SUMMER TRAINING REPORTON

STEPS TAKEN BY CARGILL INDIA PVT.LTD. TO INCREASE ITS MARKET SHARE

IN DELHI & NCR

CARGILL INDIA PVT. LTD.

Under The Guidance Of MR. KUNDAN MISHRA (ASM)

SUBMITTED BY

RANA RANJEET SINGH

Course: MBA 3rd Semester

Enrolment No.09SBSMBA152

Roll No: 090251090

Date of Submission: 18-09-2010

Sharda University, Greater Noida

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ACKNOWLEDGEMENT

This project is a result of the efforts done by all the concerned and

cooperative personalities. This project could not have been accomplished

without the effort of my project guides Mr. Kundan Mishra The ASM.

I would like to thanks all the people that were surveyed, which were kind

enough to devote their precious time towards this project and our summer

internship. Without their cooperation of the aforesaid the results could not

have been accomplished.

Most importantly I would like to take this opportunity to thank my institute

(Sharda University) for giving me this opportunity to undertake this project

and thus helping me in adding various aspects of Cargill the FMCG industry

in detail. I am also thankful to all the members of the Cargill India Pvt. Ltd

for their kind support in this project.

Rana Ranjeet Singh

MBA-3rd SemesterRoll No.090251090

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S No. Topics Page No.

i. Title 1

ii Acknowledgement 2

iii Company as a Giant 4

1. Company Profile

1.1 Cargill India1.2 Products1.3 Brands

1.4 Other Activities 1.5 Location

5-910-131415-2425

2. Introduction of Project

2.1 Detail description of project

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27-43

3. Actual work done by me in South Delhi 44

4. Findings 47

5. Achievements 49

6. SWOT Analysis 51

7. Conclusion 53

8. Bibliography 55

9. Annexure 56

INDEX

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Cargill

Cargill is an international producer and marketer of food, agricultural, financial and industrial products and services. Founded in 1865, our privately held company employs 131,000 people in 66 countries.

We help customers succeed through collaboration and innovation, and are committed to sharing our global knowledge and experience to help meet economic, environmental and social challenges.

With the Financial highlights of:

In fiscal year 2010, Cargill had $107.9 billion in sales and other revenues. Net earnings were $2.6 billion. 

US Dollars in millions

2010 2009 Percent change

Sales and other revenues

$107,882 $115,059 -6

Net earnings $2,603 $3,334 -22Cash flow from operations

$4,630 $6,679 -31

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Cargill in India

Cargill maintains a number of businesses in India, with operations including the handling and processing of a wide range of products, including refined oils, grain and oilseeds, sugar, cotton and animal feed. In addition, Cargill develops flavour systems and operates a value investing business. Our presence in India has been growing since we began a joint venture operation in 1987.

Cargill is one of the biggest food companies in the world having more than 130 years of expertise in food grain selection and processing. It is the world's biggest producer, processor, and refiner of sunflower oil. Cargill has made quantum leaps in the small period of two years in the Indian food market.

Having entered into the Indian market recently, Nature Fresh today is the second-largest multinational atta brand in India and has a steadily growing market share in all the regions. The brand has also attained a double-digit market share in the branded refined edible oils category, and has made good inroads in the basmati rice and salt categories as well.

Headquartered in Minneapolis, Cargill Foods is a $45-billion company ranked 45th in sales in the Fortune magazine's Global 500 and fifth among the companies in the prepared foods category in the magazine's ranking of the top 250 global food companies in 1999.

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Cargill honoured with prestigious food science award

Cobham, UK — 17 August 2010 — Cargill is delighted to have been recognised by the International Union of Food Science and Technology and to have been named a recipient of the 2010 prestigious President's Award.The President's Award is a new category at the IUFOST Global Food Industry Awards that recognizes efforts to advance food science and technology for the benefit of all.

"We recognize the application of modern science and technology to sustain and develop traditional foods, to bring them to a wider number of consumers, while maintaining the character and benefits of the original traditional food product," stated Geoffrey Campbell-Platt, IUFOST President. "Cargill has been recognised for its food safety leadership, its collaboration and commitment to improving access to food and to ensuring food safety through education."

The President's Awards recognize and honour the support given to young scientists and students in allowing them to travel, to exchange ideas and to gain knowledge through meeting and interacting with leading international scientists and technologists. The President's Awards also recognize those that support international conferences on food safety in order to facilitate sharing best practice and improving food safety worldwide.

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"We are extremely proud that our commitment to achieving transparent, harmonised and science-based global food systems has been recognised by the IUFOST," stated Luis Fernandez, head of Cargill's food technology applications in Europe, Middle East and Africa. "As a global leader in food and agriculture, we are working alongside governments, industry and NGOs in order to promote food security — enabling all people, at all times to have access to a sufficient amount of safe, nutritious and affordable food.

We have also led the development and regulatory approval of safe, new ingredients such as Truvia, rebiana and Barliv to meet our customers' innovation requirements for healthy foods."

The award will be presented to Cargill at the IUFOST Global Food Industry Awards ceremony on 23 August in Cape Town, South Africa.

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Cargill milestones in India

1987 : Cargill Seeds - a joint venture operation - commenced in India.

1994: Cargill starts its fertilizer/crop nutrients operations in India.

1997: Cargill launches its primary sugar and edible oils trading business in India.

1998: Commences grain and oil seeds business in India.

2001:Launches food business under Cargill Foods – launch of brand “Nature Fresh”.

2003: Cargill acquires the Food Flavors business from Duckworth Group UK, and Duckworth Flavors India becomes part of Cargill India.

Cargill sets up green field edible oil refineries at Kandla and Paradip.

Cargill launches one stop agri-shops – Saathi Krishi Samadhaan Kendras.

2004: Cargill diversifies its fertilizer business into a joint venture with IMC global. Cargill India's DAP business renamed as Mosaic India.

2005: Cargill acquires Parakh Foods with brand "Gemini" and sets up a new Business Unit called Cargill Refined Oils India. This is first business unit with headquarters in India.

Cargill launches Saanjhi Unnati Program in Rajasthan for development of malt barley in active collaboration with the Government of Rajasthan and SAB Miller.

2006: Cargill starts its sugar off shoring business to support the execution activities of Cargill Netherlands.

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Cargill sets up CarVal India Pvt. Ltd.

Cargill enters into a joint venture in a project for setting up a green field sugar refinery in South India.

Cargill entered into tolling arrangements with local Soybean crushers in Maharashtra, Rajasthan and Madhya Pradesh

Cargill enters into a joint venture and subsequently owns and leads a shrimp feed manufacturing business in Rajahmundry in Andhra Pradesh. 

2007:  Cargill launches cotton trading business in India.

2008: An independently managed subsidiary of Cargill, Black River Advisor India Pvt. Ltd., begins operations in India.

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Customers we serve

Agriculture

We originate process and distribute grain, oilseeds and other commodities to makers of food and animal nutrition products. We also provide crop and livestock producers with farm services and products.

Food

We collaborate with food manufacturers, food service companies and retailers to provide high-quality food and beverage ingredients, meat and poultry products, and health promoting ingredients and ingredient systems.

Financial

We provide our agricultural, food, financial and energy customers with risk management and financial solutions in world markets.

Industrial

Cargill serves industrial users of salt, starch and steel products. We also develop and market sustainable products made from agricultural feedstocks.

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Products & Services

Animal Nutrition

Cargill Animal Nutrition develops and markets a broad range of animal feeds and customised animal productivity solutions to commercial producers throughout the world.

Coal

We carry out agency business or support business of our associates. Cargill Coal is one of our fastest growing businesses. We are active across physical and financial markets in both coal and freight—and recognized as a market leader in risk management and logistics.

Cotton

Cargill Cotton merchandises cotton worldwide. Cargill Cotton services growers, ginners, buyers and textile mills worldwide through our network of buying, selling and shipping offices.

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Ferrous

we carry out agency business or support business of our associates. Cargill India is amongst the largest ferrous exporters in the country, covering the whole of Asia, Middle East, Europe and North and South America.

Flavor Systems

we bring a customised and consumer-tested approach to creating advanced flavors and flavor systems for beverage, dairy, ice cream, confectionery, bakery, food service, and pharmaceutical markets.

Grain & Oilseeds

Cargill’s Grain & Oilseed business in India sources, trades, processes and distributes grain and oilseeds. The main bulk products handled are wheat, corn, oilseeds, barley and sorghum, as well as vegetable oils and meals.

Ocean Transportation

we carry out agency business or support business of our associates. Cargill Ocean Transportation offers customers a number of ocean freight solutions across all dry market segments and tankers.

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Refined Oils

Cargill Refined Oils India imports, refines, sells and markets a wide range of vegetable oils and fats to wholesale trade, industrial and household consumers across India.

Sugar & Sugar Support Centre

Based in Gurgaon, Cargill sugar India is involved in the origination, transporting, storage and exporting of raw, plantation white sugar. 

Trade & Structured Finance

Cargill's structured finance team designs and structures a broad range of customised financing solutions in domestic and foreign currency in relation to various commodities.

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Other Businesses

Black River Asset Management

Black River Asset Management LLC, an independently managed subsidiary of Cargill, is a global asset management company with 11 offices in 10 countries and more than 20 years of worldwide investment experience.

CarVal Investors

CarVal India Pvt. Ltd. is the management and advisory company that explores potential investment opportunities in the country. In India, CarVal Investors is committed to building and maintaining long-term relationships with partners, advisors and servicers.

Mosaic

Mosaic (NYSE: MOS), in which Cargill is the major investor, mines, manufactures, markets and distributes fertilizer around the world. Mosaic Company is the largest producer of processed phosphate, with significant equity interests in growing markets in China and Brazil. Since 1994 we have had significant operations in India.

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Corporate Responsibility of Cargill

When William Wallace Cargill founded our company in 1865, he deliberately set out to ensure that we earned and maintained a reputation for integrity, which he saw as a key differentiator in those times.

Corporate responsibility is part of everything we do. It is a company-wide commitment to apply our global knowledge and experience to help meet complex economic, environmental and social challenges wherever we do business. It is a process of continually improving our standards, our actions and our processes. Corporate responsibility extends not only to our own operations but to our wider communities and is based on four commitments:

We will conduct our business with high levels of integrity, accountability and responsibility.

We will develop ways of reducing our environmental impact and help conserve natural resources.

We will treat people with dignity and respect.

We will invest in and engage with communities where we live and work.

We recognize our continued success depends on the growth and health of our communities and partners, as well as the vitality and conservation of our natural resources. We are working with a diverse group of global, national and local organizations to support responsible economic development, help protect the environment and improve communities.

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Refining capabilities

Our refineries are unique in technology and refining capabilities. They also adhere to stringent specifications for maintenance of product quality, oil stability and food safety. Our operations are unparalleled in India, with:  The best and latest refining technology, tested across various

refinery set-ups within the global Cargill network.

A team trained by international experts and on international platforms ― fully equipped to produce excellent products in the country.

High quality standards set with international and Indian requirements in mind.

Specifications ensuring superior quality and high stability.  We never pack or ship anything that fails to meet these specifications.

Hands-free treatment, with no direct human touch on the product itself. Our fully automated refining technology has led to a clean, hygienic environment and a better, safer product.

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These refinery assets together have a cumulative production capacity of about 1770750 MT on an annual basis.

Our Brands

You may know us from the range of refined sunflower, soy, palm, olein and ground nut oils, hydrogenated fats and bakery shortenings we market under our national brands, Nature Fresh®, Gemini™ and Purita™, as well as other region-specific brands.

 

 The most exotic olive oil from Spain

 

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Refined Oil

Cargill Foods India imports, refines, sells and markets a wide range of vegetable oils and fats to wholesale trade, industrial and household consumers across India. We own and operate three vegetable oil refineries located at Paradeep (Orisa),  Kandla (Gujarat) and Kurkumbh (Maharastra). Cargill Foods India has been operating within India since 2005 and employs more than 750 people.

Major Refining Capabilities

Our refineries are unique in technology and refining capabilities and adhere to stringent specifications for maintenance of product quality, oil stability and food safety. The qualities found within our operations are unparalleled in India:

Best and latest refining technology, which has been tested

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and improved across various refinery set-ups within the global Cargill network.

A team trained by international experts and on international platforms run these refining capabilities and is fully equipped to produce the best product in the country.

Standards of quality have been set keeping the international and Indian requirements in mind. These standards incorporate the best of both worlds and meet the highest levels of quality.

Specifications that not just ensure superior quality but also high stability without addition of preservative chemicals. No oil that does not meet these specifications is ever packed or shipped.

Hands free treatment with no direct human touch on the product itself due to fully automated refining technology. This has led to a very clean and hygienic environment and a better and safer product.

NatureFresh® Acti-Lite refined oil :

NatureFresh® Acti-Lite refined oils always ensured

that you stay light and active. Now its verified! With added DMPS (a permitted antioxidant as ingredient), lab results have shown that food cooked in NatureFresh® Acti-Lite refined oils, absorb less oil as compared to food cooked in ordinary oils. So now indulge in your favorite foods without guilt,

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knowing that you have the trusted quality of Cargill. NatureFresh® is available in refined soybean and refined sunflower oil.

Gemini™ refined cooking oil :

Gemini refined cooking oils retain the freshness of

the oil from the time it is packed to the time it reaches the consumer. This is possible by the unique Freshness Intact Technique- a unique packaging technology that preserves the benefits of the oil.

What’s more, Gemini now comes with the

nutritional fortification of Vitamins A, D and E. The benefits of vitamins ensure that your family stays healthy and fit. Available in refined soybean, sunflower, groundnut and cottonseed, filtered groundnut and mustard oils and vanaspati, Gemini is now the largest selling edible oil brand in Maharashtra*.

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* Based on The Nielsen Company Retail audit data MAT December 2007

NatureFresh™ Oliante olive oil :

Add a spoonful of romance in your life with NatureFresh™ Oliante, themost exotic olive oil from Spain.

Presenting another gem from the NatureFresh® stable – NatureFresh™ Oliante, the most exotic olive oil from the land of Antequera in Spain.

In an era where anything and everything is commercialized, the olives of Antequera continue to preserve their absolute communion with Mother Nature that has existed for centuries. NatureFresh™ Oliante comes from

the olive trees over 600 years old. The oil takes three years of patient processing and what you get is the healthiest and most exotic olive oil.

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“ The most exotic olive oil from Spain”

The handpicked olives that go into the making of NatureFresh™ Oliante remain almost unaffected by time, true to their age and barely touched by modern technology. Nurtured in such a land makes NatureFresh™ Oliante truly exotic.

Home delivery available

We are pleased to launch home delivery service for NatureFresh™ Oliante for our discerning customers in Delhi/NCR as a first in the category. 

SMS NFO to 56677 to get your bottle delivered directly from Spain to your doorstep.Look forward to enjoying the surprise of live cooking counters at large retail format outlets and at your Resident Welfare Associations where our Oliante ambassadors will delight you with exotic dishes made with Oliante and share interesting information about the goodness of olive oil. To know more about the goodness and amazing flavor of NatureFresh™ Oliante, keep watching this space!

 

Three kinds of NatureFresh™ Oliante to choose from Each bottle of NatureFresh™ Oliante, be it Extra Virgin Olive Oil, Pure Olive Oil or Pomace Olive Oil, brings the magic of olive alive.

Extra Virgin Olive Oil is the highest quality of olive oil. To bring out the delicate flavour in the first press, a panel of Cargill experts judges the olive for taste, mouth feel and aroma to bring you NatureFresh™ Oliante Extra Virgin Olive Oil. As the healthiest cooking medium, Extra Virgin Olive Oil is preferred for salads, or

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is served at the table with bread for dipping. It is also added to soups and stews.

Pure Olive Oil comes from the refining process of olive oil named "lampante" and by adding a percentage of extra-virgin olive oil. Pure Olive oil is used for all kinds of high heat cooking such as pasta, lasagna, stir fried vegetables and an array of Indian dishes like aloo gobhi, chicken curry or even a chicken biryani.

Pomace Olive Oil is a blend of Extra Virgin Olive Oil and refined Pomace oil. Pomace Olive Oil is a very good baking and frying medium. It is popularly used to make French fries, crispy fried chicken, baked potatoes and more.

NatureFresh® Purita Kachi Ghani pure mustard oil :

NatureFresh® Purita is renowned for its purity and

taste. With a pungency level of 0.27%, which is higher than the highest AGMARK standard of 0.25%, NatureFresh® Purita is the best oil for cooking your favorite fried dishes. NatureFresh® Purita ensures that your family is full of vigor and health.

 

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PRODUCTS

Animal Nutrition

Cargill Animal Nutrition develops and markets a broad range of animal feeds and customized animal productivity solutions to commercial producers in 28 countries across North and South America, Europe and Asia. 180 plants worldwide support the business unit. Animal Nutrition in India serves feed products in these categories: dairy, beef, swine, poultry and aquaculture.

Cargill Animal Nutrition in India

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Cargill Animal Nutrition started in India through

a joint venture with a local shrimp feed company located in Rajahmundry, Andhra Pradesh in February 2006. This was followed by the successful opening of a dairy feed business in Rajpura, Punjab in October of the same year. By March 2007, the Rajahmundry business became a wholly owned subsidiary of Cargill India.

Cargill Animal Nutrition - Rajahmundry is a specialized manufacturing facility for aquaculture feeds. With the presence of the local brands pre-acquisition, a faster go-to-market strategy was deployed, helping to create awareness in the Cargill brand and its feed technology with the shrimp farmers of South India including the states of Andhra Pradesh, Orissa, West Bengal and Tamil Nadu. Through a series of well-executed road shows, uptake of the products was rapid.

Today, the facility is focusing on its next feed offering in the south with Aqua Focus™, a line of fish feeds targeted for the domestic production of Indian carps such as Rohu, Catla and Mrigal. Five month trials of the product is proving to be a hit with local farmers as feed conversion rates (FCR) of 1:5kg of traditional feed has dramatically been reduced to below 2kg.

Cargill Animal Nutrition - Rajpura started operations by offering dairy feed. After several in-depth studies of the local dairy cattle scene conducted by Cargill Animal Nutrition's dairy technology deployment managers from Italy, Korea and the US, the feed was launched with much enthusiasm in Ludhiana, Punjab. The success in this segment was brought about by the

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observation by farmers of higher milk output only two weeks from converting their local feed to Cargill Animal Nutrition.

Another breakthrough was the introduction of the Purina® line of poultry feeds. Also very notable was the quick acceptance of the product by broiler farmers in Haryana and Punjab, earning Rajpura the credit of being one of the fastest growing broiler feed markets within Cargill Animal Nutrition.

Animal nutrition technology

By measuring customer success, understanding the environment and knowing where customers wants to be, Cargill Animal Nutrition has created an array of solutions . Through technology we have been able to set new standards of animal nutrition quality and delivery of proprietary nutritional capabilities through:

Optimum Value Supplier Database™: An innovative information system that enables us to choose ingredient suppliers based upon the nutritional value they deliver for each formulation.

AutoCalc® : Our proprietary AutoCalc® system manages the changing nutrient content and availability from ingredients.

Energy, phosphorus and amino acid systems: Our AutoCalc® system contains proprietary tools that help determine the available levels of energy and key nutrients contained in our ingredients, taking into account processing methods and species-specific utilization.

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  Cotton

We launched our independent and dedicated cotton trading business in December 2007. We plan to strengthen our business with our long time suppliers and build new market channels to source and supply India cotton. As Cargill Cotton, we are one of the world’s largest and oldest cotton businesses and very proud of our long relationship with India cotton.

 We are proud to be on the ground in India where cotton trade started. We have a network of value chain participants who help us source and supply the best cotton into and out of the country. From making Indian Shankar 6, Bunny and MECH preferred choices by mills around the world; to sourcing Extra Long Staple (ELS) and African cotton for Indian mills we have a range of customer solutions.

As the world moves forward in liberalizing trade, and India emerges as a dominant cotton country, Cargill Cotton believes we must make a long-term commitment to the Indian market. We think our experience in total supply chain support can help India become a world-class supplier. Our innovations in finance, logistics, risk management and quality control can improve profitability for both our cotton suppliers and our textile mill customers.

Cargill Cotton has had roots in India since 1851, when the Ralli Brothers was incorporated with offices in Calcutta and Bombay. Cargill Cotton came into existence combining the strengths of the two organizations - Hohenberg (in North, Central and South America) and Ralli (in Africa and the Indian sub-continent). Cargill became recognized as one of the most mature, respected, and experienced cotton merchants in the world of cotton. In 2002, after over 20 years of operating under both the Hohenberg and Ralli

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names, the name of the entire cotton operation was changed to Cargill Cotton.

 

We are very proud of the success and growth that we have shared with our suppliers and buyers over the last 150 years. We are equally pleased to be able to look back at our history and see that the company's tradition has always been one of absolute integrity. In today's diverse and multi-cultural world we know that our unparalleled reputation is our most valuable asset.

 

Ferrous

Cargill participates actively in the import, export and distribution of ferrous products and raw materials, covering Asia, the Middle East, Europe, North and South America. We export from a broad spectrum of Indian mills and mines—buying the full range of products from more than 40 customers from iron ore to finished steel. Imports cover finished steel as well as semi-finished steel for meeting the requirements of users.

We provide our customers with a wide range of value-added services including port plots and local distribution, logistics and transportation capabilities, pre-financing, long-term agreements and other logistics and risk management tools.

  Flavor system

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We bring a customized and consumer-tested approach to creating advanced flavors and flavor systems for beverage, dairy, ice cream, confectionery, bakery, food service, and pharmaceutical markets. Our India Flavor Systems business has been operating since 1991. Our business specializes in liquid flavor, emulsions, spray dried flavors and dry mix powders.

Our flavor systems are designed for a broad range of food and related products: bakery and biscuits, beverages, confectionery, dairy and liquor.

 Grain & Oilseeds

Our Grain & Oilseed business offers unique solutions around risk management, supply chain, logistics and inventory management to its customers in food in India. We are amongst the largest suppliers of domestic and import food grains to the private sector and government of India. For example, we provide identity preserved food grains to major food companies and flour millers in the country.

We trade and process of a variety of oil seeds like soybean and rapeseed and are one of the largest merchant exporters of oil meal out of the country.

The business connects the Indian farmer with markets through a network of Saathi centers that provide farmers with competitive prices and access to reliable grain buyers. 

Headquartered in Gurgaon, Grain & Oilseeds has operations in more than 10 states where we manage several facilities that serve markets and customers in those regions:

More than 50 grain and oilseed origination and storage locations

Multiple soybean processing facilities spread across the country

Four regional merchandising offices

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12 origination offices 

  Ocean Transportation

Cargill Ocean Transportation has developed over its 50-year history a deep expertise in chartering, trading, logistics, operations, and risk management.

We offer our customers a number of ocean freight solutions across all dry market segments and tankers. Our focus is on safety, high quality, and risk management. Our aim is to be recognized as the most innovative and customer-oriented partner in the market.

Our Strengths

Global coverage across all major oceans

A range of vessels from cape size to coasters and tankers

A high quality fleet due to our rigorous vetting policy · Innovative physical and structured financial solutions

Global commodity expertise and insight

Complementary trade flows

Logistics supply chain expertise

Financial stability

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In today’s fast changing, demanding and stimulating shipping environment, we offer our customers diverse skills and our local and global shipping knowledge.

Sugar and Sugar Support Centre

Based in Gurgaon, Cargill sugar India is involved in the origination, transporting, storage and exporting of raw sugar. Our team has built up a base of several key suppliers and customers spread across the key producing states of Uttar Pradesh, Maharashtra, Tamil Nadu, Karnataka and Andhra Pradesh. In addition, we have strong relationships with customers in Srilanka, Pakistan and Bangladesh.

Cargill started its Sugar Support Centre as an experiment to support the execution and accounting activities of Cargill BV Netherlands in 2005. Today, the group is highly successful and a very integral part of the sugar business worldwide. Within this group sugar is procured from all originating and surplus countries like Brazil, Thailand, Central America, and Europe and sent to other destinations such as Mediterranean countries, West Africa, and the Far and Middle East.

 

Trade & Structured Finance

Cargill Trade & Structured Finance is a financial management arm of Cargill  that supports the group on their trade and structured financial solutions requirement.  The  group also extends these services to other small, medium and large corporates in India, sharing their expertise and providing customised solutions for their working capital and balance sheet requirements. The Cargill Trade & Structured Finance group is headquartered in Minneapolis with a team of financial experts across the globe in developed and developing economies.

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Cargill Trade & Structured Finance started India operations in 1996 and has successfully created a niche quite comparable to a boutique investment bank supporting their corporate clients in their working capital management and supporting their exponential growth in India and abroad. For better service deliverability and bringing in efficiency in the solutions, Cargill started its Non Banking Financial Company in 2007 under the name ofCargill Capital and Financial Services India Pvt Ltd (CCFSIPL).

Cargill's structured finance team designs and structures a broad range of customised financing solutions and arrangements both in local and foreign currency. The team supports in several credit enhanced solutions, not limited to the following:

Working capital restructuring

Cross border trade advisory services

Short-term and Long-term trade-related financing

 Promoter financing

Real estate financing

Securitization

Equipment finance

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Locations:

 

Paradeep (Orisa),  Kandla (Gujarat) and Kurkumbh (Maharastra)

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INTRODUCTION TO PROJECT

Cargill Foods India Pvt Ltd has recently launched a series of program in attempt to raise the market share of Nature Fresh oils. These below trade level programs (BTL) have given major emphasis to the wide & extensive availability & best visibility of their products. This whole series of program is termed as STAR RETAILER PROGRAM. This program aims to increase sales through retailer appraisal program. This is a kind of push strategy onto the consumer through retailer as retailer has great role in educating &influencing customers for various products. Therefore this is a big attempt to build a relation of trust & care with the retailers by promoting their interest & developing an environment of warmth & comfort.

A Star Retailer program is that group of programs which has been started with a basic motive of strengthening & deepens the relationship with the retailers. In this program only few retailers has been selected with great potentials. These are selected on the basis of certain pre-determined criteria. This whole combination of activities under Star Retailer program would include activities like

Appreciation letter personally signed by ASM to each of Star retail outlet

Three month display program at Star Retail outlet

Quantity purchase scheme (QPS)

A surprise gift for the retailer within the time span of three month

A surprise gift for the worker of the retailer

A gift to the retailer on their Birthday & Marriage Anniversary or shop anniversary

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Each activities of this program would be operational for minimum period of 3 months (20th July 2010 to 20th October 2010), but particularly QPS would be operational from 15th July 2010 to 15th October 2010.

To measure the success of this program, sales target has been fixed for each of the retail outlet which is to be achieved in the span of three months. A proper tracking system has also been adopted to track the sales of these Star outlets. This continuous monitoring system is proved to be a great help in determining the progress of program even on daily basis, ascertaining targets, continuous follow ups, etc.

The tools for tracking sales are

ISR/DSM Star Outlet tracker book

SO Star Outlet tracker book

QPS cards

Daily sales update of Star outlet in Management Information System(MIS)

Beat book

Apart from the retailers, Cargill Foods has also decided to even uplift the enthusiasm of our team with the help of various activities as part of these programs. In this combination of programs every member of team has got special tasks to be performed, involves responsibility & special recognition to innovation to motivate further. To benefit them even monetarily, an incentive system has also been designed.

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DETAIL DESCRIPTION OF PROJECT

With the aim of capturing larger share of potentially high market Cargill Foods India Pvt. Ltd has started whole group of activities at below trade level (BTL). In an attempt to raise the level of bonding with the retailer & to ensure smooth work environment, this is a big initiative taken by the company at the grass root level. In this program, a whole web of activities has been designed to give huge boost to the current sales level.

These programs have been structured to promote the interest of the retailers in a favorable way.

This time the company has decided to launch a series of programs for the retailer on the basis of a belief that whatever retailer’s purchases, he would be sell able to sell it & also retailer plays an important role in convincing customers at the point of purchase. Most of the times a retailer serve the role of advisor or counselor for various products. Customers generally have faith in retailers for products & its quality. That makes an obvious sense that retailer have great recommendation powers.

To mold their recommendations in our favor, to gain retailers trust & to develop or strengthen the business bonding Cargill came up with a BTL activity in which retailers have been given most of the preference.

This time a 3 month campaign has been launched called Star Retailer Program. It involves various activities to promote our brand through retailers. It is a good attempt to raise Brand Equity of Nature Fresh through the medium of retailers.

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STAR RETAILER PROGRAM

OBJECTIVE

• To increase the sales Volume in High Potential Outlets by 1.6 times (Current 590MT to 920 MT per month) over 3 month period (from 20th July to 20th October) in 2000 outlets in Delhi NCR & Select Cities of North

• To gain Mind share of the retailer & hence the handling share

• To build mutual trust to further grow the market share

This is a 3 months program in which various activities are divided throughout the duration of the program. For most effective results only few outlet has been identified as focus outlets all across the region of Delhi-NCR & some cities of North India onto which this program is applicable. A new concept of 80:20 ratios has evolved from a deep study of past sales record.

This study states that top 20% of outlets are accountable for 80% share in total sales. This study helped in fixing & aiming this program to a specific group in order to ensure the most effective implementation of program & most efficient utilization of funds. This concept of 80:20 made a good sense to approach these outlets with the series of programs & benefits. By aiming this 20% of outlets brand can easily achieve set objective of raising volumes & hence market share.

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The basic criteria for selecting an outlet is its capacity, profile of Outlet & our existing Share. A minimum benchmark has been set for these outlets to be focus outlet, this criteria is that outlet must be selling minimum of 1000 liters of branded oil in a month in consumer packs only & in which our share is about 15% or lesser than that. We included those retailersalso whose current sales are high of our product in order to avoid the feeling of being left out in benefiting program by the company.

Now to aim at two of the major objectives of raising volumes by gaining retailers confidencevarious activities have been designed. These activities are

Appreciation letter

This is the first step in which an appreciation letter is given to the retailer by the sales person. In this letter we have thanked & appreciated the retailers for their efforts & support in making our product a big success. After this vote of thanks we have then informed the retailer about the series of programs that we are going to start for next three months. All these letters are personally signed by Area Sales Manager (ASM) to give a personal touch of warmth & care to them.

Display program

Under this program we have given the retailer a three month display program. This is to ensure visibility of our product in the store at the point of sales. We have offered the retailer a sum which varies from Rs 300 to 650 per month payable at the end of three months. Certain standard have been fixed for this display program, that is minimum of two 5 liter jar should be placed in a window along with minimum five 1 liter pouch should be hanged. This window should be at eye level at highly noticeable place in the shop. Any other display activity at anywhere in the shop apart from this minimum requirement is

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allowed. To make this display most effective & ice breaking greater emphasize has been given to unique yet simple display. New & fresh ideas are highly appreciated for this purpose. To fight tough competition Soya bean oil has been given due importance under this program.

A different prize program has also been started in which different prizes are be given to our team members for best & unique display.

To check the proper implementation of the program, a system of planned or unplanned cross functional visit has also been introduced.

Quantity purchase scheme(QPS)

To get benefitted from our various supporting activities & to boost sales to a next level, a Quantity Purchase Scheme (QPS) has also been launched. This scheme is commonly known as 8 SE 21 as it has benefits of Rs8 to Rs 21 per case of oil. This QPS is the only scheme which is not kept restricted only for focus outlets. This is open for all outlets across cities who can achieve the target. This is valid for three months starting from 15 July till 15 Oct. This scheme is also on various range of Gemini.

This QPS is valid on number of cases purchased. It includes all kinds of oil(Soya bean oil, mustard oil, sunflower oil, Vanaspati)& in all sizes. This scheme starts with minimum of 60 cases & goes up to 2200 cases in span of 3 months. This scheme has also given choices in the gifts at all level of targets (i.e. either option 1 or option 2). This scheme has included gifts of various brands of high repute. This starts from Milton 4 container lunch box, Philips Steam Iron & goes till LG LCD TV, all-expense paid trip to MT Abu or KulluManali.This scheme is not valid on Palmolien or Olien& on Institutional pack.

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Surprise gift to the retailer

A gift program is also being designed as a part of this Star Retailer program. Under this program various gift would be given to the retailers with in the duration of this program. This would be a surprise gift to them. It is done to emotionally attract the retailer & to strengthen the relation we share. This would give them a feel of care. These gift would be in form of scratch card varies from Rs 5 to 5000 & a couple movie tickets of PVR.

Surprise gift for the staff of the retailer

In this whole web of programs, company has also decided to distribute some surprise gift to even the staff of the retailers (that is Shop boys). This is the first time ever that a company has attempted even to benefit the shop boys. Every shop which we are targeting as focus outlet are big in nature that they need certain number of shop boys to handle& manage, it may vary from 1,2,3 or even more than that. Out of these shop boys 1 would be senior, superior & more loyal to the retailer. We are actually targeting that supervisor shop boy among all at each shop in this program. The main motives of benefiting these Shop boys are

These shop boys are key touch point for consumer interaction. They are one of main source of consumereducation, generally they interact most withthe customer at the time of purchase. They can easily push a product on to the customer.

They are majorly responsible for stock management & inventory control. It is up to them to decide the placement of various stocks.

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Their support could prove to be very helpful in enhancing our various programs throughout the duration of 3 months. They could even convince customers, maintain our display window, ensure visibility of our product,etc. if properly motivated.

In most of the shops, these staff boys become dear to the retailers. This whole blanket of benefits for retailers & shop boys motivates both retailers as well as shop boys towards the brand.

To ensure personal touch under this benefit, ISR/DSM are also advised to remember the name of the shop boy at all stores.

Surprise gift on Birthdays, marriage anniversary, shop anniversary.

As a part of Star retailer program, a surprise gift has also been decided on the birthdays, marriage anniversary or shop anniversary. This gift on various anniversaries would surprise them with a feeling of extra care by the company. This special feeling of celebrating their occasion with all the joy gives them an extra edge of warmth which enhances our bond too. A bouquet has been decided as the gift on the occasion & for hassle free delivery an agency has also been hired too.

To ensure proper implementation of the program & to encash our various efforts in form of sales, our team has been given individual targets of each of focus outlet. From all these efforts an average of 60% hike is expected in sales from these high potential outlets. Every team member has been advised that must ensure the fulfillment of targets at level.

TRACKING SYSTEM41

To evaluate the effectiveness of the program, a completely foolproof system has been developed to check the progress of the program at any point of time. This system been developed such that results from one source rechecks the result from other source. It is updated & maintained on regular basis in order to have continuous assessment of the progress. This tracking system would consist of

ISR/DSM have been given a separate tracking book which should be filled on daily basis. This book would maintain a separate page of each retailer focused under this program.

SO would also maintain a tracking book by compiling the data from his team. This book would only have sales summary of each outlet instead detail sales record.

Another system has also been adopted to update sales on daily basis that is through daily sms. Every member of the team will also give daily sales volume of the focused outlet held in the beat of the day. This data would be given to their respective SO through sms& SO would compile all the data & will update it to companies MIS on daily basis.

To keep a count on the number of cases purchased by outlet for the distribution of gift under Quantity Purchase Scheme(QPS), a separate QPS card is maintained at the retailer point for future reference.

For complete sales record a beat is always maintained for all outlets. This would also serve as good source for quick future reference.

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INCENTIVES

To keep the whole team highly motivated even under high work pressure, an incentive scheme has been developed to benefits them monetarily. This is very helpful in keeping the moral of the employees high. The structure of the scheme is

Qualifier:

Minimum 75 % of the outlets should achieve the target.

Audit of 30% Outlets every month by a selected team.

Evaluation Criteria(No of Marks)

% Achievement

90% 100% >110%

Achievement of Target63 70 77

Display as per Agreement     

Location of Display 5 5 5

Dimension of Display5 5 5

Display Hygiene      

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Min 2 jars & 5 Pouches5 5 5

Use of POS 5 5 5

Innovative/Creativity 10 10 10

Total marks 93 100 107

No Of Marks Incentive Amount

85 Rs. 1000

100 Rs. 1500

Above 100 Rs. 2500

Actual Task Done by me In South Delhi Before proceeding to the task done by me in South Delhi I would like to give the complete detail of the area given to me to work on the project.

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South Delhi was the biggest zone in area wise as compared to rest of the four zone that is East, West, Central and North in Delhi & NCR .The team of South Delhi consisted of twelve members .There were one SO(sales officer),Three ISR(interim sales representative),Eight DSM(District sales manager).The total no. of star outlet in South Delhi were two seventy nine(279),largest in comparison of any other zone .All the team members were given sales target to achieve in their area. And then the total sales target of entire zone was to be achieved. The complete sales targets were very much equal to the three times of the present sale. I was free to use my all skills on the behalf of company representative to achieve target. We were also given the responsibility for the successful running of scheme like Three months display programme,8 to 21 QPS, Surprise gift, Gift for shops owner and their staffs. The task done by me are as follow:

i. I co-ordinated the team of eleven members with our sales officer.ii. I convinced many star outlet retailer to sign our display contract.

iii. I helped in convincing many retailer to increase the quantity of their order(sale) and enhance the sale of nature fresh oil.

iv. I with my all team members of South Delhi gave extra effort to put the display on all star outlets on the given time.

v. I personally met the retailer and noted their problem, and conveyed it to my seniors. Some problems which I could solve or conveyed it to my seniors like misunderstanding between retailer and distributor, retailer and ISR/DSM etc.

vi. Most of the time I tried to motivate my team to achieve the target on the given time frame. In the evening I use to ask my team member that how much you have sale and how was the response in the market.

vii. I collected the data related to the DOB/Marriage anniversary, Shop Address etc . of the retailer with the help of our ISR/DSM .So that delivery of gifts and other correspondence can be done properly.

viii. I tried to persuade my teammate to focus on achieving each day target so that monthly target can easily be achieve and then the bigger target.

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FINDINGS & OBSERVATION

The reports of each phase of the project had to be supplemented by the information, data, facts and figures and significant findings and observation to support the feasibility of the decisions to be taken on the basis of the retail mapping summary. The information so recorded in each phases of the project had to be listed in order of their relevance and seriousness and presented in a form to facilitate immediate inference.

Some of the important observations have been listed below:

Edible oil business behavior is governed by brand loyalty so the Availability of the right brand (which is regularly being used by The customer) is the key for winning consumer in edible oil business.

The retailer played a very critical role in the increment in the sales Volume of the product and they had to be kept satisfied in order to Increase the market share by offering better schemes, discounts, Display materials such as racks, counter, signage, wall paintings And better amount for purchase of shelf space for display (which We have done).

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The present distribution system of Nature fresh edible oil is satisfactory in oil industry in DELHI & NCR but we need to focus on few areas like:

1) Payment of money on time to the distributor so that they never stop the supply of product to the retailer.

2) Distributor should also get the goods on time from the super stockiest so that they can fulfill the demand of the retailer on time. their shouldn’t be casual approach from any level of the \ distribution channel.

3) We must have best transport service facility in comparison of entire FMCG industry in Delhi &NCR. Because this department always proved to be the major excuse for non availability of goods in the market.

4) Their must be separate department to administer the distributor system.

5) The major issue related to some of the Distributor & Retailer is that due to their personnel misunderstanding they are not ready to either supply/receive goods from each other.

The enhancement in the distribution system would definitely increase the market share.

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More often dealers also try not to move the schemes and other incentives information to the retailers, which is one of the reasons for the dissatisfaction of the retailers.

In few areas of Delhi & NCR Nature Fresh proved to be the best consumed edible oil whereas in entire Delhi & NCR region nature fresh edible oil is ranked no.2 in consumption in comparison of other edible oil. FORTUNE is no.1.So the most competitive brand for us in the market is FORTUNE. Reasons are as follows:

One of the important reasons one for this is proper and regular supply of FORTUNE brand items in the market.

They are all ready established but quality wise we are better.

Another critical issue may be the presence of duplicate products of Nature Fresh in the market. None of the case related to this has been reported yet but in market we came to know about the production of duplicate ghee,oil etc. we must be careful about it.

With growing quality consciousness and plummeting price differences between packaged and non-packaged edible oils, the packaged edible

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oil sector will capture 50% of the market share within three years. The packaged edible oil consumption is only about 20% of the total 12.5 million tonne domestic consumption. Cargil controls more than 12% of the packaged edible oil market. The packaged edible oil industry is growing at 10% annually and half of the market will be controlled by packaged oil manufactures within three years.(Feb2003report.)

we are working exactly in the same market scenario as it was believed few years ago on the basis of above data.

According to survey in FY2009,Cargill had $116.6 billion in sales and other revenue Indiabiznews, December 16, 2009).

India, the world's largest importer of oils, buys nearly 5m tonnes of

crude in the world market, which is then refined in India. Cargill, the US agribusiness group, is looking to build one of India's largest vegetable oils refinery in the coastal state of Orissa, the Financial Times reports this week. The proposed plant, with a daily refining capacity of 1,000 tonnes mainly for processing imported vegetable oils, will be located close to Orissa's all-season Paradeep Port. On the basis of proposed plan we can say that Cargill foods is going to lead in the future in oil selling.

ACHIEVEMENT  

“When you do nothing, you feel overwhelmed and powerless. But when you get involved, you feel the sense of hope and accomplishment that comes from knowing you are working to make things better.” we worked hard to accomplish the given project, whatever target were given to us we worked sincerely to achieve them.

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Those achievements are as follow

We were able to achieve our monthly sales target.

The relationship between distributor and retailer became stronger.

We were able to run our Star retailer scheme (8 to21 QPS,3 months display, surprise gift etc.) successfully.

We successfully started the sale of nature fresh oil in some outlet.

In last few months, we noticed huge price rise in oil products but then also the sale of nature fresh oil increased. It shows customer is giving preference to our product at the cost of price also.

Almost all the star outlet (pointed by Cargill foods India Ltd.) Expect few in Delhi &NCR has the window showing most attractive nature fresh display.

In market big distributor, retailer, customer are giving more weight age to nature fresh product because of its activeness in the market, i.e. presence of display, good distribution chain like presence of ISR,DSM in the market and regular visit of companies officials.

We developed the good relationship with our SO, ISR, DSM,DISTRIBUTOR RETAILER etc. The bond between

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Company and company’s employee are getting stronger day by day Because of the healthy work environment and the regular distribution of gift on performance basis.

The gap in the sales ratio between fortune and nature fresh oil is decreasing day by day. Quality wise our product is being preferred more.

We learn the technique of selling and convincing the people. we Developed the leadership skill, we groomed our personality. We got the opportunity to experiment our leadership skill to get best out of our employee.

Response and there is general perception in the market that sooner or later only Nature fresh can lead the Fortune.

SWOT Analysis of Cargill Foods

Strengths:

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The quality of our various products is the biggest strength of the company. In terms of quality, every product has maintained its standard quality through which it excels in the market.

Dedicated hard working& highly efficient team is the backbone to the company.

Deeply rooted supply chain. We got effective supply chain to reach even small markets & to target even niches.

Weakness:

Our whole range of products is not available across various stores

Late execution of promises made under various schemes & benefiting programs

Less awareness of our product quality & our unique selling point (USP) of 5 liter fat free in a year concept among masses.

Opportunity:

Rising oil consumption of people as per gram consumption per person rises from 27 to 38 in developing countries like India.

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Majority of our huge population is consuming low quality oil.

As resultant of rising disposable income people are becoming more health & quality conscious

Threats:

Low priced or local oils are focusing small regional areas or niches

Competitors are coming up with different categories of oil to capture wider segment of market.

CONCLUSIONS

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The edible oil industry is significantly based on the satisfaction of consumer regular taste. These are the products which customer does not change in very short span of time. People generally using this product rarely experiment on other brand. If some family is using nature fresh for a long time they will rarely try for other oil until and unless there is regular complain or some reasonable problem. These are the products which people generally don’t keep on changing because it becomes the taste of the family.

So two things regarding oil should be kept in to the mind that:

a) It takes time to reach up to the tongue of the customer.

b) Once reached it takes twice, thrice or more time to change the brand. Quality wise Nature fresh are very good in the market so we have to focus on Second stage that is making people aware of our products through Advertisements, promotional activity.

Its very necessary to popularise the nature fresh products efficiently and present them in such a manner so that it can motivate the consumer and generate the thirst in consumer to consummate it.

Presently whichever area we are going , we are getting good response . So we must work hard on creating new market. Edible Oil businesses are not governed by brand loyalty so we should also focus on retaining the market as well as customer.

There is a line quoted in history by Alexander the great “veni, vidi, vici” which means “I came, I saw, I conquered”.  Nature Fresh product is

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capable of proving this line. We need to focus on new area. The day our product reaches to new market we are bound to get good response because we already have good supply chain, good distribution system. Nature fresh need to get just a small space in the market and then it will start spreading itself because of its product and well established marketing system.

Our product is not very much popular among few section of the population like rickshaw puller, taxi driver, labour, worker living in Delhi &NCR because of not having the different ranges of the prices .we should also focus on this section of the society so that they can also purchase the nature fresh oil in comfortable range and can classify themselves in the category of using branded product. They consist large no. of population.

So here we conclude keeping in mind that whatever view we have expressed will help the organization in its growth.

BIBLIOGRAPHY

1. www.naturefresh oil.com2. www.cargill foods India Ltd.com

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Books:Marketing Management

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