Summary: The case examines the challenges and strategies involved in introducing a new FMCG product, such as milk, in remote areas. The focus is on creating differentiation by addressing supply chain dynamics and leveraging local resources. Practical solutions include reducing the supply zone by acquiring raw materials locally, employing targeted marketing, and using local influencers to foster habitual product use. Price adjustments and quality improvements are also recommended, but price alone should not be the differentiator. The study highlights unethical PR practices as a last resort under pressure, though these carry significant ethical and legal risks. Observations from rural localities like Amai and Dhani in Rajasthan underscore the importance of managing raw material supply and fostering relationships with suppliers. Creating a void in the raw material market can be pursued through awareness campaigns, business process integration, or a mix of both. Each approach requires careful consideration of operational and bureaucratic challenges. The solution proposed is sensitive to execution and tailored to local conditions. The disclaimer emphasizes that these views are personal and may not align with practical scenarios, encouraging readers to engage critically with the ideas.
Case Problem
Inclusion of a New Fast Moving Consumer Goods (FMCG) Product in a Remote Area
Opinion
Let us Trickle Down this approach to a single SKU or a FMCG Product to get a better and detailed understanding.
Take a product which seems and had a track record of impeccable in remote areas i.e., Milk
(which are abundant in that zone and in less demand plus huge supply).
This is like same as supplying a Powerhouse, the Raw Material.
Wide-Terminological Solution is creating the product differentiated with respect to competitor. But in what aspect?
A few of possible practical scenarios and methodologies may be –
1. Reduce the Supply Zone by purchasing out the Trickled-Down Bottom-Level Raw Material from that territorial target.
2. Targeted marketing methodologies.
3. Individual local influencers to align and make Habit for long.
4. Reducing or comparable price with respect to original product but not to be an alone differentiator and to be introduced along with the above all factors mentioned.
5. Enhance or make quality at par/comparable/better with respect to the original SKU/Product.
6. Unethical Methodologies – Unethical PR Methodologies/Practices may be used which have proved to be very influential but again are Unethical, but need to introduced only under the pressurized sales and may be during a habitual change for a Societal Growth/Impact which may also attract some serious Legitimate Implications
Okay, if we attempt to purchase the raw material from entire territory, it will be a hard to surveillance all the stakeholders to keep sustainable amount of it to themselves and took out profits from the major chunks.
Our attempt is to create a whole void in raw material segment for this territory.
1. First step is to create awareness in the territory but generally takes more time but less money comparatively.
2. Second step is to funnel the entire business cycle process to bug outs the raw materials for them and synergize with our business cycle to create a void and requires the less time but monetary amount for the entire process.
3. Third step is to create a mix of both and seems to be more of an Economical and Viable solution but is very Sensitive to execute.
Practical Observations
Let us take the story of ‘Amai’ locality in Rajasthan and ‘Dhani’ locality, a village in Rajasthan too. Their story and observation resembles that there are a few families who owns the Raw material to create a supply in that zone (Milk here is the case). Creating a 100% void is the ideal task to have. The 99% is still possible due to the fact that the Supplier/Producer himself may choose to keep the Product/Supply for himself/personal use and may sell out the entire Inventory/Supply to the business.
The pre-requisite for this creativity is to clear the 2 Bottlenecks (Major Ones) that are –
1. Business Operations and Bureaucratic Functions.
2. Depending upon the Supplier’s Relations.
Disclaimer : The above stated Case Problem and Opinion are subject to personal views and approach from a Layman’s point of view and may not stands pragmatic in real world scenario and thus may differ from person to person in their way of solving it. Enjoy the joy of writing and a stimuli of brain to it.
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Author: Deepak Sharma | BSc. Physical Sciences (DU), MA Economics (IGNOU), PGC Strategy (IIMB)
Author Bio
