The Tasty Bite Story

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The Turnaround Story Contd...

The company thus decided to slash the product portfolio from 25 to 8 and retained only those products that were familiar to the American consumer. Also, products were renamed in English for instant identification and easy understanding. Thus, 'Palak Paneer' became 'Kashmir Spinach,' 'Navratan Korma' became 'Jaipur Vegetables' and 'Alu Chole' became 'Bombay Potatoes,' and so on. The recipes were also modified to suit the western palate. PBI also modified the packaging to suit customer requirements. Earlier, products were sold in pack sizes that ranged from 200 gms to 1 Kg.

This was replaced with a standard size of 300 gms, as unlike mainstream food in the US, Indian food was not consumed in large quantities. The smaller pack size motivated the consumers to give the products a try. By August 2001, the pack size was changed to 285 gms (10 ounces) to bring it in line with American standards of measurement. This also meant that a store shelf now accommodated nine packs as compared to the seven earlier. By 1998-99, TBEL began reaping the benefits of its turnaround efforts and recorded a net profit of Rs 4.7 million. By the end of 2000, its products were available in 27 US states through 33 leading natural food stores and mainstream supermarkets. By 2001, TBEL's profits increased nearly three fold to Rs 13.42 million (Refer Table I). According to SPINS, an agency that tracked the market shares and consumer preferences of natural food brands in the US, TBEL was the largest brand in the category. Bombay Potatoes (Alu Chole) had become a common side dish for many Americans. TBEL's entry into Holland, Switzerland and UK was also showing positive results.

Future Plans

In September 2000, TBEL began working towards repeating its export market success in the domestic market. TBEL divided the Indian market into two broad segments: the domestic segment focussing on working women, and the institutional segment comprising fast food restaurants, hotel chains, airline flight kitchens and the Indian Army and Navy. Nigam said, "Although Tasty Bite is the No. 1 selling Indian food brand in the US, the task in India is daunting. The challenge, therefore, is to first establish the category and then associate it with the brand."

TBEL was optimistic that its earlier dismal performance in the domestic market would not be repeated. A national study on the food and grocery sector GROFAST (Grocery and Food Advantage Study), conducted by KSA Technopak,¹⁰ showed that 73% of Indian consumers preferred to have traditional Indian meals in the RTS format rather than western food. This attitude was mainly attributed to the shift in the preferences of consumers and readiness of Indian consumers to experiment with food.

A TBEL source remarked, "In India there is a paradigm shift among women. The Indian woman is no longer just a housewife, but is more the manager of the household. Also, the working woman is not guilty about eating outside food at home. Tasty Bite products, therefore, are designed to collaborate and not compete with the new Indian woman." TBEL management felt that the Indian market had become mature enough to appreciate the convenience and value of RTS foods. TBEL launched its products in Pune, Mumbai, Bangalore, Chennai and Hyderabad without much advertisement and promotion support.

Encouraged by the good sales reports, TBEL decided to launch the products nationally by the end of 2001. The company also decided to spend 40% of its domestic revenues to launch a billion brand-building campaign during 2001-02. TBEL also started conducting research for launching RTS sweets and non-vegetarian food. By 2001, HLL, Dabur Foods, MTR and Amul had also entered the Rs 10 billion Indian RTS food market. TBEL planned to increase its turnover to Rs 1 billion by 2003. The company seemed to be working hard to fulfil Kilachand's vision of becoming 'the most respected food company in India.'

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10] Kurt Salmon Associates (KSA Technopak) is a Management Consulting firm, offering integrated strategy, process and technology deployment solutions to the Retail, Fashion, Food & Grocery and Healthcare industries.

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