CONCLUSION AND SUGGESTIONS

Transcription

1 CONCLUSION AND SUGGESTIONS CONCLUSION The main conclusions of the present study are given below: COST OF PRODUCTION OF BAKERY PRODUCTS The production cost of Bread remains lowest i.e. Rs per Kg. The Production cost of Rusk comes to Rs per Kg. In case of Biscuits and Patties these costs remain to Rs and Rs per Kg. respectively. The production cost of Burgers comes to Rs per Kg. while in case of Cake, Pastries, Pizza, Namkeen and Sandwiches the per Kg. costs come to Rs , Rs , Rs , Rs and Rs per Kg. respectively. MARKETING CHANNELS Bakers usually prefer to sell their products through distributors/wholesaler in different parts of the Region. Distributors/wholesalers buy products directly from bakers and sell them to the retailers. Then these products are sold to the consumers. MARKETING CHARGES AND MARGINS IN CASE OF BAKERY PRODUCTS 1. BREAD: The Baker sells the Bread at a price of Rs per kg and his manufacturing cost and marketing charges are Rs and Rs per kg respectively. Thus his total cost per kg computes to Rs and profit margin 45 paise per kg.

2 At distributor s level the selling price remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs per kg respectively. Thus his total cost computes to Rs and marketing margins to Re per kg. At retailer s level the selling price of Bread remains to Rs per kg and his purchase price and marketing charges come to Rs and Re per kg respectively. Thus the total cost of this product computes to Rs per kg and marketing margins to Rs per kg. It is also noted that in case of Bread total marketing charges are Rs and marketing margins Rs per kg. Thus the total marketing cost computes to Rs per kg of Bread. In case of this product the marketing charges and margins seem to be quite reasonable because no manufacturer or trader can exist in the market below this margin level. 2. BISCUITS Baker sells Biscuits at a price of Rs per kg and his manufacturing cost and marketing charges are Rs and Rs per kg respectively. Thus his total cost per kg computes to Rs and profit margin Rs per kg. At distributor s level the selling price remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs per kg respectively. Thus his total cost computes to Rs and marketing margins to Rs per kg. At retailer s level the selling price of this product remains to Rs per kg and his purchase price and marketing charges 167

3 come to Rs and Rs per kg respectively. Thus the total cost of this product computes to Rs per kg and marketing margins to Rs per kg. It is also noted that in case of Biscuits total marketing charges are Rs and marketing margins Rs per kg. Thus the total marketing cost computes to Rs per kg of Biscuits. In case of this product the marketing charges and margins seem to be quite reasonable because no manufacturer or trader can exist in the market below this margin level. 3. CAKES: The Baker sells Cake at a price of Rs per kg and his manufacturing cost and marketing charges are Rs and Rs per kg respectively. Thus his total cost per kg computes to Rs and profit margin Rs per kg. At distributor s level the selling price remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs per kg respectively. Thus his total cost computes to Rs and marketing margins to Rs per kg. At retailer s level the selling price of Cake remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs per kg respectively. Thus the total cost of this product computes to Rs per kg and marketing margins to Rs per kg. It is also noted that in case of Cake total marketing charges are Rs and marketing margins Rs per kg. Thus the total marketing cost computes to Rs per kg of Cake. 168

4 In case of this product the marketing margins seem to be quite reasonable because no manufacturer or trader can exist in the market below this margin level. But so far as the marketing charges are concerned delivery van expenses, warehouse expenses and advertisement expenses at Baker s level, delivery expenses at distributor s level and preservation cost at retailer s level are considerably high which should be reduced to the reasonable level. 4. PATTIES The Baker sells Patties at a price of Rs per kg and his manufacturing cost and marketing charges are Rs and Rs per kg respectively. Thus his total cost per kg computes to Rs and profit margin Rs per kg. At distributor s level the selling price remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs per kg respectively. Thus his total cost computes to Rs and marketing margins to Rs per kg. At retailer s level the selling price of Patties remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs per kg respectively. Thus the total cost of this product computes to Rs per kg and marketing margins to Rs per kg. It is also noted that in case of Patties total marketing charges are Rs and marketing margins Rs per kg. Thus the total marketing cost computes to Rs per kg of Patties. 169

5 In case of this product the marketing margins seem to be quite reasonable because no manufacturer or trader can exist in the market below this margin level. So far as the marketing charges are concerned delivery van expenses, wrapping expenses and advertisement expenses at Baker s level and delivery van expenses and warehouse/shop expenses at distributor s level seem to be slightly high which should be reduced to a considerable level. 5. PASTRIES The Baker sells Pastries at a price of Rs per kg and his manufacturing cost and marketing charges are Rs and Rs per kg respectively. Thus his total cost per kg computes to Rs and profit margin Rs per kg. At distributor s level the selling price remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs per kg respectively. Thus his total cost computes to Rs and marketing margins to Rs per kg. At retailer s level the selling price of Pastries remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs per kg respectively. Thus the total cost of this product computes to Rs per kg and marketing margins to Rs per kg. It is also noted that in case of Pastries total marketing charges are Rs and marketing margins Rs per kg. Thus the total marketing cost computes to Rs per kg of Pastries. In case of this product the marketing margins seem to be quite reasonable because no manufacturer or trader can exist in the 170

6 market below this margin level. But delivery van expenses, wrapping expenses and advertisement expenses at Baker s level and preservation cost at retailer s level are too high which should be reduced reasonably. 6. BURGERS The Baker sells Burgers at a price of Rs per kg and his manufacturing cost and marketing charges are Rs and Rs per kg respectively. Thus his total cost per kg computes to Rs and profit margin Rs per kg. At distributor s level the selling price remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs per kg respectively. Thus his total cost computes to Rs and marketing margins to Rs per kg. At retailer s level the selling price of Burgers remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs per kg respectively. Thus the total cost of this product computes to Rs per kg and marketing margins to Rs per kg. It is also noted that in case of Burgers total marketing charges are Rs and marketing margins Rs per kg. Thus the total marketing cost computes to Rs per kg of Burgers. The marketing margins seem quite reasonable at this level because this product is manufactured and sold at large quantity and give the satisfactory return to the Bakers. But at baker s level the delivery van expenses, wrapping expenses and advertisement expenses and at distributor s level delivery van 171

7 expenses and warehouse/shop expenses are quite high which demand for reduction to a reasonable level. 7. PIZZA The Baker sells Pizza at a price of Rs per kg and his manufacturing cost and marketing charges are Rs and Rs per kg respectively. Thus his total cost per kg computes to Rs and profit margin Rs per kg. At distributor s level the selling price remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs per kg respectively. Thus his total cost computes to Rs and marketing margins to Rs per kg. At retailer s level the selling price of Pizza remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs per kg respectively. Thus the total cost of this product computes to Rs per kg and marketing margins to Rs per kg. It is also noted that in case of Pizza total marketing charges are Rs and marketing margins Rs per kg. Thus the total marketing cost computes to Rs per kg of Pizza. In case of this product though the marketing margins seem to be quite reasonable because no manufacturer or trader can exist in the market below this margin level but advertisement expenses at baker s level and warehouse/shop expenses at distributor s level are unduly high which should be reduced to a reasonable level. 172

8 8. RUSK The Baker sells Rusk at a price of Rs per kg and his manufacturing cost and marketing charges are Rs and Rs per kg respectively. Thus his total cost per kg computes to Rs and profit margin Rs per kg. At distributor s level the selling price remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs per kg respectively. Thus his total cost computes to Rs and marketing margins to Rs per kg. At retailer s level the selling price of Rusk remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs.1.50 per kg respectively. Thus the total cost of this product computes to Rs per kg and marketing margins to Rs per kg. It is also noted that in case of Rusk total marketing charges are Rs and marketing margins Rs per kg. Thus the total marketing cost computes to Rs per kg of Rusk. In case of this product the marketing charges and margins seem to be quite reasonable because no manufacturer or trader can exist in the market below this margin level. 9. NAMKEEN The Baker sells Namkeen at a price of Rs per kg and his manufacturing cost and marketing charges are Rs and Rs per kg respectively. Thus his total cost per kg computes to Rs and profit margin Rs per kg. 173

9 At distributor s level the selling price remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs per kg respectively. Thus his total cost computes to Rs and marketing margins to Rs per kg. At retailer s level the selling price of Namkeen remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs per kg respectively. Thus the total cost of this product computes to Rs per kg and marketing margins to Rs per kg. It is also noted that in case of Namkeen total marketing charges are Rs and marketing margins Rs per kg. Thus the total marketing cost computes to Rs per kg of Namkeen. In case of this product the marketing charges and margins seem to be quite reasonable at every stage because no manufacturer or trader can exist in the market below this margin level. But at Baker s level delivery expenses are slightly high which should be reduced to a justifiable level. 10. SANDWICH The Baker sells Sandwich at a price of Rs per kg and his manufacturing cost and marketing charges are Rs and Rs per kg respectively. Thus his total cost per kg computes to Rs and profit margin Rs per kg. At distributor s level the selling price remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs per kg respectively. Thus his total cost computes to Rs and marketing margins to Rs per kg. 174

10 At retailer s level the selling price of Sandwich remains to Rs per kg and his purchase price and marketing charges come to Rs and Rs per kg respectively. Thus the total cost of this product computes to Rs per kg and marketing margins to Rs per kg. It is found that in case of Sandwich total marketing charges are Rs and marketing margins Rs per kg. Thus the total marketing cost computes to Rs per kg of Sandwich. In case of this product the marketing margins seem to be quite reasonable because no manufacturer or trader can exist in the market below this margin level. But at the level of Baker delivery van expenses and wrapping expenses and at retailer s level preservation cost are slightly high which can be reduced reasonably by making the efforts in this direction. Apart from the above conclusions the following more points were noted during the survey: Some of the bakers use the raw material of inferior quality which is not a healthy practice at their part. Moreover, they generally use the different types of non edible colours which are dangerous for the health of consumers. In most of the bakery units the outdated production process is being adopted which increases the costs of bakery products and decreases their quality. In the bakery industry of Meerut Region, the healthy competition is found and every baker and the trader are earning justified margins. Further it is to be added that there is no effect of competition on bakers and they feel free to fix the prices of 175

11 their products due to which they ever remain gainer and earn their profit margins at a very high rates. FACTORS AFFECTING THE COST OF PRODUCTION OF BAKERY PRODUCTS Fluctuations in the prices of raw materials, quality of raw materials, nature of the product, standard of production process, cost of packaging, wastage of raw materials, labour, storing cost of raw materials, semi-finished & finished products, transportation cost, nature of capital involved in business, volume of ingredients in products, expenses of production department, fuel cost, rent or building expenses etc affect the cost of production of bakery products in Meerut Region. FACTORS AFFECTING THE MARKETING MARGINS IN CASE OF BAKERY PRODUCTS Cost of production, interest on capital, pricing policies, demand in the market, number of marketing channels, marketing charges, wastage, change of seasons, storing time, cash or credit sale, competition in the market, marketing area, sales volume, amount of bad debts, government policies and interventions etc leave their effects on the margins in Bakery Industry in the area selected for the study. 176

12 SUGGESTIONS Here are few suggestions in the light of the conclusions drawn from the present research study- There should be a strict check on the wastage of raw material in the store or during the process of production. It will prove helpful in reducing the cost of production considerably. The good quality of raw material should be used in preparation of bakery products whether its cost may be low or high because it affects the health of the consumers. Strict action should be taken against the bakers who use the low quality of raw material or non edible colours in manufacturing bakery products. Their licenses should be cancelled immediately. Trained and experienced labour should be engaged for the production of bakery products. It will result in better quality of production in more quantity and will prove cheaper in comparison to the untrained labour force. The modern and improved production process of bakery products should be used in place of age-old and outdated methods. It will prove helpful in reducing the manufacturing cost and improving the quality of these products. There should be strong efforts to reduce the storing cost of raw materials and semi-finished & finished goods. It will prove helpful in reducing the total cost of bakery products. There should be a strong check on transportation cost at different levels of marketing the bakery products because it increases the total cost and reduces the profit margins of the bakers and marketing intermediaries. 177

13 The bakers should make the efforts to check the increasing cost of production of bakery products. By doing so they will get success in increasing their profits on the same prices. The bakers and distributors should try to expand their business area to increase their sales volume. It will prove helpful in increasing their profit margins. There should be a strict check on the marketing expenses at different levels. It will prove helpful in reducing the total cost of bakery products and increasing the profit margins of the marketing intermediaries without leaving any adverse impact on the pockets of the consumers. There should be the strict control on the wastage of finished products by keeping them safe from any deterioration during the period of their storage. It will reduce their marketing cost and increase the marketing margins. Continuous efforts should be made to reduce the storing time of raw materials and semi-finished & finished products. It will prove helpful in reducing their storing cost and increasing profit margins. The bakers and distributors should not dump the market without judging the paying capacity of the traders. It would save them from heavy losses due to bad debts and will prove helpful in increasing their profit margins. It is the firm belief of the researcher that the above mentioned suggestions would prove helpful in reducing the cost of production and marketing charges and increasing the marketing charges in case of bakery products in the area of the study. * * * 178