists of the
following three phases:
Phase 1: Identify the business opportunity
Determining where the organization falls in the matrix of electronic business. Use
of a matrix can also identify the kinds of technology and business partners, which
can help the organization to achieve its goals.
Phase 2: Select the technology infrastructure
Different electronic business opportunities demand different technology
solutions. After identifying the business opportunity, the next step is to look for
places where an organization can capitalize on its existing technology
infrastructure. For example, a tool that can enable web applications would require
network bandwidth, computer security, and applications to make electronic
business a reality.
Phase 3: Implement the electronic business solution
This phase involves complex technology and organization issues. It is important to
make sure that a solution is tightly integrated with other systems and operations.
The implementation also needs to have the partners, customers, suppliers, and
employees built into it.

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In order to build a successful e-commerce venture following
OBJECTIVES shall be met :
Build Trust and customer loyality :To build customer loyalty,
an organization must first build trust. The organization should be open,
honest, clear, and concise in terms of letting the customer know what it
will do or will not do.
Provide Added Value: The organization should provide added
value, which actually makes the customer‟s demand and expectations
Give Customers a Choice: The organizations should make sure
that the customers are given enough choices and are allowed to make
decisions themselves.
Transaction Software:The transaction and payment software must
perform correct calculations, especially with respect to taxes and shipping
costs.
Site Maintenance:The organizations should have enough trained
programmers to maintain the web site.
Security: Details regarding personal information and data regarding
electronic money transactions must be highly secure

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Conclusion
The ecommerce brings the shopping experience to the consumer‟s home. By
launching a B2C ecommerce website, the manufacturers‟ bring the convenience
and comfort of shopping to the consumers thereby increasing their prospective
customers. When the manufacturer owns the retailing operations also, it can
create brand awareness more prominently. By reaching out to new markets the
manufacturers can increase their business‟s brand name and about their product
line. The e-shopping is accessible from anywhere anytime, thus it proves to be a
quick and easy mode of providing information. Manufacturers can provide
extensive updated information of their product range through their customized
ecommerce website design.
Moving to eBusiness can lead to low operational costs for manufacturers. B2C
ecommerce website reduces the costs of running their business by less staffing,
physical infrastructure, maintenance etc. A B2C ecommerce website is the sure
way to leverage the internet for increased efficiency, reduced operating costs, and
maximum return on investment for any manufacturing business. Manufacturers
can directly open a dedicated channel to service the end customers by having an
own B2C ecommerce website. This reduces the dependency on retail or channel
partners, leading to costs benefits.
An online ecommerce website can help Business in establishing new opportunities
and relationships with potential customers, business associates. Owning a B2C
ecommerce website makes it easier for the manufacturer to target smaller
consumer and niche markets for his products

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References
www.haldirams.com
www.cii.gov.in
https://domino.fov.uni-mb.si/proceedings.nsf/
www.google.com