Contact at least three people at your school or a nearby company who use information
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This project aims at understanding the overall Chocolate Industry in India, the product portfolios of different players in the market, various factors affecting the growth and success of chocolate industry in India, the challenges and opportunities which the market offers and the changing trends in the Indian Chocolate Industry. The project also covers a brief study of Cadbury's India with reference to above points. An Overview of Chocolate Industry in India The chocolate industry in India as it stands today is dominated by two companies, both multinationals. The market leader is Cadbury with a lion's share of 70 percent. The company's brands (Five Star, Gems, Eclairs, Perk, Dairy Milk) are leaders their segments. Till the early 90s, Cadbury had a market share of over 80 percent, but its party was spoiled when Nestle appeared on the scene. The latter has introduced its international brands in the country (Kit Kat, Lions), and now commands approximately 15 percent market share. The Gujarat Co-operative Milk Marketing Federation (GCMMF) and Central Arecanut and Cocoa Manufactures and Processors Co-operative (CAMPCO) are the other companies operating in this segment. Competition in the segment will get keener as overseas chocolate giants Hershey's and Mars consolidate to grab a bite of the Indian chocolate pie. Per Capita Chocolate Consumption (in lb) of first 15 countries of the world Rank Countries Per Capita Consumption (in lb) Switzerland 22.36 Austria 20.13 Ireland 19.47 Germany 18.04 Norway 17.93 Denmark 17.66 United Kingdom 17.49 Belgium 13.16 Australia 12.99 Sweden 12.90 United States 11.64 France 11.38 Netherlands 10.56 Finland 10.45 Italy 6.13 INDIA, stands nowhere even near to these countries when compared in terms of Per Capita Chocolate Consumption. The Indian chocolate industry is extremely fragmented with a range of products catering to a variety of consumers. We have the bars/slabs, jellies, lollipops, toffees and sugar candies. Given India's mammoth population, it comes as a surprise that per capita chocolate consumption in the country is dismally low - a mere 20 gms per Indian. Compare this to over 7 kgs in most developed nations. However, Indians swallowed 22,000 tonnes of chocolate last year and consumption is growing at 10-12 percent annually. The market size of chocolates was estimated to be around 16,000 tonnes, valued around Rs. 4.16 billion in 1998. Volume growth which was over 20% pa in the 3 years preceding 1998, slowed down thereafter. Both chocolate and sugar confectioneries have abysmally low penetration levels, in fact, even lower than biscuits, which reach 56 per cent of the households. Market growth in the chocolate segment has hovered between 10 to 20%. In the last five years, the category has grown by 14-15% on an average and will expect it to continue growing at a similar rate in the next five years. The market presently has close to 60mn consumers and they are mainly located in the urban areas. Growth will mainly come through an increase in penetration as income levels improve. However, almost all of this consumption is in the cities, and rural India is nearly 'chocolate-free'. But the fact is that three quarters of Indians live in Rural Areas. "Average summertime temperatures reach 43 degrees Celsius in India. Chocolate melts at body temperature of 36 degrees." Per capita consumption of chocolates in India is minuscule at 20gms in India as compared to around 5-8 kgs and 8-10 kgs respectively in most European countries. ... Awareness about chocolates is very high in urban areas at over 95%. ... Growth of other lifestyle foods such as malted beverages and milk food have actually declined by 3.7 per cent and 11.7 per cent, however the CHOCOLATES continue to grow at the rate of 12.6%. Low priced unit packs, increased distribution reach and new product launches can be said to have fuelled this growth. The launch of lower-priced, smaller bars of chocolate in the last two years and positioning of chocolate as a substitute to traditional sweets during festivals, have boosted consumption. This is also because chocolate, which was considered to be an elitist food, has caught the fancy of buyers looking for a lifestyle item at affordable cost. Till recently, chocolate consumption had been restricted by low purchasing power in the market. Chocolates and other cocoa-based snack foods were looked upon as food suitable only for the well-off. After economic liberalization in 1991, major changes have occurred in food habits, partly on account of rise in gross domestic product (GDP) growth and higher purchasing power in the hands of the middle-class representing a third of the total population. Availability of chocolate products has also exploded. A study had projected that sales of the Indian chocolate industry would rise from $125/$130 million in 1998 to $175/$180 million by the year 2000 and to $450 million by the year 2005 which ACTUALLY happened irrespective of various negative factors. Per capita chocolate consumption continues to be low at about 200g per person, being mainly consumed in urban areas. In the middle and higher income groups, 70 per cent of children, 43 per cent of young adults and 16 per cent of adults consume chocolate. AC Nielsen ORG Marg report estimates the Indian Chocolate Industry' worth at Rs 2,000-crore (Rs 20 billion) Types of Chocolates Depending on what is added to (or removed from) the chocolate liquor, different flavors and varieties of chocolate are produced. Each has a different chemical make-up, the differences are not solely in the taste. 1. Unsweetened or Baking chocolate is simply cooled, hardened chocolate liquor. It is used primarily as an ingredient in recipes, or as a garnish. 2. Semi-sweet chocolate is also used primarily in recipes. It has extra cocoa butter and sugar added. Sweet cooking chocolate is basically the same, with more sugar for taste. 3. Milk chocolate is chocolate liquor with extra cocoa butter, sugar, milk and vanilla added. This is the most popular form for chocolate. It is primarily an eating chocolate. Cocoa is chocolate liquor with much of the cocoa butter removed, creating a fine powder. It can pick up moisture and odors from other products, so you should keep cocoa in a cool, dry place, tightly covered. There are several kinds of cocoa Low-fat cocoa has the most fat removed. It typically has less than ten percent cocoa butter remaining. Medium-fat cocoa has anywhere from ten to twenty-two percent cocoa butter in it. Drinking or Breakfast cocoa has over twenty-two percent left in it. This is the cocoa used in chocolate milk powders like Nestle's Quik. Dutch process cocoa is cocoa which has been specially processed to neutralize the natural acids in the chocolate. It is slightly darker and has a much different taste than regular cocoa. Decorator's chocolate or confectioner's chocolate isn't really chocolate at all, but a sort of chocolate flavored candy used for things such as covering strawberries. It was created to melt easily and harden quickly, but it isn't chocolate. Categories of Chocolates Commercial Chocolates are available in the following forms: Bars or Moulded Chocolates Counts Panned Chocolates (Gems) Éclairs Assorted Chocolates Bars or moulded chocolates (like Dairy Milk, Truffle, Amul Milk Chocolate, Nestle Premium, and Nestle Milky Bar) comprise the largest segment, accounting for 37% of the total chocolate market in volume terms. ... Wafer chocolates such as Kit-Kat and Perk also belong to this segment. Panned chocolates accounts for 10% of the total chocolate market. ... Wafer chocolates such as Kit-Kat and Perk also belong to this segment. .. Form of Consumption Pure Chocolates Toffees Cakes & Pastries Malted Beverages Wafer Biscuits & Baked Biscuits Chocolate Desserts Chocolate Manufacturing Process Workers cut the fruit of the cacao tree, or pods open and scoop out the beans. These beans are allowed to ferment and then dry. Then they are cleaned, roasted and hulled. Once the shells have been removed they are called nibs. Nibs are blended much like coffee beans, to produce different colors and flavors. Then they are ground up and the cocoa butter is released. The heat from the grinding process causes this mixture of cocoa butter and finely ground nibs to melt and form a freeflowing substance known as chocolate liquor. From there, different varieties of chocolate are produced. What is conching? Raw unprocessed chocolate is gritty, grainy and really not suitable for eating. Swiss chocolate manufacturer Rudolph Lindt discovered a process of rolling and kneading chocolate that gives it the smoother and richer quality that eating chocolate is known for today. The name 'conching' comes from the shell-like shape of the rollers used. The longer chocolate is conched, the more luxurious it will feel on your tongue. Market Size (by value & by volume) The Indian chocolate market is valued at Rs. 650 crores (i.e. Rs. 6.50 billion) a year. The Indian chocolate bazaar is estimated to be in the region of 22,000-24,000 tonnes per annum, and is valued in excess of US$ 80 million. Chocolate penetration in the country is a little over 4 percent, with India's metros proving to be the big draw clocking penetration in excess of 15 percent. Next, comes the relatively smaller cities/towns where consumption lags at about 8 percent. Chocolates are a luxury in the rural segment, which explains the mere 2 percent penetration in villages. The market presently has close to 60mn consumers and they are mainly located in the urban areas. Major Players & their Market Share The major players in the Indian Chocolate Industry are: Cadbury's India Limited Nestle India The Gujarat Co-operative Milk Marketing Federation (GCMMF) - AMUL Cocoa Manufactures and Processors Co-operative (CAMPCO) Cadbury's India Limited - A Study CADBURY'S INTERNATIONAL Cadbury is a very old trusted name. It all started in Birmingham in England when John Cadbury started his family grocery shop with side business of cocoa and chocolate products in around 1824. His two sons, Richard and George, expanded their family business of cocoa and chocolate. Bournville, a town near Birmingham, was build by them as a part of expansion of their business. Cadbury family is also known for their contribution in social reforms and considered as liberals. This family was in the forefront of adult education movement in England. CADBURY'S INDIA LIMITED Cadbury was originally incorporated as a wholly owned subsidiary of Cadbury Schweppes Overseas Ltd (CSOL) in 1948. The company's original name was Cadbury Fry (India) Ltd. In 1978, CSOL diluted its equity stake to 40% to comply with FERA guidelines. In 1982, the name was changed to Hindustan Cocoa Products. CSOL's shareholding was increased to 51% in Jan '83 through a preferential rights issue of Rs700mm. The current name was restored in Dec '89. In 2001, Cadbury Schweppes made an open offer to acquire the 49% public holding in the company. The parent holds over 90% of the equity capital after the first open offer. A second open offer has been made to buyback the balance shareholding, after which the company would operate as a 100% subsidiary of Cadbury Schweppes Plc Ever since the Cadbury is in India in 1947, Cadbury chocolates have ruled the hearts of Indians with their fabulous taste. The company today employs nearly 2000 people across India. Its one of the oldest and strongest players in the Indian confectionary industry with an estimated 68 per cent value share and 62 per cent volume share of the total chocolate market. It has exhibited continuously strong revenue growth of 34 per cent and net profit growth of 24 per cent throughout the 1990's. Cadbury is known for its exceptional capabilities in product innovation, distribution and marketing. With brands like Dairy Milk, Gems, 5 Star, Bournvita, Perk, Celebrations, Bytes, Chocki, Delite and Temptations, there is a Cadbury offering to suit all occasions and moods. Today, the company reaches millions of loyal customers through a distribution network of 5.5 lakhs outlets across the country and this number is increasing everyday.>GET ANSWER