Case Code : CLMM009
Publication date : 2005
Subject : Marketing Management
Industry : Retailing
Length : 04 Pages
Price : Rs. 100
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Private Store Brands, FoodWorld, R P Goenka (RPG), Brand Equity, Nature's Bounty, Core Competency, Retailing, Retail Margins, Product Portfolio, Vendor Management, Value Gaps, Supply Gaps, Brand Identity, Value for Money, Delivery Equity
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The caselet provides a brief description of FoodWorld, India's leading food retailer, and its operations. It discusses FoodWorld's private branding initiatives and their rationale behind such a strategy. The caselet examines the advantages and the pitfalls associated with private branding initiatives.
The jam was sold under the brand name 'FoodWorld' and was priced much lower than the other brands. Within a month of their launch, FoodWorld jams accounted for 17% of FW's sales in that category.
This development marked one of the first major instances of the conflict between 'private store brands' and 'FMCG company brands' in India. While the phenomenon is rather common in countries such as the US and the UK, FW became the first retailing chain to challenge the might of leading FMCG companies in the country...
Questions for Discussion:
1. Why do you think FW was trying to increase its focus on private brands instead of focusing on developing its merchandising skills?
2. What problems could the company face as a result of its move to sell private brands alongside national brands?