Engro Foods Project (OLPER)

8/13/2019 Engro Foods Project (OLPER)

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Engro Foods History

Engro Foods (Pvt.) Limited (EFL) has been established in 2005 as part of a

diversification process at the Engro Group. he plant located at !u""ur on 2# acre land$

has the ra% mil" reception capabilit& of #00$000 liters per da& and ' mil" capacit& of

200$000 liters per da&.

he plant has been established at a cost of s. * billion %hich provides direct

emplo&ment to +50 people. Engro Foods has entered the Food business through mil"

processing and sale %ith the compan&,s vision to pursue gro%th opportunities based on

countr& fundamentals and o%n strength.

-t also positions the compan& to leverage its corporate social responsibilit& initiatives and

%or" closel& %ith rural communities to promote integrated farming and livestoc"

development. his effort is epected to pla& a pivotal role in povert& alleviation and

improving livelihoods of the poor in the mil" collection areas.

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Vision

/ur vision is to become a fast epanding mega foods compan&. o achieve our vision$

the compan& %ill initiall& focus on dair& b& investing a substantial amount in plant$ mil"

collection capabilit& and mar"eting. 1e are ma"ing concrete efforts to epand in and

be&ond Pa"istan through strategic international alliances$ to eventuall& become global./

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Mission Statement

To be one of the biggest players in the food business, our mission is to dominate

the food business and to achieve this we will settle for nothing less than the

cream

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Business Analysis of Engro Foods Limited

Engro Foods is a subsidiar& compan& of Engro chemicals currentl& running different

business. First the& entered in the mar"et %ith the fertili3ers and chemical business and

then further epanded their business to%ards dair& side.

heir business portfolios are as follo%s.

Engro Fertili3er Limited

Engro E4-P Ltd

Engroanagement !ervices Ltd

EngroPo%erGenLtd.

Engro Foods Limited

1ith their affiliates$

Engro 6opa"

Engro Pol&mer 7 8hemicals Ltd (Formerl& Engro 9sahi)

969:8E: (Formerl& Engro -nnovative)

Engro Energ&

Engro Foods is currentl& having 5 products running in the mar"et

lper,s

arang

l%ell

more

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+) $once!t Deelo!ment and %esting

9n attractive idea must be developed into a product concept.

9 product concept is a detailed version of the idea stated in meaningful consumer terms.

his stage has t%o parts i.e.$ concept development and testing.

8oncept testing is testing ne% Aproduct concepts %ith a group of target consumers to find

out if the concepts have strong consumer appeal.

,) Mar&eting Strategy Deelo!ment

ar"eting strateg& development is designing an initial

mar"eting strateg& for introducing product to the mar"et.

-t consists of three parts. First part describes the target mar"et the planned product

positioning and the sales$ mar"et share$ and profit goals for the first fe% &ears.

he second part of the mar"eting strateg& statement outlines the product,s planned price$

distribution$ and mar"eting budget for the first &ear.

he third part of the mar"eting strateg& statement describes the planned long?run sales$

profit goals$ and mar"eting mi strateg&.

-) Business Analysis

Business anal&sis involves a revie% of the sales$ cost and profit

pro>ections for a ne% product to find out %hether the& satisf& the compan&,s ob>ectives.

-f the& do the product can move to the product development stage.

.) Product Deelo!ment

-f the product concept passes the business test$ it moves into

product development. ere 7C or engineering develops the product concept into a

ph&sical product.


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/) %est Mar&eting

-f the product passes concept and product tests$ the net step is

test mar"eting$ the stage in %hich the product and mar"eting program are introduced into

more realistic mar"et settings. est mar"eting gives the mar"eter eperience %ith

mar"eting the product before going to the great epense of full introduction.

0) $ommerciali'ation

est mar"eting gives the management the information needed to

ma"e a final decision about %hether to launch the ne% product. -f the compan& goes

ahead %ith commerciali3ation$ introducing the ne% product into the mar"et$ it %ill face

high costs.

8ommerciali3ation is the process of introducing the ne% product into the mar"et. -t

consists of advertisement$ sales promotion and other mar"eting efforts.

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Deelo!ment of New Product

1l!ers

Engro Foods Limited

"dea #eneration

Engro chemical %as leading in fertili3er and chemicals in

Pa"istan from man& &ears. he& decided to enter in the ne% portfolio. EFL conducted

formal research in dair&$ fro3en foods and snac"s %ithin organi3ation and as %ell as used

eternal sources and collected suggestions and ideas from customers.

EFL found more opportunities in dair& as Pa"istan is the # rdlargest mil" producing countr&

in the %orld. 'sage of ' ('ltra heat treated) mil" %as *# D till 200# in overall Pa"istan

mar"et. !o the& found that the& have =+ D opportunit& in the dair& business %ith compan&

name Engro Foods Limited.

"dea Screening

9fter having came to "no% that the& have such a big

opportunit& in the dair& sector$ Engro Foods decided that the& should ma"e ' mil"$ and

target upper and upper middle class people. he& decided to compete other brands li"e

:estle il"pac"$ Good il" and aleeb %ith better @ualit& and this all process %ould be

complete %ithin t%o to three &ears.

$once!t Deelo!ment and %esting

Before the inceptions of the brand 9c. :elson carried out a

mar"eting research for EFL to determine the viabilit& of the brand name lper,s. *200

named %ere revie%ed and anal&3ed before lper,s %as decided. 9ttribute positioning for

lper,s$ aleeb is for tea$ :estle for drin"ing$ no mil" for all of the purposes$ but lper,s is

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for all purpose. hen EFL presented it to target customers for testing the concept oflper,s.

Mar&eting Strategy Deelo!ment

he& developed their ne% product lper,s. he& settled the

price b& loo"ing at their competitors. Full cream mil"$ use of red color$ lper,s means all

purpose mil" for the %hole famil&. Price %ould be comparativel& less then others.

-ntensive mar"eting %ould be in 5 regions arachi$ Lahore$ -slamabad$ Pesha%ar and

ultan. EFL has its o%n sales and distribution net%or" and their goal is to become the

mar"et leader.

Business Analysis

EFL is subsidiar& of Engro 8hemical Pa"istan Ltd$ %hich is

one of the most reputed enterprises in Pa"istan %ith more than ;0 &ears of diversified

business operations in the areas of fertili3er and chemicals$ and leading the mar"et and then

decided to enter in food business.

1hen the& started their business aleeb %as getting ;#D mar"et share$ :estle ;;D and

remaining to the others.

:o% after the success of lpers$ :estle has #D of mar"et share$ lpers has #+D$ aleeb

has *=D and rest of the mar"er share to the remaining products.


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Pricing Strategies

Engro Foods is persuing the competitive pricing strateg& for its products. -n competitive

pricing the price of the product is determined considering the price of ma>or competitors

li"e :estle$ aleeb etc.

EFL adopted the mar"et penetration pricing strateg& to get profit in long term. he&

%or"ed on the phenomenon of competitive pricing and same high @ualit& as compared to

their competitors. heir target is to get maimum mar"et share.

9nother hurdle in converting loose mil" users to processed li@uid mil" is price. -n Pun>ab$

because most dair& farms are based there$ loose mil" is cheap at approimatel& s 20 per

liter$ %hile processed mil" is priced at approimatel& s #= per liter. -n !indh$ ho%ever$ the

price differential bet%een loose (s 2=) and processed mil" (s #=) is onl& s *0. 9s a result

of price considerations$ most PL8s have not increased prices in the last 5 &ears.

oreover$ :estle and aleeb have introduced smaller pac"ages to cater to consumers %ith

limited cash flo%s$ although there is a convenience factor at pla& here as %ell.

EFL introduced three t&pes of pac"s in the mar"et 250 ml$ 500 ml and *000 ml as per

famil& re@uirements.

*000 ml for large famil&

500ml for middle famil&

250ml for small famil&

he& set these prices b& loo"ing at the prices of their competitors i.e. :estle and aleeb.

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Allowance

9t the start %hen the& introduced their product in the mar"et the& gave allo%ance to their

%holesalers and retailers$ b& providing # D off on one crate.

o maintain high @ualit& of their product$ EFL added some "ind of flavor in their mil" to

"eep the smell of mil" a%a& and to distinguish their product from aleeb and il"pac".

he& also have in mind the phenomenon of reference pricing. he& "no% that customers

%ho are using :estle and aleeb have in mind their prices so the& decided to deliver their

product in the mar"et %ith the same price and better @ualit&.

$urrent Prices

he current prices of the EFL,s lper,s and its competitors are given b& the table belo%.

Si'e 2ml3 Prices 24s3

1l!ers Nestle Mil&!ac& Halee5

(666 -- -- --

-66 +* +* +*

*-6 (- (- (-

EFL ad>usted their price to the price of their competitors but not compromising on the

@ualit& of their mil".

!ome of the companies are %or"ing on the phenomenon of Lo% price and Lo% @ualit&$

some on igh price and Lo% @ualit&.

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But due the competition in the mar"et and due to the image of people in the mind of theconsumers it %as a challenge for the EFL team to introduce their product in the mar"et

but the& have done it superbl& so far.

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Placement Strategies

9ccording to the ar"eting anager of the EFL$ -n order to succeed$ &ou should

9L19H! capitali3e on &our !E:G! and :E6E on &our 1E9:E!!IJ

9ccording to the !1 anal&sis the& performed$ EFL team came to "no% that the& have

a ver& good P %ith their farmers. he& did eactl& as their ar"eting anager said.

he& used their decades of P %ith farmers and used it to provide %orld?class suppl&?

chain management for delivering the ultimate @ualit& mil" in Pa"istan.

aving "ic"ed off simultaneousl& in 20 cities across Pa"istan$ the launch has been

ambitious and currentl& lper,s is available in =0 cities across Pa"istan. -t reflects the

compan&,s intention to become a big pla&er in the industr&$ both on national and

international level.

Engro Foods Limited has its o%n dale and distribution net%or". EFL has divided

Pa"istan into five regions for mil" distribution namel&K arachi$ Lahore$ -slamabad$

Pesha%ar and ultan.

Cue to an appealing color scheme %hich stand out in the clutter and than"s to the EFL,s

strong relationship building and special discounts to retail outlets$ olper,s has gained a

proper shelf placement in the presence of competitors li"e :estle and aleeb.

Launched on arch 20$ 200


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he& also tells the EFL about the li"ings and disli"ing of the customers. he& spreadinformation about the compan& to the customers so that it can create an image of EFL in

the minds of consumer.

9are7ouses and %rans!ortation

EFl is using transportation li"e truc"s to deliver their product to the target mar"ets and to

deliver their products to the distributors.

here is also a competition among the distributors of EFL. he one %ho give the

maimum sales %ill be a%arded grand pri3e. 9nd %ill be announced as the best

distributor of the &ear. his channel conflict is l&ing among the different distributors of

EFL.

he channel %hich Engro Foods using is the indirect mar"eting channel. Ever&

distributor is earning his o%n individual profit.

here are different %arehouses of distributors of Engro Foods %or"ing in their areas to

store the product and it is also "ept in mind that the management should be up to the date

according to the mar"et re@uirements. :either more nor less should be delivered to the

mar"et so that customers can get the maimum satisfaction.

-n first &ear$ EFL crossed *.; billion sales figure %hich sho%s customers, satisfaction

upon EFL,s products.

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Adertisement

n 20tharch$ 200< lper,s has been launched into the mar"et. lper,s launch %as$perhaps one of the most aggressive as far as processed li@uid mil" (PL) is concerned$

%ith 68s$ print ads$ radio commercials$ billboards and plent& of BL (belo% the line)

activities including direct consumer and shop branding activities. Cue to this aggressive

mar"eting campaign$ the competition seems to be getting tougher.

his can be gauged from the fact that :estle re?launched its product pac"aging and

mar"eting campaign >ust before lper,s launch. ne can also a far greater number of

mil" advertising billboards in a%alpindi cit& than seen earlier li"e of aleeb$ good mil"

and :estle.

Body $o!y:

9it7 1l!ers Mil& Limited

Edition Pac& we ;oin you in t7e

cele5rations of 4amadan)

En;oy t7e full cream goodness

of Premium


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edia mi for lper,s mil" includes 6$ print$ outdoor$ radio 7 BL activities. lper,s

considers radio still an effective medium because 9 7 B house %ives still listen to the

radio on a dail& basis.

-n ever& advertisement of lper,s the& represent a famil& environment in %hich the mil"

is being used for different puposes. !o through that advertisements the& %ant to conve&

the message that olpers is all purpose mil".

lper,s itself is a ver& distinctive name that is eas& to remember and one that %ill sta&

in the memor& for a long period of time. -t even serves to enhance the image of the brandas all?purpose mil".

he brand has been positioned as an all purpose mil" that is meant for ever&one$

especiall& for those %ho live life to the fullest$ hence its tag line$ jo dil khol kay jeetay

hain unheen kay liyay hai Olpers

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he uni@ue selling proposition for lper,s isK Subah Bakhair Zindagi$ but recentl& the

compan& changed the '!P toKJo dil khol kay jeetay hain unheen kay liyay hai Olpers.

Both the tag lines have a ver& positive impact on lper,s image because of the emotions

involved in both the lines.

Promotion

For the promotion of lper,s EFL selected a ma>or tool %hich is advertising.

9t the launch of lper,s the main ob>ective of EFL %as that the& %ant to develop the

better image if lper,s in the minds of target consumers %ho are using the mil" of :estle

and aleeb (the big competitors)$ so that the& could achieve the maimum mar"et share.

EFL passed *0 million s for the advertisement and estimated that EFL can increase

lper,s sale b& 50 D ? +0 D. EFL anal&3ed that aleeb and il"pac" used a large

amount on advertising$ so the& decided that the& %ill also spend lot of amount in

advertisement.

Promotional $am!aigns

Engro Foods is currentl& running different promotional campaigns of lper,s in different

cities. :o% a da&s their campaign named 6eni3aJ is currentl& running in the mar"et. -ts

ob>ective is to provide information the consumers about the all purpose use of the lper,s

mil".

Media Selection

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EFL decided that the& %ill use electronic as %ell as print media support for

advertisement.

9fter launching lper,s at 20tharch$ 200ective is to stimulate both direct and indirect action.

hrough their promotional campaigns li"e the ones during am3an and other%ise$ the&

tr& to get a direct response from people to motivate them to bu&.

-ndirect action is mostl& the case %here the& are tr&ing to create favorable attitudes

to%ards the brand lper,s.

he message strateg& of EFL %as that lper,s is all purpose mil" and is for the %hole

famil&. he& used their slogan jo dil khol k jetey hain un k liay hai olpers

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herefore$ through their tremendous advertisement and promotion strateg& Engro Foods

become able to capture the #0 D of mar"et share and the& are still going on %ith high

hopes to become the mar"et leader.

$onclusions

From this pro>ect it is concluded that Engro Foods after having success in the chemical

industr& decided to epand their business. he& too" help of their team and developed a

ne% product$ all purpose mil"$ lper,s.

he& undergo all the steps of ne% product development to develop their product and then

develop strategies for pricing$ placement and promotion. his %as a great success for

lper,s team that their mar"et share started gro%ing rapidl& and lper,s is a ver& strong

competitor in the business of diar&.

4ecommendations

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9s EFL is on the %a& of success and glor&. ur recommendations are to EFL team that

the& should "eep their hard %or" going and "eep on producing nutritious products.heir advertisement campaigns should also be held in the rural areas of the countr&$

%here people do not "no% much about the ' mil" and also the purit& and taste of

their product.

9s no% the& are targeting the upper and upper middle class the& should also introduce

discounts or ne% pac"s for the lo% class people because benefits should be for ever&one.

9nd %e hope that one da& the& %ill create an image in the minds of those consumers

also.

4eferences

9amir auf$ 9rea !ales anager$ Engro Foods Limited$ a%alpindi

uhammad :asir$ erritor& !ales anager$ Engro Foods Limited$

a%alpindi

Babar ussain$ erritor& !ales anager$ Engro Foods Limited$ a%alpindi.

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Engro Foods Project (OLPER)

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