Since the Rs 9,000-crore biscuit market witnessed a growth of 20% last year and is slated to sustain its growth this fiscal, ITC is looking at enhancing its biscuit manufacturing capacities by at least 15-20%, primarily to manage supply chain costs and improve profitability. “We plan to set up additional capacities in such areas where we have developed a significant front-end scale, but are limited by proximate capacities. Attempts are being made to create new biscuit variants in segments that are relevant to the consumer. The positioning of the marketing mix is also being worked upon to drive consumption by creating convenient price points or by differentiating product propositions,” Mr Chitranjan Dar, chief operating officer, ITC Foods Division, told ET.

For starters, ITC plans to drive growth by vitalising its brand ‘Sunfeast’ through product innovation, contemporary packaging and targeted brand communication. A huge investment is also being planned for brand building and product development. At the same time, the company is looking at investments in building trade loyalty across channels and markets.

Elaborating further, Mr Dar said, “while ITC per se has no plans to rationalise its biscuits portfolio, we review the basket from time to time. Additions or deletions takes place on the basis of the market feedback and actual sales. The idea is to strengthen the winners and replace the average performers with potential winners from the biscuits stable. As of now, there is no product which does not contribute positively to the overall pool of contributions.”

Incidentally, a large proportion of the growth in the biscuits segment is coming from the mid-price offers growing at 35%. The mid-price offers is the non glucose segment and includes cookies and sandwich cream products.

“There are clear indications that consumers are upgrading to mid-price offers in line with the growth of packaged foods in the country. Since consumers are ready to pay for good quality and tasty products, we find a growing value for product quality and hygiene. Hence, our capacity additions will partly be in line with these requirements Mr Dar pointed out. The basic product glucose, however, continues to be largest category in terms of volumes.

The acquisition will significantly bolster Menicon’s retail presence in greater Tokyo, the world’s largest metropolitan area, and will expand opportunities for Menicon to reach users who do not currently use Menicon products. W.I. System stores will continue to provide a broad array of lenses and lens-related products from Menicon and other manufacturers to meet the diverse needs of Japan’s contact lens wearers.

Menicon believes that by striving to satisfy its newly expanded customer base as a result of the acquisition, the experience ultimately will strengthen the company’s and the industry’s capabilities for developing and marketing lenses and lens care products that meet diverse needs in the broader global market.

“W.I. System strives to provide highly satisfying customer experiences when people in need of vision correction visit any one of our many conveniently located shops throughout the greater Tokyo area,” said W.I. System president Keizo Takahashi. “As a new member of the Menicon group, we look forward to expanding and strengthening our customer relationships over the long term.”

“I have great expectations that this integration between our well-known companies will encourage more people to experience the joy of wearing advanced lenses, and allow us to further contribute to eye safety and comfort in Japan, and ultimately in markets around the world,” said Menicon president Hidenari Tanaka.

About W.I. System W.I. System operates 68 Tokyo-area retail stores and one franchise store that do business under the name Ace Contact or Ekicon. The stores offer primarily contact lenses, and also sell eyeglasses, hearing aids and nutritional supplements for pets. Established in 1989, W.I. System recorded sales of JPY 10.3 billion (USD 130 million) in the fiscal year that ended in May 2011.

About Menicon Headquartered in Nagoya, Japan, and represented in over 40 countries, Menicon is a global contact lens company dedicated to every aspect of the field from material development and lens design to manufacturing of lenses and lens care solutions. Menicon offers an expanding portfolio of innovative lenses, packaging and related products that maximize user comfort and convenience. 2011 marks Menicon’s 60th year in business. For more information, please visit http://www.menicon.com

SOURCE: Menicon Co., Ltd.