An Insight Into The Needs of Patanjali and Pitching in For Investment
An Insight Into The Needs of Patanjali and Pitching in For Investment
An Insight Into The Needs of Patanjali and Pitching in For Investment
investment
Problem 1
Problems
Debt-fueled expansion
Higher distribution and selling expenses
Advertising and promotion expenses
High dealer discounts can be offered on good over supplied
Problem Statement:
Patanjali is considered to be the fastest growing FMCG company in India. It
has grown from less Rs.500cr in FY12 to Rs. 10,000 in FY16. Patanjali still
faces a number of threats from its competitors and still has a long way to
go.
The continuous expansion and growth of the company has fueled the
company with the debts as the expected sales and profitability margin are
too low for the continuous growth. Expansion of the company and the
consumer base should go hand in hand. The view of the company to make
the entire nation is a time-consuming process as it requires a heavy
advertising and promotion. Not only the advertising and promotion is
expensive for the company in the period of expansion but can also harm the
company’s financial structure.
Patanjali has been traditional in reaching out to their customers by offering
heavy dealer discounts. Such discounts only accounts to more burden on
one’s self financials. It’s time that they start adapting other means to gain
access to the untapped market. The company should look for other ways to
retain their pre-existing customer base and to attract new market.
Increasing the customer base is not the only thing that the company
requires right now, a proper self-efficient system of general trade is
necessary to match the demand. The trade channels should be properly
managed and should be capable of communicating the demands of the local
suppliers to the warehouses and other suppliers.
Solutions
An internal application for Patanjali between the sales network to facilitate
them to match the demand and supply of every product on time
The consumer has the power to converse with the store owner/manager
and enquire about the availability of different products as per his/her
needs.
HIGH-DEMAND PRODUCT
In case of a high demand product, if the product runs out of stock, the
nearby consumers can be notified wo have once enquired about the
product or purchased the product.
The power of communication between the consumer and the store will
allow the consumers to know about the availability of the products in
various Patanjali stores.
The app will also allow offer discounts and coupons to the consumers, if
they decide to pay through the application.
This will not only ensure the retention of existing customers, but the
extensive marketing with the help of in-app offers and coupons will attract
the remaining market as well.
Problem 2
Opportunities
With the acquisition of Ruchi Soya, the only major competitor left for
Patanjali is Adani Wilmar with a dominion in the market, majorly in the
edible oil products.
Adani Wilmar has not implemented technology to access and communicate
to the customers.
Decline in profitability margins of Patanjali due to increase in number of
Competitors
Supply chain and distribution network unable to keep pace with the
constant expansion and development
Solutions
Peppty can serve as an internal application for employees and work within
the distribution system to keep the general trade consistent. The
application will provide the store keepers a platform to communicate with
the suppliers.
This feature will not only be limited to communication of two personnel. In
a short period of time, the app will be able to help suppliers realize the
demand of products as per the area, making the supply chain efficiently
managed.
Peppty allows the business to be self-efficient and gives them access to a
competitive edge. Adani Wilmar and none of his brands use an application
to manage the trade or consumers.
As rapidly as Patanjali is expanding, with the view to have the complete
nation as their market, Peppty will act as a helping hand as it will bridge
the supply gaps and also attract new customers through aggressive
promotions, coupons, discounts and offers.
Problem 5
Problem 6
The company’s major breakthrough is from its herbal, ayurvedic and
natural products where the company holds about 10% of the consumer
goods market. When Patanjali started to stir competition leaders like HUL
and Colgate made their move by relaunching its ayurvedic personal care
products. Patanjali also faces stiff competition from other big brands such
as Hindustan Unilever Ltd, Dabur & Colgate, ITC Ltd. The inception of GST
and the hostile takeover of rival brands led to a major setback to the
financial performance of Patanjali.
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