To set the Route to Market & Selling methodology for Nestea Iced Tea

By

Ankur VermaInstitute of Management Technology, Ghaziabad

June, 2010

To set the route to market and selling methodology for Nestea Iced Tea

By

Ankur VermaInstitute of Management Technology, Ghaziabad

Under the guidance of

Mr. Sanjay Singh Prof. Dr.Nina JacobsArea Sales Manager Assistant Professor Nestle India IMT, Ghaziabad

June , 2010

Certificate of Approval

The following Summer Project Report titled "To set the route to market and selling methodology for Nestea Iced Tea" is hereby approved as a certified study in management carried out and presented in a manner satisfactory to warrant its acceptance as a prerequisite for the award of Post-Graduate Diploma in Management for which it has been submitted. It is understood that by this approval the undersigned do not necessarily endorse or approve any statement made, opinion expressed or conclusion drawn therein but approve the Summer Project Report only for the purpose it is submitted.

Summer Project Report Examination Committee for evaluation of Summer Project Report

Name Signature

1. Faculty Examiner _____________________ ___________________

2. PG Summer Project Co-coordinator _____________________ ___________________

Certificate from Summer Project Guides

This is to certify that Mr. Ankur Verma, students of the Post-Graduate Diploma in Business Management, have worked under our guidance and supervision. This Summer Project Report has the requisite standard and to the best of our knowledge no part of it has been reproduced from any other summer project, monograph, report or book.

Mr. Sanjay SinghArea Sales ManagerNestle India Ltd.M-5A,Connaught Circus,

New Delhi – 110001

Date : 18 / 06 / 2010

Abstract

To set the route to market and selling methodology for Nestea Iced Tea

By

Ankur Verma

This project deals to Study the market and selling methodology of Nestea Iced Tea and compare viz-a-viz its competitors and suggest ways for improving sales, distribution and merchandising. There are many players in the refreshing drinks industry and the competition is increasing and it is getting extremely difficult for the players to retain their market share. It has become essential for all the companies to come up with marketing strategies for customers, influencers and channel partners.

A market research was done to know about the customer/retailer perception about Nestea Iced Tea and its competitors (Tang and Rasna).All the data was analyzed to know about the factors which customers and retailers consider while making their buying decision .The research focused on refreshing drinks which are available in the condensed powder form. The data has been collected from customers and retailers of west Delhi region.

The major findings are:

1. Usage of Nestea was lowest in comparison to its competitors Tang and Rasna. Tang was more preferred in posh markets whereas Rasna was preferred drink in the lower end markets.

2. Most people were aware of its Herbal variant but still lemon was the most preferred flavor.

3. Television was found the most convenient medium through which people got aware about Nestea.

4. Quality and Brand were two important factors on which customers based their buying decision in refreshing drinks industry and Nestle had high brand value among its customers.

5. The consumer promotion most desired by the customers were free gifts,1+1 free and 25% extra

.

6. Many retailers confirmed that sachets and smaller packs sell more as compared to half kg packs

especially in the lower end markets.

7. According to retailer’s quality, product visibility and customer satisfaction are important reasons affecting sales.

8. According to retailers schemes offered by the company is an important factor that affect the retailing of the products in this category.

9. Display money given to Nestea retailers was at par with other competitors but margin given to retailers was less as compared to others in the industry.

The research methodology used consisted of three phases:

i) A primary data collection by getting the questionnaires filled from customers and retailersii) Study of secondary data sources, and

iii) Quantitative analysis of the collected data and qualitative analysis of the information.

Other data sources were in-depth interviews of some 150 retailers present in west Delhi region for a total period of about 4 weeks.

Acknowledgement

This project report has been a very special project, brought to fruition through the efforts of some very special people. I am deeply grateful to the entire management of “Institute of Management Technology Ghaziabad” for giving me an opportunity to dirty my hands on the practical aspect of life. It would have been quite impossible without the immense help and conducive environment proffered at Nestle India, wherein they bared me as an intern for two months.

I express special thanks :

I would like to express my deep sense of gratitude to Prof. Dr.Nina Jacobs, Faculty Guide for not only being a guide but also a mentor and his tireless support and guidance in the course of my project and its completion.

To Mr. Sanjay Singh, Area Sales Manager of Nestle India for giving me an opportunity to work on this project in Nestle. He took additional efforts to bring my report to its fulfillment and completion. His continuous encouragement through the freedom given to me to try out new things immensely helped me in understanding the concepts practically.

To Mr. Gurdeep Singh, for his keeping the continuous track of my work and performance and guiding me on my project.

To all my fellow colleagues and seniors too, for being an immense help to me in this project.

Last but not the least, I would like to express my thanks to god and my parents who have always helped me in giving the moral support whenever required.

Table of ContentsCertificate of Approval................................................................................................................................... iii

Certificate from Summer Project Guides.......................................................................................................iv

Abstract...........................................................................................................................................................v

Acknowledgement........................................................................................................................................vii

Introduction:...................................................................................................................................................2

HISTORY.......................................................................................................................................................3

DYNAMIC EXPANSION.............................................................................................................................4

NESTLE TODAY...........................................................................................................................................4

RESEARCH & DEVELOPMENT...............................................................................................................5

FMCG SECTOR IN INDIA..................................................................................................................................5

FOOD AND BEVERAGES...............................................................................................................................6

SWOT ANALYSIS..............................................................................................................................................8

OBJECTIVES OF THE STUDY...........................................................................................................................10

RESEARCH METHODOLOGY..........................................................................................................................11

WHAT IS RESEARCH METHODOLOGY?......................................................................................................11

OBJECTIVE OF THE STUDY:........................................................................................................................11

Primary Objective.................................................................................................................................11

Secondary Objective.............................................................................................................................11

RESEARCH DESIGN:.......................................................................................................................................12

ANALYSIS AND FINDINGS.....................................................................................................................15

RECOMMENDATIONS...................................................................................................................................24

FOR INCREASE IN THE SALE OF Nestea Iced Tea (CONSUMERS)...............................................................24

FOR INCREASE IN THE NESTLE ICED TEA (RETAILER).................................................................................27

APPENDIX.....................................................................................................................................................28

Annexure 1: QUESTONNAIRE FOR CUSTOMERS.......................................................................................29

Annexure 2: QUESTONNAIRE FOR RETAILERS...........................................................................................32

Introduction: Nestle India.

Nestlé India is a subsidiary of  Nestlé S.A. of Switzerland. With seven factories and a large

number of co-packers, Nestlé India is a vibrant Company that provides consumers in India with

products of global standards and is committed to long-term sustainable growth and shareholder

satisfaction.

The Company insists on honesty, integrity and fairness in all aspects of its business and expects the

same in its relationships. This has earned it the trust and respect of every strata of society that it

comes in contact with and is acknowledged amongst India's 'Most Respected Companies' and

amongst the 'Top Wealth Creators of India'.

The Company continuously focuses its efforts to better understand the changing lifestyles of India

and anticipate consumer needs in order to provide Taste, Nutrition, Health and Wellness through

its product offerings. The culture of innovation and renovation within the Company and access to

the Nestlé Group's proprietary technology/Brands expertise and the extensive centralized Research

and Development facilities gives it a distinct advantage in these efforts. It helps the Company to

create value that can be sustained over the long term by offering consumers a wide variety of high

quality, safe food products at affordable prices.

Nestlé India manufactures products of truly international quality under internationally famous

brand names such as NESCAFÉ, MAGGI, MILKYBAR, MILO, KIT KAT, BAR-ONE,

MILKMAID and NESTEA and in recent years the Company has also introduced products of daily

consumption and use such as NESTLÉ Milk, NESTLÉ SLIM Milk, NESTLÉ Fresh 'n' Natural

Dahi and NESTLÉ Jeera Raita.

Nestlé India is a responsible organization and facilitates initiatives that help to improve the quality

of life in the communities where it operates.  

HISTORY

Henri Nestlé founded Nestlé in 1866 in Switzerland. Nestlé means ‘little nest’ in Swiss German.

Nestlé first customer was a premature infant who could tolerate neither his mother’s milk nor any

other conventional substitute. Thus, Henri’s ultimate goal was to help fight the problem of infant

mortality due to malnutrition for which he developed a product combining various cow’s milk,

wheat flour and sugar and name it Farine Lactee Nestlé, which was the first product of Nestlé

being marketed in Europe.

In 1974, Jules Monnerat purchased Nestlé and collectively they launched a condensed milk product of its own. In 1905, Nestlé got merged with Anglo-Swiss condensed milk.

After some time, when Nestlé got fully established and all its operation were properly functioning

in Europe and was gaining fame around Europe, then Nestlé decided to set up production plants

around the globe to ensure the growth of the organization and to become multinational.

The decision to set up industrial operation in new market needs a lot of research, as there are

various factors that effect the growth of the organization and turns out to be a loss for the

company. Such factors are as follows

Availability of raw materials

Cost factor

Economic climate

Consumer purchasing power

Consumer tastes

The decision to become multinational turned fruitful for Nestlé and today Nestlé has its own

operations and products in America, England, India, Brazil, Australia, Pakistan, Hungary, France,

Belgium, Italy, Spain and various other countries around the globe.

DYNAMIC EXPANSION

The history of Nestle includes the development of many different products as well as acquisitions,

mergers and the purchasing of shares in companies, mainly abroad. Over the course of the years,

this enabled it to broaden its range of products and diversify its operations, while at the same time

strengthening the economic foundations of the company. Amongst the most important acquisitions

were Carnation in Los Angeles (milk, culinary products and pet foods) and more recently

Rowntree Mackintosh in York (chocolate and confectionery), Buitoni in Perugia (pasta) as well as

Perrier in France(mineral water). Nestle, which does 98% of its business outside Switzerland, also

has interests in non-food sectors, in cosmetics (a large share holding in L'Oreal) and ophthalmic

products (acquisition of Alcon Laboratories Inc.) while continuing to give priority to food products

NESTLE TODAY

Nestle is now the world's largest food company. It is present on all five continents, has an annual

turnover of 74.7 billion Swiss francs, runs 509 factories in 83 countries and employs about

231,000 people the world over.

The Company owes its current status to the pioneering spirit inherited from its founders which

continues to inspire it, to its concern with quality and to its constant search for new ways of

satisfying man's nutritional needs.

Wherever possible, it sets up factories locally, employs personnel from the country concerned and

relies on indigenous raw materials. Its agricultural services provide assistance to improve the

quality and yield of the raw materials it uses. Much attention is devoted to professional training

and to the integration of the Company in its economic and social environment

RESEARCH & DEVELOPMENT

Nestle, the world's biggest food Group, is also the global leader in the industry with regard to

Research and Development (R&D), No other food company matches the R&D presence of Nestle,

with a worldwide network of centers in 17 locations on four continents. No other food company

dedicates so many human and financial resources to R&D: an international staff of 3500 engaged

in the search for innovative new products and the renovation of existing ones. Year after year,

Nestle invests some 800 million Swiss francs into R&D as a major driving force of its double

strategy: to strengthen the Company's brands worldwide and to continue to support future long-

term growth and competitiveness through innovation and renovation.

At the threshold of this new millennium, Nestlé’s objective is to consolidate and strengthen its

leading position at the cutting edge of innovation in the food area, in order to meet the needs and

desires of consumers around the world, for pleasure, convenience, health and well being.

FMCG SECTOR IN INDIA

The Indian FMCG sector is the fourth largest sector in the economy with a total market size in

excess of $13.1 billion. It has a strong MNC presence and is characterised by a well established

distribution network, intense competition between the organised and unorganised segments and

low operational cost. Availability of key raw materials, cheaper labour costs and presence across

the entire value chain gives India a competitive advantage. The FMCG market is set to treble from

$11.6 billion in 2003 to $33.4 billion in 2015. Penetration level as well as per capita consumption

in most product categories like jams, toothpaste, skin care, hair wash etc in India is low indicating

the untapped market potential. Burgeoning Indian population, particularly the middle class and the

rural segments, presents an opportunity to makers of branded products to convert consumers to

branded products. Growth is also likely to come from consumer 'upgrading' in the matured product

categories. With 200 million people expected to shift to processed and packaged food by 2010,

India needs around $28 billion of investment in the food-processing industry.

FOOD AND BEVERAGES

The size of the Indian food processing industry is around$ 65.6 billion, including $20.6 billion of

value added products. Of this, the health beverage industry is valued at $230 million; bread and

biscuits at $1.7 billion; chocolates at $73 million and ice creams at $188 million. The size of the

semi-processed/ready-to-eat food segment is over $1.1 billion. Large biscuits & confectionery

units, soya processing units and starch/glucose/sorbitol producing units have also come up,

catering to domestic and international markets. The three largest consumed categories of packaged

foods are packed tea, biscuits and soft drinks. The Indian beverage industry faces over supply in

segments like coffee and tea. However, more than half of this is available in unpacked or loose

form. Indian hot beverage market is a tea dominant market. Consumers in different parts of the

country have heterogeneous tastes. Dust tea is popular in southern India, while loose tea in

preferred in western India. The urban-rural split of the tea market was 51:49 in 2000. Coffee is

consumed largely in the southern states. The size of the total packaged coffee market is 19,600

tonnes or $87 million. The total soft drink (carbonated beverages and juices) market is estimated at

284 million crates a year or $1 billion. The market is highly seasonal in nature with consumption

varying from 25 million crates per month during peak season to 15 million during offseason. The

market is predominantly urban with 25 per cent contribution from rural areas. Coca cola and Pepsi

dominate the Indian soft drinks market. Mineral water market in India is a 65 million crates ($50

million) industry. On an average, the monthly consumption is estimated at 4.9 million crates,

which increases to 5.2 million during peak season.

NESTEA ICED TEA

NESTEA Iced Tea: NESTEA Iced Tea is a special blend of natural tea & natural fruit flavour. Its

so convenient to make that now you can enjoy your favourite iced tea at home. 1 glass of NESTEA

Iced Tea provides with 50% of daily requirement for Vitamin C. It comes in two flavours Lemon

and Peach.

NESTEA Iced Tea with Green Tea: NESTEA Iced Tea with Green Tea brings natural, healthy

goodness of Green tea into your glass. Green tea is a good source of NATURAL

ANTIOXIDANTS which are known to protect body cells from damage caused by free radicals. It

comes in Mint flavour.

SWOT ANALYSIS

STRENGHTS The strengths of Nestea Iced Tea are as follows:

Company’s name Nestlé” signifies the quality image high standard and quality product

Loyalty from customers is also the major strength for the company.

Employees are also loyal due to the decentralized culture of company.

People trust on products due to the proper health and safety measures.

Very Few Products in this iced tea category. Other products available are imported like Lipton’s Iced Tea

Being a multinational company it has the capability to attract more customer than the local companies.

Company has the ability to compete in a dynamic environment.

Company always adapts the new technology

WEAKNESSES

The weaknesses are as follows:

There is not much margins for retailers to prefer it’s sales

Main weakness is that product is not available in small packs of Rs 1 or 2 like competitors

tang and rasna which is affecting the penetration of the product in the market.

The distribution cost is high as compared to the competition in the local market.

Advertisements of Iced tea should increase.

OPPORTUNITIES

Company can open separate stores to eliminate retailers.

Company is trying to open stores in universities.

They can provide incentives to retailers to increase sales volume.

Company can start selling the products through chemists shops also if it is introduced in

small packets.

THREATS

Existing companies are increasing their product lines that can prove to be a threat in the coming years.

Company like Pioma Industries(Rasna),Kraft Foods(Tang) is giving more discounts to retailers as compared to distributors due to which retailers prefer its products for sale.

As compared to the local competitors, our distributor cost is very high. As Nestlé products has to maintain and obey the Nestlé standards.

Some companies are competing on the basis of cost.

OBJECTIVES OF THE STUDY

To Study the availability of Nestea Iced Tea & scope of expansion among the end customers and retailer satisfaction level with Nestea Iced Tea viz a vis its competitors in the condensed powder form refreshing drinks segment in west Delhi region.

1. To meet customers to get information regarding their perception about Nestea Iced Tea

2. To meet customers to know what are the reasons for not having Nestea Iced Tea.

3. To meet customers and find out the reasons for their preference of any other refreshing

drink over Nestea Iced Tea

4. To meet customers to find out what influences their buying decisions

5. To understand the needs and trends of the end customer and analyze how Nestle fits into

the scheme of things

6. To meet retailers and find out what is their perception about Nestle India ltd

7. To meet retailers and find out what more they accept from Nestle India ltd viz a viz its

competitors

8. To identify scope of improvement in the beverages category of Nestle

RESEARCH METHODOLOGY

WHAT IS RESEARCH METHODOLOGY?

Research Methodology may be defined as, scientific and systematic search for information

require on a specific topic. In short research is an art of scientific investigation. Thus it is a

movement, i.e. from known to unknown.

Research comprises defining and redefining problems formulating hypothesis or suggested

solutions. Research methodology refers to the tools and methods used for obtaining information

for the purpose of the subject under study.

OBJECTIVE OF THE STUDY:

The objective of the study is divided into two parts:

Primary Objective

The main objective is to Study the availability of Nestea Iced Tea & suggest scope of expansion.

The aim behind it is to help the Management of Nestle in bringing improvements in sales,

distribution, merchandising strategy so that sales can be increased.

Secondary Objective

The secondary objective is to find out the Retailer satisfaction level with Nestle India viz a viz

its competitors in beverages segment. The aim behind it is to find out the relationship between

Nestle and its retailers in the west delhi region as compared to its competitors; so that Nestle can

improve its relations with the and corrective measures can be taken if at all there exists any

problems.

RESEARCH DESIGN:

The kind of research I have done is called APPLIED RESEARCH. Where one has to solve a

current problem faced by the manager in the current setting, demanding a timely solution. For

the purpose of this study initially I used exploratory research in the form of an exhaustive market

survey of various retailers and customers in wesr delhi region which equipped me with requisite

knowledge. In the later stages of research around 200 end customers and 150 retailers were

targeted. I have used a combination of both descriptive and casual research to fulfill the above

stated objective

TYPES OF DATA

1. PRIMARY DATA:

Primary data is that data, which is, collected a fresh for the first time and thus happens to be

original in character. In the study, primary data is collected with the help of:

a. Questionnaire:

It is a popular means of collecting all kinds of data in research. A structured questionnaire was

used which consisted of both open ended and closed ended questions.

Open Ended Question:

In these types of questions, the answers totally depend upon the judgment of the respondent.

They are generally asked about their opinion and suggestions of the respondent.

Closed Ended Question:

These are objective type questions in which the respondent is given certain choices amongst

which he has to choose the most appropriate option.

b. Interview:

It is a process of communicating and interacting with the respondents in which the subject or

interviewee gives the needed information verbally in a face-to-face situation. In this study, direct

questions were asked from the customers, retailers in order to extract maximum information

from them

c. Observations:

Observation method refers the information collected by way of investigator’s own direct

observation without asking from the respondent

2. SECONDARY DATA:

Secondary data are those, which have already been collected by some one else. Secondary Data

sources for this study are:

Website of Nestle

Magazines

Articles and newspapers

DATA COLLECTION METHOD

Based on initial market survey, two detailed questionnaire were made both for the

consumers and retailers

Personal visits to the wholesalers and the distributors of Nestle India

Access to various websites.

SAMPLE DESIGN:

For end customers Convenience sampling was used and a sample size of 200 was taken. For

retailers we were given the data of the retailers in the west delhi region and to collect data from

150 retailers simple random sampling was done. Thus these two techniques proved to be very

fruitful for the data collection

SAMPLE SIZE

End consumers : 200 subjects

Retailers : 150 subjects

ANALYSIS AND FINDINGS

Customers

1. Out of the total respondents only 48% had ever used Nestea Iced Tea.

2. Out of 96 consumers who used Nestea Iced Tea

38.5% agreed that quality of Nestle is high

36.5% consumer feels that Nestle provide value for money 42.7% found packaging appealing 70.8% feel it is easily available in the market. Only 36.4% found that it is well placed on the store shelves and is recommended by

the sales person. Only 13.5% agreed that the promotional schemes are satisfactory

Only 32.3%% people agreed that the product satisfied them

Only 20% agreed to use Nestea in future

Percentage of people who ever had Nestea.

YesNo

3. 78% of the respondents claimed to see the advertisement of Nestea Iced Tea.

Percentage of people who had viewed

Nestea's add. ViewedNot

4. Out of the respondents surveyed, 78%

appea

ling

messag

e is c

lear

can ea

sily re

late t

o it

easily

recal

l it

persuasi

ve0.00%

20.00%

40.00%

60.00%

80.00%

100.00%

120.00%

strongly agree

strongly agree

agree

neither agree nor disagre

disagree

a. 32.5% found it appealing

b. 49.5% found that the message is clear

c. 30% found that they can easily relate to it

d. 38% found they could easily recall it

e. 18.5% respondents found the advertisement persuasive

5. 80% of the respondents prefer herbal tea.

6. 85.5% of the respondents were aware of Nestea iced tea

7. 66.5% of the respondents are aware that Nestea has a herbal variant(green tea).

Awareness about green tea Aware

Not Aware

8. Of the 96 people who had tasted iced tea 50 preferred lemon flavor,21 peach flavor,25

preferred green tea(mint flavor)

Flavour Preferrence

Lemon

Peach

Mint

9. Various attributes influencing the buying decisions

QUALITY

ADVERTIS

EMEN

TS

CELEBRITY

ENDORSE

MENT

BRANDPRICE

PROMOTIONAL S

CHEMES

PACKAGING0

10

20

30

40

50

60

70

Strongly disagreedisagreeneitheragreestrongly agree

IN %

a. 81.5% agree that quality is a factor

b. 41% feel that advertisement influence their buying decision

c. only 17.5% think that celebrity endorsements influence their buying decisions

d. 77%respondents feel that brand makes a difference

e. 57.5% feel that price is an important factor

f. For only 35.5% people, promotional schemes matter

g. 51% consumers feel that packaging influences their buying decisions

10. The consumer promotion most desired by the customers were free gifts,1+1 free and 25%

extra

11. The reasons why the people stopped using Nestea iced as told by the respondents were that

they sometimes feel more thirsty 5 min after having Nestea iced tea.

RETAILERS

In order to find out the retailer satisfaction level with Nestle India ltd viz a viz its competitors in

the beverages segment, data from 150 retailers was collected and then analyzed. Given below are

the findings from the data

1. Out of 150 retailers 52% sold Nestea iced Tea

Retailers

SellDo not Sell

On an average according to the retailers the sale of Tang was maximum in the posh

markets of west delhi such as dwarka,Punjabi bagh, Paschim Vihar and that of Rasna

was maximum in lower end markets like nangloi,madipur,Vikas Nagar. Sales of

Nestea iced Tea were minimum in condensed powder form refreshing drinks category.

2. Out of 95 retailers that answered that sachets and smaller packs sell more as compared to

half kg packs especially in the lower end markets, 58.% said that sachets are sold more

3. 54% of 150 retailers said that display of the sachets effect the sale of the sachets

4. Reasons for sale of most preferred refreshing drink.

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

noyes

a) 52.7 % of the retailers said that packaging is not an important reason for the sale of most

preferred refreshing drink.

b) 80% said that quality is a reason

c) 65.3% said that brand loyalty is a reason

d) 62.7% say that promotional schemes are a reason

e) 82.7% say that product awareness is a reason

f) 73.3% say that product visibility is a reason

g) 80.7% say that customer satisfaction is a reason

h) 57.3% say that product variants not a reason

5. Out of the total 150 respondents,

a) 72.66% retailers agree that Schemes offered by the company affect the retailing of

the product. At times the company offer them discounts and special schemes so

they buy in bulk in these cases

b) 59.3% agree that timely delivery of the order affect the buying decision

0.70% 4.70%

22.00%

45.30%

14.00%

Chart Title

strongly disagreedisagreeneither agree nor disagreagreestrongly agree

strongly disagree4% disagree

4%neither

agree nor disagre

19%

agree58%

strongly agree15%

Chart Title

c) 49.3% of the retailers neither agreed nor disagreed that mode of payment affect the

retailing; as most of the transactions take place on credit

0.70%4.70%

49.30%

22.70%

6.70%

strongly disagreedisagreeneither agree nor disagreagreestrongly agree

6. There are many tactics used by the companies to promote their sales. One of them is the display

schemes. The companies rent out windows in the shops and pay the retailers some amount of

money or rent to display their products in those windows. This is done in order to increase the

visibility of the product

a. Nestle gives around 2-3% of sales for a window for visibility.

b. Pioma Industries gives(Rasna) around Rs 250 to 350(fixed for smaller shops) for their

window and 4-5% of sales at good retail outlets and sometimes some gifts the shops which

has high sale figures

c. Similar is the case with Kraft foods(Tang) who gives 3-4% of sales for display windows.

7. Profit margin earned by the retailers behind the sale of every pack of every company

a. Nestea Iced Tea – they earned the profit of 9 % behind the sale of any pack of Nestea Iced

Tea. Other than this no other schemes are offered to boost sales.

b. Pioma industries(Rasna) – retailers earned profit of 12 – 14 % for every sale of Rasna pack

accompanied by other schemes in addition to this margin on the basis of stock they buy.On

an average thy get additional 2-4% margin.

c. Kraft Foods(Tang) – margin of 14 to 15 % and additional schemes depending on stock

capacity of retailer.

8. Retailer cycle of buying

a. Most of them said that their cycle of buying Nestea Iced tea is weekly

b. But the stores in high end markets bought tang biweekly and similarly rasna is bought

biweekly in lower end markets.

RECOMMENDATIONS

The project on Nestea Iced Tea has proved to be very informative and has helped me a great deal

in understanding the refreshing drinks industry. After analyzing the facts and figures from close

quarters there are certain recommendations that should be given a thought and if incorporated, they

would help in the positive development of the company.

FOR INCREASE IN THE SALE OF Nestea Iced Tea (CONSUMERS)

1. AGGRESSIVE CAMPAIGNING: This should be done both at local level and

National level. At the National level more appealing Ad campaigns should be done

and the frequency of these Advertisements should be increased. Hoardings should

be placed at strategic places like bus stands, Railway stations etc

2. PACKAGING SHOULD BE MADE MORE APPEALING. Sachets should be

introduced. They are required to increase penetration in the markets.

3. IT SHOULD BE ENSURED THAT ICED TEA PACKS ARE WELL

PLACED ON THE SHELVES. They should be kept with other refreshing drinks

rather than being kept with other hot tea products

Should not be kept at this place.

Should be kept in these shelves.

These are pics of the same store

4. PROMOTIONAL SCHEMES: There should be good Promotional schemes for

the customers eg, Cash Discounts.Free gifts , buy one get one free offers etc. 1L

pitcher given free with 500g pack actually increased the sales. Retailers were found

to be more willing to keep the stock after the scheme was introduced.

5. AWARENESS THAT HERBAL VARIANT (GREEN TEA) IS AVAILEBLE

SHOULD BE INCREASED

6. DISTRIBUTION OF FREE SAMPLES TO INTRODUCE THE PRODUCT

WHERE PENETRATION IS LOW.

7. MORE VARIANTS OF THE PRODUCT SHOULD BE THERE: This is one

reason why rasna and tang are selling more.They are having more flavours.

8. REGULAR SURVEYS SHOULD BE DONE TO KNOW WHAT ARE THE

CHANGING DEMANDS OF THE CUSTOMERS.

9. VARIOUS COLLEGE FESTS SHOULD BE SPONSORED BY NESTLE

ICED TEA SO THAT THERE IS INCREASED AWARENESS OF THE

BRAND AMONG THE YOUNG CROWD

FOR INCREASE IN THE NESTLE ICED TEA (RETAILER)

1. The concept of CRM (Customer Relationship Management) should be adopted.

The relations with the retailers and wholesalers should be made friendly and

feedback should be taken from them at regular interval of time so as to know

what type of problems are they facing while using your product and what

improvements can be made.

2. Increase the Retailer base and Target retailers which have large customer base

and high sales

3. It should be taken care of that Retailer has adequate stock of the product .

problem of unavailability of the product should not be there

4. The company should try to provide some more attractive incentives to the

dealers as they also play a role in the sale of the product

5. The companies like Pioma Industries AND Kraft Foods are giving more margin

to the retailers in the beverages segment. Nestle should also follow suit and

give more margin to the retailers

6. Visibility of the product in the market should be increased and Display schemes

should be given to the Retailers so that the product is visible

7. Timely Gifts should be given to the retailers

8. Retailers who do good sale of the product should be rewarded

9. Cash Discounts should be given to the retailers

10.Occasional competitions should be organized for the retailers to develop good

relation with them

11.Their grievances should be addressed

12.The sales force should be dynamic and well informed

13.The salesmen should be properly trained and their regular visits to the retailers

should be ensured

14.Product replacement for the retailers should be facilitated

APPENDIX

Annexure 1: QUESTONNAIRE FOR CUSTOMERS

OBJECTIVE:- To study the brand preference of Nestea Iced Tea .1. Name: …………………………………………………………………………………………..

2. Occupation: ………………………………………………………………………………….

3. Family Monthly Income:Below 25000 25000-50000 50000-1 Lac 1 Lac and above

4. Location: ……………………………………………………………………………………….

5. Age:15-25 25-35 35-45 45 and above

6. Family type: Joint Nuclear

7. Do you consume Iced Tea?Yes vNo

8. Which brand you prefer the most in Refreshing Drinks(available in condensed powder form)?

Nestle Iced teaTangRasnaOther ....………………………………………………………………………………….

9. Have you ever used Nestea Iced Tea?Yes No

10. If no , it is because :Lack of awarenessLack of availabilityYou find it expensive

You don’t like the productOthers …………………………………………………………………………………….

11. You came to know about Nestea Iced Tea from :Newspaper advertisementsRadioT.V. advertisementsWord of mouthPoint of saleOther source……………………………………………………………………………..

12. Do you remember any of the T.V. advertisements of Nestea Iced Tea?Yes No

13. Have you tried new variants of Nestea Iced Tea after viewing the advertisements?Yes No

14. What is the level of discounts /offers available with Nestea Iced Tea?High Medium Low

15. Which of the offers will influence you the most to purchase Nestea Iced Tea?Extra offeredBuy one get oneFree giftsOther ………………………………………………………………………………………

16. Is Nestea Iced Tea easily available to you?Yes No

17. From where do you usually purchase Nestea Iced Tea?Nearby storeRetail storeWhole seller

18. Which flavor of Nestea Iced Tea you like the most?LemonPeach

Mint (Green Tea)

19. What is the size of Nestea Iced Tea you usually purchase?

20. How frequently you purchase Nestea Iced Tea?Every weekEvery forth nightEvery monthOccasionally

21. Any further suggestions: ……………………………………………..…………………………………………………..………………………………………………………………………………………………….

Annexure 2: QUESTONNAIRE FOR RETAILERS

1. Name: …………………………………………………………………………………………..

2. Occupation: ………………………………………………………………………………….

3. Sales of Nestle items pm: 25000 25000-50000 50000-1 Lac 1 Lac and above

4. Location: ……………………………………………………………………………………….

5. Do you sell Nestea Iced Tea

Yes No

6. What Sell most in beverages available in powder form

a)Nestea Iced Tea

b)Rasna

c) Tang

7.What sizes are sold most

a)sachets b)smaller packs(100g-200g) c)larger packs(>=500g)

8.What factors effect the sales of refreshing drinks(can mark more than one)

a) packaging

b) quality

c) brand loyalty

d) promotional schemes

e) product awareness

f) product visibility

g) customer satisfaction

h) product variants

9.What factors you consider while keeping a stock of a company

a) Schemes offered by the company

b) delivery of the order

c) mode of payment