BUSINESS STRATEGY

TERM REPORT

COMPANY:
ENGRO FOODS

SUBMITTED BY:
ZAINAB DADA
1418141
SUBMITTED TO:
SIR OMAR ABEDIN

SZABIST KARACHI CAMPUS

SRING 2018
Introduction:
Engro Corporation is a Pakistani public multinational corporation based in Karachi with
subsidiaries involved in production of fertilizers, foods, chemicals, energy and petrochemicals.
Its major subsidiaries include Engro Fertilizers - which is one of the largest fertilizer
manufacturers of the world, Engro Foods which manufactures, processes and markets dairy
products, frozen desserts, faizan steels and fruit drinks including the ice cream brand of
OMORÉ. Engro Foods is among the biggest and fastest growing companies in Pakistan with a
vision to cater to local needs with products conforming to global standards. Highly passionate
about providing millions of people across the length and breadth of Pakistan and beyond with the
ultimate brand experience, our product portfolio comprises some of the country's biggest and
best selling brands including Olper's, Olper's Lite, Omore, Dairy Omung, Olper's Lassi and
Tarang.
But whether it is our thick, creamy all-purpose milk, scrumptious ice-cream high on nutrition
content or refreshing range of beverages, our approach remains largely the same as we strive to
keep product innovation at the forefront of our guiding philosophy and consumer satisfaction at
the heart of our operational strategy.
About Friesland:
With roots stretching as far back as 1871, Friesland Campina has a rich storied history. It is the
sixth largest milk producer globally and with over 11B Euros in revenues it is one of the largest
dairy companies in the world. We are based in the Netherlands and have offices in 32 countries
and employ over 22,000 people. Our products find their way to more than 100 countries. Most
wonderfully the very people we serve, own us; our owners are 19,000 farmers in the
Netherlands, Germany and Belgium.
Vision
Aims at transforming the company within the next five years into first a national food industry
giant, then into a regional force and finally into a global player.
Mission
Build Branded food business to improve quality of life by offering tasty, affordable and highly
nutritional products to our consumers while maximizing stake holders' value
Objective and goals
Engro foods main objectives are to supply everyone their favorite olpers Milk and to satisfy the
consumer needs and wants. Engro foods second main objectives are to provide profit to the
shareholders and increase the market share.
Our Values:
At Engro, we support our leadership culture through unique systems and policies which ensure
open communication, foster an environment of employee and partner privacy, and guarantee the
well-being and safety of our employees. Our core values form the basis of everything we do at
Engro; from formal decision making to how we conduct our business to spot awards and
recognition. At Engro we never forget what we stand for.
Following are the core values:
Ethics and integrity:
We do care how results are achieved and will demonstrate honest and ethical behavior in all our
activities. Choosing the course of highest integrity is our intent and we will establish and
maintain the highest professional and personal standards. A well-founded reputation for
scrupulous dealing is itself a priceless asset.
Health, safety and environment:
We will manage and utilize resources and operations in such a way that the safety and health of
our people, neighbors, customers, and visitors is ensured. We believe our safety, health and
environmental responsibilities extend beyond protection and enhancement of our own facilities.
Innovation and risk-taking:
Success requires us to continually strive to produce breakthrough ideas that result in improved
solutions and services. We encourage challenges to the status quo and seek organizational
environments in which ideas are generated, nurtured and developed. Engro appreciates
employees for well thought out risks taken in all realms of business, and for the results achieved
due to them, acknowledging the fact that not all risks will result in success.
Our people:
We strongly believe in the dignity and value of our people. We must consistently treat each other
with respect and strive to create an organizational environment in which individuals are fairly
treated, encouraged and empowered to contribute, grow and develop themselves and help to
develop each other. We do not tolerate any form of harassment or discrimination.
Community and society
We believe that a successful business creates much bigger economic impact and value in the
community, which dwarfs any philanthropic contribution. Hence, at Engro, sustainable business
development is to be anchored in commitment to engage with key stakeholders in the community
and society.
Consumer centric:
Consumers lie at the core of our business. We strive to understand and anticipate their needs to
develop products that satisfy their diverse requirements. Every individual works towards this
goal and the purpose of our business is to create and keep consumers and continue to delight
them.
Brands under Engro Foods:
Engro Foods Limited is subsidiary of Engro Chemical Pakistan Ltd. which is one of the most
reputed enterprises in Pakistan with more than 40 years of diversified business operations in the
areas of fertilizer and chemicals. Engro Foods started its business operations in March 2006 and
with the successful launch of Olpers Milk, Tarang, Olwell, and Olpers cream, it has established
itself as a major player in the foods business. Engro Foods has already set up two processing plants
at Sukkur and Sahiwal. With the ever expanding milk collection network and processing facilities,
the Supply Chain has geared the company for the growing sales of our products

Engro believes that the recent successes will take the company to its goal: To be one of the biggest
players in the food business. Our aim is to dominate the food business, and to achieve this we will
settle for nothing less than the cream

Marketing Mix of Engro Foods:

Place in the Marketing mix of Engro Foods
Engro Foods is actively involved in the distribution of all its food products. It follows both the
direct and indirect channel of distribution. Under indirect channel Engro food products are
available at almost all the large and small-scale outlets and stores. Even high profile marts and
showrooms that have food item counters display the products of this company. This has become
possible because of the transports owned by private firms. The usual channel under this scheme
includes distributer, wholesaler, retailer and then the consumers.
The direct channel has become possible because the company is selling their products to the
consumers directly through their own personnel on cycles, trucks or tricycles. The distribution
network is an extensive one so that prompt deliveries are possible. Engro Foods has set up its
own dairy farms as well as plants for milk processing in Sahiwal and Sukkar. It has appointed
workforces for milk procurements and created departments that are vigilant in its efforts to
ascertain the freshness of the products. The company covers at least twelve regions and has
nearly three hundred and fifty distributers working under it.
Under its international expansion plans, the company signed an agreement to buy the American
food company Al-Safa- Halal. Today the company has become an international company with a
global market
Price in the Marketing mix of Engro Foods
Engro Foods has decided to follow the strategy of competitive pricing for its products. In order
to do so it has kept a careful watch on the market economy as well as the pricing policies of all
its competitors. It receives regular feedbacks that help it in determining and fixing the prices of
its own products. The market demand is another deterrent in determining the prices and Engro
keeps the lowest possible prices without hampering the quality of the product.
The company has decided to keep the prices flexible on a minimum and reasonable scale, so that
each and every section of the community can reach towards these products. Large volume of
sales yield larger profits for the organization. Keeping all its options open the prices tend to
fluctuate to meet the demands of the consumers as well as other economic factors. In order to
maintain its commitment towards providing realistic food prices the company has taken
admirable and active steps so that cutting of excessive costs can be made possible.
In some cases, the company has also used a premium pricing policy where the prices are a bit
more than the prices of local available brands but are quite reasonable when compared to the
international brands. These are for brand conscious customers who tend to purchase products that
provide competition to foreign markets.
Promotion in the Marketing mix of Engro Foods
The marketing strategy of Engro foods is consumer centric and this has made them a huge
success in the food industry. Under its promotional strategy, it has given special attention to its
packaging and marketing. The attractive and high quality packaging is also colorful to make it
distinctive and eye catching. Tetra packs are used for protecting the flavor and freshness of dairy
products and that to in distinct colors like purple, orange, green and yellow. An Engro food
product is easily recognized at a glance. Engro foods have realized the importance of homemaker
in the scheme of their things and hence have been actively targeting the homemakers to buy their
products. The healthy milk products are a hit with them and the kids love the taste of its ice
creams.
Engro foods recognize the contribution of active advertising to make high sales. The vision of
the company is “Elevating Consumer Delight Worldwide” and for this purpose, it has taken the
help of print media to highlight its products in every nook and corner. Billboards magazines and
newspapers are an important part of their strategy. Besides this, they have created noticeable ads
that are colorful with catchy tunes and made them a part of the electronic media specially the
television and radio. Advertisements are also displayed on vehicles like the bus, trucks and
trams.
STRATEGIC Internal and external Audit

i. STEEPLE Analysis

No organization exists in a vacuum; the environment within which the firm has to operate will
affect the way that strategy is both planned and carried out and changes in the environment is
also the most likely reason for making changes in the strategy. Changes in the environment are
also the most likely cause of failure of strategic plans. The most carefully calculated strategy
would be able to drive the market in the favor of the organization and will maneuver the external
environment in the best possible way. Engro Foods like all the organizations they also have to
face such kind of environment which is very dynamic. Being in the market as a challenger they
have to face all the external factors and have to come up with them accordingly

S - Social Factors

Engro food has helped to bring about a change in life style of the Pakistani People by introducing
UHT Milk, as the literacy rate is improving and it is resulting in a better awareness of the olpers
and Tarang UHT treated milk and is helping them improve their sales and Milk with its basic
benefits has helped improve the image and more usage has been seen in the past years. Special
awareness Campaigns can also be launched and can help portray a better image of the product in
front of the customers. The attitudes of the people are also changing with the passage of time so
as a result the usage of open gawala milk is changing and people are opting out the usage of
standardized packed milk.

T - Technological Factor
The type of the technology available within the industry states the competitive environment
because creative use of new technology is what often gives firm there competitive advantage.
This environment does not change that much quickly but the changes that come are strong
enough that can change the way the industry is currently running. Haleeb production process
uses UHT (Ultra High Treatment) technology. Engro food administrators claim that their plant
adopted the latest technology for milk processing and thus it had an edge over other around
twenty plants in competition including Haleeb, Milkpak as all other plants were based on
obsolete European technology. The idea behind UHT investment was to provide consumers with
the best quality of packaged dairy and food products that no other company can produce.

E - Economical Factor

Engro Foods is strongly affected by both the Economic and the Demographic environment
around and have to keep on taking different steps to respond accordingly. There is no sales tax
on the milk. Hence it is a real plus point. Material supply and shortages are faced by the
company for both Packaging and for the product it, as milk’s production is seasonal and keeps
fluctuating and adequate steps are required to be taken in order to keep it working smoothly.
Haleeb also don’t charge interest on its products which also makes a huge difference
economically.

E - Environmental Factor

As, the environment always effect the way strategies are being carried out and implemented.
Engro Foods like all the organizations they also have to face such kind of environment which is
very dynamic. Being in the market as a challenger they have to face all the external factors and
have to cope up with them accordingly. Haleeb have the strategies to positively engage the staff
in work and boost up their moral. Engro food has a friendly environmental culture within the
organization to make their employees comfortable and to deal with the external problems. There
are few seasons in which the availability of milk reduces that effect the production of milk and
left Engro food with fluctuated sales.

P - Political Factor

Engro food also abides by the rules formed by the Government and set their strategies that are
according to the laws and legislations of the Government they are working under. Tetra Pack
(brick pack), that was for the first time that milk came in that form soon followed by the Nestlé’s
Milk Pak which as a multinational rocked the UHT Milk industry of Pakistan. They are not
actually bound under any sort of trade agreements. As far as the employment laws are concerned
Engro food abides to laws set by the government for trade policies, government policies and
completes its responsibilities in a better manner.

L - Legal Factor

Engro foods always stand by the rules and legal conditions imposed by the Government and set
their strategies that are according to the employment laws and legislations of the Government
they are working under. Engro food always keeps its department updated about what is
happening in the sector or milk industry, and that will help them to make their strategies
accordingly. Engro foods have the legal laws like, Minimum wage, working time, Food stuffs,
Engro foods don’t believe in Under 18 working, Occupational/ industrial Training,
Environmental regulations, Consumer protection Industry-specific regulations etc.

E - Ethical Factor

Engro foods are well renowned company operating in the milk industry since 2002. And the
reason for this is importantly their ethical values. They don’t sale on credit or on interest because
they consider it unethical and not according to the law of our religion
PORTERS FIVE FORCES MODEL

THREAT OF NEW ENTRANTS:

The average entrepreneur can't come along and start a large food company. The threat of new
entrants lies within the food industry itself. Some companies have carved out niche areas in
which they underwrite dairy supply. These food companies are fearful of being squeezed out by
the big players. Another threat for many food companies is other food services companies
entering the market.

• Capital requirements
Competing in a new industry requires resources to invest. Production of packed products requires
huge investment of financial, human, technical, and marketing resources. At the moment Engro
Olper’s have some threats like from new entrant’s goodmilk product of shskargang food.

• Economy of scale

Economy of scale determines entry because they force potential competitors either to enter on a
large scale bases (a costly and perhaps risky move) or to accept a cost disadvantage. Moreover,
new entrants in the pasteurized milk business may encounter scale related barriers not just in the
production, but in the advertising marketing, distribution, financing, and raw milk purchasing as
well, Engro Foodss achieved its breakeven in 2003
BARGAINING POWER OF SUPPLIERS:

The suppliers of food might not pose a big threat, because of the reasons;

• Number of suppliers

Raw milk is standard commodity and is available in the open market from a large number of
milkmen. If anyone refuses to sell its product then company can buy it from others who are
already willing to sell to company.

• Importance of volume to supplier

Suppliers also have less leverage to bargain over price because the company is purchasing the
large volume of their milk and suppliers don’t have much option to sell milk to others.

BARGAINING POWER OF BUYERS:

The individual doesn't pose much of a threat to the food industry. Large clients have a lot more
bargaining power with food companies. Large corporate clients like airlines and retailers pay
millions of dollars a year. There are large numbers of distributors, who are buying and
distributing the product, so their bargaining power is low and company have leverage to dictate
implement its terms and conditions to distributors.

• Backward integration

Another reason of low bargaining power is that no buyer/distributor has the resources to start
involve in backward integration.

AVAILABILITY OF SUBSTITUTES:

This one is pretty straight forward, for there are plenty of substitutes in the food industry. Most
large food companies offer similar suites of services. Companies focusing on niche areas usually
have a competitive advantage, but this advantage depends entirely on the size of the niche and on
whether there are any barriers preventing other firms from entering.

COMPETITIVE RIVALRY:

The food industry is becoming highly competitive. The difference between one Food Company
and another is usually not that great. As a result, food industry has become more like a
commodity - an area in which the food company with the low cost structure, greater efficiency
and better customer service will beat out competitors. Food companies also use higher
investment returns and a variety of food investment products to try to lure in customers. In the
long run, we're likely to see more consolidation in the food industry. Larger companies prefer to
take over or merge with other companies rather than spend the money to market and advertise to
people.

Not only local but attempts by cross border competitors or companies to gain stronger foot hold
in each other’s domestic market boosts the intensity of rivalry, especially when the foreign rivals
have lower cost or very attractive products. In case of Engro foods so far nestle and hale are the
only diverse rival and another players that has just joined the UHT Milk sector is goodmilk, no
doubt the competition between Engro Foodss and Haleeb is quite intense both are engaged in
consistent homework just to break and attract the customer towards each other but goodmilk is
adding to the competition between the sector.

SWOT Analysis
Strength
Engro’s back.

Olper’s is a brand of ENGRO foods. This means that consumers can relate their former image of
ENGRO foods to Olper’s. ENGRO is a well-established brand name in Fertilizer, IT and
infrastructure business. The brand is well known so customers will automatically have a brand
association with Olper’s and see it as a premium quality product. ENGRO is world renowned so
it can easily attract foreign investors in backing it against other competitors such as Nestle.
ENGRO foods can easily afford research and development costs for Olper’s have in order to
introduce new products. It can also distribute the brand through better channels because of its
long term relationship with distributors in the agriculture sector.

PR with farmers

ENGRO 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, EFL crossed 1.4 billion sales figure which shows customers’ satisfaction upon
EFL’s products. 4. Its taste, quality proposition and world-class quality proposition system.
Strong consumer & product research

Olper’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, EFL has hired various global research partners like AC
Nielsen, Mindshare, JWT Asiatic and MARS marketing and advertising agencies.

Third-Generation Plant
EFL only, has the third-generation UHT milk plant in the country. EFL plant is the only plant in
Pakistan that uses Bactofuge technology to virtually eliminate bacteria and ensure premium
quality and hygiene. Moreover, it is also setting up another milk processing plant in Central
Punjab (Sahiwal) with an investment of Rs. 2 billion (US $ 33 million).

• Worldwide fame of Engro.

• Efficient milk collection system.
• Keeping high quality standards.
• Integrated distribution and warehousing facilities.
• Successful related diversification.
• Generic brand name of Olper’s
• Large market share of Engro innovative and chemicals.
• Having Good reputation in the market by strong brand name i.e. Engro

Weaknesses
Olwell TVC
Olwell ad which is based on Western life style, ENGRO foods brand management showed a man
who put off his clothes & remain just in his undergarments, or half nude lady in a cat walk or
men admiring the figures of a lady in mix gender health club. In this ad they are creating
associations with the brand through the stripes, which is a highlight of Olwell packaging. Half
naked people have been shown with tattoos of the same stripes in order to show that they are
loyal consumers of Olwell. Also, the talent, situations and locations connects well with the ad to
give Olwell a premium positioning. The brilliant marketing people at ENGRO Foods failed to
analyze is that the market they are targeted the ad on, is Pakistan, where practicing Muslims
reside, who have strong religious beliefs. When making the ad, the brand managers were focused
on, making an ad that should give the brand the most premium look and feel amongst the target
consumers but on the other hand they were least bothered about the ethics, religious beliefs and
cultural values.
Owning Red Color
The company has not owned the color red like Nestle has a green Milkpak; Haleeb has a blue
carton etc. This may create problems because when a consumer enters a grocery shop, then
he/she might have problems in recalling the brand because there is no color association attached
to Olper’s. The company may need to find a suitable color in which to focus its upcoming
marketing strategies.
Low Quality Milk
EFL 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
EFL is dependent upon Tetra Pak for the packaging of its entire dairy products. Tetra Pak is the
only option available to Olper’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
EFL’s 34 out of 40 milk-collection centers are located in Punjab, where as its only milk
processing facility is situated near Sukkur (Sindh). It increases the milk collection & distribution
costs; and also increases the chances of milk getting spoiled because of increased traveling time.
Narrow brand portfolio
It has been more than a year now, when EFL launched its first dairy product, Olper’s Milk on
March20, 2006. But EFL’s brand portfolio still consists of just 3 products i.e. Olper’s Milk,
Olwell Milk and Olper’s Cream. Whereas its competitors like Nestle and Haleeb Foods have a
much diversified line of dairy products.

• Unable to compete in price sensitive segment of UHT milk market.

• Under-utilization of the capacity.
• Unable to fulfill the demand of local powder milk market.
• Not yet ISO certified

Opportunities
Increased funding by Government
Government has decided to increase farmers’ funding. This is an opportunity for ENGRO 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.
Third largest producer of milk
Pakistan is the Third largest producer of milk in the world with a total production of 32 billion
liter of milk a year, whose value is more than that of the combined value of wheat and cotton,
from a total herd size of 50 million milch animals (buffaloes and cows). Livestock accounts for
46.8 percent of agricultural value added and about 10.8 percent of the GDP. Milk is the largest
commodity from the livestock sector accounting for 51 percent of the total value of the sector.
Due to the steps taken by the government and private sector, country’s annual milk production is
expected to grow at an additional 3 billion liters in the next few years. This is quite an
opportunity for ENGRO foods as there is lot of growth in this part of the sector.

• Improving Economy
• Population growth rate.
• High urbanization rate.
• High literacy rate.
• Flexible government policies for food industry.
• Have significant growth opportunities
• Has sufficient capital to expand.
• Has the potential to innovate and differentiate the company's products to sustain a
competitive advantage
• May merge with other global businesses to eliminate competitors.
• Having Capable of expanding into other markets of the world

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 Olper’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 Olper’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 Olper’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.
Has many major global competitors with its main one being Nestle Pakistan, Haleebfoods can be
substituted by other milk producer made by its competitors.
These competitors may develop marketing strategies to eliminate The Engro Foodss Olpers.
There may be an economic downturn in the business cycle.

• High inflation rate.

• Low purchasing power.
• Decrease in GDP growth rate.
• Increasing interest rates.
• Decreasing investment.
• Recessionary period in business cycle
• Competition with Nestle, Engro Foods and the new entrants.
• Engro Foodss is currently facing are increase in Sales Tax

INDUSTRIAL SWOT ANALYSIS

Strength

• Endowed with the very good breed of buffalos and cows

• Highest per capita consumption of milk in Asia
• Regular culling of less productive/unproductive animals
• A high ratio of agricultural land to agricultural ratio
• An emergence of commercial dairy farms on a large scale

Weaknesses

• Small and scattered animal holding

• Prevalence of traditional raw milk marketing system
 • Poor quality of milk; lack of remunerative producer price for milk
• Milk processing predominantly dependant on obsolete UHT technology
• Mushrooming growth of cattle colonies in suburban areas; High cost of milk
• Production; a long chain of middle men
• Inadequate infrastructure and institutional facilities and support
• Low utilization of installed capacity of dairy plants
• Poor quality of animal health care and breeding services; lack of professional
management

Opportunities

• Huge unsatisfied demand of milk and milk products.

• Substantial scope for increasing milk production through improvement in the marketing
system by ensuring a year round remunerative price to milk producers
• Increase consumer awareness of healthy eating

Threats

• Unregulated imports of dairy products at cheap prices

• Inadequate public and private investment in modernization of the sector
• Vested interests in perpetuating the dependence on imports of dairy commodities

SWOT Matrix

The concept of determining strengths, weaknesses, threats, and opportunities is the fundamental
idea behind the SWOT model. To present the model in a more understandable way, scholars
came up with so-called SWOT matrix. SWOT matrix is only a graphical representation of the
SWOT framework.
SWOT Matrix for Engro foods.

Strengths Weaknesses
1. Worldwide fame of Engro.
2. Efficient milk collection 1. Unable to compete in price
SUPER SWOT system. sensitive segment of UHT
3. Keeping high quality milk market.
standards. 2. Under-utilization of the
4. Integrated distribution and capacity.
warehousing facilities. 3. Unable to fulfill the
5. Generic brand name of demand of local powder
Olper’s milk market.
6. Large market share of 4. Not yet ISO certified
Engro innovative and
chemicals.
7. Having Good reputation in
the market by strong brand
name i.e. Engro
8. Strong R&D
Opportunities SO WO
Increase production of quality As per the increase demand of
milk to cater the unsatisfied the milk they should fulfill the
1. Improving Economy demand(S2,O2,O8) demand as EFL have the
2. Population growth rate. ability to expand
3. High urbanization rate. They should go in the product
4. High literacy rate. line of powdered milk. They should make a strong
5. Flexible government distribution system to cater to
policies for food industry. avail the full benefit of the
6. Have significant growth They should increase their growing market
opportunities exports.
7. May merge with other They should cater the wide They should adopt affective
global businesses to range of unsatisfied demand by marketing strategies for the
eliminate competitors. improving their distribution promotion of their product
8. Having Capable of networks
expanding into other
markets of the world
Threats ST WT
1. High inflation rate. Invest more on the dairy The co-ordination between
2. Low purchasing power. product line as there is still a different departments of EFL
3. Decrease in GDP growth large chunk of the market should be improved it will
rate. which require lessen the bureaucratic cost
4. Increasing interest rates. modernization(S6,T5) and increase the efficiency of
5. Decreasing investment. the company.
6. Recessionary period in
Introduce new technology for
business cycle
quality assurance and better
7. Competition with Nestle, Engro must get the ISO
productivity
Engro Foods and the new certification as to beat their
entrants. competitors

KEY SUCCESS FACTORS:

• Research & Development
• Financial Position
• Market Share
• Product Quality
• Price Competitiveness
• Management
• Global Expansion
• Customer service
• Network Sales and Distribution
• Production Capacity
• Alliances

COMPETITIVE ANALYSIS
The strategic priorities of Nestle Pakistan are claimed to be focused on delivering shareholder
value through the achievement of sustainable, capital efficient and profitable long-term growth.
Improvements in profitability would be achieved with due respect to quality and safety standards
at all times.
In line with the above objective, Nestle Pakistan aims at growing into a number one food
company in Pakistan in the shortest possible time with the unique ability to meet the needs of
consumers of every age group - from infancy to old age, for nutrition and pleasure, through
development of a large variety of food categories of products with highest quality.
Nestle Pakistan envisions that the company should develop an extremely motivated and
professionally trained work force, which would drive growth through innovation and renovation.
Special training programs have been designed for employees at each level to keep up with and
develop this vision.
The study concludes that Nestle has a significantly high growth rate (36%) and has grown and
developed at a high pace in short span of time. On the other hand Haleeb has a market share of
28%. And Engro Foodss having 21% the major contributor toward this growth and development
are human resource, marketing and sales departments. The major contributor is its appropriate
strategy particularly its relationship with the social and environmental sectors. Perhaps this is the
reason that it in spite of being a multi-national has been well accepted in Pakistani culture. There
are ample chances of its survival in future.
• Keeping new players such as Olper’s, and the old one’s like Haleeb, Nestle focused more
on advertising.
• Nestle have been experiencing a constant increase in cost with raw material contributing
the larger part of this increase. Haleeb having their own suppliers so the raw material cost is bit
low.
• Nestle maintained its value of gross profit margin around or above 30% to ensure that it
has a strong control over its costs, and the efficiency of production. But on the other hand,
Haleeb faced a bit of down fall when Olpers introduced their campaign.