Specific Things

Strategic Marketing & Planning

Pakistan Spice Industry

Country Spice Production (Billion)

Bangladesh

India

Malaysia

Indonesia

Pakistan

Usage of Spices in Pakistan

Total consumption of Spices in PakistanCategory wise consumptionTotal consumption of Desserts in PakistanCategory wise consumption

Market Size & GrowthGrowth Past 4 YearsAccording to the product category

Market / Product Segment 2011 2011 2012 2013

Growth Future 4 Years

Market / Product Segment 2014 2015 2016 2017


Market Segment According to product category

Segment Life CycleMarket / Product Segment Intro Growth Maturity Decline

Product Life CycleFor each product in the category

Product Life CycleMarket / Product Segment Intro Growth Maturity Decline


Distribution Structure

2014 Turnover Share

Market / Product Segment Distributor / Retail

Distributor/ Wholesaler

Food Services/ Distributo

r80% 20% 70% 30% 70% 20% 60% 40%

5% 95%85% 15% 95% 5%

100%

Analysis Distribution Structure


Companies & Competitors Market Share per Segment

Per product in each category

Market / Product Segment Market Share Quantity Market Share Value Market Share %tons ‘000 %

Nestle Outlet Coverage and Market Reach


Shan Outlet Coverage

Outlets A B C D Total

Total OutletsNestle Outlets

Outlet CoverageOutlets Contribution

Outlet Coverage Market ReachShan Benchmark Shan Benchmark

Nestle Area wise Market Coverage

The table below shows the % of revenue that is generated from different areas for all the diary products Nestle has

Areas Percentage Contribution

Spices DessertsKarachi

F.S. SouthCostal Belt

QuettaHyderabad

SukkarLahore

F.S.CenterMultan

FaisalabadGujrat

SahiwalIslamabadF.S.North

Islamabad OutstationPeshawar Outstation

Peshawar


RATING AGAINST CUSTOMER BUYING CRITERIAThe table below suggests what is the weight age customer gives to each of the non

priced attributes and how is Nestle and Haleeb performing against them

QUALITY & PRICE Nestlé Haleeb

Non Price Attributes affecting Customer Choice

WEIGHTAGE%

Product-Related %

1. Quality (Thickness)2. Packaging (Cap)3. Packaging (Material Used)4. Price5. Brand Name

Service- Related

1. Distribution2. After Sales Service


Key Process Indicators (I want to develop this for Shan)

Supply Chain

Plant Utilization : This KPI tells how optimally plant is used

Machine Downtime : This KPI indicates what is the average down time of the machine per month.

Liters Processed Per Day : Indicates how many liters of milk are processed per day.

Production Cost Per Liter : This is very important KPI which indicates the cost of production per liter.

KPIs Industry Benchmarks

Where Are We?

Improvement Plan I Improvement Plan II

Plant Utilization

90% 100% Install new production plant

Machine Down Time

2 Hours 2.5 Hrs They should have separate machines for Juices and Milk Processing so that down time is decreased.

Liters Processed Per Day

450,000 Liters

450,000 Same as Above Improve the milk collection system

Production Cost Per Liter

28 28 Installing new plants in Tax Free Zones would decrease cost of production.

By installing new technology machine cost of production can go down by at least 40%

Financials

Revenue Per Employee : This tells what is the contribution of each employee in revenue generation of the company.

Gross Profit Margin : Very common financial KPI which indicates the companies gross profit margin.


Where Are We?

Improvement Plan I

Improvement Plan II

EBITA 1,186,853,000Revenue Per Employee

1,249,318 This can be greatly improved by trainings and certifications.

Planning to install WBI Monitors this actually monitors the screen of the person and indicates his efficiency

Gross Profit Margin

2,740,187,000 This can be greatly improved


by decreasing cost of distribution and cost of production.

Human Resource ManagementCost to Hire : Indicates what is the cost of hiring each employee, here the cost of recruitment department is divided by number of hires in a year.

Turnover Rate : What is the turn over rate of employees.

Salary Packages : Are salary packages attractive.


Where Are We?

Improvement Plan I

Improvement Plan II

Cost to Hire 60,000 They plan to have contract with World Call and use there bandwidth services for Video Conferencing rather then asking them to fly all the way to Lahore

Turnover Rate 0 12 They do have the best retention rate in industry but this can be further improved by offering more incentives and providing healthier environment

Salary Packages Excellent Share profits with key employees so that they are motivated in achieving organizational profits.

Sales

Average Sales Per Salesman : What is the average sales per salesman, this tells how efficient the salesman are.

Percentage Growth Every Year : What is the growth rate of the company?



Where Are We?

Improvement Plan I

Improvement Plan II

Average Sales Per Salesman

They are the leaders

Rs 133,333 Per Day

Though they are lading but this can be greatly improved if online order management system is placed then they would need less salesmen as compared to now.

Percentage Growth Every Year

25% 23% Due to plant capacity being used Nestle is not able to catch up with industry benchmark so if new plant is installed Nestle can also cross the Industry Standards

Market Reach 42% 56%

Distribution

Empty Running : For how much time the vehicle was empty running

Time Utilization : For how much time the vehicle was utilized

Deviations From Schedule : What is the percentage deviation from scheduled delivery.

Liters Delivered Per Day : How many liters were distributed in a day

Distribution Cost Per Liter : What is the average cost of distribution per liter


Where Are We?

Improvement Plan I

Improvement Plan II

Spoiled Milk Distribution

3% 0.9% Improve packaging

Improve distribution time.

Empty RunningTime UtilizationDeviations from ScheduleLiters Delivered Per DayDistribution Cost Per Liter

Brand

Brand Loyalty : How many customers are brand loyal with the product?


Brand Awareness : Indicates what is the brand awareness of the product?


Where Are We?

Improvement Plan I

Improvement Plan II

Brand Loyalty 40% 55% Improve quality standards and provide healthier milk

Improve packaging to bring down wastage of milk

Brand Awareness

75% 90% Increase marketing campaigns and get your product on the shelf.

Get more aggressive in BTL activities.


Category wise objectives

Brand Objectives 2014 2020Shan Spice Volume 155,000 tons 550,000 tons RIG 24% Market Share 53% 57% EBITA 5% – 6% 10% Unprompted Brand Awareness 60% 90%Shan Desserts Volume 10,000 tons 50,000 tons EBITA 24% 30% RIG 25% 30%

.


Market Segmentation and Product Positioning (want to develop this for Shan)

SegmentSize in Tons

GrowthProduct Existing

Profit Contribution in

RS. Objectives New ProductExpecte

d

Drinking

268,920

20%

Milkpak UHT 537840000

New Variant, Get more share from Gawala’s,

Increase EBITNesPure

235,305 Haleeb 47061000022,410 Candia 39217500

11,205 Dairy Queen 25211250

22,410 Others 3921750010,644,750 Gawala 37256625000

Tea Whitenin

g / Creaming

43,497

24%

Everyday Powder 173988000

Get More Share from Gawala, Increase Target Market of

EverydayNone

26,098 Everyday UHT 65245000

113,092 Milkpak UHT 226184000

130,491 Haleeb 26098200034,798 Tea Max 6959600017,399 Comel 521970008,699 Candia 15223250

34,798 Dairy Queen 78295500

26,098 Others 456715008,264,430 Gawala 28925505000

Deserts

18,360

20%

Everyday UHT 73440000

Sustain current performance and try to

increase the market share.

None

36,720 Milkpak UHT 73440000

27,540 Milkpak Cream 82620000

50,490 Haleeb 1009800004,590 Comel 13770000

4,452,300 Gawala 17809200000

Infant Nutrition 8,208 24% Nido 49248000 Increase sales by 25%. More SKU’s

Corporate

31,590

20%

Everyday Powder 126360000 Increase client base.

Open processed milk and powder.

24,300 Milkpak 48600000 Reduce cost by cutting down on packaging.

29,160 Haleeb 583200002,344,950 Gawala 9379800000

Health Conscious

64,125 25% Nesvitta 224437500 Create More awareness and increase market

share13,500 Skimz 33750000


Flavored 22,000 4% Imported 66000000 Tap this market with new products

Nestle Flavored Milk

Exports No Limits - Smuggling Varies from country to country

Tap this market with Nestle Existing

ProductsAll Nestle Brands


Companies Positioning Against Competition (want to develop this for Shan)The table below is a competitor profile of two dairy giants in Pakistan Dairy Industry.

Parameters Nestle Haleeb

Product Life Cycle Growth GrowthCompany Size Rs 5,832.000,000 Rs 3,888,000,000Distribution 56% 59%

Product Portfolio

Milk Pak UHTMilk Pak CreamEveryday UHTEveryday PowderNidoNesvittan

Haleeb UHTDairy QueenCandiaTea MaxSkimz

Customer BaseDrinking , Tea Whitening, Health Conscious, Deserts

Drinking , Tea Whitening, Health Conscious, Deserts

Marketing Operations Excellent Average

Production Capacity77 % Utilized (450,000 Liters Per Day)

90% Utilized(300,000 Liters Per Day)

Human Resource Deployment 870 450Financial Capabilities High MediocreBrand Ownership High MediocreManager’s Capabilities Experienced Experienced


Product \ New Product Plan

Current Scenario

Product Market Segment Positioning When Who Expected Results

Milkpak UHT

DrinkingKhalis he sub

kuch haiTea Whitening /

CreamingDeserts

Corporate

Every Day powder

Tea Whitening / Creaming Har achi

cheez mehangi

nahin hoti

Corporate

Every Day UHTTea Whitening /

CreamingDeserts

Milkpak Cream DesertsSab say Gaarhe Cream

Nido Infant Nutrition

For Growing Healthy

Children, Complete Notional Formula

Nesvitta Health Conscious High Calcium Low Fat Milk


Future Plan

Product Market Segment Positioning When Who Expected

Results

Milkpak UHT

DrinkingPakistan’s No-1 Dairy Milk Brand

End of 2005Senior

Management

Position in eyes of

consumer as the No. 1 Dairy

Brand

Tea Whitening / CreamingDeserts

CorporateExport

Every Day powder

Tea Whitening / Creaming Tea was never so irresistible

Mid of 2006Senior

Management

Achieve Sales and Brand

Objectives for Next 2 Years

CorporateExports

Every Day UHT Tea Whitening / Creaming

Tea was never so

irresistibleMid of 2006

Senior Manageme

nt

Achieve Sales and Brand

Objectives for Next 2 Years

Milkpak Cream Deserts

Aap kee yadon ko

aur meetha banaye

End of 2005 Brand Manager

To position themselves as

the only specialized cream for deserts

Nido Infant NutritionNIDO

Generation – Healthier Generation

End of 2006Senior

Management

To continue to cater this

market single handedly

Nesvitta Health ConsciousThe key to

healthy Life

Mid of 2006Senior

Management

To increase its market and

create health awareness

Nestle Flavored Milk Flavored Milk Life is

Colourful Mid of 2006New

Business Unit

To tap this new market

segment and be the first

flavored local milk

NesPure Drinking, Tea Whitening

Enjoy the real

pleasure of drinking Gaarha doodh

End of 2005New

Business Unit

To increase market share

by adding variant


Action Planning

What How Who When

ProductionIncrease Production

By setting up a new plant Nestle End of 2005

DistributionCome up with new distributions channels

internet, home delivery Nestle End of 2006

Lower Distribution Cost

Building Mini NDC’s in major cities to

stop product shortages.

Nestle End of 2005

New Product \ RepositioningCome up with New Product for Flavored Milk Segment

Nestle Flavored Milk Nestle Dairy Mid of 2006

Come up with New Product for Garha Doodh Segment

Nespure Nestle Dairy End of 2005

Reposition Nestle Milk Pak

Pakistan’s No-1 Dairy Milk Brand Nestle Dairy End of 2005

Reposition Everyday

Tea was never so irresistible Nestle Dairy Mid of 2006

Reposition Milkpak Cream

Aap Kee Yadon Koi aur meetha banaye

Nestle Dairy End of 2005

Reposition Nido NIDO Generation – Healthier

Generation

Nestle DAiry End of 2006

Reposition Nesvitta

The key to healthy Life

Nestle Dairy Mid of 2006

Production \ Milk CollectionLower Production Cost

Buy raw milk from India if relationships improve

Nestle As soon as relationships

improve

Milk Collection Improvement

Have budgets for better breading and feeding of cows to increase productivity.

Nestle By End of 2005


Product DevelopmentNestle a disposable drink

¼ Liter packs would have straws attached, so one could drink milk on the go.

Nestle By End 0f 2006

Packaging Improvement

Packaging of current Nestle products would be revitalized. Caps would be added to UHT packages which would decrease milk wastages

Nestle By End of 2005

Documents

Specific Things