How Parle-G Makes Millions Without Raising Prices Case Study -

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A packet of Parle-G biscuits was worth 4 in 1994 when P. V. Narasimha Rao’s government was in power in the country and petrol was 16 and diesel was 8. Now, after 29 years, Atal Ji has been in the country for 6 years and Manmohan Ji has been in the country for 10 years.

Modi’s government is completing 10 years of petrol and diesel and has crossed 100. Still, what is the price of Parle-G? “5” and this 5 price also happened in 2021. It means that from 1994 to 2021, Parle-G did not increase the prices of its products for 27 years. It means that the child who was on the lap 27 years ago now comes into the lap of that child. However, the price of the Parle-G product is the same.

How Parle-G Makes Millions Without Raising Prices?

If you are thinking and you happen to be mistaken due to a misunderstanding, if they are not increasing the price, then what must the company be earning? Where will sales be increasing? Sir Ji, in 2013, Parle-G became the first FMCG brand to make sales of 5000 crore, and today, considering the figure of 2022, they have crossed the sales of 16000 crore, and it has done all this without increasing the price of Parle-G. And this is not a start-up deal, like they will be giving money from somewhere else or the company will be at a loss.

Table of Contents

The company is in full profit, and they are taking home the money earned in their own pockets. In 2011, Nelson said in its report that it is the world’s highest-selling biscuit brand. How much is it sold? Let me give you a small example of it: Parle-G makes more than 100 crore packets every month. That means 3 crore, 35 lakh per day, 13 lakh packets per hour, and 23 thousand packets per minute.

So, as long as we’ve talked till now, Parle-G has made more than 25000 packets till the time, and if this video goes on for 12–13 minutes, then it will make 3 lakh packets by that time. This is the power of Parle-G. Now, it must be running in your mind. The company is not increasing the price of its product, turnover is also increasing, and it is earning money as well.

How is it doing this? and you have many other questions as well. Who created this brand? Why was this brand created? How is this named Parle? Why is it called Parle-G? And the Parle family was divided into three pieces? Which family is handling which business?

Hence, the next time you are eating Parle-G biscuits while having tea and want to impress the person sitting in front of you or learn its lessons to make your business successful, then read to this case study completely.

History of Parle -G

So, let’s start with the history of the Parle Group. Who, when, and where did they start? How is this named? and all Parle Group was started in 1929 by the Mohanlal Dayal Chauhan family. There is one thing I keep telling you about this: Your childhood memories will get refreshed. This is my guarantee because in 1929, the first product was made. That was the orange candy. Seeing it reminds me of my childhood days.

Then, for 10 years, they kept making confectionary-related items like candy, etc. For the first time in 1939, They made a biscuit It’s name was Parle Gluco Biscuit In the beginning, the factory was started with only 12 people And mostly, there were family members Meaning, family members, brothers, children and friends, Together, they started the work Today, there are more than 50,000 employees So from 1939 to 1947.

They were exclusively making biscuits for the British army The common man did not have access to them and when the British left in 1947, The country became independent Now, they were open and brother, they can do anything Now, at that time, India was a poor country Biscuits were a product that rich men used to eat and used to get imported There was no national brand and they were much inspired by the Swadeshi movement Like, ‘Will make some Swadeshi Products’, ‘Will make some Swadeshi Products’.

So, they said that now, Let’s put our indigenous biscuits in front of these foreign biscuits Now, they had already made desi biscuits and so, opened them for the common man It was super tasty and low-cost And a person who always thinks that big people eat biscuits, Big people eat biscuits and suddenly, it comes into the hands of a small person It’s quite likely that the sales will increase.

How was It Name Parle-G?

Now, you all must be thinking that Sir Ji, How did they name it Parle? They named it Parle. Like, when their first factory was set up, that factory was set up in Ville Parle. So, now they set up the factory in Ville Parle. Now, someone nearby says, Have you seen those biscuits? Whose biscuits? Hey, there is a Parle’s company.

So, brother, the name became associated with Parle. Hence, they said, The world knows more by this name. Let’s keep the name Parle only. Therefore, the name of the company was Parle and the name of the biscuit was Gluco. Now, brother, do you know what happens in India? If one thing succeeds, then the process of copy-pasting continues behind it.

Parle-G And Gluco Biscuit

The whole world gets engaged in a copy, and this thing was doing so well. Its copy was supposed to be made. Now, Glucose biscuits have started flooding the market. Britannia is launching its own, and that too in the name of Gluco. Took Gabbar Singh in the ad, and brother, this Gluco is becoming famous.

As Ampro company was bringing Gluco products into the market, and all of them make everything copy-pasted. So, they (Parle) said, First of all, we created Gluco Biscuit. The thing is ours, the invention is ours, and it is taking the credit completely.

Whereas, the general public doesn’t know, What belongs to whom? They said something had to be done. Hence, what did they do in 1985? They changed the name of their product to “Parle-G.” So, they removed Gluco and saved itself from the competition.

About The Parle Group Company

Now, let’s talk about the Parle Group Company. Many people say that Bisleri belongs to Parle. Many people say that Bailey belongs to Parle. Many people say that Frooti belongs to Parle. This all belongs to Parle; however, it is different. So, Mohanlal Ji had five sons, and when there are five sons, you know, brother, this is India.

There are also divisions here, so, in the future, that company was divided into three pieces. Listen carefully, Jayanti Lal Chauhan. First of all, he separated and said, Brother, I don’t want to work with you. I will do something different. So, in the name of separation, he did his own work, and the name of his company is Parle Agro. They make Frooti, they make Bailley water, they make Appy Fizz.

And if you want to know about them, what did they do? When did they do it? How did they do it? and the case study of Frooti has been made separately. The editor will give the link; click on it and also see this one. After some time, the second brother, Ramesh Chauhan Ji, said, Yes, we go too.

Hence, they started Bisleri, while the second company runs under the name of Parle Bisleri, and the third company, which is the main company left by the three brothers, is Parle Products, which makes biscuits and all these products, and today, we are doing a case study on this. First of all, tell me, Rahul Ji, that if they are not increasing prices, then how is turnover increasing? and the turnover is increasing; however, from where are they increasing the profit? Wait! I will tell you everything.

How Parle-G is Earning Profit?

Strategy No. 1: Increase your Product Portfolio.

Brother, there are only a few ways to increase sales. Firstly, keep increasing your customers. All companies did this; they also increased the same. However, there is a limitation to it. Secondly, brother, increase the price. However, they swore that we would not increase it. Then what should we do, brother? So, the third way is to increase the product. If one product is not enough, then make many products.

In 1939, when he made Parle-G, i.e. Glucose Biscuits, and around that he said, ‘Hey, we are selling sweet biscuits. However, when someone does not want to eat sweet biscuits, he said, Khara Biscuit, Salty Biscuit, India’s first salty biscuit, “Monaco.” Let’s launch that too. Hence, they said, Take Parle-G if you want sweet biscuits, or take Monaco if you want salty biscuits. And if someone said, I want both sweet and salty biscuits. They said, brother, take Krackjack.

Someone said I will eat cashew biscuits. Cashew biscuits have come in the market. They said, Wait, let us bring 20-20 biscuits. For them, let’s bring Hide & Seek, and nowadays, there is a fashion to fill chocolate in the middle of the biscuit. So, let’s bring Hide & Seek Platina. Then, they said to develop a new category, and so, come with Magix. It means, as you are seeing, many brands of different companies. No, brother! Parle brand is sitting with many brands.

Now, you are feeling that if you only make biscuits, then, brother, let’s remind you of some memories of your childhood. They said, Why only sell biscuit products? Let’s do something in confectionary as well. Hence, they launched Kismi Bar in 1963. Who has eaten this? Tell us in the comment box. In 1966, they launched Poppins.

Who has eaten this? In 1983, they brought Melody “Melody hai Chocolaty” and in 1986, they brought Mango Bite Hence, they have a huge portfolio of biscuits They have a huge portfolio of confectionary and now, they have slowly started entering into FMCG products.

They have come with the Rusk (product) Eat toast brother Parle-G flour is also available, Parle-G Dal is also available, and like we eat Chocos by putting it in milk during breakfast, That too, Parle-G product (Cereal) started coming Hence, by doing all this, It became the first brand in 2013 to cross the turnover of 5000 crores Parle-G i.e. the main product, What is it? It is the driver’s product. This does not give margin; this gives driving. Sir, what is a driver’s product? Parle-G products go to more than 50 lakh shops.

How does it go? Even if there is a small shop on the highway far away, you will definitely get Parle-G there. Parle has made its own product. Now, they have launched a new product. For instance, Parle launched “20-20” (biscuits). Now, if any new company launches “20-20” (biscuits), they will face a problem in delivering it to that shop. Some shopkeepers will take it, some will not.

Now, the shopkeeper is already sitting there every day and asks, brother, have you brought Parle-G? Have you brought Parle-G? and so, he (the distributor) says yes, there is a packet of Parle-G, Do one thing, keep this ’20-20′ as well So, that “Access” is available, If you want to introduce any new product in any shop, Then it comes easily on the back of Parle-G Secondly, it comes happily and if does not come happily, then it also comes unwillingly.

Like, see, you will have to buy this product “20-20” If you don’t buy this, we won’t even give you the main Parle-G Now, no shop will survive without the Parle-G They will say that if there is no Parle-G, Then, the customers will go here and there Hence, give us 1-2 boxes (of other Parle biscuits – by the shopkeeper) So, happily or unwillingly, It is necessary to keep other Parle products Secondly, if Parle’s name is written on any new biscuit.

Then, we feel that we should try it Now, there is a Hide & Seek product, I don’t know what they have made Then, hey brother, it is of ‘Parle’ (Shopkeeper) Ohh, this is of Parle? (by customers) Then, it must be right (by the customer). Hence, they are playing with the name also.

Parle-G, Silent Price Increase

Strategy No. 2: Silent price increasing

The second method is silent price increasing. What is this? Look, listen carefully. Who the hell says that the price of Parle-G hasn’t increased? When Parle-G was priced at 4, it came in a 100-gram pack. Now, what is the price of Parle-G? Earlier, it was 100 grams; it became 80- grams, then 60 grams, and now it comes in a 55-gram packet.

So, if I say that my stomach gets full by eating 100 grams of Parle-G biscuits, what is the cost of 100-gram Parle-G biscuits today? Do the calculation, it will come as 9 Hence, if the actual cost of that 4 packet is based on 100 grams (assumed), it should be 9 Yes, they have kept its price at 5, However, they have also decreased the quantity. Hence, if seen in a way, the price has come from 4 to 9 However, you don’t know this is called shrinkflation.

Don’t increase the price but reduce the weight. The work gets done. And what is shrinkflation? Why does it happen? How do companies do it? I have made a separate video on it It’s link will also be provided and they have not done shrinkflation only in the weight term, However, in everything Partle-G, if anyone has eaten the old ‘Parle-G’ It used to come packaged in wax paper.

Now, they have made it equal to cheap plastic packing and whoever buys a bigger packet, Will see inside it that there is a cover of Parle-G on the top If you put your hand inside, there is an empty foil, There is no cover there, brother, They have not changed the design till now.

The old packet which was running 25 years ago The same packet is running and there is also that same little girl That girl must have had grandchildren, However, the photo of that girl is still running (on packets) Hence, they are not increasing the price on the one hand, And, on the other hand, they are controlling the costing and they have done many things in terms of costing Come.

Parle-G, Cost-Control

let’s discuss First, come as raw material. Whatever raw material they needed to make the biscuits, Understand one thing: “Economy of Scale.” A company that makes more than 100 crore packets every month doesn’t place an order for one truck or two trucks; it is for 1 ton or 2 tons. They say, Let’s come 100 trucks, 500 trucks, 25 tons, 50 tons.

This order is accepted. Hence, where this order runs, there are two benefits. As there is a very large quantity, brother, brother, the person in front keeps a very small margin. And one can get a very cheap product.

Plus, if it is such a large quantity, then they do not keep any commission, agent, or chain in between. You have to buy small quantities. You buy it from the shopkeeper. He bought it from somewhere else. In between, there is a margin of three people.

This directly goes to the producer. The middle chain ends. Hence, the cost is already cheap, and plus, in such a heavy quantity, So, that leftover is also squeezed out, and whatever product is a commodity, like the whole world is making as you are making There is no scope to increase the price.

There are margin books during the buying process. If you have a brand, I will keep the price as per my wish. Still, the world will take it. Then, you don’t need to worry so much. When it seems that you cannot increase the price even by 2, Brother, you will die. So, the entire margin has to be recovered at the time of purchase.

The raw material is bought at the cheapest price in the industry (parle). It’s profitable. Secondly, what is it? – The cost of manufacturing Operational efficiency of them is good as, sir, during 1947–48, they had brought India’s largest oven, i.e., 250 feet long. They are so advanced in technology.

Currently, they are working with IBM. They have implemented SAP. Hence, they got the operational efficiency in logistics. They know each and every point of data in production. They know everything. What is their wastage? When they make 115 tons of goods, 1 tonne is wasted. Hence, the total wastage is around 0.86%, Sir Ji. Imagine the wastage of less than 1% in the food items (manufacturing).

They have more than 50,000 employees. For them, they have made KRA and KPA in a way that no person can sit idle and no person can reduce his productivity. In this way, everyone has been tied.

Vyapari To Ceo

If you are a normal person and watching such a case study, then you are understanding it roughly. However, if you are a businessman and want to study deeply, what is this commodity product? What are the KRA and KPA? You have to know technical aspects, and you want to go deep into the business.

Then, every Sunday, I do a webinar from 10 a.m. to 2 p.m. where I teach small business owners how to achieve that. You must have seen its ads in many places, and if you haven’t, then the link is below this video. Do subscribe and reach there. You will remember that, brother, that you have attended this class.

Parle-G Location Strategy

I promise that now, brother, things have been made cheap, saving money on packaging, taking raw materials at a low cost, bringing efficiency in production, and implementing technology. Now, what? Now, distribute it. Now, take it to the public. It is available in more than 50 lakh shops in every village, which means that one will not get anything on the highway.

You will get Parle-G there. Many times, it happens that I want a small packet or a big packet. Then, Parle-G says what? Listen, brother, you want a biscuit of ‚2, and I give you a biscuit of ‚5, and I give you a packet of ‚10, ‚20, ‚25, and ‚50. I will give you as big a packet as you need.

However, sir, how does it deliver it to such far-off villages? Here comes its location strategy. What is this, sir? It has big factories in every corner of India, and whatever the main is, they set up their factory at a distance of 50–60 km. Like, where they established their factory, there is a big market neartheir factory at a distance of 50–60 km.

Like, where they established their factory, there is a big market neartheir factory at a distance of 50–60 km. Like, where they established their factory, there is a big market near its 50–60 km. Hence, it does not take much time or money, and the movement of goods happens quickly. Higher stock is not gathered at once, hence, there is not gathered too much stock at once. So, those who are businessmen will understand that the working capital is not accumulated much.

However, there is a continuous rotation. Hence, the business runs fast. And where they feel that they are not able to cover the whole of India, we have a limited50–60 km. Hence, it does not take much time or money, and the movement of goods happens quickly. Higher stock is not gathered at once, hence, there is not gathered too much stock at once. So, those who are businessmen will understand that the working capital is not accumulated much. However, there is a continuous rotation.

Hence, the business runs fast. And where they feel that they are not able to cover the whole of India, we have a limited50–60 km. Hence, it does not take much time or money, and the movement of goods happens quickly. Higher stock is not gathered at once, hence, there is not gathered too much stock at once.

So, those who are businessmen will understand that the working capital is not accumulated much. However, there is a continuous rotation. Hence, the business runs fast. And where they feel that they are not able to cover the whole of India, we have a limited50–60 km.

it does not take much time or money, and the movement of goods happens quickly. Higher stock is not gathered at once, hence, there is not gathered too much stock at once. So, those who are businessmen will understand that the working capital is not accumulated much. However, there is a continuous rotation. Hence, the business runs fast. And where they feel that they are not able to cover the whole of India, we have a limited50–60 km. Hence, it does not take much time or money, and the movement of goods happens quickly.

Higher stock is not gathered at once, hence, there is not gathered too much stock at once. So, those who are businessmen will understand that the working capital is not accumulated much. However, there is a continuous rotation. Hence, the business runs fast. And where they feel that they are not able to cover the whole of India, we have a limited50–60 km.

Hence, it does not take much time or money, and the movement of goods happens quickly. Higher stock is not gathered at once, hence, there is not gathered too much stock at once. So, those who are businessmen will understand that the working capital is not accumulated much. However, there is a continuous rotation.

I told them, Look, we are giving you the product. We are telling you the machine. We are telling you how to make it. You just make it and give it to us and take your price. They have covered the entire market in such a way that if you want to deliver it to any corner of the village or place, Parle-G will deliver it at a low cost.

So, if I tell you the conclusion of the business, this is about Parle-G, however, applies to every business. Listen carefully. There are some points that make every business successful. First, control the cost. Buy material in bulk, buy directly from vendors, save money. Secondly, increase the efficiency of your production or processes. This is the game of business. Be it any type of business, any Train people in such a way, Use technology in such a way This means, less number of people can do more work And by doing this, when you have made a good product at a low cost, Then, distribute it to as many places as possible Make it reach every corner of the country.

Conclusion

And for that, take the help of marketing So, now, your marketing is solid (strong), Distribution is solid (strong), Then, the product will be reached everywhere And, your cost is under control, Your margin will be saved This is the game of business, There could be any business, any product or any industry The game is just like this And an individual keeps getting worried about understanding.

it However, You don’t have to worry Your brother has a complete package First, enter the ‘Vyapari to CEO’ and understand what’s going on And if you like the case study, Then, tell me which product to do the next case study on Your brother will be spot-on Secondly, in the middle of this, A case study was done on Parle Agro I am giving the link to that video And I am giving the link to Shrinkflation separately Watch both of them and if you like them, then subscribe to the channel

Watch Video: https://youtu.be/VIKhf2_wbPQ?si=ZDbRUWZFrHppTZ-d

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