1. INTRODUCTION OF FOOD INDUSTRIES

The food industry is a complex, global collective of diverse businesses that together

supply much of the food energy consumed by the world population. Only subsistence

farmers, those who survive on what they grow, can be considered outside of the scope

of the modern food industry.

The food industry includes:

Regulation: local, regional, national and international rules and regulations for food

production and sale, including food quality and food safety, and

industry lobbying activities

Education: academic, vocational, consultancy

Research and development: food technology

Financial services insurance, credit

Manufacturing: agrichemicals, seed, farm machinery and construction, etc.

Agriculture: raising of crops and livestock, seafood

Food processing: preparation of fresh products for market, manufacture of prepared

food products

Marketing: promotion of generic products (e.g. milk board), new products, public

opinion, through advertising, packaging, public relations, etc.

Wholesale and distribution: warehousing, transportation, logistics

Definitions

It is challenging to find an inclusive way to cover all aspects of food production and

sale. The Food Standards Agency, a government body in the UK, describes it thus:

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"...the whole food industry – from farming and food production, packaging and

distribution, to retail and catering."[1]

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."

1.1 FOOD INDUSTRY IN INDIA

India is the world's second largest producer of food next to China, and has the potential

of being the biggest with the food and agricultural sector. The total food production in

India is likely to double in the next ten years and there is an opportunity for large

investments in food and food processing technologies, skills and equipment, especially

in areas of Canning, Dairy and Food Processing, Specialty Processing, Packaging,

Frozen Food/Refrigeration and Thermo Processing. Fruits & Vegetables, Fisheries,

Milk & Milk Products, Meat & Poultry, Packaged/Convenience Foods, Alcoholic

Beverages & Soft Drinks and Grains are important sub-sectors of the food processing

industry.

Health food and health food supplements is another rapidly rising segment of this

industry which is gaining vast popularity amongst the health conscious. 

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2. COMPANY PROFILE

2.1 INTRODUCTION

Parle Products has been India's largest manufacturer of biscuits and confectionery for

almost 80 years. Makers of the world's largest selling biscuit, Parle-G, and a host of

other very popular brands, the Parle name symbolizes quality, nutrition and great taste.

With a reach spanning even to the remotest villages of India, the company has

definitely come a very long way since its inception.

Many of the Parle products - biscuits or confectioneries, are market leaders in their

category and have won acclaim at the Monde Selection, since 1971. With a 40% share

of the total biscuit market and a 15% share of the total confectionary market in India,

Parle has grown to become a multi-million dollar company. While to the consumers it's

a beacon of faith and trust, competitors look upon Parle as an example of marketing

brilliance.

Available Anywhere

Today, the great strength of Parle Products is the extremely widespread distribution

network

2.2 ABOUT THE COMPANY

History

Parle Product’s fame and familiarity is undeniable. Considering its extensive reach,

the brand Parle is known and recognized by everyone. Over the years, Parle’s sweets

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and biscuits have become a household name. From kids to adults, everyone loves and

cherishes these treats. It gives us great pleasure to see our consumers enjoy and

embrace Parle products on daily basis. Our confectioners and chefs have the utmost

authority at Parle. Had it not been so, the beginning of Parle would have been quite

different.

In 1929 a small company by the name of Parle products emerged in British

dominated India. The goal was to spread joy and cheer to children and adults alike,

all over the country with its sweets and candies. Although, the company knew that it

wouldn’t be an easy task, they decided to take the brave step. A small factory was set

up in the suburbs of Mumbai to manufacture confectionery products. A decade later

this factory was upgraded to manufacture biscuits as well. Since then, the Parle name

has spread in all directions and has won international fame. Parle has been

sweetening the lives of people all over India and abroad.

Apart from the factories in Mumbai and Bangalore, Parle also has factories in

Bahadurgarh, Haryana and Neemrana, Rajasthan. These are the largest biscuit and

confectionery plants in the country. Additionally, Parle Products also has 10

manufacturing units and 75 manufacturing units on contract.

A cream colored yellow stripped wrapper with a cute baby photo containing

10 – 12 biscuits with the company’s name printed in Red and you know these are

Parle G biscuits. Times changed, variety of biscuits did come and go but nothing

has changed with these biscuits. Yes, the size of their packing has definitely

changed but for the consumers good as these are money savers pack.

The Parle name conjures up fond memories across the length and breadth of the

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country. After all, since 1929, the people of India have been growing up on Parle

biscuits & sweets.

Initially a small factory was set up in the suburbs of Mumbai city, to

manufacture sweets and toffees. The year was 1929 and the market was dominated

by famous international brands that were imported freely. Despite the odds and

unequal competition, this company called Parle Products, survived and succeeded,

by adhering to high quality and improvising from time to time.

A decade later, in 1939, Parle Products began manufacturing biscuits, in

addition to sweets and toffees. Having already established a reputation for quality,

the Parle brand name grew in strength with this diversification. Parle Glucose and

Parle Monaco were the first brands of biscuits to be introduced, which later went on

to become leading names for great taste and quality.

For around 75 years, Parle have been manufacturing quality biscuits and

confectionery products. Over the years Parle has grown to become a multi million-

dollar company with many of the products as market leaders in their category. The

recent introduction of Hide & Seek chocolate chip biscuits is a product of

innovation and caters to a new taste, being India’s first ever chocolate-chip

biscuits.

All Parle products are manufactured under most hygienic conditions. Great

care is exercised in the selection and quality control of raw material and standards

ensured at every stage of the manufacturing process.

Parle Products has 4 manufacturing units for biscuits and confectionaries at

Mumbai, Haryana, Rajasthan and Karnataka. It also has 14 manufacturing units for

biscuits & 5 manufacturing units for confectioneries, on contract. All these factories

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are located at strategic locations, so as to ensure a constant output & easy

distribution.

Today, Parle enjoys a 40% share of the total biscuit market and a 15% share

of the total confectionary market, in India.

Milestones - The Decades of Progress

1929:The first year of operation. Our only assets were hard work and hope.

1939:Ten years of determined effort brought results. Things began to take shape. And

we tried even harder.

1949:The formative years were over. We had come of age.

1974:Here was the first evidence of Parle as it is today.

2.3 QUALITY

Hygiene is the precursor to every process at Parle. From husking the wheat and

melting the sugar to delivering the final products to supermarkets and store shelves

nationwide, care is taken at every step to ensure the best product of long-lasting

freshness. Every batch of biscuits, confectioneries & snacks are thoroughly checked

by expert staff, using the most modern equipment. This ensures consistent and perfect

quality across the nation and abroad.

Concentrating on consumer tastes and preferences, the Parle brand has grown from

strength to strength ever since its inception. The factories at Bahadurgarh, Haryana

and Neemrana, Rajasthan are the largest biscuit and confectionery plants in the

country. The factory in Mumbai was the first to be set up, followed soon by the one

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in Bangalore, Karnataka. Parle also has 10 manufacturing units for biscuits and 75

manufacturing units for confectioneries on contract. 

2.4 CORE VALUES

An in-depth understanding of the Indian consumer psyche has helped Parle develop a

marketing philosophy that reflects the needs of the Indian masses. With products

created bearing in mind both health and taste, Parle products equally appeal to fun

loving kids & youth. Even today, the great tradition of taste and nutrition is consistent

in every pack on the store shelves. The value-for-money positioning allows people

from all classes and age groups to enjoy Parle products to the fullest. 

2.5 MARKETING MIX OF PARLE PRODUCTS LIMITED

The marketing mix of Parle for this project has been studied from the point of

view of Parle biscuits; mainly Parle-G and Parle hide & seek.

Product Levels

1) Core benefit- the core benefit of biscuits is to satisfy hunger of the consumer

2) Basic product- in the second level, the basic product is biscuits.

3) Expected product- the consumers expect the product to have a good taste and

also give nutrition.

4) Augmented product- parle biscuits increase a person’s energy levels. This is not

always expected by the consumers and hence exceeds customer’s expectations.

5) Potential product- in the future parle could come up with different products such

as a snack which could be a combo of chocolate and biscuit.

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Classification of products

1) Based on tangibility- Parle biscuits are tangible, i.e. one can see and touch them.

2) Based on functional life- Parle biscuits are consumables since biscuits form a

part of food and have a short life.

3) Based on price and quality- most of Parle biscuits such as Parle-G, Monaco,

Krackjack are mass products but a few Parle biscuits such as Parle hide and seek

and Milano are premium or prestige products.

4) Based on utility- Parle biscuits are convenience goods. They are staples since

they are bought by consumers regularly. Also they are partly impulse products.

2.6 PRODUCT MIX

• Width- Parle produces biscuits, snacks and sweets. So the width is 3.

• Length- the length of Parle products is as below

PRODUCT BASKET OF PARLE

PARLE BUSCUITS    

Parle - G Hide and Seek

Krackjack Hide & Seek Milano

Magix Digestive MarieMonaco Parle MarieKreams Milk Shakti

Parle 20-20 Cookies Golden Arcs

Nimkin Kreams Gold Chox Monaco Jeera

Hide & Seek Bourbon    

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PARLE SWEETS

Right from candies to toffees, the sweet 'n' treat category of the Parle product range is a genuine treat for every snack lover. This category can satisfy one's taste and at the same time create a desire for more. These confectioneries are a sheer delight to the taste buds and have a universal appeal. Parle Biscuits and confectioneries, continue to spread happiness & joy among people of all ages.

Grab Your Sweets:    

Melody Kismi Gold

Mango Bite Orange Candy

Kaccha Mango Bite Xhale Poppins 2 in 1 EclairKismi Toffee GolgappaKisme Toffee Bar Melody Softee

Mazelo Parle Lites

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PARLE SNACKS-

Salty, crunchy, chatpata and crispy caters to the bunch of Parle snacks. You can now treat your loved ones with this yummy lot.Parle snacks are a complete delight to the taste buds and can create the desire for more and more. These snacks will not only satisfy your tummy but will also sustain a feel in your mouth to associate you with the bond of Parle.

Get Your Snacks:    Musst Bites Jeffs

Cheeslings Musst Stix & Musst Chips Sixer Sixer Zeera

Monaco Smart Chips    

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The product consistency generally depends on 3 parameters

2.7 PRODUCTION PROCESS-

The production process of every parle biscuit follows some basic

ingredients like wheat flour, vegetable oil, inverted syrups, skimmed milk

powder, etc. then depending upon the product, extra ingredients are

added for e.g. in Monaco there might be an extra amount of salt put in to

give it that prominent salt taste, to hide & seek, chocolate chips are

added. Etc.

THE MARKETING STRENGTH – DISTRIBUTION AND SUPPLY CHAIN

The extensive distribution network, built over the years, is a major

strength for Parle Products. Parle biscuits & sweets are available to

consumers, even in the most remote places and in the smallest of villages

with a population of just 500.

Parle has nearly 1,500 wholesalers, catering to 4,25,000 retail outlets

directly or indirectly. A two hundred strong dedicated field force services

these wholesalers & retailers. Additionally, there are 31 depots and C&F

agents supplying goods to the wide distribution network.

The Parle marketing philosophy emphasizes catering to the masses. They

constantly endeavor at designing products that provide nutrition & fun to

the common man. Most Parle offerings are in the low & mid-range price

segments. This is based on their understanding of the Indian consumer

psyche. The value-for-money positioning helps generate large sales

volumes for the products.

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However, Parle Products also manufactures a variety of premium

products for the up-market, urban consumers. And in this way, caters a

range of products to a variety of consumers

Parle uses the same distribution channels for selling all its products

under the biscuit category i.e. 1st, 2nd & the 3rd level of the distribution

channels.

CONSUMER END TO USE –

The basic end use of all parle products remains the same – eating it

simply to satisfy hunger. Products like parle-g may also be consumed for

the intake of high glucose levels for immediate strength & energy.

2.9 PARLE G

Every nation dreams of a better tomorrow. And every nation's tomorrow lies in the hands of its children; the young stars who shape the future of the nation. So, it's important to nourish these young stars, after all it's a question of the nation's future. 

Filled with the goodness of milk and wheat, Parle-G is a source of all round nourishment. Treat yourself to a pack of yummy Parle-G biscuits to experience what has nurtured and strengthened millions of people for over 70 years. A meal substitute for some and a tasty and healthy snack for many others. Consumed by some for the value it offers, and many others for its taste. Whatever the occasion, it has always been around as an instant source of nourishment. Little wonder that it's the largest selling biscuit brand in the world. 

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2.10 MARKETING MIX FOR PARLE G

Parle-G or Parle Glucose biscuits are one of the most popular confectionary biscuits in India. Parle-G is one of the oldest brand names in India and is the largest selling brand of biscuits in India. For decades, the product was instantly recognized by its iconic white and yellow wax paper wrapper with the depiction of a young girl covering the front. Many counterfeit companies have attempted to recreate and sell lower quality products of similar names and virtually identical package design.

Ingredients: Wheat Flour Sugar, Partially Hydrogenated Edible Vegetable Oils, Invert Syrup,

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Leavening Agents [ 503 ( Ii ), 500 ( Ii ) ], Salt, Milk Solids, Emulsifiers [ 322 or 471 & 481 ( i ) ] Dough Conditioners [223]. Contains Permitted Natural Color [Artificial]

Pack Size & Price:For 19grams:Rs.1/-

For 44grams:Rs.2/-

For 93.5grams:Rs.5/-

For 231.5grams:Rs.12/-

Place:It is available in mostly every retail shop.

Promotion:

It is relish a delectable experience as they melt in

your mouth. PARLE-G’s tag line is:

“Hindustan Ki Taakat”

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Product Life Cycle For Parle

Parle as a company has reached the maturity stage in its products life cycle; since

products such as parle-G, parle Monaco, parle Krackjack which form a major part of

parle products’ sales have captured most of India’s market.

But for its premium biscuits parle hide and seek and parle hide and seek Milano

the products are in the growth and introduction stages respectively.

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3. VALUE CHAIN ANALYSIS

3.1 INTRODUCTION

This concept was propagated by Michael Porter as a tool of analyzing the firm’s

internal environment and resource base. It is an analytical tool that describes all

activities that make up the economic performance and capabilities of the firm, used to

analyze and examine activities that create value for a given firm. A firm can be

conceived of an aggregation of discrete activities and the competitive edge arises

based on how a firm performs these activities better than its competitors. The cluster

of these activities is called the value chain.

The value chain classifies each firm’s activities into two broad categories: Primary

activities and Secondary activities or support activities. The following figure

represents the value chain of a firm:

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Primary activities: The sequence of activities through which raw materials are

transformed into benefits enjoyed by the customer is called primary activities.These

activities relate directly to the actual creation, development, manufacture,

distribution, sales and servicing of the product or the service to a customer. Five

major activities are involved in this sequence: inbound logistics, operations, outbound

logistics, marketing and sales and service. Working together, these activities

determine the key operational tasks surrounding the product or services.

Inbound logistics: As the word implies, inbound logistics deal with the handling of

raw materials and inventory received from the firm’s suppliers. Detail activities

include Receiving, storing, materials handling, warehousing, inventory control,

vehicles scheduling and returns to suppliers.

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Operations: Operations are the activities and procedures that transform raw

materials, components and other inputs into finished end products. Detail activities

include machining, packaging, assembly, equipment maintenance, testing, printing,

facility operations.

Outbound logistics: Outbound logistics refers to the transfer of finished product to

the distribution channel members. The focus of outbound logistics is on managing

the flow and distribution of products to the firm’s immediate customers such as

wholesalers and retailers. Activities and procedures associated with outbound

logistics include inventory control, warehousing, order processing, delivery

schedule maintenance etc.

Marketing and sales: Marketing and sales include advertising, promotion, product

mix pricing, specifying distribution channel members, maintaining channel relations

etc in order to induce and facilitate buyers to purchase the product.

Service: Customer service is a central value adding activity that a firm can seek to

improve over time. It includes installation, repair, training, parts supply and product

adjustment in order to maintain or enhance the value of the product after sales.

Secondary or support activities:

The remaining activities of the value chain are undertaken to support primary

activities. They are therefore referred to as the secondary or support activities.

Support activities help the firm improve co-ordinations across and achieve efficiency

within the firm’s primary value adding activities. Support activities are located across

the first four rows of the diagram. This includes, procurement, technology

development, human resource management and firm level infrastructure.

Procurement: Securing inputs (such as raw materials, supplies, and other

consumable items and assets) for primary activities.

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Technology development: Methods of performing primary activities are improved

(Such as know-how, procedures, technological inputs needed)

Human resource management: Employees who will carry out the primary

activities are recruited, trained, motivated and supervised.

Firm infrastructure: Activities such as accounting, finance, legal affairs, and

regulatory compliance are carried out to provide ancillary support for primary

activities.

How value chain analysis matters in strategic planning:

As already stated, the competitive edge arises based on how better the firm performs

the activities involved in the value chain compared to its competitor. For this

purpose, each activity is broken up in sun activities for comparison with the

competitors, and three basic questions are tried to be answered?

i) How can the firm keep the benefits provided to the customers intact keeping the

cost constant?

ii) How can the firm increase the benefits provided to the customers keeping the cost

constant?

iii) How can the firm increase the benefits provided to the customer while lowering

the cost?

For creating competitive advantage through the value chain analysis while

answering these questions, Porter has suggested the following measures;

Reconfigure the value chain differently from those of the competitors.

Perform the activities more efficiently than the competitors.

Outsource the non-core activities:

While outsourcing the following points are needed to be judged judiciously;

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i) There might be a risk of non-performance by the supplier, To avoid this, ways of

keeping alternative suppliers, Tapered integration and part outsourcing can be

adopted.

ii) There might be a risk of disproportionate value appropriation

iii) There can be a high risk of elimination by suppliers.

Internal integration of value chain activities:

Internal integration of value chain activity gives the following benefits;

i) Improvement of quality

ii) Shorten new product development cycle.

iii) By integrating the firm with its external suppliers and buyers it can reduce

inventory holding costs, enhance the ability to customize the product and become

more responsive to customers’ demand.

The point to be noted that throughout the whole analysis every measures are to be

taken on the basis of comparison with suppliers.

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