1) HUL: Tapping India (urban) and Bharat (rural) with projects Telecalling, Columbus
Hindustan Unilever has initiated a project each for urban areas and rural markets to double its direct reach and ensure it retains its advantage of having the largest distribution network in the country even as rivals inch closer.
Project Telecalling for urban areas and Project Columbus for rural areas aim to double the country’s top consumer products firm’s direct reach to four-million outlets over the next two years.
A market analyst said the urban initiative has the potential to change the distribution paradigm of the consumer product industry. “Project Telecalling aims to tap the uncovered outlets via telephone calls and deliver the ordered quantity, reducing the cost of additional salesmen to reach such outlets,” Anand Mour of ICICI Securities said in a recent investor note. “Project Telecalling can change the distribution paradigm in the FMCG industry – in our opinion it is easily replicable by other FMCG companies.”
Project Columbus seeks to expand Hindustan Unilever’s distribution reach to over 150-million rural consumers directly in 2013. The move comes at a time rivals such as Procter & Gamble and ITC have been aggressively expanding their reach. Over the past three years, both these firms have invested significant amounts in increasing their footprint with a focus on rural areas. P&G already covers about 5.6-million outlets in the country against HUL’s retail network of over 7.2-million outlets.
2) Parle re-enters cola market after 20 years with Cafe Cuba
Two decades after it hived off its carbonated soft drinks portfolio, Parle Agro announced its re-entry into the Rs 15,000-crore cola market early next year with the launch ‘Cafe Cuba’, a coffee-flavoured carbonated drink.
Even today, after two decades, the Thums Up brand remains so strong that American cola major Coca Cola has not managed to push its global flagship brand Coke, ahead of this locally developed drink, making India the only market in the world, where Coke trails a group brand in market share.
The company plans to roll out Cafe Cuba by January or February 2014 and is aiming to garner a market share of 7 per cent within the very first year of its launch.
3) Ruchi Soya plans to step into ready-to-cook segment
FMCG major Ruchi Soya, which has soya food brand Nutrela and edible oil brand Ruchi under its portfolio, is planning to foray into the ready-to-cook segment soon.
“Going forward, the company is planning to focus on branded products. We will soon enter into the ready-to-cook segment soon, especially in the breakfast category, that may be an integration of soya food,” a company source said here without giving any further details.
According to industry data, the total (organised and unorganised) ready-to-cook and eat market in the country stood at $13 billion in 2013. Ruchi Soya, with a turnover of Rs 26,000 crore, is into cooking oil, palm plantation and also has products under soya foods, bakery fats and vanaspati products.
The company has a very strong presence in the southern and western regions of the country, said Shahra, while speaking on the sidelines of ‘Globe Oil 2013’ here. Ruchi Soya Industries founder and Managing Director Dinesh Shahra said “Going ahead, we will build a strong brand presence in the northern and eastern region of the country,”