PRODUCT LAUNCH OF CANDIES
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INDEX Model/ Features of Product. USP and Tagline. Industry Scenario. Competitors in the Market. SWOT Analysis. Marketing Environment. Which Market Concept Used And Why? Segmentation, Targeting, and Positioning. Consumer Buying Process. Marketing Mix. Product Life Cycle. Labeling Packaging and Advertising.
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Bibliography.
PREFACE
“TRUFFLES CANDY” is a fun and friendly family business that works hard to provide you with the highest quality, most delicious candy on the planet. In this field profits are too good as it is of mass marketing type. Chocolates are on everyone’s mind i.e. young, old, kids….. Everybody likes chocolates... “Company wants to fulfill its mission of serving the society what it wants & desires. At the same time considering and focusing on the health & fitness of the consumers. Youth today are very very health conscious so though they have a desire to eat candy they won’t eat due to they are priority towards their health. Thinking of children’s desires and health, mothers are worried about the fact that whatever children eat today is not nutritional for them& especially when it comes to candies. So taking into consideration children’s desires and mothers’ worries & dilemma of youth, companies’ research and development department has come up with “truffles” & its variants that are low in fat & are as nutritional as grains & vegetables for kids.
INTRODUCTION: TRUFFEL CANDIES is a provider of high-quality, uniquely crafted chocolates. We have developed an alliance with HUL, one of the premier confectioners in the INDIA, to provide us with a range of unique products. The Company concept was initially formed in August of 2000. Upon final approval the company will register an official trademark with the INDIAN Patent and Trademark Office. COMPANY OWNERSHIP It is a privately held partnership firm. It is registered as a Limited Company,
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The company office is located in the owner's residence. Initially, we will not maintain inventories or handle fulfillment, so warehousing facilities will not be necessary. Our plan includes the establishment of an office outside of our residence to house an expanded staff in Year Three. START-UP SUMMARY Almost 40% of start-up funds will go development and product research and includes a new Personal Computer has business and accounting software. The balance of funds will be used to first three months of operation.
towards, administrative, consulting, Web page development costs. Expensed equipment been made in order to run the requisite maintain a positive cash balance for the
OBJECTIVES • To buil build d a sub subst stan anti tial al cash cash bala balanc nce e by by the the end end of of yea year r thr three ee. . • To con contr trib ibut ute e Rs.1 Rs.100 00,0 ,000 00 by by our our thir third d year year to to non non prof profit it org organ aniz izat atio ions ns tha that t assist organizations. • To reac reach h inc incre reas ase e sal sales es tenten-fo fold ld by the the end end of Year Year Thre Three. e. • To pay pay off off any any loa loans ns or equi equity ty inve invest stme ment nts s by by the the end end of of Yea Year r Thr Three ee. . MISSION TRUFFEL CANDIES Designs is dedicated to becoming the premier provider of highquality products to the market for the purpose of raising funds. We will accomplish our mission by: • Form Formin ing g stra strate tegi gic c alli allian ance ces s with with com compa pani nies es and and org organ aniz izat atio ions ns tha that t shar share e our our vision. • Condu nducti cting our bus busi iness ess fai fair rly and and et ethic hicall ally. • Treat eating ing ou our emp emplo loy yees with dig dignity ity and and res respect. ect. MODEL/ FEATURES OF THE PRODUCT Sugar Candy: In most candies sugar is a fundamental ingredient; in fact, some candies are composed entirely of cooked sugar. Even though the candies below all rely on sugar or sugar syrups for their taste and composition, there is still an enormous variety among the confections, ranging from caramels and toffee to fondant, marshmallows, and lollipops. Working With Sugar. Sugar & Hard Candies. Caramel. Toffee. Fondant. Fruit Candy. Nut Candy. Gummy & Gelatin Candy. Marshmallow. Marzipan. Nougat. SPECIAL FEATURES. Accurate sweeteners added. Sugar free candy also available. Different flavors of natural origin.
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USP of our product is that our product “truffles” and its variants is that it is sugar free, is low in fat and calories and provides necessary nutritional values and is available at affordable prices. In short it is “BEST QUALITY, VARIETY AND VALUE AT AFFORDABLE PRICE”. The strategy focused is to stay close to the customers, understanding their needs, and exceeding their expectations. 1. 2. 3.
Its di different fl flavors. Natu Natura ral l ori origi gin n of of swe sweet eten ener ers s and and flav flavor ors. s. High qu quality at at ec economic pr price. TAGLINE
“THE TASTE YOU CAN’T RESIST”
INDUSTRY SCENARIO The wholesale candy industry has gone through so many changes in the last 50 years it is incredible. The industry has evolved from many small players in the early 1960's and 1970's to a much smaller set of mid sized to huge wholesale candy suppliers. Manufactures are also much stricter with the criteria needed to buy direct. The industry consolidation has also required the wholesale candy supplier to carry a broad product base. This is required as customers are looking for one stop shopping. Many wholesale candy companies are being bought by the larger ones, are forced out of business or if lucky can find a niche area to play in. Adding to the industry pressures are wholesale candy price increases. While candy prices have continued to increase over the last few years in 2007 and 2008, customers are often very price conscious and demanding. Recently written in Professional Candy Buyer magazine is an article citing how Hershey and Mars announced that due to the rising cost of milk and cocoa it is raising its prices again. This is the second time in a year now. This increase is said to raise wholesale prices about 12% and 11% respectively. This is on top of a 5% increase in April 2008. For Hershey the increase will take effect immediately and Mars the increases will be introduced through March 2009. Energy and commodity prices are said to be the cause of the increases. The increase in costs has gotten to such a point that there are even discussions on modifying the standards to lower cocoa butter contents to save costs. Currently the existing federal standard for chocolate says that chocolate in its purest state must contain between 50% and 60% cocoa butter. The proposal includes using a vegetable fat to supplement the
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sales offer the opportunity for the small candy wholesaler to have a large look and presence. While website design and maintenance will cost money it is possible that revenues can increase to defer the costs. In addition the costs of hiring a sales force can also be reduced.
COMPETITORS IN MARKET ALPENLIEBE Alpenliebe, a hard-boiled sugar candy, was one of the first brands to be launched after Perfetti Van Melle (India) Ltd. (PVMI) launched its operations in India in 1994. A wholly-owned subsidiary of the world's third largest confectionery major Perfetti Van Melle S.p.A, PVMI also had other big brands such as Center Fresh, Big Babol, Chlormint, Mentos, Happydent White, Marbles, Chocoliebe, etc., in its brand portfolio. HAJMOLA CANDY The zingy tangy candy that's fun to have any time of the day. And what's more, it gets your digestive juices working better. That's a great way to enjoy while staying healthy – with Hajmola Candy's khatta meetha taste and 3 fun-filled flavours. FUNDA MINT The latest entrant in the 50p mint category in India is Fundamint. It seems to peg its differentiation on Indian ingredients like saunf (fennel seeds) and hence the positioning: dil se desi . Funda Mint - "Mint with a twist": India has extremely diverse taste requirements. Gujaratis love a sweet touch to their foods, whereas people from Andhra Pradesh prefer their food to be extremely spicy. On this thought, Funda-Mint took birth to provide the Indian consumer with a mint that refreshes them instantly and ensures it caters to India’s varied taste. A mint that is modern but is essentially "Dil Se Desi". Currently available in 2 flavours – Saunf Fresh & Double Thanda. While Double Thanda provides you that extra strong mint to freshen your breath in an instant, Saunf Fresh gives you mint freshness in a unique flavor that Indians are used to having after a meal.
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tagline " Pyar Do Pyar Lo" which translates to " Give Love ,Take Love".
S.W.O.T Analysis The over all evaluation of a company’s strength, weaknesses, opportunities and threats is called SWOT analysis. The SWOT analysis is divided into two parts. The first one is the internal environment from where the strength and weaknesses of the organization can be identified and the second one is the external environment which contains the opportunities the company can avail of and the threats that the company may have to face. The S.W.O.T analysis of our organization is as follows, STRENGTHS • Tota Totall lly y inn innov ovat ativ ive e prod produc uct t – the the prod produc uct t whi which ch we are are abo about ut to laun launch ch is a totally innovative product which is going to be introduced in the Indian market. • Pate Patent nted ed prod produc uct t – our our prod produc uct t is is pat paten ente ted d for for thre three e yea years rs, , thi this s pro prote tect cts s our product from being copied by other competitors. • Nati Nation on wide wide laun launch ch – we we are are plan planni ning ng to laun launch ch our our prod produc uct t thr throu ough ghou out t the the city. • Low Low cos cost t of of pro produ duct ctio ion n – the the prod produc ucti tion on line line is usin using g the the lat lates est t tec techn hnol olog ogy y which will help in mass production so that we can enjoy economies of scale. WEAKNESS • As it is goin going g to to be be a tot total ally ly new new pro produ duct ct bein being g int intro rodu duce ced d into into the the mar marke ket, t, acceptance by the public those who are used to particular brand for a long time, will be at a low. • The The gre great ates est t dra drawb wbac ack k to to the the com compa pany ny will will be if the the pro produ duct ct is not not ava avail ilab able le to the consumer. • As we are are lau launc nchi hing ng new new pro produ duct ct in the the mar marke ket t cos cost t of of pro produ duct ctio ion n wil will l be be high and revenue will be low. OPPORTUNITIES • Peop People le want want to eat eat choc chocol olat ates es at the the same same time time rema remain in fit fit in in shap shape e • Candi ndies are are con cons sume umed by by 90% 90% of the the po popul pulati ation • Candi ndies are are con cons sume umed by by peo peop ple of all all age age gro group up • As we are are com compl plet etel ely y new new to the the fie field ld of the the can candi dies es, , the there re is a wid wide e opportunity of getting accepted since the present generation does not believe in sticking to old and outdated products. They are always in search of something new and believe in getting the best for what they spend. • We have have asso associ ciat ated ed with with a fam famou ous s dis distr trib ibut utio ion n agen agenci cies es in Indi India a to to hel help p us reach our product to the nook and corners of urban/rural India THREATS • Bigg Bigges est t thr threa eats ts are are com compe peti tito tors rs who who are are alre alread ady y pre prese sent nt in the the mar marke ket t • Ther There e is is a thr threa eat t of of the the dupl duplic icat atio ion n or or che cheap ap subs substi titu tuti tion on. . • We have have thre threat ats s fro from m the the MNC’ MNC’s s if if the they y mak make e sub subst stit itut uted ed prod produc ucts ts with with similar advantages. • NonNon-ac acce cept ptan ance ce due due to comp comple lete tely ly inno innova vati tive ve idea idea
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three key perspectives on the marketing environment, namely the 'macro environment,' the 'micro-environment' and the 'internal environment’. The micro-environment This environment influences the organization directly. It includes suppliers that deal directly or indirectly, consumers and customers, and other local stakeholders. Micro tends to suggest small, but this can be misleading. In this context, micro describes the relationship between firms and the driving forces that control this relationship. It is a more local relationship, and the firm may exercise a degree of influence. The macro-environment This includes all factors that can influence and organization, but that are out of their direct control. A company does not generally influence any laws (although it is accepted that they could lobby or be part of a trade organization). It is continuously changing, and the company needs to be flexible to adapt. There may be aggressive competition and rivalry in a market. Globalization means that there is always the threat of substitute products and new entrants. The wider environment is also everchanging, and the marketer needs to compensate for changes in culture, politics, economics and technology. The internal-environment All factors that are internal to the organization are known as the 'internal environment'. They are generally audited by applying the 'Five Ms' which are Men, Money, Machinery, Materials and Markets. The internal environment is as important for managing change as the external. As marketers we call the process of managing internal change ‘internal marketing’.
WHICH MARKETING CONCEPT USED AND WHY??? PRODUCT CONCEPT This concept states that consumer will favour those products that offer most quality performance and innovative features. So according to this as candies is a product which keeps on changing with innovative features. This concept also totally devotes itself to providing varied features in the product so as to sell more. Managers of such organizations focus on making superior products and improving them overtime.
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markets (called segments). These segments are homogeneous within (i.e. people in the segment are similar to each other in their attitudes about certain variables). Because of this intra group similarity, they are likely to respond somewhat similarly to a given marketing strategy. That is, they are likely to have similar feeling and ideas about a marketing mix comprised of a given product or service, sold at a given price, distributed in a certain way, and promoted in a certain way. A market segment consists of a group of customers who share a similar set of needs and wants. Consumer segments can be segmented using several bases: Geographic segmentation Demographic segmentation Psychographic segmentation Behavioral segmentation TARGETING A target market is the market segment which a particular product is marketed to. It is often defined by age, gender and/or socio-economic grouping. Targeting strategy is the selection of the customers you wish to service. The decision involved in targeting strategy includes: Which segments to target? How many products to offer? Which products to offer in which segments? There are three steps to targeting 1. Market Segmentation 2. Target Choice 3. Product Positioning Patterns of target market selection: 1. Single-segment concentration 2. Selective spe specialization 3. Product specialization 4. Market sp specialization 5. Full market coverage POSITIONING In marketing, positioning is the technique by which marketers try to create an image or identity in the minds of their target market for its product, brand, or organization. It is the relative competitive comparison your product occupies in a given market as perceived by the target market. Positioning is something (perception) that is done in the minds of the target market. A product’s position
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the prospect. Hence our basic approach will not be to create something new and different in the minds of our prospective consumers but to manipulate what’s already up in their mind. Positioning Statement TRUFFEL CANDIES Designs' products give the customer a high-quality product that has true value and also allows them to contribute toward a cause. For fund-raising function coordinators who are looking for a distinctive product to make a lasting impression, TRUFFEL Chocolates will more than meet that need. Currently, those event coordinators do not have such a distinctive product. Pricing Strategy Our pricing strategy will be developed by comparing our products to other like products and then taking into consideration what the market will bear. We are selling a unique product for a specific reason -- to raise money for benevolent programs. Because of this approach, we will be able to price our product slightly higher than comparable products in the market. Sourcing Sourcing is critical for any enterprise, especially a retail operation. TRUFFEL CANDIES Design's first line of products - high quality chocolates- will be produced exclusively by HUL of INDIA. We have entered into a non-binding agreement with HUL’s, which can handle large volumes of product. Orders will be placed through OUR main office and then communicated to HUL’s for fulfillment. This will ensure the most expedient delivery and the freshest product possible. Advertising will be outsourced. Most sales promotions and public relations work are handled in-house by Deepali Rathi. Professional administrative and consulting tasks will also be outsourced CONSUMER BUYING PROCESS
If a marketer can identify consumer buyer behavior, he or she will be in a better position to target products and services at them. Buyer behavior is focused upon
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4 PS MARKETING MIX the marketing mix is probably the most famous marketing term. Its elements are the basic, tactical components of a marketing plan. Also known as the Four P's, the marketing mix elements are price, place, product, and promotion. The concept is simple. Think about another common mix - a candy mix. All candies contain essence, starch , flour, and sugar. However, you can alter the final candy by altering the amounts of mix elements contained in it. It is the same with the marketing mix. The offer you make to you customer can be altered by varying the mix elements. So for a high profile brand, increase the focus on promotion and desensitize the weight given to price. Another way to think about the marketing mix is to use the image of an artist's palette. The marketer mixes the prime colours (mix elements) in different quantities to deliver a particular final colour. Every hand painted picture is original in some way, as is every marketing mix. Some commentators will increase the marketing mix to the Five P's, to include people. Others will increase the mix to Seven P's, to include physical evidence and process. PRODUCT A product is anything that can be offered to a market to satisfy a want or need. Products that are marketed include physical goods, services, experiences, events, persons, places, properties, organizations, information and ideas. For many a product is simply the tangible, physical entity that they may be buying or selling. You buy a new car and that's the product - simple! Or maybe not. When you buy a car, is the product more complex than you first thought? PRICE Price is the second element of the marketing mix. Price is the value exchange that occurs between buyers and sellers for a product or service. It is a vital decision area in marketing that generates revenue. Price is the most important determinant of the profitability of the business. Factors related to price include legal and regulatory guidelines, pricing objectives, pricing strategies, and options for increasing sales. PLACE The third element of the marketing mix is place. Place refers to having the right product, in the right location, at the right time to be purchased by consumers. This proper placement of products is done through middlemen called the channel of distribution. The channel of distribution is comprised of interdependent manufacturers, wholesalers, and retailers. Each participant in the channel of distribution is concerned with three basic utilities: time, place, and possession.
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superior competitors, it goes into decline and is eventually withdrawn However, most products fail in the introduction phase. Others have very cyclical maturity phases where a decline sees the product promoted to regain customers.
STRATEGIES FOR THE DIFFERING STAGES OF THE PRODUCT LIFE CYCLE Introduction
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products are introduced or consumer tastes have changed. There is intense pricecutting and many more products are withdrawn from the market. Profits can be improved by reducing marketing spend and cost cutting. LABELLING, PACKAGING AND ADVERTISING LABELLING Indian Food Inspection Agency (IFIA) carries joint responsibility for federal food labeling policies in INDIA under the Food and Drugs Act. IFIA Activities include: • Inve Invest stig igat atin ing g cons consum umer er and and indu indust stry ry comp compla lain ints ts, , • Deve Develo lopi ping ng pro progr gram ams s desi design gned ed to to enco encour urag age e comp compli lian ance ce wit with h the the prov provis isio ions ns of of the respective Acts, • Devel velopi oping consu nsumer mer pro protec tectio tion pol polici icies. The food label is one of the most important and direct means of communicating product information between buyers and sellers. It is one of the primary means by which consumers differentiate between individual foods and brands to make informed purchasing choices. A label serves three primary functions. • It prov provid ides es basi basic c pro produ duct ct info inform rmat atio ion n (in (incl clud udin ing g com commo mon n nam name, e, list list of ingredients, net quantity, durable life date, grade/quality, country of origin and name and address of manufacturer, dealer or importer). • It prov provid ides es heal health th, , saf safet ety, y, and and nut nutri riti tion on info inform rmat atio ion. n. This This incl includ udes es instructions for safe storage and handling, nutrition information such as the quantity of fats, proteins, carbohydrates, vitamins and minerals present per serving of stated size of the food, and specific information on products for special dietary use. • It acts acts as a veh vehic icle le for for foo food d mar marke keti ting ng, , pro promo moti tion on and and adv adver erti tisi sing ng (via (via label, promotional information and label claims such as "low fat", "cholesterol-
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Break-even Analysis
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Cash fr from Re Receivables 8,54,900 19,54,300 70,88,000 Subtotal Subtotal Cash Cash from Opera Operation tions s 1,98,98, 1,98,98,000 000 4,22,02 4,22,02,200 ,200 15,80,31 15,80,31,600 ,600 Additional Cash Received Sales Tax, VAT, HST/GST Received 0 0 0 New Current Borrowing 0 0 0 New Other Liabilities (interest-free) 0 0 0 New Long-term Liabilities 0 0 0 Sales of Other Current Assets 0 0 0 Sales of Long-term Assets 0 0 New Investment Received 0 0 0 Subtot Subtotal al Cash Cash Receiv Received ed 1,98,9 1,98,98,0 8,000 00 4,22, 4,22,02, 02,20 200 0 15,80, 15,80,31, 31,600 600 Expenditures
FY 2009
FY 2010
FY 2011
Expenditures from Cash Spending Bill Payments Subtot Subtotal al Spent Spent on
Operations 40,00,000 1,32,00,000 2,17,60,000 1,34,38,200 2,77,61,900 10,26,57,400 Opera Operatio tions ns 1,74, 1,74,38, 38,200 200 4,09,6 4,09,61,9 1,900 00 12,44 12,44,17 ,17,40 ,400 0
Additional Cash Spent Sales Tax, VAT, HST/GST Paid Out 0 0 0 Principal Repayment of Current Borrowing 0 0 Other Liabilities Principal Repayment 0 0 Long-term Liabilities Principal Repayment 0 0 Purchase Other Current Assets 0 0 0 Purchase Long-term Assets 0 0 18,00,000 Dividends 0 0 0 Subto ubtot tal Ca Cash Spe Spent 1,74, ,74,3 38,2 8,200 4 09 61,9 61,90 00 12,62 2,62
0 0 0
17 400 400
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relationships with key companies and organizations. The sales goal for Year One is conservative and realistic. We feel that doubling sales in Year Two is very attainable and necessary to fund marketing and personnel objectives. Net profits are reduced in Fiscal Year 2010 as staff members are added and marketing expenditures are increased. This strategy will allow truffle candies Designs to attain the aggressive sales goal in Fiscal Year 2011. Pro Forma Profit and Loss FY 2009 FY 2010 FY 2011 Sales 2,00,453 4,23,663 15,88,880 Direct Cost of Sales 1,00,233 2,11,832 Other Production Expenses 0 0 Total Cost of Sales 1,00,233 2,11,832 Gross Ma Margin Gross Margin %
1,00,220 50.00%
Expenses Payroll 40,000 Sales and Marketing and Depreciation 792 Leased Equipment 0 Utilities 3,000 5,000 Insurance 3,600 3,600 Rent 0 5,000 9,600 Payroll Taxes 6,000 Other 0 0 0
2,11,831 50.00%
7,94,441 7,94,441
7,94,439 50.00%
1,32,000 2,17,600 Other Expenses 27,300 1,600 1,600 0 10,000 6,000 3,600 19,800
32,640
44,500
1,17,500
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Projected Balance Sheet All of our tables will be updated monthly to reflect past performance and future assumptions. Future assumptions will not be based on past performance but rather on economic cycle activity, regional industry strength, and future cash flow possibilities. We expect solid growth in net worth beyond the year 2010. Pro Forma Balance Sheet FY 2009 FY 2010 FY 2011 Assets Current Assets Cash 60,09,800 72,50,100 3,90,64,300 Accounts Receivable 1,47,300 3,11,400 Other Current Assets 0 0 0 Total Current Assets 61,57,100 75,61,500
11,67,800 4,02,32,100
Long-term Assets Long-term Assets 0 0 18,00,000 Accumulated De Depreciation 79200 2,39,200 3,99,200 Total Long-term Assets -79200 -2,39,200 14,00,800 Total Assets 60,77,900 73,22,300 4,16,32,900
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BIBLIOGRAPHY:http://marketingpractice.blogspot.com/2007_01_01_archive.html