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Britannia's 100-Year Legacy in India's Food Industry
- 1. BRITANNIA Sonali Kumari (0090) Avinash Gaurav (0076) Ayush Sharma (0077) Ishan Dwivedi (0079) By Group 4 RM 09 To Dr. Gautam Sadhu
- 2. INTRODUCTION • India’s leading food companies with a 100-year legacy and annual revenues more than Rs. 9000 Cr. • Britannia products are available across the country in close to 5 million retail outlets and reach over 50% of Indian homes. • Britannia Industries was established in 1892 by a group of British businessmen with an investment of ₹295. • In 1918, C.H. Holmes, an English businessman based in Kolkata, was taken on as a partner and The Britannia Biscuit Company Limited (BBCo) was launched • Biscuits were in high demand during World War II and company’s name was changed to the current "Britannia Industries Limited" in 1979. • In 1982, the American company Nabisco Brands, Inc. acquired the parent of Peek Freans and became a major foreign shareholder.
- 3. Vision To dominate the food and beverage market in India with a distinctive range of “Tasty Yet Healthy” Britannia brands
- 4. Mission To dominate the food and beverage market in India through a profitable range of “Tasty yet Healthy” products by making every Indian a Britannia consumer.
- 5. Sub-Products Dairy The company’s Dairy business contributes close to 5 per cent of revenue and Britannia dairy products directly reach 100,000 outlets. Examples- Cheese, Fresh dairy Breads Britannia Bread is the largest brand in the organized bread market with an annual turnover of over 1 lac tons in volume and Rs.450 crores in value. Examples- Whole Wheat Breads, White Sandwich Breads, Bread Assortment, Daily Bread Biscuits Examples- Good Day, Crackers, Nutri Choice, Marie Gold, Tiger, Milk Bikis, Bourbon, Little Hearts, Pure Magic, Nice Time Cookies Cakes Examples- Bar Cakes, Veg Cakes, Chunk Cakes, Nut And Raisin Romance, Muffills, Biscotti Rusk Example- Premium Bake
- 6. MAJOR COMPETITORS Britannia Parle ITC Priya Gold Others Motilal Oswal Survey Report March 2012 33%
- 7. STAKEHOLDERS • Customers • Employees • Government • Investors • Promoters • Suppliers • Creditors • Unions • Media • Community • Bank • Natural Environment • Distributor • Brand Ambassador • Management • Competitors
- 8. Pros & Cons Positive • Employee • Investor • Promoter/Owner • Distributor • Creditor • Bank • Supplier • Brand Ambassador • Management Negative • Government • Natural Environment • Competitor • Union
- 9. Pros & Cons Change in the Climatic Conditions Climate plays an important role in the agriculture process. The change in the rainfall pattern has been a matter of concern now in India. The agriculture sector in areas which are monsoon dependent suffered badly due to the change in the rainfall pattern. Example - materials suppliers, which will effect the distributor Exemption on Customs Duty on Sugar Raw Material Import by government If to the shortage in the production of sugar the deadline for the exemption on customs duty on raw sugar imports Example- Import duty been extended by the government which will increase the product price its will effect the customer
- 10. Primary & Secondary Primary • Customers • Employees • Investors • Promoters • Suppliers • Community • Distributor • Management Secondary • Government • Creditors • Unions • Media • Brand Ambassador • Competitor • Bank
- 11. C (Influence low- Importance low) • Unions D (Influence high- Importance low) • Government • Creditors • Media • Brand Ambassador • Competitor B (Influence high- Importance high) • Customers • Investors • Promoters • Community • Distributor • Management A (Influence low- Importance high) • Employees • Suppliers • Banks
- 12. Problem • Lower market share in dairy segment • Heavy expenditure on advertising and marketing • Customer complaints takes more days to resolve • High brand switching • No overseas presence • Low profit margin in biscuit segments • Depends on stores and retailers
- 13. Causes • Local dairies and bakeries • Conventional style of marketing with celebrities • Not focused on customer grievances • Lower price offering competitors • Covid • Rise in cost of raw materials and operational cost • Distributors are the only revenue generators
- 14. Effects • Unable to concentrate on diary product segment • Missing out on Influencer Campaigning • Customer base is reducing • Low penetration in Rural Area • Inflation • Over dependency on the biscuit • Unable to make presence in an online market
- 15. Increase Dairy Segment Resolving Problem Scaling Business Focusing on Premium Products Reducing Conventional Marketing Shifting dependency from distributors Gain more market Risk distribution Increase their reach Customer Retention Increase in Revenue Increase in Profits OBJECTIVES RESULTS
- 16. SEGMENTATION Lower To target the price sensitive customers, the company has introduced biscuits that provide them value for money and have nutritional value. Examples Tiger, Milk Bikis Middle The company has a range of biscuits that lie in the mid segment that are light and include both sweet and salty variety. Examples- 50-50, Marie Gold, Time Pass, Little Hearts, Nice Time. Premium The premium segment offers biscuits that have more to them in addition to the taste and value for money. They offer a wide assortment of biscuits with dry fruits and different cream flavours. Examples- Good Day, Treat, Nutri Choice Digestive Products Price Good Day 20 Marie Gold 10 Nutri Choice 20 Tiger 10 Milk Bikis 10 Treat 35 Bour Bon 30 Little Hearts 10 Pure Magic 30 Nice Time 25
- 17. PESTEL Analysis Political • Custom duty on sugar • Implementation Of GST • Demonetization • Import duty in diary product • Incentives to Build Cold Storage Facilities • VAT on Biscuits Economic • Unavailability of Logistics • Sudden increase in the demand of the product during Covid 19 lockdown • Globalization Social • Level of education • Population density affect the consumer lifestyle • Children have the power to influence their parent to buy food items • People of Urban Area tend to buy more packed food • After Covid there is requirement for healthy food products • Problems with Cloned Livestock
- 18. PESTEL Analysis Technological • Emerging of digital online market • Competitive style of advertisement through online platform • New Age of packaging Legal • Food law and regulation differ from country to country • Labour law • Court proceedings and the delay in the enforcement of rules • Consumer protection law Environmental • Change in climatic condition • Regular scrutiny by environmental agencies like NGT • Plastic Packaging is not allowed in many countries
- 19. SWOT Analysis Strength 1. Extensive distribution network 2. Providing a wide range of biscuits 3. Innovative advertisement 4. Serving Indian Markets from last 120 years 5. High brand recall Weakness 1. Low penetration in rural areas 2. Dependence on stores & retailers 3. Lower market share in dairy segment 4. Heavy expenditure on advertising and marketing 5. Over dependency on the biscuit business Opportunity 1. Demand for diet 2. Retaining retailers and wholesalers 3. Emerging Dairy Industry 4. Overseas Market 5. Increase in purchasing power of people in India Threats 1. Local bakery products 2. New Entrants - eg. Cadbury Oreo, sunfeast dark fantasy 3. Rising cost raw Materials 4. Unable to utilise the resources 5. Lack of Technology
- 20. TOWS ANALYSIS Strength Weakness Opportunities • As demand for diet is increasing worldwide, Britannia can provide wide range of healthy products in the overseas market. • There is increase in purchasing power of people in India therefore Britannia can use their distribution network to increase its customer base all over India. • Due to its high brand value, expanding their business in dairy segment would be profitable strategy. • Lower market share in dairy industry can use the opportunity of emerging market in this segment • Over dependence on stores could be minimise by utilising the opportunity in ecommerce • Over dependency on the biscuit business can be diversified into other segments by utilizing the opportunity of increasing demand for diet Threats • High brand value could avoid the threat of local bakery products • Creating high brand recall could avoid the threat of new entrants. • Aggressively Entering in rural market can neglect any chance of new entrants • Conventional Advertising And Marketing expenses can be shifted to rural market to increase their customer reach • Technological advancements is necessary
- 21. 4 Ps Product • Core product • Actual product • Augmented product Price • Competition pricing • Product line Pricing • Bundle pricing • Value-based pricing Promotion • Sales promotion Advertisement Place Distribution Channel Distribution Centres Warehousing Transportation
- 23. Bargaining Power of Suppliers • Big FMCG companies are able to date the prices through local souring from a fragmented group of key commodity suppliers. • There are no of suppliers. Bargaining Power of Buyers • Low switching cost induces the customer product shift • Influences of market strategies • Availability of similar product of competitor’s brand Barriers to Entry • Scaling opportunity • Brand equity • Expected retaliatory action
- 24. Rivalry Among Competitors • Private local retailers are periods at discount to mainframe brands limits competitions for the weak brands • Most of biscuits frame making same product at same price and the main rivalry of Britannia is Parle, ITC Bisk frame etc. • High fragmented industry as more MNC’s are entering to market and giving perfect competition Threat of Substitutes • The huge investment in setting up distribution network and promoting brands • Spending lot of money to advertisement is aggressive • Narrow product differentiation • High availability of product of multiple brand • Having cut-throat price war
- 25. 5 force Analysis Bargaining power of Suppliers • Suppliers can exert pressure on businesses and even buyers by raising prices Bargaining power of Buyers • Availability of similar product of other brand or same product of same brand Threat of substitutes • High availability of product of multiple brand Rivalry among competitors • The main rivalry of Britannia is parle, ITC Bisk frame etc., these are the products which have both prices and product same • Amul and Nestle are competitors in dairy segment. Threat of entrants • Threat of new entrants is moderate because huge revenues are expected from by baking industry as per trend. • The new-comer has to face intense competitive environment.
- 26. Key Partners • Distributors • Retailers • Internal management • Testing management • Local farmers • Product manufacturers Key Activities • Brand Building • Production of Health products Key Resources • Biscuits • Snacks • Dairy Value Proposition • Guarantee of Quality • Access and Availability • Emotional Value • Price Customer Relation • Transactional • Media Marketing Channels • Retail Trade • TV Channels Customer Segments • Demographic • Psychographic • Behavioral • Geographic • Technographic Cost Structure • Materials • Labour • Other Expenses Revenue Streams • Sales of biscuits • Sales of Bread, Cake • Sales of dairy product
- 27. Star Question Mark Cash Cow Dog GROWTH SHARE MATRIX • Tiger • Little Hearts • 50-50 • Bourbon • Pure Magic • Good Day • Marie Gold • Treat • Nutri Choice Digestive
- 29. STRATEGIC RECOMMENDATIONS • Strategising in Dairy business as they are not best in the market therefore in our recommendation company should give good margin to retailers for selling their dairy products. • Increasing its ditribution network because its competitor Parle is going head to head in the competition • Can Introduce new flavours • Can associate with various government initiatives as mid day meals, Sarva Shiksha Abhiyaan, National Rural Health Missions for more Brand Awareness.
- 30. STRATEGIC RECOMMENDATIONS • Britannia can cut costs for some period of time with following immediately by strong social media advertising. • Can Start Schemes like cash prizes or foriegn trips on scratching the barcode on the packet. Can start schemes like free toys with britannia cake as it attracts kids a lot. • Mergers and acquisition in the dairy industry with local players will help the company in increasing its distribution network and market share. • Can improve packaging; make them attractive • Can open dedicated britannia stores