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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 e.pected to pla& a pivotal role in povert& alleviation and improving livelihoods of the poor in the mil" collection areas.

Vision
/0ur vision is to become a fast e.panding 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 e.pand in and be&ond Pa"istan2 through strategic international alliances$ to eventuall& become global./

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

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 e.panded their business to%ards dair& side. heir business portfolios are as follo%s. Engro Fertili3er Limited Engro E4-5P Ltd Engro5anagement !ervices Ltd EngroPo%erGenLtd. Engro Foods Limited 1ith their affiliates$ Engro 6opa" Engro Pol&mer 7 8hemicals Ltd (Formerl& Engro 9sahi) 969:8E0: (Formerl& Engro -nnovative) Engro Energ& Engro Foods is currentl& having 5 products running in the mar"et 0lper,s arang

0l%ell 0more

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New Product De elo!ment Process

:e% product development process consists of follo%ing steps$ *. 2. #. ;. 5. <. +. =. "dea #eneration "dea Screening $once!t De elo!ment and %esting Mar&eting Strategy De elo!ment Business Analysis Product De elo!ment %est mar&eting $ommerciali'ation

() "dea #eneration :e% product development starts %ith idea generation$ semantic search for ne% ideas. 5a>or sources of idea generation include internal and e.ternal sources. 'sing internal sources$ the compan& can find ne% ideas through formal research and development. -nternal source includes the persons %ithin the organi3ation. Good ne%?product ideas also come from customers. he compan& can anal&3e customer @uestions and complaints to find ne% products that better solve customer problems. *) "dea Screening he purpose of idea generation is to create a large number of ideas. he purpose of the succeeding stages is to reduce that number. he first idea? reducing stage is idea screening.i.e$ screening ne% product ideas in order to spot good ideas and drop poor ones as soon as possible.

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+) $once!t De elo!ment and %esting 9n attractive idea must be developed into a product concept. 9 product concept is a detailed version of the idea stated in meaningful consumer terms. his stage has t%o parts i.e.$ 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 De elo!ment 5ar"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"et2 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 De elo!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.

/) %est Mar&eting -f the product passes concept and product tests$ the ne.t 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 e.perience %ith mar"eting the product before going to the great e.pense 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.

De elo!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 e.ternal sources and collected suggestions and ideas from customers. EFL found more opportunities in dair& as Pa"istan is the # rd largest 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. complete %ithin t%o to three &ears. he& decided to compete other brands li"e :estle 5il"pac"$ Good 5il" and (aleeb %ith better @ualit& and this all process %ould be

$once!t De elo!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 0lper,s. *200 named %ere revie%ed and anal&3ed before 0lper,s %as decided. 9ttribute positioning for 0lper,s$ (aleeb is for tea$ :estle for drin"ing$ no mil" for all of the purposes$ but 0lper,s is

for all purpose. 0lper,s.

hen EFL presented it to target customers for testing the concept of

Mar&eting Strategy De elo!ment

he& developed their ne% product 0lper,s. he& settled the price b& loo"ing at their competitors. Full cream mil"$ use of red color$ 0lper,s means all purpose mil" for the %hole famil&. Price %ould be comparativel& less then others. -ntensive mar"eting %ould be in 5 regions Earachi$ Lahore$ -slamabad$ Pesha%ar and 5ultan. 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 0lpers$ :estle has #FD of mar"et share$ 0lpers has #+D$ (aleeb has *=D and rest of the mar"er share to the remaining products.

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Product De elo!ment
EFL built its first plant in !u""ur and develop 0lper,s concept into a ph&sical product %ith better @ualit& and taste then others and red distinctive pac"ing for all purpose mil" for %hole famil&. he& developed three different pac"s for their mil"$ as per famil& re@uirements. !o that it can be convenient for all consumers.

%est Mar&eting
EFL used standard test mar"et and done blind testing in Earachi. -t %as a great success for EFL. !o after having success in Earachi the& launched 0lper,s on 20th 5arch 200< in 5 regions i.e. Earachi$ Lahore$ -slamabad$ Pesha%ar and 5ultan.

$ommerciali'ation
1ith the launching of 0lper,s$ EFL too" the support of media and advertisement. he& used traditional media li"e radio$ television$ ne%spaper and maga3ine. 0ther media li"e sponsorship$ P) activities and supplemental media li"e trade sho%s and sales promotion such as purchase displa&.

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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. their competitors. heir target is to get ma.imum 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 appro.imatel& )s 20 per liter$ %hile processed mil" is priced at appro.imatel& )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 PL58s have not increased prices in the last 5 &ears. 5oreover$ :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.

he&

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

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 500ml 250ml for large famil& for middle famil& 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 5il"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 0lper,s and its competitors are given b& the table belo%. Prices 24s3 1l!ers -+* (-

Si'e 2ml3 (666 -66 *-6

Nestle Mil&!ac& -+* (-

Halee5 -+* (-

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 the consumers 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 5ar"eting 5anager of the EFL$ G-n order to succeed$ &ou should 9L19H! capitali3e on &our ! )E:G( ! and :E6E) on &our 1E9E:E!!IJ 9ccording to the !10 anal&sis the& performed$ EFL team came to "no% that the& have a ver& good P) %ith their farmers. he& did e.actl& as their 5ar"eting 5anager 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& 0lper,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 Earachi$ Lahore$ -slamabad$ Pesha%ar and 5ultan. 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 5arch 20$ 200<$ 0lper,s mil" is EFL,s standardi3ed and homogeni3ed pure '( ('ltra heat treated) mil" %ih #.5 D fat and =.F D solid non?fats. -t is EFL,s premier brand$ and the choice of @ualit&?conscious consumers %ho onl& go for the best. -t is available in eas&?to?open$ <?la&ered etra Pa" Bric" 9septic red pac"aging and comes %ith a # month shelf life.

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EFL onl&$ has the third?generation '( mil" plant in the countr&. EFL plant is the onl& plant in Pa"istan that uses Bactofuge technolog& to virtuall& eliminate bacteria and ensure premium @ualit& and h&giene. 5oreover$ it is also setting up another mil" processing plant in 8entral Pun>ab (!ahi%al) %ith an investment of )s. 2 billion ('! L ## million). S7i!!ing 8nits * Litre (*000 ml ) K *2 pac"s per carton M Litre (500 ml) K *2 pac"s per shrin"?%rapped tra& N Litre (250 ml) K 2+ pac"s per shrin"?%rapped tra&

EFL targeted 9 7 B class outlets.

Distri5ution $7annels
heir distribution channel is conventional distribution channel i.e.$ From plant it goes to the :ational 1arehouse in !ahi%al. From %here it is transported to the distributors all over Pa"istan. hen from distributor to %holesaler and retailers. 9nd then it reaches the end users %hich are the customers %ho use this product. here are currentl& 5; distributors of EFL %or"ing all over Pa"istan. *= distributors are %or"ing in )a%alpindiO-slamabad region. From %hich # are in )a%alpindi and # in -slamabad. )emaining *2 are %or"ing in the outside areas of the cit& li"e villages and to%ns. Li"e * is in 5urree$ * in 5andra$ * in Gu>ar Ehan$ * in 8ha"%al etc. EFL sales force including !ales man$ 0rder boo"er and 5erchandisers informs the compan& about the position of competitors in the mar"et$ li"e activities and different promotional campaigns of :estle and (aleeb running in the mar"et.

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he& also tells the EFL about the li"ings and disli"ing of the customers. the minds of consumer.

he& spread

information about the compan& to the customers so that it can create an image of EFL in

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

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

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Ad ertisement
0n 20th 5arch$ 200< 0lper,s has been launched into the mar"et. 0lper,s launch %as$ perhaps one of the most aggressive as far as processed li@uid mil" (PL5) is concerned$ %ith 68s$ print ads$ radio commercials$ billboards and plent& of B L (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 0lper,s launch. 0ne 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 $o!y: 9it7 1l!ers Mil& Limited Edition Pac& we ;oin you in t7e cele5rations of 4amadan) En;oy t7e full cream goodness of Premium <uality 1l!er=s Mil& e ery Se7r and "ftaar) So treat yourself wit7 1l!er=s Mil& all t7roug7out 4amadan and get ready to re eal in t7e colorful festi ities of Eid) %ag Line 2$or!orate Slogan3: Su5a7 Ba&7air >indagi Agency: ?9% Asiatic

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5edia mi. for 0lper,s mil" includes 6$ print$ outdoor$ radio 7 B L activities. 0lper,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 0lper,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". 0lper,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 brand as 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 0lper,s isK Subah Bakhair Zindagi$ but recentl& the compan& changed the '!P toK Jo dil khol kay jeetay hain unheen kay liyay hai Olpers . Both the tag lines have a ver& positive impact on 0lper,s image because of the emotions involved in both the lines. Promotion For the promotion of 0lper,s EFL selected a ma>or tool %hich is advertising. 9t the launch of 0lper,s the main ob>ective of EFL %as that the& %ant to develop the better image if 0lper,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 ma.imum mar"et share.

EFL passed *0 million )s for the advertisement and estimated that EFL can increase 0lper,s sale b& 50 D ? +0 D. EFL anal&3ed that (aleeb and 5il"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 0lper,s in different cities. :o% a da&s their campaign named G6eni3aJ is currentl& running in the mar"et. -ts ob>ective is to provide information the consumers about the all purpose use of the 0lper,s mil".

Media Selection

20 EFL decided that the& %ill use electronic as %ell as print media support for advertisement. 9fter launching 0lper,s at 20th 5arch$ 200<$ EFL started a ver& effective and ver& e.pensive advertisement through 6 commercials$ ne%spapers$ maga3ines and radio$ so that the& could conve& their message to ever& target customer and build brand preference. For 0lper,s the& decided their media timing to be from + p.m. to F p.m.$ the time at %hich most of the people %atch tv. 9fter starting their advertisement$ EFL came to "n% that man& people are motivated from their advertisements and through that successive strateg& their sales start gro%ing rapidl&$ %hich is still maintained b& the 0lper,s team. 9n the& are doing there advertisements and promotional campigns.

0lper,s tries to get tremendous e.posure %here the customers are most li"el& to loo" for mil"2 shelf position$ billboards$ 68,s etc. 0lper,s advertising ob>ective 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 0lper,s. he message strateg& of EFL %as that 0lper,s is all purpose mil" and is for the %hole famil&. he& used their slogan Gjo 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.

$onclusions
From this pro>ect it is concluded that Engro Foods after having success in the chemical industr& decided to e.pand their business. he& too" help of their team and developed a ne% product$ all purpose mil"$ 0lper,s. he& undergo all the steps of ne% product development to develop their product and then develop strategies for pricing$ placement and promotion. competitor in the business of diar&. his %as a great success for 0lper,s team that their mar"et share started gro%ing rapidl& and 0lper,s is a ver& strong

4ecommendations

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9s EFL is on the %a& of success and glor&. 0ur 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 5anager$ Engro Foods Limited$ )a%alpindi 5uhammad :asir$ )a%alpindi Babar (ussain$ erritor& !ales 5anager$ Engro Foods Limited$ )a%alpindi. erritor& !ales 5anager$ Engro Foods Limited$

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