Section A_ Group 11.docx

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VISION 2020 SECTION A – GROUP 11 ANIKET PANDIT ARMAN BEHERA

UM18009 UM18014

SANDEEP PILLAI

UM18053

SASWATA SAMANTA UM18062 VAIBHAV SAITH

UM18062

YASHODHAN JOSHI UM18068

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1. INTRODUCTION In the wake of the recession hitting the country in the aftermath of the global economic crisis, there was still some optimism regarding the market for commodities and other FMCGs. They were expected to make handsome profits when the rest of the sectors were bleeding. This was based on the common belief that commodities and necessities were next to indispensible. Also, since the FMCG industry was largely immune to the initial shocks, hopes were high that good times would continue to prevail. But as India headed towards the fag end of 2011, the effects started becoming noticeable. The country saw all the major FMCG firms in India struggling due to the increasing price of raw material and the inflation rates. Godrej was no exception to this. The premium segment took the largest fall among the product line that they offered. The top-line and premium products saw lesser number of takers as a good number of erstwhile consumers switched to cheaper alternatives. Traditional consumers were uninformed and not involved in production and were thus largely uninformed. The need for comfort reflected in their buying behaviour. 46 % of the switchers were satisfied with the latter products’ and said that they had exceeded their expectations. 34 % of them no longer wanted to switch back.

(Source: Bohlen (2009), McKinsey Quarterly)

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These fluctuations played a major role in the industry turning an eye towards the largely untapped rural markets. Although the erstwhile rural markets were unorganized, they had huge potential to grow. Cost-volume leadership was the aim for all the major players. While re-thinking packaging strategies was the most common method used by HUL, Marico and Dabur, innovation was at the helm of Godrej’s thinktank. This could give well be the ingredient towards a much larger objective (Vision 2020) but involved the risk of losing the early bird advantage.

1.1 Innovations and first movers Godrej has been a long standing champion when it comes to innovation which is why they depend extensively on it. From introducing the first lever based lock to the Chotukool portable refrigerator, Godrej has come a long way. They have also shown remarkable examples of novel ideas when it comes to channel partnerships and supplychain innovations. While working on the ChotuKool project, the team hit a roadblock in the form of a pricing constraint which meant that the traditional supply methods did not work well for distributing a low-cost, low-margin product to customers in rural areas having few appliance stores. The team experimented with several approaches, talking to as many people and experts as possible to find ways to solve the problem. the team had a breakthrough when G Sunderraman, the leader of the project, came up with a completely new idea of integrating post- office employees in the rural areas a part of their sales and distribution chain. This helped them penetrate into the deepest and the most untapped rural markets in India. While working on the ChotuKool project, the team had a breakthrough when G. Sunderraman, the leader of the project, came up with a completely new idea of integrating post- office employees in the rural areas a part of their sales and distribution chain. This helped them penetrate into the deepest and the most untapped rural markets in India. On closer observation, it is seen that their competencies have been diverse ranging from lock making solutions to chemicals to insecticides. The company saw a very smooth expansion from lock making solutions to personal care FMCG products which then became its poster boy (GCPL). But when Adi Godrej, the chairman announced Vision 2020, which targeted a CAGR of 26 percent for the next 10 years (10 times in 10 years) when their top performer GCPL grew with a CAGR of 17.1 % , it looked like another example of stretched vision which was far from being real. Although the rural markets had huge growth potential in consumer product segment, taking the internal capabilities to another level was something that was imperative to achieve the above. Also, a series of prudent acquisition and merger decisions would be the deciders of the level and extent of inorganic growth activity that could be achieved. The report aims at analyzing the strategies implemented by Godrej towards achieving Vision 2020.

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2. INTERNAL FACTORS As part of its 10 X 10 strategy, Godrej concentrated on revolutionizing its internal environment and all the factors affecting it. To reach its end goal of 26% CAGR, Godrej identified some of its internal factors which it needed to work upon. Some of the factors were: Staff : Godrej employed a 360 degree evaluation strategy. It’s the first organization in India to adopt this, having learnt the technique from its joint venture with GE. Most organizations use the downward evaluation process wherein a management level employee gives feedback to a subordinate on his/ her performance. 360 degree evaluation involved both upward as well as backward feedback seeking activities. Not only that, it took into consideration views from external sources like customers, suppliers and all the concerned stakeholders too. The process allowed for a free flow of information and a two sided communication which made the employees at all levels feel valued. It also allowed for the employees to realize on their shortcomings on improve on those. Godrej Capability Factor (GCF) : GCF is one of the unique initiatives adopted by Godrej to aid in their quest of finding the best of talents in the country. It is an annual talent management process which focuses on defining the critical capabilities required and the behaviours expected from an employee. The initiative’s main purpose is to churn out future business leaders to take the organization to greater heights. From this programme, Godrej identifies the high performers and manages their careers. The selection is mostly done internally from managers’ recommendation. Godrej LOUD is one of a kind campus recruitment drive adopted to attract the cream of the talent. The drive demands the applicants to submit a video of their dream they’d like to fulfil. Godrej believes that if employees are passionate enough to achieve their dream, they are capable of translating this same passion into their work. Godrej believes in expression and freedom which shows from the way it treats its employees. A classic example of this would be its dress code and the culture lab. Godrej also believes in inclusivity, which helps in creating a safe, productive and happy work environment. Organizational Change: After getting hit by the economic slowdown following the recession, Godrej concentrated on focusing its efforts on increasing the profitability instead of sales. It planned on saving ₹250 crores annually with the introduction of Project Pi. To achieve this colossal task, Godrej decentralized its leadership in domestic operations to concentrate operations at micro level. It delegated leadership for the state run operations and placed a larger amount of emphasis on it. One of the major changes implemented by Godrej was assigning the chairmanship roles of two of its major companies GCPL & GPL to Nisaba Godrej and Pirojsha Godrej respectively. Globally, Godrej dropped the international business operations head position and formed clusters of regions. It formed three clusters as part of its 3 X 3 strategy. This change helped in consolidating all the acquisitions made by the company and also helped in cross clustered growth. The disbanding helped in collaborating activities over the clusters and made it act like a unit.

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R&D: Godrej has always been a forerunner in R&D in the FMCG sector. Out of the total sales it makes, it reserves 1% for R&D. With the adoption of the ten year strategy, Godrej upped its ante in the R&D sector. It followed its plan of launching a new product every quarter. As a result, from the years 2014-2016, it launched ten new products. Godrej’s innovation spree has led to a range of new products revolutionizing the home insecticide sector. Godrej’s affordable Good Knight fast card proved to be a useful weapon in rural areas where power is inadequate. Its anti-roach gel paved a way for a new way of killing cockroaches. These new products accounted for about 40% of incremental growth of the organization. If it hadn’t been for innovation, Godrej’s slow growth of 17% in the years 2014-16 would have been just 10%. Culture: For years, Godrej was known as a dull and conservative organization. As a manufacturer of cupboards, soaps and refrigerators, it had created an ‘old lady’ image for itself. There had been a shift in this culture and a revamp of its image with the initiation of the 10 X 10 strategy. The organization had adopted an approach where the notion of ‘what employees can do to the company was replaced by ‘what company can do to the employees’. This proved to be an attractive prospect to all the best of talents. In order to stay relevant, Godrej evolved its values and cultural code. Culture lab, new state of the art working facility, freedom of expression and inclusivity were some of its approaches in establishing itself as an employee friendly organization. Godrej lived by the Sanskrit word Antevasin, which means living at the border. It believed in keeping one foot where you come from and the other moving forward constantly. Even with its new face, Godrej believed in keeping its old values intact of trust and being the custodians of the brand.

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3. GCPL IN THE WAKE OF ECONOMIC CHALLENGES As Godrej announced its ambitious goal to expand revenue ten time over the next ten years to become an INR 85,000 crore conglomerate by 2020, the economies were still trying to recover from the effects of 2008 recession. In order to achieve such significant growth consistently over a long period of ten years, it would require it to grow at an CAGR of 26%. During FY 2010-11, the Indian Economy, on the other hand was showing notable resilience to the effects of the global economic recession, outpacing other economies with an estimated growth rate of 8.5%. The outperformance was primarily led by the services sector and supported by a rebound in agriculture and in the manufacturing sectors. The savings and investments of the consumers increased, which caused an increase in the private consumption. This increase in domestic demand was one of the main components contributing to the growth of Indian GDP. However, higher interest rates and the alarmingly high levels of inflation at the beginning of 2011 threatened to severely hamper the GDP growth. The company quickly realised that simply focusing on the domestic market would not help it to reach the CAGR of 26% year on year. For such a substantial increase it planned to diversify into new business segments both in the domestic markets as well as international markets. During 2010-11, GCPL which was the major constituent of the group, acquired more than eight business in India and overseas. The Company has seen its brand reach grow through the employment of new initiatives focused on development, particularly in the rural space. In addition, the Company continues to advance outward, expanding its global reach to diverse regions around the world, and its international business had performed significantly well despite of the tough economic conditions within which it was operating. FMCG Companies continued to venture out into the rural markets, which was among the fastest growing segments as the purchasing power of the population was increasing rapidly due to an increase in the nominal income. With more than 140 million households in the rural areas which was more than thrice the urban households, the company was banking on its growth at the bottom of the pyramid to help achieve its ambitious goal of growing ten times by 2020.

The company followed the 3X3 approach with the main focus of the strategy to enhance its domestic and international presence and create a multinational business driven by growth in three categories - Hair Care, Home Care, and Personal Wash across three regions of Africa, Latin America and Asia. All these factors helped GCPL have an outstanding year with its revenues increasing from INR 1268 crores in FY 2009-10 to INR 2395 crores in FY 2010-11, with a significant growth of 89%.

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FY 2011-12 began on a bad note with the debt crisis in the Eurozone, as a result the developed economies continued to struggle. It became increasingly clear and evident to the group that it had to target emerging economies to achieve its significant growth. The emerging economies were pegged to grow at 6.2% contributing significantly to the global economic growth of 3.2%. However, India continued to be plagued by its own internal problems. The Central Governments revenues collection was much lower than anticipated, inflation levels were high leading to high interest rates. Supply chain bottlenecks, relatively weak manufacturing activities, ever increasing costs lead to a lower GDP growth rate of 6.5% as compared to previous years. In spite of all the challenges, GCPL’s business in India, Bangladesh and Sri Lanka kept on growing. Revenues grew from INR 2476 crores to INR 2998 crores, showing an increase of 21%. Things were looking very positive on the International business side, GCPL’s abilities and strong understanding of the dynamics of these businesses helped it leverage its distribution and supply chain efficiencies as well as its strengths in terms of brand management, technology and manufacturing to create immense value. The revenues grew an astounding 54% from INR 1207 crores in FY 2010-11 to INR 1864 crores in FY 2011-12.

FY 2012-13 was a rough year for the Indian economy, as compared to the solid growth it had seen in the previous years. The ongoing global ambiguity did impact growth in India, a number of other challenges were plaguing the domestic operations. Low growth in manufacturing sector, slow reforms, increasing current account and fiscal deficits and a high inflation rate. Further, the weak monsoon aggravated the situation by adversely impacting the agricultural sector. At 5%, the GDP growth rate for FY 201213 is the lowest in a decade. Due to a strong growth in revenues from rural India, which was now accounting for about one third of the total revenues of the FMCG sector, it kept on growing at 18%. GCPL did slightly better than the industry by growing by about 20% domestically. Overall, considering the international businesses, GCPL’s consolidated sales grew by 32% to reach around INR 6391 crores. Profits grew by 10% to INR 796 crore as the input costs pressures eased as compared to the preceding year. Material Costs as a percentage of sales declined to 46.2% as compared to 47.7% of previous year. During FY 2013-14, economic conditions of India worsened, slow economic growth coupled with political logjams, high inflation, a falling currency and fluctuating equity markets. Growth rates halved when compared to previous years. Capital investment and growth in manufacturing and services became sluggish due interest rates hikes and. We were however fortunate to have a good monsoon that helped agricultural output. Devaluation of the rupee was also been kept a check on by intervening measures by RBI. GCPL, however kept on growing, outpacing the growth of FMCG sector of 15% by growing at a rate of 20%. Consolidated Net Sales grew to INR 7583 crores, EBITDA grew by 16% to INR 1177 crores.

Fiscal Year 2015 saw a revival of the Indian economy. GDP growth increased to 7.4% from 6.9% in the previous year. Inflation dropped to 6% from 9.5%. The ease of lending rates and structural reforms such as the implementation of the Goods &

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Services Tax and enactment of the land acquisition bill were the key drivers of demand. Depreciating currencies and weakening growth businesses, globally. Godrej however, navigating them with a sharp focus on costs and constant innovation. Consequent to the turbulent macroeconomic scenario, the FMCG sector registered a sluggish growth. Consumer demand in the second half of the year, however, started to show early signs of a recovery. GCPL yet again outperformed the overall growth of FMCG sector by growing round 9%. Consolidated sales grew to INR 8242 crores with EBITDA of INR 1369 crores. From 2016 to 2018, two major economic reforms took place: Demonetization and GST. Demonetisation led to a significant push towards digital financial transactions, as well as improving the tax net. But, as the retailers were stocking lesser goods than ever before due to cash and supply constraints and consumers were spending more cautiously, the sales of FMCG sector took a beating. One study revealed that one out of every housewives reduced their spending by 50%, Purchase of personal care items such as toilet soaps, toothpaste and shampoo has seen the steepest decline by retailers. While rural India has managed to stay flat at 0.4% mainly due to smaller packs and smaller currency transactions. Some of the macroeconomic indicators dropped, like a decline in the GDP growth to 7.1 per cent in the fiscal year 2017, from 7.6 per cent in the fiscal year 2016. Inflation was largely under control. Though growth rates in the FMCG sector were below historical averages and long-term potential, yet GCPL outperformed the markets in its core categories. There were signs of recovery in consumer demand in the FMCG industry. The fundamentals of the industry remained strong and there was still significant growth potential, given the low penetration and consumption rates for many FMCG categories.

PESTLE ANALYSIS To get a better understanding of the various external factors affecting the overall growth of the company, Godrej, we conducted a PESTLE analysis, via which we look at various factors which have influenced and shaped the strategies, which Godrej has implemented in an effort to achieve their 10X10 growth strategy and vision 2020. Following are some of the findings that have come up as a result of this analysis – 1. Political – A slew of political decisions and policy outcomes have affected the growth strategies of Godrej. In 2017, Godrej chairman, Adi Godrej stated that their extravagant target of growing at a CAGR of 26 percent, in order to achieve their vision 2020, that is growing a company the company to 2.5 times its size ( as of 2010), might not be possible. The company got 100 percent tax exemption for five years and 30 percent from another five years from 200616, in North-east and Himachal, which further helped companies like Agrovet, to have greater growth in the initial period. A 700 crore rights issue against Godrej Properties Ltd. in 2013 had increased the company’s ability to launch new products in important markets. One of the political factors which can be attributed to this could be the “demonetisation” policy of the

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government of India, which suddenly slowed down the economic growth of the country. This affected the growth of Godrej, which up until that time, had a CAGR of 30 percent, but post demonetisation, this fell below the desired 26 percent, which Godrej did not take into account while drawing up their vision 2020. 2. Economic – A major dampening factor from the economic point of view for Godrej, was the drop in inflation since 2010. The inflation in India during 2010, was quite high and it was this trend that led Godrej to aim for the highly ambitious target of growing to 2.5 times of its size within 10 years. But, after 2016 inflation slowed down causing the growth of the company to slow down, leading to Adi Godrej proclaiming that the company might not achieve the robust targets they had set for themselves earlier. 3. Social – With the growing population need for chemicals has also increased by leaps and bounds, thus causing a huge boom in the sales of the second largest business of Godrej which again attributed to a large amount of the growth that Godrej achieved and hoped to achieve as a part of the vision 2020. Also increase in crude oil price many industries are switching to oleo chemicals. The chemical produced may also be harmful to labour involved. Thus proper safety measures have to be adopted. Also the waste produced can be harmful to nature. Thus proper waste management is required. Change in lifestyle is also an important factor; people switching from animal oils and fats to vegetable oils and fats. These factors attributed to the growth of the Oleo chemical industry wing of Godrej. A major part of the population of India, especially the rural parts, are largely dependent on agriculture as a source of livelihood, this contributed to the growth of Agrovet, which again was another prominent factor in the building and execution of the vision 2020 for Godrej. The growing population of the country coupled with increasing purchasing power of the people of India and Godrej’s policy of targeting emerging markets, added to the growing sales of the consumer products wing of the company, GCPL. In 2013, many developers and land owners were under “liquidity pressure”, providing Godrej Properties Ltd. with “strong opportunity to add new projects at attractive terms”. These social factors also played a huge role in the formulation of vision 2020. 4. Technology – Trends in the technology world in recent times has also played a huge part in the formulation of the vision 2020. Godrej has put a lot of focus on e- commerce to drive the sales of their products. They have identified ecommerce as a viable medium to increase their sales leading to tie ups with major e- commerce brands such as Ebay and Flipkart. Godrej Tyson has partnered with various e- commerce firms to increase its last mile reach and thus continues to grow at 16-18 percent. The boom in the e-commerce sector has led Godrej to identify this as a major part of their growth strategy and a huge player in the achievement of vision 2020.

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5. Legal – All indirect taxes have been replaced with GST, which affected the FMCG industry adversely. GCPL, the FMCG wing of Godrej was most affected by this. The law forbids FMCG companies to falsely increase prices by making product scarce. 6. Environment – Good monsoon is very essential for the growth of Agrovet, when asked about the impact of monsoon Adi Godrej said: "If the monsoon is good, then it would help the Godrej group very considerably. Rural consumption would improve and second Agrovet, which works only in the rural areas for all its products as animal feed and agri input, would also benefit." Poor monsoons will drive low rural demand affecting agrovet which has been driving at an annual growth rate of 16.85% in the fiscal year 2011. Poor monsoons over the last couple of years has floundered the initial growth spurt of Godrej since 2010 , and is attributed to the overall decline in growth and the subsequent prediction of vision 2020 not being achieved by Mr. Godrej.

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4. OPERATIONS AND IT STRATEGIES Godrej Consumer Product Limited (GCPL) To implement 10x 10 strategy Godrej envisioned on creating 3 x 3 CREATE Strategy. To create a 3 x 3 Strategy Godrej focused on 3 emerging markets of Asia, Africa and Latin America and 3 primary categories of Home, Personal and Hair Care. GCPL does not implement forecasting strategies. GCPL refrains from finding out key trends to predict. They use Agile Strategy to keep track on daily demand basis through sale of products. GCPL uses a replenished model of TOC, Theory of Constraints which focuses on increasing Throughput by managing bottlenecks. TOC implementation lead to prediction of bottleneck in operational processes and the Supply Chain Model was implemented accordingly. On implementation of TOC, GCPL finds out that 15%20% of demand is unmet and then attempt to reduce the unmet demand to 2%-3%. They also attempt to reduce manufacturing cost and make the production more responsive to changers. Godrej emphasises its employees on keeping Customer Feedback as primal importance and not maximize productivity on production floor. GCPL has 20 inhouse manufacturing facilities across Baddi (Himachal Pradesh), Puducherry and Malanpur (Madhya Pradesh) and North East. As long as the cost to service the customer is lower, GCPL is not concerned with Logistics cost. GCPL attempts to keep manufacturer closer to Consumers. JIT, Just in Time is implemented in manufacturing where assembly line is not dedicated in making one product but instead 20-30 different kinds of products which reduces the switching cost when demand for a particular product increases. GCPL uses SAP based Information System to manage operation from ordering to distribution. The front end distribution system is managed by APO, a module of SAP. Batch lifecycles are monitored by Built in Reports of the system. By implementing SAP platform some advantages GCPL experiences was reduced manufacturing and procurement cost, improved delivery performance and many more. GCPL also aimed to achieve Godrej Good and Green Vision by 2020, by implementing Sustainable Procurement Policy in which GCPL bonds with suppliers who follow Green practices which would help them build an ethical and sustainable business environment. Operational modification by Reducing, Reusing and Recycling materials and products, adopting green initiatives and practises, Quality management System, Material management and Quality Control are some methodologies used to achieve the strategy.

Godrej Properties Limited Godrej Properties operate in 12 major cities of India. It is currently estimated to have covered 89.7 million square feet through its projects. In 2008, Godrej developed Planet Godrej, tallest occupied skyscraper in India at time. Godrej Trees is one of

13 India’s most sustainable project. Godrej Properties implemented the partnership model where a Joint development Partner, usually a local vendor who contributes the land, was given a share in the property developed or profit arising from the project. This was a concept of Revenue Share model wherein the land owner gets a 30-35% share of the project and the rest was taken by GPL. However if the developer wasn't about to create cash they were compelled to pack up as a result of no profit in the project undertaken. Therefore GPL decided to go ahead with Percentage Model where 60% to 70% is spent on cost coverage of project, the remaining profit is split equally between both the parties. With government subsidizing the housing loans of small and medium standards, Godrej Properties shifted their focus to gain contracts by using their contacts gained through GCPL’s BOP operations. Godrej Agrovet (GAVL) Godrej Agrovet strives to uphold sustainable and eco-friendly practices. The apply waste Management Policies to their operational practices and intend to reduce hazardous and non-hazardous waste generation. Godrej Agrovet ensures safe and secure management, usage and transportation of materials. Incorporate environment friendly practises at design phase to reduce waste generation throughout the process. They follow waste management hierarchy of Avoidance, Reuse, Recycle, Disposal and Treatment and Energy Recovery. Godrej Chemicals Godrej Chemicals have two progressive producing facilities in Valia and Ambernath, they tend to drive a relentless specialization in productivity and energy conservation. Godrej Chemicals tend to turn out over 160,000 metric tonnes of chemical merchandise annually, to be used in home and private care, rubber process, polymer, pharmaceutical and industrial applications. Safety, Quality and Health Standards are particularly focussed on in Plants of Godrej Chemicals. Godrej Nature’s Basket Nature’s Basket is a fresh food and grocery store introduced by Godrej in 2005. It has its physical presence of 35 stores in India and caters to 25 cities through its ECommerce platform and Mobile Application. In Nature’s Basket Quality is of primal importance. Separation of products with expired dates are done and such products are eliminated. Inventory management practices are done to keep the stores stocked. Return and exchange of expired and spoilt products are practiced. Recently the focus of Nature’s Basket has been shifted to more of an online presence with the closing of operations in Delhi NCR region and catering to the capital through ecommerce platforms like Snapdeal and Amazon. Currently Godrej Industries is focusing on E Commerce for sale of all of its products. The best E Commerce Platforms are selected for each vertical and are implemented. Godrej is planning to increase the business through E Commerce from 2%-3% to 6%8% by 2020. Recently they have partnered with a few E Commerce companies like Flipkart and EBay in order to expand its last mile reach. Delivery of products at the footstep of the customer is of primal importance to Godrej.

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5. MARKETING STRATEGIES The Godrej group identified four businesses to focus more and develop them  Personal Grooming : Venturing into hair color market which has a scope of about Rs 500-600 cr market in India. Also focussing more on the soap industry.  Properties: The group plans to build residential and commercial projects to build its presence in the real estate market  Furniture: To drive growth in the home and office business  Appliances: Leverage the technologies and innovation capabilities of the company. DISRUPTIVE INNOVATION 1. Godrej believes in driving growth through product innovation to provide efficient and affordable solutions for all. They developed a product specifically for he Indian market ' Good Knight Fast Card ' which is a paper strip acting as a mosquito repellent when it's burnt. It is priced at Re 1 and is effective for several hours. GCPL realised the need for such an innovative product with an estimated market of Rs 2880 crore (Oct 2013). The company was aware of overlap and cannibalisation of its other products but it focused more on need and demand of the new product. They tried to tap into the untapped market, the population of 56% of Indians who do not use mosquito repellent as of now.

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2. Godrej decided to create products that targeted “non-consumption”—meaning

Indians that couldn’t afford appliances. They observed that 80 percent of Indian households lack refrigeration and identified that as an opportunity. Then Godrej conducted an extensive market research all across India and understood the challenges faced by rural population regarding refrigeration. As Godrej understood the challenges and came up with Chotu Kool a small refrigerator with new cooling technology, compact size and easily serviceable parts. It was priced at Rs 6000. Further Godrej realised just launching the product would not do, they had to influence the women of the household to buy the product to

understand its need and utility. To reduce the costs even further they tied up with postal offices to deliver the product. Thus Godrej won the Edison innovation award. Design thinking and lean start-up experimentation tools are transforming the company into an innovation leader. Godrej’s innovation premium has jumped by over 50 percent in the past 5 years and it is among the innovation stars of most innovative growth companies list.

GCPL Godrej had a saturated market share because of increased competition from local as well as international players. The group recognised the rising disposable incomes and demand in rural markets. This lead to strategies focused on the bottom of pyramid consumers in the rural market.

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Godrej follows 4A strategy to market its products. The 4As are Availability, Affordability, Awareness, and Acceptability. Availability: Ensuring all the products are available in the innermost parts of the country is a huge challenge with 627,000 villages and 700 million people. Affordability: Products need to be affordable to rural consumers, well within their income. Innovation comes into play to make viable and feasible products Awareness: Many promotional events and campaigns need to be organised to make rural households aware of the product. Advertisements on rural channels like Doordarshan and All India radio. Also providing free samples for adoption. Acceptability: Mass marketing and connecting with the consumers on a personal level to make the product acceptable. Product localization using regional language product manuals and menus.

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GAVL The primary element of GAVL's business strategy is to increase the existing market share and look for newer inorganic opportunities. In the animal feed business, the company is implementing cost leadership by reducing operational costs to counter its competitors. In the crop business, the aim is to innovate through expansion of product portfolio. Strategy for the oil palm business is to increase focus on R&D and acquire area in certain regions. In the food businesses- dairy, poultry and processed foods, the aim is to improve the reach of the product and the presence through product portfolio.

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GPL GPL's property business was more vulnerable to a slowdown. Godrej strategised to build homes in the lower segment from Rs 5 lakh to Rs 25 lakh. It launched low-income housing projects in the suburbs of Kolkata, Ahmedabad and Mumbai. Other players in the market were banking on higher margins but not Godrej. They plan to sell in large numbers from 2,000 to 5,000 houses. Godrej is one of Mumbai’s largest landowners and is developing properties in Vikhroli (central suburb of Mumbai) in a move to target rural markets and low-income housing. The best part for Godrej is its brand connect with the customer and its efficient distribution system.

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6. INORGANIC GROWTH In order to fulfil its goal of 10x growth in ten years, Godrej planned to grow both organically and inorganically. To grow inorganically, Godrej planned on following the 3 X 3 strategy which follows acquisitions of companies in three continents namely Africa, Asia and Latin America and in three segments namely home, personal and hair care. Godrej’s strategy of venturing into the emerging nations proved to be a blessing with GCPL’s 50% of sales coming from international markets. From the years 2010 to 2016, Godrej has acquired around eleven companies in Kenya, South Africa, Nigeria, Argentina and India. One of the latest companies to be acquired by Godrej was Strength of Nature, an American company which makes hair care products for the African women. This acquisition helped Godrej to establish its presence in the US for the first time. Some of its other acquisitions include Darling group, a Ghanaian hair extension company, Canon chemicals in Kenya, Frika in South Africa. Other acquisitions in Africa include Inecto and Renew. To target the middle income group in developing nations, Godrej entered UK and Middle East with the acquisitions of Keyline Brands and FZE respectively. Godrej displays its strong presence in Latin America with brands like Argencos and Cosmetica Nacional.

7. CONCLUSION In 2017, Adi Godrej declared that the target of Vision 2020 would be missed. The major hindrances to the journey were as follows: 1) Fall of rupee against the dollar starting 2013 : After growing at a whopping 30 percent for 2 continuous years, the growth hit a roadblock. Looking at the external environment, this can be attributed to the fall in rupee by 20 percent between May and August 2013. The root cause were the late effects of The Great Recession which led to the rise in costs of input materials that were imported. Moreover, the value from exports that were realized went down simultaneously. 2) Shrinking FMCG markets : The FMCG markets that had survived the shocks of the early slowdown finally took a fall. This was experienced by all the players in the business alike. GCPL, the flag-bearer of the group was no exception to this and thus the first bump in the vision was experienced. 3) Under-utilization of digital capabilities : While the competitors like HUL and ITC capitalized tremendously on the riding e-commerce wave in terms of growth and expansion, Godrej somewhat missed the bus. The integrative global platforms and the omni-channel distribution network is something that Godrej could not champion over its competitors. This can be attributed to the deeper pockets of its competitors that had cash far bigger cash reserves. 4) Slower inflation and De-monetization: The rise in inflation was sluggish in the later half of the target period due to which the profit margins fell below the expected levels . In 2016, De-monetization slowed revenue growth and caused

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a short run demand -supply imbalance. It took them almost two years to recover from the same.

SOURCES 1. Economic times newspaper 2. Business line newspaper 3. http://forum.valuepickr.com/t/godrej-consumer-productsltd/21742 4. Godrej.com

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