Group Members

Waseem Azam Fahad Tariq Abu Bakar Danish Aftab Almas Umer Waqas Aziz

Muhammad Abu Bakar

ENGRO

INTRODUCTION
Incorporated in 1965. Fertilizer in Pakistan. With the name of EXXON Chemicals. 1991 Name changed as Engro. Joint venture engaged in chemical related activities. New milk plant is established in Sukkar

Diversified Portfolio
Fertilizer Business Engro Energy Limited Engro Innovative Automation Limited Engro Vopak Terminal Limited Engro Asahi Polymer &Chemicals. Limited Engro Food Limited

Our Affiliates

MISSION STATEMENT
Our mission is two fold, to help farmers maximize their farm produce by providing quality plant nutrients and technical services upon which they can depend. To create wealth by building new businesses based on company and country strengths in petrochemicals, information technology, infrastructure, food and other agriculture sectors.

Vision Statement
To be the premier Pakistani enterprise with a global reach, passionately pursuing value creation for all stakeholders.

WASEEM AZAM

ENGRO FOODS

Food industry in Pakistan

The food and its allied products industry is considered Pakistans largest industry 27 percent of its value-added production Total value of production is over Rs.46 billion

Engro Food
More than 40 years in fertilizer and chemical. Engro Foods started its business operations in March 2006 Successful launch of Olpers Milk, Tarang, Olwell, and Olpers cream, Two processing plants at Sukkur and Sahiwal. Our aim is to dominate the food business.

Our Brands

Our Values Integrity Our People Innovation CSR Consumer Centric

Vision according to Engro Foods Aims at transforming the company within the next five years into first a national food industry giant, then into a regional force and finally into a global player.

Mission according to Engro Foods

Build Branded food business to improve quality of life by offering tasty, affordable and highly nutritional products to our consumers while maximizing stake holders' value

Objectives And Goals

Supply everyone their favorite olpers Milk to satisfy the consumer needs and wants. To provide profit to the shareholders and increase the market share. EFL dreams to be BIG We want to be a major player in the food industry "Elevating Consumer Delight Worldwide". EFL wants to challenge the industry norms and surprise whoever has eyes on EFL.

ANALYSIS OF MISSION
Component of mission statement Customers Products or service Markets Technology Concern for survival, growth and profitability Philosophy Description Who are the firms customers? What are the firms major products? Geographically, where does the firm compete? Is the firm technologically current? Is the firm committed to growth and financial soundness? What are the basic beliefs, values, aspirations, and ethical priorities of the firm? What is the firms distinctive competence or major competitive advantage? Is the firm responsive to social, community, and environmental concerns? Are employees a valuable asset of the firm? Addressed or not? Yes Yes Yes No Yes

Yes

Self-Concept

Yes

Concern for public image

No

Concern for employees

No

DANISH AFTAB

PORTERS FIVE FORCES MODEL

COMPETITIVE RIVALRY
The food industry is becoming highly competitive. low cost structure, greater efficiency and better customer service will beat out competitors. Food companies also use higher investment returns competition between Engro foods and Haleeb is quite intense

THREAT OF NEW ENTRANTS

The average entrepreneur can't come along and start a large food company. Capital requirements Production of packed products requires huge investment of financial, human, technical, and marketing resources. Economy of scale potential competitors either to enter on a large scale bases (a costly and perhaps risky move) or to accept a cost disadvantage.

AVAILABILITY OF SUBSTITUTES

There are plenty of substitutes in the food industry Companies focusing on niche areas usually have a competitive advantage Most large food companies offer similar suites of services

BARGAINING POWER OF SUPPLIERS Number of suppliers Raw milk is standard commodity and is available in the open market from a large number of milkmen Importance of volume to supplier Suppliers also have less leverage to bargain over price

BARGAINING POWER OF BUYERS

The individual doesn't pose much of a threat to the food industry Large clients have a lot more bargaining power with food companies. (Large corporate clients
like airlines )

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

Strengths
S W OT An aly sis
strong brand name i.e. Engro PR with farmers Positive response from customers Strong consumer & product research Third-Generation Plant Worldwide fame of Engro. Efficient milk collection system. Keeping high quality standards. Integrated distribution and warehousing facilities. Successful related diversification. Generic brand name of Olpers

Weaknesses
S W OT An aly sis
Olwell TVC Owning Red Color Low Quality Milk Packaging Milk collection & distribution costs Narrow brand portfolio Unable to compete in price sensitive segment of UHT milk market. Under-utilization of the capacity. Unable to fulfill the demand of local powder milk market. Not yet ISO certified

Opportunities
S W OT An aly sis
Increased funding by Government Increased consumption of PLM Awareness Third largest producer of milk Population growth rate. High urbanization rate. High literacy rate. Flexible government policies for food industry. Have significant growth opportunities Has sufficient capital to expand. Has the potential to innovate and differentiate the company's products to sustain a competitive advantage May merge with other global businesses to eliminate competitors. Having Capable of expanding into other markets of the world

Threats
S W OT An aly sis
Competition Perceptions and Price Differentials High inflation rate. Low purchasing power. Decrease in GDP growth rate. Increasing interest rates. Decreasing investment. Recessionary period in business cycle Competition with Nestle, Engro Foods and the new entrants. Engro foods is currently facing are increase in Sales Tax

FAHAD TARIQ

Strengths
INDUS TRIAL SWOT ANAL YSIS
Endowed with the very good breed of buffalos and cows Highest per capita consumption of milk in Asia Regular culling of less productive/unproductive animals A high ratio of agricultural land to agricultural ratio An emergence of commercial dairy farms on a large scale

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

Opportunities
INDUS TRIAL SWOT ANAL YSIS
Huge unsatisfied demand of milk and milk products. Substantial scope for increasing milk production through improvement in the marketing system by ensuring a year round remunerative price to milk producers Increase consumer awareness of healthy eating

Threats
INDUS TRIAL SWOT ANAL YSIS
Unregulated imports of dairy products at cheap prices Inadequate public and private investment in modernization of the sector Vested interests in perpetuating the dependence on imports of dairy commodities

SWOT matrix

STRENGTHS
Worldwide fame of Engro. Efficient milk collection system. Keeping high quality standards. Integrated distribution and warehousing facilities. Generic brand name of Olpers Large market share of Engro innovative and chemicals. Having Good reputation in the market by strong brand name i.e. Engro Strong R&D

WEAKNESSES
Unable to compete in price sensitive segment of UHT milk market. Under-utilization of the capacity. Unable to fulfill the demand of local powder milk market. Not yet ISO certified

OPPORTUNITIES
Improving Economy
Population growth rate. High urbanization rate. High literacy rate. Flexible government policies for food industry. Have significant growth opportunities May merge with other global businesses to eliminate competitors. Having Capable of expanding into other markets of the world

SO Strategies
Increase production of quality milk to cater the unsatisfied demand(S2,O2,O8)

WO Strategies

As per the increase demand of the milk they should fulfill the demand as EFL have the ability to expand.(W3,O8). They should go in the product line of powdered milk. (S8,O2,O5) They should make a strong distribution system to cater to avail the full benefit of the growing market.(W3,O2 They should increase their exports. (S1,O6,O7)

They should cater the wide range of unsatisfied demand by improving their distribution networks(S4,O8)) They should adopt affective marketing strategies for the promotion of their product.(W2,O1)

THREATS
High inflation rate.

ST Strategies
Invest more on the dairy product line as there is still a large chunk of the market which require modernization (S6,T5)

WT Strategies

Low purchasing power. Introduce new technology for quality

The co-ordination between different departments of EFL should be improved it will lessen the bureaucratic cost and increase the efficiency of the company.

Internal Factor Evaluation Matrix

Key Strategic Factors Weights Strengths Brand Image Growing Sales Market Share Distribution Channel Product Quality Capacity Innovation Customer Oriented Qualified Work force R&D Business without Interest Exporting Local Company Centralized Decisions No Sales on Credit High Price Uncertain Economic & Political Conditions Market Demand Striker Terms And Conditions Promotion Total 0.08 0.03 0.05 0.08 0.07 0.08 0.04 0.02 0.01 0.05 0.02 0.06 Weaknesses 0.05 0.09 0.06 0.05 0.03 0.05 0.03 0.05 1 1 2 2 2 1 2 1 2 0.05 0.18 0.12 0.1 0.03 0.1 0.03 0.1 2.83 4 3 3 4 3 4 3 3 3 4 3 4 0.32 0.24 0.15 0.32 0.21 0.32 0.12 0.06 0.03 0.2 0.06 0.09 Ratings Weighted Scores

External Factor Evaluation

Key Strategic Factors Weights Opportunities Raw Material Availability Market Capitalization Diversification Exports Haleeb Bottle Credit Policy Joint Ventures New Entrants Sales Tax Changing Season Suppliers Economic Conditions Price Sensitive People Gawala Milk Small Target Market Total 0.1 0.08 0.07 0.07 0.04 0.06 0.06 Threats 0.08 0.05 0.06 0.07 0.05 0.06 0.1 0.05 1 3 2 3 3 2 2 4 2 0.24 0.1 0.18 0.21 0.1 0.12 0.4 0.1 2.78 4 3 2 3 1 2 3 0.4 0.24 0.14 0.21 0.04 0.12 0.18 Ratings Weighted Scores

Competitive Profile Matrix (CPM)

Critical Success Factors 1 Research & Development 2 Advertisement 3 4 5 6 7 8 9 10 Financial Position Market Share Product Quality Price Competitiveness Management Global Expansion Customer service Weight 0.08 0.09 0.09 0.07 0.08 0.11 0.10 0.08 0.06 Rating 3 3 3 2 3 3 3 3 3 3 Score 0.24 0.24 0.27 0.14 0.24 0.33 0.30 0.24 0.18 0.27 Rating 3 4 3 4 3 3 4 4 3 4 Score 0.24 0.36 0.27 0.28 0.24 0.24 0.40 0.32 0.18 0.36 Rating 4 3 3 3 3 2 3 3 2 3 Score 0.32 0.27 0.27 0.21 0.24 0.22 0.30 0.24 0.12 0.27

Sales And Distribution 0.09 Network Production Capacity Alliances Total 0.07 0.08 1.0

11 12

2 3

0.14 0.24 2.76

3 4

0.21 0.32 3.51

4 3

0.28 0.24 2.98

WAQAS AZIZ

KEY SUCCESS FACTORS

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

SPACE MATRIX

SPACE MATRIX

SPACE MATRIX

SPACE MATRIX

our company should pursue an aggressive strategy. Our company has a strong competitive position it the market with rapid growth. It needs to use its internal strengths to develop a market penetration and market development strategy.

BCG Matrix Model

Percent Division Revenues Revenues Profits Percent Profits Percent Market Value Percent Growth Rate

Olpers

$4500

49.90% 24.87% 31.21% 100%

$2000 $1500 $1305 4805

41.62% 31.21% 27.18% 100%

60 25 35 ..

+8 -6 +4 ..

Olwell TVC $2550 Tarang Total = $3200 $10250

Division wise data for Engro foods BCG Matrix

Internal External (IE)Matrix

Internal External (IE)Matrix

Score from the EFE matrix -2.75- this score is plotted on the y-axis Score from the IFE matrix -2.83- plotted on the x-axis As blue lines indicate This IE matrix for Engro foods tells us that our company should hold and maintain its position. The company should pursue strategies focused on increasing market penetration and product development

Grand Strategy Matrix for Engro foods

QSPM Matrix OF Engro foods

QSPM Matrix OF Engro foods

we came to a conclusion that Expansion internally a is a better option. This is given by the Sum Total Attractiveness Score figure. The expansion strategy yields higher score than the acquiring of competing company. The acquisition strategy has a score of 2.75 in the QSPM shown above whereas the internal expansion strategy has a smaller score of 2.78

ALMAS OMER

FINANCIAL RATIO ANALYSIS

Liquidity Ratios

Leverage Ratios

Activity Ratios

Profitability Ratios

SUGGESTIONS
The co-ordination between different departments of EFL should be improved it will lessen the bureaucratic cost and increase the efficiency of the company. The activities like customer satisfaction day should be performed on regular basis so the company should know the feedback and satisfaction level of customers regarding the product and the image of the company. The shopkeeper complains that EFL is not providing replacement for the expired products, EFL should provide proper replacement to the shopkeeper to enhance the image of the company, and create better working relations with such an important stakeholders. EFL has shifted to branding concept but it really has not adopted it fully, for smoother working of the different brands, the sales teams should merged with respective brand management. There is no check on the performance of the distributor, and this has led to huge problems in the delivery of many products in some areas of the city

SUGGESTIONS
They should also start to manufacture powder milk in order to meet the domestic demand Explore the market potential in a way, so that it can utilize its full capacity in order to gain economies of scale in the production. Develop the MKT program that distinguishes the characteristics of existing available substitutes to their highly quality & hygiene oriented product. Develop an integrated awareness plan in order to aware the people about the quality of the UHT milk as compared to other pasteurized or loose/fresh milk.

THANKS

"Whatever you can do, or dream you can, begin it. Boldness has genius, magic, and power in it." --Johann Wolfgang Von Goethe