1
Then comes the most important portion of the company’s
operations, which is the strategic management of marketing mix I-e 4Ps.
A comprehensive detail is provided about the company’s strategies
devised to maintain and develop the product line (juices), strategies to
set and quote the prices, their distribution patterns and logistics. The
image Haleeb wants to develop in the minds of their customer and the
extent to which they are succeeded through their promotional
campaigns is explained in this report.
Haleeb Foods has built yet another plant in Rahim Yar Khan whose
purpose is to provide Haleeb’s quality products to maximum number of
consumers. And a plan to extend their product line in case of juices and
has an intention to introduce new flavors of pure juices, nectars and
juice drinks.
2
Introduction of HFL:
HFL is now one of the fastest growing packaged food companies in
Pakistan with an annual turnover of Rs. 9.2 Billion (F2006). It is a
private limited company. It started commercial production in July
1987. Due to consistently superior performance, it has achieved
undisputed leadership in the liquid packaged milk category with a
market share of over 52%. HFL has a very strong brand portfolio
consisting of dairy as well as non-dairy products.
Haleeb Foods has segmented its product portfolio in 3 leading brands
including Haleeb, Candia and Tropico. Haleeb is the flagship brand of
the company. Haleeb UHT Milk is available in 5 Sku’s of Tetrapak
packaging. Due to its strong positioning of the thickest milk for best
tea, it has the highest top of mind awareness and penetration in the
dairy industry of Pakistan. In order to increase consumer and trade
penetration of the brand, it is also available in Tetra Fino Packaging
under the brand extension of Haleeb Dairy Queen.
Haleeb has also progressively diversified from UHT Milk to other
product categories as well. These product line extensions include
Haleeb Butter, Haleeb Yogurt, Haleeb Cream, Haleeb Labban
(Drinking Yogurt), Haleeb Asli Desi ghee (Butter Oil), Haleeb Funday
Juice Drink, Haleeb Skimz (skimmed milk), Haleeb N'Rish Full Cream
Milk Powder & Haleeb Good day Pure Juices. Haleeb Good day is the
only range of 100% pure juices in the country with a variety of 6 pure
juice flavors.
Haleeb Foods, having a Franchise agreement with Cadillac France,
launched Candia Double Sterilized Milk in bottle format in April
1999. Candia is also available in the Candia Classic variant which is
positioned for Tea. Another recent initiative is Candia Candy Up,
which is flavored milk for children.
HFL has one of the largest nation-wide distribution networks
delivering high quality products, even in the remote areas of
Pakistan. With a network of +1100 distributors the company ensures
that the product range is available in all the urban and semi urban
areas of Pakistan. Furthermore, concerted efforts are being made to
develop the rural market as well.
3
HFL has an efficient and resourceful Export department, which has
successfully tapped opportunities in foreign markets including
Korea, Hong Kong, USA, UK, China, Afghanistan, Bangladesh and
the Middle East.
In order to provide best quality products to its consumers, HFL has a
well-developed supply chain infrastructure. It has heavily invested in
a vast network of company operated milk collection centers across
the country. HFL has a strict and stringent quality policy regarding
intake of raw milk. It is the only company that conducts 21 rigorous
quality tests to ensure that only fresh milk of the highest quality is
accepted at the plant premises. These internationally recognized tests
are used to check for: a) adulteration, b) microbiological
contamination and c) adequacy of nutritional contents. Further,
Haleeb Foods is the only food company in Pakistan that has the
following international certifications of quality and prestige:
•HACCP
(in process controls for safer products)
•ISO
9001 – 2000 (better quality for greater customer satisfaction)
•ISO 14001 (environment-friendly operations)
HFL believes in using cutting edge processing and packaging
technologies to meet consumer expectations of hygienic and high
quality food products. It has more than 30 Tetra machines for its
UHT milk brands and 5 UHT units with a capacity of producing more
than 1 Million Liters of Milk everyday. Keeping in view the volume
potential and increasing growth trend of the market, the company
has recently inaugurated a second independent UHT plant at Rahim
Yar Khan.
Haleeb Foods has a highly professional management team with a
progressive operating style. The management team comprises of
highly seasoned professionals with diverse global experience of
managing and developing brands. It can lay claim to be one of the
very few Pakistani organizations, which are truly following the model
adopted by globally successfully corporations, with clearly defined
roles for shareholders and the management team.
The company takes pride in being a model national organization
delivering international quality products and higher value for money
to its consumers. The management team at HFL strongly believes
that Pakistan offers enormous potential for food business due to a
4
large consumer base, high acceptance of packaged food, and a
growing urban middle class consumer segment.
History:
Haleeb Foods Ltd. was incorporated on July 1st, 1984 with a
capital of Rs. 46 Million under the name of Chaudhry Dairies Limited which was renamed as
CDL Foods Limited and now it is known to be as Haleeb Foods Limited. At that time it had the
capacity of producing 80,000 / liters of milk per day having total area of 32 acres. Initially 150
people were employed at the plant. The production process started with UHT liquid milk. The
liquid milk was the first product launched in the market, it started its operation in 1985 at that
time 20 other dairy plants were also coming in, and all those including MILKPAK were using
obsolete technology that was used in EUROPE. Haleeb Plant was the only plant based on the
latest technology and the basic idea behind that were particularly dairy foods products. Haleeb
is one brand that is toady known everywhere.
From November 1989 till December 1991 Haleeb had a joint venture with fries land Frico
Domo of Netherlands. This joint was amicably dissolved on account of FFD's change in
5
management in their global strategy. Today as an ISO 9002 certified company, Haleeb is the
dominant market leader of UHT milk in Pakistan by capturing 52 % share.
Franchise agreement with Canada, a market leader in the liquid milk market in France, was
assigned in December 1998. Under this arrangement, the company launched Candia range
of value added liquid milk product and also have assess to latest production, technical
and marketing know how. Initially company launched different products but
some of them could not become successful. As the company's core concern is
quality eventually company abandoned products that were not according to the
market needs. In 2002 the company contributed 54% to the country's packed
milk market.
Haleeb Foods was established in 1986 as a private limited company and its first
product was Haleeb milk. Since then, it has continued to provide quality
products to its consumers with product and packaging innovations. Other
products and their dates of launch are as follows
6
Year of Launch of the Products:
7
Information about Haleeb Foods
Board of Directors:
Chairman:
Mr. Ilyas Chaudhry
Managing Director:
Mr. Israr Ahmed
8
Auditors:
Hameed Chaudhry and company
(Chaudhry Accountants)
Legal Advisor:
Hassan and Hassan Advocates
Marketing Research:
Aftab Associates
Advertising Agency:
Paragon Evernew Concepts
9
Work Force:
It has a team of 3000 exceptional individuals to support its
operations, out of which
Market Share:
Area:
The total premises area of Haleeb foods Rahim Yar Khan Factory is
about 72 acres. Plant & offices are situated at 20 acres. The remaining
52 acres are vacant and for expentation purpose.
Distribution Channels:
10
their distribution channels and then products delivered to the
customers.
11
Competitors:
Haleeb foods competitors are:
Nestle
Good Milk
Olpers
Shehzan
Head Office:
135 ferozpur road Lahore 5460 Pakistan
Phone +92 42 111 135 135
Regional Offices:
Lahore,
Rawalpindi,
Karachi,
Peshawar,
Quetta,
Rahim Yar Khan, Dubai.
Location of Factory:
12
There are two plants of Haleeb foods
International Certification:
Haleeb Foods is the only food company in Pakistan that has the
following international certifications of quality and prestige:
Haleeb’s Policy:
13
➢ Provide all the necessary resources for the continual improvement
in quality, safety of our products, processes and environment.
14
GM
AM
Head
HRD
HRFinance
ER
Assistant
Manager
of
Manager
Personnal
Dept.
sheikh
(MainManager
Rahim
(Omer
Bhai
umerYar
Pheru
Hassan
ShahidSaleem
Khan
Mohsin)
(Alam
(Ali
Baber)
Zaman
Janjua)
Head Wahab)Khan)
Office
(Tanzeela
hj Rafique)
(Asif Habib)
15
A Haleeb food is a customer oriented organization so it is
manufacturing the products for every kind of consumers. Haleeb foods
have a very rich brand portfolio with national and international brands.
In order to provide their customers the wide range of products Haleeb
Foods Ltd. is using every kind of management strategies like it was
having a merger and franchise with two foreign companies.
One of the core competencies of Haleeb foods is their variety of
products that they are using branding strategies in order to compete
with rivals of dairy products, multi branding, brand extension and line
extension. The wide range of products of Haleeb foods is the major
contribution towards the success of the company.
16
Haleeb UHT Milk
17
Dairy Queen UHT milk
18
Haleeb Gold milk
Skimz Milk
19
Manufacturing process at Haleeb Foods
20
21
22
23
24
25
PROPOSED VISION STATEMENT
26
External environment – remote
environment
Economic forces
Scenario
27
Business Saving Rate:
Rate of risk:
28
Overall HALEEB FOODS business cycle:
29
Implications
30
Porter’s five Model
There are following barriers of entry for new entrant foe juices in
market.
31
• Supplier product has high switching cost for Haleeb
Food Company.
• Supplier of Haleeb juices plump has no substitude
supplier.
32
Pest Analysis:
POLITICAL CONDITIONS: The political conditions are not very stable in the
country, but this does not directly influence the trends and spending patterns of the customers.
There are no restrictions or barriers on the growth of this industry. So the political conditions
are favorable fir this market because food and dairy chain products are consumer goods and
they have to purchase it in any condition.
ECONOMICAL CONDITIONS:
The economical conditions are not very favorable and the economy is facing problems, but
it is nit directly influencing buying power of consumers. If the country is out of its current
problems, it will further boost up growth of this industry, as people will feel more secure
economically and it will further increase the attractiveness of the market.
SOCIAL CONDITIONS:
The social patterns are changing in the country, as the world is becoming a global village, and
mutually share and accept patterns. People are becoming more attractive towards the branded
products. It is becoming fashion and young generations as well as the children are getting more
attracted towards this industry. People are moving towards branded food / dairy products due to
hygienic reason.
TECHNOLOGICAL CONDITIONS:
High technology is the basic requirement of dairy and food industry. The companies that
are using latest technology have some cost benefits over the companies, which are not
using high technology. The key to survival for companies in this industry is using high
technology for quality and cost purposes.
SWOT Analysis
33
Strengths:
• Haleeb Food's products enjoy strong brand image and market pull.
• Sales force is the major resource strength in terms of physical resources of the
company.
• Marketing strategies established by the company are innovative and lure customers.
• Financial, marketing and sales strategies are formulated by gauging the customer
demands.
H
ighly sophisticated plant and equipment.
•
• Qualified work force.
34
• First and the only dairy company in Pakistan to get ISO 9002 certification.
Weakness:
• No credit sales.
• They cannot launch many of its expensive international brands due to the lower
income groups.
• Feasibility of new products needs to be analyzed, e.g. Candia Drinking Yogurt was
launched some years back but it failed because no customer demand exist it.
• The packing line installed for N'Rish has a higher capacity than the actual demand
of the product, resulting in higher overhead costs for the product.
• Inadequate marketing.
35
Opportunities:
• There are substantial growth opportunities considering the average yield of Pakistani
animals at only 1,100 liters/annum as compared to 6,000 liters/annum for animals in
Europe and USA. There are nearly 20 million milk producing animals in the country,
mostly in Punjab (80%).
•The overall milk market in Pakistan is 20 billion liters, out of which processed milk
•
contributes only 3 million liters. Haleeb Foods along with other processed milk
business contribute only 2% to this large market.
• Haleeb Foods' has expanded its product range by launching milk in Tetra Fino
Packaging.
• CDL has been changed to HFL, so this change in name can help them to attract foreign
customers.
• HFL can go for related diversifications by producing pure juices and flavored yogurt.
• HFL can go for joint venture with other companies to attract the market share.
• Entering in to the market of baby cereals, which will help them in increasing their
revenue.
36
• Launching cheese would also beneficial for them to create the brand awareness.
Threats:
• The present economic crisis in the world, led to the withdrawal of foreign
management from the company and the investment has come to a halt.
37
Summary of Opportunities:
Significance of
opportunity High Low
38
• Untapped
market
High o Concentric
diversification
Probabili
ty Of
Occurre • Backward
integration o To become
nce
multinational
Untapped market and Demand of juices are the high opportunity for Haleeb
and probability of occurrence is also very high so Haleeb juices sales can increases if
it target the all market and demand is increase in market day by day and Haleeb
39
also increase the demand and awareness of juices in market by best
advertisement.
40
Backward integration is the high opportunity foe Haleeb but probability of
occurrence is low because it very difficult foe Haleeb to make its juices plump itself
because Haleeb import the high quality of plump from different countries which it
can’t prepare due to lack of technology.
Summary of threats:
Significance of threat
High Low
• Strong market
High Competition
• • Low Switching
Cost
Probabili
ty Of
Occurre • Imported Tin Custom duties on
juices o
nce
import of plump
Haleeb face strong competition in market of juices, for Good day nestle juices are
big threat and for other all juices like funday and tropico shahzan, Maza and
40
country juices are big threat. Nestle is the big and strong competitor because Nestle
is an international company and people mostly know about international company
due to good quality.
There is not any huge difference in prices of different juices of the company so
customer can any time select juice of different company which is threat for Haleeb
Food Company.
Imported tin juices are great threat for Haleeb juices especially for Good day
because Haleeb offer good day in market with high quality and tin juices also focus
on quality so there are competitor for each other.
Haleeb import plump of all juices from different countries Germany and France,
Haleeb paid high custom duties on plump, so increase in custom duty can increase
the cost of juices due to which prices of all juices increase which is not good for the
company.
40
Situation analysis – Internal capabilities
REVIEW:
IMPLICATIONS
43
5
Management
Production
capability
REVIEW
44
IMPLICATIONS
45
example a rating of 5–3 represents an extremely significant opportunity
or threat that has a reasonable likelihood of occurrence.
Haleeb Foods
Weight Rating Weighted
Company
Internal Factors Score
STRENGTHS
46
• Product positioning 0.05 2 0.1
• Strong distribution channel 0.10 4 0.4
• High quality products 0.10 3 0.3
• Strong management team 0.05 3 0.15
WEAKNESS
0.05 3 0.15
• Product awareness in
• Not good packaging 0.10 2 0.2
• Higher prices in pure juices 0.05 3 0.15
• Low promotion activities 0.10 4 0.4
• Less display centers 0.05 3 0.15
• Late recovery of claims 0.05 2 0.1
47
Haleeb Foods Company Weighted
Weight Rating
External Factors Score
OPPORTUNITIES
• Untapped market 0.20 4 0.8
• Diversification in products 0.10 3 0.3
• Backward integration 0.15 3 0.45
• International markets 0.05 2 0.1
THREATS 0.10 3 0.3
• Strong competitor Nestle in 0.15 4 0.6
• Products advancement 0.05 3 0.15
• Fluctuation in tax rates 0.05 2 0.1
• Imported juices 0.05 2 0.1
• Custom duties on plump 0.10 2 0.2
TOTAL 1.00 3.1
48
CPM (Competitive profile matrix)
In the CPM the industry average take as 3.50, so the Nestle performing is
the best as compared to their competitors in juices.
Haleeb lunched its juices two years ago but their performance is good
and it is in second number in field of juices due to their pure and nectar
juices with high quality and reasonable prices.
Shahzan only deal in nectar juices and target the lower income group of
people and it all sale is due to customer loyalty.
49
S O W T M A T R IX O F H A L E E B F O
47
STRENTHS(S) WEAKNESS(W)
SO strategies. WO strategies.
• Extensive
marketing
OPPERTUNITIES(O) campaign.
ST strategies. WT strategies.
48
Nestle in juices products
• New product advancement by different
competitors.
48
Quantitative Strategic
Planning Matrix
(QSPM)
mind 0.10 - - - -
• Higher prices in pure 0.05 2 0.10 2 0.10
• Low promotion 0.10 4 0.40 4 0.40
• Less display centers 0.05 3 0.15 2 0.10
• Late recovery of 0.05 - - - -
claims
OPPORTUNITIES
0.20 2 0.40 4 0.80
• Untapped market
• Diversification in 0.10 - - - -
• Backward integration 0.15 3 0.45 4 0.60
• International markets 0.05 1 0.05 4 0.20
THREATS
0.10 3 0.30 3 0.30
• High market
• Strong competitor 0.15 4 0.60 4 0.60
Nestle in
• Products 0.05 3 0.15 4 0.20
• Fluctuation in tax 0.05 - - - -
• Imported juices 0.05 4 0.20 3 0.15
• Custom duties on 0.10 - - - -
plump
49
Total 5 5.5
49
According to this result Haleeb Food Company goes for Market
development in different remote areas of Pakistan, because many markets
in Pakistan are untapped if Haleeb target all these market it can increase
its sales and can gain a lot of profits.
55
56
57
58
59
60
61
62
FINANCIAL HIGHLIGHTS (RS,000)
2007 2008
Trading Results
Sales-net 7,086,175 5,941,780
Gross Profit 1,090,860 870,368
Operating Profit 544,711 417,773
Profit Before Tax 486,114 380,673
Profit After Tax 345,697 232,888
Balance Sheet
63
FINANCIAL ANALYSIS
200 200
Sales Growth % 7
19.26 26.
8
57
Gross Profit Margin % 15.39 14.6
5
Operating Profit Ratio % 7.69 7.0
3
Profit Before Tax % 6.86 6.41
Profit After Tax % 4.88 3.9
2
Pretax Profit Growth % 27.70 23.
00
Net Profit Growth % 48.44 21.3
5
*Current Ratio 1.07 0.9
0
Fixed Assets Tunover Times 6.61 6.41
32.6 30.
Return On Equity %
1 82
Return On Total Assets % 15.7 14.
3 03
64
S e g m e n t F in a n c ia l a n d M a r k e t
Attractiveness
Estimated
Variable costs 2 5 8 6
Contribution margin 3 10 7
Market share3 18 22 11
65
Segmentposition:
66
SALES FORECASTING
= 162419946
Total population of Pakistan
Target people having age 5-above
People having age above 5 = 90 % of 162419946
= 146177951.4
People who like other juices = 75 % of 162419946
= 109633463.6
People who willing to drink
= 36544489
Haleeb juices
Price range = 10 + 25 + 65
Average price = Rs.33
Avg Quantity =2
Sales = 33 * 2 * 36544489
= Rs.2411936274
Rs
Sales = 2411936274
Cost of goods sold = 2098360250
Gross profit = 313576024
Administration Expenses = (34691250)
Distribution cost = (81477000)
Operating profit = 197407774
Other income = 2591400
Profit before interest
64
and taxes = 199999174
Tax = 49145950
Net profit = 1508532
24
From all the above data we find out that there is a lot
of demand for Haleeb juices but they are spending
low as per requirement . As far as promotional
activities are concerned they have introduced many
product as concentric and conglomerate
diversification but when we talk about Haleeb to a
common person he knows that they are offereing
just milk at market place , he does not know that
they have introduced other products like juices ,
ghee, rita , powder milk etc.
64
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69
A. ACTIVITIES TO BE IMPLEMENTED
Page
70
•
1. Organizational Design
Organizational design should consist of multifunctional teams,
including at least 1 member of each department to solve the problem
or to achieve the targets.
2. Incentives
Various rewards may help achieve successful implementation.
For Example in case of Haleeb juices, bonuses or commission should
be given to members of sales force/personal selling teams who sales
more units of juice packets.
3. Communication
Rapid and accurate movement of information should be
confirmed .To do so efficient and effective feed back systems should
be introduced. For example in case of Haleeb the smooth flow of
information should be confirmed from a single member of sales
force / distributors up to the brand manager and vice versa.
Proper time period should be given for the start and end of the task
and each personnel related to that specific job should be given
complete information about the geographic area of his/her sales and
the volume to be sold in case o personal selling and sale promotion.(the
balanced score board technique may be adopted)
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71
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72
They get comprehensive information from all the departments
carefully and its analysis is conducted with great care . The results are
analyzed with great emphasis on the company’s behalf. If there
appears any deficit then revise their strategies implement them and
then get the results and if there are no loopholes found they continue
to implement that strategy for the specified period of time. This
evaluation conduct twice a year.
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73
Strategic Marketing Evaluatio and
Control
Select performance
Obtain and
analyze information
As s es s p er fo r m and
take necessary a c t i o n
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75
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76
CURRENT COMPETITIVE POSITION
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77
○ Bata should gain the sustainable competitive advantage.
Current market
share:
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78
ESTIMATED POTENTIAL REVENUE FROM EXISTING
PRODUCTS IN NEW MARKETS (MARKET DEVELOPMENT)*
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79
Conclusion
The HFL Company has a very rich history and spread over the world, the
study in this report specially the particular SPACE matrix tells us that
HLF Company should pursue an aggressive strategy. HLF Company has a
strong competitive position in the market with rapid growth. It needs to
use its internal strengths to develop a market penetration and market
development strategy. This includes focus on Water and Juices products,
and catering to health consciousness of people through introduction of
different coke flavor and maintaining basic coke flavor. Further company
should integrate with other companies, acquisition of potential competitor
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80
businesses, innovation in branding and aggressive marketing strategy can
bring long term profitability.
As a whole HFL is a good organization to work in but there are certain departments that need
improvements. It is surviving in the FMCG’s sector with some strengths and weaknesses. I am of the
view that if the management of HFL wants to show the same results in the future that it should have
to take some decisions before time, because in the 21st century only those organizations can survive
who are utilizing all their resources efficiently and effectively.
Recommendations:
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81
Haleeb Foods Limited should also allocate a healthy budget for the advertising of
its products.
•HR Department of HFL should introduce HRIS to increase the efficiency of the
company.
•The co-operation among the different departments of HFL should also improve it
will lessen the bureaucratic cost and increase the efficiency of the company.
The activities like customer satisfaction day should be performed on regular basis
so the company should know about the feedback of the customers regarding the
products and image of the company.
The shopkeeper complains that HFL don’t provide replacement to the expired
products so they should provide proper replacements to the shopkeepers to enhance
the image of the company.
Haleeb Foods Limited should improve its distribution system specially the
retailers are not happy with distribution of Haleeb Milk.
They should use latest technology for quality maintenance because even now they
are using manual based inspection.
They should try to maintain high quality which they are already producing.
They should use Automated Storage and Retrieval System to minimize the storage
cost.
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