Natural Ice Cream Case Study

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Natural Ice Cream The ice cream parlour which began as a small initiative in 1984 stands in 2006 as an entity with profitability as high as Rs 1.4 crore and with determination to double it in the subsequent financial year. Mr. R. S. Kamath is the brainchild of one of Mumbai’s best known ice cream brands – the Natural Ice cream. Since its inception the company has managed to build its equity purely through word-of-mouth.

Natural ice cream has gained the reputation as being the most sought after ice cream parlours in Mumbai especially among the young people. It enjoys a very substantial footfall at its outlets, making thus evident the facility and service orientation applied to it. Natural ice cream as a company has been registering a consistent growth over the years. R. V. Mallya, General Manager, attributes this growth partially to the changing – lifestyles, eating habits and the increasing per capita income and significantly to the quality of the products offered by the company thus enabling customers to be retained and also augmented through a good word-of-mouth.

However, although the company has a strong position it does face challenges. One in terms of continually innovating and introducing new products coupled with consistency and the other through competition from not only local players but also foreign players like Gelato, Amore etc

The questions before Management was Should Natural increase its advertising to reach out to a larger segment of the masses? Should it expand beyond the precincts of Maharashtra and Gujarat to enhance its market share?

___________________________________________________________________________ This Case is based on the project work of Rohini Anupriya, Yogesh Deora , Shubhada Ankush Jadhav and Amit Vohra, students of MBA (2008-10) batch of SVKM’s NMIMS University.

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Early history and Strategy This success story began with two unfortunate incidents; one was Kamath’s failure in the seventh grade, because of which his father stopped his education and brought him to Mumbai and the second was his split with his brother and their business venture in Mumbai – Gokul, a chain of restaurants serving ice creams, fast food and juices.

The split with his brother was in 1984 and he realized that if he had to prove himself he had to initiate a very novel idea and enterprise on it. What dawned on him was to introduce a business venture in which he had domain expertise as well as one which would be unique, and hence he decided upon making ice creams the traditional way and keeping it completely natural, devoid of artificial flavours and preservatives.

At that moment the market was dominated by industrial players, like Vadilal and Kwality and it had a loyal crowd of customers. Moving away from the artificial was his unique selling proposition. After the initial introduction of traditional ice creams he added a small treat to it, by deciding to add bits of fresh fruits to the ice creams.

Kamath had gained a lot of proficiency while with his brother, but the idea of fruits came from the fact that his father was a dealer in fresh seasonal fruits, from whom he learnt the nuances of fruit trade.

And hence the brand Natural was born.

About Natural Ice cream

In 1984 with an initial investment of just Rs 3 lacs, Kamath opened his first outlet in Juhu. This was the first business venture he embarked on all by himself, and he wanted

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to run it very cautiously. He then had only 3 as staff members and his wife assisting him then. He did not initially spend on the outlet ambience and instead let his products speak for itself. This also worked as an advantage to him as he was not under pressure to earn high returns immediately.

So armed with the basic skill of making ice cream the traditional Indian way, he started his business. It struck him that whenever Indians wanted to embellish a seasonal fruit, they often poured milk on it. He thought of doing the reverse, by...
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