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Transform your business with our strategic guidance and support
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The Bangladesh ice cream market is showing strong promises of growth due to socio-economic development of suburban and urban consumers and surge in per capita income across the country.
We focus on the Bangladesh ice cream market where their 10-Year CAGR of 16% has been growing at 16% to 20% annually since 2010. Though there were temporary setbacks due to the COVID-19 pandemic, the market quickly rebounded. The estimated 2023 market size of ice cream in Bangladesh was around $245 Million USD equating to roughly $4 USD per liter. For reference, EU countries in 2022 exported 250 million liters of ice cream to non-EU countries equating to $4.03 USD per liter. Some of the drivers behind this growth can be attributed to urbanization, a growing middle class, and large-scale investments in the industry.
Over the last 15 years, the marker saw conversion towards branded products offered by companies backed by established conglomerates which have priced out products manufactured in unhygienic, low tech, and non-compliant setups. Now 97% of the market is cornered by the branded companies. In the past there were issues with suppliers and storage of raw materials, with the recent investments within this space we see the Bangladesh market being able to store and keep these materials in proper form. The model of distribution has also been revamped to emulate FMCG and CPG products with one key factor being that the manufacturer and marketer company is expected to place a freezer in the outlet through an industry norm contract. It is estimated that there are about 100,000 freezers that have been placed by the manufacturers across the country.
This case study focuses on Revlon India which was struggling for a while with their poor supply chain, E-commerce presence, and poor accountability which resulted from overspending and siloed beauty channels. With the implementation of new management the company has been able to turn around the company and improve retail operations through reorganization.
The Indian retail market was estimated at $836 billion in 2022 and anticipated to grow to $2 trillion by 2032. A catalyst for this growth is the surge in e-commerce. However, in 2021 75% of consumer goods were sold by small to medium-sized businesses.
Umesh Modi Group (UMG) was one of India’s largest industrial conglomerates and in 1995 partnered with Revlon Inc. to bring Revlon to India. They expanded into 79 Indian cities but the company was being outcompeted by Indian brands with larger advertising budgets and more established distribution networks.
With new leadership Revlon India discovered a lack of accountability on all levels and how little senior leadership knew about the frontlines. Even though there was a greater focus on brick and mortar, board complaints were passed along that e-commerce was struggling as well. While the company had addressable issues, little could be improved without fundamental change in culture and structure and therefore one of the first actions was to reorganize the sales organization.
The silos broke down between personal care and cosmetics care divisions and all sales managers were now under one umbrella ensuring the company seized opportunities to expand its business while providing equal attention to all product categories. All head office members were required to visit stores regularly and every retail location received a monthly audit from the head office to make head office leaders accountable.
From this stemmed greater work to revamp distribution networks, sales and accountability, and improving support and supervision. With these improvements they were able to move onto making e-commerce a priority and building a better organization through strategy mapping.
To access this case study go to: https://hbr.org/case-selections
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