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TABLE OF CONTENTS
CONTENTS
PAGE NO
1. 2. 3. 4. 5. 6. 7. 8. 9.
Table of contents History of bottled water industry in India Why bottled water started? Players in bottled water industry Rail Neer Distribution Way to increase market share Future planning Competitors
1 2 2 3 4 9 10 11 12 13 14 15 16
10. Findings 11. Conclusion 12. Recommendations 13. Bibliography
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History of Bottled water in India
Mineral bottled water in India under the name 'Bisleri' was first introduced in Mumbai by Bisleri Ltd., a company of Italian origin in 1965. Mineral bottled water were in glass bottles in two varieties - bubbly and still in 1965 This company was started by Signor Felice who first brought the idea of selling bottled water in India. Parle bought over Bisleri (India) Ltd. In 1969 and started bottling Mineral water in glass bottles under the brand name 'Bisleri'. Later Parle switched over to PVC non- returnable bottles and finally advanced to PET containers. Since 1995 Mr. Ramesh J. Chauhan has started expanding Bisleri operations substantially and the turnover has multiplied more than 20 times over a period of 10 years and the average growth rate has been around 40% over this period. Presently it has 8 plants and 11 franchisees all over India. Bisleri command a 60% market share of the organized market. Currently, Bailley has a national presence in 5 lakh retail outlets across the country. We plan to increase manufacturing plants for Bailley from 29 to 60, presently 40 plants are operational and few more will be ready for operations over the next few months, informed Nadia Chauhan, joint managing director of Parle Agro.
Why Bottled Water Started?
Millions of people, both in rural and urban India, suffer from inadequate or no tap water supply. Even some parts of Mumbai, the country's financial capital, get a mere two hours of daily water supply. The city's Virar suburb gets 45 minutes. So bottled water is much in demand by residents - even though the businesses
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profiting from the sales are thriving from access to public water sources. Bottled water fills a void created by government failure to address basic services, Peter Gleick of the Pacific Institute writes in its World Water report. "In many parts of the world, tap water is not available or safe to drink," writes. "In these regions, the failure of governments to provide basic water services has opened the door to private companies and vendors filling a critical need, albeit at a very high cost to consumers." The institute reasons that governments should tap into spending on commercial water by consumers to secure funds to provide safe water at fraction of the cost.
Players in Bottled Water Industry
Coca cola Pepsi Nestle Mount Everest Manikchand Kingfisher Mohan Meakins SKN Breweries Indian Railways
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Rail Neer
Introduction: To enhance passenger amenities, the IRCTC launched Rail Neer, a branded packaged drinking water for the rail commuters. Rail Neer is processed, purified and bottled at state-of-art plants. Completely automatic plant and no manual handling of product water at any stage. IRCTC stands for quality and has a key role in ensuring service and product of the highest quality for the rail passenger as well as visitor to any railway premises. High quality product can only be ensured when production is in-house under full control and supervision of IRCTC.
Rail Neer Plants: Nangloi (Delhi): This is the first plant set up by IRCTC in 2003. This is located in West Delhi. The purpose was to supply safe drinking water to important Rajdhani and Shatabdi trains originating from New Delhi and Nizammuddin. Plant is provided with solar evaporation pits. This is to avoid RO reject to surrounding land and hence comply with state Pollution control norms. Establishment May 2003 Project cost Rs. 10 crores Factory area 7000 sq. mtr. Production Capacity 102000 bottles/day Source of Water Ground Water Address:- Northern Railway's Wireless Station Area
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Opp. Nangloi Bus Depot, Nangloi, Delhi-110041 Tel: 25949772, 74, and 75 Fax: 25949773
Danapur (Patna): This is the second plant set up by IRCTC in 2004. This is located near Patna in Bihar. The purpose was to supply safe drinking water to trains and stations in state of Bihar and Howrah and Sealdah stations in West Bengal. Establishment March 2004 Project cost Rs. 10 crores Factory area 10000 sq. mtr. Production Capacity 102000 bottles/day Source of Water Ground Water Address Rail Neer Plant, Loco Colony, South of RPF Barracks Khagaul, Danapur Patna 801105 Ph. - 06115-232557, Fax- 06115-232557
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Palur (Chennai): This is the latest (third) plant set up by IRCTC in 2010. This is located near Chennai in Tamil Nadu. The purpose is to supply safe drinking water to trains and stations in state of Tamil nadu and Banglore in Karnataka. The plant is being setup on area of 4500 sq. mtrs. The building is constructed in such a manner that there is no need of artificial lighting during day time. The waste water discharge from Water treatment plant has been reduced to 10%. This is achieved by incorporating concepts of Secondary RO in the Water treatment scheme. Establishment Operational Project cost Rs. 20 crores (Approx.) Factory area 9000 sq. mtr. Production Capacity 180000 bottles/day Source of Water Ground Water Address Rail Neer Plant, Palur Railway Station Chengalpattu Kanchipuram Main Road Palur Village, Chengalpattu Taluk, Kanchipuram District Pin - 603 101 Ph-044-28363725
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Manufacturing process: Water drawn from bore wells is stored in an underground reservoir and pumped to the treatment plant designed, engineered and installed by M/s ION Exchange (India) Ltd., the market leaders in the field of water treatment with well over 37 years of experience. The plant technology employs 8 purification processes capable of yielding water quality conforming to BIS standard IS 14543-2004. Activated Carbon Filter; Stage 1 & 2 Stage 1 removes dust, dead microbes, odour/colour and stage 2 is for removing pesticides. Auto Softener Unit (ASF) - Hardness of water is removed by ion exchange resin. Ultra Filtration Unit (0.001 micron membrane)Colloidal, suspended particles and pyrogenic species are filtered out through Ultra Filtration membranes. Reverse Osmosis (membrane 0.0001 micron) All dissolved impurities are removed. Anti-scaling agent not used. (All competitors use it to enhances membrane life) Marble chip filter- To boost pH. Exclusive process adopted by Rail Neer. Two stage Micron Filters (first membrane 1 micron followed by 0.2 micron) - Impurities with size more than 0.2 micron are filtered out. Ultra Violet Sterilizer Unit- UV-light causes change in the genetic material of microorganisms and thus prevents them from reproducing.
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Ozonizing Unit- Water comes in contact with ozone gas for final disinfection from the microorganisms. The nascent oxygen is powerful oxidising agent and kills the microbes.
Automatic Bottle Blowing Machine: Rail Neer bottles are manufactured with automatic blowing machine (Make M/s Sidel India Ltd) at plant with high grade resin performs. Preforms are made only with HUSKY or Krosmafi machine. Automatic Rinsing Filling & Capping Machine: Bottle blown at blowing machine travels through air conveyer to automatic Rinsing Filling & Capping machine (Make-M/s HiMech) where bottles are rinsed in inverted position by very high pressure jet and water is completely drained out as bottle is inverted then it get filled with the help of nozzle and passed to capper where the same get capped. The temperature of filling area is kept at 20 degree centigrade and this area is completely enclosed and restricted area and no one except filling operator is allowed to enter the area.
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Distribution
The Rail Neer is being distributed to various Railway stations through selected CFAs (carry and forwarding agencies) under supervision of IRCTC. All Rajdhani & Shatabdi trains originating Delhi have been declared mandatory for Rail Neer. Further some mail/express trains are also declared mandatory for pick-up of Rail Neer. Rail Neer is also supplied to PMO, MEA canteen and Railway Board. SN Location of CFA Stations where Rail Neer is supplied (Declared Mandatory) 1. Delhi- New Delhi, Delhi, Nizammuddin, Sarai Rohila, Sakur Basti, Kishan Ganj, Subzi Mandi, Delhi Cantt. 2. U.P. - Ghaziabad, Saharanpur, Jhansi, Agra Cantt. , Etawa, Bareilly, Mathura, Tundla. 3. UttarakhandDehradun, Haridwar, Kathgodam. 4. Rajasthan- Jaipur, Jodhpur, Bikaner, Ajmer, Phulera, Alwar. 5. Jammu- Jammu. 6. Haryana- Ambala, Kurukshetra, Kalka, Chandigarh, Yamuna Nagar. 7. Punjab- Ludhiana, Jullundhar, Pathankot, Bhatinda Amritsar. 8. Bihar- Patna, Hajipur, Danapur, Darbangha, Muzaffarpur, Rajendra Nagar, 9. Jharkhand- Dhanbad, Hatia, Ranchi, Tatanagar. 10. Urrisa- Berhampur, Bhubneswar, Puri, Cuttack, Rourkella, Khurda 11. Assam- Tinsukia, Guwahati. 12. West Bengal- Howrah, Adra, Bandel, Bankura, Bishnupur, Malda, Durgapur, Garbeta, Purulia and Santhali
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Way to increase market share
1. The market share of a product can be modeled as: Share of market= share of preference*share of voice*share of distribution According to this model there are three drivers of market share Share of preference Can be increased through product, pricing and promotional changes. Share of voice The firms proportion of total promotional expenditures in the market. Thus, share of voice can be increased by increasing advertising expenditures. Share of distribution can be increased through more intensive distribution. From these drivers we see that market share can be increased by changing the variables of the marketing mix. Product- The product attributes can be changed to provide more value to the customers, for e.g. By improving product quality. Price- If the price elasticity of demand is elastic (that is >1), a decrease in price will increase sales revenue. This tactic may not succeed if competitors are willing and able to meet any price cut. Distribution- Add new distribution channels or increases the intensity of distribution in each channel. Promotion- Increasing advertising expenditures can increase market share, unless competitors respond with similar increases. 2. By increasing the Market area of Rail Neer. 3. By giving more incentives to retailers.
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Future Planning
There is huge requirement of packaged Drinking on IR. At present the two regular plants at Nangloi and Danapur are able to cater less than 5% of the demand. The third plant of 15000 cases per day or 1.6 lakh bottles per day operational at Palur (75 kms from Chennai Central station in Tamil Nadu).This will take care of requirement of PDW in trains originating from Chennai and Banglore. Ministry of Railways has decided to set up six packaged drinking water plants under PPP mode. a) To meet the demand of PDW in western part of the country or say for Trains originating from Mumbai area stations, a fourth plant has been planned at Ambernath, Maharastra. This is situated near GIP Lake in Additional MIDC area located about 70 kms from Mumbai Central station. Key parameters of the proposed plant are: Area: 20,000 sq. mtrs. Estimated Cost: Rs. 20 cr. Installed Capacity: 17000 cases (Two lakh bottles) per day with Provision to upgrade to 25000 cases (Three lakh bottles). b) In order to meet further demand of PDW on IR, it is proposed to setup more plants involving private organisations on PPP model. Some of the locations identified are Bhopal/Nagpur, Ahmedabad, Bhubneswar/Cuttack and Hyderabad. After fructification of all these plants, IRCTC would be able to strengthen its supply logistic at all important Railway Stations, Rajdhani, Shatabdi, Durante, Garb Roth and other Mail/Express trains across India. c) To increase bottling capacity, IRCTC is in process of setting up Joint Venture with participation from Private Industry. The Joint
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Venture firm will set up more Packaged Drinking Water Plants across the country. Two potential sites identified, are at Nagpur and Hyderabad. Aim of IRCTC is to be known as No. 1 packaged drinking water bottler for supply on Railway premises.
Competitors
Mount Kailas Iceling Bisleri Mc. Dowells Aquafina Sudh
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Findings
No advertisement No Promotional activities Less profit margin to vendors as compared to other brands Due to the government intervention it is lesser known brands
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Conclusion
After study about Rail Neer & its market share, we can say that Rail Neer is a lesser known brand despite of government support. IRCTC should take some action about Promotional activities & market area.
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Recommendation
To start promotion activities To sell the product in the open market The company should curtail its profit margin & should give more profit to the vendors so that they would sell Rail Neer more in comparison to other products. Government intervention should lower. We should create awareness and run advertisement to support the brand.
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Bibliography
Book: Marketing Management -Philip Kotler
Websites: www.gits4u.com/water/water16.htm www.irctc.com/rail_neer.html www.irctc.com/introrail_neer.html
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