1.

1 INTRODUCTION
Marketing is an integrated communications-based process through which
individuals and communities discover that existing and newly-identified needs and wants
may be satisfied by the products and services of others. Marketing is defined by the
American Marketing Association as the activity, set of institutions, and processes for
creating, communicating, delivering, and exchanging offerings that have value for
customers, clients, partners, and society at large.

Marketing is influenced by many of the social sciences, particularly psychology,

sociology, and economics. Anthropology and neuroscience are also small but growing
influences. Market research underpins these activities. Through advertising, it is also
related to many of the creative arts. So it is clear that marketing concept in the present
scenario is consumer oriented. Marketing efforts are mainly for attracting the customers
and satisfying their expectations.

The project, study with Rani Food Products, Vadakara in order to understand the
functions and activities connected with marketing department. The study includes
identifying the purchase influencing factors. Then land of spices and other goodies, this
is how the rest of the world identifies Kerala, the small southern state in the Indian Sub-
continent. The trade ties in spices and other products, which this small state has had with
many European and Arab nations dates back to many centuries.

Mr. V.R Krishnan, a commerce lecturer by profession, gave up his job to start Rani
Private Limited 30 years back. The company has its headquarters in Vatakara, in the
Malabar region of Kerala. A team of dedicated and expert personnel works in a
sophisticated and technologically superior environment. Modern machineries are used to
increase quality of work and also for ensuring their employees a good and safety
working conditions. Thus assuring premium spice powder that remains pure and fresh.

A sincere effort is made to bring out the factors behind the consumer buying decision
of non-durable goods through the present study.

1.2 PROBLEM DEFINITION

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 “Customer is the king” in any market. The success and failure of any product depends
on how well it caters the needs and wants of the targeted customer. The food products are
not different from this concept. Winning the confidence of customers is necessary. It will
result in increased sales and increase in customers.

Attaining new customers and retaining the existing customers are the main focus of
ever company. For that it is important for them to understand the consumer behavior.
Consumer behavior is influenced by so many factors. The behavior of one person will not
be same in different situation. Like wise behavior of two customers will not be same. So
it is very significant for all the companies to understand the factors affect the behavior of
the consumers while they take a purchase decision. So the research problem of this study
entitled “factors influencing customers buying decision of non durable goods” is as
follows

“What are factors influencing decision of customers while they buy purchase
non durable goods?”

1.3 SIGNIFICANCE OF THE STUDY

Rani Private limited company is a well known spice powder manufacturing

company in Kerala. They also deal with the exporting of packed spice powder to Arab
countries and European countries. Today there are so many companies dealing with spice
powders. So the competition in the industry is immense, for survive in the market for any
company, it must study the factors influencing the consumer’s behavior while he select a
particular product. So it is clear that this study is vital for all the companies in the market
to achieve their objectives by satisfying the needs of consumers.

The study is more concerned with the consumer behavior. The decision making is
processes where by a buyer decide to purchase a particular product out of various
alternatives. Thus the study conducted is of real importance as it helps the management
to have a good knowledge of the buying behavior. The study also helps to understand the
reasons why one chooses the organization’s product and hwy some choose the product of

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that of the competitors. The study of consumer behavior provides critical information to
the marketing managers in developing the marketing strategies and tactics.

1.4 SCOPE OF THE STUDY

The consumer or buyer is the person or group of persons, who decide what to buy
, when to buy and what not to by. In competitive environment one cannot thrust a
product on consumer. He has to produce what is demanded or what can be demanded.
The marketing personnel study consumer behavior to find out what can be sold and what
good s and services are likely to be rejected. Through the study he is motivated to buy or
not to buy after study of consumer behavior through market research or otherwise
manufacturer tries to find out how sales can be pushed of existing products, what
changes are required in existing products, what changes are required to get larger market
share. The more important 66more important function and purpose is to influence the
behavior of consumers through advertisements, incentives and other methods so that
consumer behavior is studied buy marketing personnel to influence the behavior of
consumers after studying what factors decides the behavior for a particular product,
persons, groups or regions.

The scope of the study covers the areas of various products offered by Rani
Private Limited. The research study is limited to the area of district of Calicut and
Malappuram. The factors which influence consumer buying decisions like price of the
product, brand name or reputation of the company, attributes of the product,
advertisement, usage, accessibility, quality of the product, previous experience etc are
taken into consideration.

1.5 OBJECTIVES OF THE STUDY

1.5.1 PRIMARY OBJECTIVE

1. To study the factors influencing consumer buying decision of non durable goods.

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1.5.2 SECONDARY OBJECTIVES:
1. To identify whether the price of the product have any influence on the consumer
buying behavior.
2. To study the association with brand name of the company and the consumer
buying behavior.
3. T o find out influence of advertisement on the consumer buying behavior.
4. To study the influence of the family/friends opinions on the consumer behavior.
5. To study the effect of previous experience about the product on the consumers
purchase decision.

1.6 RESEARCH HYPOTHESIS

A hypothesis is a preliminary or tentative explanation or postulate by the researcher

of what the researcher considers the outcome of an investigation will be. It is an
informed/educated guess. It indicates the expectations of the researcher regarding certain
variables. It is the most specific way in which an answer to a problem can be stated.

Research hypotheses are the specific testable predictions made about the
independent and dependent variables in the study. Hypotheses are couched in terms of
the particular independent and dependent variables that are going to be used in the study.
The research hypothesis of this study is as follows.

Ho: There is no significant relationship between price of the product and consumer
buying behavior.

Ho: There is no significant relationship between brand name of the company and
consumer buying behavior.

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Ho: There is no significant relationship between company advertisements and consumer
buying behavior.

Ho: There is no significant relationship between family/friends opinion and consumer

buying behavior.

Ho: There is no significant relationship previous experience on the products and

consumer buying behavior.

1.7 RESEARCH METHODOLOGY

Research is a systematic method of finding solutions to problems. It is essentially

an investigation, a recording and an analysis of evidence for the purpose of gaining
knowledge. According to Clifford woody, “research comprises of defining and
redefining problem, formulating hypothesis or suggested solutions, collecting, organizing
and evaluating data, reaching conclusions, testing conclusions to determine whether they
fit the formulated hypothesis”1

1.7.1 Sampling Design.

A sample design is a finite plan for obtaining a sample from a given population.
Simple random sampling is used for this study.

1.7.2 Universe.
The universe chosen for the research study is the whole customer’s of Rani
Private Limited.

1.7.3 Sample Size.

Number of the sampling units selected from the population is called the size of
the sample. Sample of 100 respondents were obtained from the population.

1.7.4 Sampling Procedure.

1 Kothari C R. “Research Methodology-Methods & Techniques”-2nd revised edition (2007) New Age
International Publishers- New Delhi.

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 The procedure adopted in the present study is probability sampling, which is also
known as chance sampling. Under this sampling design, every item of the frame has an
equal chance of inclusion in the sample.

1.7.5 Methods of Data Collection.

The data’s were collected through Primary and secondary sources.

1.7.5.1 Primary Sources.

Primary data are in the form of “raw material” to which statistical methods are
applied for the purpose of analysis and interpretations.
The primary sources are discussion with administrative officers of Rani Private
Limited, data’s collected through questionnaire.

1.7.5.2 Secondary Sources.

Secondary data’s are in the form of finished products as they have already been
treated statistically in some form or other.
The secondary data mainly consists of data and information collected from
records, company websites and also discussion with the management of the organization.
Secondary data was also collected books.

1.7.6 Nature of Research.

Descriptive research, also known as statistical research, describes data and
characteristics about the population or phenomenon being studied. Descriptive research
answers the questions who, what, where, when and how.
Although the data description is factual, accurate and systematic, the research
cannot describe what caused a situation. Thus, descriptive research cannot be used to
create a causal relationship, where one variable affects another. In other words,
descriptive research can be said to have a low requirement for internal validity.

1.7.7 Questionnaire.
A well defined questionnaire that is used effectively can gather information on
both overall performance of the test system as well as information on specific
components of the system. A defeated questionnaire was carefully prepared and specially
numbered. The questions were arranged in proper order, in accordance with the
relevance.

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1.7.8 Nature of Questions Asked.
The questionnaire consists of open ended, dichotomous, rating and ranking
questions.

1.7.9 Pre-testing
A pre-testing of questionnaire was conducted with 20 questionnaires, which were
distributed and all of them were collected back as completed questionnaire. On the basis
of doubts raised by the respondents the questionnaire was redialed to its present form.

1.7.10 Sample
A finite subset of population, selected from it with the objective of investigating
its properties called a sample. A sample is a representative part of the population. A
sample of 100 respondents in total has been randomly selected. Actual samples are taken
from the Calicut and Malappuram district. The response to various elements under each
questions were totaled for the purpose of various statistical testing.

1.7.11. Variables of the Study.

Direct variables of the study are the buying behavior of the customers of Rani
Private Limited.
Indirect variables are price, brand name, advertisement, reference group, previous
experience and quality of the Rani Food Products.

1.7.12. Presentation of Data.

The data are presented through charts and tables.

1.7.13. Tools and Techniques for Analysis.

Correlation is used to test the hypothesis and draw inferences.

2. LITERATURE REVIEW
2.1 consumer behaviour
Consumer behaviour is the study of when, why, how, where and what people do
or do not buy products. It blends elements from psychology, sociology, social
psychology, anthropology and economics. It attempts to understand the buyer decision
making process, both individually and in groups. It studies characteristics of individual

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consumers such as demographics and behavioural variables in an attempt to understand
people's wants. It also tries to assess influences on the consumer from groups such as
family, friends, reference groups, and society in general.

Belch and Belch define consumer behaviour as 'the process and activities people
engage in when searching for, selecting, purchasing, using, evaluating, and disposing of
products and services so as to satisfy their needs and desires.

2.2 Factors influencing consumer behaviour

The behaviour of consumers is dependent on a number of factors which may be
economic or non-economic factors and dependent upon economic factors such as
income, price, psychology, sociology, anthropology, culture, and climate. Therefore the
study is dependent upon all these science and consumer behaviour scientists study it
through research and they believe that these behaviour can be influenced which has
proven by sales promotion of a large number of products. However there is dispute
whether customer should influenced or not and what methods should applied to influence
him.

When one decides to buy a particular product it is an economic decision and

expectations play an important role. One expects from a product or services best of
performance, durability, and dependability. The decision making is a process where by a
buyer decides to purchase a particular product out of various available alternative. The
process of selection and final selection is known as buying decision making.

Throughout the buying process, various factors may influence the buyer. All
these factors which determine the buyer or consumer behavior are broadly classified into
five – psychological factors, social factors, cultural factors, personal factors and
economical factors.

2.2.2 Psychological factors.

The psychological factors are factors that operate within individuals partly
determine the people’s general behavior thus influencing their behavior as
consumers. The following are the important psychological factors.

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2.2.2.1. Consumer needs and motivation
Motive lies in every buyer. It arises from the needs and wants. The process of
motivation stimulates it and leads him to buy. Thus motive is a stimulated need which an
individual wants to satisfy. A simple example is that when we feel hungry, we may
search for restaurant. Hunger is the motive and search is the action. Thus motivation is a
driving force within an individual which impels him to action to satisfy his needs.
Buying behavior is the result of three factors multiplied by each other – the ability to buy
something, the opportunity to buy it and the motivation (wish, need, desire) to do so.

2.2.2.2. Perception
Different people perceive the same thing at the same time in different ways.
Similarly the same individual at different times may perceive the same thing in a number
of ways. Perception is the process of selecting, organizing and interpreting information
inputs to produce meaning. Information inputs are sensation received through sight,
taste, hearing, smell and touch. When we here an advertisement ,see a friend, smell
polluted air or water or touch a product we receive information input. The
information is conveyed to the brain from the eyes, ears and other sense organs. The
brain’s task is then to take this raw material and use it to help us make sense that
environment through the process of perception
.
In short, perception is the process by which individual receives and interprets the
incoming stimuli through different senses. The different sights, sound, smell, taste
and sensations that we felt are known as stimuli . Perception shapes the behavior of an
individual. This play an important role in buying decisions.
2.2.2.3. Learning
Learning greatly influences consumer behavior. Learning is the process of
acquiring knowledge. It is the process of creating changes in behavior through
experience and practice. Learning occurs through the interplay of drives, cues, responses
and reinforcement. A drive is a strong internal stimuli which satisfy the drives (i.e.
Needs). Cues are minor stimuli which determine when, where and how the buyer
responds. Response is the individual’s reaction to the cues. Reinforcement takes place
when consumer is satisfied with the response
.

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 The important of learning theory for marketers is that they can create demand for
a product by associating it with strong drives, using motivating cues and providing
positive reinforcement.

2.2.2.4. Beliefs and attitudes.

A person forms certain beliefs and attitudes in his mind. It is on experience and
learning. A belief is a descriptive thought that a person holds about something. Such
thoughts are based on learning, opinion or faith. For example, a consumer may believe
that Maruti cars are less costly and fuel efficient. These beliefs are responsible for
developing product and brand images. Thus beliefs influence buying behavior.

Attitude represents a person’s feelings towards a particular object or situation. It

may be positive, negative feelings about products, service, and companies. Attitudes are
shaped and influenced by demographics, social factors and personality of individual
himself. Attitude lead people to behave in a particular way. Attitude plays an important
role in purchase decisions. Marketers should understand and influence consumer
attitudes towards their products.

2.2.3. Cultural factors

Culture encompasses the social values, attitude, towards work, social intercourse,
laws, customs, traditions, etc. Cultural factors are briefly discussed as follows.

2.2.3.1. Culture
Culture is the most fundamental factor influencing a person’s wand and behavior.
Culture is defined as all the environment that is created by people. It is a set of ideas,
customs, values, art and beliefs that are produced or shared by society and passed on
from generation to generation. Culture influences the buying behavior of the consumer.
It sets the life style and provides guidelines regarding what should and should not be
done. Thus smoking and drinking are common habits in the west. In eastern countries
these habits are not widespread. Dining on table and with the help of knives and fork is
widely prevented in the west while the people of eastern countries generally eat on the
floor and with the fingers (except Japanese and Chinese). This means that the market for

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drinks or forks is limited in eastern countries. Thus culture influences what we eat and
wear, how we relax and where we live.

2.2.3.2. Sub- culture

Culture within a culture is called sub-culture. A sub-culture is a psychological,
religious, social or geographical source of group identification. Thus a person living in
Kerala would feel that he is different from the one living in Tamil Nadu. Psychological,
sub-culture that are important to people and their sense of identity can have an influence
on their behavior.

2.2.3.3. Social class.

There is a relationship between social class and consumption pattern. Asocial
class is a group of people with similar values, interest and behavior within a society.
Consumers buying behavior is determined by the social class to which they belong rather
than by their income alone. The social class is based on income, education, occupation,
family history, social status etc
.
Sociologists divide most societies into three classes – upper, middle, and lower.
Shopping pattern, savings, and spending habit, leisure time activities etc. Differ in
different social classes. Upper class buys products of high quality irrespective of price.
Middle class buy items to show their status in the society. They live well. They spend
their leisure in park, museums etc. The lower middle class buy less expensive goods.

Lower class is composed of factory workers, coolies, petty service people who
are not well educated and have low income. They buy very simple and cheep products.
Thus we can see that the social class has a definite influence on products and brand
preferences.

2.2.4. Social factors

Forces that other people expert on buying behavior is called social factors. The
important social factors are as follows.

2.2.4.1. Reference group.

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 A person not only interacts with his family but also with the groups outside his
family. One such a group is reference group. Reference groups are the social, economic
or professional group. A reference group consists of family friend, relatives, friends, co-
workers, classmates, teenagers, sports group, music lovers, club membership etc. A
consumer buys those goods which his reference group buys. For example, our friend may
influence our choice of cloths, books, cinema and music. We consult our families in
choosing car’s, home, food, investment and furniture. It is necessary for the marketers to
identify the reference groups of their target markets.

2.2.4.2. Role and status.

A person plays s many roles in his or her life. His or her role changes with the
position her or she holds in a group- family, friends, organization, colleagues, neighbors
etc. People choose products that conform to their role and status in the society.

A person’s role and status exercise great influence on his or her buying behavior
also. For example, an advocate in his professional capacity may buy regularly up-to-date
law books. At home he may purchase durable goods kike refrigerator, furniture etc. He
may be the president of a rotary club. He may spend money on charities. Therefore, a
marketer should consider not merely the reference group of a customer but also the role
and status which he occupies in that groups.

2.2.4.3. Family.
Status, background, size etc. of the family influence the buyer behavior. In
nuclear families wife and dominates in purchase of goods, cosmetics, kitchenware,
washing machines and other household articles. Husband normally purchases
automobiles, electronic goods, insurance and the like. Some decisions are taken jointly
by husband and wife like furniture, interior decoration, housing etc. Children also
influence purchase of certain items like sports goods, clothes, recreational goods etc.
Thus the family is one of the important factors determine consumer behavior.

2.2.4.4. Family life cycle

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 The family life cycle is a useful factor influencing consumer behavior. The
family life cycle describes how a typical family evolves from bachelorhood to marriage,
from marriage to having children and maintaining them and then to solitary retirement.
At each stage in the cycle the needs, experience, income and family composition change.
The family life cycle is an excellent tool for market segmentation and for developing
market campaigns and advertisement.

The need of families in different stages of life cycle change considerably. For
example, young bachelors have more needs of cigarettes, showy clothing’s, camera etc.
Newly married couples spend more on clothing, recreations, shopping goods etc. As the
size of the family grows with addition of children, the expenditure increases on food,
clothing, toys, school bags, and umbrella and so on. As children get married and start
living separately, family grows old and there is considerable change in buying pattern.
For the older couples, the need shifts to simple clothing, drugs, spectacles, walking
sticks, traditional books and so on.

2.2.5. Personal factors.

Personal factors are those unique to a particular person. Important personal
factors influencing buyer decision making are as follows

2.2.5.1. Age and life cycle stage.

Needs are determined by age. Small children require milk powder, baby food;
toys etc. young adults require recreational facilities and transportation etc.

2.2.5.2. Personality.
One individual is different from others not only in physical features but also in
decision making .Every individual has a distinct personality that influence his behavior
and thus his behavior also. Personality of an individual refers to his personal trait which
determines his behavior. The personality traits such on confidence, dominance,
sociability, friendliness, aggressiveness, emotional stability, etc. are variables which
facilitate in analyzing consumer behavior

2.2.5.3. Self image.

People all have an image of which they are and reinforce this image through their
purchases. The tendency to believe that “you are what you buy” is especially prevent

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among young people. Marketers utilize on the peoples needs to express the identity
through their purchases by emphasizing the image value of products and services. That is
why professional athletes, cricket players, film artists and musicians are frequently used
in advertisements.

2.2.5.4. Occupation
The occupation of a person decides the consumption pattern. For example, a
teacher would buy simple clothes, books, papers, etc. A company executive would buy
expensive cloths, visit by air, etc.

2.2.5.5. Life style.

Life style refers to an individual’s pattern of living expressed through
activities, interests and opinions. Life style patterns include the ways people spend
time, the extent of their interaction with others and their general outlook on life and
living. Life style has strong impact on many aspects of consumer buying decision
process. Life style influence consumer’s product need, brand preference, types of media
used, and how and where they shop.

2.2.6. Economic Factors.

2.2.6.1. Personal income: - Gross income of a person is composed of disposable income
and discretionary income. The disposable income is the balance remaining after
deducting taxes and compulsory deductions from gross income.

When disposable income rises, the expenditure on various items will increase and
vice versa. The discretionary income is the income remaining after meeting basic
necessaries of life. This income is available for buying shopping goods durables and
luxuries. The increase in this income raises standard of living.

2.2.6.2. Family income

Family income is the aggregate income of all members of a family. The family
income also influencing the buying behavior of the family. The family income remaining
after the expenditure on the basic needs of the family is made available for buying
shopping goods, durables and luxuries.

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2.2.6.3. Savings.
When a person decides to save more out of his present income, he will spend less
on comforts and luxuries .However, his expenditure on profitable investment increases at
the same time.

2.2.6.4. Income expectations

If a person expects any increased in his income, he will buy durables such as
scooter, car, refrigerator etc on hire purchase or installment basis. If his future income is
likely to decline, he will restrict his expenditure to bare necessities.

2.2.6.5. Liquidity position.

The liquidity position of a person refers to his holding of cash and assets which
can be quickly convertible into cash, example, and bank balance marketable securities. If
an individual has more liquid assets, he goes in for buying comforts and luxuries

2.3 Alternative Evaluation

In almost every product there a number of alternatives for a consumer, be it a day

to day consumer product like grocery, butter, tea, coffee or consumer durables like TV’s,
refrigerators, air conditioners, motor bikes, cars, house and other services. Today there
are over 30 models and more are introduced now and then. Hence the consumer can
decide which one is the best alternative for him. Thus alternative evaluation can be
defined “as the process by which a choice alternative, is evaluated and selected to meet
consumer needs”

The selection of costly products are done with great care, one collects
information on various models available. Then he eliminates those which are beyond his
budget. In the next stage, he short lists two/three models and studies them in depth for
which he consult his friends, relatives and those who have technical knowledge about the

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product and finally he select one model (chart 1). The number of stages differs from
product to products and situation to situation. In case of daily use choice is simple and
often it is made on the basis of past experience and short memory. Some of these
products are also purchased on recommendations of retailers or friends or influence of
advertisements. Most of the decision for non-durables i.e. FMCG is taken on the spot
mostly in the shop, sometimes based on past experience, sometimes induced by retailer
and some times influenced by advertisements of the producers.

2.3.1 Criteria for evaluation for buying Non durable Goods

2.3.1.1 Price
In poor countries like India often alternative evaluation is done on price
consideration which one can afford. For instance, in case of detergent, house or a car first
consumer decides the range which is in his reach or affordability or his willingness to
spend upon a product. Then he examines those brands which are within his brand. Many
companies initially succeeded because of low price. Japan after Second World War
captured many markets in different countries because of low price. Now china is
applying the same tactics for capturing the markets all around the world.

2.3.1.2 Brand i.e. Reputation of the manufacturer.

In most of the markets for each product a number of brands are available for
almost any product including rice, wheat flour, tea, coffee, vegetables, pickles, mobile, to
mention a few. The consumers give due weightage to brand reputation aspects and feel
that a product which has higher market share than others is rated high in choice making
by a consumer, be it a FMCG, consumer durables, services or others. Therefore,
marketers are always on alert to increase the market share.

2.3.1.3 Attributes
Different products have different attributes like taste, flavor, fragrance, durability,
performance etc. In case of products like basmati rice, tea, toothpaste, cosmetics, etc
brand is very important factor. But in India many unbranded products are selling largely
on price consideration especially in rural markets. But their color, smell, quality, shape
are also considered. There are hundreds of attributes which are considered for different
products.

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2.3.1.4 Experience
The prior experience about a product or service is an important factor to use it
again or not to use it. If one has good experience on one product, he may not consider
other brand and most likely will purchase it again unless better products have been
introduced in the market and consumer feels them better than tried product or service.

2.3.1.5 Familiarity
The familiarity about a product depends to a considerable extent on the
advertisement, friends, relatives and family members. In evaluation consumer consider
only those brands which are known to him which is different than personal experience.

2.3.1.6. Trade-off
There are positive and negative aspects about a products or service. The
consumer will select that product which has more positive points than negative points.
He, in order words trade off negative aspects with positive aspects and product must
have net positive aspects to be considered for purchase.
2.3.1.7 Number of alternatives to be considered.
At present in India for most of the products and many services there are a number
of alternatives with the exception of railways and electricity and to a certain extent
communication services. It is not possible for an average consumer to consider all of
them before making a choice. Therefore, he decides to restrict his choice to a few
models/brands. Normally an average consumer restricts his choice to 3 or 4 maximum
five brands. The marketer’s job is to make consumer aware about his product so that it
may be short listed for consideration.

2.3.1.8 Advertisement
The consumer has to be made only aware but familiar about a product so that it
may be included for alternate consideration set of consumers. This important job is done
by advertisements. Consumers of certain products feel that advertised products are better
and they discard those products which are not advertised frequently. Some consumers
feel that heavily advertised products are better than less advertised products. But if this
criterion is given high weightage, many products will be left out because 50% production

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in India is in small scale sector and they rarely advertise their products or services. Thus
only limited weightage should be given to it.

2.3.1.9 Accessibility
Accessibility is an important criterion for certain products and services. For
example one will buy sweets from a nearby shop specially when there is some
unexpected guest even if quality is inferior. Similarly for provisions one looks to nearby
shops but some shops have started making supplies of order given on telephone at home
but this service could not overcome the problem of accessibility specially for those
consumers who buy only after seeing the product.

2.3.1.10. Memory
The memory of a consumer is a store of information, experience, quality, price
and many evaluations are memory based. Those factors which catch consumer’s eyes are
memory factors and decisions choice are made on the basis of impressions about various
alternative products.
But often memory of majority of consumers is short which is called working
memory, only very limited number of consumers have sharp and long memory. Hence
considerable weightage is given to proper display in stores so that it may catch the eye of
a consumer.

2.3.1.11 Objective of purchase

Some products and services can be bought by different consumers with different
objectives. Some products are purchased for utility and some others for show or status. If
one is throwing a party on the occasion of daughter’s marriage one will serve the best
possible foods and drinks. But on some other occasion the same consumer will choose
what he can easily afford. Thus objective often becomes main deciding factor of a
particular alternative.

2.3.1.12 Quality
The quality is an important factor in deciding to buy a particular brand or not. In
case of industrial machinery and raw materials by industry and in case of consumer
durables quality is an important selecting criteria: same is true for hospitals and many

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other services in order that consumer gets the right quality and are not cheated various
countries have laid down standards for quality. In India, BIS has fixed standards.

2.3.1.13 Beliefs
Beliefs are subjective evaluation which have been formed overtimes based on
culture, experience, religion, region etc. if consumer believes that ‘A’ shop is good for
grocery, ‘B’ restaurant is good for lunch or dinner, ‘C’ picture hall is good for watching
movies, he will use this belief for purchase or utilizing the services. If some one believes
that foreign brands are better than domestic brands he will buy them only. This criterion
plays an important role in India. Similarly in daily consumer purchase decision this
aspect plays a very important role in final evaluation and selection and all other factors
become secondary and fall in the background. Hence the marketed constantly makes
consumers believe that his product is the best.

2.3.1.14 Performance
Consumer wants to evaluate how a product performs, be it a consumer durable or
service. If in his judgment out of ten alternatives, product X has a reputation for
performance, he will like to buy that product even if the price is higher. The evaluation is
based on information with the consumer and his relatives and friends experience. This
information is also collected from survey reports and other sources.

2.3.1.15 Consistency
The consumer prefers to purchase only this brands which remain constantly good
quality and do not reduce the quality with the passage of time. Therefore certain
producers have maintained same quality for generations. If a manufacturer of soap,
sweets or some other products reduces the quality soon sales curve drops. The consumers
expect same good quality will supplied consistently. But inspire of this fact many Indian
producers do not maintain consistency and they suffer.

2.3.1.16 Features
The consumers are also attracted by special features of a product whether it is
ready to eat food, insurance policy or durables. As special features do influence the

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purchase it is necessary to introduce them but consumer judges to what extent these
claims are true.

2.3.1.17 Trail
In case of daily use products like soaps, detergents, shampoos, tea, pickles,
panmasala and many other consumable consumers may buy a product for trail. N order
to help consumers in this regards companies have introduced small trail packs. If
consumer likes a product on trail, he becomes the permanent customer. It is often
thought that trail is possible only in the case of FMCG but now one can have trail drive
for automobiles and after trail if he is satisfied he can decide to buy, otherwise he can
reject the product. In order to encourage consumers to buy their products some
companies also provided free sample trails and some hold free trail stalls in certain
events. For example- Nescafe Coffee.

The above is only illustrative list of criterias which a consumer may decide to
consider evaluating a product or services. It is not necessary to consider all of them for
each product. Further, consumer may choose other criterias which he feels appropriate
based on his knowledge, information, and family influence for a particular product or
services.

2.4.1 Consumer Buying Process.

Buying is a mental process. A decision to buy a product is taken after passing
through different stages. The buying decision process involves the following steps:

2.4.1.1 Problem Recognition

The consumer decision-making process begins when a buyer recognizes a
problem or an unsatisfied need or desire. For example, a consumer might think it is time
to buy a new car when his current one has to be repaired four times in one month. Or a
student might have the desire for a compact disk (C D) player because some of her owns
them. Since consumer may not always recognize that they have a problem or a need,
business use products, advertising, packaging, and sales personnel to help trigger
consumer awareness of need and desire.

2.4.1.2 Information Search

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 After recognizing a problem or need, the consumer seeks out information on
how to satisfy it. An information search can focus or product features, prices,
availability of brands, seller characteristics, warranties, and other factors. Business can
expedite the information search by supplying consumers with useful, accurate, timely,
and readily available product information.

Consumer usually begin the search process with an internal search process
with an internal search into their memory .Usually , a person had stored information in
his or mind for dealing with that need. In this case, a decision can be made with a little or
no additional information search. However, if more information is needed, consumers
engage in external search. In this case, additional information is obtained from a variety
of external sources. One source of information is communication with other people,
including family, friend, and associates. Although it is difficult to gauge which of these
sources are actually used, they are considered a powerful influence on buying decisions.

Marketing sources of information include advertising, salespeople, dealers and

product packages. Buyers can also obtain information from public sources such as
independent product rating and newspaper articles, these sources, such as consumer
reports, are important because they are though to be objective and provide information
on quality and value. Finally, examining the product or actually using the product may
provide additional information.

How consumer process this information depends on a number of factors,

including amount of information, availability, method of presentation, quality and
confidence. One danger firm’s face is the situation in which a consumer reaches an
information overload. A person may collect so much information that is become difficult
to evaluate the alternatives. Although firms cannot eliminate this possibility, they should
provide only information based on the criteria that are most important to target
customers. The way which the information is transmitted also influences how it is
processed. For many products, pictures are recalled with greater accuracy then are words,
and the combination of picture and words is most effective. The quality and availability
of information also influence how consumer process information.

After the information is processed, it should yield a group of brands from which
the buyer can choose. This group of brands sometimes called the buyer’s evoked set. For

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example, the student’s search for a CD player might yield an evoked set of Sony, Jensen,
Sanyo, Pioneer, Demon and Magnavox machines. The consumer must then evaluate each
of the alternatives in the evoked set.

2.4.1.3 Evaluation of alternatives

Buyers have choices. They are looking for certain benefits from their purchase.
So they evaluate the alternatives on the basis of attributes – taste, color, price, durability,
quality etc. Of the alternative products. He assesses the merits and demerits of all the
available alternative. It helps the consumer in choosing the best possible alternative

2.4.1.4 Purchase decision

While evaluating each alternative, the consumer ranks them first, second and
third etc. These are his preferences. Now the customer goes to the shop and buys the
product of the brand chosen.

2.4.1.5 Post purchase behavior: - After the consumer has actually purchased the
products / brand he will be satisfied or dissatisfied with it. This satisfaction or
dissatisfaction will result in certain consequences. If he is satisfied with the product, he
would regular buy the brand and develop a loyalty. If he is dissatisfied with the product
he may stop buying more products of that brand and may also spread bad words about
the brand. This negative feeling which arises after purchase causing inner tension is
known as cognitive dissonance. A marketer therefore, understands the correct buying
process of customers and decides on marketing activities accordingly rather than by their
income alone. The social class is based on income, education, occupation, family history,
social status etc.

Sociologists divide most societies into three classes – upper, middle, and lower.
Shopping pattern, savings, and spending habit, leisure time activities etc. Differ in
different social classes. Upper class buys products of high quality irrespective of price.
Middle class buy items to show their status in the society. They live well. They spend
their leisure in park, museums etc. The lower middle class buy less expensive goods.
Lower class is composed of factory workers, coolies, petty service people who are not

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well educated and have low income. They buy very simple and cheep products. Thus we
can see that the social class has a definite influence on products and brand preferences.

The purchase decision also depends upon the psychology of the buyer. For this
purpose there are four following views of consumer decision making.

2.5.1 Four views of consumer decision making

• # Economic person
• # Passive person
• # Cognitive person
• # Emotional person.
2.5.1.1 Economic person:-
In economics a person is considered a rational human being and makes decisions
on the basic of price. But this behavior is not considered realistic by scientists.
According to them skills, habits are limited. The people have limitations of their values
and goals. The behavior is also limited on the basis of limitation of information and
knowledge. In this world economic and marketing conditions are imperfect as well as
persons are imperfect. Thus decision is not taken purely on economic factors such as
relationship between price and marginal utility, or indifference curves. Thus decision
making is combination of economic and other factors and is not purely economic
decision.

2.5.1.2 Passive person:-

In passive model it is presumed that persons are submissive to self interest and
promotional efforts of marketers influence passive person more than non-passive
persons. These persons are those who believe that decision depends upon their
persuasion and in this theory high importance is given to salesman. But modern
marketers place limited role of marketer which seems more realistic because human
being is a rational person and he uses his knowledge, skill and weights alternatives on
the basis of their attributes. No longer has he blindly believed what is said in
advertisement.

2.5.1.3 Cognitive person:-

The believers in cognitive theory presume that man is a problem solver. They
actively and rationally study the attributes. The task of such persons has been made

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easier by professional journals, consumer forums, consultants, and market reports, In the
process of decision making consumer gathers and evaluates information before arrive at
a decision . The information is sought on the attributes of competitive products, their
performance, durability, price, service and if one feels it necessary he seeks information
from relatives and friends especially from those friends who are technocrats. But the
limitation of this theory is that a person is not able to collect information on all
alternatives and sometimes he is not able to get full information ever of short listed
brands. Therefore, the decision sometimes is not totally logical.

In other circumstances buyer is overloaded with information and one finds it

difficult to process whole of it. This theory, however, is applicable to educated consumer
who is fully involved. Since these conditions prevail in small fraction of Indian
consumer, often he is bluffed and marketer influences his decision more than in well
educated country.

2.5.1.4 Emotional person

The decision of people is not fully rational on many occasions because we all are
emotional. For instance, we go to the market and like the product on first sight; we it
without further injury. This is particularly true in case of objects of art, gift items,
fashion goods and religious books, and services. In the matter of sex also one become
emotional and does not consider price or consequences.

If we go to religious places and see god idols, pictures or other objectives we buy
them without further thought whether our pocket allows it or not. When purchases are
based on emotions less or no emphasis is placed on pre-purchase information. The
decision basically depends on mood and feelings. If two friends are roaming in a market
and through window shopping like a product they enter the shop/ store and buy it
immediately. If one visits a store and likes some displayed items he immediately picks
them for purchases, sometimes even without asking for price.

Moods are also part of emotion. If we are in happy mood on some good news we
have happy feelings and buy some such thing which we might not have bought
otherwise. The moods depend not only on events affecting an individual but also on
atmosphere prevailing around. Therefore, big good and fragrance. Hotels and restaurants

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also create conditions for good mood to attract customers. In good mood sometimes
buyer’s decision is bases largely on marketing feelings without considering information
on the product. This type of decision takes place in the matter of music records,
cosmetics, fashion goods, visit to a restaurant etc.

Thus it may be concluded that buying decision is a complex matter and in

different situations different factors have bigger or smaller role. It is not always possible
to generalize decision making theory.

2.6 Low Involvement Decision Making.

When the stake in item to be purchases or service to be utilized is not much and
the risk of wrong decision is only short lived, decision making involves low of
involvement. If for instance consumer decides to buy X brand washing powder and does
not find it suitable it can be rejected and repeat purchase is not made of the same brand.
But the loss due to buying decision is limited to the cost of the powder. If one develops
fever and visit near by doctor and he takes longer time than normally required he can be
discarded. If some one sends a courier mail from Delhi to Mumbai and it does not reach
next day the service can definitely be rejected for next mail but if the mail contains
important documents delay may cause loss and so risk is involved. Thus the law of
involvement does not depend entirely on the nature of product or service but also on
other factors such as its consequences. Therefore even in some low involvement product
or service decision making has to depend upon other factors too. However, on the whole
generally no or very limited inquiry is done for low involvement items. Very often some
inquiry is made from seller but its attributes vis-à-vis of alternatives is not evaluated.

2.7 Unplanned Purchase Behavior

All purchase by any consumer is not preplanned. When a wife visits a market for
planned purchases and if something which was not in the list she likes or finds it a
bargain on-spot the short decision is taken for purchase which is called unplanned
purchase. The unplanned purchases may be defined those purchase decisions which are
taken on the spot without any prior planning. Such purchase is quite large when visits an
exhibition or visits a religious place or visit mela like Khumbh Mela . One sees many
products at these place and makes purchases for oneself , relatives and friends, for gifting
or when innovative products are available . Generally when one visit such places he

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takes money for such purchases but does not know what he is going to buy. The purchase
decision in such circumstances is called unplanned purchase decision. The basic point to
observe is that no prior inquiry is made nor prior information is collected.

But in such purchases also often alternatives are available and one has to decide
which product is better. This depends purely on mood at that point of time and liking or
disliking of particular product or alternative. It will not be correct to say that all
unplanned purchase decision is taken without considering alternatives.

2.8 Strategic Implication of Low Involvement Decision Making.

In case of low involvement decision making it is more likely that consumer
change the brand if he finds equally good brand in the market or there is bargain sale or
discount sale. In products of low involvement there is class of consumers for whom
“brand loyalty” has little meaning. More ever studies in India suggest that brand loyalty
is weakening. The bargain sales are attracting customers like buy two trousers and get-
one free, buy a toothpaste and get tooth brush free, buy Nature Fresh Atta and get a
scratch coupon free. There are a number of others who offer 10 to 20 percentage extra
quality without extra price.
The consumer purchase decisions are influenced by such bargains because he
belongs to none especially in case of low involvement products. The thumb rule in India
discount bazaars is that who give best deal to buyers thrives . It has been realized by
marketers that price value score cover brand. This trend is most visible not only in
garments but also in FMCG. Therefore Lux offers Rs. 5 discount . Good Knight
mosquito mats offered free soap , the management of shoppers stop admit that discount
sales work well for store because it sells more and attractive customers Bombay Dyeing
has discount sales every year . Since Bhilwara group announced 15 to 50 percentage
discount its sales have doubled . If there is no basic difference in a product consumer
decision is based on discount or incentives available . But brand loyalty is continuing in
certain items like cosmetics and design and quality conscious customers . However , the
share of such buyers in total is decline and strategic planners will have to keep this fact
in mind. Now buyers for low involvement products decide on the basis of price and
value over brand at least in India where purchasing power of majority of consumers is
limited.

2.9 Complex Decision Making.

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 In case of high involvement products and services decision making is complex
and difficult. If for example some one is seriously ill besides the reliability of a doctor
one has to look to his pocket and permanent loss of funds if treatment does not succeed .
The heart operation cost Rs. 3 Lakh in one hospital and Rs. 1 Lakh in another hospital.

The concern person has to decide whether it is worth spending Rs. 3 Lakhs
instead of Rs. 1 Lakh, in such case psychology, emotion, price, and pocket play a part
along with reliability. There are social cultural inputs consisting of non-commercial
influences which are considered. Social class, culture, sub-culture, information, opinion
of users all plays a part.

If some one decides to buy a car, it is available from Rs. 2 Lakhs onwards going
up to Rs.25 Lakhs or more for imported car. The decision to buy a particular models
does not depend merely on technical factors, reliability of operations, trouble free
operation but also on non-utility factors. The buyer considers his status, ego satisfaction,
impression on friends and relatives and satisfaction that most of his known persons do
not process that high price model. But there is other whose decision is based only on
utility. In that case he has to collect information on all the possible models , compare
there technical and non-technical features , narrow down his choice to two or three
models before taking the final decision .At this stage friends who have experience of
driving that model or who knows about automobiles is consulted.

In any other high involvement item also the process is quite complex first one has
to collect information on alternative choices , evaluate them not only in term of
performance , reliability and durability but also price. One is required to work out cost
benefit analysis and terms of payment. It is difficult to evaluate all these complex
factors. When some manufacturer is offering wide range of TV or Refrigerator task
becomes all the more complex.

2.10 Problem Factors In Decision Making.

All said the choice decision is not easy and increasing the number of alternative
always does not lead to best choice. Many researchers have found that when numbers of
alternatives increases, the consumers use such strategies which eliminate a number of

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alternatives at an early stage but when the numbers of alternatives are less one goes into
greater detail.

When there are too many alternatives and a larger number of attributes to be
considered often marketers and policy makers do not provide complete information
because it has found by researchers that when more information is given consumer tend
to make poorer decisions. However, many researchers differ from this view like Russo,
Wilkie, Sumers that choice accuracy increased as more information and attributes are
added. But what is a good decision is disputed.

The other factors which may make decision biased is that many consumers have
pre-determined notions and preference and make decisions by brands, many of them do
not add more alternatives and new attributes to the alternatives under consideration and
the predetermined alternative is selected for final purchase.

Sometimes consumer is confronted with non-comparable attributes of different

alternative choices. For example certain marketers offer discounts and other incentives
which are independent of the attributes of alternatives . In such a situation often
consumers are attracted by discounts, and sales incentives.

The choice decision also depends upon ability of consumers to process the given
information. Some consumers have better abilities to compare available information and
some offer do not have that much ability and make wrong choice. In order to help
consumers to assess information better, some marketers make same information more
salient by using color, size etc. They use same pattern of information on all labels so that
it may be easy to locate and understand. Moreover, information is given in such manner
that it may be easy for consumers to understand and compare.

The good marketer uses symbols that quickly and largely convey their concept
and give information on advantages and risks at one place. Good stores also give
information on their board. The information is given in such a manner that encourages
proper understanding and forming correct strategies. The researches have concluded that
most of the consumers have limited capacity to process the information.

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 Throughout the buying process, various factors may influence the buyer. All
these factors which determine the buyer or consumer behavior are the psychological
factors, social factors, cultural factors, personal factors and economical factors. Thus a
lot of factors are there in this present scenario that influences the consumer behavior.

2.11 Models of Consumer behavior

2.11.1 Monadic models of consumer behavior

2.11.1.1 Elasticity model

This is a pure economic, more precisely, micro economic model. The model says:
as the price increases, other things remain constant; demand of the commodity will go
down. But how much it will go down, will depend on the nature of the commodity, if the
price goes up slightly, demand will fall much larger margin. Diamond is, therefore
known as highly price elastic, while commodity like petrol may not be very cheap, but
life comes to a standstill without it. If price of the petrol increases, people cannot reduce
the consumption, and in general, decrease in quantity is much less than the increase in
price. All such commodities are called price inelastic.

2.11.1.2 Response hierarchy model

The model attempts to predict the sequence of mental stages that the consumer
passes through while purchasing a product. This model is purely psychological. It covers
three mental stages, namely, cognitive, affective, and behavioral. Cognitive stages deals
with creation of knowledge or awareness in the mind of the consumers. The next stage is
concerned with the developing an interest in the mind of the consumer which results in
develop in an attitude or change in attitude towards the specific product. The attitude
formation finally brings us to the behavior formation, the buying behavior.

One of the most popular response hierarchy models is the AIDA model. AIDA
stands for attention, interest, desire, and action, depicts the sequence of mental stages
that the consumer passes through before buying

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.

Stage AIDA Model

Attention
Cognition

Interest
Affective

Desire

Behavior

Action

(Figure No.2.11.1.2.1)
2.11.1.3 The black Box Model
Black Box model is also called stimulus response model. Consumer’s mind and
thought processing is treated like a “black box” which cannot be opened to find out its
working. The model highlights the input stimulus like promotional advertisement and
resultant output, the purchase behavior.

Input stimulus Purchase Behavior

Product The impregnable Product Choice

Price Blank Brand Choice
Promotion Box Brand loyalty
Place

The Black Box Model (Figure No.2.11.1.3.1)

Black box model although does not describe formation of purchase behavior
but mentions personality, motivation, attitude and learning process the factors standing in
between input stimulus and output behavior. Later on market researchers developed the
model into complex multivariable model.

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2.11.2 Electric or Multivariable models of consumer behavior

2.11.2.1 The Howard-sheth model

The model explains the buyer decision process using six sets of variables as seen
in the figure.
INHIBITORS
BEHAVIORAL
DETERMINANTS Price of product, Brand

Personality Availability of product,

brand
Culture
Financial status of
Social class individual

Importance of purchase Time constrains on individual

decision

INPUTS PERPECTUAL PROCESSING OUTPUTS

REACTION DETERMINANTS
Product services Perpetual bias Attending
Brands Purchase Understanding
Sensitivity of motivation attitudes
Facts information Available Purchase
intention
Images Filtering of Satisfaction
information Purchase
Feelings Past experience behavior

Judgment criteria Purchase decision

ACTUAL
PURCHASE OR
NO PURCHASE
OR DELAY

The Howard Sheth Model (Figure No.2.11.2.1.1)

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 2.11.2.1.1Input variable: - these include information inputs about the
alternative services or products available with rational and emotional elements. For ex- a
customer wants to possess a standard chartered Gold card, he will seek information
regarding the facilities of such card, the interest charged and will also affected by the
promotional Ad of Standard Chartered gold card.

2.11.2.1.2 Behavioral Determinants: - these variables are the pre existing

elements in consumer’s mind and existing pre disposition of the consumer, influenced by
his culture, family and other such factors. Behavioral determinants do not play overt role,
nevertheless, play a significant role in buying decision. While buying a Standard
Chartered gold card the potentional buyer’s consideration of possessing a credit card as
status symbol or his habit of buying expensive items, will bear a positive impact on his
decision of owning the card.

2.11.2.1.3 Perpetual reaction: - Information from inputs is not accepted at

their face value by the consumer but are processed in the minds of the consumers and
then interpreted. For example: a person who is serious about possessing a gold card will
compare the advantages and disadvantages with the similar credit card. He will seek
information activity. He will go out of the way to get the information, try to assilimilate
as much as possible and filter all the important information. One not so interested person
may also receive some information on the TV set and will not be sensitive to the
information and hence won’t filter much of it for processing purpose

2.11.2.1.4 Processing determinants: - these are the factors affecting

evaluation of the gathered information. Factors affecting are motivation and past relevant
experience. Learning process will include experience about the product and also on post
purchase service. The consumer will also apply some judgment at the criteria to evaluate
the alternative.

2.11.2.1.5 Inhibiters: - these are the external constrains, inhibiting the actual
or potential purchase behavior. For possessing the cold card, the inhibiters can
a) Rate of interest charged
b) Income of the person
c) Relative price of other credit cards

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 d) Any formality that has to be fulfilled, for example: one has to submit his income
statement, his permanent income tax account number etc.

2.11.2.1.6 Output variables: - the outcome of the process of the interacting

elements may results in the purchase decisions, not to purchase or post-dated purchase

2.11.2.2 The Howard Ostlund model

Howard and Ostlund model is an improvement on the Howard- Sheth model,
in terms of greater predictability of the consumer’s buying decision. However, the model
is much more complex than the Howard Sheth model.

Although the model is more comprehensive, it is extremely difficult to

understand, because its variables are further divided into too many “content” variables
i.e. which deal with what the buyer thinks- brands comprehension, personal attitudes etc
and “structural” variables i.e. how the buyer thinks- media selection process, perceptual
bias etc.

2.11.3 The product adoption Model

Given the fact that much of marketing communication activities are related to
the launching of new products, developing a consumer behavior model especially for
finding how consumers “adopt” the product is highly beneficial for the marketers.
Rogers defined the “diffusion” as the process by which ‘innovation’ is communicated
over time among the individuals within society who constitute the target market. The
diffusion process depends on four factors. They are
a) The diffusion itself
b) The communication process and channels used
c) The time at which the individuals deicide to adopt the product and
d) The various class of consumers

There are five categories of consumers involved in this whole process of

diffusion of innovation
2.11.3.1 Innovation: - They are venture individuals who are willing to try
new ideas and consume new products, even, if there could be certain defects in the new
product

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 2.11.3.2 Early adopters: - They are opinion leaders within the particular
industry or social group. These people are willing to try new ideas ahead of others, but
who make careful assessment of potential risk before trying or using the new product

2.11.3.3 Early majority: - These people try the innovated products, services,
or ideas ahead of rest of the gentry or masses. They hold up their purchase till they get
favorable information from the early adopters.

2.11.3.4 Late majority: - They are risk averters and unadventurous. They take
new product when it is well listed in the market.

Early Late
majority majority
34% 34%

Early
adopter Laggards
Innvaotors 2.5% 13.5% 16%

Product Innovation model (Figure No.2.11.3.1)

2.11.3.4 Laggards: - They buy the product when the new product no more
remains new. The speed at which a new product gains acceptance and is adopted by all
types of consumers, varies from product to product. The speed is much higher in case of
easily understood consumer precuts: kitchenware, consumer non durables: like soft
drinks etc. while in case of technically complex products the speed is much lower.

The model is successful in helping the marketers to understand the process of

diffusion. This significant especially for FMCG companies, which frequently bring out
new products for market along with heavy promotional spending, assuming that the all

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the consumers will accept the products. The time dimension in learning and adopting is
of crucial importance. Similarly for technical goods, like a laptop or palmtop computers,
it is very important for the marketer or the producer to understand the period when they
can accept the acceptance of the product by the majority. This is very important to know
as these products are always under the threat of technological obsolescence.

3.1 INDUSTRIAL PROFILE

The Food Manufacturing Industry is the complex, global collective of diverse
businesses that together supply much of the food energy consumed by the world

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population. Only subsistence farmers, those who survive on what they grow, can be
considered outside of the scope of the modern food industry.

3.1.1 Definitions
"Food industry" is not a formally defined term; however, it is usually used in a
broadly inclusive way to cover all aspects of food production and sale. The Food
Standards Agency, a government body in the UK, describes it thus."...the whole food
industry – from farming and food production, packaging and distribution, to retail and
catering." The Economic Research Service of the USDA uses the term "food system" to
describe the same thing.”The U.S. food system is a complex network of farmers and the
industries that link to them. Those links include makers of farm equipment and
chemicals as well as firms that provide services to agribusinesses, such as providers of
transportation and financial services. The system also includes the food marketing
industries that link farms to consumers and which include food and fiber processors,
wholesalers, retailers, and foodservice establishments."

3.1.1.1 Nature of the Industry

Workers in the food manufacturing industry link farmers and other agricultural
producers with consumers. They do this by processing raw fruits, vegetables, grains,
meats, and dairy products into finished goods ready for the grocer or wholesaler to sell to
households, restaurants, or institutional food services.

Food manufacturing workers perform tasks as varied as the many foods we eat.
For example, they slaughter, dress, and cut meat or poultry; process milk, cheese, and
other dairy products; can and preserve fruits, vegetables, and frozen specialties;
manufacture flour, cereal, pet foods, and other grain mill products; make bread, cookies,
cakes, and other bakery products; manufacture sugar and candy and other confectionery
products;

Process shortening, margarine, and other fats and oils; and prepare packaged
seafood, coffee, potato and corn chips, and peanut butter. Although this list is long, it is
not exhaustive: Food manufacturing workers also play a part in delivering numerous
other food products to our tables.

Quality control and quality assurance are vital to this industry. The U.S.
Department of Agriculture (USDA) oversees all aspects of food manufacturing. In
addition, other food safety programs have been adopted recently as issues of chemical
contamination and the growing number of new food-borne pathogens remains a public

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health concern. For example, by applying science-based controls from raw materials to
finished products, a program called Hazard Analysis and Critical Control Point
(HACCP) focuses on identifying hazards and preventing them from contaminating food.

Thirty-four percent of all food manufacturing workers are employed in plants that
slaughter and process animals and another 19 percent work in establishments that make
bakery well. Seafood product preparation and packaging, the smallest sector of the food
manufacturing industry, accounts for only 3 percent of all jobs.

3.1.1.2 Agriculture

Agriculture is the process of producing food, feed, fibre and other desired
products by the cultivation of certain plants and the raising of domesticated animals
(livestock). The practice of agriculture is also known as "farming", while scientists,
inventors and others devoted to improving farming methods and implements are also
said to be engaged in agriculture. More people in the world are involved in agriculture as
their primary economic activity than in any other, yet it only accounts for four percent of
the world's GDP.

3.1.1.3 Food processing

Food processing is the set of methods and techniques used to transform raw
ingredients into food or to transform food into other forms for consumption by humans
or animals either in the home or by the food processing industry.

Food processing typically takes clean, harvested crops or slaughtered and

butchered animal products and uses these to produce attractive, marketable and often
long-life food products. Similar processes are used to produce animal feed. Food
processing takes clean, harvested or slaughtered and butchered components and uses
them to produce marketable food products.

3.1.1.4 History

Food processing dates back to the prehistoric ages when crude processing
incorporated slaughtering, fermenting, sun drying, preserving with salt, and various types
of cooking (such as roasting, smoking, steaming, and oven baking). Salt-preservation
was especially common for foods that constituted warrior and sailors' diets, up until the
introduction of canning methods. Evidence for the existence of these methods exists in
the writings of the ancient Greek , Chaldean, Egyptian and Roman civilisations as well
as archaeological evidence from Europe, North and South America and Asia. These tried
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and tested processing techniques remained essentially the same until the advent of the
industrial revolution. Examples of ready-meals also exist from pre industrial revolution
times such as the Cornish pasty and the Haggis

Modern food processing technology in the 19th and 20th century was largely
developed to serve military needs. In 1809 Nicolas Appert invented a vacuum bottling
technique that would supply food for French troops, and this contributed to the
development of tinning and then canning by Peter Durand in 1810.

Although initially expensive and somewhat hazardous due to the lead used in
cans, canned goods would later become a staple around the world. Pasteurization,
discovered by Louis Pasteur in 1862, was a significant advance in ensuring the micro-
biological safety of food.

In the 20th century, World War II, the space race and the rising consumer society
in developed countries (including the United States) contributed to the growth of food
processing with such advances as spray drying, juice concentrates, freeze drying and the
introduction of artificial sweeteners, colouring agents, and preservatives such as sodium
benzoate. In the late 20th century products such as dried instant soups, reconstituted
fruits and juices, and self cooking meals such as MRE food ration were developed.

In Western Europe and North America, the second half of the 20th century
witnessed a rise in the pursuit of convenience; food processors especially marketed their
products to middle-class working wives and mothers. Frozen foods (often credited to
Clarence Birdseye) found their success in sales of juice concentrates and "TV dinners". [1]
Processors utilised the perceived value of time to appeal to the post-war population, and
this same appeal contributes to the success of convenience foods today.

3.1.1.5 Food industry technologies

Sophisticated technologies define modern food production. They include many

areas. Agricultural machinery, originally led by the tractor, has practically eliminated
human labour in many areas of production. Biotechnology is driving much change, in
areas as diverse as agrichemicals, plant breeding and food processing. Many other areas
of technology are also involved, to the point where it is hard to find an area that does not
have a direct impact on the food industry. Computer technology is also a central force,
with computer networks and specialized software providing the support infrastructure to
allow global movement of the myriad components involved.

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3.1.1.6 Marketing

As consumers grow increasingly removed from food production, the role of

product creation, advertising, publicity become the primary vehicles for information
about food.

With processed food as the dominant category, marketers have almost infinite
possibilities in product creation.

3.1.1.7 Wholesale and distribution

A vast global transportation network is required by the food industry in order to

connect its numerous parts. These include suppliers, manufacturers, warehousing,
retailers and the end consumers. There are also those companies that, during the food
processing process, add vitamins, minerals, and other necessary requirements usually lost
during preparation.

3.1.1.8 Retail

With populations around the world concentrating in urban areas, food buying is
increasingly removed from all aspects food production. This is a relatively recent
development, taking place mainly over the last 50 years. The supermarket is a defining
retail element of the food industry, where tens of thousands of products are gathered in
one location, in continuous, year-round supply.

Food preparation is another area where change in recent decades has been
dramatic. Today, two food industry sectors are in apparent competition for the retail food
dollar. The grocery industry sells fresh and largely raw products for consumers to use as
ingredients in home cooking. The food service industry offers prepared food, either as
finished products, or as partially prepared components for final "assembly".

3.1.1.9 Regulation

3.1.1.9.1 Labour and education

Until the last 100 years, agriculture was labour intensive. Farming was a common
occupation. Food production flowed from millions of farms. Farmers, largely trained
from generation to generation, carried on the family business. That situation has changed
dramatically. In North America, over 50% of the population were farm families only a
few decades ago; now, that figure is around 1-2%, and some 80% of the population lives
in cities. The food industry as a complex whole requires an incredibly wide range of
skills. Several hundred occupation types exist within the food industry.

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3.1.1.10 Research and development

Research in agricultural and food processing technologies happens in great part in

university research environments. Projects are often funded by companies from the food
industry. There is therefore a direct relationship between the academic and commercial
sectors, as far as scientific research.

3.1.2 Prominent Food Companies

• The Food World is the biggest directory for food, beverage and agriculture
industries, worldwide.

• DuPont and Monsanto are the leading producers of pesticide, seeds, and other
farming products.

• Both Archer Daniels Midland and Cargill process grain into animal feed and a
diverse group of products. ADM also provides agricultural storage and
transportation services, while Cargill operates a finance wing.

• Bunge is a global soybean exporter and is also involved in food processing, grain
trading, and fertilizer.

• Dole Food Company is the world's largest fruit company. Chiquita Brands
International, another US based fruit company, is the leading distributor of
bananas in the United States. Sunkist Growers, Incorporated is a U.S. based
grower’s cooperative.

• Tyson Foods is the world’s largest processor and marketer of chicken and the
largest beef exporter from the United States. Smithfield Foods is the world's
largest pork processor and hog producer.

• Nestlé is the world's largest food and beverage company. Kraft Foods is the
largest U.S. based food and Beverage Company. Unilever is an Anglo-Dutch
company that owns many of the world's consumer product brands in foods and
beverages.

3.1.3 Working Conditions

Many production jobs in food manufacturing involve repetitive, physically
demanding work. Food manufacturing workers are highly susceptible to repetitive-strain
injuries to their hands, wrists, and elbows.

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 This type of injury is especially common in meat-processing and poultry-
processing plants. Production workers often stand for long periods and may be required
to lift heavy objects or use cutting, slicing, grinding, and other dangerous tools and
machines. To deal with difficult working conditions, ergonomic programs have been
introduced to cut down on work-related accidents and injuries.

In 2003, there were 8.6 cases of work-related injury or illness per 100 full-time
food manufacturing workers, much higher than the rate of 5.0 cases for the private sector
as a whole. Injury rates vary significantly among specific food manufacturing industries,
ranging from a low of 1.8 per 100 workers in retail bakeries to 12.9 per 100 in animal
slaughtering plants, the highest rate in food manufacturing.

In an effort to reduce occupational hazards, many plants have redesigned

equipment, increased the use of job rotation, allowed longer or more frequent breaks, and
developed training programs in safe work practices. Furthermore, meat and poultry
plants must comply with a wide array of Occupational Safety and Health Administration
(OSHA) regulations ensuring a safer work environment. Although injury rates remain
high, training and other changes have reduced those rates. Some workers wear protective
hats, gloves, aprons, and shoes. In many industries, uniforms and protective clothing are
changed daily for reasons of sanitation.

Because of the considerable mechanization in the industry, most food

manufacturing plants are noisy, with limited opportunities for interaction among
workers. In some highly automated plants, manual work has been replaced by computers
and factory automation, resulting in less waste and higher productivity. While much of
the basic production—such as trimming, chopping, and sorting—will remain labor
intensive for many years to come, automation is increasingly being applied to various
functions, including inventory management, product movement, and quality control
issues such as packing and inspection.

Working conditions also depend on the type of food being processed. For
example, some bakery employees work at night or on weekends and spend much of their
shifts near ovens that can be uncomfortably hot. In contrast, workers in dairies and meat-
processing plants typically work daylight hours and may experience cold and damp
conditions. Some plants, such as those producing processed fruits and vegetables,
operate on a seasonal basis, so workers are not guaranteed steady, year-round
employment and occasionally travel from region to region seeking work. These plants

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are increasingly rare, however, as the industry continues to diversify and manufacturing
plants produce alternative foods during otherwise inactive periods.

3.1.4 Employment
In 2004, the food manufacturing industry provided 1.5 million jobs. Almost all
employees were wage and salary workers, but a few food manufacturing workers were
self-employed and unpaid family workers. In 2004, about 29,000 establishments
manufactured food, with 89 percent employing fewer than 100 workers (chart 1).
Nevertheless, establishments employing 500 or more workers accounted for 36 percent
of all jobs.

The employment distribution in this industry varies widely. Animal slaughtering

and processing employs the largest proportion of workers. Economic changes in
livestock farming and slaughtering plants have changed the industry. Increasingly, fewer,
but larger, farms are producing the vast majority of livestock in the United States.
Similarly, there are now fewer, but much larger, meat-processing plants, owned by fewer
companies—a development that has tended to concentrated employment in a few
locations.

Food manufacturing workers are found in all States, although some sectors of the
industry are concentrated in certain parts of the country. For example, in 2004,
California, Illinois, Iowa, Pennsylvania, and Texas employed 24 percent of all workers in
animal slaughtering and processing. That same year, Wisconsin employed 33 percent of
all cheese manufacturing workers, and California accounted for 20 percent of fruit and
vegetable preserving and specialty food manufacturing workers.

3.1.5 Occupations in the Industry

The food manufacturing industry employs many different types of workers. More
than half are production workers, including skilled precision workers and less skilled
machine operators and laborers (table 2). Production jobs require manual dexterity, good
hand-eye coordination, and, in some sectors of the industry, strength. Red-meat
production is the most labor-intensive food-processing operation. Animals are not
uniform in size, and slaughterers and meatpackers must slaughter, skin, eviscerate, and
cut each carcass into large pieces.

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 They usually do this work by hand, using large, suspended power saws. They
also clean and salt hides and make sausage. Meat, poultry, and fish cutters and
trimmers use hand tools to break down the large primary cuts into smaller sizes for
shipment to wholesalers and retailers. These workers use knives and other hand tools to
eviscerate, split, and bone chickens and turkeys.

Bakers mix and bake ingredients according to recipes to produce breads, cakes,
pastries, and other goods. Bakers produce goods in large quantities, using mixing
machines, ovens, and other equipment.

Many food manufacturing workers use their hands or small hand tools to do their
jobs. Cannery workers perform a variety of routine tasks—such as sorting, grading,
washing, trimming, peeling, or slicing—in the canning, freezing, or packing of food
products. Hand food decorators apply artistic touches to prepared foods. Candy
molders and marzipan shapers form sweets into fancy shapes by hand.

With increasing levels of automation in the food manufacturing industry, a

growing number of workers are operating machines. For example, food batch
makers operate equipment that mixes, blends, or cooks ingredients used in
manufacturing various foods, such as cheese, candy, honey, and tomato sauce. Dairy
processing equipment operators process milk, cream, cheese, and other dairy
products. Cutting and slicing machine operators slice bacon, bread, cheese, and other
foods. Mixing and blending machine operators produce dough batter, fruit juices, or
spices. Crushing and grinding machine operators turn raw grains into cereals, flour, and
other milled-grain products, and they produce oils from nuts or seeds. Extruding and
forming machine operators produce molded food and candy, and casing finishers and
stuffers make sausage links and similar products. Bottle packers and bottle fillers operate
machines that fill bottles and jars with preserves, pickles, and other foodstuffs.

Food cooking machine operators and tenders steam, deep-fry, boil, or pressure-
cook meats, grains, sugar, cheese, or vegetables. Food and tobacco roasting, baking, and
drying machine operators and tenders operate equipment that roasts grains, nuts, or
coffee beans and tend ovens, kilns, dryers, and other equipment that removes moisture

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 From macaroni, coffee beans, cocoa, and grain. Baking equipment operators tend
ovens that bake bread, pastries, and other products. Some foods—ice cream, frozen
specialties, and meat, for example—are placed in freezers or refrigerators by cooling and
freezing equipment operators. Other workers tend machines and equipment that clean
and wash food or food-processing equipment. Some machine operators also clean and
maintain machines and perform duties such as checking the weight of foods.

Many other workers are needed to keep food manufacturing plants and equipment
in good working order. Industrial machinery mechanics repair and maintain production
machines and equipment. Maintenance repairers perform routine maintenance on
machinery, such as changing and lubricating parts. Specialized mechanics
include heating, air-conditioning, and refrigeration mechanics, farm equipment
mechanics, and diesel engine specialists.

Still other workers directly oversee the quality of the work and of final
products. Supervisors direct the activities of production workers. Graders and sorters of
agricultural products, production inspectors, and quality control technicians evaluate
foodstuffs before, during, or after processing.

Food may spoil if not packaged properly or delivered promptly, so packaging and
transportation employees play a vital role in the industry. Among these are freight, stock,
and material movers, who manually move materials; hand packers and packagers, who
pack bottles and other items as they come off the production line; and machine feeders
and off bearers, who feed materials into machines and remove goods from the end of the
production line. Industrial truck and tractor operators drive gasoline or electric-powered
vehicles equipped with forklifts, elevated platforms, or trailer hitches to move goods
around a storage facility. Truck drivers transport and deliver livestock, materials, or
merchandise and may load and unload trucks. Driver/sales workers drive company
vehicles over established routes to deliver and sell goods, such as bakery items,
beverages, and vending-machine products.

The food manufacturing industry also employs a variety of managerial and

professional workers. Managers include top executives, who make policy
decisions; industrial production managers, who organize, direct, and control the
operation of the manufacturing plant; and advertising, marketing, promotions, public
relations, and sales managers, who direct advertising, sales promotion, and community
relations programs.

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 Engineers, scientists, and technicians are becoming increasingly important as the
food manufacturing industry implements new automation and food safety processes.
These workers include industrial engineers, who plan equipment layout and workflow in
manufacturing plants, emphasizing efficiency and safety. Also, mechanical
engineers plan, design, and oversee the installation of tools, equipment, and
machines. Chemists perform tests to develop new products and maintain the quality of
existing products. Computer programmers and systems analysts develop computer
systems and programs to support management and scientific research. Food scientists
and technologists work in research laboratories or on production lines to develop new
products, test current ones, and control food quality, including minimizing food-borne
pathogens.

Finally, many sales workers, including sales representatives, wholesale and

manufacturing, are needed to sell the manufactured goods to wholesale and retail
establishments. Bookkeeping, accounting, and auditing clerks and procurement
clerks keep track of the food products going into and out of the plant. Janitors and
cleaners keep buildings clean and orderly.

3.1.6 Outlook
Overall wage and salary employment in food manufacturing is expected to
increase by 4 percent over the 2004-14 periods, compared with 14 percent employment
growth projected for the entire economy. Despite the rising demand for manufactured
food products by a growing population, automation and increasing productivity are
limiting employment growth. Nevertheless, numerous job openings will arise in many
segments of food manufacturing, as experienced workers transfer to other industries or
retire or leave the labor force for other reasons.

Job growth will vary by occupation but will be concentrated among food
manufacturing workers—the largest group of workers in the industry. Because many of
the cutting, chopping, and eviscerating tasks performed by these workers have proven
difficult to automate, employment among handworkers will rise along with the growing
demand for food products, especially beef. Hand working occupations include
slaughterers and meat packers and meat, poultry, and fish cutters and trimmers, whose
employment will rise as the consumption of meat, poultry, and fish climbs and more
processing takes place at the manufacturing level. Other production workers also will
benefit from the shift in food processing from retail establishments to manufacturing
plants.

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 Although automation has had little effect on most handworkers, it is having a
broader impact on numerous other occupations in the industry. Fierce competition has
led food manufacturing plants to invest in technologically advanced machinery to be
more productive. The new machines have been applied to tasks as varied as packaging,
inspection, and inventory control. As a result, employment will not increase as rapidly
among some machine operators, such as packaging machine operators, as for industrial
machinery mechanics who repair and maintain the new machinery. Computers also are
being widely implemented throughout the industry, reducing employment growth of
some mid-level managers and resulting in decreased employment for administrative
support workers, but increasing the demand for workers with excellent technical skills.
Taken as a whole, automation will continue to have a significant impact on workers in
the industry as competition becomes even more intense in coming years.

Food manufacturing firms will be able to use this new automation to better meet
the changing demands of a growing and increasingly diverse population. As convenience
becomes more important, consumers increasingly demand highly processed foods such
as pre-marinated pork loins, peeled and cut carrots, microwaveable soups, or ready-to-
heat dinners. Such a shift in consumption will contribute to the demand for food
manufacturing workers and will lead to the development of thousands of new processed
foods. Domestic producers also will attempt to market these goods abroad as the volume
of international trade continues to grow.

The increasing size and diversity of the American population has driven demand
for a greater variety of foods, including more ethnic foods. The combination of
expanding export markets and shifting and increasing domestic consumption will help
employment among food manufacturing workers to rise over the next decade and will
lead to significant changes throughout the food manufacturing industry.

Unlike many other industries, food manufacturing is not highly sensitive to

economic conditions. Even during periods of recession, the demand for food is likely to
remain relatively stable.

3.1.7 Spices
Vast fortunes made and squandered, powerful rulers seduced, ailments cured, and
nations discovered…all in the name of spice. Spices have always cast a spell on our

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imaginations. They flatter our senses: our sight with their vibrant colors, our smell with
their enticing fragrances, and our taste with their distinct flavors.

Spices have been the catalysts of some of the greatest adventures in human
history, like Christopher Columbus' voyage. Still today, spices empower us as explorers,
even if we never journey beyond the kitchen counter. They energize our daily adventures
in food and remind us of journeys to exotic places and favorite meals with loved ones.

3.1.7.1 Black Pepper

Black and White Pepper are both obtained from the small dried berry of the vine
Piper nigrum. For Black Pepper, the berries are picked while still green, allowed to
ferment and are then sun-dried until they shrivel and turn a brownish-black color. They
have a hot, piney taste. Black Pepper adds flavor to almost every food of every nation in
the world. It is used in rubs, spice blends, salad dressings, and peppercorn blends.

3.1.7.1.1Origins

The principal exporters for Black Pepper are India (Malabar and Tellicherry
Pepper), Indonesia (Lampong Pepper), Brazil and Malaysia. Tellicherry is actually a
special type of Malabar Pepper designated for its bold size and uniform appearance. Both
have excellent flavor, aroma and pungency properties. The flavor and aroma of Lampong
Pepper is similar to the Malabar type. The Malaysian and Brazilian varieties are
relatively milder in flavor. Because pepper can be stored for many years without losing
its flavor and aroma, it has long been known as the master spice. Pepper was so precious
in ancient times that it was used as money to pay taxes, tributes, dowries, and rent. It was
weighed like gold and used as a common medium of exchange. In A.D. 410, when Rome
was captured, 3,000 pounds of pepper were demanded as ransom.

3.1.7.2 Cardamom
Cardamom is the dried, unripened fruit of the perennial Elettaria cardamomum.
Enclosed in the fruit pods are tiny, brown, aromatic seeds which are slightly pungent to
taste. Cardamom pods are generally green but are also available in bleached white pod
form. It is available both in the whole pod and as decorticated seeds with the outer hull
removed.

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 Cardamom is used in Danish pastries, Saudi Arabian, North African, Asian, and
Indian cooking and in spice blends such as garam masala, curry powder, and berbere.

3.1.7.2.1Origins
Whole Cardamom pods come from India while the decorticated seeds are
imported from Guatemala. Two varieties are indigenous to India but are also cultivated
in Guatemala and Sri Lanka. Indian Cardamom is considered to be of premium quality.
The Malabar type, rounded in shape, has a pleasantly mellow flavor generally regarded
as superior. The Mysore type, ribbed and three cornered, has a slightly harsher flavor but
retains its green color longer. Throughout the Arab world, Cardamom is one of the most
popular spices, with Cardamom coffee being a symbol of hospitality and prestige. The
spice is also very popular in the Scandinavian countries where it is used more
extensively than cinnamon.

3.1.7.3Cilantro

Cilantro is the dried leaves of the herb, Coriandrum sativum, an annual herb of
the parsley family. Also known as Chinese parsley, Cilantro has a distinctive green,
waxy flavor. Cilantro is the usual name for the leaf of the plant that is otherwise
identified as Coriander, and from which Coriander Seed is obtained. Used in salsas,
chutneys, salads, dips, beans, and soups. Cilantro is used in Asian, Mexican, Indian, Tex
Mex, Caribbean, and North African cuisines, and is used in seasoning blends such as
masala, curry, salsa, and recados.

3.1.7.3.1Origins

Cilantro is believed to have been one of the earliest plantings in North America,
where the cilantro leaves, rather than the seed, became more popular. Today, it is
cultivated in the Mediterranean region of Southern Europe, Mexico and the U.S.
Cilantro is mentioned in the Medical Papyrus of Thebes written in 1552 B.C. and is one
of the plants which grew in the Hanging Gardens of Babylon. Ancient Hebrews added
Cilantro to an herb mixture used in the ritual of Passover. Greek and Roman physicians
hailed its medicinal powers. The Coriandum sativum herb is believed to have been one
of the earliest plantings in North America - dating back to 1670 in Massachusetts - and it
soon appeared in Latin America where the Cilantro leaves, rather than the seed, became
most popular.

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3.1.7.4Cinnamon

Cinnamon is the dried inner bark of various evergreen trees belonging to the
genus Cinnamomum. At harvest, the bark is stripped off and put in the sun, where it curls
into the familiar form called "quills."

Cinnamon in the ground form is used in baked dishes, with fruits, and in
confections. Cassia is predominant in the spice blends of the East and Southeast Asia.
Cinnamon is used in moles, garam masala, and berbere.

3.1.7.4.1Origins

Cinnamomum burmannii is primarily imported from Indonesia and is the most

common form of Cinnamon in the United States. Once again, Vietnam has become the
source for Cinnamomun loureirii, referred to as Saigon Cinnamon, and considered the
finest Cinnamon available. Cinnamomum zeylanicum, grown in Sri Lanka, is actually
"true Cinnamon" but is not widely used in the United States due to its unique flavor.
Cinnamon was one of the first known spices. The Romans believed Cinnamon's
fragrance sacred and burned it at funerals. Because Cinnamon was one of the first spices
sought in the 15th Century European explorations, some say it indirectly led to the
discovery of America.

3.1.7.5Cloves

Cloves are the dried, unopened, nail-shaped flower buds of the evergreen
Syzygium aromaticum. They are reddish-brown in color and have a strong, aromatic
flavor and aroma. Cloves are an important ingredient in the spice blends of Sri Lanka
and North India. They are used in garam masala, biryanis, and pickles. In the U.S.,
cloves are used in meats, salad dressings, and desserts. Clove is a key flavor contributor
to ketchup and Worchestershire sauce seasoning blends. Chinese and German seasonings
also depend on Cloves to flavor meats and cookies.

3.1.7.5.1Origins

Cloves are believed to be native to the Molucca Islands of Indonesia. Although

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Indonesia is the largest producer of Cloves, Zanzibar and Madagascar are the major
exporters, where Clove trees cover thousands of acres of the islands. Historically, Cloves
originating from Madagascar have been considered superior.

The name Cloves comes from the French "clou", meaning nail. The first
references to Cloves are found in Oriental literature in the Han period in China under the
name "chicken-tongue spice". From the 8th Century on, Cloves became one of the major
spices in European commerce.

3.2 COMPANY PROFILE

Kerala is also known as the 'Land of Spices', as major portion of its cuisine is hot
and spicy. Coconut is an integral part of almost all dishes prepared in Kerala. Rice is the
staple food for the people of Kerala. Sea food is also an important part of Kerala cuisine.
Chutneys and pickles makes the Kerala food more tangy, lip-smacking and adds to its
taste value. People of Kerala are highly concerned about the health aspect of their food.
Thus, oil, sugar and artificial additives are used in minimum quantity.

Food is served on soft banana leaves and is eaten with hands. There is also a
prescribed order of serving various dishes on the banana leaf. The people of Kerala enjoy
both - simple dish known as 'Kanji' as well as an extravagant menu known as 'Sadya'.
People usually sit in rows of mats at the time of the sadya (feast) as a tradition.

The food is flavoured with non-scalding spices such as cinnamon, cardamom,

ginger, clove, garlic, cumin, coriander and turmeric. Spices are used to tone up the
system the way wines aid the digestion in the Western cuisine. Kerala food is mildly
flavoured, gently cooked and has a certain genteel delicacy on the stomach.

Appam - It is a kind of pancake made of rice flour fermented with a small amount
of toddy (fermented sap of the coconut palm). Appam is circular in shape, edged with a
crisp, lacy frill. It is eaten with chicken or vegetable stew. Kanji (rice gruel) and payaru
(green gram), kappa (casava) and fish curry are traditional favourites of the Keralites.

A popular breakfast dish is puttu - rice flour dough layered with grated coconut
and steamed in a hollow Bamboo cylinder. It is eaten sprinkled with sugar or with
mashed bananas or with a spicy curry made of channa or chic peas. Other South Indian
dishes such as 'Dosa', 'Iddly', etc are also common in Kerala. Deserts like Payasam and

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Palppayasam are made with milk, sugar, ghee, rice and dry fruits. The people of Kerala
put to good use whatever the land offers and the result is a fantastic cuisine that is simple
yet mouth-watering.

Then land of spices and other goodies, this is how the rest of the world identifies
Kerala, the small southern state in the Indian Sub-continent. The trade ties in spices and
other products, which this small state has had with many European and Arab nations
dates back to many centuries.

3.2.1 Vision of the company

Company believe in time and we are committed to give the best products to
customers every time. To fulfill that we are planning to expand in a big way.

Stand for Quality: To rise up to market's expectation out to give people the best
products evolve after a chain of quality evaluation methods.

Stands for relationships: To make a long standing relationship with people and
business partners.

Mr. V.R Krishnan, a commerce lecturer by profession, gave up his job to start
Rani Private Limited 30 years back. The company has its headquarters in Vatakara, in
the Malabar region of Kerala. A team of dedicated and expert personnel works in a
sophisticated and technologically superior environment. Modern machineries are used to
increase quality of work and also for ensuring their employees a good and safety
working conditions. Thus assuring premium spice powder that remains pure and fresh.

Their success in the local sector gave the company the impetus to export their
products to the Middle East and European nations by 1989. In India Company’s products
are available all over Kerala and the major cities in India. The brand “Rani” is accepted
as a mark of quality among the consumers. The company endeavors to give the very best
to their customers. Rani Spices are quality tested and graded before packing. Rani food
products were awarded the Indian Spices Logo in 1995.

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 The certificate is issued by Spices Board ensures excellent grading backed by
stringent standards. They are also presented the Spice House Certificate. All this, as
recognition for their sincere dedication to the profession of providing the customer’s
quality spices that are truly cut above the rest of their competitors in the market. Kerala
was always known for her inexhaustible array of exquisite spices and herbs. To live their
legendary frame, Rani Food Products was established in 1980 at chorode, Malabar. A
team of experts, dedicated personnel work here in a sophisticated environment using
most ground and blended in the right constituency to time masala; latest machines that
minimize heat generation are used to prevent evaporation of volatile oils. Assuring their
consumers premium spice powders, that remains pure and fresh.

Rani Spices are quality tested and graded before packaging. Attractive, air tight
packing brings the customers the spices with their natural flavor instinct.

In the factory four types of machines are used.

Machine Function

Powdering machine This machine is used to convert the raw

materials into powder

Cleaning Machine materials Removing of dirty and sand from the raw
materials

Packing Machine This is used for the packaging of the

finished products

Sealing Machines The packets are sealed using this machine

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3.2.2 Research and Development
Rani Private Limited has installed a fully-automated Microbiology-testing Lab to
ensure stringent quality in spices and ready-to-eat food products.
Tempo Reader detects yeasts and moulds within 48 hours. Eastern is the first company
in India in the spice sector to have this fully-automated ic system.

Vitec 2 Compact is used to detect bacteria.

Mini Vidas is an automatic instrument which enables Pathogen-screening.

Tecra Unique Plus - The Tecra Unique Plus Salmonella Test takes less than 22 hours as
compared to traditional methods of Salmonella-screening which takes 5-6 days.

HPLC is used for Toxin detection, pungency of chillies and Sudan Dye detection.

Gas Chromatograph - This equipment analyses pesticide residue count.

UV Spectrophotometer - This determines color value of chillies, curcumin in turmeric,

piperin in pepper.

NIR Spectrophotometer- For Nutrition factor analysis.

ELISA Plate Reader - Is used for aflatoxin, ochratoxin analysis.

Luminar Pocket Swab Plus - Based on the presence of cell component ATO,
Luminator Pocket Swab can estimate microbial count within minutes.

Air Ideal- Is used for environmental monitoring.

3.3 DEPARTMENT PROFILE

The head office and factory of Rani Food Products is situated in the chorode,
Vadakara. They have 118 employees including office staffs. There are 7 managers, 88
factory workers, 13 sales personnel, 10 office staff and one watchman. The
organizational structure of Rani Food Products got well defined hierarchical positions
which ensure them to work most effectively and efficiently.

53 | P a g e
The organizational structure of the Rani is characterized by the following
• Specialization by functions

• Emphasis on sub goals

• Pyramidal growth of the organization.

• Line and staff decisions

• Functional authority relationship among departments.

• Quick decision making

• High degree of specialization

• Brings order and clarity in the organization

• Promotes professional achievement

• Economy in the nature of organizational resources

• High degree of control and co-ordination of functions.

In the organizational, Managing Director controls all the function like production,
personnel, marketing and finance, which are the major functional areas of management.
These areas have their own organization procedures and sub activities.

3.3.1 Management
Sole authority of Rani Food Products lies in the hand of partners; they are the
Board of Directors. They in turn delegate some of their powers to managers. Managers
get their work done through persons lying below them.

3.3.1.1 Production department of Rani Private limited

Board of directors
54 | P a g e
 Production manager

Supervisor

Staff

The production manager and his team are responsible for realizing the visions of
the company within constraints of technical possibility. This involves coordinating the
operations of various production activities and maintains a good flow of work without
any blockage.

3.3.1.2 Human resource department of Rani Private limited

Board of directors

HR Manager

Assistant HR Manager

55 | P a g e
 Supervisor

Staff

The managing human resource in the organization is an important task. Human

resource department deals with the management of employees of the organization. Rani
Private Limited follows a system in HR department in which staffs are directly managed
by supervisor and this superior is accountable to his superiors. He has a communicator
between employees and top management.

He observes whether work is performed according to the plan and if there is any
deviation between the planned performance and actual performance, he takes necessary
measures to reduce that deviation.

HR department administers the salary of the employees. In Rani, each employee

is due to retire at the age of 58. Rani Pvt Limited provides provide retirement benefits
includes E.S.I, PF etc.

3.3.1.3 Marketing department of Rani Private limited

Board of directors

Marketing Manager

Supervisor

56 | P a g e
 Sales Representatives

Salesmen

The marketing manager is in- charge of the marketing activities of the company.
He organizes the market research to understand the needs and wants of the consumers
and analyses the information so obtained for determined sales strategies, setting targets
and developing new product s. He also evaluates the advertising and sales promotion
activities. Advertising is an important medium of canvassing.

Rani Pvt. Ltd, their advertising is done through fixation of banners, stickers,
board displays, poster, newspapers, magazines, periodicals etc. As the company is also
dealing with international markets, they provide awareness to customers through
participating in international exhibition; tours etc, and help to boast up the sales.

The management from time to time makes the decision regarding the amount spent
for advertisement. Company is marketing their products through two ways. They are
1. Direct distribution
2. Through agents and representatives

The company is using their own vehicles for the distribution of the finished products.

3.3.1.3.1 DISTRIBUTION CHANNEL

From the factory goods are sent to the warehouse. From the warehouse under the
guidance of the marketing department, it is supplied to distributors and through them it
reaches to the ultimate consumers.

Factory
57 | P a g e
 Wholesalers

Retailers

Consumers

3.4 PRODUCT PROFILE

Kerala, popularly known as "God's Own Country" is a paradise for spices and
other delicacies. Rani Food Products, have created a niche for itself in the processed food
segment by genuine spices and quality products

Main food products of the company

1. Spices powder

The species powders conform to the highest international standards in aroma and
quality retaining the dedicated texture flavors. Rani Brand consumers packaging is
mainly in 100gm, 200gm and 400gm, cartons and pouches. Bulk packaging includes 20
kg, 25kg bags. The varieties that we have in the segment are
• Chilli Powder
• Coriander Powder

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 • Turmeric Powder
• Dry Ginger Powder
• Cumin Powder
• Black Pepper Powder

Curry Powder
Rani Food Products have come up with some excellent curry powders. The
superior quality packing helps in retaining the flavor for a long time.

Chicken Masala
A mixture of many spices this is the ideal solution for the modern women. An
excellent powder, which will help you make many mouth-watering chicken recipes.
Meat Masala
An excellent masala powder for all your meat preparations.
Tandoori Chicken Masala
Now you can make tandoori chicken at home with Rani Tandoori Chicken
Masala.

Chicken Fry Masala

Another time saver for the workingwomen, this masala can save you precious
time.
Channa Masala
We have a range of North Indian curry powders also. This is one such masala for
you.
Biriyani Masala
For the avid biriyani lovers, here is an excellent powder to make mouth watering
biriyanis.
Fish Masala
This is also a time saver, the masala has all the ingredients for your favorite fish
curry. Just follow the instructions in the packet to make excellent fish curry.

1. Vegetable Masala
Excellent masala for all the vegetable preparations.

59 | P a g e
Sambar Powder
Premium spices are used to produce this excellent sambar powder.
Rasam Powder
A wonderful combination of different spices to make your favorite rasam.
Garam Masala
Spices are handpicked to make the best Garam Masala

PACKAGING
100g, 200g & 400g cartons &
Rani Brand Consumer Packing:
pouches
Bulk packing: 10 Kg & 25 Kg Bags

2. Vegetable Pickles:-

Hand picked vegetables and spices are used to make traditional and mouth
watering pickles.
Lime
Hand picked lime is used to make the traditional lime pickle.
Mango
Best quality mangos are picked to produce mango pickle the traditional way.

Tender Mango
Tender Mangos the best in the lot are chosen to make this mouth watering pickle.
Garlic
Only the best pods are used to make this pickle.
Ginger
Farm fresh ginger is used to make this delicacy.
Mixed Vegetables
The best lot of seasonal and off-season vegetables is used to make pickles that
could last for a long time.
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Ginger Chutney
An exquisite delicacy from Rani, this is surely going to make your mouth water
PACKAGING
100g, 200g, 500 g &
1Kg (Stand up pouch)
Rani Brand Consumer Packing: 300g, 400g & 1 Kg
(Glass bottles & Pet
Bottles)
1 Kg & 5 Kg (Plastic
Bulk Packaging:
containers & cartons)

3. Non Vegetable pickles

Prawns
Only the best prawns are selected for this delicacy.
Mussels
A shell fish found in the coastal area of Malabar, this pickle is a rare delicacy
for pickle lovers.
Fish
Another mouth watering delicacy, the taste of this pickle is sure to make you
want for more.

4. Whole spices
• Chilli
• Coriander
• Turmeric
• Mustard
• Fenugreek
• Cumin
• Dry ginger
• Black pepper
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 • Cloves

PACKAGING
50g, 100g, 200g, & 400g
Rani Brand Consumer Packing:
cartons & pouches
Bulk packing: 10 Kg, 25 Kg bags

1. Other products

Coffee Powder
The best coffee beans are picked, blended and roasted to give the coffee powder
with the right flavor and fragrance.
Idly powder
An easy to use preparation for the modern working women
Condiments Powder
Atta
Rice Powder (Puttu Podi & Appam Podi)
Useful for a variety of preparations, the Rani Brand rice powders have really
taken over the market.

62 | P a g e
 4. ANALYSIS AND INTERPRETATION OF DATA

4.1 DESCRIPTIVE STATISTICS

The data after collection has to be processed and analyzed in accordance with the
outline laid down for their purpose of the time of developing the research plan. This is
essential for a scientific study and for ensuring that the researcher had all relevant data
for making contemplated comparison and analysis.

The term Analysis refers to the computation certain measures along with
searching patterns of relationship that among data groups. Analysis of data in a general
way involves a number of closely related operations which are performed with the
purpose of summarizing these in such a manner that they answer the research questions.

Interpretation is the technique of growing inferences. In fact, the main function if

the researcher is the interpretation of the collected data. Interpretation is needed for each
question to give the result of the each question.

63 | P a g e
4.1 Age group of the respondents

NUMBER OF
AGE GROUP
SL NO RESPONDENTS PERCENTAGE

1 Below 20 8 8
2 20-30 28 28
3 30-40 52 52
4 Above 40 12 12
Total 100 100

(Table.4.1)

(Chart 4.1)
INTERPRETATION
The table shows that 52% of the respondents are in the age group of 30-40 year

4.2(a) Customer awareness about Rani Food Products

NUMBER OF
PARTICULARS

64 | P a g e
 SL NO RESPONDENTS PERCENTAGE

1 Yes 100 100

2 No 0 0
Total 100 100

(Table.4.2)

(Chart 4.2)

INTERPRETATION
The table shows that 100% of the respondents are aware about the Rani Food Products...

4.2(b) Source of customer awareness about Rani Food Products?

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Advertisements 40 40
2 Friends 16 16
3 Retail shops 32 32
4 Sales executives 12 12
5 Any other source 0 0
Total 100 100

(Table.4.3)

(Chart.4.3)

INTERPRETATION

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The table shows that 40% of the respondents came to know about Rani Food Products
through the advertisements of the company.

4.3 Have you used the products of Rani Private Limited?

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Yes 100 100

2 No 0 0
Total 100 100

(Table.4.3)

(Chart.4.3)

INTERPRETATION
The table shows that each one of the respondents is using the products of the Rani
Private Limited.

4.4 Customer’s product usage duration of Rani Private Limited

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Below 6 months 12 12
2 0-1 year 16 16
3 1-2 year 32 32

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 4 Above 2 year 40 40
Total 100 100

( Table.4.4)

(Chart.4.4)

INTERPRETATION
The table shows that 40% of the respondents are using Rani Food Products for more than
two years.

4.5 Advertisements of Rani Food Products have a major influence on

the buying decision of customers.

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Strongly agree 24 24
2 Agree 43 43
3 Average 16 16
4 Disagree 12 12
5 Strongly disagree 5 5
Total 100 100

( Table.4.5)

(Chart.4.5)

INTERPRETATION

67 | P a g e
The table shows that 43% of the respondents agree that advertisements of Rani Food
Products have a major influence on their decision to purchase Rani Food Products.

4.6.1 Influence of price of the Products on customer’s purchase

decision.

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Strongly agree 48 48
2 Agree 32 32
3 Neutral 20 20
4 Disagree 0 0
5 Strongly disagree 0 0
Total 100 100

( Table.4.6)

(Chart.4.6)

INTERPRETATION
The table shows that 48% of the respondents strongly agree that price of the product will
influence their purchase decision.

4.6.2 Influence of quality of the Products on customer’s purchase

decision.

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Strongly agree 22 22
2 Agree 46 46
3 Neutral 14 14

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4 Disagree 11 11
5 Strongly disagree 7 7
Total 100 100

( Table.4.7)

(Chart.4.7)

INTERPRETATION
The table shows that 46% of the respondents agree that quality of the product will
influence their purchase decision.

4.6.3 Influence of availability of the Products on customer’s purchase

decision.

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Strongly agree 29 29
2 Agree 39 39
3 Neutral 9 9
4 Disagree 15 15
5 Strongly disagree 8 8
Total 100 100

( Table.4.8)

(Chart.4.8)

INTERPRETATION
The table shows that 39% of the respondents agree that availability of the product will
influence their purchase decision.

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4.6.4 Influence of brand name of the company on customer’s purchase
decision.

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Strongly agree 23 22
2 Agree 36 19
3 Neutral 0 0
4 Disagree 22 36
5 Strongly disagree 19 23
Total 100 100

( Table.4.9)

(Chart.4.9)

INTERPRETATION
The table shows that 36% of the respondents agree that brand name of the company will
influence their purchase decision.

4.6.5 Influence of previous experience on the products on customer’s

purchase decision.

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Strongly agree 50 50
2 Agree 34 34
3 Neutral 10 10
4 Disagree 6 6
5 Strongly disagree 0 0
Total 100 100

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 ( Table.4.10)

(Chart.4.10)

INTERPRETATION
The table shows that 50% of the respondents strongly agree that the previous experience
on the product will influence their purchase decision.
4.6.6 Influence of advertisements on customer’s purchase decision.

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Strongly agree 38 38
2 Agree 32 32
3 Neutral 2 2
4 Disagree 17 17
5 Strongly disagree 11 11
Total 100 100

( Table.4.11)

(Chart.4.11)

INTERPRETATION
The table shows that 38% of the respondents strongly agree that the advertisements will
influence their purchase decision.

4.6.7 Influence of family/friends opinion on customer’s purchase

decision.

71 | P a g e
 NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Strongly agree 32 32
2 Agree 44 44
3 Neutral 9 9
4 Disagree 7 7
5 Strongly disagree 11 11
Total 100 100

( Table.4.12)

(Chart.4.12)

INTERPRETATION
The table shows that 44% of the respondents agree that the opinions of family/friends
will influence their purchase decision.

4.6.8 Influence of sales promotional activities of the company on

customer’s purchase decision.

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Strongly agree 7 7
2 Agree 22 22
3 Neutral 11 11
4 Disagree 24 24
5 Strongly disagree 36 36
Total 100 100

( Table.4.13)

(Chart.4.13)
72 | P a g e
INTERPRETATION
The table shows that 36% of the respondents strongly disagree that the sales promotional
activities of the company will influence their purchase decision.

4.7.1 Customer’s satisfactory level on Price of Rani Food Products

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Highly satisfied 22 22
2 Satisfied 46 46
3 Normal 14 14
4 Dissatisfied 11 11
5 Strongly dissatisfied 7 7
Total 100 100

( Table.4.14)

(Chart.4.14)

INTERPRETATION
The table shows that 46% of the respondents satisfied with the price of Rani Food
Products.

4.7.2 Quality of Rani Food Products and customer’s satisfactory level

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Highly satisfied 48 48

73 | P a g e
 2 Satisfied 32 32
3 Normal 20 20
4 Poor 0 0
5 Very poor 0 0
Total 100 100

( Table.4.15)

(Chart.4.15)

INTERPRETATION
The table shows that 48% of the respondents are highly satisfied with the quality of Rani
Food Products.

4.7.3 Customer’s satisfactory level on brand name ‘Rani Food Products

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Highly satisfied 36 36
2 Satisfied 45 45
3 Normal 4 4
4 Poor 13 13
5 Very poor 2 2
Total 100 100

( Table.4.16)

(Chart.4.16)

74 | P a g e
INTERPRETATION
The table shows that 45% of the respondents are satisfied with Brand name ‘Rani Food
Products’.

4.7.4 Customer’s satisfactory level on the availability of Rani Food

Products

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Highly satisfied 33 33
2 Satisfied 28 28
3 Normal 23 23
4 Poor 14 14
5 Very poor 2 2
Total 100 100

( Table.4.17)

(Chart.4.17)

INTERPRETATION
The table shows that 33% of the respondents are satisfied with the availability of Rani
Food Products.

4.7.5 Customer’s satisfactory level on the flavors of Rani Food Products

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Highly satisfied 50 50

75 | P a g e
 2 Satisfied 38 38
3 Normal 9 9
4 Poor 3 3
5 Very poor 0 0
Total 100 100

( Table.4.18)

(Chart.4.18)

INTERPRETATION
The table shows that 50% of the respondents are highly satisfied with the flavors of Rani
Food Products.

4.7.6 Customer’s satisfactory level on the aroma of Rani Food Products

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Highly satisfied 42 42
2 Satisfied 28 28
3 Normal 16 16
4 Poor 11 11
5 Very poor 3 3
Total 100 100

( Table4.19).

(Chart.4.19)

INTERPRETATION

76 | P a g e
The table shows that 42% of the respondents are highly satisfied with the aroma of Rani
Food Products.

4.7.6 Customer’s satisfactory level on the packaging of Rani Food

Products

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Highly satisfied 29 29
2 Satisfied 50 50
3 Normal 11 11
4 Poor 10 10
5 Very poor 0 0
Total 100 100

( Table.4.20)

(Chart.4.20)

INTERPRETATION
The table shows that 50% of the respondents are satisfied with the packaging of Rani
Food Products.

4.8. Factors which customers experience on Rani Food Products

SL NO NUMBER OF
PARTICULAR
RESPONDENTS PERCENTAGE
1 Good quality 42 42
2 Affordable price 23 23
3 Timely availability 13 13

77 | P a g e
 4 Easy applicability 10 10
5 Reliability 12 12
Total 100 100

( Table.4.21)

(Chart.4.21)

INTERPRETATION
The table shows that 42% of the respondents ranked that they are mostly satisfied with
the quality of the Rani Food products.

4.9. Satisfaction level of customers on Rani Food Products compared

with the others substitutes available in the market

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Highly satisfied 31 31
2 Satisfied 40 40
3 Neutral 5 5
4 Dissatisfied 16 16
5 Highly Dissatisfied 8 8
Total 100 100

( Table.4.22)

(Chart.4.22)

INTERPRETATION

78 | P a g e
The table shows that 40% of the respondents are satisfied with the Rani Food Products
compared with the others substitutes available in the market

4.10. Family/friends influence on customer’s decision to buy Rani Food

Products

NUMBER OF
PARTICULARS
SL NO RESPONDENTS PERCENTAGE

1 Strongly agree 39 39
2 Agree 36 36
3 Neutral 9 9
4 Disagree 3 3
5 Strongly disagree 13 13
Total 100 100

( Table.4.23)

(Chart.4.23)

INTERPRETATION
The table shows that 36% of the respondents strongly agree that the family/friends
opinion influenced them to buy Rani Food products.

4.2 INFERENTIAL STATISTICS

I. Ho: There is no significant relationship between price of the product and

consumer buying behavior.

Mean Std. Deviation N

Influence of price of
products on buying 4.28 .780 100
behavior
Satisfactory level of
3.65 1.149 100
Rani Food Products

79 | P a g e
 Correlations
Influence of
price of
products on Satisfactory level
buying of Rani Food
behavior Products
Influence of price of Pearson Correlation 1 .866(**)
products on buying Sig. (2-tailed) . .000
behavior Sum of Squares and
60.160 76.800
Cross-products
Covariance .608 .776
N 100 100
Satisfactory level of Rani Pearson Correlation .866(**) 1
Food Products Sig. (2-tailed) .000 .
Sum of Squares and
76.800 130.750
Cross-products
Covariance .776 1.321
N 100 100
** Correlation is significant at the 0.01 level (2-tailed).

Inference:

Since the Correlation is significant at the 0.01 level (2-tailed) the null hypothesis that is
“Ho: There is no significant relationship between price of the product and
consumer buying behavior” is rejected and an alternative hypothesis is framed.

H1: There is significant relationship between price of the product and consumer
buying behavior.

II. Ho: There is no significant relationship between brand name of the company and
consumer buying behavior.

Std.
Mean Deviation N
Influence of brand
name of the
2.81 1.529 100
company on
buying behavior
Satisfactory level
of brand name of
4.00 1.054 100
Rani Private
Limited

80 | P a g e
 Correlations
Influence of
brand name of Satisfactory level
the company on of brand name of
buying Rani Private
behavior Limited
Brand name of the Pearson Correlation 1 .815(**)
company Sig. (2-tailed) . .000
Sum of Squares and
231.390 130.000
Cross-products
Covariance 2.337 1.313
N 100 100
Satisfactory level of Pearson Correlation .815(**) 1
brand name of Rani Sig. (2-tailed) .000 .
Private Limited Sum of Squares and
130.000 110.000
Cross-products
Covariance 1.313 1.111
N 100 100
** Correlation is significant at the 0.01 level (2-tailed).
Inference:

Since the Correlation is significant at the 0.01 level (2-tailed) the null hypothesis that is
“Ho: There is no significant relationship between brand name of the company and
consumer buying behavior.” is rejected and an alternative hypothesis is framed.

H1: There is significant relationship between brand name of the company and
consumer buying behavior.

III. Ho: There is no significant relationship between company advertisements and

consumer buying behavior.

Mean Std. Deviation N

Influence of
advertisement on
3.69 1.412 100
Customer buying
behavior
Influence of
Advertisement of
3.69 1.116 100
Rani Private Limited
on buying decision

Correlations

81 | P a g e
 Influence of
Influence of Advertisement
advertisement of Rani Private
on Customer Limited on
buying behavior buying decision
Influence of Pearson Correlation 1 .919(**)
advertisement on Sig. (2-tailed) . .000
Customer buying Sum of Squares and
behavior 197.390 143.390
Cross-products
Covariance 1.994 1.448
N 100 100
Influence of Pearson Correlation .919(**) 1
Advertisement of Rani Sig. (2-tailed) .000 .
Private Limited on Sum of Squares and
143.390 123.390
buying decision Cross-products
Covariance 1.448 1.246
N 100 100
** Correlation is significant at the 0.01 level (2-tailed).

Inference:

Since the Correlation is significant at the 0.01 level (2-tailed) the null hypothesis that is
“Ho: There is no significant relationship between company advertisements and
consumer buying behavior” is rejected and an alternative hypothesis is framed.

H1: There is significant relationship between company advertisements and

consumer buying behavior.

IV. Ho: There is no significant relationship between family/friends opinion and

consumer buying behavior.

Std.
Mean Deviation N
Influence of
family/friends opinion
3.81 1.261 100
on Customer buying
behavior
Influence of family
friends opinion about
3.84 1.324 100
Rani Private Limited
on buying decision

Correlations

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 Influence of Influence of
family/friends family friends
opinion on opinion about
Customer Rani Private
buying Limited on
behavior buying decision
Influence of Pearson Correlation 1 .974(**)
family/friends opinion on Sig. (2-tailed) . .000
Customer buying Sum of Squares and
behavior 157.390 160.960
Cross-products
Covariance 1.590 1.626
N 100 100
Influence of family Pearson Correlation .974(**) 1
friends opinion about Sig. (2-tailed) .000 .
Rani Private Limited on Sum of Squares and
160.960 173.440
buying decision Cross-products
Covariance 1.626 1.752
N 100 100
** Correlation is significant at the 0.01 level (2-tailed).

Inference:

Since the Correlation is significant at the 0.01 level (2-tailed) the null hypothesis that is
“Ho: There is no significant relationship between family/friends opinion and
consumer buying behavior.” is rejected and an alternative hypothesis is framed.

H1: There is significant relationship between family/friends opinion and consumer

buying behavior.
V. Ho: There is no significant relationship previous experience on the products and
consumer buying behavior.

Std.
Mean Deviation N
Influence of
previous experience
4.00 1.155 100
on consumer's
buying behavior
Consumer
satisfaction about
Rani Food Products 3.70 1.283 100
compared to other
products

Correlations

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 Influence of Consumer
previous satisfaction
experience on about Rani
consumer's Food Products
buying compared to
behavior other products
Influence of previous Pearson Correlation 1 .879(**)
experience on Sig. (2-tailed) . .000
consumer's buying Sum of Squares and
behavior 132.000 129.000
Cross-products
Covariance 1.333 1.303
N 100 100
Consumer satisfaction Pearson Correlation .879(**) 1
about Rani Food Sig. (2-tailed) .000 .
Products compared to Sum of Squares and
other products 129.000 163.000
Cross-products
Covariance 1.303 1.646
N 100 100
** Correlation is significant at the 0.01 level (2-tailed).
Inference:

Since the Correlation is significant at the 0.01 level (2-tailed) the null hypothesis that is
“Ho: There is no significant relationship previous experience on the products and
consumer buying behavior.” is rejected and an alternative hypothesis is framed.

H1: There is significant relationship previous experience on the products and

consumer buying behavior.

5.1 SUMMARY

This document aims at providing marketing department and management

members with the information that can be beneficial both personally and professionally.
Every business enterprise has multiple objectives including of adequate profit for
payment of a reasonable rate of return to the owners and for investment in business
through satisfaction of customers, maintenance of a contended workforce and creation of
a public image. The basic job of marketing department is to understand the needs and
wants of the customers and produce goods and services for satisfying consumer’s needs
and wants. So it is very important before launching a new product survey of consumer

84 | P a g e
behavior is necessary to find out whether a particular product will sell or not so that
accordingly investment decision is taken.

The food manufacturing industry is one industry where there is cut throat
competition. The customers have number of alternatives to choose from. When there is
number of alternatives increases, the consumers use such strategies which eliminate a
number of early stages so it is the objective of the organization to gain a good name in
the minds of consumers.

This project entitled as “factors influencing buying behavior of non-durable

goods” was done to find out the factors which will influence the behavior of consumers
while they take decision to purchase non-durable goods. The study undertakes various
efforts to analyze all of them in great details. The researcher in this project at the outset
gives the clear idea of the entire department existing in the company and also the
products produced by the Rani Private Limited. From the study, the researcher was able
to find some of the important factors which will influence the consumer behavior while
they take decision to purchase non-durable goods. Factors like price, brand name,
advertisement, reference group, previous experience, accessibility and quality of the
products are very much affect the consumer behavior. It is also clear from the study that
the company is so eager in satisfying the expectations of their consumers and their
present effort for it is so far effective.

5.2 FINDINGS
The findings of the study are follows

• The Rani Private Limited has a well defined organization structure.

• Among the target market most of the people are well aware about the Rani Food
Products.
• Most of the customers are using the products of the company for more than two
years
• From the study it is clear that majority of respondents are highly satisfied with
products of Rani Private Limited.

85 | P a g e
 • The advertisements of Rani Private Limited have influenced the buying decision
of the customers.
• From the study it is clear that most of respondents agrees to the fact that the
quality, availability of the product and brand name, advertisement, sales
promotional activities of the company, previous experience had influenced their
buying behavior.
• Majority Respondents are agreeing that the opinions of friends or relatives about
a product will influence their purchase decision.
• Price of the Rani Food products is affordable according to the most of the
respondents.
• Majority of the respondents are highly satisfied with the quality of the Rani Food
Products.
• The study reveals that the most of the respondents are satisfied with availability,
flavors, aroma, packaging and brand name of Rani Food Products.

5.3 SUGGESTIONS

The suggestions for the findings from the study are follows

• Presently the company is more concentrates only on a small segment of Kerala;

the study reveals that the company has the potential for capturing the market all
over the state. So the company can expand its target market.

• From the study, it is clear that the sales promotional activities have a significant
influence on the consumer’s buying behavior. So the company should give due
importance for sales promotional activities for attracting more customers.

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 • The company can improve the package designs of the products, so that company
can attract more customers by stealing the competitor’s market share.

• From the study, it is found that the advertisements of Rani Private Limited is not
so impressive compared to competitors, so that company should improve the
advertisement campaign.

5.4 LIMITATIONS OF THE STUDY

The limitations of the study are the following

• Questionnaire method was used for data collection .The limitation of

questionnaire method is applicable to this study.

• Since the study is conducted only in Malapuram and Calicut districts, it does not
possible to take overall conclusion.

• The findings of this study cannot be generalized because the study is only
conducted among the customer’s of Rani Private Limited.

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 • The investigator intended to cover only few areas of the topic relevant to the
proposed study. As the study was done in a limited time, investigator could not
select large sample for the study

5.5 CONCLUSION

Food manufacturing industry has its own relevance and need in today’s world.
Rani Private Limited is one of the food manufacturing companies in Kerala. The study
conducted on the “FACTORS INFLUENCING BUYING DECISIONS OF NON-
DURABLE GOODS” states the various factors which have influence on consumer’s
buying behavior.

The study was conducted among 100 employees and collected information
through structured questionnaire. The study helped to findings which were related with
customer’s buying behavior and company’s marketing strategies for attracting them.
In the Food manufacturing industry especially in Kerala there is tough competition is
going on because of large number of competitors and various alternatives available to the
customers. In order to meet the tough competition each company in the industry have to

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attract more and more people towards their products. The main way to attract the
customers is to understand factors which are influencing their buying behavior.

The organization can still concentrate on specific areas which are evolved from
this study in order to make the customers more satisfied. Only if the customers are
properly served- they will purchase the product again. The suggestions of this report may
help in this direction. The study helps to understand about the food manufacturing
industry and also helps to know about the current trend in the market, sales and demand.

5.6 SCOPE FOR FUTURE RESEARCH

The present study on factors influencing consumer buying behavior of non-

durable goods helps to get clear picture about the factors which influence the customers
on their purchase of non durable goods. This in turn helps the management to formulate
suitable policy to attract more customers. Hence, the marketing strategies of the company
may also change.

The study of consumer behavior is so vast because consumers all around world
are not the same and the difference in consumer behavior between countries are
increasing. Because all aspects of consumer behavior are culture bound and not subject
to merely environmental factors but integrated in all of human behavior. There is further
scope for conducting research on areas like

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 • Factors influencing the consumer purchase decision of durable goods.

• Affect of sales promotional activities on consumer purchase behavior.

• Influence of media on buying behavior

• Influence of consumer personality on purchase decision

• Motive behind purchase decision

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