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Rean Juice

In: Business and Management

Submitted By sachinleo03
Words 1441
Pages 6
Traditionally, the Indian life style has a predilection for fresh fruits and vegetables or those processed at home. There is a sea change. People, are now increasingly going in for fresh fruit vending from kiosk fountains, which produce instant juices from fresh fruits in the presence of the consumer. It could be due to the non-availability of hygienically produced and well-preserved products with the use of preservatives. That is why some of the real but branded fruit juices launched in the late 1980s and early 1990s did not succeed. There has been a steady rise in the capacity, production and capacity utilisation in the fruit processing units. The processing capacity had gone up from 0.9 mn tonnes in 1990-91 to 2.1 mn tonnes in 1999-00. The capacity utilisation improved from 31% to 47%, with the production in 1999-00 estimated to have increased to 980,000 tonnes. The official reports do not show any substantial increase in total output although branded drinks do show a healthy improvement. There is no general acceptance of the product forms in the fruit drinks market. The consumer is basically concerned that it is a fruit juice and not a synthetically constituted product. Accordingly, the first segmentation is between real fruit drinks and synthetic drinks. The former are based on natural fruit pulp or juice. The others are synthetic products containing fruit flavours. Among the fruit juice beverages are fruit juices (Pepsi's Tropicana), nectars (Dabur's Real) and fruit drinks (Frooti and Slice). All these are real, reconstituted from fruit pulps or concentrates. The leading fruit juice brands include Real, Onjus, Tropicana, Frooti, Jumpin. The fruit drinks are mainly based on oranges, mangoes, pineapples, grapes, apples, guava and tomato. They only differ in pulp content: the juices have over 85%, nectars (20% to 85%) and fruit drinks (less than 20%). The branded fruit juices market inclusive of nectars is placed at about Rs 10 bn. The pure fruit juices are the preferred drink among the fruit drinks. This segment is growing at around 10% annually. The market for fruit juices is expected to grow to Rs. 7.50 bn by end 2009-10 from nearly Rs. 4.75 bn presently. Consumption per capita of juices in India is very low. It is estimated at a fraction of a litre - 20 ml. China has attained a consumption level of 1500 ml. The consumption in India is basically an urban phenomenon. Nonetheless, it is gaining slow but steady penetration into the rural areas. The early development of juice processing was led by co-operatives and other processors in the fruit-rich states of Himachal Pradesh and Punjab. The canned juice segment covered brands like NAFED, Noga, Midland, Gold Coin and Druk. These were fruit juices or nectars - not drinks. These did not make a mark in the market for whatever reasons: high price, unattractive packaging, and lack of right promotion programme. A bulk of juice consumption came from institutional commercial buyers. There was a sizeable export of mango pulp. It is now getting into the retail marketing basically as a funfood, often as a substitute for aerated and cola drinks. In the area of packaging, Tetra-Pak India, a part of the $ 10 bn Tetra Laval group, has become the major source of brick cartons amenable to aseptic packaging and imparting long product shelf life to the foods. Tins, nonetheless still continue to be in the market in family size packings. A perceptible change came in 1996 with the introduction of Real juice in aseptic cartons from Dabur Foods. Packaged in tabletop packs from Elopak, Norway, the juices were claimed to have a six-month shelf life. Real fruit juice is the first brand in Asia to use the latest Spin Technology developed by TetraPack. It is available in five flavours - orange, mango, pineapple, mixed fruit and tomato. It also plans to export Real to South East Asia, Bangladesh and Sri Lanka. Enkay Texofood Industries entered the market with what is claimed as 100% natural orange juice in India with Onjus brand. Enkay happens to be the largest Indian exporter of fruit juices, pulp and concentrates to Europe and North America, with clients such as Unilever, Coke, Pepsi and Nestle. The company's plants near Vapi in Gujarat have been producing daily 80,000 packs of 250 ml and 70,000 packs of one litre of Onjus. By the end of 1999, Onjus had captured at a point of time third of the juice market. Until the advent of Tropicana, Real remained a premium product. Dabur Foods marketing strategy paid off until Onjus was sold at almost half the Real's price and claimed to be a 100% natural drink. Tropicana Product, a division of PepsiCo, entered the Indian market. For the Indian markets, Tropicana developed a sweeter blend of orange and white grape. Tropicana was planning to enhance its market share in the fruit juice market and to increase its turnover to Rs 1000 mn by 2002-03. PepsiCo International is planning to make India a regional sourcing hub for fruit juice concentrates and pulp. Pepsi Foods is already exporting nearly 20,000 tonnes of mango pulp and concentrate mainly to West Asia and Europe. It has launched a new mango juice and was to introduce guava and litchi variants. The segment has been witnessing some feverish developments. Pepsi was exploring the launch of a new brand in the segment the first international juice brand in the category launched in India. It had already decided to launch other flavours of Maaza and beverages like iced tea and coffee. It is planning to repack its five-flavour offering for the Indian consumer. The company stopped the production of the 250 ml pack. The new flavour - sweet orange - was being targeted at customers who were not used to the regular orange flavoured juice, which Tropicana sells worldwide. While Tropicana came up with mixed fruits, Pepsi ventured into slice mango juice in Tetrapak along Tropicana. Tropicana also explored the possibility of local production of juices from mango. It planned to source raw processed fruits, such as apples from Himachal Pradesh, grapes from Sholapur and tomatoes from Punjab. Dabur Foods has launched Real Junior, a 125 ml pack of apple and mango drinks for children below 6 years of age. The company has also started test marketing of tomato soup under the homemade brand. Dabur Foods, a Rs. 860 mn company, is planning to achieve a sales turnover of Rs. 5 bn in the next five years. During the period 2003-04, the company, for the first time since its spinning off into a separate company, logging a net profit of Rs. 150 mn on a turnover of Rs. 850 mn. Coca-Cola and Procter & Gamble were contemplating a stand-alone juices and snacks company. Coke had a setback in its deal with Quaker Oats, owner of sports drinks, Gatorade, being acquired by Pepsi. Coca-Cola was introducing powdered drink concentrate Sunfill Fresh, especially in the rural market place. Pioma Industries, the maker of Rasna brand of soft drink concentrate, was negotiating a joint venture with Del Monte Foods of the USA. Del Monte is the largest producer of canned fruits and vegetables in the US. Rasna has set up its first production unit in Himachal Pradesh, with an installed capacity of 350,000 cases a year. The company has plans for setting up two more units with a combined capacity of 600,000 cases a year. To increase its market share the company is planning to introduce local flavours like shikanjvi, aam panna, and jal jeera. Rasna sachet sales have grown to contribute 30% of its sales in terms of volume. Rasna International is set to face renewed competition from the relaunched Tang brand from Kraft General, which is now a part of the Philip Moris group. The international brand was launched earlier in India by Kothari General Foods. The Prakash Chauhan-controlled Parle Agro was to launch two new fruit beverages, besides widening its product portfolio by getting into jams and ketchups. The poduction units were planned in Maharashtra. The company slashed the prices of Frooti and Appy to gain market share. Merisant India, a subsidiary of Merisant USA and makers of Equal, the low calorie sweetener, has introduced a powdered soft drink under the brand, Fix, in the Indian market. The drink is low in calories and will be sold in different flavours - peach, orange, mango, pineapple and lemon.
Leading Brands
Vadilal, Jumpin, Kissan, Real, Onjus, Kool Kokum, Frooti, Appy, Joly Jely, Yo Fruity, Noga, Midland, Goldcoin, Druk, Tropicana.

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