Marico Over The Wall 2021

Problem Analysis
APPOROACH:
1. After completing our Problem Analysis and Research from secondary resources, we finalized our Target Segment.
2. By putting together the challenges mentioned in the case and those we found out, we categorized them in 2 major parts:
a. PRE-Production Challenges: Sourcing of Raw material, Facility Setup, Diversification of Product
b. POST-Production Challenges: Awareness & Education, Believability & Safety, Last-Mile Conversion, Organization of the
Segment
We have tried to propose solutions from our point of view based on available data and combined them into the following proposal
The Idea:
There always exists a good and prospective market for dairy based products such as ice cream, kulfi, yogurt, milk shakes etc. Coconut dairy products
can be the best substitute for dairy milk especially for those in the Asian countries where coconut is abundantly available and is an integral part of
the daily diet. An increased demand for non-dairy probiotic products also have come
mainly from lactose intolerance vegetarianism and milk cholesterol content. In India, Sweet Spot for
coconut pulp is added to ice cream to convert it into a premium product and sold as Marico entering in
tender coconut ice cream by several brands. the consumer
Marico Purchases nearly 10% of all raw coconut (fresh, dried, milling copra, ball copra) foods with
in the country. A whole lot of coconuts that are available for private consumption as Coconut Milk
segregated amongst unorganized players in the market who sell coconut dairy
products such Coconut milk, coconut milk powder, coconut cream. Only a few
recognized players are there. Barriers to entry for Marico will be very less in the
segment as Marico has an already established production facility for processing
coconuts. Bargaining power of Buyer is less.
The main challenges could come in terms of expansion of facility for production and
procurement of more coconuts. Although bargaining power of supplier could be high,
given that there is a steady 1.8 % growth in Coconut production every year with significant stock of coconut remaining in the closing inventory
every year, it is not a very high wall to climb. As the Coconut dairy products production facility can be integrated with the existing hair oil and
value-added hair oil production, Utilization can be adjusted based on demand of Coconut Dairy products and diverted to Coconut hair oil
production, the demand for which is rising at a higher rate than any of the other products by Marico.
Value Propositions: Based on research, some of the proven, of the potential health benefits of consumption of coconut are improve endurance as
Coconut meat contains large amounts of medium chain fatty acids (MCFAs), a type of saturated fat that is much easier for the human body to
digest than animal fats. These fats, also called medium chain triglycerides (MCTs), have been demonstrated to boost the endurance of trained
athletes. It has oral health benefits to as The MCFAs found in coconut meat also contain antimicrobial properties. These can be useful in preventing
infections related to root canals and other teeth issues. Although eating coconut meat is not a substitute for proper dental hygiene, it can help kill
some of the unwanted bacteria found in your mouth and protect your gums and teeth from infection or cavities. Coconut also help in lose weight.
Regularly eating coconut meat might help with weight loss. The MCFAs widely found in coconut meat are associated with fat burning.

Target Group: Our target group shall be divided among two types based on the End Consumers and Customers of Coconut Dairy products. Most
important benefit of Coconut is, its familiarity on the Indian Pallet. Almost
every Indian household has a bottle of coconut hair oil. Consumers are
also taking well to the consumption of Coconut Water. It is a
prevalent commodity in many south Indian homes. Categorizing
the consumption and different ways to consume Coconut dairy
products can expand the demand in this niche segment. Global
Coconut Milk Powder Market size is expected to reach $90.4
Million by 2026, rising at a market growth of 12.5% CAGR during
the forecast period. India packaged coconut water market stood
at $ 9.2 million in 2017 and is projected to grow at a CAGR of
18.4% during 2018-2023 to reach $ 25.4 million by 2023, on the back
of increasing health concerns among consumers due to hectic and
stressful lifestyle.
Impact

• End Consumers: Children from ages of 12-17 years, who like to consume coconut ice creams and parents would also feel
good in making children get accustomed to these products
• Adults from ages of 21-55 Years who look towards healthy eating habit and fitness.
• Since this is a premium category product, expected users will be from Urban and Semi Urban households in Metro, Tier 1
and Tier 2 Cities.
• They may be corporate professionals which conscious control over eating habits, Actors, models, Stay at home workers.
Customers of this includes restaurants, Supermarkets,
• At home cooks bakeries or home boutique owners who make bespoke delicacies. This DIY category attained a lot of
traction in the past few years especially in covid and with people's changing eating habits
 Marico Over The Wall 2021

Below are the coconut milk, coconut powder competitors with competition from Soy Milk, Butter milk and almond products in the healthy dairy
products segment
Dabur Hommade Coconut Milk 200 ml 75 Urban Platter Unsweetened 750 ml 330
Coco Mama 1000 320 Chaokoh Coconut Milk 800 ml 319
KLF Coconut Milk Powder 1000 g 650 Only earth Unsweetened Coconut Milk
1000 ml 300
Nature's Gift Coconut milk powder 100 g 350 Pantai Coconut Milk 400 ml 120
Nature's Spice Coconut Milk 400 ml 140 Maggi Coconut Milk Powder 1000 g 624
Vico Pure Rich Coconut Milk 330 ml 125 Essense Nutrition Vegan Coconut Milk
250 g 375
Kara Coconut Milk 800 ml 280 Real Thai Coconut Milk 400 ml 165
Mystic Hills Organic Living Coconut Milk Poweder 500 g 600 Hands Coconut Milk 400 ml 140
So Good Almong Coconut Unsweetened Plant Based Beverage 1000 ml 247 MRT Organic Coconut Milk 400 g 210
Hye Food Vegan Coconut Milk Powder 200 g 276 Dry Habit Coconut Milk Powder 250 g 230
Pure & Sure Organic Coconut Milk 160 ml Holy Natural Coconut Milk Powder 400 g 430
Saipro Nature our future Coconut Milk Powder 250 g 400 Abbie's Coconut Milk 400 ml 339
Epicurea Coconut Milk 400 ml 120 Pure India Organic Coconut Milk 200 gm 440
Organic Prime Coconut Milk Powder 1000 g 898
Urban Platter Uvegan Coconut Milk Powder 400 g 694

Epigamia Almond Milk 1000 ml 255

Paper Boat Coriander Butter Milk 1500 ml 250
The prospect for consolidation of this segment can create a huge impact for Marico especially as these products are mostly sold through online
channels that marico aims to establish itself in. Even though the target population for this segment maybe small, the demand generated is
significant with its Online Saffola Store, Marico can look to capture this unorganized market through it. Through its digital first, the distribution
and retail supply chain won’t be a significant cost driver which shall boost the profitability associated with these products
Revenue 80480000000
India 0.77
International 0.23 Value addition is the imperative
alternative to improve the farmer’s
total tonnes of coconut produced in india in 2020 income and livelihood security.
(tonne/ yr) 14190000
Coconut purchased by marico (tonne/yr) 1419000
Total revenue from coconut hair oil 52312000000 Currently the capacity utilization is around 75-80%. Assuming that in
Revenue/kg of coconut 36.86539817 future the capacity levels increase owing to recovery in demand and
improvement in distribution channels, we can look at processing of
237683 tonne/yr of additional coconuts, which can be distributed
Coconut Oil 0.43 34606400000 among two factory units that cater to hair oil and value-added hair
Value added Hair oil 0.22 17705600000 products. It is reasonable to assume that for foraying into the
Saffola 0.27 21729600000
Premium Hair 0.01 804800000 Coconut super foods category, Marico can procure 1-2% more of the
Male grooming 0.02 1609600000 total coconuts produced in the country in a year. From a price point
Hygiene 0.005 402400000 of view, whole sale price and msp trends of milling copra and ball
others 0.045 3621600000
copra show opposite trends. For Milling copra, wholesale and MSP
MSP (per quintal) Wholesale (per qunital) Exports
Milling Copra Ball Copra Milling Copra Ball Copra Quantity, tonne Value in Lakh
19-20 9960.00 10300.00 10567.00 9814.00 29043.00 16059.00
Base case (for one plant) 20-21 10335.00 10600.00 10504.00 11923.00
Assumed Coconut processing capacity (tonne/yr) 24000.00 2333.00 3614.00
Assumed capacity utilization (tonne/yr) 18000.00 1439.00 1177.00
Ideal Production capacity (tonne / yr) 6000.00 Price/kg 101.30 Price/kg 101.91 43319000.00 3277300000.00

Price per kg 75.66

Additional cost of procurement of coconuts (in lakhs) 6078.00 6114.30 4539.30

prices for 19-20 were 10567 and 9960 per quintal respectively, while for ball copra wholesale and MSP prices for 19-20 were 9814 and 10300 per
quintal. For 2021, the MSP prices for milling and ball copra have been increased to 10335 per quintal and 10600 per quintal.
In terms of exports of Coconuts, fresh coconut, dry coconuts, desiccated coconuts and copra were also identified. Based on the export value, we
try to assume an upper price per kg of coconut
Kerala, Tamil Nadu and Karnataka are the states in India where coconut palms are extensively cultivated and produced in large quantities. These
states together contribute to approximately 84 per cent of the total area for cultivation of coconut and account for over 87 per cent of total
production in the country.
Based on published forecasting data, production of coconut may be expected to increase by 1.4 % in the next few years, with improvement in
yield per hectare as well. Through their initiatives, the government and other interest groups have contributed to visible hikes in coconut
production and productivity in targeted states.

Road Forward.
A feasibility plan value chain for production of coconut products, marketing plan for product market penetration and goal formulation and a
marketing plan including the segmentation and 4P mix