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PROBLEM

Kanpur confectioneries private limited faces a problem of declining in a sale. They already

closed their candy business due to decline in the sales. They have a capacity of producing 240

tonnes per month of biscuits but they are not able to produce according to their capacity. T hey

already lost Rs 1, 41,000 .And they are not able to handle the competition. Whenever the

in market increase so there sale also decreases.

Objectives

They have to increase their production because they have the capacity of 250 tonnes per month

and they are producing only 170 tonnes per month of biscuits. They have to make proper

strategies for handling competition in market.

OPTIONS

KCPL can accept the proposal of A-ONE confectionaries private limited by

becoming there contract manufacturer. So they can increase their production, they can use

new technology, APL have better distribution in national market and also minimizing the

business risks.

They can continue outsourcing the supply of health biscuits to Pearson health

drinks limited because they are better conversion rate of Rs 3 per kilo after

reimbursing fully the cost of materials

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MAIN REPORT

Kanpur confectionaries private limited started by Mohan Kumar Gupta in Jaipur,

Rajasthan . He started a business of sugar candies under the brand name of

MKG. As the competition increased in this market due to thirty units were set upin the unorganized sector . KCPL cost was higher than the other manufacturers so

mohan kumar faced crisis. So he changed his plant location to Kanpur, Uttar

Pradesh there he advertised MKG in the news paper and hoardings located on

the roads. In the end of sixties he was the leader in candies market. He decided to

invest his surplus in glucose biscuits market the demand in this market increase at

the 15% per annum and the raw materials were very easily available in market. He

tied up with the local merchant and commence production in 1970.He extended his

range to cream, salt and marie biscuits under the brand name MKG. In 1973 KCPL

reached the number two position in the market with the monthly sale of 110 tonne

.A-ONE was the national leader. In 1980-81 there business was of Rs 2 crores then

they doubled their capacity 120 to 240 tonnes per month. In 1983 there sales were

going down due to competition and 1987 they were using old technology but other

was using new technology. The KCPL were depended on permanent and casual

labors. The labors monthly salary was Rs 2.75 lakhs for 90 permanent workers and

casual workers employed on daily basis. The major problem with workers is

absenteesism.

KCPL is the family based company. Mohan Kumar had six sons out of which 3

joined his company other started their own business .MKG was a popular brand in

northern region of India. The main consumer is middle class families in urban and

rural area. In 1973-74 the competition in biscuits market is increased due to

entrance of 70 units