KEGGFARMS (INDIA)—WHICH

CAME FIRST, THE KUROILER™

OR THE KEGG™?
HISTORY • Keggfarms Founded in 1967 by Vinod Kapur with
the vision to build a profitable company that
would bring Income & nutrition to India’s poor,
rural villagers. It engineered a chicken that
adapted to rural Indian conditions to produce
twice as much meat and five times more eggs
than existing varieties.
• By 2006, (3 years after Kurolier & KEEGS) the
company had cracked less than 3.5% of the
poultry HouseHolds
 THE TEAM

Mr. V. D. Banati Mr. Milan Biswas C. R. Peck

VP Sales Deputy GM Chief Manager

H. S. Jeena M. K . Mishra Shankar Ghosh

R&D GM Accounting Forester
 THE HICCUPS

• The company revenue in 2005 was Rs.160 million, and the social change Kapur
dreamed of was decades away with this growth! Imitations, both Kurloire and KEEGS
had a bogus market almost equivalent to size of Keggfarms The Imitations was not
only effecting the company’s revenue but also exploiting the poor Households living
on them
• ‘The issue is to improve all the above 3 aspects and realize the immense
opportunity the Indian market provides’
 THE SITUATION

• There is an opportunity with the 30 million households in the interiors of India which
raise chicken in their backyard for eggs & meat
• The urban market which had immense demand and capacity to buy did not have
access to the produce due to poor infrastructure connecting the villages to cities It is
a case of a hugely untapped market divided to two aspects: providing breeders with
chicken variety they need and providing the urban customers the product
 MARKET DEMAND

• The traditional eggs and meat were preferred over the Broiler and Vencobb chicken
and eggs as they offer more taste, health benefits & shelf life NECC (acc to website)
sites a growth rate of 5% for eggs and 11.2% for meat consumption
• The market Tasty egg by KEGGS has generated immense demand at a price double
than reg eggs, from 1400 cartons/day(2006) to 2000 cartons/day (2007) still not
enough to meet the huge demand of 3.5 million eggs in Delhi alone
RURAL BREEDER • A traditional rural breeder raises 5 to 15 chickens
in the backyard for eggs and meat which survive
on savaged seeds, insects, scarp Hence this
chicken has been ‘Naturally selected’ to have
colorful plumage, agility, disease resistance The
eggs have a certain ‘tan’ on the shell and the
meat is tastier then regular 2 major dilemmas the
raiser faces are:
• 1) when to convert the mature birds to meat
• 2) how many chicks to buy as u cannot know the
sex of chicks until its several weeks old
 KEGGFARMS SOLUTIONS/PRODUCTS

• The “Kuroiler,” an acronym derived from the words “Keggfarms,” “curry,” and
“broiler.” had the following characteristics: It was multicolored for camouflage and
because Indian consumers believed that white chickens were intrinsically inferior. It
thrived on household waste, scraps, bugs, insects, seeds, vegetation, and pulverized
sea shells and therefore did not compete with the poor, rural villagers for expensive
grain or require any special feeding. It required no special animal husbandry
methods, protection, medicines, or sheltering that could not be cheaply provided by
using scrap materials readily available to poor, rural villagers. It was big, aggressive,
and wily enough to fend for itself in the open backyard environment. It was
genetically resistant to disease.
 ADVANTAGES

• The Kuroiler by comparison with conventional rural chickens, was meatier and more
productive.
• Normal Hens attained 2.5 kg within 12 months, began laying eggs at five to six
months of age, and then laid 150–200 eggs during their 12 to 16 month egg-laying
period, initially more than 20 eggs per month.
• The Kuroiler rooster reached 4 kg in 12 months and a weight of at least 1 kg at around
three months,at which weight it could be sold for meat if the owner chose.
• Kuroiler meat was “vastly more tasty” than both conventional backyard chicken meat
and industrial supermarket broiler meat.
 KUROILER FFG

• A meat chicken that simply grew faster these chickens required less feed per kg
weight attained.
• Also, chickens sell at a much higher premium over normal broilers. In 2009, plan is to
sell 15.8 million Kuroilers and 11.7 million FFGs.
• KEGGS Tastier, branded eggs Presently sold in NCR, a huge success Both
KuroilerFFG & KEGGS are vastly premium products generate extra margins to the
company.
INNOVATORS SUPPLY CHAIN
 PROBLEM REDEFINED

• The case isn’t about marketing per say, the major setback is the funding required for
a budding entrepreneur to do social justice and hence has low margins. It’s a
Entrepreneur Financial case on the macroscopic level.
• The immediate problems are the imitations and empowering/educating the rural
poor/ reaching out more to them and hence grow accordingly. Which requires
identifying the entire market in an organized manner and developing distribution
infrastructure (which again requires investment)
 WHAT NOW!
• The company immediately needs to separate the two aspects of the business (2 SBUs)
• 1) high margin businesses (Kuroiler FFG& KEGGS)
• 2) the rural empowerment businesses (Kuroiler meat)
• Since Kapur personally does not want to be financially liable for expansion funding the
company can liquated and venture investors for its fast moving high margin SBU and try to
develop one more variety for commercial purposes like Fast foods& restaurants under
KeggFarms name to generate revenue for company, brand and invertors.
• Manage cash flows form this to the rural SBU to empower the vendors and households.
• The problem of imitation in Kuroiler cannot be dealt with immediately without
incurring huge costs as well, company need not worry far too much as the market is
just getting acquitted to such a product, generating awareness, creating a brand,
empowerment is a long way down, and will take huge time efforts and investments to
establish.
• For this, KeggFarms must strategically make tie-ups with NGO’s, NECC, and other
Govt agencies to achieve the long term mission of the firm “to bring Income &
nutrition to India’s poor, rural villagers ”.
• Another commercial way of doing it Go the Suguna way:
• Suguna Poultry is one of the major players in the fragmented poultry industry in India.
Suguna is a classic case of commodity branding. Suguna Poultry started its operations in
1984. Suguna came into a difficult market with a difficult idea. Branding chicken! But
through heavy investment in the media, Suguna was able to create a mind space for itself.
Suguna was promoting itself on quality and tenderness. Suguna has sold live birds and
eggs worth Rs 2020 crore in 2007 without owning a single poultry farm. That makes their
business model interesting.
• The company pioneered contract farming in the poultry industry in India. The company
source their produce through 12000 contract farmers across different states.
• Suguna owns the day -old-chickens, feed and feed medicine and the contract farmer is
responsible for the day to day management of the farm. The farmer gets the assured
income while the company takes care of the risk. In that way Suguna can channel its
valuable resources to marketing and distribution.
• Then the company entered into another lucrative market of selling branded egg.
Each year India produces around 47 billion eggs worth Rs 10,000 crore.
• Suguna has four egg brands and sells over one million eggs a month.
• Suguna launched these value added egg which is fortified with vitamins. This is done
by feeding the laying hen with specialized nutrient feed.I am a regular customer of
Suguna eggs. The brands are Suguna Pro Suguna Active Suguna Heart Suguna
Shakthi Suguna is a commercial brand as such different form Keggframs but is
successful in fulfilling the social market in its own way.