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Our strategy is to focus on innovative products in new categories

Nadia Chauhan, joint managing director of Parle Agro, is chalking out fresh strategic plans to take on multinational players in the Indian FMCG industry.

Nadia Chauhan, joint managing director of Parle Agro, is chalking out fresh strategic plans to take on multinational players in the Indian FMCG industry. The company?s strategy includes revamping packaging, export initiatives, extension of rural penetration and manufacturing facilities. For the first time, the company is introducing its apple drink ?Appy Fizz? in cans and returnable glass bottles (RGB) at select metros. A few months ago, the company began introducing its fruit drink Frooti and Bailley Soda in RGB formats in rural markets, to start with. It has recently set up two franchise manufacturing facilities in Nepal and Bangladesh. In an exclusive interview with FE?s Lalitha Srinivasan, Chauhan speaks about Parle Agro?s growth plans. Edited excerpts:

What are your organic growth plans for Parle Agro?

Every year we expand our distribution network by 20-30%, but this year we have extended it by 40-50%. Accordingly, we boosted our manufacturing capacities. Also, we extended our beverage brands presence by launching for the first time in the RGB format through a franchise network. Currently, we have five RGB manufacturing factories for our brands. We plan to have 20 factories (RGB) in the next two or three years for a national roll out of all our brands in RGB format.

What?s going to be your strategy to fight multinational competition?

Our key strategy is to focus sharply on innovative products in new categories. This value continues to be a strong part of our long-term vision and our investment. Our belief in innovation has allowed us to compete with multinational giants and yet gain market leadership position across various categories. We hope to close this year with a 50% growth rate.

Tell us about your new packaging initiatives to promote Parle Agro?s brands in rural and urban markets.

We are in the process of launching our brand Appy Fizz in cans and RGB. While the RGB format makes its entry only in small towns and rural markets targeted at the rural youth, cans will be launched only in metros and will strengthen the premium image in urban India. RGB is also an important format for metros, and we will gradually build our presence within metros as well with the new format. Frooti, our flagship brand along with Bailley Soda, Dhishoom and Frio were recently launched in RGB to augment our channel

What are your export plans?

We have a presence in over 40 international markets through exports. We have also recently set up two franchise manufacturing facilities in Nepal and in Bangladesh and the year ahead will see various other markets including Africa with local manufacturing to further grow. Sri Lanka, GCC, and even some markets in Europe are part of our immediate global expansion plans.

Are you planning to foray into new categories this year?

We are looking at some key launches over the next one year within both the food and beverages space. We are launching a new Softease coffee variant in our confectionery range. We have just added a new range of munchies to our snack brand Hippo called ?World Toasties?. We will continue to invest in R&D projects and introduce new experiences and launches to our consumers.

Do you see a slowdown in consumption in rural and urban India? How do you plan to accelerate your rural penetration in India?

No, on the other hand, there has been an increase in consumption in rural markets with higher disposable incomes. However, compared to urban markets, the rural market is price sensitive in nature and is characterized by lack of distribution and retail infrastructure. To accelerate rural consumption in India we have introduced five of our beverage brands in RGB formats. In addition we have also launched special products only for rural markets. Our expansion in the RGB space will enable us to penetrate the market further and expand our footprint in virgin territories thus increase market share.

What are Parle Agro?s cost-cutting measures to tide over the economic slowdown?

The most important thing is to constantly create high efficiency in the entire system. Be it manufacturing or even sales & distribution. That?s what we are focused on.

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First published on: 17-10-2012 at 00:51 IST
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