Professional Documents
Culture Documents
Submitted By
Team Blitzkreig
IIM Lucknow
Member Details
Supplementary Objectives
Proposed Strategy
Recommendation:
“RapidBuy” Online ordering system
R rders
A Retail O
Retailer
P
I
Plant D
B
U
Y Direc
t orde
rs
Customer
RapidBuy Advantages
• No intermediary distributor or warehouse
required
• Can keep giving high margins to retailers
• Savings on Warehouse costs will bring Gross
Margin up
• Assuming this cost = 9% of Revenue (equivalent
average of competitor’s margin to distributors)
•
• Evidence of Viability
• Rapid technological development/stability in
India
• Retail purchase – Higher margins incentivize
retailers
• Direct Purchase - NRIs & convenience oriented
(upper mid class)
• Can make direct bulk orders
• Cost less to customer even on paying transport
& logistics cost
Short Term Objective Realised
ordering system:
• Positive earnings by the end of Year 2 (Appendix 1.4 for
detailed table)
Assumptions
Plant 1 at present
Green Peas start in plant 1
Plant 2 Total Turnover Rs . 450
= Crores
Assumptions
• CAGR of 30% (average of current & market growth)
• XYZ will gain 5% market share in “Green Peas” in 1st year of
Green Peas production
• Rs.30 crores for Plant 2 will be funded through Loans / family or
Angel investment
• Plant 2 will be ready for production in 2 years
Limitations
Advertisement Objective
Communication Strategy
Packaging Promotion
Domestic Retail-Branding and Promotion
Target Segment
Internal promotion of Frozen Vegetables (XYZ’s share - 1% of market size with Frozen Indian br
Tie-in Promotions
(Package Deals)
Direct Marketing
Personal emails, online Ads –Target NetSavvy consumers, Attractive Online
Promotion
Social Media and using facebook, twitter, orkut and even linked-in – tagging to “Rapi
Social Networking
Appendix 1.1
YoYgrowth rate for demand for green peas in Asia ~ 5%. Assuming the same for Indian
markets, latent demand for frozen green peas in India in Us $ mln and Rs cr(exchange rate : 1
US $ = Rs 48).
Year 2006 2007 2008 2009 2010 2011
US $ mln 48.57 50.9985 53.54843 56.22585 59.03714 61.989
Rs crore 233.136 244.7928 257.0324 269.8841 283.3783 297.5472
Source: The 2006-2011 World Outlook for Frozen Green Peas by Professor Philip M. Parker, Ph.D.
Eli Lilly Chaired Professor of Business, Innovation and Society INSEAD
Appendix 1.1 ctd
Using the data given, finding the market size of each product segment:
Prod Category Share of Revenue XYZ Market Share Total Market Size
Breads 45 42 107.14
Snacks 25 5 500
Non V Snacks 15 2 750
Frozen vegetables 5 1 500
Others 10 5 200
From previous table, market size of green peas in 2010 = Rs 283.38 cr.
Market Size of Frozen vegetables in 2010 = Rs 500 cr.
Percentage share of green peas = 56.67%
Appendix 1.2
Rs . Crore year -> 0* 1 2 3 4 5
Plant 1 Original Sales @ 100.00 130.00 169.00 219.70 285.61 371.29
30% growth yoy
Plant 2 60% of orig. sales - - 131.82 171.37 214.21
North-West market
(40%) + GreenPeas + Total sales from both
plants
442 . 70
(60%)
All Figures in Rs . Crores * Year 0 = 2009 - 2010
( reference year )
Appendix 1.3
Projected Growth in Freezer Space in India
Source: http://www.technopak.com/Perspective/vol3/Opportunities%20in%20the%20Packaged
%20Food%20Market%20in%20India.pdf
Appendix 1.4
All figures Year 0 Year 1 Year2 Year3
in Rs. Crores
Warehouse RapidBuy