final report shezan
TRANSCRIPT
University Of Central Punjab
Business plan SHEZAN
Made by?
Muhammad Amjad Abbasi
University Of Central Punjab PCIT
RAWALPINDI
1
Acknowledgement
We have the pearl of our eyes to admire blessing of the compassionate
and omnipotent because the words are bound, knowledge is limited
and time is short to express His dignity. It is one of the infinite
blessings of almighty ALLAH that He bestowed us with potential and
ability to complete the present training and make a material
contribution towards the deep oceans of knowledge.
First we avail this opportunity to bow our head before ALLAH almighty
in humility who given us the wisdom and perseverance for completing
this piece of report.
We invoke peace for Holy Prophet Muhammad (P.B.U.H) who is forever
torch. We feel highly privilege to ascribe the most and ever burning
flame of my gratitude and deep scene of devotion to the Prof. Irfan
Iqbal who taught us “business project” with heart and also gave a
guideline to this report.
JUNE 2009
University Of Central Punjab PCIT
RAWALPINDI
2
Table of Contents
Company Profile…………………………………………………………..7
Board of Directors……………………………………………………………….7
Audit Committee……………………………………………………………….7
Director & company Secretary……………………………………………….. 7
Auditors…………………………………………………………………………7
Chief Financial officer…………………………………………………………7
Legal Advisors…………………………………………………………………7
University Of Central Punjab PCIT
RAWALPINDI
3
Brief History …………………………………………………………….8
Vision & Mission Statement……………………………………………9
Product Range……………………………………………………………10
Local Consumer Products……………………………………………………
Exports…………………………………………………………………………
Process of
making……………………………………………………….
Fruit Juice - Production Process Flow…………………………………………
Fruit juice production process …………………………………………………
Packing……………………………………………………………………………
Storage…………………………………………………………………………..
Product Shelf life……………………………………………………………….
RAWMATERIAL REQUIREMENT…………………………………………………
Other Raw Material……………………………………………………….
TECHNOLOGY AND PROCESSES……………………………………………….
Machinery requirements…………………………………………………
University Of Central Punjab PCIT
RAWALPINDI
4
SECTOR & INDUSTRYANALYSIS………………………………………………
Sector Characteristics and overview………………………………….
Marketing Mix………………………………………………………….
Product ……………………………………………………………………
What Is "Product"? ……………………………………………………..
Nature of the product…………………………………………………..
Ingredients in Shezan Twist Juice (Product …………………………
Product Flavors Available……………………………………………..
The Target Market of the Product ……………………………………..
Competition of the Product
…………………………………………….
Direct ………………………………………………………………………….
Indirect Competitors…………………………………………………………
Shipping Units……………………………………………………………
Market and Positioning Of the
Product……………………………………….
Performance in the Market of the
Product……………………………………
University Of Central Punjab PCIT
RAWALPINDI
5
Pricing……………………………………………………………………
….
What Is "Price"?
…………………………………………………………………..
Pricing
Strategy………………………………………………………………….
Current Price……………………………………………………………………
Price Control…………………………………………………………………..
Pricing Objectives……………………………………………………………..
Factors Affecting the Price of Shezan Twist
juice…………………………
Differential Advantages the Company
Have………………………..
Placement …………………………………………………………………
The Channel of Distribution………………………………………………….
Distribution Strategy…………………………………………………………
Distribution Areas……………………………………………………………
Place for storage………………………………………………………………
University Of Central Punjab PCIT
RAWALPINDI
6
Demand increases……………………………………………………………
Logistics……………………………………………………………………….
Promotion…………………………………………………………………
Target Fragment………………………………………………………………….
Budget for Promotion…………………………………………………………..
Environmental Analysis……………………………………………………………….
The Company……………………………………………………………………
Suppliers………………………………………………………………………….
Customers…………………………………………………………………………
Competitors……………………………………………………………………….
Internal environment……………………………………………………………..
Internal environment…………………………………………………………….
Distributors……………………………………………………………………….
University Of Central Punjab PCIT
RAWALPINDI
7
BCG Matrices……………………………………………………………….
SWOT ANALYSIS…………………………………………………………
Conclusion………………………………………………………………
….
Recommendations……………………………………………………
……
Company’s Profile
University Of Central Punjab PCIT
RAWALPINDI
8
Brief HistoryShezan Company was incorporated on May 13, 1964 as a private
limited company, with the objectives as set out in the Memorandum of
Association in general and in particular to set up an industrial
understanding for manufacture of juices, squashes, sharbats, jams
pickles and preserves from fruits and vegetables
Nature has blessed Pakistan with an ideal climate for a wide range of
delicious fruits. Over the centuries Pakistani experts have acquired and
developed unique strains of exotic fruit varieties, unmatched for their
rich flavor and taste
University Of Central Punjab PCIT
RAWALPINDI
9
The Shahnawaz Group of Pakistan and Alliance Industrial Development
Corporation of U.S.A in1964 conceived Shezan International Limited as
a joint venture. The agriculture background of the Pakistani sponsors
induced them to establish this agro-based industry. Taking advantages
of abundance of fruits available in Pakistan, and the advanced
technology provided by the American partners, Shezan became
pioneers in the field of converting fruits into pulps, concentrates and
juices. Today Shezan is the largest food processing unit having
developed and installed the capacity to meet the country’s and export
needs.
In 1971 the Shahnawaz Group purchased all the shares of Alliance
Industrial Development Corporation with the permission of the Pakistan
Government. The Company has since shown sustained growth in both
the domestic and exports fields. The Company has been steadily
expanding its production capacity over the years. In 1980-81 a
separate unit was installed in Karachi which now caters for Karachi,
Sindh and export demand. A new bottle filling plant was set up in 1983
in Lahore unit increased the capacity five-fold. An independent Tetra
Brick Plant was commissioned in 1987 making us the leading
manufactures with comprehensive range of production in the fruit
processing field in Pakistan
Vision statement
University Of Central Punjab PCIT
RAWALPINDI
10
“To be known as leader of quality products in the
region. Dedication to quality is a way of life at our
company. In its activities the company will pursue
goals aimed at the achievement of profitable business
.these results will be derived from the dedicated
efforts of each employee in conjunction with
supportive participation from management at all
levels of the company .To pay its role in the economic
development of the country and to enhance quality of
life of its people”
Mission statement
“Our mission is to provide the highest quality fruit and
vegetable related juices and products to retail and
food services customers. We will accomplish this by
University Of Central Punjab PCIT
RAWALPINDI
11
maintaining a tradition of pride in our products,
growth through innovation, integrity in the
management of our business and commitment to
team management and quality improvement
process.”
Product Range
Shezan is producing a variety of quality products. Shezan is largely
considered as market leader in fruit and vegetable processing industry.
Shezan has an edge over other with its own fruit farms. Currently
Shezan is giving tough time to other fruit juice manufacturers due to
its quality and huge export volume as well as capturing local fruit juice
market where it has competition with Nestle and Haleeb.
Products can be divided into the following
University Of Central Punjab PCIT
RAWALPINDI
12
Local Consumer Products
Following are the major products that Shezan is producing currently:
1- All Pure
2- Juice Bottles
University Of Central Punjab PCIT
RAWALPINDI
Types of Products
Local Consumer Products Exports
13
3- Regular Juices
4- Twist
5-Syrups 8-
Sauces
6 -NR-Bottles 9- Jams
University Of Central Punjab PCIT
RAWALPINDI
14
7-Vinegar 10- Quench
11- Squashes
12- Mango Nectar
University Of Central Punjab PCIT
RAWALPINDI
15
13-Pickles
13- Ispaghol
Exports
University Of Central Punjab PCIT
RAWALPINDI
16
Process of making
Fruit juice production procedures involved in fruit juice manufacturing.
Fruit Juice - Production Process Flow
Production of fruit juices is a standardized process and type of
technology depends on type of fruits and scale of operations. Initial
preparatory processes for all fruits will be similar, as will be the last
stages of juice/pasteurization section and packaging, although
differences in handling juice composition arise in certain cases due
to the nature of the fruit and percentage of pulp involved.
Basically, preparation process of Twist juices involves the following
steps:-
• Washing and cutting of fruits• Boiling of fruit pulp
I) Pulp Storage in Tank
II) Sugar Hopper
• Pulp and ingredients mixing • Syrup Storage in Tank• Juice Preparation• Juice Storage Tank • Filling and Packaging • Cooling and Storage
University Of Central Punjab PCIT
RAWALPINDI
17
University Of Central Punjab PCIT
RAWALPINDI
18
Fruit Juice Production Process
After washing and cutting the fruit pulp is separated after that Pulp is
shifted to the boiler where it is cooked and shifted to the plate heat
exchanger. Pulp is then stored in the pulp storage tank. Pulp is then
supplied to the mixing tank in the desired quantity while in mixing
tanks; any additives to the pulp are made at this stage before it is
pumped to syrup storage tanks. Blended juice is then pumped through
pasteurizer; where it is heated to 90oC to inactivate enzymes and living
organism. After pasteurization the juice passes through final
filtration, before loading it into a juice storage tank. Juice from the
tank is ready for packaging
Packing
The juice will be then packed in the quantities 250ml. Packaging is
done on imported machinery as it considered being highly
sophisticated and hygienic
Machinery Used -Fruit Juice Filling & Packaging Line
S. No.
Machine CapacityLocal/Imported
1
Tetra Pak –TBA 19 7500 packs of 250 ml/ hr
Tetra Pak
University Of Central Punjab PCIT
RAWALPINDI
19
Storage
Products will be stored in cool dry store before distribution.
Product Shelf life
Twist Juice in 250ml serving packs have shelf life of less then 6 months.
RAWMATERIAL REQUIREMENT
Raw material required for manufacturing fruit juice are fruit pulp, citric acid, food color, sugar, preservatives and fruit flavors. Although, juice manufacturers use molasses to thicken the juice, this is not a good practice and therefore should be avoided. All raw materials are easily available in the local market, however, fruit pulp is considered to be the principal component of the high quality fruit juice, therefore, its continuous and within the required quantity availability will need some advance planning. Fruit pulp could be purchased from open market or directly from pulp producers, however, it would be safe to sign a contract or negotiate with a pulp producer to insure the availability of pulp before the commencement of production operations. Prices for the fruit pulp have been collected from the market and are given below:
University Of Central Punjab PCIT
RAWALPINDI
20
Other Raw MaterialThe ratio and utilization of other raw material depends on what percentage of pure juice the unit is going to produce; however, following are the main ingredients which will be required for the juice production proposed for this product.
Treated Water 75% Fruit Pulp 17% Sugar Citric Acid Fruit Flavor 8%-10% Preservative
Machinery required for the processing of fruit and juice packaging is available both local and imported. Local packaging machinery reportedly give poor quality output especially for fruit juice packaging which is considered to be highly sophisticated and hygienic; hence it could not be done by using local machinery. However, pulp processing and juice production could be done on locally fabricated machinery. Following machinery will be required for setting up a fruit juice plant:
Fruit Juice Pre-Packaging Production Line Fruit Juice Filling & Packaging Line Fruit Juice Cooling and Refrigeration Machinery
University Of Central Punjab PCIT
RAWALPINDI
21
MACHINERY REQUIREMENTFor the fruit juice production, packaging and storage both local and imported machinery can be used, however, for packaging it is proposed to use imported machinery rather than local machinery which is although a low cost option, yet do not provide good quality and quantity of output.
University Of Central Punjab PCIT
RAWALPINDI
22
SECTOR & INDUSTRYANALYSIS
SECTOR CHARACTERISTICS AND OVERVIEW
Agriculture sector highly depends on the weather circumstances. God has gifted Pakistan with several varieties of fruits and vegetables. Modern processing and packaging techniques make seasonal fruits and vegetables available all year round to almost all parts of the globe. Tropical fruit like mangoes can be enjoyed in temperate countries. Today, the world horticulture industry is a $77 billion market comprising of the following sub sectors.
Vegetables; fresh or preserved Fruits and nuts; fresh or preserved (excluding oil nuts) Fruit and vegetable juices (unfermented). Spices Bulbs, tubers, rhizomes of flowerings Cut flowers and foliage
Provincial fresh fruits production share is provided below:
Province % Share
Punjab 59.6
University Of Central Punjab PCIT
RAWALPINDI
23
Sindh 8.6
NWFP 6.2 Balochistan
25.6
Marketing Analysis Of
Shezan Twist juice
Product
University Of Central Punjab PCIT
RAWALPINDI
24
Marketing Mix
"Marketing Mix is the set of controllable tactical marketing tools
that are product, price, placement and promotion. The firm blends
these tools to produce the response it needs from the target market."
University Of Central Punjab PCIT
RAWALPINDI
Marketing Mix
Product Price Placement Promotion
25
PRODUCT
What Is "Product"?
"Anything that can be offered to a market for attention,
acquisition, use or consumption that might satisfy a want or a need is a
product. It includes physical objects, services, persons, places,
organizations and ideas."
Shezan Twist
Comprising of a blend of different fruit juices,
shezan`s Twist juices open the door to a whole
new world of possibilities. Available in easy to
drink slim packing twist juices are a must have in
every household
Nature of the product
University Of Central Punjab PCIT
RAWALPINDI
26
Everyone has their own ideas about replacing essential body fluids,
vitamins and minerals - whether it's after exercise or just a tiring day
at the office. Fruit juice is still one of the best ways to replenish the
body's essential nutrients and it's a natural source of energy. Common
people especially young generation is inclined to have ready to
consume drinks; in addition hotels, hospitals are also expanding
day by day where juices could be marketed successfully.
Ingredients in Shezan Twist Juice (Product)
Energy 127 cal
Total Fat 0.0 gm
Proteins 0.15 gm
Total Carb 32.5 gm
Sodium 1.5 mg
Sugar 31 gm
Vitamin C 5.7 mg
Percent daily values are based on 2000 calorie diet
University Of Central Punjab PCIT
RAWALPINDI
27
Product Flavors Available
1-Apple
2- Raspberry,
3- Pineapple,
4-Fruit punch,
5-Mango Strawberry,
6-Mango
The Target Market of the Product
The target market of Shezan twist juice includes teenagers.
Basically they are targeting the students of schools, Colleges and
Universities.
University Of Central Punjab PCIT
RAWALPINDI
28
Competition of the Product
Direct
Indirect Competitors
University Of Central Punjab PCIT
RAWALPINDI
29
+
All other international brands. They Comprise 2% of total
market
Shipping Units
250 ml36 Packs per carton
(6*6 Wrapped Packing)
Market and Positioning Of the Product
The market is highly saturated in the drink, which are ready to
use
Performance in the Market of the Product
Brand Market Share
Nestle juice 45%
Country juice 5%
University Of Central Punjab PCIT
RAWALPINDI
30
Tropico Juice 18%
Shezan Twist juice 35%
International 02%
Pricing
What Is "Price"?
Price is the value placed on goods and services. Price is the
amount of money and /or goods needed to acquire some
combination of another and its accompanying services.
Pricing Strategy
Shezan when introduced twist juice in the market set the
price at Rs. 12/- while the competitive price was Rs. 10/-. This above
average price was due the better quality product and a new Juice
brand by a well knows Juice Company and Industry giant.
Current Price
The current price of one 250ml pack of Twist is Rs.15/-
When we purchase 3dozen of 250ml of Twist than the
price of this is Rs.468/-
University Of Central Punjab PCIT
RAWALPINDI
31
Available Size of Shezan Twist Juice
The Shezan Twist juice is available in only one size of 250 ml
Price Control
There are no price controls and this has happened after the introduction of local government system under the devolution plan. Companies are given free hand in charging enormously high prices for processed food items. They use little quantity of Fruit pulp in making the juice and charge very high price.
University Of Central Punjab PCIT
RAWALPINDI
32
Overall Distributor or Whole Seller Margin 07-10%
Retailer’s Margin 12-15%
Source Purchase Sale Price Profit
University Of Central Punjab PCIT
RAWALPINDI
33
Price
School, Colleges and
Universities 12 15 3
Whole Seller 12 12.90 .90
Retailer 12.90 15 2.10
Pricing Objectives
The objectives of Festival Juices for pricing Juice Products are as
follows:
1. To achieve a target return.
2. To maximize profit.
University Of Central Punjab PCIT
RAWALPINDI
34
3. Stabilize prices to meet competition.
4. Market share Leadership
5. Product Quality Leadership
Price Table with the Pure Competitor
Name of the Company Price Of the Juice
Nestle Juice Rs. 18/-
Shezan Twist Juice Rs. 15/-
Country juice Rs. 12/-
Tropico Juice Rs. 12/-
Factors Affecting the Price of Shezan Twist juice
The following are the some factors that are affecting the price of Shezan twist juice.
They are using the expensive technology
The transportation , roads are not in a good condition
University Of Central Punjab PCIT
RAWALPINDI
35
The un stable politicians, which have positive and negative effect
on the price
The labor cost is low in Pakistan as compare to the others
The advertisement is increasing the cost price of it but this is
necessary
Due to increase in taxes the price of them is also increased
They are using tetra packing which increase their cost
Differential Advantages the Company Have
The name of the Company
Very Large capital in whole company
The good reputation in the market
The combination of Flavors
Foreign technology , they are using
One of the oldest company in private sector
They have their own plant of tetra packing
PLACEMENT
University Of Central Punjab PCIT
RAWALPINDI
36
The distribution network includes the distributor then the wholesaler
and in the end the retailer. Again benefits are provided on the
achievement of the sales targets and timely delivery of products. In
some cases products are provided to big retailers by the distributor
itself but mostly it is being purchased by the retailer from the
wholesaler.
Distribution Strategy
University Of Central Punjab PCIT
RAWALPINDI
37
Through the heavy advertisement the distribution can be
affected because the distribution mainly depends upon the demand.
In the Shezan twist they are using the above channel fro distribution
the product
Some of people who wants to purchases very heavy amount
of the twist juice , they come to the company directly and buy
which is required
The whole seller are purchasing them for the resale able
purpose but less then the first once
They have Zonal offices in different areas such as Rawalpindi,
Lahore, Multan e.t.c to make it easy to sell
Distribution Areas
They are distributing in major cities such as:-
City Name Distributors
Lahore 200
Karachi 200
Islamabad 100
Total 500
Place for storage:-
University Of Central Punjab PCIT
RAWALPINDI
38
They have the stores to store the juice packets before the juice
goes for distribution
Demand increases
They always have the backup store juice to fulfill this demand
Logistics
To deliver the right quality and quantity of the twist juice,
they are working on the daily bases
They have large number of trucks to achieve all the things
according to their product
For distribution they are always have the future planning
University Of Central Punjab PCIT
RAWALPINDI
39
Promotion
Shezan is using following mediums for promotion of twist
Billboards
Television
Radio
Newspapers
Broachers
Internet
University Of Central Punjab PCIT
RAWALPINDI
40
They are doing these things according to the plans, for example
They now wants to advertise the product more through media
by using the famous people
For the promotion of the product they are giving the free
product in the start of the season
Large discount for the people who purchase the Shezan twist
juice directly from the company and in large amount
Giving free samples to the people who visit the company
University Of Central Punjab PCIT
RAWALPINDI
41
They are also arranging some charity shows in Karachi
They have given a very large amount to the people who suffers
form the earthquake in Pakistan
Stale operations are functioning in which they are giving the
free testing samples
There are spending a lot of money in the preparation of
mosques
There are giving free Translated Quran, which are in more than
150 languages
They are also working in a Islamic Jameet named Ahmediya
Target Fragment
University Of Central Punjab PCIT
RAWALPINDI
42
The target fragment for the product s the people using
juices instead of the soft drink like Coke and Pepsi
Budget for Promotion
A. Electric Media 75%
B. Printed media 25%
Environmental Analysis
University Of Central Punjab PCIT
RAWALPINDI
43
1)The Company:- The people in the company they are not working as a team
2)Suppliers:- Efficiency of the suppliers in the company is nice but
required more improvement
3)Customers:- The target market of the product is the teenagers mainly
4)Competitors:- Nestle is the pure competitors of the Shezan twist juice
5)Internal environment:- The internal environment is good but requires more
changes
6)Technological :- They are using the foreign technology which is their plus
point
7)Marketing:- Need to spend money field in marketing field
8)Distributors:- The distributors are in the Islamabad, Lahore, Karachi but
they are not handling the areas perfectly
BCG Matrices
University Of Central Punjab PCIT
RAWALPINDI
44
Shezan twist juice is the star product in the season and when the
season is of this becomes the Cash cow product/
SWOT ANALYSIS (ACCORDING TO THE
COMPANY)
Strengths
Conveniently placed factory
Pure and natural products
Qualified sales staff
Strong financial backup
Good distribution net work
Effective advertisement campaign
Weakness
Due to high rate of taxes our process are higher
University Of Central Punjab PCIT
RAWALPINDI
45
Tax evaders sell product on much less prices and retailers
blackmail for better profit margins
Opportunities
Expansion of distribution net work
Diversification of product
Addition of new varieties
Modification according to present requirement
Threats
Discount offered by competitors
Low quality food products on cheap prices
WTO
Less awareness of health
Nutritional facts of products with consumer
SWOT ANALYSIS (ACCORDING TO THE GROUP)
University Of Central Punjab PCIT
RAWALPINDI
46
Strengths
The Name of the company Shezan
One of the oldest company in private sector
Using foreign technology
The honest and determined employees
A global business
ISO certificated
They are using near to pure Ingredients
No complains on the quality
Weaknesses
Internal environment is not so good
Advertisement is weak
Distributors are not impressive
The sales manager have no much experience in this field
Product is promoting mainly in teenagers
Opportunities
They can introduce the Shezan twist in unready form
University Of Central Punjab PCIT
RAWALPINDI
47
By increasing the advertisement, possibly the sales will increase
They can introduce this in 1 Liter packing
More and new flavor can be introduced
They can introduce these twist juices in powder form
Threats
High taxes on them
They cant export without the permission of the Government
The Currency Value of the Pakistan is low
This product is seasonal
They are paying high taxes in exporting
Discount offered by the competitors
Conclusion
University Of Central Punjab PCIT
RAWALPINDI
48
According to our group mates after visiting the company and taking
information from the market we have concluded that:-
They are going good but have to improve internal environment
They have to improve their distributor sector.
They have to make new strategy for the competitors like Nestle
They have large capital , so they have to spend more money in the
advertising field
They have to introduce New flavor In the market
They can introduced these twist juices in 1 Liter packing
They can introduce these juices also in powder form.
Recommendations
As we have mentioned that Shezan needs to improve its
distribution strategy. Shezan is targeting youngsters as a potential
and big market for its twist juice so if company supply directly to
the schools, colleges and universities it removes intermediaries
University Of Central Punjab PCIT
RAWALPINDI
49
and due to high profit ratio café owners will promote Twist
compared to other juices.
Company Owned
Distribution House
Another important recommendation we want to give is this that
Shezan need to come up with a different kind of packing. Juice
packing with straw is not convenient for consumer as sometimes
juice fell when we insert straw and sometimes some juice still
remain in the pack that cannot come up with the straw. To resolve
this issue Shezan must introduce packing with cap on it in spite of
using straw. Quantity should be increased to 300ml and price
should be Rs. 20/-
University Of Central Punjab PCIT
RAWALPINDI
50
Schools
Colleges
Universities