CADBURY

PRESENTED BY GROUP 5:
APOORVA GARG 18PGDM121
DANISH NASIM 18PGDM125
JAYANT KEDIA 18PGDM129
MOHIT BIHANI 18PGDM136
RAUNAK MOHATA 18PGDM147
SAMKIT CHAJJLANI 18PGDM155
 INTRODUCTION
• Cadbury India is a fully owned subsidy of Kraft Foods Inc.
• With annual revenues of approximately $50 billion, the combined company is
the world's second largest food company, making delicious products for
billions of consumers in more than 160countries.
• They employ approximately 140,000 people and have operations in more than
70 countries
• In India, Cadbury began its operations in 1948 by importing chocolates. After
60 years of existence, it today has five company-owned manufacturing facilities
• Currently, Cadbury India operates in four categories viz. Chocolate
Confectionery, Milk Food Drinks, Candy and Gum category.
• In the Chocolate Confectionery business, Cadbury has maintained its
undisputed leadership over the years. Some of the key brands in India are
Cadbury Dairy Milk, 5 Star, Perk, Éclairs and Celebrations
 PORTERS FIVE FORCES MODEL
THREATS OF NEW ENTRANTS:
• High Initial Capital Required.
• Need Special Requirements and Regulation for the food industry.
• Wide range of products needs experience and knowledge.

BARGAINING POWER OF SUPPLIERS:

• Undifferentiated raw materials (coca, nuts, etc)
• The importance of supplier products to the industry is high(rare/no Substitute)

BARGAING POWER OF BUYERS:

• Low Switching Cost

THREAT OF SUBSTITUTE:
• The threat of substitute is very high in the confectionery industry
• Threat of non-chocolate snacks, fruits, chips, etc.

RIVALRY:
• Advertising Battle
• Price Wars
• Huge range of flavours
 MARKET SHARE
NAME Share FOUNDED Variants

Cadbury 55.5% 1849 Dairy Milk, 5star, Silk

Nestle 17% 1866 KitKat, Barone, Munch

Ferrero 5% 1946 Ferrero Rocher, Nutella, Kinder

Amul 1.1% 1946 Milk bar, Dark Chocolate, Almond Bar

Mars India International 1.1% 1911 Snickers, Mars, Galaxy

Major Players in the same industry
• Nestle India Ltd. – The Company is among the leading confectionery company, being a merger of Anglo- Swiss-
Company formed in 1905, and established in 1866 by two brothers (George Page & Charles Page) founded in 1866 by
Henri Nestle. It is the largest food company in the world with 447 factories, operates in 194 countries, and employs around
333,000 people as global and have annual sales of over CHF1 billion (about US$1.1 US).

• Ferrero India-Ferrero is an Italian food and beverage company founded in 1946 by Michele Ferrero. The company started
its business in India in 2004 and has gained a considerable ground in the Indian chocolate industry within a decade. It is
famous for its unique taste defined by its main ingredients – creamy filling, a crunchy wafer and a hazelnut centre. Ferrero
India was the third biggest chocolate brand in India as it held 5% market share in 2014.

• Amul- It is India's indigenous dairy cooperative primarily dealing in dairy products. It is also one of the biggest players
involved in chocolate manufacturing industry of India. Amul is owned by Gujarat Co-operative Milk Marketing Federation
Ltd. The credit of making India the largest producer of milk and dairy products by bringing about the 'White Revolution'
goes to Amul. Milk chocolate is Amul's most trusted brand amongst Indians. Accounting for 1.1% of India's overall
chocolate sales volume in 2014.

• Mars India International-Mars was established in 1911 by Franc C. Mars in Washington, U.S.A. The first recognised brand
of Mars was Milky Way that was launched in 1920s. Mars has been popular in India as well. Very recently, Mars has
started its manufacturing in India. Snickers and Galaxy are the most popular chocolates in India that are made by Mars.
The company was the fifth biggest seller of chocolates in India in 2014 as it got 1.1% share of the total sales.
 TARGET MARKET
Cadbury brand’s Dairy Milk chocolates targets kids within the age group of 5 to 10 years. This is because,
consumers of this age group are expected to prefer chocolates than other confectionary and best satisfy their needs.
Over the years the target consumer groups of Cadbury brand’s Diary Milk products has shifted from kids to adults
that includes all the family members those can celebrate any festival with these chocolate products.

For this reason Cadbury has developed a campaign “Kuch Meetha Ho jaaye’ for creating its image as a sweet that
could target chocolate loving consumers of all age groups.
Cadbury has targeted those consumers who celebrate special occasions by gifting sweets in attractive packaging.
For attracting this target consumer group, premium packaging of Dairy Milk chocolates is done and gift boxes with
all dairy milk product ranges are made available to its target consumers.
 CURRENT IT USAGE
• The company has built in a robust regular feedback system to monitor the changes and
check if they go according to the initial plan. The entire implementation is cross functional and
hence it is important that there is a high increase in the efficiency.

• Cadbury is using a lot of digital platforms for the marketing and promotion of their brand. Some
Examples are:

 TWITTER: Cadbury’s are pretty good on social media, particularly on Twitter, where they are posting on a
regular basis and interacting lots with their followers. Though there is a lot of duplicated content
across platforms and pages, this is understandable and it broadens the reach to different audiences.

 FACEBOOK: Considering Cadbury have their biggest Facebook following on their Cadbury Dairy
Milk page, with 11 million followers, I feel that they could benefit from a bit more consistency in their
updates, as sometimes a week can pass without them sharing anything.
 ERP IMPLEMENTATION
• Cadburys India was the very first organizational unit allover the world to implement ERP in its processes.

• The implementation process in India was started from scratch as they were the first to implement that in
allover global application of the Cadbury. They tried to inculpate the best practices of the company and tried
to build on the strengths the past systems in new ERP systems.

• Cadburys knew that for implementation will they will be standardizing the processes in 16 different locations.

• The ERP initiative was to bring about a complete integration of the major processes in the business. The
major processes being procurement system, finance system, the Human Resources and other departments.
• These were functioning in a completely decentralized manner.

• Cadburys have four branch operations and 13manufacturing operations and each had their own systems
running in isolation.

• The finance department was the only one common to all.

• ERP served as an integrating system and a solution for their then existing decentralized model.
 • Initially Cadburys went with Finance and then subsequently to production and supply chain. They went for a
function based big bang approach in India and then implemented the whole module all across company in
span of 1 year so it can be said as big bang as whole.

• It was completely top management driven. Cadburys have a proper MIS now. Data is entered only once. The
entire system gets updated. One can see the consolidated data from anywhere and make decisions. From
manual entries it has become a totally system driven data entry now.

BENEFITS:
• Cadbury had operations in 16 locations and 26 depots and all of these were highly decentralized.
The management was looking at ways to sort internal problems and this is where SAP had come to
the rescue

• Cadbury was on a fast paced growth and could not continue with the existing systems and the pace
was too slow due to added inefficiencies down the chain. ERP implementation handled all the issues
and added efficiency and guided the fast paced growth

• Cadbury standardized the processes within the 16 locations there by benchmarking the best
practices in the locations and having a marked increase in the efficiency by bringing all the locations
to the same page and the best page.
• The implementation of ERP brought in a new way of warehouse management system and brought in
structure to branch offices and the depots

• They have a portal called vendor connect where they can see inventory movement and plan
accordingly hence it add on to the benefits as this give a clear cut idea not only from internal system
but across to the suppliers. Company also built in a robust regular feedback system to monitor a
change and to check if they go according to the initial plan.

• The manufacturing in itself had 13 operations and each was operating in a silo. This had increased the work in
progress and the integration of the processes has done well for the company

• While implementing the ERP systems, the company has built it upon the past strengths of the company thereby
not losing out on its competitive advantage and at the same time saddling itself up for a fast paced growth

• The initial implementation took time and then the successive implementations took lesser time and cost and
there is a huge advantage in saving cost while in the implementation phase itself

• The reaction from competition does not matter in this because this is not a change that was advertised to the
market. This is an internal process restructuring and was a welcome change within the company which badly
needed the change
 OPERATIONAL BENEFITS
• There is increase transparency in the organization though there is authorization involved. This helps to keep
the people in the same page and ensures proper integration

• The company achieved 70% automation in processes and has not eliminated any process specifically

• The company has a proper MIS (Material Information System) because of this implementation and the entire
process is top driven

• The jobs were classified into complexity base and the high complex jobs were targeted and automated.
No manpower elimination took place. Instead the company hired manpower

• Bill material, automation and integration happened from completely manual process. Booking of the finance
entries, bill material receipts and inventory getting updated, The real time data was made available to
the company wide function for e.g. for production function the end of shift data is available, for finished goods
inventory the inventory levels at all our depots reflects on portal.

• A new stock accounting system has been put in place which takes care of freshness of the product