Harpreet Project_pdf.docx

“A STUDY ON EFFECT OF BANNING MAGGI ON OTHER READY TO EAT FOODS” Project Report Submitted in partial fulfillment of the requirements for the Award of the Degree of MASTER OF BUSINESS ADMINISTRATION OF AMITY GLOBAL BUSINESS SCHOOL

BY HARPREET KAUR (Enroll. No : A30601918009) Under the guidance Prof. Surekha Thakur Faculty.

AMITY GLOBAL BUSINESS SCHOOL Punjagutta, Hyderabad. 2018 - 2020

DECLARATION

I hereby declare that Project entitled “A STUDY ON EFFECT OF BANNING MAGGI ON OTHER READY TO EAT FOODS” is the result of the project work carried out by me under the guidance of Prof. Surekha Thakur in partial fulfillment for the award of Master’s Degree in Business Administration by Amity University. I also declare that this project is the outcome of my own efforts and that it has not been submitted to any other University or Institute for the award of any other Degree or Diploma or Certificate.

Place: Hyderabad

Name

: Harpreet Kaur

Date :

Signature :

CERTIFICATE OF ORIGINALITY

This is to certify that the project report title “A STUDY ON BANNING OF MAGGI ON OTHER READY TO EAT FOODS” submitted by HARPREET KAUR to Amity Global Business School, Hyderabad for the award of degree of MASTER OF BUSINESS ADMINISTRATION is a record of work carried out by me under my faculty guidance.

Place: Hyderabad

Signature

Date :

LIST OF TABLES AND FIGURES Table. No

TITLE OF TABLES&FIGURES

Page. No

3.1

USERS OR NON USERS OF OTHER READY TO COOK PRODUCTS AGE OF RESPONDENTS

18

3.2

19

3.3

OCCUPATION OF THE RESPONDENTS

20

3.4

PERCEPTION OF USERS ABOUT THESE READY TO EAT PRODUCTS

21

3.5

PREFERENCE OF READY TO EAT FOODS AMONG FAMILY MEMEBES CUSTOMER AWARENESS ABOUT THE QUALITY OF INSTANT COOK PRODUCTS CUSTOMER AWARENESS ABOUT THE HEALTH HAZARDS OF THESE PRODUCTS CUSTOMER KNOWELEDGE ABOUT MSG,LEAD AND OTHER INGREDIENTS IN PRODUCTS FACTORS AFFECTING THE SELECTION OF READY TO EAT FOODS

22

3.10

USAGE OF SIMILAR PRODUCTS AFTER MAGGI’S BAN

27

3.11

CUSTOMER PREFERENCE ON OTHER BRANDS AFTER MAGGI’S BAN

28

3.12

CUSTOMER SATISFACTION ON SUBSTITUTED PRODUCTS

29

3.13

INFLUENCE OF BRAND AMBASSODORS IN BUYING DECION

30

3.14

MAGGI ISSUE HAS AN IMPACT ON READY TO EAT FOOD INDUSTRY

31

3.15

RECOMMENDATION OF NOODLES FOR FRIENDS AND RELATIVES NOW

32

3.16

EFFECT ON NESTLE’S PRODUCTS

33

3.17

MAGGI BAN IS A PROTECTION OF CONSUMER RIGHTS

34

3.18

REACCEPTANCE OF MAGGI

35

3.6 3.7 3.8 3.9

23 24 25 26

PAGE.

CHAPTER. NO CONTENTS INTRODUCTION 1 •

BRIEF INTRODUCTION

NO

•

NEED FOR THE STUDY

•

STATEMENT OF THE PROBLEM

•

OBJECTIVE OF THE STUDY

•

SCOPE OF THE STUDY

•

LIMITATIONS OF THE STUDY

•

METHODOLOGY OF THE STUDY

•

OPERATIONAL DEFINITIONS OF THE TERMS USED

2

REVIEW OF LITERATURE

3

DATA ANALYSIS & INTERPRETATION 4.1 SUMMARY OF FINDINGS

4

4.2 CONCLUSION 4.3 SUGGESTIONS AND RECOMMENDATION 5.1 EXPERIENCE AND LEARNING

5 5.2 WORK DONE DIARY APPENDICES BIBLIOGRAPHY

TABLE OF CONTENTS

CHAPTER 1 INTRODUCTION

1.1 BRIEF INTRODUCTION FAST FOOD INDUSTRY IN INDIA The fast food industry in India has evolved with the changing lifestyles of the young Indian population. The sheer variety of gastronomic preferences across the regions, hereditary or acquired, has brought about different modules across the country. It may take some time for the local enterprise to mature to the level of international players in the field. Many of the traditional dishes have been adapted to suit the emerging fast food outlets. The basic adaptation is to decrease the processing and serving time. For example, the typical meal which called for being served by an ever alert attendant is now offered as a Mini-Meal across the counter. In its traditional version, a plate or a banana leaf was first laid down on the floor or

table. Several helpers then waited on the diner, doling out different dishes and refilling as they got over in the plate. In the fast food version, a plate already arranged with a variety of cooked vegetables and curries along with a fixed quantity of rice and Indian flatbreads is handed out across the counter against a prepaid coupon. The curries and breads vary depending on the region and local preferences. The higher priced ones may add a sweet to the combination. Refills are generally not offered. The diversity of Indian cuisine poses logistical problems when it comes to handling. Hence it is common to serve different cuisines at different counters within the same premises. Presence of a large vegetarian population, who eschew non-vegetarian food, has given rise to outlets which exclusively serve vegetarian fast food. Also, different variety of food may be served depending on the times of the day. Beverages such coffee, tea, soft drinks and fruit juices may also be served in such outlets. Some outlets may additionally have specially designed counters for icecream, chats etc. Popular formats of fast food business in India have the following features in common: •

Wide opening on the road side

•

Easy to maintain and durable décor

•

A cash counter where food coupons are sold

•

A food delivery counter which invariably is granite topped

•

Additional counters for Ice Creams, Chats, and Beverages etc.

•

A well fitted kitchen located so as to be visible to the customers

•

Tall tables, usually of stainless steel, where one can eat while standing

•

A drinking water fountain adorned with a water filter

•

Rust-proof and non-breakable crockery

Most of the fast food outlets in India are stand alone establishment, few of them having more than one branch GLOBAL NOODLE MARKET

Instant noodles have become one of the world's most popular food items owing to their versatility and convenience. This product is one of the first ready-to-eat foods launched widely in the global food industry and now it has successfully become an important part of modern food consumption. The major trends observed in the global instant noodles market are product innovation; focus on nutritional value of product and instant marketing of instant noodles. Disposable income and purchasing power parity of consumers in various regions across the globe represent major economic factors that influence the demand, and consumption for instant noodles. Typically, consumers with higher disposable income consume higher amounts of instant noodles. Indonesians spend more than 70 percent of their disposable income on instant noodle products, trailed by Chinese consumers, who spend about 56 percent of their income. South Korean consumers spend 33.2 percent, closely followed by Thai consumers with 30 percent. Mexicans and Indians, on the other hand, spend a very small percentage of their incomes on instant noodles partially due to the purchasing power parity and partially due to a vast difference in culinary cultures. Unlike in other parts of the world, an instant noodle is a mainstream food category in AsiaPacific. The region, led by relentless demand from the Chinese and Hong Kong markets, is portended to continue its dominance over the coming years. Emerging over the Asian horizon is China that is recording massive production and consumption figures. With relatively low annual per capita consumption levels compared to other Asian counterparts, China represents a potential market for instant noodles. Instant noodles in Middle East/Africa are experiencing a growth in the demand, with the introduction of newer products into the market and are poised to grow at a strong compounded annual growth rate over the long-term. Major players profiled in the world market include Acecook Vietnam Co., Ltd., Ajinomoto Company Inc., Blue Dragon, CJ Corporation, HJ Heinz Co., Ltd., Kohlico, MAMEE-Double Decker (M) Berhad, Nestlé India Ltd., New Dragon Asia Corp., Nissin Food Products Co., Ltd., Nong Shim Co., Ltd., Pt. Indofood Sukses Makmur TBK, Samyang Foods Co., Ltd., Sco-Fro Foods Ltd., Tat Hui Foods Pte Ltd., Thai President Foods Public Company Limited, Tingyi (Cayman Islands) Holding Corp., Toyo Suisan Kaisha, Ltd., and Uni-President Enterprises Corp. NOODLE MARKET IN INDIA

Due to fast cooking properties, instant noodles today have occupied an important position in almost every Indian kitchen. Since most of the women in urban India are working, instant noodles and ready-to-eat foods are slowly and steadily replacing the traditional rice and pulses. Modern formats, which provide high product visibility and good product displays, are acting as a good marketing platform for brands to promote their product offerings via consumer schemes like price discounts, bundled offers, sampling for new launches, etc. Trends in Indian Noodle Market •

Increasing competition: Competition in instant noodle category has intensified with players such as GlaxoSmithKline (Horlicks Foodles), ITC (Sunfeast Yippee noodles), Capital Foods and Hindustan Unilever launching new products in the market.Private label brands such as Tasty Treat by Future Group (Big Baazar retail chain) have also been launched an it is expected that many more private label brands may hit the market.

•

New product launches and extensive marketing: All players new or old have been busy launching new products and marketing campaigns. Maggi has launched an extensive campaign with their new product vegetable multigrain noodle. Tasty Treat increased its variants from two to five. Similarly, Foodles is stressing on the health aspect of its products.

Stress on health and wellness: As on all other food categories, players are stressing on health and wellness aspects of their products. Maggi launched Atta noodles and multigrain noodles to weak customers while Glaxo’s Foodles also stresses on the multigrain aspect of their product •

Traditional flavors still dominate: Masala, chicken and tomato are most popular flavors in the market

•

Addressing rural market: Noodles are primarily consumed in urban India and to expand this market companies such as Nestle have introduced small sized and low cost products to address the demand of rural market. The success of this effort is still to be seen

Key Players in Indian Noodle Market The instant noodle market is dominated by MNCs; very few local players have a sizeable presence. Some of the key players in the market along with their brands are: •

Nestle (Maggi)

•

Hindustan Unilever (Knorr Soupy Noodles)

•

GlaxoSmithKline Consumer Healthcare (Foodles)

•

Capital Foods Ltd. (Ching's Secret)

•

ITC (Sunfeast Yippee noodles)

•

CG Foods India Pvt. Ltd.(wai wai)

•

Future Group (tasty Treat)

Opportunities in Indian Noodle Market •

Health and wellness theme: Health and wellness theme based packaged food is gaining popularity in India and the market of such noodles is still open as traditional player Maggi is not associated with “health” but with convenience and taste.

2

Huge Rural market: rural India where close to 60% of Indian population resides is a huge consumption market virtually un-penetrated by any player. Low cost products with appropriate marketing can open up this huge market.

The following table shows India’s noodle consumption in the last 5 years. YEAR

2010

2011

2012

2013

2014

CONSUMPTION (TONNES)

2940

3530

4360

4980

5340

MAGGI BRAND IN INDIA Maggi is an international brand of seasonings, instant soups, ketch ups and noodles owned by Nestle since 1947. The original company was founded in Switzerland in 1872 by Julius Maggi. The original company came into existence in 1875 in Switzerland when Julius Maggi took over his father's mill. He quickly became a pioneer of industrial food production, aiming to improve the nutritional intake of worker families. Maggi was the first to bring proteinrich legume meal to the market, and followed up with a ready-made soup based on legume meal in 1886. In 1897, Julius Maggi founded the company Maggi GmbH in the German town of Singen, where it is still based today.

In 1947, following several changes in ownership and corporate structure, Maggi's holding company merged with the Nestle Company to form Nestle - Alimentana S A, currently known in its francophone home base as Nestle S.A. The Nestle India which is subsidiary of Nestle S A introduced Maggi brand in India 1982, with its launch of 2 Minute Noodles, an instant noodles product. With the introduction of Maggi 2 Minute noodles Nestle India created an entirely new food category – instant foods in Indian packaged food market. Because of its first-mover advantage Nestle India successfully retained to manage its leadership in noodles category. Nestle India offered a variety of products such as instant noodles, soups, sauces, and ketch ups, cooking aids, etc…under the Maggi brand. Out of these instant noodles were Nestle’s main products which contributing around 20% of the company revenue. During 1990s the sales of Maggi noodles declined, and this was attributed partly to the growing popularity of Top Ramen, another instant noodles product. In order to increase sales and attract customers Nestle India changed the formulation of Maggi noodles in 1997.That was unsuccessful, customers did not like the taste of new noodles. In 1999 Nestle reintroduced the old formulation of the noodles, after the sales revived. Over the years Nestle introduced several other products like soups and cooking aids under the Maggi brand. However these products were not as successful as the instant noodles. In 2000 the company set up new research and development facilities with a view to improving the attributes of the existing Nestle products. In 2005 they introduced Vegetable Atta Noodles in the market. Up to mid of 2015 Maggi was synonymous with instant noodles and had an 80% share in Indian noodles market. In the mid of 2015 the Food Safety and Standard Authority of India (FSSAI) found that Maggi Noodles has Monosodium glutamate, and Lead beyond the permissible amount. The central government of India banned Maggi in Indian markets. The following diagram shows the position of Maggi in Indian noodle market and other ready to eat food products market.

Various Varieties of Maggi Noodles in Indian Market Maggi 2- Minute Noodles

It is one of the largest and most loved food brands that defines instant noodles in india.This Maggi noodles is available in 4 delectable flavors - Masala, Chicken, Tomato and Curry Maggi Vegetable Atta Noodles Maggi atta noodles are introduced mainly for vegetarians. It was filled with real vegetables and offering with masala flavor. Maggi Cuppa Mania Maggi cuppa mania was a mixture of above two variants.Maggi cuppa mania comes in two mouth watering variants, masala, real vegitables and calcium. COMPETATORS OF MAGGI NOODLES IN INDIAN MARKETS •

ITC Sunfeast Yippee

Another popular noodle brand in India is Sunfeast Yippee, which belongs to the Indian conglomerate ITC. Yippee made its way into the Indian market in the first decade of the 2000s and gradually made a considerable presence. By the early 2010s, Yippee had started giving market leader Maggi some sort of competition. Yippee noodles are available in five different variants; namely, •

Classic Masala,

•

Magic Masala,

•

Chinese Masala,

•

Tricolor Pasta (Creamy Corn) and

•

Tricolor Pasta (Masala).

•

Top Ramen

Top Ramen, by Nissin, is another leading noodle brand in India. Nissin is a Japanese company that introduced its first noodle product in 1958 but entered the Indian market 30 years later in 1988. It took a while for Top Ramen to become one of the leading noodle brands in India. Different variants of Top Ramen noodles in India include •

Atta Noodles,

•

Cup Noodles,

•

Curry Veg Noodles,

•

Oats Noodles,

•

Scoopies Short Noodles and

•

Super Noodles.

•

Ching's Secret

Ching's Secret is another popular noodle brand in India. It is a product of Capital Food Indian Limited. Another popular brand of noodles in India produced by Capital Food India Limited is Smith & Jones. But Ching's Secret is the more popular one and is giving stiff competition to the top noodle brands in India. Ching's Secret offers a vast range of products to its customers that include •

Schezwan Instant Noodles,

•

Singapore Curry Instant Noodles,

•

Hot Garlic Instant Noodles,

•

Egg Hakka Noodles and

•

Veg Hakka Noodles.

•

Knorr Soupy Noodles

Knorr Soupy Noodles is a product of Hindustan Unilever and has turned out to be a popular brand in India of late. Knorr is famous for its unique range of soups in India and is the leading brand for the same but has earned accolades for its unique combination of noodles and soup, that is, Knorr Soupy Noodles. Knorr noodles range consists of

•

•

Mast Masala Soupy Noodles,

•

Knorr Chinese Noodle Hot Spicy,

•

Knorr Chinese Noodle Schezwan,

•

Chinese Noodles and

•

Fried Rice.

Glaxo Smithkline Horlicks – Foodles

GlaxoSmithKline (GSK) is a British multinational pharmaceutical, biologics, vaccines and consumer healthcare company headquartered in London, United Kingdom. In 2009, GSK launched Foodles under its brand name Horlicks.Foodles gives the taste of instant noodle with the goodness of Wheat, Ragi, Rice, and Corn. Ala masala variant contains Wheat 75%, Rice 1.2%, Corn 1.2%, Ragi 1.2%, Edible vegetable oil, minerals and salt. GlaxoSmithKline Consumer Healthcare has launched– ‘Foodles’ from Horlicks. These instant noodles feature a Health maker™, which is fortified with 9 vital nutrients and is packed with the goodness of iron and calcium. Foodles from Horlicks is available in two options- Regular and Four-Grain. The four-Grain Variant is made with nutritious grains-rice, corn, rag and wheat, said a press release. The company launched its noodles under the popular Horlicks brand named ‘Foodles’ in the year 2009. •

Regular

•

Ala Masala

•

Curry in Hurry

•

Slice of Spice

•

Multi Grain

THE MAGGI PROBLEM In May 2015, Food Safety Regulators from Uttar Pradesh, India found that samples of Maggi 2 Minute Noodles had unexpectedly high levels of monosodium glutamate, as well as up to 17 times the permissible limit of lead. On 3 June 2015, the New Delhi Government banned the sale of Maggi in New Delhi stores for 15 days due to these findings. On June 4, 2015, the Gujarat FDA banned the noodles for 30 days after 27 out of 39 samples were detected with objectionable levels of metallic lead, among other things. Assam had banned sale, distribution and storage of Maggi's "extra delicious chicken noodles" variety for 30 days since June 4, 2015 after tests carried out at the state public health laboratory concluded the particular variety to contain added MSG and excessively high lead content. Some of India's biggest retailers like Future Group which includes Big Bazaar, Easyday and Nilgiris have imposed a nationwide ban on Maggi. Thereafter multiple state authorities in India found an unacceptable amount of lead and it has been banned in more than 5 other states in India. On June 4, 2015 the government of Tamil Nadu also banned maggi due to unacceptable amount of lead and other components. On June 5th the Andhra Pradesh Government Banned Maggi. Maggi will not be banned in Karnataka for now, declared minister for health and family welfare U T Khader during a press meet on June 26. On June 5, 2015, Food Safety and Standards Authority of India (FSSAI) ordered a recall of all nine approved variants of Maggi instant noodles and oats masala noodles from India, suggesting them unsafe and hazardous for human consumption. On the same day, Food Safety Agency of United Kingdom launched an investigation to find levels of lead in Maggi noodles. On June 6, 2015 the Central Government of India banned nationwide sale of Maggi noodles for an indefinite period. Nepal indefinitely banned Maggi over concerns about lead levels in the product. Maggi noodles has been withdrawn in five African nations- Kenya, Uganda, Tanzania, Rwanda and South Sudan by a super-market chain after a complaint by the Consumer Federation of Kenya.

It was revealed later that the United States Food and Drug Administration (FDA) had refused import of the noodles in January 2015 on grounds similar to the reasons for ban in India. Ironically, the Bombay High Court allowed the export of Maggi while the ban in India remained. FIRs against Bollywood Maggi Brand Ambassadors Amitabh Bachchan, Madhuri Dixit & Preity Zinta were lodged at a local court, asking the authorities to arrest them if required.

1.2 NEED FOR THE STUDY •

The customers were interested to find out the best ready to cook products in the present market.

•

The company was interested to know the current market trends of the instant foods.

•

The customers were interested to know about the health hazards and dangerous ingredients of the instant foods.

1.3 STATEMENT OF THE PROBLEM The Indian fast food industry was a growing industry until the ban of Maggi noodles. This is a descriptive study about the impact of Maggi banning in Indian ready to cook food products. India’s market for processed, packaged, and branded foods is a nascent one where consumers are largely unaware of the ingredients, addictives and other attributes of what they buy and eat., even though they decide the future of each product. So I took 150 customers as sample. The ready to cook market is wider market in India. Maggi was the major market share holder in Indian ready to eat food market with their noodles and other instant foods. Maggi noodles account for 20% of Nestle Company’s overall revenue. Large numbers of players are there. So it is difficult to reach millions of customers and large number of players. Maggi problem has made certain confusions in the market about the genuineness of these products. So I am trying to make a brief study on the effect of Maggi ban on other ready to cook products and its remedial solutions.

1.4 OBJECTIVES OF THE STUDY • To find out the impact of magi banning on similar food products.

• To find out the demand variances of ready to cook food products after maggi issue • To understand the behavioral change of customers towards fast-food • To determine the knowledge base of consumers about the fast-food culture 1.5 SCOPE OF THE STUDY •

The present study will aim at studying, the influence of maggi banning on other ready to eat foods.

•

The study helps the company to prepare a definite brand positioning and market penetration policies.

•

The study helps the company to find out present customer attitudes.

•

The study helps to get an idea about the latest market share of each company.

•

The study helps company to meet the customer queries doubts by introducing proper customer relation techniques.

1.6 LIMITATIONS OF THE STUDY Through adequate care has been taken while doing the project. This project still

suffers from

certain limitations. They are; It is a wider topic. It may have different dimensions. However, it is possible that there will be other factors, which might not have been covered in this study. •

Some respondents did not properly respond to the questionnaire.

•

The results and conclusions of the project cannot be generalized in all area of an organization.

•

There was shortage of time and resources for the functioning of operation.

1.7 METHODOLOGY OF THE STUDY

Two techniques were used for collecting data, namely; •

Primary data collection technique

•

Secondary data collection technique

PRIMARY DATA Primary data are collected afresh and for the first time. It is the data originated by the researcher specifically to address the research problem. In this study, the primary data are collected from the general public regarding their views towards ready to cook products through questionnaire.

SECONDARY DATA This will include data collection from various websites, books, Company brochures, magazines, articles as a support to primary.

1.8 OPERATIONAL DEFINITIONS OF THE TREMS USED MSG – Monosodium glutamate is the sodium salt of glutamic acid, one of the most abundant naturally –occurring non-essential amino acids.MSG is found in tomatoes, parmesan cheese, potatoes, mushrooms, and other vegetables and fruits. LEAD – Lead is present in small amounts throughout the environment due to its natural occurrence and its release into the environment by human activities. Exposure of large amount of lead whether from food or any other source, can affect numerous body systems including the central nervous system the kidneys and the immune system. FSSAI – The Food Safety and Standards Authority of India is an agency of the Ministry of Health and Family Welfare, Government of India. The FSSAI is responsible for protecting and promoting public health through the regulation and supervision of food safety.

CHAPTER 2

REVIEW OF LITERATURE

2.1 REVIEW OF LITERATURE Maggi was the leading brand in Indian market; the company had a definite market leadership in the market. The promotional strategy and other marketing techniques of Maggi lead them to this leadership. But now a day the Maggi is facing a serious problem which questioning the future of the Maggi brands itself. The government of India banned Maggi noodles in Indian market due to excess content of MSG and LEAD.FSSAI has ordered recall of all variants of Maggi noodles from the market, terming them unsafe and hazardous for human consumption. This is the current market problem facing in the industry the researches and experiments are happening on this subject so there are no much more journals or articles relating to this topic. Below I am trying to review some articles from different journals.

•

BRITISH FOOD JOURNAL, "Critical issues in packaged food business", VOL. 107, AZIZ AHMED, NASER AHMED, AHMED SALMAN, (2005)

“The key trends fostering growth in developed packaged food markets are convenience, functionality and indulgence. The real value of packaging is that the package is an integral part of the product today. Besides, food products frequently require the general marketing approaches and techniques applied to the marketing of other kinds of products and services. Moreover, while going for product innovation, some critical success factors must be taken into account. Furthermore, the objective of all quality assurance systems exercised by food manufacturers and processors is to produce safe products that comply with manufacturers' specifications, including the requirements established by governments. On top of that, the companies that are the most progressive in the management of the supply chain are expected to be the most successful and profitable. Last, but not least, companies should look forward to emerging trends for business

success. All these critical issues must be observed in a packaged food business for superior performance” The exterior look or packet of a product plays a vital role in attracting customer attention, so the companies doing packed food business should give proper care on this matter.

•

THE WALLSTREET JOURNALS, “Healthy Food Looks Serious: How Children Interpret Packaged Food Products”, VOL. 34, CHARLENE D. ELLIOTT, (2009). “Fun food is an overlooked, but increasingly significant, category of food targeted to

children in the supermarket. These supermarket products emphasize foods’ play factor, interactivity, artificiality, and general distance from “regular” foods: food is positioned as “fun” and eating as “entertainment”. The children are highly attuned to fun foods and its packaging, offering savvy, if flawed, interpretations of how to determine the healthfulness of a packaged good. I argue that the symbolic positioning of children’s food as fun and fake creates several roadblocks in the quest to promote wholesome food habits in children, and that the thematic of fun has unintended consequences that require careful consideration.” The children mostly prefer this kind of packed food. They are not aware about the quality of these products but attracted in the packing taste etc…

•

JOURNAL OF FOOD PRODUCTS MARKETING, “Public Health Nutrition”, VOL.21, Dr WILMA WATER LANDER, (3, 2015)

“The lack of significant price difference between ultra- and less processed foods suggests ultra-processed foods might provide time-poor consumers with more value for money. The majority of packaged food available in New Zealand supermarkets is ultra-processed and so also the unhealthiest. Most of the products were varieties of the same product. For example 311 breakfast cereal products were available, of which 92 (29.6 percent) were produced by two food manufacturers, Ozone Organics and Kellogg’s. These findings highlight the need to improve the

supermarket food supply by reducing numbers of ultra-processed foods and reformulating products to improve their nutritional profile” This is an article about the global market there are two types of processed food ultra processed and less processed foods.Ultra processed food are less healthier than less processed food.so we need to go forward with less processed packed foods.

•

ZENITH INTERNATIONAL JOURNAL OF BUSINESS ECONOMICS & MANAGEMENT RESEARCH, “Rural consumer’s perception towards branded packaged food”, VOL.4 (5), DR. VIJAYUDU GNANAMKONDA (Assistant Professor, ICFAI Business School, Dontanapally, Shankarapally Road, Hyderabad), MAY (2014) “The Packaged Food Market in India is a sunrise industry as growth in this sector in the

recent past has been phenomenal. Many new entrants are playing a vital role to harness ever increasing market potential. Most new food companies, as well as the existing companies, are in the process of entering into the rural market. With about 70% of total population and increase in disposable income, rural markets are being liked on as the future avenues for business growth. However food companies need to devise new and innovative marketing strategies to penetrate rural markets” India has wide rural market. The packed food industries are focusing to penetrate the rural markets.

•

BRITISH FOOD JOURNAL, “The Multi-Faceted Dimension Of Packaging: Marketing Logistic Or Marketing tool?”, VOL. 107,BO RUNDH, (2005) “Packages attract consumers attention to particular brand, enhance its image, and

influences consumers perceptions about product. Intermediaries of the package communication message are component of the package: colour, form, size, images, graphics, material, smell, and name of the product, brand, and country, information about product, special offers, and

instructions of usage, simplicity and ecology of the package, ergonomics, and innovativeness. All these elements of the package play the function of communication. Their transferable messages involve the evaluation of the product in qualitative, quantitative, price, view, the formation of the product cognitive and sensorial expectations, the impact to consumer emotions, mood and attention”. Packet is a media of advertisement. The company should give all relevant data about the product on packet it is a way of transferring messages about the product quality and other specific details.

•

JOURNAL OF FOOD PRODUCTS MARKETING , “Indian Consumer’s Perception For Packaged Food And The Strategies Of Food And Grocery Retailers In India-An Analysis”, VOL. 21 , SANJAY KUMAR, (2014) “Indian consumers buying decisions about the packaged food is a changing one based on

the income level and demand level of customers. It is very difficult to reach everywhere in Indian market because of the demographic variants. Retailer’s marketing strategies and promotional activities will affect the packed food market”. Indian consumers buying decision is based on the various factors like income level, demand, and retailer strategies etc…and the demographic structure of India limits company’s access of rural markets. •

THE WALLSTREET JOURNALS, “Nestle Recalls Maggi Noodles in India amid Food Scare”, PREETIKA RANA, (JUNE 5, 2015). “India, the world’s largest democracy, can be a challenge for high-profile global brands.

In 2003, Coca-Cola Co.’s quarterly sales in India fell 11% after activist groups alleged that some of its soft drinks contained high levels of pesticides and insecticides. The company denied the allegations and responded with its own aggressive marketing campaign. The noodle recall in India comes at a tough time HYPERLINK "http://www.wsj.com/articles/nestle-continues-toslim-to-compete-with-new-food-industry-giants-1429196176" for Nestlé. In 2014, the Vevey, Switzerland-based company recorded its HYPERLINK "http://www.wsj.com/articles/nestlereports-slowest-annual-growth-since-2009-1424327730"slowest sales growth HYPERLINK

"http://www.wsj.com/articles/nestle-reports-slowest-annual-growth-since-2009-1424327730" in five years as it wrestled with changing consumer tastes in Europe and slower growth in China, its second largest market Like other food companies, the maker of Nescafé instant coffee and KitKat chocolate bars has been looking to developing economies like India for growth as demand softens in more-established markets. In developed economies, sales of packaged food have been hit by low consumer confidence as well as a shift toward fresh foods and other supposedly healthier alternatives. In the U.S., for example, consumers increasingly shun processed foods” The packed food industries considering Indian market and other developing country’s market as a safe market, because the consumption rate showing increases every year. The trend in developed countries are changing the people starting shun processed foods.

•

NATIONAL JOURNAL OF COMMUNITY MEDICINE ,”A Study On Consumer Awareness, Safety Perceptions &Practices About Food Preservatives And Flavoring Agents Used In Packed /Canned Foods From South India”, VOL. 4, KUMAR, H N HARSHA JHA, ANSHU KUMAR, TANEJA,( July 2013). “The

increasing use of preservatives and flavoring agents has the potential to cause health

problem among the people. There are no published studies from India exploring the awareness, safety perception, & practices about Food Preservatives (FPs) and Flavoring Agents (FAs). Though there was awareness, the knowledge was inadequate. Unfavorable practices were observed. The gaps in the knowledge and unhealthy practices need to be addressed by public awareness campaign.” The Indian customers are not aware about the ingredients about the products they are using. There has no detailed studies happening in this area.

•

ASIAN SOCIAL SCIENCE, “Indian Consumer Purchasing Behavior towards Branded Processed Food”, VOL. 10,M. VIJAYA BASKAR1 & N. SUNDARAM ,(May 30, 2014). “The consumer purchase brands mostly on the parameters of trust and safety. These two

parameters build long term association with the brands. Even though there are other factors people considers while choosing brands, trust and safety are become the vital parameters to purchase brands. Brand endorsements, brand ethical concerns, brand attributes are have little impact on purchase intention” The consumers buying branded products because of safety and trust. They trust in the quality of the branded products. So the customers are not willing to leave their brand until he gets any negative from the side of their favorite brands.

CHAPTER 3 DATA ANALYSIS AND INTERPRETATION

3.1 DATA ANALYSIS AND INTERPRETATION USERS OR NON USERS OF MAGGI OR OTHER READY TO EAT FOOD PRODUCTS

S.NO

USERS OR NON USERS OF NO OF RESPONDENTS MAGGI OR AOTHER NOODLES

PERCENTAGE

1

USERS

102

68

2

NON- USERS

48

32

150

100

Total TABLE 3.1

FIGURE 3.1

ANALYSIS AND INTERPRETATION Above table and graph shows that out of 150 respondents, only 102 are using any kind of noodles or ready to cook products, that is 68%.Remaining 32% respondents not used any kind of ready to cook products. So these 102 respondents are the base for further analysis. AGE OF RESPONDENTS S. NO

AGE

NO.OF RESPONDENTS

1

Less than 14

36

35.3

2

15 – 30

48

47.1

3

30 above

18

17.6

102

100

Total

PERCENTAGE

TABLE: 3.2

FIGURE 3.2 ANALYSIS AND INTERPRETATION From the above table it is clear that 35.3% of the respondents have less than 14 years, 47.1% of the respondents are aged between 15-30 years and 17.6% of respondents are aged above 30 year.

OCCUPATION OF THE RESPODENTS S.NO

OCCUPATION

NO.OF RESPONDENTS

PERCENTAGE

1

Salaried employees

45

44.1

2

Students

35

34.3

3

Agriculturists

10

9.8

4

Others Total

12

11.8

102

100

TABLE 3.3

FIGURE 3.3 ANALYSIS AND INTERPRETATION From the above Table it is clear that 44.1% of the respondents are salaried employees, 34.3% of respondents are Students, 9.8% of respondents are agriculturists and 11.8% of respondents are belongs to other category

S.NO

PERCEPTION

1

Good for health Ready to eat

NO.OF RESPONDENTS

2 3

Junk food Tasty/Fun eating

4

food Total

PERCENTAGE

35

34.3

50

49

7

6.9

10

9.8

102

100

PERCEPTION OF USERS ABOUT THESE READY TO EAT FOOD PRODUCTS TABLE 3.4

FIGURE 3.4 ANALYSIS AND INTERPRETATION

From the table it is clear that 49% of the users cosuming these products because it is ready to eat.34.3% beleves that it is a nutritious food so it is good for health.9.8% using it because of its taste and for fun. 6.9% of respondents using it as a junk food.

PREFERENCE OF READY TO EAT FOODS AMONG FAMILY MEMEBES SL. NO

RESPONSE

NO OF RESPONDENT

PERCENTAGE

1

CHILDREN

68

66.7

2

SPOUSE

15

14.7

3

PARENTS

5

4.9

4

OTHERS

14

13.7

102

100%

TOTAL TABLE 3.5

FIGURE 3.5 ANALYSIS AND INTERPRETATION Above table shows that childrens are prefering (66.7%) ready to eat products mostly in homes.The husband or wife prefering ready to eat products secondly(14.7%) because the working women number is increasing in india.and the other category holds third position in homes( 13.7%).

CUSTOMER AWARENESS ABOUT THE QUALITY OF INSTANT COOK FOOD PRODUCTS S.NO

AWARENESS

NO.OF RESPONDENTS

1

YES

37

36.3

2

NO

65

63.7

102

100

Total

PERCENTAGE

TABLE.3.6

FIGURE 3.6 ANALYSIS AND INTERPRETATION The table shows that 63.7% of respondents are unaware about the quality of these ready to cook products.They are using it is because these foods are convenient.Only 36.3% of respondents are considering the quality while buying these products. CUSTOMER

AWARENESS

ABOUT

THE

HEALTH

HAZARDS

OF

THESE

PRODUCTS S.NO

AWARENESS

NO.OF RESPONDENTS

1

YES

60

58.8

2

NO

35

34.3

3

LITTLE

7

6.9

102

100

Total

TABLE 3.7

PERCENTAGE

FIGURE 3.7 ANALYSIS AND INTERPRETATION The above table shows that 58.8% respondents know these foods make health hazards even though they are using the same products.34.4 %respondents are not awre about the prolems of this instant foods.6.9% respondents know littile about the health hazards but they don’t take it as serious. S.NO

OPINION

NO.OF RESPONDENTS

1

YES

38

37.3

2

NO

64

62.7

102

100

Total

PERCENTAGE

CUSTOMER KNOWELEDGE ABOUT MSG,LEAD AND OTHER INGREDIENTS IN PRODUCTS TABLE 3.8

FIGURE 3.8 ANALYSIS AND INTERPRETATION Above table shows that 62.7% customers don’t have any knowledge about the MSG.LEAD.and other ingredients in these instant foods.37.3% are aware about this ingredients but they are knowingly buying these products. FACTORS AFFECTING THE SELECTION OF READY TO EAT FOODS

S.NO

OPINION By watching 1

NO.OF RESPONDENTS

PERCENTAGE

46

45

19

18.7

37

36.3

102

100

advertisements Recommendations from

2

friends and relatives By checking product

3

quality Total TABLE 3.9

FIGURE 3.9 ANALYSIS AND INTERPRETATION Above table reveals that 45% of respondents buying these instant cook products by watching advertisement while 36% buying it by checking the product quality.The rest 19% buying it as per the recommendations of their friends and relatives. USAGE OF SIMILAR PRODUCTS AFTER MAGGI’S BAN S.NO

OPINION

NO.OF RESPONDENTS

1

YES

25

24.5

2

NO

77

75.5

102

100

Total

TABLE 3.10

PERCENTAGE

FIGURE 3.10 ANALYSIS AND INTERPRETATION Above table shows that after maggi’s ban majority (75.5%) not used any kind of these food products.I think it is because of fear.24.5% continued their usage of noodles on similar brands,after Maggi’s ban.

CUSTOMER PREFERENCE ON OTHER BRANDS AFTER MAGGI’S BAN S.NO

PREFERENCE

NO.OF RESPONDENTS

PERCENTAGE

1

SUNFEAST YIPPEE

15

60

2

HORLICKS FOODLES

5

20

3

CHING’S NOODLES

5

20

4

OTHERS

0

0

25

100

Total TABLE 3.11

FIGURE 3.11 ANALYSIS AND INTERPRETATION After maggi’s ban only 24.5% users substituted the company.out of that people majority choosed sunfeast yeppie noodles.Balance customers choosed both horlicks foodles and ching’s noodles equally.

CUSTOMER SATISFACTION ON SUBSTITUTED PRODUCTS S.NO

SUBSTITUTE

NO.OF RESPONDENTS

PERCENTAGE

1

SUNFEAST YIPPEE

13

52

2

HORLICKS FOODLES

12

48

3

CHING’S NOODLES

0

0

4

OTHERS

0

0

25

100

Total TABLE 3.12

FIGURE 3.12 ANALYSIS AND INTERPRETATION Above table shows that 52% of respondents are satisfied on Sunfeast Yeppie noodles and 48% of customers are satisfied on Horlicks foodles.Yeppie and foodles got benefit from the ban of Maggi.Other brands didn’t make any influence on customers. INFLUENCE OF BRAND AMBASSODORS IN BUYING DECION S. NO

OPINION

NO OF RESPONDENTS

PERCENTAGE

1

YES

77

75.4

2

NO

25

24.5

Total

102

100%

TABLE 3.13

FIGURE 3.13 ANALYSIS AND INTERPRETATION From the above table 75.4% believes that brand ambassodors will influence the buying decision of consumers,they are considering these products because of the stars appearing in the advertisement of these products,but 24.5% of respondents argues that brand ambasodors don’t have any influence on their buying decision,they are considering the quality rather than promotional techniques. MAGGI ISSUE HAS AN IMPACT ON READY TO EAT FOOD INDUSTRY S. NO

OPINION

NO OF RESPONDENTS

1

YES

76

74

2

NO

26

26

102

100%

Total TABLE 3.14

FIGURE 3.14

PERCENTAGE

ANALYSIS AND INTERPRETATION From the given table and graph 74% of respondents believes that maggi issue has an impact on the ready to eat products industry because now they are checking the ingredients before buying a product and 26% arguing that it has no impact on the market.These 26% are not aware about the present market scenario. RECOMMENDATION OF NOODLES FOR FRIENDS AND RELATIVES NOW S. NO

OPINION

NO OF RESPONDENT

PERCENTAGE

1

YES

29

28.5

2

NO

73

71.5

102

100%

Total TABLE 3.15

FIGURE 3.15 ANALYSIS AND INTERPRETATION From the above table we can undestand that 71.5% of respodents now will not recommend noodles for their friends and relatives after Maggi’s issue and 28.5% will recommend for their friends and relatives now.

EFFECT ON NESTLE’S PRODUCTS

S. NO

OPINION

NO OF RESPONDENT

PERCENTAGE

1

YES

58

56.8

2

NO

44

43.2

102

100%

Total TABLE.3.16

FIGURE 3.16 ANALYSIS AND INTERPRETATION Above table shows that 56.8% respondents believes that the maggi issue has affected the Nestle’s products,they are now watching other products of Nestle doubtfully.43.2% respondents saying that no affect on Nestle’s products.

MAGGI BAN IS A PROTECTION OF CONSUMER RIGHTS S. NO

OPINION

NO OF RESPONDENT

PERCENTAGE

1

YES

82

80.4

2

NO

20

19.6

102

100%

Total

TABLE 3.17

FIGURE 3.17 ANALYSIS AND INTERPRETATION Above table shows that 80.4% believes that Maggi’s ban is the protection of consumer rights.They think that through the intervention of FSSAI in ready to eat food market will help to maintain quality measures and other regulatoryactivities,19.6% believes that it is not protection of consumer rights but it is interference to the business rights. REACCEPTANCE OF MAGGI S. NO

OPINION

NO OF RESPONDENT PERCENTAGE

1

YES

43

42.2

2

NO

59

57.8

102

100%

Total TABLE 3.18

FIGURE 3.18 ANALYSIS AND INTERPRETATION

The given table and graph shows that 57.8% respondents Won’t accept maggi again,because they are scared about the quality of this products.But 42.2% are ready to reaccept maggi if they comeback after solving problems.

CHAPTER 4 SUMMARY OF FINDINGS, CONCLUSION & SUGGESTIONS

4.1 FINDINGS •

It has been found that majority of the respondents are users of any kind of ready to cook food products. Out of 150 samples 102 respondents are users.

•

It has been found that majority of the users comes between 15- 30 age limits.

•

Majority of the respondents are either salaried employees or students.

•

It has been observed that majority of the respondents using it because of its easy in preparation.

•

Children in the family mostly preferring noodles and other ready to eat food products.

•

Majority of the respondents are not aware about the quality of these products.

•

It has been noticed that majority of the respondents are not aware about the health hazards of these products and even they don’t know what is MSG LEAD and other ingredients of the products.

•

It has been found that only minority respondents substituted the products after Maggi’s issue, out of those minority respondents around 60% choosed SUNFEAST YIPEE.

•

It has been noticed that majority have the opinion that advertisement and brand ambassadors have an influence on their buying decision.

•

It has been found that majority of the respondents are now in fear to recommend noodles for their friend and relatives.

•

Majority of the respondents have the opinion that the Maggi issue has an impact on Nestle’s products and in the whole ready to cook food products.

•

It has been found that majority of the respondents denying the reacceptance of Maggi.

4.3 CONCLUSION Traditionally Indians believe in consuming fresh stuff rather than packaged or frozen, but the trend has changed India became a top market for fast food companies. There are various companies like Nestle, Sunfeast, Horlicks, Ching’s, Maruchan Ramen competing each other in Indian market. Maggi is a product that belongs to Nestle India, which is one of the leading fast food companies in the country. But few months back government of India banned Maggi Noodles because they are using monosodium glutamate (MSG) and lead beyond the permissible limit in their product. This Maggi issue has made a negative impact on whole Indian ready to cook products market. The sale of the total industry declined by 60% to 70%.The total industry now under a radar view because the customers and other authorities doubtfully watching these products. In order to overcome these problems the study insisted that the companies should come out with new advertisement techniques, promotional campaigns and especially customer awareness programmes.

4.3 SUGGESTIONS AND RECOMMENDATION •

I am suggesting that the company should form a separate Quality Administration Committee in each production unit to ensure the quality of every product.

•

The company should strengthen the social net working system of the company and customer relationship.

•

The companies should open its own various outlets throughout the country with customer information centers.

•

Maggi should introduce an alternative snack in the ready to cook market which will help the relaunching of Maggi in a new format.

•

Should launch new advertisement campaigns (TV, RADIO, etc...) with credible stars.

•

Should strengthen the distribution channels of the company especially in rural areas.

•

Conduct Promotional campaigns at schools, colleges, and towns where people are more than 1000.

•

The customers should check the ingredients and other relevant information before purchasing a product.

CHAPTER 5 EXPERIENCES AND LEARNING

5.1 EXPERIENCES AND LEARNING I got an opportunity to go through the details of various ready to eat food during the last one month as a part of MBA 3rd semester project. Meeting with different consumer was different experiences. I met 150 people with 150 attitudes. Some respondents were worried about the

present conditions of the instant food market. Another group of people were supporting the ban of Maggi noodles from the market. Out of 150 respondents some of them positively responded to my questions where a few group didn’t take it seriously. I wondered about the people’s positive attitude toward this survey. The peoples had a lot of doubts about the Maggi’s banning. So I tried to clarify those doubts as possible. I understood a lot of things about the instant food industry which was before unaware for me. Learned about the ingredients of noodles, specifications, etc...I got idea about the major players of ready to cook food industry in India and the market share of each company. Maggi was a group of products from Nestle Company, so learned the history and different types of products of the Nestle Company. I studied the different types of crisis management techniques used by the Maggi. The Nestle Company recalled 27000 tons of Maggi noodles from outlets and they send samples for their own testing and external lab testing. The company authorities met the media and gave clarifications. I understood that what a management should do on a crisis time. If any problem happens to any product of a company the effect is not only to that product or other products of the same company but also to the whole industry. Why I am saying it because of the Maggi’s ban the total sale of Nestle as well as the whole industry declined industry declined. I understood the importance of quality management in each product. The company should be more ethical to the society. Business should give priority to consumers. In the case of Maggi they were not gave much importance to Indian consumers. In the case of a multinational company the company affairs must be under the law of each country.

5.2 WORK DONE DIARY

WEEK

WORK CARRIED OUT

INITIALS OF GUIDE

I had a rough idea about my topic that is Effect of banning of Maggi in other ready to eat products. Now days it is a big problem in the Indian market. I went through the various details about the Nestle and Maggi through their website. I made a brief plan of action. I 1

collected several other data through internet about the Maggi banning. This was helpful for the preparation of my questionnaire. Based on the information which I collected I started to prepare

questionnaire.

I

need

a

simple

questionnaire which gives accurate and detailed information for the preparation of my project. I did data collection in this week, distributed 150 questionnaires among the people who are staying in our area and gave instructions to them 2

about the questionnaire filling. Collected the filled questionnaire. I started sorting data in this week. Based on the sorted data I started to make tables. I formed 18 tables based on the questionnaire responses,

3

also prepared 1 diagram for each table. I went through so many journals, articles about Maggi banning and its impacts on Indian ready to cook products market for my review literature and for

other pillars of my thesis. 4

I submitted a rough report to my guide for correction. She made all the corrections and gave it back to me. I Started documenting the project.

APPENDICES

QUESTIONNAIRE

PERSONAL DETAILS Name

:

Occupation

:

Age

:

Education Qualification

:

GENERAL DETAILS

•

Were you a consumer of Maggi or any other ready to cook food products?

(A) YES •

•

(B)

NO

How do you perceive these products as •

GOOD FOR HEALTH

•

READY TO EAT

•

JUNK FOOD

•

TASTY/FUN EATING FOOD

Who among your family members mostly prefer Maggi or other noodles? A. CHILDREN B.SPOUSE C.PARENTS D.OTHER

•

Are you aware about the quality of these products? (A)YES

•

Are you aware about the health hazards of these products? (A) YES

•

(B) NO

(C) LITTILE

Do you know what is MSG, lead and other ingredients in these food products? (A)YES

•

(B) NO

(B) NO

How do you prefer this kind of ready to eat foods? A.BY WATCHING ADVERTISEMENTS B. RECOMMENDATIONS FROM FRIENDS AND RELATIVES C. BY CHECKING PRODUCT QUALITY

•

Have you chosen any similar products after Maggi’s ban? (A)YES

(B) NO

•

•

If yes which among the following is your choice? •

SUNFEAST YIPPEE NOODLES

•

HORLICKS FOODLES

•

CHING’S INSTANT FOODLES

•

OTHER

Are you satisfied on these substitute products? (A)YES

•

Do you think that brand ambassadors have influence on customers buying decision? (A) YES

•

(B) NO

Do you think that Maggi’s ban is the protection of consumer rights? (A) YES

•

(B) NO

Do you think that the Maggi issue has affected other products of Nestle Company? (A) YES

•

(B) NO

Will you suggest noodles for your children or relatives now? (A) YES

15

(B) NO

Do you think that ban of Maggi has an impact on Indian ready to eat product industry? (A) YES

•

(B) NO

(B) NO

Will you accept Maggi if they come back after solving problems? (A) YES

(B) NO

BIBLIOGRAPHY

BIBLIOGRAPHY BOOKS REFFERED •

LA STRATEGIE NESTLE (NESTLE STRATEGY), HELMUT MAUCHER.

•

FAST FOOD: ROADSIDE RESTAURANTS IN THE AUTOMOBILE AGE, JAKLE, JOHN (1999).

•

DEVELOPMENT OF A MEASURE OF THE MOTIVES, UNDERLYING THE SELECTION OF FOOD: THE FOOD CHOICE QUESTIONNAIRE, APPETITE,ANDREW STEPTOE & TESSA M. POLLARD, (1995),

JOURNAL •

THE WALLSTREET JOURNAL.

•

BRITISH FOOD JOURNAL

•

JOURNAL OF FOOD PRODUCTS MARKETING WEBSITES •

WWW.INSTANTNOODLES.ORG

•

WWW.WIKIPEDIA.COM

•

WWW.NESLTE.IN