The Hindu Business Line : Bunge plans selling edible oil in sachets

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Bunge plans selling edible oil in sachets

Purvita Chatterjee

Mumbai, Nov. 4 Popular vanaspati-brand Dalda is set to drive the sachet revolution in the edible oils category. After the success of shampoos in sachets from other FMCG companies, Bunge India is taking this route to make its Dalda edible oils more affordable, offering sachet packs priced at Rs 5 (70 ml) and Rs 10 (145 ml) to consumers in smaller towns.

In spite of volatility in edible oil prices, the decision to launch smaller packs with lower pricing is a pioneering effort made by the MNC to ride down the population strata to address the daily edible oil consumption needs of consumers across the country.

Mr Videh Jaipuriar, Vice-President Foods Business, Bunge India, told Business Line, “We are going to be the first player to get on the affordability platform with our blended oils under the Dalda brand. The purpose is to create a new category under ROCP (refined oil in consumer packs) at the bottom of the market.”

Bringing in two different blends (sunflower oil with palm oil and soyabean oil with palm oil), Bunge is primarily targeting the industrial belts in States such as Bihar, Jharkhand, Uttar Pradesh and Madhya Pradesh before taking it to the metros. “It is the labour class in the Class 2 and 3 towns who are going to be the major consumers of our packs. Research shows that there is consumer demand for smaller packs for people who buy on a daily basis. Both retailers and consumer would find these pack sizes and prices convenient,” states Mr Jaipuriar.

In fact, almost 65 per cent of the edible oil market continues to be unbranded with consumption growth hovering around 4 per cent. However, of late, there has been a shift towards branded oils with the category growing at nearly 20 per cent, observes Mr Jaipuriar. In this scenario, Bunge has decided to take advantage of its heritage brand – Dalda (which was acquired from the erstwhile Hindustan Lever Ltd four years ago) to launch a new stock keeping unit (SKU) and price to cater to the growing demand for branded edible oil packs and catering to the daily needs of consumers.

Last year, it stretched Dalda’s equity from a vanaspati offering to edible oil variants in soyabean and mustard oil.

Now blending its oils with the lesser expensive palm oil is a strategy to bring down its prices and SKU’s to reach out its brand to the smaller towns and cities. As Mr Jaipuriar adds, “No other big branded edible oil player has entered this space as there is fear of down trading with consumers. However, we are not a big volume player in edible oil and felt there was a market staring at our face. Instead of just playing a pricing game like any other branded commodity player, we have decided to enter a category that has not been treaded by others.” Targeting a turnover of Rs 1,150 crore before the year ends, Bunge expects to double its market share (currently at 3 per cent) with its new blended oils sachets.

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