Shakarganj Foods

Products Ltd
(Good Milk)
[The Market Plan Analysis ]

By:
Omair Shahid Nagi
Ahmad Farooq Butt
Arooj Naseem
Zaira Hassan

Date: 4/12/2009

University of
Management &
Technology
Shakarganj Food Products
Ltd
(GOOD MILK)

-2-
Contents
Introduction of Company...........................................................................................4
Vision & Mission of Company..................................................................................4
Current Market Situation Analysis.............................................................................7
Marketing Goals & Objectives (SMART) ...............................................................9
Hierarchy Details Of Sales Department of Good Milk ..........................................10
Market Segmentation & Targeting Strategy ..........................................................10
FAB Analysis, Product Line – Product Depth .......................................................13
Pricing Strategy ......................................................................................................14
Market Distribution and Channel Strategy ...........................................................14
Competitive Position................................................................................................16
Marketing Strategies ...............................................................................................19
Marketing Financials .............................................................................................19
Problem Analysis ....................................................................................................20
Rectification.............................................................................................................22

-3-
 Shakarganj Food Products
Limited

Introduction of Company

SFPL is a public limited company (unquoted) set up by the Crescent

Group with the objective to diversify its business activities. The group
has been conducting business in the region for over 100 years and
has a varied industry portfolio in sugar, textile, steel and farming. Its
head office is located at Lahore, Pakistan while the production plants
are in central Punjab - the main fruit growing and milk supplying
region of the country.

The company is professionally run by experienced management. The

CEO of the company is also the serving Chairman of the Pakistan
Dairy Association. SFPL's human resource has a vast experience in
the dairy and food industries. Continuous development and skill
enhancement are an integral part of the employee development
program at Shakarganj. Shakarganj is working hand in hand with the
Dairy Industry of Pakistan to improve milk productivity and animal

Vision & Mission of Company

health.

“Shakarganj Food Products Limited

strives to be among the leading
companies in the food industry and
is committed to manufacturing and

-4-
selling consistent, high quality world class
products”

-5-
-6-
Current Market Situation Analysis
GAP & SWOT Analysis

SWOT Analysis
Lid
Strengths:
The strengths of Shakarganj Good Milk according to their
marketing plan are:
 Convenient: the product is easy to use. They pack of
Good Milk have a lid for the handiness to the
customers.
 Premium Positioning: the other strength is their
premium positioning of Good Milk. According to them
they are positioning Good Milk in the best way and it is their
strength. They are engaging in the kind of advertisement which
make them to position themselves in a unique manner.
 Available Everywhere: they are using the best distribution
strategy and the good milk is available everywhere.

Weaknesses:
The weaknesses of Shakarganj Good Milk according to their market
plan are:
 Budget: the one and only weakness is their low budget then
their competitors.

Opportunities:
 Large Potential Market: according to their market research, 80%
of the total market is using Gwala Milk which is more beneficial
according to them. Shakarganj Good Milk have a large potential
market which is the opportunity to grown their business.

Threats:
The threats for Shakarganj Good Milk are as follows:
 Other Companies: other companies like Nestle, Haleeb and
Olpers are their competitors and the big threats for Shakarganj

-7-
 Food Products Ltd. Their budgets are also higher then
Shakarganj.
 Organized Gwala companies: there are some organized Gwala
Companies which deliver the milk which have low shelf life and
people perceive the milk of low shelf life as a fresh product.

GAP Analysis
In business and economics, gap analysis is a business resource
assessment tool enabling a company to compare its actual
performance with its potential performance. At its core are two
questions: "Where are we?" and "Where do we want to be?" If a
company or organization is under-utilizing its current resources or is
forgoing investment in capital or technology, then it may be producing
or performing at a level below its potential. This concept is similar to
the base case of being below one's production possibilities frontier.

The goal of gap analysis is to identify the gap between the optimized
allocation and integration of the inputs, and the current level of
allocation. This helps provide the company with insight into areas
which could be improved. The gap analysis process involves
determining, documenting and approving the variance between
business requirements and current capabilities. Gap analysis
naturally flows from benchmarking and other assessments. Once the
general expectation of performance in the industry is understood, it is
possible to compare that expectation with the company's current level
of performance. This comparison becomes the gap analysis. Such
analysis can be performed at the strategic or operational level of an
organization.

The management of Shakarganj Foods product Ltd conducted the

GAP Analysis regarding Good Milk (2008) which came up with a very
positive result. According to them their actual performance is better
then their expected performance and they got 20% more then their
goals.

-8-
Marketing Goals & Objectives
(SMART)

SMART OBJECTIVES
All businesses need to set objectives for themselves or for the
products or services they are launching. What does your company,
product or service hope to achieve?
Setting objectives are important; it focuses the company on specific
aims over a period of time and can motivate staff to meet the
objectives set.
A simple acronym used to set objectives is called SMART objectives.
SMART stands for:
1. Specific – Objectives should specify what they want to achieve.
2. Measurable – You should be able to measure whether you are
meeting the objectives or not.
3. Achievable - Are the objectives you set, achievable and
attainable?
4. Realistic – Can you realistically achieve the objectives with the
resources you have?
5. Time – When do you want to achieve the set objectives?

Marketing Objectives of Shakarganj Good Milk

The marketing objectives of Shakarganj Good Milk are as follows:
1. To gain 8% of Market Share in 2009
2. To create higher recall of our brand among consumers
3. To diversify into other categories of Packed Milk, in the
beginning of 2008 they had 2 categories and now they have 4
4. To Increase in the availability percentage of our brand In the
beginning of year 2008 we had 100 distributors and now we
have 140 distributors
5. To increase the shop coverage over period of year 2009 by 20%
6. To increase our milk processing capacity with the time

-9-
 Hierarchy Details Of Sales
Department of Good Milk

The hierarchy detail of Sales Department of Shakarganj Good Milk is

shown in the following diagram:

Sales Setup
Market Segmentation & Targeting
Organogram
Strategy
CSM

SOM
SCo 1
CA 1

RSM RSM RSM RSM RSM

(PWR) (RWP) (LHE) (KHI) (FBD)

ASM ASM ASM ASM ASM ASM ASM ASM ASM ASM ASM ASM ASM

SOs SOs SOs SOs SOs SOs SOs SOs SOs SOs SOs SOs SOs

Figure 1: The Hierarchy Details of Sales Department, Shakarganj Good Milk 6

- 10 -
It is difficult for any one company to engage in mass production, mass
distribution and mass promotion for its product. The complexities
arise from the proliferation of advertising and distribution channels
and the high costs associated with reaching a mass audience.
Therefore, companies segment the market so that they can target the
group of customers who share similar needs and wants. The milk
sector shows a market that has homogeneous preferences that is the
consumers have similar preferences. They want milk to be white,
carefully processed, and good for health and bones. Keeping these
things in mind Good Milk’s market has been segmented.

Demographic segmentation

Good Milk’s products are not bounded to any particular age, gender
or lifecycle stage. The brand is meant for all the users in higher upper
or middle class families. Even though the brand calls for a small
percentage of an individual’s income but lower class wouldn’t want to
buy the brand maybe because they are price sensitive or because they
believe lose milk is better than processed milk and has all the
nutrients that the processed milk lacks. However all the companies in
the milk sector are trying to change the image of processed milk as
non-nutritionist milk. Therefore it can be said that Good Milk’s has
been positioned as a brand for high income earners. Due to the
income factor involved it can be said that Good Milk’s milk target a
specific social class who are health conscious and concerned about
their weight.

Psychographic segmentation

On the basis of psychographics, factors such as personality traits,

lifestyles and values, the marketers at Good Milk’s have segmented
the market more towards achievers who are goal-oriented and focused
on their careers, and experiencers those who are seeking variety in
the milk sector. The Good Milk’s products have targeted experiencers
because the company has given them a new set of brand and so many
will make their first purchase because they want to try something
new. Good Milk’s ads also target believers, traditional conservative
people with concrete beliefs. The ads for Good Milk’s show the beliefs
of healthy life with processed milk and plays on the emotional aspect
more.

Behavioral segmentation
Good Milk’s products have been segmented on the basis of benefits
that consumers seek in the milk. In this case, people look for a brand
that can be used for all purposes from drinking to tea whiteners as

- 11 -
well for any other use. The ads also show that consumers should
increase their milk consumption for example with every tea they
should use Good Milk’s, every morning they should drink Good Milk’s
and everyday they should feed their pets with Good Milk’s milk. There
may be some hard core loyal in the milk sector. Loyalty maybe
towards such established brands as Nestle and Haleeb. There might
even be switchers and shifting loyal in the milk sectors that are either
price sensitive or want variety. As a result, the marketers need to find
ways to make the hard core loyal attracted to the Good Milk’s brand
and shifting loyal and switchers to convert into hard core loyal as
well.

Targeting Marketing:
According to the Brand manager of Shakarganj Good Milk their
product (Good Milk) is for everyone and for every purpose. We are
targeting everyone who use our product either child, teenagers, young
adult, elder, male or female, for every use like for tea, coffee, for
cereals, as a plain milk, for shakes or for other milk products.

- 12 -
 FAB Analysis, Product Line – Product
Depth
Sr # Features Advantages Benefits
1 Quality core competency Consumer love
quality
2 Lid on the top Convenient Increase handiness
for customers
3 High calcium Differentiate Good for bones
percentage
4 Safe packaging More healthier then Get more energy
loose milk

Product Line & Depth Strategy

Product Line
(Group of products sharing a common, managed set of features that
satisfy specific needs of a selected market or mission.)
Good Milk Lies in the product line of UHT milk.

Product depth
(The number of product items offered within each product line)
In Shakarganj, there are number of products offered in the product
line of UHT Milk, like Good Milk Slim and Flavored Milks and Chaika.
(for tea)

USP – Unique Selling Preposition

According to the brand manager the USP of our product Good Milk is
its Premium Quality.

- 13 -
Pricing Strategy

According the marketing plan of Shakarganj Good Milk, they are

using Premium Pricing Strategy the reason behind the premium
pricing is that they are producing Premium quality product and they
are doing premium positioning of their product, so, they are using
premium pricing strategy for their product.

Market Distribution and Channel

Strategy

Market Distribution strategy:

Shakarganj Good Milk more prefers the Numerical Distribution
Strategy rather then weighted Distribution Strategy. What they are
doing is that if there are ten shops in a row they will distribute their
product (Good Milk) in all the shops rather then distributing in, say
five shops in bigger quantity.

Market Channel Strategy:

A market channel performs the work of moving goods from producers
to consumers. It overcomes the time, place, and possession gaps that
separate goods and services from those who need or want them. The
producer and the final consumer are the part of every channel.
Shakarganj Good Milk is using all the channel level like:

Zero Level Channel:

Shakarganj is selling their product (Good Milk) directly to the final
customers as they are engage in TV selling, Internet selling and
company owned stores (Fair Price Shops)

- 14 -
One Level:
A one channel contains one selling intermediary such as retailers, and
Shakarganj is using this strategy.

Two Level
Two level channels contain two selling intermediaries and these are
retailers and wholesaler, and SFPL is using this strategy

Three Level Strategy:

Three level channels contain three selling intermediaries and these
are retailers, wholesaler and jobbers, and SFPL is using this strategy.

Manufacturer Manufacturer Manufacturer Manufacturer

Jobbers

Wholesalers Wholesaler

Retailers Retailers Retailers

Consumers Consumers Consumers Consumers

- 15 -
Competitive Position
SWOT Analysis
Core Competencies

SWOT Analysis.

PR with farmers
SHAKARGANJ has been interacting with the farmers for fertilizers and
has gained quite a good reputation over the years. It has led to a
strong bond and long term relationship with the farmers who are
willing to supply milk to the company. This is an added advantage
and strength for the company because it will never be short of milk
production. The farmers also won’t have to look elsewhere to sell their
milk.

Positive response from customers

In first year, SFPL crossed 1.4 billion sales figure which shows
customers’ satisfaction upon SFPL’s products. Its taste, quality
proposition and world-class quality proposition system.

Strong consumer & product research

Good Milk’s done a strong consumer & product research before and
after launching the product. This has provided them the perfect
launching pad to eventually emerge as a global player in the food
industry. To develop its future portfolios, SFPL has hired various
global research partners like AC Nielsen, Mindshare, JWT Asiatic and
MARS marketing and advertising agencies.

Latest Plant
SFPL has the Latest UHT milk plant. SFPL plant is the plant in
Pakistan that uses Bactofuge technology to virtually eliminate bacteria
and ensure premium quality and hygiene.

- 16 -
Weaknesses
Low Quality Milk
SFPL is not having its own dairy farms; it largely collects loose milk
from farmers & gwalas through its 40 milk collection centers, which
sometimes is of low quality and impure because they add vegetable oil
to milk to get higher prices.

Packaging
SFPL is dependent upon Tetra Pak for the packaging of its entire dairy
products. Tetra Pak is the only option available to Good Milk’s for
packaging because it is having monopoly in the packaging sector in
Pakistan. Due to this reason, Tetra Pak can charge them higher and it
could increase the production costs.

Milk collection & distribution costs

SFPL’s 34 out of 40 milk-collection centers are located in Punjab,
whereas its only milk processing facility is situated at Jaranwala, near
Faisalabad. It increases the milk collection & distribution costs; and
also increases the chances of milk getting spoiled because of
increased traveling time.

Opportunities

Increased funding by Government

Government has decided to increase farmers’ funding. This is an
opportunity for SHAKARGANJ foods because previously due to
weather conditions and other reasons there was lots of wastage of
milk but now that can be reduced as farmers will be better able to
store milk for longer time periods.

Increased consumption of PLM

Competition may create opportunities for the company because each
competitor in the milk industry wants to increase penetration of
processed liquid milk and so they will create awareness for consumers
through different advertising media. This will ensure the increase in
the consumption of processed milk instead of lose milk and so will in
turn lead to increase in sales for the company. Therefore there will be
an opportunity for accelerated growth.

Awareness
Growing dissatisfaction with loose milk and increasing awareness
about health and hygiene issues have led to increased processed milk
consumption.

- 17 -
Threats

Competition
Competition may pose a threat because the company will have to
maintain its leadership in an expanding market so that it doesn’t lose
its market share to its competitors. For Good Milk’s it might be
difficult to penetrate in a market where the loyalties exist for such
brands as Nestle and Haleeb. These brands have been in the milk
industry far too long and have left a mark in the minds of consumers
in terms of quality. Competition seems to be getting tougher as a
result of new players entering the dairy market.

Perceptions and Price Differentials

Consumers’ perceptions and price differentials can cause a threat for
the company. It is important that Good Milk’s comes up to the
expectations of the customers and fulfills its conformance quality that
is the company meets its promised specifications. Consumer’s
preferences change with time and prices might create certain barriers
in terms of the profit margins for Good Milk’s. For example, lose milk
is still cheaper than packaged milk and that is also one factor that
people still prefer to buy lose milk.

Core Competencies
Core competency is something that a firm can do well and that meets
the following three conditions:

1. It provides consumer benefits

2. It is not easy for competitors to imitate
3. It can be leveraged widely to many products and markets.

A core competency can take various forms, including

technical/subject matter know how, a reliable process, and/or close
relationships with customers and suppliers (Mascarenhas et al.
1998). It may also include product development or culture, such as
employee dedication.

Core competencies are particular strengths relative to other

organizations in the industry which provide the fundamental basis for
the provision of added value.

- 18 -
According to Brand Manager of Good Milk, Mr. Sajid Sufi the core
competencies of Shakarganj Good Milk are:

1. Milk Collection System: the milk collection system of Good Milk

is according to them is the one core competency of SFPL.
2. Good Packaging: the packaging is another core competency of
SFPL as it is very safe and reliable.

Key Success Factors

According to the company the key success factors are:
Slow & Steady Progress
Solid relations with their suppliers, distributors, partners and
consumers

Marketing Strategies
According to the marketing goals of Shakarganj Good Milk, they want
to increase their market share and increase the sale volume by
entering new segments and by introducing new products, actually
they are in the growth stage and they are using the following
strategies to gain market share:

1. They are improving the distribution strategy

2. They are increasing the shop coverage
3. They are improving the distribution channels.
4. They are improving the product quality and its features
5. They are adding flavors to their main product (Good Milk).
6. They are introducing new products
7. They are entering new market segments
8. They are spending nearly same amount on promotions schemes

Marketing Financials
- 19 -
Marketing financials is a very confidential thing which can not be
known by the people outside the organizations and it is the
responsibility of the employees takes care of this information.

We have been given a rough idea about the marketing financials of

Shakarganj Good Milk. The marketing financials of Shakarganj Good
Milk is about Rs 100 million.

Problem Analysis

The problem analysis according to the

Company:

The problems that are being face by the company are discussed above
in the section of SWOT Analysis (Threats & Weaknesses)

The problem analysis according to our Group:

Good milk lacks a powerful brand name.

Good milk is good as a milk choice but its name is not good. For all
stakeholders it’s sure, that good milk will not play in short innings.
The brand name endorses the product and boosts its life over a long
period. However, good milk came up with a low naming that can not
hook customer mind for long. In the short term, they just need good
milk’s Positioning and a new market creation to survive, yet survival
is not enough. When this mission is successfully accomplished, the
next mission is to feed brand for the long term.

Customers get sophisticated with the passage of time, they learn and
adapt. In the long term the brand name is the only weapon to attack
on your competitor to gain market share, the ultimate goal of your
company. Hence, there's only one difference, it's your brand, and your
competitor's brand. All brands provide similar benefits but it’s the
“brand name” that actually effect consumer buying behavior.

- 20 -
Good milk is making big, big, big mistakes in two ways, one is, as you
might suspect, Brand Extension and the other is Generic Names (not
brand names) Good milk is a weak generic name. Here’re Good milk’s
brands, going no where:

1. Cream (generic name)

2. Khalis Desi Ghee (generic name)
3. innow Concentrate (generic name)
4. Mango Puree (generic name)
5. Oolala (brand name, however, Line Extended)
If they had launched these brands with specific brand name, they
would have worked out a good strategy. The "brought to you by Good
milk or Shakarganj" strategy can work and then develop your sibling
brands with separate Positioning.

In early era, generic names did not matter as that was a time of
competition or less competition, but today the environment is ultra
competitive. Good milk should build strong brand name that last for
long.

Shakarganj good milk is an FMCG that stands on almost every

household store shelves.
Good milk has been promoted a lot from the day of its establishment
but still it is facing few problems. The problems are analyzed keeping
in view the fast trends in today’s market and consumer buying
behavior patterns.

• “Roz roz good milk piya kero” the TV ad does not clearly
target to drink SHAKARGANJ GOOD MILK. In analyzing
the competitive market it’s not worthy to promote an ad
with a jingle speaking of good milk only. The ad stresses
on taking milk in any form to boost energy. Again the
generic name affects the promotion.

The holistic marketing approach the concept of societal responsibility

is at forefront. There are advertisement launched by companies for
broader prospects such as ethical, environmental and social context
of marketing activities and programs. Keeping the view of societal
marketing, the good milk ads do not clarify the benefits of drinking
Shakarganj good milk or making a habit of drinking milk is good.

• Another problem faced by good milk is its taste

perception. The taste is bit sweater and its quality feels

- 21 -
 lighter. The after taste of milk is not pleasing. The other
brands milk packs have a similar taste. The perception of
Shakarganj perceives it sweeter in taste

Rectification
RECTIFICATION:

The problems regarding good milk could be rectified if they build a

stronger product image. It’s over the period of time that with
marketing campaigns good milk can stand with better image. It
should emphasize more on the commercial ads as the advertisement
has a direct affect on consumers buying patterns. This is to be sure
that good milk is not playing a short term business; therefore, the
management should be well focused in handling the product.

An effective sales distribution analysis should be drawn and

prime focus must be the ultimate consumer, so that to proof good
milk really GOOD.

- 22 -