MARKETING PLAN

VANGILI FEEDS

SUBMITTED BY:
Salman Shaji(10UTB11) Sharanya KK (10UTB15) Sneha Gunashekharan (10UTB27) Srinivasan M (10UTB32) Andrea Anbumalar (10UTB50)

COMPANY BACKGROUND
Businesses in the poultry industry. Mr. V. Subramaniam is the founder who started a small poultry farm with 500 layer birds and reared them in a small tiled shed in the name of VANGILI EGG CENTRE. Now Mr. Subramaniam is one of the big industrialists in the poultry field in Namakkal by having Two Feed mill units, Two Commercial Layer Farms, Two Broiler Breeder Farms and a hatchery unit, and rearing about 800000 commercial Broiler Birds in various integrated forms. M/S. VANGILI FEEDS is a partnership concern consisting of Mr.V.Subramaniam and S.Selvi.

 This firm started in the year 1985. The unit started as a Small Scale Industrial unit and also duly registered with the Director of Industries & Commerce., Tamil Nadu. The unit is also engaged in the manufacturing of Poultry feed. They are one among the three big feed manufacturing units in Namakkal. The unit is working in a profitable manner for the past 21 years without any set back (or) interruptions

Company Offerings: Vangili Eggs, Vangili Chicken, Vangili Chicken Feed

Vision: To innovate and implement strategies that create value for customers by providing them with high quality food products that serve people across the country. Mission: Superiority in Quality - To give utmost care to what we produce using resources judiciously and by raising the poultry naturally so that our customers relish every bite and to contribute to our community and its welfare.

COMPANY MILESTONES
1980 Poultry Farm 1997 Starting Gayathri Poultry farms 2011 Expansion for frozen chicken

1985 Chicken feed production

1996 Acquisition of Hemanth Farms

1989 Firm Expansion

1992 Setting up Vangili Hatcheries

CURRENT POSITION OF THE FIRM

Marketing efforts: Word- of- Mouth Strategy Current sales volume: 800,000 live birds and 100,000 frozen chicken (under the brand name Vangili) per month. Market share: 3.45% of the total sales to Chennai and Bangalore. Turnover for the year 2010: Rs.130 Crores Current Growth rate: 15%. Brand measurement was recently analysed by the company and it was found that the ARS Persuasion number is 8.

PRODUCT
High quality live and frozen chicken: - 8% fat content (industry avg- 10%) - 77-78% Breast Meat yield (industry avg- 75%)

PROMOTION
Word- of- mouth strategy was mainly used as the company and the founder highly reputed

MARKETING MIX PEOPLE

Around 300 people totally No special training except On-thejob for a week before recruitment Technicians recruited are usually experienced

PRICE
Varied fluctuations for livestock market Constant price for a maximum of 2 days

ORGANISATIONAL RESOURCES
Financial Resource: Bank loans (mostly term loans) for funding their business. 70% of each of their projects is funded using bank loans and the rest is through their retained earnings. In case of shortage, the money for suppliers will be withheld to make adjustments for working capital. Human Resource: Shortage of about 30%. To make up for this, the firm makes use of shifts and over-time duties for which the workers are paid extra. Experience: The managing director of the firm feels that the company has yet to keep growing in various aspects. Relation with traders: The traders do not have much say in the firms decisions. The major supplier of the firm is Venkateshwara Hatcheries (P) Ltd. for which Vangili Feeds is an associate. The supplier plays a strong role in the decision making processes of the firm.

CULTURAL AND STRUCTURAL ISSUES

Planning: The firm mainly focuses on short- term planning. For example, the firm aims to earn a total turnover of Rs. 500 Crores by 2012. Customer Orientation: No direct customer contact but the firm conducts monthly surveys to identify the customer tastes and their brand preferences. Willingness to embrace change: The company is a family- owned business and hence there are no conflicts in power and authority. Position of the Marketing function: The culture of the poultry industry, especially in Tamil Nadu, is such that no formal advertisement is needed other than Word- of- mouth. Changes in executive positions: The current Managing Director is the founder of the firm. Hence they have been no changes in key executive positions. General employee satisfaction and morale: 70% of the firms employees are working in the company for a minimum of 5 years and they show high satisfaction levels.

CUSTOMER ENVIRONMENT
SEGMENTATION a) Demographic Segmentation The demographic segmentation is done based on Religion and Race. The population of Chennai: 4.681 million The population of Bangalore: 8.474 million Potential consumers: 4.629 million people in Chennai and 8.372 million people in Bangalore. (excluding Jains and Buddhists)

However, the Brahmins belonging to Hinduism do not eat chicken. The Hindu population of Chennai consists of 27.68% of Hindus which accounts for 1.053 million of the total population of Chennai. Similarly for Bangalore, 31.34% of the Hindus are Brahmins which accounts for 2.106 million people in Bangalore. Thus by demographic segmentation the total potential consumers of the firm totals to 9.842 million.

b) Psychographic Segmentation Psychographic segmentation is done based on occasions and lifestyle. Occasions: The peak- season for buying chicken includes festivals like New Year, Pongal, Easter, the month of Ramzan, etc. During this time the firm prepares itself to produce (on an average 12%) more than the normal production time. Similarly the off- season times include the month of Mandalam, Lent for Easter, etc. During this period, the firm anticipates a 15% decrease in sales on an average. Lifestyle: Most people, especially in the metropolitan areas are becoming more health- conscious due to Health and Obesity problems and they become vegetarians due to the fat content of chicken. Thus the firm produces chicken with lower fat content to target these consumers.

c) Product Usage The heavy users of the product are hotels like Vangili International (Company- owned), Jayamahal Palace Hotel (Bangalore), Crescent Park (Chennai), etc. The firm supplies to a total of 18 hotels in Chennai and Bangalore who order bulk quantities on a regular basis. This is a more stable source of income for the firm. However, the majority of sales volume comes from the medium or light users who buy randomly from shops. On an average, families in India buy chicken twice a week. PURCHASE PROCESS: The purchasers are usually housewives who buy chicken for the family. The product however is used by the entire family. The influencers are usually the children or the men in the house who prefer non- vegetarian.

POINT OF PURCHASE OF PRODUCT: Usually, traditional chicken selling shops in the area. However, an increasing number of people are buying the product from supermarkets, while institutions buy from wholesale outlets. The purchase of the product is not under the firms control. It is generally based on seasonal patterns and surroundings. SELECTION OF PRODUCT BY CONSUMERS: The quality of the product is high in comparison with their competitors which is a major benefit for the company. The demand for the product is not expected to change much in the near future. The exchange processes is essentially ongoing as people usually prefer to buy chicken from shops close to their homes on a regular basis. POTENTIAL FOR CONVERTING NON- USERS INTO USERS: Great potential if a significant amount is invested in promoting the product. This will increase the reach of the product to the consumers and increase brand awareness of the product.

THE EXTERNAL ENVIRONMENT

MARKET ANALYSIS:

The organised sector of poultry industry is contributing nearly 70% of the total output and the rest 30% in the unorganized sector. Well dominated in southern states with nearly 60-70% total output coming from these states. The National Institute of Nutrition has recommended 11 kg of meat per capita consumption for our country. At present, Per capita availability of meat is 1.6 kg. India is the ninth largest producer of poultry meat. India was positioned 17th in the world poultry production. The Indian poultry production is considered to be the cheapest in the world. Indian poultry industry has been growing at annual varying rates of 8-15%. At present the industry is estimated at over Rs 60,000 crore. India produces 1,400 million chickens a year, which is close to 27 million a week, of which 95% is traded alive. The poultry production and consumption in the domestic markets was estimated at approximately 2.3 million tonnes by 2010.

 Market Analysis for Tamil Nadu: Tamil Nadu was produces 8.0 million eggs / day. Tamil Nadu has 25% market share of the country. Market Analysis for Karnataka: Karnatakas egg production accounts for 2.5 million to 7.5 million eggs/ day. The state has a market share of 15.625% in the country. However, Karnataka has a high sales tax of 12% for dressed chicken. (Source: http://agro.indiamart.com/agriculturalcommodities/eggs.html)

COMPETITOR ANALYSIS
Suguna PoultryThe firm is well- established with a large market in India. It is a national brand situated in Tamil Nadu. The firm has a turnover of 1100 crores and a market share of 27.27% in the competing area of Vangili Feeds mainly, Chennai and Bangalore. The Point of Difference of the firm is their Low Operating Costs which gives the company a high margin. Also Suguna Poultry is the only firm in the poultry industry with ISO 9001: 2000 certification. They are the market leaders in bringing innovative products to their offerings. Many of the products include Suguna Homebites, Suguna Fresh, Suguna Ready- to- eat, etc. (Source: The Hindu Business Line)

Swami Feeds- Swami Feeds is a local brand in Namakkal which is rapidly growing. The firm is also an associate of Venkateshwara Hatcheries and is earning a strong reputation, also because of their quality standards that is comparable with that of Vangili Feeds. The firm has 6.36% market share in the areas of Chennai and Bangalore.

ECONOMIC GROWTH AND STABILITY

The economic condition of the industry is growing at varied rates of 8 to 15% and firms in the industry are obtaining high revenues. However, this has attracted many new entrants to the industry which shall affect the revenues obtained by the firms. Chennai: According to Forbes magazine, Chennai is one of the fastest growing cities in the world. As of 2000, the city's total personal income was 12,488.83 crores, making up 10.9% of the total income of Tamil Nadu. According to the CII, Chennai is estimated to grow to a $100-billion economy, 2.5 times its present size, by the year 2025. Bangalore: Bangalore's 52,346 crore economy (200607 Net District Income) makes it one of the major economic centres in India, with the value of city's exports totalling 43,221 crore in 200405. With an economic growth of 10.3%, Bangalore is the fastest growing major metropolis in India.

POLITICAL TRENDS: Changes in the political scenario have little effect on the industry. LEGAL AND REGULATORY ISSUES: There are no stringent rules or regulations with regard to the poultry industry yet. But the firm anticipates that rules may soon be emphasized especially regarding Pollution Control. The National Egg Coordination Committee currently has around 25000 framers and is one of the largest association of poultry farmers in the world. The General Insurance Corporation (GIC) of India has introduced poultry insurance which covers the following: comprehensive cover for poultry farmers; epidemic poultry insurance through hatcheries; and poultry insurance schemes for parent stock through hatcheries.

TECHNOLOGICAL ADVANCEMENTS: The improving technology can be efficiently utilized in the poultry industry. Manufacturing of the chicken feed can be increased with a welldeveloped and integrated feed plant. Distribution in the firm at present is not a problem for the company as the retailers come to the farm to collect the products but expansion will definitely call for a well- defined logistics by the firm. The company senior executives do not prefer any partnerships at present. The EC shed which is one of the most famous technologies in the industry for automatic temperature cooling. The firm has altered the EC shed and has developed the technology to integrate with the other processes of the firm (like periodic medicine spraying) to make up for the labour shortage faced. Disadvantages are: availability of technical persons to handle the equipment and the possibility of side effects.

SOCIOCULTURAL TRENDS: The firms target customers, at present, include the people of Chennai and Bangalore. The main changes expected are the change in attitudes towards non- vegetarian food. However, the increasing number of middleclass families with increasing incomes witnessed in metropolitan areas indicates that the demand for chicken will be somewhat stable.

SWOT ANALYSIS
STRENGTHS
High quality products available 26 years experience in the field Cash sales only accepted Management decisions are taken quickly Managers and staff are given freedom Improving technological knowhow

WEAKNESSES
Labour shortage of about 30% in the firm High labour turnover due to stringent performance measurements by the firm No formal hierarchy Managing Directors direct involvement with staff to solve problems not usually taken in the right sense by the employees

OPPORTUNITIES
Huge scope for Sale of semiprocessed chicken in the industry Own retail shops for poultry farmers Contract farming to obtain raw materials for feed easily

THREATS
Decreasing raw material availability for making chicken feed Strict Regulations and protests due to pollution problems in farms (fly infestations) High pricing leads to many new entrants in industry Growing disease concerns

MARKETING GOAL A
To invest significantly in marketing efforts in 2012 to nationalize the brand and to increase the market share.
30.00% 25.00% 20.00% 15.00% 10.00% 5.00%

Objectives: To utilize current market to full potential To increase brand awareness among consumers To obtain a high share of voice by advertising for the product
0.00% SUGUNA SHANTHI VHL SWAMI VANGILI

MARKETING GOAL B
To implement new Product- Market strategies by product innovation and attracting untargeted segments. Objectives: To enhance value of product for customers To create new offerings for customers To compensate for the existing live chicken product that is in maturity stage

REVISED MARKETING MIX

a) Potential target markets: Utilize the current market of Chennai and Bangalore to its full potential. Health- conscious people should be targeted also by providing products suitable for them. Being a poultry industry, this is difficult and hence special care must be taken to serve them b) Product: Continue production with no hormones injected. Include new products in the firms offering Processing and sale of separate parts of chicken like thigh, legs, breast, liver, etc. Sale of ready- to- cook varieties

c) Pricing: The pricing strategy will remain the same ( Re.1 higher than competitors) to emphasize on the high quality of the product. Also the firm must try and give high margins to retailers so that the brand is more encouraged in retail stores. Live Chicken: Current Overall production Cost: Rs.46 (for chicken of around 2 kilogram weight on average) Current Selling Price: Rs. 83 per kilo Frozen Chicken: Current Overall Production Cost: Rs. 74 (for chicken of around 1.4 kilos average) Current Selling Price: Rs.120 per kilo

Separate Parts: The production cost will not show significant increase as the equipment needed can be integrated with the processing equipment of frozen chicken. Pricing shall be done based on the kind of parts sold. For example: Liver pieces can be charged higher due to their medicinal value. Ready- to- eat Varieties: The production cost will show a significant increase based on the marinade required for each recipe. Pricing shall be done based on the recipe.

d) Promotion: TV advertising Highlight the quality of each product and the benefits for the consumer. The company is an associate of Venkateshwara Hatcheries Pvt Ltd which is a nation- wide brand and is ranked in the top 3 of its total associates for their production cost. This fact must also be highlighted. Health awareness programs Emphasize on the importance of chicken with lower fat content for consumers Brand Ambassador for endorsing the brand For increased publicity among the people Sponsoring TV shows To get widespread reception from audience Joining hands with the local poultry associations Create a general awareness about the product

e) Distribution: The firm could start its own retail outlets so as to have direct contact with consumers and can hence respond to changes in the market situation in a faster way. Also increase relationship with retailers by providing high margins. f) People: Hire more technical staff for successful implementation of newer technology. Since most of the labourers in the farm itself, they can be rotated across different company- owned hatcheries and farms that shall help kindle interest.

VANGILI CHICKEN
Superiority in Quality High breast meat yield! Zero hormones injected

Low fat content!

Try our Ready- to- cook packs to please your sudden guests!!

At Vangili Outlets near you

Chicken lollipop Liver fry Chicken wings Chilli Chicken

.
(all made easy through our separate packaging)

We strive to give you the best quality chicken so you can relish every bite of your dish!!!

CONCLUSION
We have attempted to prepare a marketing plan for the firm, Vangili Feeds. After detailed situation analysis and carefully weighing the opportunities for the growth and development of the firm, we have suggested strategies that will help the firm to strenghten their foothold in the poultry industry.