Varun Berry (pictured), the new COO, executive director and country head of bakery major Britannia, is a man in a hurry these days, driven by his clear priorities. “I want the company to grow aggressively and make lots of money.”
Company distributors testify that Britannia has become far more aggressive in the last six months.
As if to reinforce their view, Berry says, “Is there anyone, anywhere in the country who doesn’t know Britannia? But then, they don’t buy it because it’s not available.” Therefore, he explains, distribution is going to be the game-changer.
“We are looking at innovative ways to increase distribution. The objective is to increase both breadth and depth of distribution. For instance, instead of one salesman going to a store, we can have two salesmen going with different stock keeping units (SKUs) to the same store.”
In order to deepen Brittania’s reach, Berry will target the hinterland, like other companies have been doing of late. With the economy slowing down in urban areas, Britannia’s focus is going to be on increasing presence and distribution in rural areas, Berry says.
Rural market is clearly under-penetrated as far as Britannia is concerned. The rural share is only 40% of the company’s urban presence – a gap that Berry is keen to close completely.
The way forward is to invest steadily. Britannia’s 11th plant in Jhagadia came up on an investment of Rs 75 crore. It is expected to improve distribution is Gujarat, Madhya Pradesh, Maharashtra and Rajasthan.
On the anvil is a Rs 100-crore factory in Tamil Nadu, which will complement its existing plants in Bihar, Orissa and Tamil Nadu that came up with an investment of around Rs 170 crore over the last three years.
Britannia is also ramping up its capacity so that dependence on contract manufacturing is minimised. For, it owns only 11 of the 38 plants that make Britannia products, though they account for 50% of total output.
All these investments, Berry is quick to admit, have helped improved Britannia’s market share and revenues. “In whichever state we have put a factory in, we have seen an improvement. Also, it will help us to keep our technology in-house – the technology we use to make differentiated products.”
In order to garner more market share, it is looking at more value-added products.
In the Rs 65,000-crore dairy segment, it wants to sharpen its act; but, since much of its revenues come from the Rs 35,000-crore biscuit market, Britannia will continue to keep its focus there for now, says Berry.