This is a question I encountered at Quora. The question asked, among snacks, confectionary, breakfast cereals, ready to eat, which category "is the best to start operations with"?
Assuming shoe-string budget, the best way is to go through process of elimination to find the most suitable one.
1. Snacks: We love our snacks. Unfortunately the market place is full. Two things win in this market:
A. Huge Media, and
B. Great distribution.
Big brands have both of these. Other successful brands have the distribution set-up. It is extremely hard to gain distribution in India for two reasons: 1. Fragmented market ( one literally negotiates at shopkeeper-level) and 2. Limited space ( groceries are already choke-a-bloke, they don't want to stock a new product which is not being heavily advertised or already have proven demand). So tough game here.
2. Confectionery: Does it mean candy? In that case, please refer to my note for Snacks. If this category meant to include bakery products, then there is some opportunity. Indians have the sweet tooth and are now aiming for western sweets. Very few quality brands exist, mostly due to the perishable nature of the products. But definitely a space if you could provide a quality. If your products are interesting enough, you will get some local distribution ( I am not assuming you are looking for national distribution for such perishable product at start-up stage).
3. Breakfast cereals: Kellogg has burnt its finger. We like our milk hot. Breakfast cereals become soggy in hot milk. If one can crack this code, he will come out winner. Else, I do not see a quality product here.
4. Ready-to-eat: People would love it if one can provide quality at a reasonable price ( reasonable price= less than half of it'd cost in restaurant). I see some good R&D investment here.
Finally among the four choices, IMHO, it looks like Confectionery has the highest opportunity at the local level.
Assuming shoe-string budget, the best way is to go through process of elimination to find the most suitable one.1. Snacks: We love our snacks. Unfortunately the market place is full. Two things win in this market:
A. Huge Media, and
B. Great distribution.
Big brands have both of these. Other successful brands have the distribution set-up. It is extremely hard to gain distribution in India for two reasons: 1. Fragmented market ( one literally negotiates at shopkeeper-level) and 2. Limited space ( groceries are already choke-a-bloke, they don't want to stock a new product which is not being heavily advertised or already have proven demand). So tough game here.
2. Confectionery: Does it mean candy? In that case, please refer to my note for Snacks. If this category meant to include bakery products, then there is some opportunity. Indians have the sweet tooth and are now aiming for western sweets. Very few quality brands exist, mostly due to the perishable nature of the products. But definitely a space if you could provide a quality. If your products are interesting enough, you will get some local distribution ( I am not assuming you are looking for national distribution for such perishable product at start-up stage).
3. Breakfast cereals: Kellogg has burnt its finger. We like our milk hot. Breakfast cereals become soggy in hot milk. If one can crack this code, he will come out winner. Else, I do not see a quality product here.
4. Ready-to-eat: People would love it if one can provide quality at a reasonable price ( reasonable price= less than half of it'd cost in restaurant). I see some good R&D investment here.
Finally among the four choices, IMHO, it looks like Confectionery has the highest opportunity at the local level.
