Tetra Pak Aims At Tie-Ups With Co-Operative Milk Bodies

The company has been in the red since it floated its 100 per cent Indian subsidiary in 1996 as there have been few takers for its high-cost pouches consisting of aluminium foils and plastic.

Although globally Tetra Pak's revenue comes from selling packaging material to the milk industry, the Indian market contributes only one-third to its revenue.

"The problem we have been facing in India is in the milk segment due to low demand for our packaging material. But Tetra Fino is our low-cost packaging system which help us to reduce the maximum retail price to the consumers," said Stefan Johansson, vice-president, marketing and sales, Tetra Pak India.

 

Tetra Pak pouches are 35 per cent cheaper as against the brick of one litre packages.

Tetra Pak has inked a pact with the Karnataka Milk Federation Union for its Tetra Fino pouches, while it has roped in Vijaya Milk to sell its milk in Tetra Fino.

"We also see room to sell successfully in north India and other parts of south India our Tetra Fino pouches to milk producers both in the co-operative and private sector," Johansson said.

The company is also looking at packaging Indian ethnic food, like dal, in Tetra Paks. "We will develop the packaging for ethnic foods in the next one year's time and launch in the market next year," Johansson said.

"The perception of Tetra Pak packaging in India is different and its a challenge for us to overcome it," he said.

Another segment the company is keen at targeting is the home channel where most milk is delivered. "We are trying to study the home delivery channel through which most homes get their milk and trying to convince the households and the producers of milk to switch over to Tetra Fino pouches for safety and hygiene," he said.

The main resistance and competition that Tetra Pak faces is from plastic pouches which are 15 per cent cheaper than Tetra Fino at the maximum retail price level.