Case Study On Potential Markets For Chili Powder In Unorganized Sector In Gujarat (FMCG)

BACKGROUND

A leading player in the spices industry aimed to understand the potential markets for unbranded chilli powder in the unorganized sector across rural and semi-urban areas of Gujarat. This research was conducted by Maction Consulting Pvt. Ltd. and involved detailed studies of wholesalers, retailers, and grinders.

OBJECTIVES

• Identify potential markets for chili powder in the unorganized sector.
• Understand the supply chain drivers for chili powder in the unorganized sector.

METHODOLOGY

The research involved both primary and secondary data collection methods:

• Primary Research: Quantitative research using CAPI/Face-to-face interviews with wholesalers, retailers, and grinders.
• Target Groups: Wholesalers and retailers selling unbranded/loose chili powder, and small and medium grinders.
• Sample Plan: Surveys were conducted across 30 districts of Gujarat, excluding The Dangs, Panch Mahals, and Dohad.

 

Findings

1. Wholesalers’ Insights

1. Profile: 275 wholesalers were interviewed, most handling less than 5 tones of chili. They preferred varieties like Kashmiri and Resham Patto.
2. Sourcing Practices: Majority sourced chili powder from suppliers/traders. Quality, regularity, and customer service were key factors in supplier selection.
3. Purchase Behavior: Preferred Kashmiri Resham Patto and Tomato varieties. Monthly procurement was common.
4. Sales Trends: 33% reported increased sales, while 21% saw a decrease. Major sales months were April, March, and May.
5. Customer Types: Main customers were household consumers and small retailers, with some sales to the hotel and catering sectors.

2. Retailers’ Insights

1. Profile: 300 retailers were interviewed. Majority sourced chili powder from suppliers/traders.
2. Purchase Frequency: Varied from weekly to monthly. Quality and freshness were critical aspects in their purchasing decisions.
3. Sales Trends: 40% saw an increase in sales. Main customers were household consumers.
4. Supplier Satisfaction: 65% were satisfied with their suppliers. Issues included price fluctuations and payment terms.

3. Grinders’ Insights

1. Profile: 150 grinders were interviewed. They primarily sourced raw chili from suppliers/traders.
2. Grinding Practices: Frequency varied, with many grinding chili powder as per requirement.
3. Sales Trends: 45% reported steady sales. Main customers were retailers and household consumers.
4. Challenges: Issues included price changes, quality of raw materials, and timely delivery.

 

CONCLUSION

The study highlighted significant trends and insights in the unorganized chilli powder market in Gujarat:

• Supplier Loyalty: Most wholesalers and retailers were satisfied with their current suppliers, citing quality and regular service as key reasons.
• Market Trends: Sales were generally stable, with some regions reporting growth. Household consumers were the primary customer base.
• Challenges: Price fluctuations, quality issues, and payment terms were common challenges faced by wholesalers, retailers, and grinders.

 

RECOMMENDATIONS

• Supplier Improvements: Suppliers should focus on improving packaging, reducing prices, and ensuring timely delivery to attract new customers.
• Market Penetration: Reducing prices in the southern region could help capture the hotel and restaurant sector.
• Supply Chain Efficiency: Addressing issues related to price changes and quality of raw materials can enhance satisfaction among wholesalers and retailers.

 

ABOUT THE CLIENT

The client has been a pioneer in bringing Indian spices to global markets, following the philosophy of reaching customers’ hearts through their taste buds. The company continues to innovate and expand its product range, aiming to maintain its legacy of fine taste and immense love.

For more details, please contact  info@maction.com