Assessing the Opportunity to Supply Competitively Priced Ingredients for a US Based Manufacturer of Flavours and Fragrances Ingredients

Automotive Management Consulting

Client Challenge

The client, a US based producer of flavour and fragrance ingredients derived from natural and renewable feedstock, was seeking assistance in evaluating the evolving landscape of Indian flavours and the fragrance ingredient market. The client faced a strategic threat of increasing competition in procuring feedstock due to the high volatility in the price of an alternative feedstock. An increase in demand by Western customers for low cost Indian ingredients led Indian producers to scale up their capacities, consequently increasing the demand for feedstock. The client engaged UC Strategy to understand the competitive landscape of flavour and fragrance ingredient producers in India.

Our Approach

To assess the landscape of flavours and fragrances ingredients, UC Strategy created a detailed competitive landscape of the producers in India. This consisted of:

  • Current competitive landscape of flavour and fragrance ingredient producers
  • Historic cost position of feedstock and forecast evolution of feedstock cost
  • Production cost advantages in India, taxes and tariffs structure, margin difference evaluation
  • Strategic intent for shift in feedstock preference
  • Market scenarios with varying feedstock price and demand
  • Historic and planned capacity additions by Indian producers due to increasing demand from the west, for low cost ingredients
  • Indian ingredient manufacturers’ expectations of market demand and evolution
  • Examining likely scenarios for manufacturers to switch to alternative feedstock

Our Impact

A complete 360 degree perspective on the competitive landscape with scenario building and the possible impact under each scenario was delivered to the client. UC Strategy did a cost structure benchmarking and analysed key insights emerging from the analytics. We submitted an evaluation of future feedstock requirements and planned capacity additions of key players in India.



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