Look At India For The Long-Run And Not As One-Off Sale: USDA Report
Foreign Agriculture Service of US suggests the in-depths of Indian market customs and etiquette to its exporters, especially leveraging from Make in India campaign, while banking on the current political relation with India. Is this just another report or Indian diplomacy at WTO, agriculture committee has started showing its reflections!
Foreign Agriculture Service in its detailed report continues to suggest its exporters with how to deal with Indian customs and etiquette. FAS says, “Does my product have market access?” is the most important question exporters can ask as they research the Indian market. If yes, then the next thing to consider is ‘Pricing’ – Exporters need to analyse the landed post duty cost of a product.
As a rule of thumb, a product is likely to be two to three times more costly than the U.S. FOB price once it reaches the retail shelf. Consequently, determining whether a product should target the small number of high-income consumers or larger number of middle-income consumers is key in assessing market potential. Exporters should consider whether they are willing to start small, meet special labelling requirements, and ship mixed or partial containers. Patience and persistence are key factors for any exporter or foreign investor who looks towards India as a potential market.
Key considerations with importers/distributors often are on whether they have a city-by-city, region, or pan-India presence; their capabilities and experience in handling fresh, perishable products; and, their interest-level and structure for marketing of your products. Be patient – Be Persistent – Look at India for the Long-Run and not as a One-Off Sale.
The Process Guidance
Guiding its exporters USDA further shares, how India’s trade process on ground works. It says, "for domestically produced foods, clearing and forwarding agents transport merchandise from the factory or warehouse to stockists or distributors". While the agents do not take title to the product, they receive four to six percent margins, then invoice the stockist, and receive payment on behalf of the manufacturer. The stockists have exclusive geographical territories and a sales force that calls on both the wholesalers and on large retailers in urban areas. They usually offer credit to their customers and receive margins in the range of five to seven percent. The wholesalers provide the final link to those rural and smaller retailers who cannot purchase directly from the distributors.
The General Tastes & Preferences
Further to this, the FAS details Indian consumer preferences and says, "Twenty to thirty per cent of the Indian population remains strictly vegetarian in accordance with the tenets of Hinduism. Those Hindus who eat meat tend to do so sparingly, either by choice or due to depressed supplies and distribution, and beef (cow meat) consumption is a taboo among Hindus, Jains, and Sikhs who comprise over 80 per cent of India’s population. Furthermore, non-vegetarian food (i.e., chicken, lamb/mutton, etc.) is not consumed during special days or religious observances. Many of the non vegetarians in India may not eat meat or poultry at home and may consume it only at restaurants or at food service establishments.
