Market entry strategy for a start-up entering the Indian dairy market
An American start-up in the dairy segment wanted to enter the Indian market, in the very niche sector of khoya and mawa, an ingredient used in Indian sweets, ice creams and other traditional products. The khoya market is very disorganized, plagued by issues of hygiene, consisting of many players and subject to local, vested interests
The mandate was to help the client understand the feasibility of the market entry and the best mode of operations, including prospective partnerships given the political sensitivities, local risks, regulatory issues and vested interests in the sector.
To enable the client to make the best decision, we conducted an indepth analysis on certain key paramters:
- Market dynamics – including the main players, modes of production, supply chain, logistics and consumer dynamics and the sophistication of the existing khoya technology in India
- Policy and regulatory analysis
- Vested interests and local risks
- Prospects for growth within India (state wise breakdown) and in markets with a large Indian diaspora (primarily for export linkages)
Through our study we identified the following aspects:
- Three areas for potential market entry with pros and cons of each – technology licensing to a big dairy player/big sweet shop, partnership with FMCG companies (Indian and global) or self manufacturing.
- We also identified stakeholders and the next steps for each of the proposed solutions to be taken ahead in discussion with the client
- We created a framework for the client to enable them to hire the best local team, liaison with legal and technology experts and interact with government and other stakeholders