Bisleri and Aquafina Essay

1. INTRODUCTIONThe tradition of bottled water and mineral water is not actually old. Even in western countries the serve of bottled absorbing water started in 1950s. The trend of having mineral water gained grounds in the market. Now around 100 companies sell an estimated 424 million liters of bottled water wanted at around Rs. 200 crores in the country annually. Since ancient time people have used water from mineral springs, especially hot springs, for cleanse due to its supposed alterative value for rheumatism, arthritis, skin diseases, and various other ailments. This started the trend of using mineral water for drinking purpose to exploit the therapeutic value of the water. This trend started gaining momentum in mid 1970s and since then large quantities of bottled water from mineral springs in France and other European The concept of bottled has been sort of prevalent in western countries due to greater health consciousness and high uper awareness about health and hygien e countries are exported every year.In India, with exposure of media and international life styles, deteriorating levels of potable water, drastic increase in a number of water borne disease cases, increased in awareness about health and hygiene and other related factors led to acceptability of concept of mineral water. The market has not looked back ever since then and has grown leaps and boundary to such an extent that a number of genuine as well as fly-by -night operators have entered it to milk it. In 1967 Bisleri set up a bottling shew for manufacturing and marketing its mineral water but failed. The brand was later sold off to Parle in 1968-69. Mineral water market had its seeding as early as 1968-69 when Parle Group acquired the Bisleri brand from Bisleri of Italy for launching Soda water but later launched bottled water also.The launch at that time was a big flop as concept of buying water that too in bottled form was not accepted by the Indian public. The market remained dormant for quite long (for a period of 20 years or so). The market throughout this period was formed only by the bounteousness products that too available through 5-star hotels. In early 1990s with onset of liberalization insurance by the Indian governance, coming in of cola majors, sell off of local soft drink brands of Campa, Thumps up, Gold Spot etc by Parle to Coke and other factors led Bisleri to test waters again. Bisleri re-launched its bottled water in 1994.3. PESTLE ANALYSIS OF THE INDIAN BOTTLED WATER tipsiness INDUSTRYPolitical* There are various political parties protesting against the pricing of mineral water. * There is stable government at the centre with liberal policies. * The government has imposed price ceiling on bottled water.Economical* Increase in per capita income.* Expansion of multinationals, IT and BPO companies in Tier 1 and 2 cities.* There is no licensing policy adopted in this sector.* Availability of affordable labor.Social* Bottled water was earl ier considered as a status symbol. * Bottled water is now the only source of uncontaminated drinking water in areas where there is scarcity of water. * The bottled water is considered to be safe as compared to ordinary tap water. * There in increase in health consciousness of people.Technological* The bundling of technologies like distillation, reverse osmosis, activated carbon filter, etc helps in better quality of water. * There has been a shift in packaging from bottles made of glass to bottles made of PET. This helps in recycling and reducing environmental pollution.Legal* Governed by PFA and BIS standard. * BIS has provided standards for mineral and drinking water. The BIS approval was made compulsory from 1999. * Mineral water should be packed in clean, colorless, transparent, odorless, tamper proof bottles made up of polyethylene. * PFA and BIS lays standard for metals like lead, mercury, arsenic, aluminum and barium.Environmental* The use of credit card for bottled water increases environmental pollution. * The increase in consumption of bottled water causes depletion of valuable fossil fuels.4. INDUSTRY ANALYSIS (PORTERS FIVE FORCE MODEL)a) Determinants of entryAs the Packed bottled water is growth at the rate of 19% in India and is expected to grow from 8000 crores to 10000 crores by 2013 it is the most lucrative and fastest growing sector currently. The market capitalization is 50-50 i.e. 50% by organised shammers and 50% by unorganised players. There are more than 200 players in the discussion section1- High demand sector.2- Unorganised labour requirement.3- Absolute Cost Advantage.4- Low switching cost.5- Recession proof industry.b) Determinants of rivalryThe rivalry is not only among the head and the organised players in the sector but also among the unorganised players who are weak in brand identity. The major reasons are* Distribution channels* retailers shelf space* Price* Flexible packaging of the water to suite the purchasing power of the consumer.c) Bargaining power of buyersThe bargaining power of the buyers is very high in the B2C and the B2B segment because of the number of players present in the market. d) Bargaining power of suppliers- The bargaining power of the supplier of the raw materials to the industry is very high because of lack of substitute of the raw material. Also since the demand of the end product is very high and the industry is growing the suppliers can demand a premium for the services rendered. e) Substitution threatThough theoretically speaking there is no substitute for water but then we can say the spare-time activity can be considered as a substitute for it* Aerated drinks.* Juices5. BISLERI5.1 Brand Tagline Play SafeMission Statement To provide the highest quality product, keeping in mind all aspect including freshness, purity and safety and making it easily available to the consumer at very affordable price.5.2 Company BackgroundParle Bisleri Ltd is the biggest domestic player in s oft drinks in India. It is a private company owned by Ramesh Chauhan. The company sold off the Thumps Up and Gold Spot brands to Coca-Cola India in the early 1990s. Since then, the company has focused solely on bottled water in India. Due to the vast number of players present in bottled water in India, Parle Bisleri has seek to differentiate its brands from the competition. The company shifted its slogan from Pure and Safe to Play Safe, following the attempt of many regional players to emulate the look of the companys brands. Parle Bisleri is credited with revolutionizing bulk bottled water in India through the introduction of innovative 20-litre jar packaging. The company developed consumer-friendly packaging for its 20-litre jars by adding threaded fittings and valve caps, as remote to other brands that feature snap-on fittings. These innovations facilitated easier draining of water from the jar.5.3 HistoryThe origin of BISLERI lies in Italy and the brand owes its name to its fo under MR.FELICE BISLERI, an Italian entrepreneur. In 1967, BISLERI set up a plant in Bombay for bottling and marketing actual mineral water, which did not quite work. By 1969, BISLERI wanted to exit the business and to help him out the Chauhans bought the brand, intending to numeral it into a soda brand. Since then it has come a long way. Now, it owns a large percentage of shares in the Indian market and also it has its presence in International Water Market.5.4 ProductsBisleri offers a wide gamut of pack and price options. It offers 7 packaging options a 250-ml cup and bottles in 500 ml, 1-litre, 2-litre, 5-litre, 12-litre and 20-litre packs. The 1-litre bottle accounts for nearly 50 per cent of the sales, with the 2-litre bottle taking up 20 per cent of the sales. The remaining sizes share the balance.5.5 Production Parle Bisleri Ltd operates a ne iirk of 55 plants spread across the country. This ensures an large reach for the companys products. The company reportedly has plans to increase production capacity further in 2008. Parle Bisleris latest product, Bisleri Mountain Water, is bottled in two plants in Uttarakhand (formerly Uttaranchal) and Himachal Pradesh. The company plans to invest Rs100 million to increase the new brands manufacturing and distribution capacity.