The firm now plans to expand its value-added bakery portfolio that it ventured into recently
“While share of the bakery segment in our India business remains low, we recently launched two products and entered into the cake category,” Deepak Iyer said
Despite disruption in business in the past few months, Mondelez India is gearing up to revamp its operations. The country’s largest chocolate maker is expanding its portfolio in bakery, rationalising its shelf-keeping units (SKUs) and improving direct reach in search of growth.
The firm now plans to expand its value-added bakery portfolio that it ventured into recently. According to Managing Director Deepak Iyer (pictured), its focus will remain on establishing its brands in the segment and Mondelez is focusing on the bakery market for the long haul. “While share of the bakery segment in our India business remains low, we recently launched two products and entered into the cake category,” he said.
Further, to bring agility into its portfolio, the company is undertaking an overhauling exercise for its SKUs. The plan is to weed out less effective packs and replace them with more suitable SKUs, based on learnings from consumer insights.
It has adopted a two-pronged strategy and plans to focus on both premium and entry-level segments of the market. In India, majority of the packs of chocolates that are sold are priced at Rs 10 or below and Iyer does not want to miss out on that.
Its premium portfolio is, however, what delivers it the margins. In line with the industry trend, Mondelez has ramped up premium play – launching close to half a dozen products in the category. Nestlé, Fererro and Hershey have all introduced global premium offerings in the market in the last 18 months. ITC, too, forayed into the chocolate market with its luxury range of Fabellle brand.
Mondelez’s efforts have paid off so far. Data from Registrar of Companies, in FY19, show its operating revenue grew 9 per cent to Rs 6,746 crore, while its net profit grew 42 per cent to Rs 462 crore year-on-year – expanding its net margin by 160 basis points.