Marketing and Distribution of Mushroom

Sachin and Virag are two enterprising youth. They have passed out from IIM, Bangalore. They thought instead of doing a job, they will launch fresh vegetables in Indian markets. Having learnt of the future conventional foods, they decided to venture into cultivation of mushrooms. Mushrooms are known to be the best alternative food for vegetarians. For Sachin and Virag fund raising was a serious handicap for mass production. However, the first trial batch of mushrooms that they produced was bought by Star Hotel in Bangalore. Further, the hotel placed orders for supply of 20 kgs every day. Now mushroom industry is run by small entrepreneurs, like Sachin and Virag. Another big player M/s Ashtavinayak Mushrooms, equipped with cold storage facility was more interested in the export market. Sachin and Virag have set their sights high. They aim to sell mushrooms in a very big way all over India. Mushrooms have a great market potential and is a perishable food.

Questions
A. How will you advise Sachin and Virag, as how to increase the consumer
awareness about this new food?
B. What would be your suggestions for distribution channel for mushrooms?

Possible Solutions
Answer A

• Consumer awareness can be created by test marketing. Through sales persons and customer response to the product.

• Samples can be distributed in big malls and Variety stores.

• Awareness can also be created through outdoor publicity such as wall hoardings, banners, insertions in news papers etc.

• Household sector

• Restaurants

• Industrial canteens

• Brand name of the company along with the product can also be highlighted to the customer by using the concept of event marketing. For different kinds of selling modes they can target different customers Institutional sale: Hotel / Restaurants/Industrial canteens Individual sale: Household
• Approach to hotel industry can be made and product benefit can be shown to convince the customer. Mushroom related recipe booklet can be given to them for use. Can approach the T.V programs for Khana Khazana to show different recipes of Mushrooms in their shows.
• Dealer push through sales promotion campaign. Press meetings can be a way to consumer awareness. Editors, journalists of newspapers having maximum circulation can be contacted and samples to be distributed to them (such as 250 gm or 100 gm packs).
• Packaging should be attractive.

Answer B:

Distribution network:

• Product having being perishable, company should go for faster and effective distribution network having cold storage facility.

• Distribution through company delivery vans in local market and distribution through rail or road transport to urban markets.