Kolson report TABLE OF CONTENTS PAGE NUMBER

1. Letter of Transmittal..2 2. LETTERS OF ACKNOWLEGMENT3 3. KOLSON HISTORY AND BACKGROUND4 4. ORGANIZATION STRUCTURE..6 5. MISSION STATEMENT7 6. COMPANY OBJECTIVES.7 7. PRODUCT LINE AND CATEGORIES.8 8. Total Organized Biscuits Industry..9 9. MARKETING SEGMENTAION10 *TARGET MARKETING..11 * POSITIONING..11 * BRAND POSITIONING.11 * BRAND PERSONALITY11 * MARKET SIZE.11 10. MARKET SHARE12 11. MARKETING MIX..13 12. PRODUCTS..15 13. CRITICAL ANALYSIS..21 14. MARKETING STRATEGY..23 15. MARKETING OBJECTIVES..24 16. RECOMMENDATION25

Kolson report letter of Transmittal

To: From: Date: INFORMATIVE REPORT ON KOLSON (BISCUITS)' We were authorized to submit an informative report on one of the Pioneer food manufacturing and processing industries in Pakistan 'Kolson' on June 24th 2008. We here by submit the report. We carried out preliminary research by interviewing Mr.Miraj Hussain ABM of Kolson's biscuits cookies and cereals products and some research was carried out through questionnaires. This research gave us an over view of Kolson's organizational culture, level of market penetration, its responsibilities, commitments and its position among competitors. We enjoyed working on this report as a team. It gave us an exposure to the market and the organization. Thanking you. Sincerely, Members of Group # 2

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LETTERS OF ACKNOWLEGMENT
FIRST OF ALL WE WOULD LIKE TO ACKNOWLEDGE THE SERVICES AND FACILITATION OF MR.MIRAJ HUSSAIN, BRAND MANAGER KOLSON COOKIES, CEREALS AND BISCUITS AT FED GLOBE INTERNATIONAL. WE HAD INTERVIEWED HIM FORM THE SAKE OF THE PROJECT AND IT WAS REALLY NICE OF HIM TO TAKE OUT TIME FOR US FROM HIS BUSY SCHEDULE. HE BRIEFED US UPON DIFFERENT MARKETING STRATEGIES KOLSON IS PURSUING WITH REGARDS TO ITS PRODUCTS, AND ALSO ABOUT KOLSON'S FUTURE PALNS.

WE ALSO THANK OUR COURSE INSTRUCTOR, MS FARAH SAJID FOR HER GUIDANCE AND INSTRUCTION WHICH ACTUALLY MADE THIS REPORT POSSIBLE. WITHOUT HER HELP, WE WOULD NOT HAVE BEEN ABLE TO COMPLETE THIS ACADEMIC WORK.

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KOLSON HISTORY AND BACKGROUND

Ever since its inception in 1942, as on today, Kolson enjoys the distinction of being one of the Pioneer food manufacturing and processing industries in Pakistan. The name of Kolson is synonymous with dynamic an innovative food products. The Philosophy of the company is based on self-commitments to offer consumers greater choice of exclusive quality products. In doing so, the company has, in true since, evolved its own marketing style to establish a more effective relationship with consumers. Being a food manufacturing the Kolson understands the responsibility to provide consumer high quality products and selection of best ingredients that add to the nutritional value of our product. Kolson brands appeal to an extraordinarily diverse array of consumer. The consumer segment starts from as young as one year old who starts developing a taste for snacks and goes all the way up to older age people who consume pasta and breakfast cereals as part of their healthy diet. In consumer promotions, designed to enhance the Kolson image, they therefore, try to satisfy the growing needs of all our target segments. Kolson is proud to be the pioneer in Pasta production in Pakistan. More the 50 years back nobody could think of Pasta as forming a food habit being an absolutely new food concept for populace of Pakistan. At present company is market leader in Pasta products such as Spaghetti, macaroni, Lasagne, Noodles and Vermicelli.

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Kolson also has a leading edge in manufacturing breakfast cereals that are innovative and extremely popular among the consumers of all ages. As company hierarchy enters to the third generation, it befittingly coincides with yet another stunning product, an innovative range of high-class Biscuits. Jam Hearts, Cream Hearts, Katch and Bravo, being sandwich, crackers and traditional bakery biscuits respectively which are already fetching consumers' recognition and appreciation because of its unique and smacking flavor and texture. The whole range of Kolson products is made by using latest German, Dutch, Swiss and Italian etc latest technology and process to back prime raw materials. The raw materials are procured from the leading available sources in Germany, Denmark, Belgium and Nederland etc. The high quality Pakistani wheat products, procured from select bunch of millers, are pivotal in determining the final outcome of high quality products. As the global economy is taking a different turn in its outlook an demand, Pakistan can not afford to lag. Kolson is prepared to accept the challenge to be always one step ahead of changes in offing. This is our simple pr5omise to our die-hard and prospective consumers in Pakistan.

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ORGANIZATION STRUCTURE
7-Boaes of Directors 8- GMS 4- GAS RSM ASM TSO SO SR DR

MARKETING DEPARTMENT STRUCTURE:

General Head Marketing

Brand Manager Mr.Zeeshan Chips

Brand Manager Mr.Hatim Slanty,Pasta

Brand Manager Mr.Saqibuddin Biscuits,cookies, cereals

ABM

ABM

ABM Miraj Hussain

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MISSION STATEMENT
To provide a one shop to promote socially responsible life style products while growing the global market with the conscious.

COMPANY OBJECTIVES
The fundamental objective of Kolson is maximum growth in the food industry. A recent example of the achievement of such an objective was to extend their brand into a completely different category in late 2004 when they diversified their food line by entering the biscuit market. The long term objective pursued by the company is to be on a constant lookout for new competitors and to make efforts to nip them in the bud, so that in the long run they do not pose as a threat to Kolsons market share.

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PRODUCT LINE AND CATEGORIES

SLANTY TWINKLE Cheese balls CRINKLE PATATO PATATO CHIPS LONDON STICKS CHATA PATA RINGS

- TWITCH - SMART CHIP - FRIEND CHIP - SNACKER

KATCH BRAVO JAM HEARTS (Vanilla) JAM HEARTS (Chocolate) CREAM HEARTS CREAM HEARTS (Chocolate and Vanilla)

CHOCO WHEELZ FROOT WHEELS COCOA BEANS HONEY RICE CRISPIES

MACARONI LASAGNE NOODLES SPAGHETTE

- VERMICELLI OBJECTIVES - VERMICELLI

- VERMICELLI

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Total Organized Biscuits Industry

14000 12000 10000 8000 6000 4000 2000 0

20012002

20022003

20032004

20042005

20052006

20062007

20072008

20082009

20092010

20102011

Assumptions: 1. 2. 3. 4. The major growth in the industry will be brought by organized players. Economical & Political conditions will remain stable. Country will maintain the present & healthy growth rate. Kolson will also increase its efforts for further penetration but the focus will be more on the trade push.

KOLSON-FG
A Fabled success story of cooperation & trust. Kolson-FG Joint operations is a unique example of CUSTOMER-VALUE CHAIN integration which provides for a win-win solution to all the stake holders. Fed globe provides all the promised services & enjoys the position of a strategy partner for Kolson in Pakistan.

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MARKETING SEGMENTAION
Kolson segmented the market according to Demographic, Geographic, Psychographic and Behavioral. DEMOGRAPHIC In demographic marketing segmentation of the Kolson divide market age wise, gender wise, according to family size, family life cycle, income, generation. PLAN: Cookies, Bravo, Kids Mobile, Movements. 12 to 40 years. Male and Female Young, Adults and Teens Cream: Jam Hearts, Cream Hearts. 1 to 28 years Kids and Teens and some times old People Cracker: Katch 18 to 35 years male and female both, young and adults.

GEOGRAPHIC Kolson sell its biscuit nationally and Internationally. PSYCHOGRAPHIC Kolson offer its Biscuit to lower class and to middle class, working class. BEHAVIOURAL Kolson biscuits are in regular consuming product thats why Kolson make it available every where as buyers buy Kolson biscuits easily and it gives good quality in biscuit at affordable price.

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TARGET MARKETING
Kolson target to all age of people.

POSITIONING
Kolson positioned its biscuits as a full of energy, young adults, remetiz, delicious and innovative family and Party biscuits.

BRAND POSITIONING
Bravo when we hear the name of Bravo it indicated the full of energy and daring biscuits. Jam Heart indicates the biscuits for Lovers and Teen agers. Mobile name of biscuits indicates is a kid's biscuit.

BRAND PERSONALITY
Kolson has a strong brand personality that's why it supports the other categories brand.

MARKET SIZE
Kolson biscuits are sold in all over the Pakistan nationally and now a Kolson biscuit enters in International market like USA, Canada.

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MARKET SHARE

50% EBM 25% LU 11% Kolson 9% Bisconi 5% Mayfair

Kolson Biscuit shares 11%

Market Shares of Biscuit Companies

EBM LU Kolson Bisconi May fair

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MARKETING MIX
PRICE: (All Products have Same price) Ticky Pack: PKR 4.00 Half Roll: PKR 12.00 Family Pack: PKR 22.00 PRICING APPROACHES Kolson use competition base prices approaches for set its price strategy. Kolson sets its prices strategies available in the market. PLACE Kolson considers its distribution network to be one of its key strengths because it is highly effective at supplying the various Kolson products at the retail outlets. They have outsourced their marketing and distribution operations to Fed Globe International. Kolson biscuits can be found at nearly all retail outlets throughout Pakistan. They have a distribution network in all the major cities in Pakistan. Kolson is targeted at late teens and the youth. This is also evident from their advertisements and television commercials. Kolson biscuits see itself competing mainly with its closest rival Bakery and the market leader Sooper. It also sees the non branded egg and milk cookies as threats to its market share.

CHANNELS OF DISTRIBUTION General Stores, Wholesale market departmental and super stores, i.e. increased efforts to penetrate the market.

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PROMOTIONAL ACTIVITIES The company is aware and does quarterly analyses about who purchases what products of Kolson. The company evaluates the trends in the markets; where there are heavy sales and where there are no or negligible sales. Once they have analyzed their strong and weak sales areas they decide which promotional tools to apply. The promotional tools that are used by Kolson are BTL Activities Third Party Contracts (Mostly Pegasus) Trade Gatherings Road Shows Club Dinners Conducted in Presence of concerned Sales Officer ATL Activities Advertising Agency is Brand Partnership Media, Billboard Campaign Print Campaign Etc Media advertisements and billboards Kolson markets its products through heavy advertisements. Most of the television advertisements focus on its snacks and biscuits. Many billboards across the city display Kolson products. The advertisements target all age groups and income levels. Trade push When trade push is employed a good display position is sought after at outlets. If there is money to be invested the common rule of eye level is buy level is employed. jo cheez dikhti hai woh bikti hai!

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PRODUCTS

Name:

Katch

Category: Cracker Packaging: Ticky Pack (4per pack) & Half Roll & Family Pack 1 Box: 115gms (4.06 oz) Ingredients:- Wheat Flour, Sugar, Vegetable Fat, and Oil, Invert Syrup malt Extract, Skin Milk Powder, Yeast, Salt Raising Agents, Natural Enzyme, Emulsifying Agents. Nutrition Chart (Per 100gms) Energy Protein 2030KJ 9.5 gm

Fat Total 32.1 gm Carbohydrates: Total Sugar 71.1 10.0

Cholesterol 4.2 mg Dietary Fiber 1.1 gm Sodium 271 mg

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Name:

Bravo

Category: Egg & Milk Biscuits Packaging: Ticky Pack (4per pack) & Half Roll Packaging: 1 Box: 24gms x 24 pkt (0.85 oz x 24)

Ingredients:- Wheat Flour, Sugar, Vegetable Fat, Skim Milk Powder, Fresh Eggs, Cocoa Powder, Salt Emulsifying Agent, Artificial Food Colour & Flavours. Nutrition Chart (Per 100gms) Energy Protein Fat Total 2133KJ 7.5 gm 27.5 gm

Carbohydrates: Total Sugar Cholesterol Sodium 72.9 gm 25.8 gm 17.2 mg 271 mg

Dietary Fiber 0.180 gm

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Name:

Jam Hearts (Vanilla Cream with Jam Topping)

Category: Cream Biscuit Packaging: Ticky Pack (4per pack) & Half Roll & Family Pack 1 Box: 115gms (4.06 oz) Ingredients:- Wheat Flour, Sugar, Vegetable Fat, Invert Syrup, Skim Milk Powder, Salt Maize Starch, Raising Agents, Emulsifying Agent, Artificial Food color and Flavors, Strawberry jam.

Nutrition Chart (Per 100gms) Energy Protein Fat Total 1563KJ 6.3gm 15.6 gm

Carbohydrates: Total Sugar 63.0gm 31.1 gm

Cholesterol

9.1 mg

Dietary Fiber 0.270 gm

Sodium 481 mg

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Name:

Jam Hearts (Chocolate cream with jam Topping)

Category: Cream Biscuit Packaging: Ticky Pack (4per pack) & Half Roll & Family Pack 1 Box: 115gms (4.06 oz) Ingredients:- Wheat Flour, Sugar, Vegetable Fat, Invert Syrup, Skim Milk Powder, Salt Maize Starch, Raising Agents, Emulsifying Agent, Artificial Food color and Flavors, Strawberry jam.

Nutrition Chart (Per 100gms) Energy Protein Fat Total 1563KJ 6.3gm 15.6 gm

Carbohydrates: Total Sugar 63.0gm 31.1 gm

Cholesterol

9.1 mg

Dietary Fiber 0.270 gm Sodium 481 mg

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Name:

Cream Hearts (Sandwich Biscuit with Chocolate & Vanilla)

Category: Cream Biscuit Packaging: Ticky Pack (4per pack) & Half Roll & Family Pack 1 Box: 115gms (4.06 oz) Ingredients:- Wheat Flour, Sugar, Vegetable Fat, Cocoa Powder, Invert Syrup, Glucose Syrup, Honey, Skim Milk Powder, Salt Maize Starch, Raising Agents, Emulsifying Agent, Artificial Food color and Flavors.

Nutrition Chart (Per 100gms) Energy Protein Fat Total 2119KJ 7.0gm 21.5 gm

Carbohydrates: Total Sugar 67.4gm 35.2 gm

Cholesterol

9.2 mg

Dietary Fiber 0.280 gm

Sodium 519 mg

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Name:

Cream Hearts (Double Cream)

Category: Cream Biscuit Packaging: Ticky Pack (4per pack) & Half Roll & Family Pack 1 Box: 115gms (4.06 oz) Ingredients:- Wheat Flour, Sugar, Vegetable Fat, Cocoa Powder, Invert Syrup, Glucose Syrup, Honey, Skim Milk Powder, Salt Maize Starch, Raising Agents, Emulsifying Agent, Artificial Food color and Flavors.

Nutrition Chart (Per 100gms) Energy Protein Fat Total 2119KJ 7.0gm 21.5 gm

Carbohydrates: Total Sugar 67.4gm 35.2 gm

Cholesterol

9.2 mg

Dietary Fiber 0.280 gm Sodium 519 mg

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CRITICAL ANALYSIS
SWOT ANALYSIS STRENGTH The competitive edge identified for Kolson is their product innovation. Their idea of innovation is reflected in their creation of unique products. Bravo is unique in that it has a thin chocolate layer that runs in the middle and the shape is also a bit different from any other egg and milk biscuit in the market. Another strength identified is the supply and distribution channel. They are able to achieve a strong distributor network because their well established products like Slanty and Spaghetti also utilize the very same networks. Kolson also has regional warehouses in the major cities like Karachi, Lahore, Quetta and Peshawar. WEAKNESS One weak area that we can identify is their lack of expertise and experience in the biscuit market. Other key players in the biscuit market such as LU and Peek Freans have years of experience in the field of confectionaries and have created a brand image. Customers do not necessarily think of biscuits when they hear of Kolson. Another reason for this is the success of Slanty which has created a strong association of chips manufacturer with Kolson. OPPORTUNITY According to market growth research conducted by Kolson the biscuit industry is expected to grow b 50% in the next five years. This growth can be attributed to opening u of new markets, especially in the rural areas where branded biscuits are struggling save for Tiger. The way Tiger biscuits achieve this is by including more biscuits per pack then its rivals. Kolson can penetrate into these rural areas and possibly lower down its prices or include more biscuits in the same pack. They would also need to
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adjust their biscuit's taste and price for the rural markets possible by introducing a variant of the same biscuit in a different packaging. Kolson can also take the opportunity of promoting its biscuits as a better and healthy alternative to other snack foods. Their biscuits contain nutritious like milk and egg and so Kolson can promote that as well. THREATS Three main threats have been identified. The first and most pertinent threat is the fast growing and highly competitive local industry. The mail players are Peek Freans, LU, Bisconi, and the unbranded industry. Although the unbranded industry is not so much successful in the metropolitan areas, it has managed to give the branded products a very tough time in the smaller villages. Second area Kolson must be careful about is the emerging threat form International businesses that are establishing snack operations in Pakistan. So far a significant competitor in the egg and milk market has not risen from the Multi National Corporations but it is just a matter of time that they start looking in this lucrative segment which is about grow even more. The last threat that can be identified is related to the overall biscuit industry. It results from the fast growing snack food industry (other then biscuit) which is trying to fight for the customer money. A person, when he will have a choice, may spend the money upon chips or nimco rather then spending on biscuits.

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MARKETING STRATEGY
TARGET MARKETING Every member of a family, i.e. mass marketing POSITIONING Kolson needs to be positioned as a delicious and innovative 'family' biscuit. The concept of family is absent from Bravo advertisements, unlike its other competitors, LU, ABM. PRICE The current pricing strategy of Kolson's biscuits is competition based. It is fair enough, because a higher price may take away its urgent market share and a lower price would make the customers think that it is a cheap product. DISTRIBUTION OUTLET General stores, wholesale markets, departmental and super stores, i.e. increased efforts to penetrate the market. ADVERTISING Developing a new advertising campaign that supports the positioning strategy. Kolson should emphasize on the concept of 'family product' in their TV commercials; Moreover, they should highlight the innovative shape and multi-color elements through their advertising channels. Increase the advertising budget by 12%. Presently, Kolson is spending only 10 to 12% on Bravo. This is a fairly low percentage of expenditure.

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SALES PROMOTIONS Kolson should come up with new variants in the Biscuits brand. The new variants may be new flavor some colors. This may attract the target market and promote the sales. Kolson should also add a "Family Size" packet of its all biscuits to its product line. As the family size packet is cheaper to purchase (in per biscuit terns), customers would be attracted to buy them.

MARKET RESEARCH Conduct through market research to understand the consumer-choices and behaviors. Try to figure out what where Kolson lags, as compare to its competitor, LU, ABM. Kolson should ask the customers about what changes and additions in terms of taste, size, packaging, etc, would the customers like to see in its biscuits.

MARKETING OBJECTIVES
To increase Kolson's market share to 11% of the entire Biscuit industry in the future.

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RECOMMENDATION
1. Kolson has not been so active in terms organizing or sponsoring social events. We think that it should take a step forward by sponsoring events like sports, concerts, and academic events. The reason we chose academic events is Kolson currently positions Bravo as product for teens and youth, which is quite evident from its TV commercials. In order to reinforce positioning, it should sponsor academic events organized by college and university students, who in turn are its target market. 2. Furthermore the Kolson should also actively involve themselves through all the channels where it could connect to families. Since Bravo in broad sense will be targeted to the whole families and Kolson is a family brand with products for every member of the family. 3. Another program we would like to initiate is that Kolson can initiate a marketing campaign in rural areas. We know that the rural area market has a lot of potential and some local unbranded companies are operating very successfully there. None of the branded company has really tapped that market segment, and Kolson can be the first one to do so. This would give then a competitive edge over other players in the market, and also ensure a rise in sales.

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