ITC revs up food, personal care biz to boost growth
In a bid to sustain its growth momentum, ITC's packaged foods division and personal care business are putting in place strategic plans this fiscal. To drive volumes, ITC is betting big on research & product developments, distribution competencies and consumer engagement strategy to woo new consumers.
The Financial Express - 24 Jun 2013
To start with, ITC Foods, makers of `Bingo' snacks, is planning to scale up its business by drawing upon the agri-sourcing strength of the e-Choupals, in-house cuisine knowledge, product development capabilities, packaging strategy and branding, sales & distribution competencies.
On the company's strategy, Chitranjan Dar,chief executive, Foods Division, ITC, said: ''Our growth momentum will be driven by enhanced focus on innovative product development, consumer insights and improvement in product and process efficiencies as well as smart sourcing."
As part of the strategy, ITC Foods plans to invest in distributed capacities and capabilities to meet its anticipated growth. ''We feel encouraged by the increasing consumer franchise for our brands and the growth momentum will continue to be sustained this fiscal," said Dar.
In FY13, ITC Foods had to contend with high levels of input costs. Global demand-supply dynamics, policy uncertainties and adverse currency movement led to steep hike in prices of key commodities such as wheat, edible oils and packaging materials particularly during the first half of the year. "These cost pressures were, however, mitigated through a combination of improvements in product and process efficiencies, smart sourcing and supply-chain initiatives," said the company.
The Indian FMCG sector that expanded at a compounded annual growth rate (CAGR) of 17% over the last five years faces a turbulent path ahead, says Boston Consultancy Group in a report titled 'Winning the Consumer in a Multichannel World'.
In a survey of executives of leading FMCG and retail companies in India, 54% of the respondents said volatility in prices of raw materials will continue to remain a challenge for the industry, while 50% expect challenges due to rising competition over the next five years.
Industry analysts say that the personal care industry in India, however, continues to be on a long-term growth path, driven by rising disposable incomes and changing consumer preference for enhanced personal grooming.
Recognising the growth potential in this category, ITC Personal is gearing up to tap the emerging opportunities and plans to invest in the creation of cutting-edge products, flexible and responsive manufacturing and supply chain operations to drive volumes.
On ITC Personal's growth strategy, Sandeep Kaul, chief executive, Personal Care Products, said: ''Research and product envelopment expertise focused on addressing the needs of various consumer segments are being leveraged to launch innovative products and variants in soaps, shampoos and skin care categories."
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