Major Project - Ics, Orion Food Industry

ORION FOOD INDUSTRY
“A STUDY ON THE FUTURE CHALLENGES, OPPORTUNITIES, AND

IMPLEMENTION OF CHANGE THROUGH EFFECTIVE PLANNING, A CASE
STUDY ON ORION FOOD INDUSTRIES SDN BHD, MALAYSIA.”
SUBMITTED BY:
NASHIAB KALLUMKAL RASHEED
STUDENT ID: 0030VMVM1011
MASTER OF BUSINESS ADMINISTRATION
CARDIFF METROPLITAN UNIVERSITY
YEAR OF SUBMISSION: SEPTEMBER 2012
0030VMVM1011 Page 1
ORION FOOD INDUSTRY
EXECUTIVE SUMMARY
Orion Food Industry Sdn Bhd is a wholly owned subsidiary of Portwest Group of Companies.
The company is engaged in the business of pre packaged meals in Malaysia and in some
abroad countries. This plan was prepared to address the various problems/ issue faced by
Orion in order to have strategic growth and the difficulties faced by them in targeting some
foreign countries and to suggest recommendations to implement various strategies and
sophisticated planning in future. The business objective is to provide quality and well
packaged meals in the country, to expand its business in to larger overseas markets and to
establish in the field of convenience foods. The financial objective includes to increase the
sales revenue by 11.5 Million after 3 years and also to maintain a strong cash inflow over the
years.
The consumer perception is increasing and also the demand for their products. As the
business is growing it lacks the infrastructure and sophisticated planning. They should ensure
enough manpower and resources for their future growth. This report includes the analysis of
various market conditions, the opportunities and threats to Orion in Malaysia and the targeted
country U.K. The competition is high for Orion foods as there are a large number of foreign
fast food companies in Malaysia. Another threat identified is the growing health concern
among the people which restricts them from consuming convenience foods. Including
healthier menus can attract new customers. Various models and tools were applied to know
the strategic options available to them and the feasibility of their future markets. Various
weaknesses were also identified in different departments and recommendations are provided.
Different strategies which need to be adopted in future are also recommended. A change
management plan is prepared in order to identify weakness and company infrastructure. The
financial feasibility is also calculated and the future cash inflow and net profit were also
analysed. From the detailed analysis it is found that Orion possess a great potential for future
growth with the help of proper planning. The company can increase its market share and
competitive advantage and can be a market leader in packaged meals within 3 years and also
accomplish their vision to be listed in the Malaysian Stock Exchange.
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ORION FOOD INDUSTRY
ACKNOWLEDGEMENT
First of all I thank the Almighty for his blessings and support given to me for completing this
report.
I express my sincere gratitude to my Project Guide Dr. Kui Juan Tiang for his valuable
support and advice given to me throughout this project. His encouragement and his high
standards throughout the project period have supported me to complete this project.
Moreover, I would also like to express my gratitude to Mr. Baldev Singh, Deputy Principal
for his timely information and guidance during the study.
Finally I also like to thank my friends and family for their help and mental support during this
project work.
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ORION FOOD INDUSTRY
CONTENTS
CHAPTER -1 CASE STUDY BRIEF........................................................................................9
1.1 CASE SUMMARY....................................................................................... 9

1.2 OBJECTIVES...............................................................................................9
1.3 ISSUE...........................................................................................................10
1.4 PARTIES INVOLVED................................................................................10
1.5 EXPECTED OUTCOMES.........................................................................10
1.6 TIME FRAME AND BOUNDRIES............................................................10
CHAPTER -2 INTRODUCTION................................................................................................11
2.1 REPORT DESIGN AND RATIONALE..................................................11
2.2 ACTIONABLE ASSUMPTIONS..............................................................12
2.3 BUSINESS MODEL....................................................................................13
2.4 TIME HORIZON FOR THE WOK UNERTAKEN...............................14
CHAPTER -3 PROBLEMS/ OPPORTUNITY STATEMENT AND ANALYSIS PLAN...15
3.1 PROBLEM/ OPPORTUNITY STATEMENT.........................................15
3.2 RESEARCH QUESTIONS.........................................................................16
3.3 RESEARCH OBJECTIVES.......................................................................16
3.4 DATA COLLECTION................................................................................17
3.5 ANALYSIS TOOLS USED.........................................................................18
CHAPTER – 4 ANALYSIS AND FINDINGS...........................................................................23
4.1 CANVAS MODEL........................................................................................23
4.2 SWOT.............................................................................................................24
4.3 PORTER’S FIVE FORCES.........................................................................30
4.4 ANSOFF.........................................................................................................33
4.5 PORTER’S DIAMOND................................................................................37
4.6 PEST ANALYSIS..........................................................................................40
4.7 FEASIBILITY OF TARGET MARKET- U.K..........................................44
4.8 KEY FINDINGS.............................................................................................49
CHAPTER – 5 PROPOSED PLAN OF ACTION........................................................................50
5.1 INDUSTRY ANALYSIS................................................................................50
5.2 COMPANY HISTORY..................................................................................53
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ORION FOOD INDUSTRY
5.3 MARKET ANALYSIS....................................................................................55
5.3.1 MARKET SEGMENTATION..............................................................63
5.3.2 MARKET SIZE.......................................................................................64
5.3.3 MARKET NEEDS..................................................................................64
5.3.4 MARKET TRENDS AND DEMAND.................................................64
5.4 PRODUCTS....................................................................................................65
5.4.1 PRODUCT DESCRIPTION.................................................................65
5.4.2 FUTURE PRODUCTS AND SERVICES...........................................66
5.5 CUSTOMER ANALYSIS.............................................................................67
5.6 VALUE CHAIN ANALYSIS.......................................................................69
5.7 STAKEHOLDER ANALYSIS....................................................................71
5.8 VISION...........................................................................................................74
5.9 BUSINESS OBJECTIVE.............................................................................74
5.10 FINANCIAL OBJECTIVE.......................................................................74
5.11 COMPETITIVE POSITIONING.............................................................74
5.12 STRATEGIES FOR SUSTAINABILITY...............................................75
5.13 CRITICAL SUCCESS FACTORS...........................................................78
5.14 SMART OBJECTIVES..............................................................................80
5.15 CHANGE MANAGEMENT PLAN AND IMPLEMENTATION
PLAN............................................................................................................82
5.16 GANTT CHART.........................................................................................88
5.17 INTERNATIONAL ENTRY STRATEGY – U.K..................................90
5.18 INTERNATIONAL MARKETING STRATEGY U.K.........................92
5.19 FINANCIAL PROJECTIONS..................................................................95
5.19.1 PROJECTED CASH FLOW..........................................................95
5.19.1 PROJECTED INCOME STATEMENT......................................96
5.19.3 PROJECTED BALANCE SHEET...............................................97
5.20 NEXT STEPS TO BE TAKEN................................................................98
REFERENCES
APPENDIX
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ORION FOOD INDUSTRY
LIST OF TABLES
TABLES PAGES
Table 2.4 - Showing the time horizon of the work table undertaken.......................14
Table 4.6 - Showing the demographic classification of Malaysia.............................42
Table 4.7- SWOT analysis of U.K food industry.....................................................46
Table 5.1 -Showing the growth of processed and packaged foods in Malaysia
during the year 2009 and 2010..................................................................51
Table 5.2.1- Showing the sales revenue and forecasted sales of Orion Food
Industry Sdn Bhd in different years........................................................54
Table 5.2.2 – Orion Food Industry financial performance indicators.........................54
Table 5.3 – Showing the number of fast food chains in Malaysia...............................55
Table 5.15 – Showing the risks and costs involved in the Change
Management Process. ...............................................................................84
Table 5.17 – Feasibility analysis of different entry modes to U.K...............................91
Table 5.17.1 – Product modification strategies that can be adopted
while entering U.K....................................................................................92
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ORION FOOD INDUSTRY
LIST OF FIGURES
FIGURES PAGES
Figure 3.4 – Showing the different types of data collection methods.................................17
Figure 4.1 – Canvas Model Application...............................................................................23
Figure 4.2 – SWOT analysis Application.............................................................................24
Figure 4.2.1 – Showing the type of materials used for retort pouch packaging....................25
Figure 4.2.2 – Number of people who are eating at home and eating away
from home........................................................................................................27
Figure 4.2.3 – Showing the maximum number of pre packaged meals in different
countries of Europe...........................................................................................28
Figure 4.2.4- Showing the number of diabetics people in Malaysia due to the
consumption of Fast foods..................................................................................29
Figure - 4.3.1 Showing the market penetration strategies that can be
adopted by Orion...............................................................................................33
Figure - 4.3.2 Showing the product development strategies that can be
adopted by Orion...............................................................................................34
Figure - 4.3.3 U.K food industry snapshot.............................................................................35
Figure - 4.5 Porter’s Diamond Model- Malaysia advantages.................................................37
Figure - 4.5.1 Showing the business competitiveness ranking of Malaysia............................38
Figure - 4.5.2 Showing the export of different clusters in Malaysia.......................................39
Figure - 4.6 GDP growth and banks lending rates in Malaysia during
different years......................................................................................................41
Figure- 4.7 Gross value added by different manufacturing sectors in U.K............................44
Figure – 4.7.1 Government debts of different countries in Europe, Q4-2011........................47
Figure – 4.7.2 Showing the GDP growth in U.K in different years........................................48
Figure – 4.8.1 Showing the number of people who are preferring to buy Orion
Foods..................................................................................................................50
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ORION FOOD INDUSTRY
Figure – 4.8.1 Showing the number of people who like to buy Orion foods with healthier
menus and low fat.............................................................................................50
Figure – 4.8.1 Showing the number of people suggesting marketing and promotion
To Orion to increase brand awareness...........................................................51
Figure – 5.1 Showing the factors that are leading to the consumption of
convenience foods...............................................................................................52
Figure- 5.3 Consumer spending habits on different products................................................62
Figure- 5.3.1 Market Segmentation of Orion Food Industry..................................................63
Figure – 5.5 Customer analysis chart......................................................................................67
Figure- 5.5.1 Customer analysis of Orion Food Industry.......................................................67
Figure – 5.7 Stakeholder analysis of Orion.............................................................................71
Figure – 5.12 Promotion strategies that can be adopted by Orion..........................................76
Figure – 5.12.1 Forecasted sales of Orion in different months...............................................77
Figure – 5.14 Forecasted sales of Orion in different years......................................................80
Figure- 5.15 Change Management plan structure....................................................................83
Figure – 5.15.1 Future management roles that should be followed by Orion.........................84
Figure- 5.17 – International Entry mode – U.K.......................................................................90
Figure- 5.18.1 Showing the percentage of online retail in U.K...............................................92
Figure – 5.19.2 Showing the type of media which influenced most in buying
convenience Food in U.K.......................................................................................93
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ORION FOOD INDUSTRY
CHAPTER1
CASE STUDY BRIEF
1.1CASE SUMMARY
Orion Food Industry Sdn Bhd Malaysia is engaged in selling pre packaged meals to the
public. They are gaining high consumer perception in Malaysia. They are also exporting their
products to various foreign countries. The next target market for Orion is European markets,
Particularly U.K. This case report includes the various problems faced and opportunities of
Orion Food Industries in Malaysia and in foreign countries. Various models and analysis
tools are used in the report to analyse the home market as well as the feasibility of the target
market. Specific time horizons are set for the objectives, the changes needed are
recommended and action plan is prepared. A proposed plan is also suggested for the industry
which includes the broad strategies, critical success factors, change management plan as well
financial projections for the next three years.
1.2 OBJECTIVES
The various objectives of Orion Food Industry are:
TOOLS AND MODELS USED
The various tools and models used in analysing the Orion Food Industry are:
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ORION FOOD INDUSTRY
1.3 ISSUE
The issue involved for Orion Food Industry is lack of planning and analysis in international
market entry, marketing techniques and budgetary plan for the future. The role of the
consultancy is to solve this problem by conducting detailed analysis, plan and
recommendations.
1.4 PARTIES INVOLVED
The parties involved in the preparation of the report are Atlas Brown Plc, Consulting
Company.
1.5 EXPECTED OUTCOMES AND RECCOMENDATIONS
The analysis with the help of various models and tools will help Orion Food Industry to
understand their limitations in terms of resources, manpower and technology and also the
various opportunities available to them at home and overseas market. By analysing Orion
Food Industry with various tools and models, a proposed plan is prepared which includes
various recommendations and forecasts. This includes identifying various Critical Success
Factors, broad strategies, market analysis, SMART objectives, Change Management Plan and
Financial Projections.
1.6 TIME FRAME AND BOUNDRIES
Specific time frame and boundaries are set for this case study report. The various time
horizons of the report and time taken for Orion Foods for future growth are illustrated with
the help of Gantt chart and Action plans.
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ORION FOOD INDUSTRY
CHAPTER – 2
INTRODUCTION
2.1 Report design and rationale
The report undertaken is designed in a systematic and sequential manner. The five chapters in
the report outline the step by step process and the amount of work undertaken in the report.
The report begins with the case study brief which briefly explains the terms of reference and
the scope of work undertaken. The following chapter includes the Introduction part which
describes the theoretical framework of different strategic models which are used to interpret
the Orion Food Company. Different models such as SWOT analysis, Porter’s Five Forces,
Ansoff Matrix and so on are illustrated theoretically to understand the importance of these
models and how they will be useful in the analysis of Orion Food Company. The third
chapter includes the problems or the issues faced by the company and the opportunities
available for them in order to have a sustainable growth in the next 3 years. This section also
includes the various research questions and research objectives and the data collection
methods adopted in order to gather data from specified sources. It also includes the concept
behind undertaking the study. The next two chapters includes the in depth analysis and
interpretation of Orion Food Company. The fourth chapter includes real application of
strategic models to the Orion Food Company in the home country and also while targeting
the overseas market. The major limitations are also addressed while applying the models. It
also includes the various factors causing the problem or issue. Key findings are derived
which is critical aspect of the report. The final chapter includes the vital part of the report
which include the overall business plan, proposed plan for the future as well as the critical
success factors which lay the foundation for Orion Food Company to have a sustainable
growth over the coming years. The case analysis is done to understand the internal factors as
well as the external environment of Orion food industry and the various strategies which can
used while targeting a particular market. Different models and tools were used to develop the
industry competitiveness and these laid down the recommendations for strategic growth.
Applying all the tools and by implementing change it is understood that Orion possess a high
sustainable growth in future.
ORION FOOD INDUSTRY
2.2 ACTIONABLE ASSUMPTIONS
 With proper changes in the overall business plan Orion food industry can achieve its
vision in 3 years which is to list the company in the Malaysian Stock Exchange.
 The U.K market shows great potential for packaged foods. The entry to U.K market
will create substantial profit for Orion in future.
 The demand for convenience foods in Malaysia will increase dramatically creating
greater opportunities for Orion foods.
 The implementation of ERP systems will help Orion to cut down costs and provides a
better control over the overseas market.
 Orion will achieve a net profit of 5.8 Million dollars after 3 years.
 In future the business will enter in to other countries of Europe and also target Asian
market due to increased consumer perception.
ORION FOOD INDUSTRY
2.3 BUSINESS MODEL CANVAS
http://ingenia.wordpress.com/tag/business-model-canvas/
Orion Food Industry should develop successful business models in order to identify niche
against competitors. The Canvas Model is an important tool for Orion which provides route
to innovation and future growth. It consists of 9 different segments which helps the business
to identify its key resources and objectives. The application of this model is done in the
following chapters. The nine different segments are:
ORION FOOD INDUSTRY
2.4 Time horizon for the work undertaken
TABLE 2.4.1
NO TASKS JUNE JULY AUGUST SEPTEMBER

W1 W2 W3 W4 W1 W2 W3 W4 W1 W2 W3 W4 W1 W2 W3 W4
1. PROJECT
BRIEFING
AND
SUMMARY
2. TITLE
SELECTION
AND
CONFIRMA
TION(ICS)
3. INTRODUC
TION AND
CASE BRIEF
4. PROBLEM
IDENTIFICA
TION AND
DATA
COLLECTIO
N
5. ANALYSIS
AND
FINDINGS
6. OVERALL
BUSINESS
PLAN
7. CONCLUSI
ON
8. SUBMISSIO
N
ORION FOOD INDUSTRY
CHAPTER – 3
THE PROBLEM OR OPPORTUNITY SITUATION AND THE ANALYSIS
PLAN
3.1 PROBLEM/OPPORTUNITY STATEMENT
The problem involved with Orion Food Industry is lack of proper planning and forecasts for
the sustainable future growth. Orion has been well positioned in Malaysia and the business is
getting sufficient profits. But as they grow they lack the resources, manpower, technology
and proper budgetary plans. The current business plan does not support the company when
going international in to dynamic markets. This report identifies the various hazards faced by
Orion in Malaysia and when going international. Various business models and analysis tools
have been used to evaluate Orion. Detailed proposed plan and recommendations have been
provided in order sustain their future growth in home country as well as how to enter
international markets.
PROBLEMS FACED
ORION FOOD INDUSTRY
3.2 RESEARCH QUESTIONS
 How does the application of various strategic tools and models will help Orion Food
Industry in future expansion?
 What are the various marketing problems faced by Orion Food Industry in Malaysia
and the targeted international market?
 Why Orion Food Industry should target U.K market in terms of future international
expansion?
 How does the poor ICT infrastructure and HR policies affect Orion Food Industry in
sustainable future growth?
 How does a change management help Orion Food Industry for future sustainable
growth?
3.3 RESEARCH OBJECTIVES
 To analyse the application of various strategic tools and models and its impact on
Orion Food Industry in future expansion.
 To diagnose various marketing problems faced by Orion Food Industry in Malaysia
and abroad countries.
 To explore the feasibility of U.K market to Orion Food Industry in terms of
international expansion strategy.
 To identify the weakness of ICT infrastructure and other departments that can affect
the future growth of Orion Food Industry.
 To analyse the impact of change management on Orion Food Industry.
ORION FOOD INDUSTRY
3.4 DATA COLLECTION
Data collection involves gathering and maintaining sufficient and useful data relating to a
particular problem. The data collection plan is very important for any report and it should be
drafted in a systematic manner to capture sufficient data. Data collection involves collecting
data from either primary or secondary data.
DATA COLLECTION METHODS
FIGURE 3.4
Secondary data is largely collected in this report. Various reports and statistics of the
Malaysian food industry and data from the case report are also added. Information about
different models and tools are obtained from different internet sources and academic books.
Also feasibility of U.K food industry is done with the help of various online articles and
books about the U.K fast food Industry. Quantitative data are also used to showing different
facts and figures with the help of numerical data. The primary data is collected by conducting
a small survey by distributing a questionnaire to 50 respondents. The questionnaire is given
ORION FOOD INDUSTRY
to the people who were visiting the supermarkets. They were asked to fill the questionnaire
by themselves.
3.5ANALYSIS TOOLS USED
There are different tools and models used to analyse and interpret the Orion Food Industry.
These tools and models are briefly discussed in this chapter. The application of these models
to the Orion Industry is illustrated in the next chapter.
SWOT ANALYSIS
(Business Strategies, 2008)
Swot analysis is widely used by the companies today as a tool to evaluate the industry and to
take strategic movements in order to be competitive. This is used to determine the current
position of business, its position in the long run and also the economic climate of the
organisation. This model is being used business world since 1960 and still today it derive
create value when used in the organisation, management structure and marketing. The Swot
model, scans the company internally and externally. Internal environment includes the
Strength and Weakness while the External environment includes Opportunities and Threats.
ORION FOOD INDUSTRY
Strength includes what assets, resources, capabilities and ability of a company in

comparison to another company .Weakness includes the lose or absence in any critical area in
such a way that your competitor gain advantage out of it. Opportunities include the way or
route to grow for an organisation. There can be another market for the organisation, for
example niche market which can attract both existing as well as new customers. Threats are
something which can hinder the progress of the organisation. The organisation should find
some ways to avoid or overcome these threats. (Campbell, 2011)
PORTER’S FIVE FORCE MODEL
Porter’s Five Force model is an important tool to analyse the industry and its competitive
strength. This is a fabulous model to interpret specific environment of an industry. It is a
simple tool but is very effective to analyse the real power of a business situation. The Porter’s
Five Force model helps the analyst to know the power of his current competitive position and
its relative strength where he is planning to move. This is an important strategic tool in order
to analyse the competitive strength and position in the industry. It helps the company to
evaluate whether the new product, business or service is profitable in the future or not.
The five Forces are:
 Threat of New Entrants

 Threat of Substitutes
 Bargaining Power of Suppliers
 Bargaining Power of Buyers
 Intensity of rivalry
(Harvard Business Review, 2008)
ORION FOOD INDUSTRY
The porter’s five force model can be illustrated with the help of the following diagram:
(Mind Tools, 2008)
ORION FOOD INDUSTRY
PORTER’S DIAMOND MODEL
(Ivory Research, 2009)
Porter’s Diamond model is an effective strategic model in order to identify the competitive
factors in the home country and how these factors can be used to attain global competitive
advantage. This model is helpful for the companies to identify the competitive factors at
home and also which factors should the company improve when moving global. It helps the
company in investment decision globally. According to Porter there are four determinants
which can create national advantage:
 Factor Conditions
 Demand
 Relative and Supporting Industries
 Firm Strategy, Structure and rivalry
(Business Mate, 2012)
ORION FOOD INDUSTRY
Ansoff Matrix
Ansoff matrix is an important strategic tool used by all business with regard to its product and
market. This tool helps the company in to adapt its product in new product in exsisting or
new markets and also the choices for diversification. The four strategic options available are
Market penetration- Existing product in existing market
Product Development- New product in existing market
Market Development- Existing product in new market
Diversification - New product in the new market. (Write Pass, 2011)
PEST ANALYSIS
PEST analysis is widely used by the business in order to understand the Political,
Economical, Social and Technological environment of the country they are operating and
also to analyse the abroad markets. It helps to build the strategic vision of the business
effectively. It analyse the risk factors and unexpected changes occurring in the business.
ORION FOOD INDUSTRY
CHAPTER 4
ANALYSIS AND FINDINGS
APPLICATION OF MODELS AND TOOLS
4.1. CANVAS MODEL FIGURE 4.1
KEY PARTNERS KEY ACTIVITIES VALUE PROPOSITION CUSTOMER
PRE PACKAGED RELATIONSHIPS CUSTOMER

PORTWEST READY MEALS LOW COST
GROUP OF SEGMENTS
EASY TO
COMPANIES.
COOK DISTRIBUTORS
RELATIONSHIPS
3 MINUTES
PREPERATION STORAGE
ERP STRUCTURE RETORT POUCH CAPACITY
WEBSITES
PACKAGING
(FUTURE) WIDE MENU TIME
CONSCIOUS
SHOPS PUBLIC
KEY RESOURCES CHANNELS
NN
DISTRIBUTION SUPER
SYSTEM. MARKETS.
EFFICIENT
MANAGEMENT.
DISTRIBUTORS.
R&D.
COST STRUCTURE REVENUE STREAMS
ADVERTISEMENT COSTS. RETORT POUCH FOOD.
RAW MATERIAL COST. TIME SAVING.
PACKAGING AND LABELLING COST. AFFORDABLE.
ORION FOOD INDUSTRY
4.2.1 SWOT ANALYSIS
Scanning of external and internal environment is necessary for Orion Food Company in order
to have a sustainable growth over the 3 years. The SWOT analysis of Orion Food Company
is discussed below:
FIGURE 4.2
STRENGTHS WEAKNESS
 RETORT POUCH PACKAGING

 NO ERP INFRASTRUCTURE
 TIME SAVING IN PREPARATION
 LACK OF CUSTOMIZATION
 VARIETY OF CHOICES
 LACK OF PROMOTION
OPPORTUNITIES THREATS
 INCREASING CONSUMPTION OF
 GROWING HEALTH CONCERN IN
CONVENINECE AND OTHER FAST
MALAYSIA
FOOD BY PEOPLE OF MALAYSIA
 ENTRANCE OF LARGE NUMBER
 GROWING ECONOMY AND FOOD
OF FOREIGN FAST FOOD
INDUSTRY IN MALAYSIA
COMPANIES IN MALAYSIA
 GROWING DEMAND OF
CONVENIENCE FOOD IN U.K
ORION FOOD INDUSTRY
STRENGTHS
Retort Pouch Packaging
All Orion Foods use Retort Pouch Packaging which makes them differentiated in packaging
and outlook than their competitors. This technical kind of packaging is one of their strengths.
The merit of this type of packaging is that it can offer same shelf space stability which is
offered by other metal cans. All Orion foods use this type of technical packaging as it is a
feasible option for other metal cans and jars and also consumers globally prefer these type of
packaging as it is convenient for them. The idea behind using this type of packaging by Orion
Food industry is that it is light weight, shelf stable and easy food containers comparable to
the traditional cans. The following figure shows the outline structure of retort pouch
packaging: (Flair Packaging, 2012)
FIGURE 4.2.1
(Flair Packaging, 2012)
Requires less time in serving when compared to other industries
Another Strength of Orion Food Industry is that it requires less time in serving when
compared to other industries. It engage in pre packed meals and convenient foods which is
easy to deliver and cook. They target more on young and working population which
undergoes a busy schedule and also prefer fast foods and packaged foods.
ORION FOOD INDUSTRY
Offer a wide variety of choices
Orion Food Industry engages in providing to customers with a wide variety of choices. They
customize menu for different ethnic group of Malaysia such as the Chinese, Indians and the
Malays. They offer a variety of menus such as prawns, beef, chicken and other food sauces
and customize the menu in such a way that they follow the religious requirements of all the
religions.
WEAKNESS
No ERP infrastructure
Enterprise Resource Planning is required for any business today. With ERP systems
businesses can integrate and co ordinate different departments within the organisation. The
business activities which are starting from sales, to order, invoice, and receipt and so on are
streamlined while using ERP systems. (Abhi, 2011)
The following figure shows the structure of an ERP system:
(Epicor, 2008)
Orion Food Industries does not have an ERP in place. This can reduce their efficiency in
operations. They have an operating system which is outdated and old. This hinder their
decision making process and they need to design a new database like ERP to have a
sustainable growth in the future.
ORION FOOD INDUSTRY
No Customization of Foods
Orion Food Industries engage in pre packed meals where customization cannot be done. Once
the food is prepared it cannot be customized according to the wants of the customers. Orion
sells foods such as beef, lamb, food sauces and so on. So if the customer purchases the meals
and he wants it less spicy it is difficult to change as it is pre packed. So there is lack of
customization in choice of taste and preference.
Lack of Promotion
Orion Foods lacks promotional activities when compared to other convenience foods in
Malaysia. They also lack the promotional activities in abroad markets. They should create
brand awareness and brand image for their products. Adequate promotion can boost the sales
of Orion foods locally and internationally.
OPPORTUNITIES
Increasing consumption of Convenience and other fast foods by the people of Malaysia.
Despite of many health hazards the consumption of Convenience and other fast foods by the
people of Malaysia is increasing. Malaysia is a good market for Orion Food Industry. Most
the people including females are working in Malaysia. There are abundant opportunities for
Orion Foods because of the consumption patterns and dietary habits of the people in
Malaysia. The dietary habits and consumption patterns of the people in Malaysia shows that
they largely depend upon packaged and other fast foods.
The following figure shows the more people who are depending on convenience and
other fast foods are increasing over the years and also people who are eating at home are
dropping over the years.
FIGURE 4.2.2
5
4 Food from home
3
2
1
0 Food from
convinience and fast
foods
(Heng, 2007)
ORION FOOD INDUSTRY
Growing Economy and Food Industry in Malaysia
The Malaysian Food industry is growing rapidly over the years. This is an emerging
opportunity for Orion Foods. The exports of processed foods in now to more than 80
countries. In the coming years there are a lot of hypermarkets and supermarkets constructed
throughout Malaysia. The amounts of consumer who prefer to shop in these supermarkets can
keep chilled and convenient foods. This is an Opportunity for the Orion Foods to be placed in
these supermarkets and boost their growth. (Food Export Association, 2011)
Increasing Consumption of convenience foods in U.K
Recent data shows that the consumption of convenience ready meals in Europe particularly
U.K has increased. The number of people especially young adults has adopted the trend of
consuming pre packaged meals. The packaged meals in U.K include fresh vegetables,
tomatoes and dried pasta. Around 36 % of people purchase their evening meals from outside
and is still increasing.
FIGURE 4.2.3
Most number of packaged meals

consumed in different countries of Europe
90
80
70
60
50
Most number of packaged
40
meals consumed in different
30 countries of Europe
20
10
0
United France Switzerland Germany
Kingdom
(EUFIC, 2011)
ORION FOOD INDUSTRY
THREATS
Growing Health Concern in Malaysia
Malaysia is witnessing a new trend towards food consumption patterns of people. Most of the
people today are concerned about the health problems in such a way that they reduce the
consumption of fast foods. According to the survey conducted by the International Diabetes
Federation (IDF), 3.4 Million or 14.9% of the people in Malaysia are suffering from diabetes
in the year 2010. It also shows that the diabetes rate in Malaysians has increased due to the
over consumption of fast foods and other convenient foods. These types of reports forced the
people to shift towards a healthier food habits. This can be a threat to Orion Foods as the
number of people who is consuming food from outside reduces over the years. The following
figure shows the diabetic percentage of people of Malaysia. (Consumers Association of Penang,
2008)
FIGURE 4.2.4
(Consumers Association of Penang, 2008)
Entrance of large number of Foreign convenience and fast food Companies in Malaysia
Malaysia is a growing and demanding market for many foreign fast food companies. The
number of fast food companies entering Malaysia has become a threat to Orion Foods. These
companies are well established and have a strong brand name to attract the local people. The
number of foreign food companies entering Malaysia is increasing and they have a large
number of outlets all over Malaysia. Orion foods have to implement a strong and efficient
business plan in order to tackle these problems.
ORION FOOD INDUSTRY
4.3 PORTER’S FIVE FORCES
Porter’s five forces is an important tool to analyse the industry competitiveness of Orion
Food Industry. The five forces to the Orion Food Industry are applied below:
Threat of new entrant
The threat of new entrants for Orion Food Industry is relatively low. A company which is
trying to enter in to a business like Orion has to spend a lot on initial capital requirements and
also on R&D department. Orion Foods are now exported to various countries like Singapore,
Australia, Japan, Middle East, and USA. They have access to different distribution channels
also. For a new entrant it is difficult to access these distribution channels as well as cater
these export markets.
But a threat for new entrant can arise for Orion Food Industry. Malaysia has
got a large number of well established Food Industries which is either local or International.
So it is easy for these companies to diversify into convenience food segments because of
strong brand name and established network. So the threat of new entrant can arise to Orion
Food Industry.
Bargaining Power of Suppliers
(NPQ Business Portal, 2011)
The bargaining power of suppliers is relatively low for Orion Food Industry. Most of the
suppliers in the convenience food industry such as the agricultural or meat producers enter in
ORION FOOD INDUSTRY
to long term contracts with the food industry because of the availability of large amount of
raw materials in the industry. They suppliers enter in to long-term contracts because there a
lot of other suppliers in the market for the food industry. Therefore the bargaining power of
suppliers is low for Orion Food Industry.
Bargaining Power of Buyers
(MIFB, 2009)
The bargaining power of buyers is high for Orion Food Industry. The different buyers for
Orion Food Industry are supermarkets, food retailers and final consumers. The switching cost
of consumers is generally low when moving from one product to another and there are a lot
of other players in the market. So the buyer’s power is high for Orion Food Industry.
Intensity of Rivalry
The intensity of rivalry for Orion Food Industries is high with local and international
competitors. They have a large amount of competitors in the home markets and in the export
markets. Orion has to continuously differentiate and innovate in order to avoid competition.
They should be able to find niche markets in order to avoid competition.
ORION FOOD INDUSTRY
Threat of Substitutes
The threat of substitutes is medium for Orion Food Industry. There are a lot of substitutes for
packaged and other convenient foods. There are a lot of small restaurants available which
requires very less time for preparation and serving. But the main substitute for processed
foods are either making fresh food at home or in some restaurants in which most of the
people avoid because of time constraint. So the threat of substitutes is medium for Orion
Food Industry.
ORION FOOD INDUSTRY
4.4 ANSOFF MATRIX
The Ansoff matrix is used in order to identify the growth strategies of Orion Food Industry.
This section includes the four product/market combinations of Orion with the help of Ansoff
matrix.
Market Penetration
The Orion Food Industry must adopt certain penetration strategies in order to sell their
existing products in the existing markets. They need to capture the market share of their
existing competitors. The following CHART illustrates the key strategies that can be used in
market penetration of Orion:
FIGURE 4.4.1
PROMOTIONS:
INCREASE IN QUANTITY(20
OR 30% EXTRA WITH SAME
SAME PRICE)
FOCUS ON CHILDREN
MENU( BURGERS,FRENCH
FRIES)
ADVERTISEME ECONOMIES OF
NT(LOCAL SCALE(REDUCE
NEWSPAPER) UNIT PRICE)
MARKET
PENETRATION LEAST RISKY
ORION
 Promotions: In order to penetrate their products Orion should engage in some

promotions. For example they can increase the quantity of their products with the
same price; that is 20 or 30% extra in the same packet with the same price so that
more persons can eat. Another option is targeting the youth or children. They should
ORION FOOD INDUSTRY
emphasise some menu on children like including burgers and French fries along with
the meal without much increase in the price.
 Economies of Scale: Another way of market penetration can be economies of scale.
Orion is now having good sales on East and West Malaysia and also in some abroad
markets. They should focus on economies of scale on their home market in order to
reduce unit cost because much of their sales revenue is from Malaysia.
 Advertisements: Orion foods lack the advertisement in order to compete with their
competitors. For this they have to raise a large amount of money. Initially they can
target more on the local newspapers before going to large scale advertising.
Product Development
FIGURE 4.4.2
INCLUDING MORE MEDIUM RISK

SALADS AND
VEGETABLES
(GROWING HEALTH
CONCREN)
PRODUCT
DEVELOPMENT
ORION
PROVIDING SOUP
MIX WITH MEALS
Product development is a critical factor for Orion Food Industries because a lot of substitutes
are available in the market. To attract new customer’s product development is necessary for
Orion Foods. Product development of Orion foods can be done in the following ways:
ORION FOOD INDUSTRY
 Including more salads and vegetables: Growing health concern is a critical factor for
Orion foods. Now many people are emphasising on fat free or healthy foods. For this
Orion should include some salads and vegetables which will have the same life of that
of the other foods.
 Giving soup mix along with the meals: Another product development can be
including a soup mix with the meals. Most of the people like to have a soup before
having their meals. They can use this soup mix to prepare the soup either noon or in
dinner according to their convenience.
Diversification
Diversification includes diversifying into restaurant business. As Orion food industry is

engaged in convenience foods and due to increased consumer perception, it is easy for them
to diversify into a fast food restaurant business. But the feasibility study and financial
position must be evaluated before entering in to such a business.
Market Development
FIGURE 4.4.3
(Focus Management, 2012)
ORION FOOD INDUSTRY
Market development includes targeting the new markets with the current products. From the
case analysis it is understood that the next target market of Orion is the UK market. But
entering the UK market needs sophisticated planning because there are a large number of
competitors. The demand for Orion foods in UK and the target market should be analysed.
The detail analysis of the UK food Industry and the entry mode is done in the following
chapters.
ORION FOOD INDUSTRY
4.5 PORTER’S DIAMOND MODEL FOR ORION FOOD INDUSTRY, MALAYSIA
FIGURE4.6 FACTOR CONDITIONS
+ Efficient economy with liberal

Trade and exchange policies.
+ Political and macroeconomic
Stability.
- Corruption
- Government Inefficiency
DEMAND CONDITIONS
FACTOR CONDITIONS +Procurement of advanced
technologies by the government.
+Quality port and airport
infrastructure (Automated ports).
+Advantageous location at +Access to China, Introduce

crossroads of major sea routes. ORION ADVANTAGES
AFTA
+Availability of savings and AND DEMERITS - Small domestic market.

Credit. - Low buyer sophistication.
- Labour shortages.
mcdnmcdkm
- Low literacy levels.
RELATED AND SUPPORTING
INDUSTRIES
+Introduction of different clusters
by government.
+5th largest exporter of ICT
products.
+Major exporter of oil and gas,
palm oil, rubber and other natural
resources.
(Harvard Business School, 2008)
ORION FOOD INDUSTRY
The above points are briefly discussed below:
Factor Conditions
The factor conditions play a vital role in the attractiveness and competitiveness of the
industry. Malaysia is blessed with abundant natural resources as well as with its location. It
connects major sea routes leading to Far East to South Asia, Middle East and Europe. The
country’s natural resources as well as climate are suitable for the production of crops and
other agricultural products. Malaysia has got well structured infrastructure and wide
transportation networks. But the country has got some labour shortages and literacy levels of
people. The advantages can be exploited by Orion Food Industry in the home markets and to
become competitive.
The following tables show the business competitiveness ranking of Malaysia in various fields
in comparison with 55 countries.
FIGURE 4.6.1
STRENGHS RANKING WEAKNESS RANKING
 Ease of access to loans. 14  Financial market

 Port infrastructure. 12 sophistication. 26
 Quality of education. 12  Corruption. 30
 Control over international  Property rights. 51
distribution. 13  Patents per capita 28
ORION FOOD INDUSTRY
Related and Supporting industries
The Government of Malaysia has recently has promoted regional economic corridors as well
as some high valued clusters. Malaysia is now the 5th largest exporter of semiconductor goods
and other ICT products. The country is also a major exporter of oil, natural gas and palm oil.
These supporting industries has created a competitive strive for Orion to compete worldwide.
FIGURE 4.5.2
EXPORT OF DIFFERENT CLUSTERS

9
8
7
6
5
4
3
2
1 EXPORT OF DIFFERENT
CLUSTERS
0
Demand Conditions
The dynamic population of Malaysia is increasing which is a potential market for food
industry. Also the government has procured some automated technologies for import as well
as export. There is also some loosening of the government regulations which has improved
the demand locally and abroad.
Context for firms Strategy and Rivalry
Malaysia’s economy is open with flexible foreign trade and exchange policy. Over the years
they possess political as well as macroeconomic stability. The country’s environment is very
ORION FOOD INDUSTRY
dynamic for business. But on the other hand the country’s context has also got some
disadvantages like corruption and government inefficiency. In terms of rivalry Orion has got
limited local competitors in the convenience food industry. (Harvard Business School, 2008)
4.6 PEST ANALYSIS OF ORION FOOD INDUSTRY
POLITICAL FACTORS
Orion food industry should consider certain political factors while operating in their home
country. The government of Malaysia is keeping a good control over the convenience and
other fast food business because of the health problems of the people of Malaysia. Orion
should maintain a good relationship with the government to get some tax benefits and
employment benefits. Malaysia has also got certain strict labour laws such as minimum
wages act, deduction of wages, annual leave and so on. (Labour Law, 2012) which the Orion
should take into consideration.
ECONOMIC FACTORS
As a business entity Orion should consider the various regulations of the government and
other economic factors such as interest rates, inflation and money supply of the country. They
ORION FOOD INDUSTRY
should consider the economic growth of the country because if the economy is dull the
demand of their products tend to fall and if the economy is booming more people will have
the money to spend on convenience and other fast foods and the disposable income of the
country increases which increases the demand of their products. The Malaysian economy is
now growing rapidly with 6% GDP. The inflation rate is 2%. There is minimum increase in
the price of food products. In terms of trade policy Malaysia has low trade tariffs and also the
country is the founder of AFTA.
FIGURE 4.6.1
(Harvard Business School, 2008)
(Monetory and Financial Conditions, 2010)
ORION FOOD INDUSTRY
SOCIAL FACTORS
The changing lifestyles of the people in Malaysia due to the growing economy have a great
impact on the consumption pattern in the food industry. Most of the people demand high
quality and hygienic foods and also the family structure plays an important role in
consumption habits of the people. The level of education in the country is increasing and also
the distribution of income. Orion should consider all these social factors in their operations.
Following table shows the number of people Purchased food from outside in Malaysia
according to age, ethnicity, gender, education, income and location.
TABLE 4.6
PURCHASE DID NOT TOTAL

PURCHASE
AGE 1939(74%) 665(26%) 2604(28%)
16-35
36-56 3491(75%) 1137(25%) 4628(50%)
>57 1178(60%) 774(40%) 1952(21%)
ETHINICITY 3232(71%) 1348(29%) 4580(50%)
Malay
Chinese 2337(89%) 298(11%) 2635(29%)
Indian 1039(53%) 930(47%) 1969(21%)
EDUCATION
LEVEL
498(45%) 603(55%) 1101(12%)
No education
Primary 2053(65%) 1087(35%) 3140(34%)
Secondary 3257(80%) 826(20%) 4083(44%)
Tertiary 800(93%) 60(7%) 860(10%)
GENDER
Male 5615(73%) 2040(27%) 7655(83%)
Female 993(65%) 536(35%) 1529(17%)
HOUSEHOLD SIZE
1 Person
757(73%) 280(27%) 1037(11%)
2 Person 680(63%) 408(37%) 1088(12%)
3-7 Person 4562(73%) 1646(27%) 6208(68%)
ORION FOOD INDUSTRY
>8 Person 609(72%) 242(28%) 851(9%)
HOUSEHOLD
INCOME
<RM 1500 2070(51%) 1976(49%) 4046(44%)
RM 1501 – 7999 4290(88%) 595(12%) 4885(53%)
>RM 8000 248(98%) 5(2%) 253(3%)
LOCATION
Urban 4289(82%) 937(18%) 5226(57%)
Rural 2319(59%) 1639(41%) 3958(43%)
TOTAL 6608(72%) 2576(28%) 9184(100%)

(Heng, 2007)
TECHNOLOGICAL FACTORS
Technology is a vital factor that should be considered in the macro environmental analysis of
the company. Malaysia’s main export is ICT products and it has automated ports which
reduces the time taken for imports and exports. Orion should exploit this available technology
to their advantage. Also they should implement and upgrade technology to have competitive
advantage and also to create value products. Use of high end technology can reduce costs and
increase profits so that the company can engage in more discounts and promotions to attract
new customers.
ORION FOOD INDUSTRY
4.7 ANALYSYS AND FEASIBILITY OF THE TARGET MARKET- UK
Targeting a country to enter is a difficult task for any company. A detailed analysis of the
U.K market is to be conducted for the foreign expansion of Orion food industry in terms of
how to enter and on what scale. Orion has exported its products to many countries like
Singapore, Middle East and so on but has not touched the Europe till now. The next target
market for Orion is U.K which shows high demand and opportunities for their products.
OPPORTUNITIES
FOOD AND DRINK INDUSTRY- U.K LARGEST INDUSTRY
The food and drink industry is the biggest manufacturing industry in the country with around
21.5 billion Gross Value Added (GVA) and working by around 47000 people. The food and
drink industry performs well in U.K which produces higher than other manufacturing sectors
and which attracts large number of customers in the economy.
The expenditure pattern of customers on convenience food products which

includes the pre packaged meals increases over the years. The intensity of growth of the food
companies in the future is very high in U.K.
FIGURE 4.7
Gross Value Added by different

manufacturing sectors in U.K
Food and Drink

Paper and Pulp
Transport Equipment
Electrical and Optical
Chemical
Basic Metals
Machinery and Equipment
Rubber and Plastic
Others
(Food and Drink Federation, 2008)
ORION FOOD INDUSTRY
Emerging Trends in the U.K food Industry
Focus is more on health factors and all the food companies whether local or international
must follow the new European Union Nutrition and Health Claims Regulation. Also there
is control by the government on advertisements on food products.
There is continuous demand for convenience foods by the working population of the
country.
The price of agricultural and other raw materials is increasing.
The number of people who are visiting super markets and other retail outlets is increasing
over the years.
The public is more concerned about environmental issues which are caused by packaging
waste, production and distribution of the food products.
ORION FOOD INDUSTRY
SWOT ANALYSIS OF U.K FOOD INDUSTRY
TABLE 4.7
Strengths Weakness
Superior standard with regard to Lack of trust from the public.
food, its quality, safety and Lack of support from the
Sustainability. government.
Efficient transportation and Shortage in the availability of
distribution (logistics). skilled labour.
Advantages in terms of
technology.
Opportunities Threats
Growing demand for convenience and Lack of stability and over regulation
Other premium food products. by the government.
Growth in the catering market. High bargaining power of food
Retailers.
Technological sophistication in
Various fields such as products, High competition from all parts of the Process
and customer relations. World.
(Food and Drink Federation, 2008)
ORION FOOD INDUSTRY
THREATS TO ORION FOOD INDUSTRY IN U.K
EUROPE CRISIS
The crisis in Europe is a major challenge for Orion Food Industry. They should carefully
analyse the various dimensions of Europe crisis and how it affects U.K in order to have a
sustainable growth in the country. Some of the factors that can affect Orion are:
 Government Debts
The government debts are increasing in a higher rate which accounts for 10.49 trillion. This is
a major threat for Orion because if this continues the tax rates and employment regulations
will undergo changes over the years. The huge debts can hinder the economic progress of the
country. This can also the increase the interest rates of the country. The following figure
shows the various debts of different countries in Europe including U.K.
FIGURE 4.7.1
(Morss, 2010)
ORION FOOD INDUSTRY
 Continuing Recession
U.K is undergoing some kind of recession over the years. This had a great impact on the life
of people and also weakens the economic situation of the country. In 2009 the situation had
slightly improved but recent data shows that the country has fallen to recession again. This
can adversely affect the business and companies operating in U.K. The following figure
shows the fall in GDP of U.K in the last quarter of 2011.
FIGURE 4.7.2
U.K GDP GROWTH
(BBC, 2012)
COMPETITION
There is an intensive and stiff competition in the convenience food industry of U.K. There are
a lot of players in the market which competes with Orion in the future. Some of the
competitors are Lembas U.K, Kepak and so on. These firms are well established and had
experience of identifying the U.K market potential and changing customer tastes and
ORION FOOD INDUSTRY
preference. Orion might undergo some entrance costs set by other established players in the
industry. They should adopt suitable international entry strategy to overcome these
competitions. (Website Informer, 2010)
4.8 KEY FINDINGS
Various findings were obtained from the secondary sources and by distributing questionnaire.
The limitation occurred while collecting data was the time constraint of people to fill the
questionnaire. From the data collection following findings were obtained.
i.A large number of people prefer Orion Foods to buy due to their busy schedule.
FIGURE 4.8.1
NUMBER OF PEOPLE WHO ARE PREFERING TO

BUY ORION FOODS
NOT INTERESTED
ONCE IN A MONTH NUMBER OF PEOPLE
WHO ARE
ONCE IN A WEEK PREFERING TO BUY
ALWAYS ORION FOODS
0 20 40 60
ii.Another findings obtained during the data collection is that most of the people like Orion
foods if they add healthier menus and low fat ingredients. The following chart helps to
summarize the finding:
FIGURE 4.8.2
PREFER TO BUY ORION MEALS IF ADDED MORE

HEALTHIER MENUS AND CONTAINS LOW FAT
DO NOT BUY
LIKE TO BUY ORION
NOT SURE MEALS IF ADDED
PROBABLY MORE HEALTHIER
MENUS AND
DEFINITELY
CONTAINS LOW FAT
0 10 20 30 40 50
ORION FOOD INDUSTRY
iii.The other finding drawn is that most of people believe that Orion foods need more
promotion and marketing strategies to reach more people and markets.
FIGURE 4.8.3
NUMBER OF PEOPLE SUGGESTING PROMOTION AND

MARKETING TO ORION FOODS TO INCREASE BRAND
AWARENESS
NUMBER OF PEOPLE
DO NOT RECOMMEND
SUGESSTING MARKETING
STRONGLY RECOMMEND AND PROMOTION TO ORION
FOODS TO INCREASE BRAND
0 10 20 30 40 50 60 AWARENESS
iv.From various secondary analysis and other data collection it is found that it is the right
time for Orion to enter U.K market and also Orion food possess a high market potential in
U.K because of high demand for pre packaged meals in all parts of Europe.
v. From the study it is found that with proper marketing, planning and implementing changes
in the business Orion can achieve its sustainable future growth in 3 years and accomplish
their vision to be listed in the Malaysian Stock Exchange.
ORION FOOD INDUSTRY
CHAPTER- 5
PROPOSED PLAN OF ACTION
5.1 INDUSTRY ANALYSIS
MALAYSIAN FOOD INDUSTRY
The standard of living of people in Malaysia has increased tremendously over the years. The
per capita income of the country rises over RM 19739 or US$ 5681. Due to this, the lifestyle
of people has changed and they depend largely on convenience food and health food. The
country’s food industry is blessed with tropical and other agricultural resources which depicts
the culture of Malaysia’s ethnic group. The demand for processed fresh foods, healthy foods
and natural food flavours in the country has been increased tremendously.
SUB SECTIONS OF FOOD AND BEVERAGE INDUSTRY
Various subsections of food and beverage industry prevail in the country. The first subsector
includes the fisheries subsector which consists of frozen and canned fish, shrimp and so on.
The livestock subsector consists of poultry meat which covers whole of Asia Pacific. In the
area of Diary products some of the products are milk powder, condensed milk, and yogurt.
The fruit products include mangos, papaya and so on. Production of fruits and vegetables
reaches 256 million tonnes in 2009 and 1.13 million in 2010. According to the recent
statistics Malaysia is the No.1 producer of cocoa in Asia and stand 5th in the world. The
country is also in the list of major producers of spices in the world. (Micheal, 2011)
ORION FOOD INDUSTRY
TABLE 5.1
TYPE 2009 2010 GROWTH

Baby Food 1218.3 1316 8.02%
Bakery 2406.5 2463.3 2.36%
Canned/Preserved 902.5 931.2 3.18%
Food
Chilled Preserved 250.3 259.1 3.52%
Food
Confectionery 894.3 917.5 2.51%
Diary 2891.4 3006.2 3.97%
Dried Processed 2794.1 2991.7 7.07%
Food
Frozen Processed 474.1 491.5 3.67%
Food
Ice cream 534.8 548.6 2.58%
Meal Replacement 130.8 142 8.48%
Noodles 939.9 1044 11.08%
Oils and Fats 2223.5 2281.6 2.61%
Pasta 11.2 12.6 12.50%
Ready Meals 101 105 3.96%
Sauces, Dressings 1158.4 1192.1 2.98%
and Condiments
Snack Bars 7.2 7.7 6.99%
Soup 49.2 51.8 5.28%
Spreads 129.7 134.7 3.86%
Sweet and Savoury 603.7 623.2 3.23%
snacks
Impuls and 3592.3 3688.6 2.68%
Indulgence Products
Nutrition/Staples 10256 10759.3 4.91%

Meal Solution 2836.5 2928.6 3.25%
Packaged Food 16666.3 17357.2 4.15%
(Micheal, 2011)
HALAL INDUSTRY
The Halal industry is one of the most attractive factors of Malaysian food industry which
provides immense opportunities to the Malaysians food manufacturers. The Halal has a value
which is expected to be USD 547 billion a year.
ORION FOOD INDUSTRY
INCREASING DEMAND FOR CONVINIENCE FOODS
Over the years the demand for Convenience foods has increased. The lifestyle and trends of
the people of Malaysia has witnessed a change and the working population increases. The
time for cooking at home has considerably reduced over the years. The study conducted by
Datamonitor shows that 44% of the people on a global basis feels to eat out or depend on
convenience foods. The following figure shows some of the key drivers for convenience
foods:
FIGURE 5.1
(Agri Food Trade Service, 2010)
ORION FOOD INDUSTRY
5.2 COMPANY HISTORY
Orion Foods are made by Orion Food Industries Malaysia which is under the subsidiary of
Port west Group of Companies. Port west Group of Companies is an internationally expanded
conglomerate. The company was started in the year 1993 targeting the local market which
possesses very high demand for convenience foods. The Orion foods in the past and even
today consist of Asian cuisine. Even though they consists of authentic Asian cuisine there
seems to be some differences in the package and features than the normal food. They are in
the form of pre packaged meals which does not contain any adulteration. The preparation of
this meal takes only less than 3 minutes and it is ready for serving. The food is exported to
different countries which has good consumer perception and adoption of Orion foods.
RETORT POUCH FOOD
All Orion foods uses retort pouch packaging which differentiate them other packaged foods.
All retort pouch food contains stretchable coated food package which can overcome any
thermal processing. The merit of this type of packaging is that it can offer same shelf space
stability which is offered by other metal cans. All Orion foods use this type of technical
packaging as it is a feasible option for other metal cans and jars and also consumers globally
prefer these type of packaging as it is convenient for them. The idea behind using this type of
packaging by Orion Food Company is that it is light weight, shelf stable and easy food
containers comparable to the traditional cans. The following figure shows the outline
structure of retort pouch packaging. (Flair Packaging, 2012)
ORION FOOD INDUSTRY
KEY FINANCIAL DATA
TABLE 5.2.1- SHOWING THE SALES REVENUE AND FORECASTED SALES OF

ORION IN DIFFERENT COUNTRIES
SALES REVENUE – US DOLLARS (IN MILLIONS) FORECASTED YEARS
COUNTRY YEAR1 YEAR2 YEAR3 YEAR4 YEAR5 YEAR1 YEAR2 YEAR3

MALAYSIA 0.8 1.1 1.4 1.6 3.0 4.0 5.0 5.5
SINGAPORE 0.2 0.4 0.5 0.5 0.5
AUSTRALIA 0.3 0.6 0.6 0.7 0.7 0.7 0.7

JAPAN 0.1 0.1 0.6 1.0 1.5 1.8 1.3 1.1
MIDDLEEAST 0.1 0.5 0.8 0.9 1.0 1.5
USA 0.1 0.3 0.6 0.8 1.0 1.2

EUROPE 0.2 0.5 1.0
(FORECAST)
TOTALS 0.9 1.5 2.8 4.2 7.0 8.9 10.0 11.5
TABLE 5.2.2 FINANCIAL PERFORMANCE INDICATORS- RATIO ANALYSIS
YEAR1 YEAR2 YEAR3 YEAR3 YEAR4 YEAR1 YEAR2
Stock 6 6 8 8 7 8 9
Turnover(Times)
Debtors 109 120 128 120 140 120 110
Collection Period
Current 2.3:1 1.9:1 1.6:1 2:1 1.5:1 1.8:1 2:1
Ratio(CA-CL)
Number of 5 6 7 5 6 5 4
months in
overdraft(negative
cash flow)
Net profit to sales 3 6 15 22 27 28 30
ratio(EBIT)
ORION FOOD INDUSTRY
5.3 Market Analysis
The following analysis of the market will help the Orion in the future sustainable growth.
Malaysia has a large number of fast food restaurants and other convenience stores. The
convenience business selling ready packaged meals is limited in the country. Also Orion has
variety of menus and dishes which is not offered by other convenience foods in Malaysia.
There are approximately 65 well recognised food chain brands in Malaysia which overall has
more than 2600 outlets in the country. The following table shows the number of fast food
chain brands, the direct and indirect competitors of Orion in Malaysia. This provides them a
clear idea about the competitive positioning and market share.
TABLE 5.3
ORION FOOD INDUSTRY
ORION FOOD INDUSTRY
ORION FOOD INDUSTRY
ORION FOOD INDUSTRY
ORION FOOD INDUSTRY
ORION FOOD INDUSTRY
(Bursa Malaysia, 2011)
ORION FOOD INDUSTRY
Population
The population of Malaysia shows a stable growth with 25.5 million in the year 2004. The
capital city KL has 1.5 million and has a density of 6173 persons per square metre. The
forecasts show that the population will reach 28.96 million in the year 2020 with a growth of
1.6% per year.
Consumer Spending
The rate of consumer spending on food products in the country gives a clear picture to Orion
about the demand of their food products in the future. The people of Malaysia spent a highest
percentage of their income on convenience and fast foods. Malaysia spends on an average of
MYR 505 P.M on food and groceries. Major proportion of it consists of meals, fresh meat
and fruits. The following chart shows the spending patterns of people of Malaysia on various
patterns.
FIGURE 5.3.
CONSUMER SPENDING PATTERNS

9
8
7
6
5
4
3
2
1 CONSUMER SPENDING
0 PATTERNS
ORION FOOD INDUSTRY
Life style / Shopping Habits
Orion should understand the changing lifestyle and shopping habits of the people of the
country. The lifestyle of people undergoes some kind of changes over the years due to high
education levels. The entrance of local and high profile international retailers made the
people of rural and urban areas to shop from various hypermarkets like Tesco, Carrefour and
Giant. The number of people who is purchasing from super markets and hypermarkets has
increased. These factors need to be taken into consideration by Orion because they can place
more of their products in supermarkets and hyper markets in the future.
5.3.1 Market Segmentation
Orion Food Industry should focus on certain categories of people in order to diversify into the
market. The primary aim should be focussing on budget customers, family oriented as well as
working men and women. They should focus on these classes of people because of lifestyle
patterns and food habits. This category of people can be targeted by Orion in order to sustain
their growth in the future.
FIGURE 5.3.1
Market Segmentation
WORKING FAMILY
ORIENTED
POPULATION
BUDGET CUSTOMERS
ORION FOOD INDUSTRY
5.3.2 Market Size
The food service market in Malaysia is expected to be RM 18B to 20 B. This is the figure in
2008. The research also reveals that the food market will grow from 10% to 15% in the next
5 years. The value that is expected to be derived from the food market is 19.8 billion to 23
billion. The market size and growth for Orion is large and it shows a positive growth in the
future. (Bursa Malaysia, 2011)
5.3.3 Market Needs
Orion should keep in mind the various markets need emerging in the industry. Recent study
shows the following needs of the market:
 Most of the people need more spicy food. Also the number of people taking meals in
a day has increased to twice or trice in a day. This is an advantage for Orion.
 The demand for prepared and packaged foods is increasing.
 The needs more vegetables with the meals have increased over the years because of
health concern.
 The ethnic groups in the country demand more food according to their culture, taste
and preference.
 Most of the people practices or adopts a global lifestyle, especially the younger
generations. (Agri Food Trade Service, 2011)
5.3.4 Market Trends and demand
Growing Middle Class
The middle class population in the country is growing rapidly. This creates a strong demand
for the food industry. The growing middle class in the country posses more spending power
compared to the past. The trend towards western type of food has also increased.
Healthier life style trends
The trend towards healthier food style has also increased. More food companies in the
country are focussing upon fat free products and healthier menus. This trend towards food is
increasing because most of the increasing health concerns among the Malaysians.
ORION FOOD INDUSTRY
Tourism
The tourism in the country has also increased rapidly over the years. Due to this the
government is promoting Malaysian food as well. The number of tourists visiting and
working in the country is also increasing. Orion should also target these emerging tourists in
the country. (Bursa Malaysia, 2011)
5.4 Products
Orion is known for healthy ready pre packaged meals which helps large number of customers
who have no time to cook at food at home or undergoes a busy schedule. They serve there
foods in convenience packages known as retort pouch packaging which provides more
storage life to food products.
5.4.1 Product Description
Orion serves a variety of product mixes to satisfy various markets both at home and overseas.
Their products range features authentic Asian food which is liked and rewarded by many
customers all over the world. Orion serves a variety of product mixes to satisfy both home
and overseas markets. Some of their product mix includes:
 Chicken Curry
 Mutton Korma
 Beef Korma
 Squid Curry
 Sweet and Sour Chicken
ORION FOOD INDUSTRY
 Sweet and Sour Prawns

 Asian food Sauces
The product range of Orion includes:
 Traditional Malay or Indian cuisine

 Chinese Food
 Italian Dishes
.5.4.2 Future Products and Services
Currently Orion should focus on building their brand and increasing their sales. But as they
grow they can add some product mixes and menus to target more customers. Some of the
menus they can include are:
Including Western Food
Malaysia is now witnessing a shift towards western culture and western food particularly the
youngsters. Many international food companies and local companies are now selling western
foods and there demand still continuous. Orion can include some western dishes in the future
to further expand their business. (Corporate Functions, 2012)
Soft Drinks
Orion can enter into the business of soft drinks which they can sell along with their meals.
Soft drinks possess a good market for Malaysia. But the feasibility, market and the
competitors need to be analysed.
ORION FOOD INDUSTRY
5.5 Customer Analysis
FIGURE 5.5
(Dh, 2008)
Analysing the target customers is a vital part for any industry. Orion need to carefully analyse
it target customers, their needs and ways to retain them and also implement strategies for the
potential customers in the future. The customer analysis of Orion can be done by keeping in
mind the following factors:
FIGURE 5.5.1
CUSTOMER ANALYSIS
CURRENT/POTENTIAL
CUSTOMERS
CUSTOMER NEEDS CUSTOMER CHANNELS MARKET RESEARCH
ORION FOOD INDUSTRY
 Customer needs: Convenience foods and packaged food customers are looking for
low price, high quality foods which provides long shelf space compared to other food
products. They also demand food with low fat and which includes healthy menu that
can be cooked within a limited time. The various needs of customers, their tastes and
preference should be carefully analysed by Orion.
 Current or Potential Customers: The current or potential customers of Orion are
working population, budget customers and time conscious public. Orion Food
Industry should also target the youngsters because they mostly prefer to buy food
from outside. They should include menu which can attract youth. Also Orion should
build a strong relationship with retailers and supermarkets in order to promote their
products.
 Customer Channels: The different channels that can be used to reach customers are
DISTRIBUTORS, SUPERMARKETS, RETAILERS AND WEBSITES.
 Market Research: Orion should conduct a wide and efficient market research in order
to attract more customers. They should target people with age group between 20- 40
because these are the people who is time conscious, price sensitive and who prefer to
eat outside food. They should also target premium customers who buys product
because of quality and taste. (Thorn, 2009)
ORION FOOD INDUSTRY
5.6 VALUE CHAIN ANALYSIS
ORION FOOD INDUSTRY
MARKETING AND SALES OPERATIONS SERVICE
STRENGHTS STRENGHTS STRENGTHS

 Product  High processing and  Website services.
Customization storage facilities.  Storage Capacity.
 Availability of different menus.
WEAKNESS
WEAKNESS WEAKNESS
 Lack of promotion.
 Lack of flexibility in  Lack of customer service and
 Lack of marketing
relation to foreign feedback
expert.
customer demand.
 Lack of integration.
INBOUND LOGISTICS OUTBOUND LOGISTICS
STRENGTHS STRENGHTS
 Efficient warehouse  Quick delivery of products including air
management. transport.
 Supply Chain Control  Outsource transportation to leading
companies.
WEAKNESS  Larger geographical coverage
 Lack of storage facilities for WEAKNESS
future expansion.  Lack of resources in meeting future
expansion
(Johnson et al., 2008)
ORION FOOD INDUSTRY
5.7 Stakeholder Analysis
FIGURE 5.7
WHOLESALERS, RETAILERS, EMPLOYEES
DISTRIBUTORS
BUSINESS
ORION
SUPPLIERS
CUSTOMERS
Stakeholder analysis involves the systematic analysis and collection of useful information to
evaluate whose interest should be taken into consideration while developing and
implementing new ideas to the business. Orion should use stakeholder analysis to identify the
key stakeholders who can influence the business and who can and to evaluate the interests,
roles, alliances and importance given by them to the business. (Nayab, 2011)
The various stakeholder analysis of Orion can be done in the following ways:
Customers
Customer Interest
 Receiving quality products without any preservatives for the money spent.
 Receiving convenience foods which is healthy and which provides high storage
capacity.
Customer Power
 Switching to substitute products by competitors.

 Avoiding unhealthy and unreliable food.
ORION FOOD INDUSTRY
Orion food industry customer loyalty can be improved through:
 Providing Quality food.

 Efficient packaging and storage.
 Efficient customer service.
Suppliers
Supplier Interest
 Receiving continuous order on raw materials like meat and vegetables.

 Quick Payment.
Supplier Power
 Switching to competitors.
 Discontinue relationship with industries whose payment policy is unreliable and
unsatisfied.
Orion food industry supplier loyalty can be improved by:
 Timely and efficient payment.

 Practicing fair rate policy.
Employees
Employee Interest
 Receiving adequate salary.

 Maintaining Stable environment.
 Providing bonus, competition and other benefits.
Employee Power
 High turnover.
 Instability of competent staff.
 Bargaining Power.
ORION FOOD INDUSTRY
Orion food industry employee loyalty can be improved through:
 Providing fair wage to employees.

 Providing training.
 Insisting career growth.
Wholesalers, retailers and distributors
Wholesaler, retailer, distributor interest
 Receiving Incentives for adequate promotion.

 Maintaining strong relationship for the future.
Wholesaler, retailer, distributor power
 Less promotion of products due to lack of incentives.

 Refusal of products which shows less demand in the market.
Orion Food Industry Wholesaler, retailer, distributor loyalty can be improved by:
 Providing adequate incentives for promotion.

 Providing fair wage to distributors. (Nayab, 2011)
ORION FOOD INDUSTRY
5.8 VISION
To list the company on the Malaysian Stock Exchange and use the profits to expand in order
to control the supply chain and thus will be more profitable in the long run.
5.9 BUSINESS OBJECTIVE
 To offer quality and well packaged meals.

 To provide healthy meals to customers.
 To become established in the field of convenience foods industry.
5.10 FINANCIAL OBJECIVE
 To increase the sales by 11.5 Million dollars by the year 2015.

 To maintain a strong cash flow by achieving projected cash flow balances.
 To analyse the net profit of the business after 3 years.
5.11 COMPETITIVE POSITIONING
Orion Food Industry can achieve substantial profits from its competitors either in two ways:
by providing their products at a lower cost or by differentiation. Orion achieves its
competitive advantage by product differentiation and packaging. They total sales for the
current year was 7 million U.S Dollars. Their products have been in the markets for more
than 19 years. Orion sustains its competitive advantage by new ideas, new products and new
taste experiences for the customers. For example, Orion provides variety of menus to cater
different ethnic groups in the country which is not provided by any other convenience food
companies. They constantly review market trends to adapt the taste of different customers.
They study cultural differences in the food habits of different people in the country and
position their products.
ORION FOOD INDUSTRY
5.11 STRATEGIES FOR SUSTAINABILITY
Orion Food Industry should implement various strategies in order to have a sustainable
growth in the future. These provides them concrete base for the future expansion and
sustainability in the Malaysian Food Industry.
Marketing Strategy
Orion foods are now exported to many countries. They need to focus on the perception of
their products in different countries through effective marketing research. Also research
should be conducted in order to know the impact of advertisements on people buying rate and
through which media they can position their product that is, through print or television
advertisement. Here the cost factor should be considered. Another marketing strategy which
can be adopted is conducting an international consumer survey in different exporting
countries and targeted countries in order to understand the quality perception as well as the
awareness of the product so that modifications can be done accordingly. More satisfied
customers are one of the most important marketing tools which Orion can use because word
of mouth spreads faster than any other media. Some other strategies which can be used by
Orion is direct mail advertisement, free samples, home delivery, FM advertising, special
menus and so on. (Magwood, 2011)
Promotion Strategy
Food industry today use different promotion techniques and it will be very difficult for Orion
Food industry to gain customer attention because of intense rivalry. But certain unique
promotion strategies can be used by Orion to attract target customers, they are;
ORION FOOD INDUSTRY
FIGURE 5.12
PROMOTIONS
SPECIAL
EXTRA
MENUS
QUANTITY REGULAR
DURING
WITH SAME SPECIALS
FESTIVE
PRICE
SEASONS
Pricing Strategy
Current Pricing strategy of Orion is Simple Cost Plus model pricing. But this method of
pricing cannot withstand longer due to emerging competitors. In future some of the strategies
Orion should use are:
 Best Pricing: Best pricing is one of the pricing strategies which can be used by Orion.
It includes offering three similar menus of different prices. The health conscious
consumer will choose only the product which derives value and which is safe for
health instead of price.
 Positioning Pricing: This strategy includes setting the setting low price to position
Orion foods in the mind of customers and to avoid competition.
Product Strategy
Orion should use its products to position themselves in the mind of customers. They should
establish their products to target customers, analyse which group really likes Orion foods.
They should also convey the special features of their product to the target customers such as
packaging, easy to cook, zero preservatives and so on.
Placing Strategy
Placing the products to the final consumers is very important for Orion Food Industry. Proper
distribution channels should be identified and selected to ensure availability and quick
delivery of products. Orion should place their products like supermarkets where the customer
traffic is high. (Kotler & Keller, 2009)
ORION FOOD INDUSTRY
Sales Strategy
The most important sales strategy which can be used by Orion Food Industry is to develop
repeat business. Orion should keep accurate track of the food items that has more sales and
also collect feedback from customers through feedback forms which can be distributed in
retailer shops and supermarkets.
Sales Forecast
High forecasted sales is in the month of July to September which is fasting month in
Malaysia. During this most people buy something which is easy to cook and prepare. And
also during this period non Muslims has more free time because of less working hours. The
following figure shows the sales forecast of Orion in 12 months period.
FIGURE 5.11.7
Sales Forecast Monthly for the first

forecasted year
10
8
6
4
2 Sales Forecast Monthly
0 for the first forecasted
July
August
October
November
April
March
May
September
June
January
December
Febraury
year
BREAKEVEN ANALYSIS OF THE FORECATED FIRST YEAR
FIXED COSTS 1600000
VARIABLE COST(PER UNIT) 10
SELLING PRICE (PER UNIT) 15
TIME PERIOD YEARLY
ORION FOOD INDUSTRY
5.13 CRITICAL SUCCESS FACTORS
RESEARCH AND EXTENSIVE WIDE RANGE
DEVELOPMENT DISTRIBUTION OF PRODUCTS
FACILITIES
CAPABLE WORK FORCE INNOVATION
ORION FOOD INDUSTRY
Research and Development
Orion Food Industry was able to capture the specific needs of different ethnic groups of
Malaysia due to their efficient R&D department. They position their food products according
to the changing demographics and competition both in home and overseas market. They
create demand for their products through investment in R&D, employee welfare and efficient
supply chain.
Extensive Distribution Facilities
Orion possesses extensive distribution facilities with their products placed in major
supermarkets and retail shops of the country. They were also able to distribute their products
to other countries other than Malaysia.
Wide Range of Menu
Orion Food Industries engage in selling pre packaged meals which includes a variety of
menus that satisfies the different ethnic groups of the country. The plan their menu according
to the changing market trends and cultures of different countries.
Capable Workforce
The workforces of Orion Food Industry possess adequate talent and experience. The
management was successful in maintaining strong relationship with employees and motivate
them efficient pay and reward schemes above the industry standards.
Innovation
Innovation is the key success for Orion Food Industries. They were able to use technical
packaging known as Retort Pouch Packaging which differentiates them from other local food
products. This type of innovation in their process helps to gain market share in Malaysia in
pre packaged meals.
ORION FOOD INDUSTRY
5.14 SMART OBEJECTIVES
Specific
The specific objective of Orion Food Industry will be to increase its market share by 5% in
the next three years to have a sustainable growth in the future. The specific objective of Orion
must be clear and accurate and it must be communicated to all staffs to understand the
importance of the objective. All the staffs must reduce the cost incurred in all activities so
that the profit of the business increases.
Measurable
Orion should put some measurable value to their objectives. The sales target of the industry
would be $ 11.5 Million in the next three years which includes both home and overseas
market. This can be achieved through improving the quality of food products as well as
adding variety of menu. The following table shows the sales forecast of Orion Food Industry
in the next three years:
FIGURE 5.14
SALES FORECAST YEARLY(US

DOLLARS)MILLIONS
14
12
10
8
SALES FORECAST YEARLY(US
6 DOLLARS)MILLIONS
4
2
0
YEAR1 YEAR2 YEAR3
Achievable
The target set should be achieved in the time set and also in the interest of the stakeholders. It
will be difficult for Orion Food Industry to be a market leader in U.K within a limited time
because there are a lot of established food chains in U.K selling the same products of Orion.
The objective set should be achievable so that the employees are motivated.
ORION FOOD INDUSTRY
Realistic
Orion should ensure that whether the objectives are realistic by possessing competent
resources and talents. The business is commenced from 1993 and it has gained consumer
perception over the years. The following table shows the resource competency of Orion:
RESOURCE AREAS FOR

COMPETANCY IMPROVEMENT
ICT
RETORT POUCH INFRASTRUCTURE
PACKAGING
DISTRIBUTION MARKETING
SYSTEM
MANAGEMENT BUDGETORY
EFFICIENCY PLAN
Time Bound
Setting time for the target is the most important objective of Orion Food Industry. Orion
should accomplish their task within three years in order to have a sustainable growth. They
are well positioned in Malaysia. They have to increase their market share in abroad countries
particularly U.K with the help of proper analysis and entry mode. Targeting the U.K market
and positioning their product in Europe will increase their turnover and sustainability in the
next three years.
ORION FOOD INDUSTRY
5.15 CHANGE MANAGEMENT PLAN AND IMPLEMENTATION PLAN
A change Management Plan is used in order to identify and evaluate the alternatives done to
existing business plan or approach. The Change Management Plan prepared will help Orion
Food Industry to modify its overall operations and strategies.
Purpose
The purpose of Change Management Plan in Orion Food Industry is to improve overall
efficiency and implement changes in all departments. The current management plans and
strategies will not help them for future sustainable growth as the business is expanding to
abroad markets. Change is required to gain competitive advantage and efficiency in overall
business structure.
Industry Stakeholders
The various stakeholders who are affected by the change management include management
staff and lower level workers, distributors, retailers and final consumers.
ORION FOOD INDUSTRY
Scope and Implementation
Changes and modifications are required in all parts of Orion to support future expansion of
business. Proper planning and identifying the changes is an important goal. The change
should be implemented in accordance with the interest of all the staff and also taking in to
consideration the cost incurred. The following changes can be done in the following
departments:
MANAGEMENT
FIGURE 5.15
(Change Management, 2012)
ORION FOOD INDUSTRY
Efficient management communication, leadership and motivation will boost the employee
morale towards corporate goals. Each employee should be communicated about the
department goals and company vision. The senior management of Orion should build
informal relationships with employees by walking around and obtaining feedback from them.
Currently Orion is lacking employees in senior management. They are in need of a general
manger to control in absence of the Director. Each employee should follow their work roles
and accomplish them in the specified time. The following figure shows the performance of
Orion management in different aspects regarding employee development and business
growth.
FIGURE 5.15.1
ORION FUTURE MANAGEMENT ROLE

INJECTING MARKET
KNOWLEDGE
EMPLOYEE TURNOVER
EFFICIENT RECRUTMENT
EMPLOYEE ENAGAGEMENT ORION FUTURE MANAGEMENT

ROLE
TRAINING AND
COMPENSATION
DELEGATION
COMMUNICATION ABOUT
CHANGE TO EMPLOYEES
0 20 40 60 80 100 120
ICT INFRASTRUCTURE
Modifications and changes are required in the ICT infrastructure of Orion Food Industry.
Their current systems are old and inefficient. These cannot support the business for future
expansion and growth. An option for Orion Food Industry is to implement ERP software and
hiring experts to use it. But the cost structure should be taken in to consideration. Some of the
benefits and challenges of implementing ERP are:
ORION FOOD INDUSTRY
IMPLEMENTING ERP
(WordPress, 2011)
Costs
Even though the cost incurred is high Orion should try to implement ERP software as the
business is growing. As they are in the fast food industry the integration of business activities
is very important for their future growth. The consumer perception is increasing and to make
it growing an efficient IT infrastructure is needed for the business. Competitive advantage is
vital in fast food industry and in order to have a sustainable future growth; it is recommended
to have an ERP system in place.
ORION FOOD INDUSTRY
SALES AND MARKETING DEPARTMENT
As Orion is entering in to more dynamic overseas markets the sales and marketing efficiency
is essential for the business. They lack the service of a marketing professional. Also the
advertising and promotions are limited in their home markets and abroad. Orion should try to
improve their Brand image and brand awareness. They should push more products to
supermarkets and try to find shelf space in strategic locations. Marketing of their products is
essential due to large number of players in the industry.
RISK MANAGEMENT AND COST INVOLVED IN THE CHANGE PROCESS
Orion should evaluate the level of risk and costs that can arise during the change
management. The risk and expected cost should be calculated and identified before
implementing the change. The following table shows the expected costs and risk that can
arise during the change management process.
TABLE 5.15
(Change Management, 2012)
ORION FOOD INDUSTRY
LEADERSHIP
One of the most important criteria for Orion to succeed in future is through efficient
leadership. Leadership aims proper plan and motivating employees for the implementation of
the change. Orion should recruit marketing professionals from U.K to understand clear ideas
and changes in the market.
BUDGET
Orion should forecast the amount of financial resources that will be needed for future
expansion. This helps to coordinate different activities of the business. In the later stage as
the business grows in U.K, Orion can afford to have a strategic alliance with some
convenience food companies and also need to recruit and train staff. To attain this efficient
budget should be implemented.
ORION FOOD INDUSTRY
5.16 ORION FOOD INDUSTRY SDN BHD- GANTT CHART (3 YEARS)
YEAR1 YEAR2 YEAR3

SL.NO TASKS QTR1 QTR2 QTR3 QTR4 QTR1 QTR2 QTR3 QTR4 QTR1 QTR2 QTR3 QTR4
1 CONCEPT PHASE
1.1 IDENTIFYING
INTERNAL GAPS
AND TARGET SETTING
1.2 DEVELOP BUSINESS
PLAN
1.3 BUDGETORY PLAN
2 MARKETING AND
SALES
2.1 DEVELOPING
MARKETING PLAN
2.2 MARKET SURVEY
PRODUCT PLANNING
2.3 AND
PROMOTION
2.7 COMPETITOR
ANALYSIS
3 HUMAN RESOURCE
3.1 TRAINING AND
COACHING
3.2 WORK SCHEDULE PLAN
3.3 RECRUITMENT OF
MARKETING
PROFESSIONAL( HOME
AND ABROAD)
4 INFRASTRUCTURE
4.1 IMPLEMENTATION
OF ERP
4.2 WEBSITE PLANNING
4.3 WAREHOUSE
MANAGEMENT
4.4 R&D PLAN
5 INTERNATIONAL
ENTRY – UK
5.1 FEASIBILITY STUDY
5.2 COMPETITOR ANALYSIS
ORION FOOD INDUSTRY
5.3 ANALYSIS OF
ENVIRONMENT
5.4 PACKAGING AND
LABELLING
5.5 PRODUCT TESTING
FINANCIAL
6 ANALYSIS
6.1 BREAKEVEN ANALYSIS
6.2 FUNDING METHODS
6.3 IDENTIFYING
ALTERNATIVE
FUNDING SOURCES
6.4 CASH FLOW ANALYSIS
7 APPROVAL AND
IMPLEMENTATION
ORION FOOD INDUSTRY
5.17 INTERNATIONAL ENTRY STRATEGY- U.K
FIGURE 5.17
INTERNAL FACTORS
EXTERNAL FACTORS
OVERSEAS BUSINESS
MARKET POTENTIAL ENVIRONMENT.
MARKET RISK FIRM SIZE
POLITICAL RISK MANAGEMENT

EFFICIENCY
CULTURAL RISK
INTERNATIONAL
ENTRY MODE (U.K)
ORION
DIRECT EXPORT INDIRECT EXPORT LICENSING JOINT VENTURE WHOLLY

OWNED
SUBSIDIARY
Selecting the type of entry in to U.K is a vital part for Orion Food Industries. There are a
variety of choices available for Orion like direct and indirect export, Licensing, wholly
owned subsidiary and Joint venture. Orion should select the suitable entry mode to U.K
according to the cost, risk and degree of control over the business.
The following table shows the feasibility of various entry modes which Orion can choose
while targeting U.K market.
ORION FOOD INDUSTRY
TABLE 5.17
(Corporate Document Repository, 1997)
Best entry strategy which can be used
Based on the above advantages and feasibility options, in the initial stage Orion Food
Industry can choose direct exports. Direct export entry can be chosen because of the limited
funds and resources available to them. Also Orion Food Industry has experience in exporting
to overseas market. U.K is different from these markets and possesses high cultural
differences and market barriers. The appointed sales representatives should be fully aware
about the changing consumer tastes and difference. They should understand the market
potential and anticipated political risk which can hinder their process. Also efficient website
planning should be done for order processing and customer feedback. The following chart
shows the amount of online retail will go up by 23% in 2016 which is higher than any other
country.
ORION FOOD INDUSTRY
FIGURE 5.16.1
(Smart Insights, 2012)
Orion should also build relationship with local retailer abroad about the consumer perception
of their products and finding shelf space on grocery chains like Tesco and Sainsbury because
of the high customer traffic in these hyper markets. The other options which is available for
Orion is wholly Owned Subsidiary of a local food manufacturer in U.K. But this strategy
incures huge risk as well as cost.
5.18 INTERNATIONAL MARKETING STRATEGIES- U.K MARKET
Orion has different types of international entry modes available to them while targeting the
4/U.K market. The critical part is to choose one entry mode which benefits them in the long
run. There are some marketing mix strategies which Orion should analyse before entering the
U.K market:
5.17.1 PRODUCT SUPPORT

TABLE 5.17.1
ORION FOOD INDUSTRY
PROMOTION SUPPORT
Advertisement
Advertisement is the most important promotion tool which Orion can choose while
promoting their products. Research reveals that advertisement has influenced the buying
pattern of convenience and other fast foods by the people of U.K. Orion should select the
suitable media to promote their products in U.K. The following figure shows which media
has influenced most by the people of U.K in the purchase of convenience and fast foods.
FIGURE 5.18.2
(Ofcom, 2007)
Agents Commission
Another factor which Orion should consider is the commission given to the agents who are
transporting their products to U.K. They should agree the terms and conditions of the
commission as well as analyse the cost which incurred in the process.
Distribution Support
Raising Funds
Adequate funds should be raised by Orion when entering U.K marketing. Various costs like
marketing and sales, distribution costs, transportation costs and so on should be taken into
consideration. Also an efficient budgetary plan needs to be prepared.
ORION FOOD INDUSTRY
Order Processing
Order Processing is another important factor which Orion should give prior importance. They
should meet timely the orders of various customers in the U.K as well as supplier
relationship. The various activities like receipt of order, billing, credit check, production and
shipment and so on should be properly organised. This can be achieved by placing an
efficient IT system as well as experts to operate it.
SERVICE SUPPORT
Market Information
The ready meals market in U.K performed very well in the year 2011 in terms of volume and
value. This is because the number of people who are visiting and purchasing from various
grocery chains like Tesco, Sainsbury has increased. These chains sell a variety of ready meals
and attract large amount of customers. Most of the people in U.K are considering ready meals
as quick and a convenient option. The top sales of ready meals and packaged foods was by
Tesco with 21 % sales in the year 2011. (Euromonitor International, 2011)
Tax services
Orion should consider the various tax rates by U.K in terms of international entry. The issues
concerning VAT as well import and export licenses should be taken in to consideration.
According to the U.K tax regulations any business with more 70000 pound turnover has to
register and pay VAT. (Olswang, 2009)
ORION FOOD INDUSTRY
FEEDBACK AND AFTERSALES
Orion should also consider rate of consumer perception and the value they have given to
Orion foods in U.K. this can be obtained by the local distributor and through market survey.
5.19 FINANCIAL PROJECTIONS
5.18.1 PROJECTED CASH FLOW
PROJECTED CASH FLOW FOR ORION FOOD

INDUSTRY SDN BHD(3 YEARS)(US DOLLARS)
YEAR1 YEAR2 YEAR3
CASH INFLOW
CASH FROM SALES 8900000 10000000 11500000
OTHER CASH INFLOWS 0 0 0
TOTAL CASH INFLOWS 8900000 10000000 11500000
CASH OUTFLOWS
PURCHASE OF RAW MATERIALS 550000 1100000 1450000
WAGES, SALARIES AND COMMISSION 1760000 2110000 2260000
GENERAL EXPENSES 120000 135000 145000
INTEREST AND BANK CHARGES 40000 55000 62000
MARKET SURVEY COSTS 60000
CAPITAL EXPENDITURE 2000000
TOTAL CASH OUTFLOW 4530000 3400000 3917000
CASH FLOW SUMMARY

NET CASH FLOW FOR THE PERIOD 4370000 6600000 7583000
OPENING CASH BALANCE 0 4370000 10970000
CLOSING CASH BALANCE 4370000 10970000 18553000
ORION FOOD INDUSTRY
5.18.2 PROJECTED INCOME STATEMENT
PROJECTED PROFIT AND LOSS ACCOUNT FOR

ORION FOOD INDUSTRY SDN BHD(3 YEARS)(US
DOLLARS)
YEAR1 YEAR2 YEAR3
SALES 8900000 10000000 11500000

LESS:COST OF SALES 3000000 3500000 4000000
GROSS PROFIT 5900000 6500000 7500000
GENERAL AND ADMINISTRATIVE EXPENSES
INSURANCE 80000 100000 120000

SALARIES AND ALLOWANCES 1060000 1260000 1360000
R&D EXPENSES 2300000 2500000 2700000
OTHERS
TOTAL GENERAL AND ADMINISTRATIVE EXPENSES 3440000 3860000 4180000
SALES AND MARKETING EXPENSE
ADVERTISEMENT AND PROMOTION 1000000 800000 200000

SALARIES AND COMMISION 700000 850000 900000
DISTRIBUTION EXPENSE 120000 135000 300000
MAINTANENCE OF TRUCKS 30000 35000 38000
PRINTING AND STATIONERY 50000 60000 80000
TRAVELLING EXPENSES 150000 1650000 180000
OTHER EXPENSES 200000 200000 100000
LEGAL EXPENSES 200000 0 0

TOTAL SALES AND MARKETING EXPENSE 2850000 2020000 1798000
OTHER INCOME 200000 200000 200000
PBDIT -190000 82000 5902000
LESS: AMORTIZATION OF R&D -8000 10000 12000
DEPRECIATION -16000 17000 18500
PBT -214000 793000 5871500

LESS: TAX
INTEREST
NET PROFIT -214000 793000 5871500
ORION FOOD INDUSTRY
5.18.3 PROJECTED BALANCE SHEET
PROJECTED BALANCE SHEET FOR ORION FOOD INDUSTRY SDN

BHD (3 YEARS)(US DOLLARS)
YEAR1 YEAR2 YEAR3
FIXED ASSETS
FURNITURE AND FITTING 0 0 0
VEHICLE 150000 200000 500000
OFFICE EQUIPMENT 120000 150000 250000
R&D 50000 80000 120000
TOTAL FIXED ASSETS 320000 430000 870000
CURRENT ASSETS
TRADE DEBTORS 550000 750000 850000
CASH 45000 55000 70000
TOTAL CURRENT ASSETS 595000 805000 930000
TOTAL ASSETS 915000 1235000 1800000
LIABILITIES AND CAPITAL

CURRENT LIABILITY
TRADE CREDITORS 150000 170000 200000
OTHER CREDITORS 150000 185000 195000
TOTAL CURRENT LIABILITY 300000 355000 395000
NET CURRENT ASSETS 295000 350000 535000
LONG TERM LIABILITY

LONG TERM BORROWINGS 250000 200000 120000
OTHER BORROWINGS 170000 140000 50000
TOTAL LONG TERM LIABILITY 420000 340000 170000
NET ASSETS 195000 240000 1205000
FINANCED BY:
SHARE CAPITAL 0 0 0
RESERVES 215000 210000 1160000
RETAINED EARNINGS -20000 30000 45000
NET WORTH 195000 240000 1205000
ORION FOOD INDUSTRY
5.20 NEXT STEPS TO BE TAKEN
 Communicate effectively to the employees about the change that is needed to

implement. A clear idea about the Vision and Mission will help the employees to set
their initial targets and to work towards the achievement of business goals.
 Invest more on R&D department in future. As the business is growing innovation is
vital for sustainable growth. Focus more on healthier menus as the market trend is
shifting towards healthier foods.
 Ensure access to wide distribution channels to ensure competent and fast delivery of
food products. Maintain strong relationship with local distributors and suppliers
globally for quality products.
 Include more variety of menus to target wider market as there are a larger number of
foreign food companies in the home country.
 Modify the company infrastructure particularly IT so that efficient and smooth
business process will take place globally in future.
 Entering the U.K market is suitable for the business as the demand for packaged
meals shows positive growth. Proper entry strategy should be used as discussed in the
report considering the opportunities and threats.
 Hire more marketing professionals particularly from the target market U.K so that the
business can easily understand the market pulse and growth abroad. Increase
promotion and advertisement of the product to make public aware about the quality
and uniqueness of the product.
ORION FOOD INDUSTRY
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2012].
0030VMVM1011 Page 103

ORION FOOD INDUSTRY
APPENDIX
QUESTIONNAIRE
This questionnaire is prepared for the fulfilment of MBA programme (Master of

Business Administration) at Westminster International College, Malaysia.
Name:
Age: 18-30 31- 50 Above 51
Gender: Male Female
Occupation: Student Professional House wife Others
1. Would you prefer to buy Orion Food products because of your busy schedule?
Always
Once in a week
Once in a month
Not Interested
2. Do you like to buy Orion Meals if they include healthier menus and contain low fat?
Definitely
Probably
Not Sure
Definitely Not
3. Do you suggest Orion foods need more marketing and promotion to increase more
brand awareness?
Strongly Agree
Disagree
4. Do you think that it is right time for Orion Food Industry to enter U.K market?
Strongly Agree
Agree
Neither Agree or Disagree
Disagree
Strongly Disagree
5. Do you think that Orion foods will earn substantial profit from U.K market with
proper planning?
Agree
Disagree
0030VMVM1011 Page 104

ORION FOOD INDUSTRY
6. Do you think that Orion Food Industry can compete strongly in future against the
foreign fast food companies in Malaysia?
Agree
Disagree
7. Which area in future should Orion Food Industry should focus more?
Management
IT infrastructure
Marketing
Human Resource
All of the above
0030VMVM1011 Page 105

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ORION FOOD INDUSTRY

“A STUDY ON THE FUTURE CHALLENGES, OPPORTUNITIES, AND

STUDENT ID: 0030VMVM1011

MASTER OF BUSINESS ADMINISTRATION

CARDIFF METROPLITAN UNIVERSITY

YEAR OF SUBMISSION: SEPTEMBER 2012

1.1 CASE SUMMARY....................................................................................... 9

2.1 REPORT DESIGN AND RATIONALE..................................................11

2.2 ACTIONABLE ASSUMPTIONS..............................................................12

2.3 BUSINESS MODEL....................................................................................13

2.4 TIME HORIZON FOR THE WOK UNERTAKEN...............................14

CHAPTER -3 PROBLEMS/ OPPORTUNITY STATEMENT AND ANALYSIS PLAN...15

3.1 PROBLEM/ OPPORTUNITY STATEMENT.........................................15

3.2 RESEARCH QUESTIONS.........................................................................16

3.3 RESEARCH OBJECTIVES.......................................................................16

3.4 DATA COLLECTION................................................................................17

3.5 ANALYSIS TOOLS USED.........................................................................18

CHAPTER – 4 ANALYSIS AND FINDINGS...........................................................................23

4.1 CANVAS MODEL........................................................................................23

4.3 PORTER’S FIVE FORCES.........................................................................30

4.5 PORTER’S DIAMOND................................................................................37

4.6 PEST ANALYSIS..........................................................................................40

4.7 FEASIBILITY OF TARGET MARKET- U.K..........................................44

4.8 KEY FINDINGS.............................................................................................49

CHAPTER – 5 PROPOSED PLAN OF ACTION........................................................................50

5.1 INDUSTRY ANALYSIS................................................................................50

5.2 COMPANY HISTORY..................................................................................53

5.3 MARKET ANALYSIS....................................................................................55

5.3.1 MARKET SEGMENTATION..............................................................63

5.3.2 MARKET SIZE.......................................................................................64

5.3.3 MARKET NEEDS..................................................................................64

5.3.4 MARKET TRENDS AND DEMAND.................................................64

5.4.1 PRODUCT DESCRIPTION.................................................................65

5.4.2 FUTURE PRODUCTS AND SERVICES...........................................66

5.5 CUSTOMER ANALYSIS.............................................................................67

5.6 VALUE CHAIN ANALYSIS.......................................................................69

5.7 STAKEHOLDER ANALYSIS....................................................................71

5.9 BUSINESS OBJECTIVE.............................................................................74

5.10 FINANCIAL OBJECTIVE.......................................................................74

5.11 COMPETITIVE POSITIONING.............................................................74

5.12 STRATEGIES FOR SUSTAINABILITY...............................................75

5.13 CRITICAL SUCCESS FACTORS...........................................................78

5.14 SMART OBJECTIVES..............................................................................80

5.15 CHANGE MANAGEMENT PLAN AND IMPLEMENTATION

5.16 GANTT CHART.........................................................................................88

5.17 INTERNATIONAL ENTRY STRATEGY – U.K..................................90

5.18 INTERNATIONAL MARKETING STRATEGY U.K.........................92

5.19 FINANCIAL PROJECTIONS..................................................................95

5.19.1 PROJECTED CASH FLOW..........................................................95

5.19.1 PROJECTED INCOME STATEMENT......................................96

5.19.3 PROJECTED BALANCE SHEET...............................................97

5.20 NEXT STEPS TO BE TAKEN................................................................98

Table 4.6 - Showing the demographic classification of Malaysia.............................42

Table 4.7- SWOT analysis of U.K food industry.....................................................46

during the year 2009 and 2010..................................................................51

Industry Sdn Bhd in different years........................................................54

Table 5.2.2 – Orion Food Industry financial performance indicators.........................54

Table 5.3 – Showing the number of fast food chains in Malaysia...............................55

Management Process. ...............................................................................84