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Arun Ice-cream

Parent company

Hatsun Agro Products Ltd

Category

Food processing

Sector

Food and Beverages

Tagline/ Slogan

Lifes Happy moments

USP

Exclusive franchise parlors in India

Segment

Ice-cream for Quality conscious kids


and adults

Target Group

Kids and youth

Positioning

Exceptional service through exclusive


franchise parlors

History and strategy:


Established by R Chandramogan, son of vegetable

wholesaler from Tamil Nadu.


The suggestion given by his maternal uncle- he went for the
ice cream business.
Chandramogan started its business into ice-creams from a
small room in 1970 next to his uncles textile shop.
Up market segment was dominated by the leading BrandsDasaprakash, Joy, Kwality.

He started with a small premise in busy locality of Madras with

which he got succeeded and moved to three fold expansion in just


second year of its commencement and delivering the customers
fresh ice-cream from the factory Arun banged the profit of 40,000
in the first year of its business.
The fact that one could get fresh ice candies right across the
factory counter - major selling point in promoting in-factory sales.
With sharply increased costs & sales not keeping pace, Arun fell into
the red: Input costs were rising sharply and manufactures decided
to increase the retail price from 10 paise to 15 paise a piece but
Arun remained sticked to their decisions, vendors slowly began
returning to the fold.
Arun upgraded the product quality and supplied homogenized ice
cream and also increased the range of product offering and flavors.

With vastly improved quality and larger number of flavors

in its offering, Arun was able to break into the tough


hotel market.

Enrolled with Davars college, an institution offering

specialized short duration programs for working


executives, and took courses in marketing and personnel
management.

Market for ice-cream in madras city & Aruns search for


a niche:
Implementation of Cold Chain Model.
Arun captured 5% of the market that includes two segments:

1. Educational institutions.
2. Supplies to ships calling at the Madras Port(ship chandler).
The rest 95 % of the total Madras market, represented by other three

segments:
1.General provisions and departmental stores with deep freezers.
2.Hotels and Restaurants.
3. Social events, mostly wedding parties.
This market was occupied by other big banner competitors
(Dasaprakash, Joy, Kwality).

1. Educational institutions:
Typically the college canteen and the hostel mess was virtually

ignored by the leading ice-cream manufacturers such as


Dasaprakash and Joy.
He started with IIT Madras and went on signing contracts from
different places and felt that college students were more than
willing to experiment with a new brand or new flavors.
2. Supplies to ships calling at the Madras Port(ship chandler):
He accepted the JIT concept: particular about delivery of icecream just in time for onward transshipment to ships.
Chandramogan felt that this segment while fastidious about
Quality, was not that brand driven.
Arun tried to also capture the interior market of Tamil Nadu :
Ice-cream majors of the time practically ignored the district
towns because of sheer logistics problems.

Brand & Promotion Strategy


The main advertisement were newspapers & magazines but now the

brand Arun was heavily promoted through colorful banners, posters


or flyers and even began investing in technology as well.
They focused sales promotion activities :1. Eat All You Can ice cream mela scheme
2. slow speed driving competition scheme
3. Phone and Have an Ice-cream scheme
4. The Home delivery scheme

Approach To Pricing & Franchisee Management


Approach to Pricing:
Followed a Cost Plus Approach.
Decided to follow a single-tier distribution strategy,

directly supplying ice-cream to the point of retail


customer sales.
Then three-tier distribution structure, added
substantially to their overall cost of distribution in
areas such as packaging, transportation and
distribution margins.
Franchisee management:
Aruns factory took orders from franchisees by phone.
Upcountry Franchisees were expected to make
advance payment by demand draft to Arun.
Franchisees were required to display in the parlors the
price list issued by Arun.

Management & Organization


Executive Director:
Chairman and Managing Director- R.G. Chandramogan.

Non executive Directors:


Ice-cream Technologist: Shankar
Stellar role in completing Salem Project- Adinarayan
Professional management team:
R.Chandramouli (financial controller& company secretory)
V.Jaganathan (Marketing manager)
Prasannakumar Menta (Head of Production)

COMPETITORS:
KWALITY in the North and the East
KWALITY and VADILAL in the West
DASAPRAKASH in South
JOY in South

SWOT Analysis
STRENGTHS:
1. Unparalleled service to customers through exclusive franchise

parlors
2. More than 70 mouth-watering ice cream flavors and

combinations
3. The first Indian ice cream brand to be certified ISO 9000
4. Attracting more children by offering various schemes along

with ice creams.


5. High quality products with good attractive packaging and

distribution.

WEAKNESS:
1.Stronger competition stifling its growth.
2. Brand visibility lower than other major players.
OPPURTUNITIES:
1. Explore the premium segment and come up with varieties,

which cater to the adult population.


2. Increase the distribution network to other parts of the
country.

THREATS:
1. Other competitor's also offering products at similar quality

and price.
2. Most people are not really brand conscious, so loyalty
might be an issue.

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