ITC, the paper to hotels conglomerate, which saw its non-FMCG cigarette business revenues rise by 24 per cent in the quarter ended December 2010, has managed to turn around its foods business. The Bingo! range of potato chips saw sales growing by 48 per cent during the December 2010 quarter.
In August 2001, ITC made a modest entry into the food business with its Kitchens of India ready-to-eat preparations.The launch of Bingo in March 2007 market ITC entered into fast growing branded snack foods segment. After it entered the category with its wafer snack brand, Bingo, ITC's foray into the Rs 1,800-crore branded snack market has fetched the company a 16 per cent market share across the country and raced to No 2 spot in snack food segment across the Country (Source: AC Nielsen). The company was also quick to realise that the foods business in India requires sound knowledge of local tastes and preference. ITC wanted to provide Indian Consumer some novelty and excitement excited snacks. Hence they differentiated itself in market through its Hindustani Taste. Master Chef of ITC hotels came up to 16 flavours with twist like Spicy Masala Remix, Chatkila Nimbu Achar, Tandoori Paneer Tikka flavoured potato chips. This was totally adverse from Lays which was coming up with flavour like Spanish Tomato, American Style Cream and Onion. The new variant from Lays which are Indian flavors like Lay's Chaat Street, Mint Mischief and Wafer Style is a result of the tough competition from Bingo. ITC also came up with idea of using very famous Gujrati Khakra and created hugely successful Mad Angles.
ITC’s competitive advantage from day one has been procurement of commodities. The agri-business division of ITC connects with 5 million farmers in 170 districts of 16 states. The company leverages this to good advantage for all the commodities it requires for the food business: Wheat, sugar, edible oil, potatoes etc. Such...
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