Asia-Pacific, with India taking the lead, has begun setting the pace for growth globally for confectionery and beverages major Cadbury Schweppes.
Consequently, it has identified India as a `battleground and must-win market' and substantially scaled up capital and revenue investments in the Indian subsidiary.
A complete recovery in Cadbury India's chocolate business during '05 significantly contributed to its sales growth in emerging markets in Asia. The board has endorsed a plan in September '05 to expand the Indian market by growing consumption and strengthening distribution.
Meanwhile, taking its cue from P&G and Unilever, Cadbury Schweppes has also begun a regional grouping system of similar markets to share resources and capabilities across the board from product innovation, raw material sourcing, productivity, manufacturing consolidation and the effectiveness of its sales force.
Talking exclusively with ET, Rajiv Wahi, president, Asia-Pacific region, said that the chocolate maker is revisiting its business strategy and has begun decentralising systems for better efficiencies. “There are big investments being planned for India. Asia-Pacific, especially India, is a happening story.
The region is being strategically viewed by our parent company as a crucial market. There is a conscious move to break territorial barriers and encourage free flow of capabilities across the board. We are getting into offering a product portfolio for consumers, which our CEO calls a `smart variety'.
It clearly makes better sense to borrow from each other rather than reinvent the wheel,” he said. While the Asia-Pacific region reported an 8% growth in sales, emerging Asian business posted an 11% growth in sales. For the year ended December '05, Cadbury India recorded a 15% growth in topline at around Rs 900 crore.
With a 70% market share in chocolates, the focus, this year, is to push growth rates in confectionery and chewing gum. In fact, a Mexican team is in Mumbai to assess the Indian confectionery market and assist the company in strategy and product implementation.
The team is also understood to be keen on learning from Cadbury India's success in the chocolates business.
Globally, Cadbury has had a huge success in Mexico's chewing gum market. “Last year, almost £10m was invested. The parent company will be investing a significant sum further to grow the market though higher consumption and better distribution,” Mr Wahi said.
Cadbury India has identified confectionery and chewing gum as the next agenda for growth. Meanwhile, Anand Kripalu, an ex-Unilever hand, has taken over as managing director of Cadbury India, while Bharat Puri has been appointed as commercial strategy director for Asia-Pacific and will be based in Singapore.
“Movements of people within Cadbury group signals the end of borders as far as tapping talent is concerned,” Mr Wahi said. As the head of operations in the Asia-Pacific region, Mr Wahi, 52, is responsible for the strategic direction and management of 12 businesses with a combined turnover of over £1bn.
He also sits on the Chief Executive Committee, the team responsible for driving the high-level performance on Cadbury Schweppes's growth, efficiency and capability programmes.