Haleeb Foods Limited Pakistan is the world’s fifth largest dairy industry in the world and cheaper than many developed countries in the world like Australia and America. So there is a tremendous amount of opportunity for firms to excel in this industry. Chaudhry Dairies limited is one of those who have entered the dairy industry of Pakistan and have posed serious threats to well established firms like Nestle. Chaudhary limited was incorporated in 1984 as a Public limited Company. It was established with the financial aid of PICIC (Pakistan Industrial Credit Credit and Invest Investmen mentt Corpor Corporati ation) on) and ADBP ADBP (Agri (Agricul cultur tural al Develop Developmen mentt Bank of Pakistan). The head office is situated at 135 Ferozepur Road; Lahore while the plant is situat situated ed at 62 km Lahore Lahore-Mu -Mult ltan an Road, Road, Bhai Pheru. Pheru. In keeping keeping with with the company's company's commitment towards product diversification and to provide a wide range of quality food products to their valued customers, the name of Chaudhry Dairies limited was changed to Haleeb Foods Limited with effect from February, 2004. Commercial production started in 1986 & the company reached its breakeven in the year 1992. Initially 150 people were employed at the plant. The liquid milk was the first product launched in the market, it started its operation in 1985 at that time 20 other dairy plants were also coming in, and all those including MILK PAK were using obsolete technology that was used in EUROPE. Haleeb plant was the only plant based on the latest technology and the basic idea behind that was providing consumer quality packaged food particularly dairy Foods products. Haleeb Haleeb Foods Foods Limite Limited d (Forme (Formerly rly CDL Foods Foods Limit Limited) ed) is one of the Pakist Pakistan an based based company with a burning passion to take on the international market. In the clutter of multinational the company has a distinguished and a prestigious place. The name of Haleeb foods limited is synonymous with best quality foods products.
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Mission Statement of Haleeb Foods “To build branded food business to improve quality of life by offering tasty, affordable and highly nutritional products to our consumers while maximizing share holder’s value”.
Vision Statement of Haleeb Foods Most innovative and fast growing food company offering products enjoyed in “every home every day”.
Values of the Company •
Enterprise
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Empowerment
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Accountability
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Trust
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Teamwork
MILESTONES MILESTONES ACHIEVED BY HALEEB FOODS LIMITED (CDL) •
HACCP (in process controls for safer products)
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ISO 9002 (better quality for greater customer satisfaction)
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ISO 14000 (environment-friendly operations)
TOTAL QUALITY MANAGEMENT (TQM) Haleeb Foods limited limited has established established TQM system system in 1994. Today's Today's business world is all about TQM and HFL has done it 12 years before. The company follows the philosophy of “delighting the customers ". The company treats them as partners and keep channel of commun communica icatio tion n open with them. them. The compan company y has succee succeeded ded in this this by contin continuous uously ly improving the quality of its products and by satisfying the needs of its customers. The
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company believes in creating and sustaining an environment, which encourages learning and empowerment and these in turn help strengthen the quality culture across the business. Haleeb Foods Limited has got the honor to launch sterilized milk for the first time in Pakistan. Also the credit for launching the milk in tetra fine packaging, for the first time in Pakistan, goes to Haleeb Foods Limited.
CURRENT SITUATION Haleeb Foods Functional Organization Structure Haleeb is a public limited company managed by a board of directors who has vested (to have the rights of ownership) the control of company operations to Managing Director (MD). Haleeb is an organization run by a team of professionals headed by a team of professionals. It has 17 departments successfully running their operations. The Functional Organization Structure has the following details: •
Chairman / Board of Directors
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Managing Director
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Human Resources (HRD)
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Accounts & Finance (A&F)
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Marketing (MKT)
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Sales (SAL)
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Supply Chain (SC)
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Operations (OPR)
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Quality Assurance (QAD)
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Research & Development (R&D)
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Finance Department
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Information System
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Technical Department
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ORGANIZATION CULTURE
Organizational culture is an idea in the field of Organizational studies and management which describes the psychology, attitudes, experiences, beliefs and values (personal and cultur cultural al values values)) of an organi organizat zation. ion. Organi Organizat zation ional al cultur culturee of Haleeb Haleeb Foods Foods Limite Limited d includes structures, policies and corporate culture. Company has a centralized centralized structure structure (Situati (Situation on in which decision-making decision-making Structure: Company power is at the top of an organization and there is little delegation of authority) all the decisions are made by the board of directors, heads of marketing, finance and production departments.
Policies: Company adheres (to stick) to strict policies, which are all directed towards Dairy product improvements and providing best nutritive value to its customers.
Culture: The way people talk, dress up and work determines the corporate culture of the company. Haleeb Foods Limited has a competitive culture, where strong values such as team work, empowerment and sharing of ideas are encouraged.
SITUATIONAL ANALYSIS HALEEB FOODS LIMITED is one of those those few leading national companies. It collects about eight hundred thousand liters of fresh milk everyday from its large number of collection points located all over Punjab, chills it at the site and processes to manufacture different products .
PRODUCT RANGE Haleeb Foods Limited is producing the quality products as per the standards of ISO & HACCP. Along with the quality products, Haleeb is also producing the wide range of the
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products including milk based products, juices, powder etc. The products can be divided into following ways
CONSUMER PRODUCTS
Products, which are branded and are a re sold to the end con sumer through a distribution chain in the packaged from as produced by the company. Consumer products are sold under following brand names 1) Dair Dairy y Prod Produc ucts ts
i. ii.
Nutrious Th Thick Mi Milk
iii.
Daizy Yogurt
iv.
Liquid Te Tea Wh Whitener
v.
Powder Tea Whitener
vi. vii. 2)
Daizy Butter
Daizy Cheese Asli Desi Ghee
UHT MILK
i.
Hal Haleeb eeb Nutr utrious ous Thic Thick k Mil Milk
ii.
Dairy Queen
iii.
Candy Up Up Fl Flavored Mi Milk
iv.
Skimz Li Liquid Mi Milk
v.
Skimz Powder Milk
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3)
Tropico:
i.
Tropico Ne Nectar
ii.
Good Day 100% Pure
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INDUSTRIAL PRODUCTS
Haleeb Skimmed milk Powder (SMP) was introduced in 1992. Apart from internal use, it is also sold as bulk products. Instant Full Cream Milk Powder (IFCMP) was introduced in 1996. Both products are sold in 25 kg bags. Excess milk fat is sold unprocessed to makers of butter, ice cream and sweeteners, or at request is turned into ghee. EXPORTS
CDL started exporting its products in 1999 and has done business with customers in Korea, Afghanistan and china, United Kingdom. The company is not only supplying products nation wide but also currently exporting its products to Afghanistan, Bangladesh, Europe and America. It exports Desi Ghee to to South Africa cream, milk milk and fruit juices Uk. Powdered milk and ghee to Qatar. It is also planning to export its products to Canada, Dubai and Uzbekistan. The Executives of Haleeb Foods claims that growth rate of Haleeb Foods PVT Limited is highest as compared to any other company in Pakistan. Its total sales grew immensely in last few years. It has given jobs to 2200 employees which includes skilled unskilled and temporaries. Its plants in Lahore 3-shift basis daily in which every shift lasts for eight hours that means the plant works 24 hours a day. As the company is making products on large scale, it produces a lot of waste as well which is being disposed in an efficient way in order to keep the environment health and clean as respect for the national Protection Laws. The company company is earning earning high profits profits and as a result result it is sponsoring sponsoring the welfare welfare of the children children as it runs about 600 schools in different parts of the company. It is one of the major tax payers as it claims to be very honest in tax assessments and paying of tax amounts set by the Government. The major secret of the success of the company is the practice of the Honesty in every field and on all frontiers that are expanding day by day. The company investor and management teams have unanimously decided since the start that there will be no compromise on quality of products. That is why it subjects milk to strict tests on the basis of which there is is a lot lot of reduction reduction in supply due to rejection rejection which is approximately more than 100,000 liters per day, a very big loss daily. The company bears this loss daily
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instead of selling in the market because they don’t want to compromise on quality. The compan company y admini administr strati ation on has taken taken keen intere interests sts in refini refining ng the enviro environme nment nt of its establishments and developed all of its sites at the highest aesthetic standards. It has a very attractive office at 135-Ferozpur Road Lahore and a beautiful food processing plant with amazing landscape 62 kilometers on Multan road. The plant is not only a production but also also has has a big big ware wareho hous use, e, a mosq mosque ue,, a fair fair pric pricee shop shop and and a gues guestt hous house. e. It has has commissioned a similar type of plant with a huge capacity in Rahim –Yaar- Khan.
Marketing Mix of Haleeb Foods
The marketing mix covers all the aspects which play an important role in the physical appearance, affordability and the way a product is placed in front of the consumer. It helps in building an image which would in the end help the company to capture huge market share.
Product
Product line is decided through consumer demand to get positive results. Haleeb Foods have adopted a customer driven approach and regularly conducts environment analysis to check consumer lifestyles, competitor’s products and advancements in technology. The Resear Research ch and Develo Developme pment nt Depart Departmen mentt conduct conductss opport opportuni unity ty analys analysis; is; checks checks gap in market segment and generates an idea. Price
Haleeb Foods are priced keeping in view the buying power of middle-income and highincome social classes. The cost includes the cost of manufacturing, labor, raw materials etc. Being a multinational brand, the pricing objective of Haleeb Foods is mainly to increase sales as it has already penetrated the market. Their prices are not affected by price changes by by compet competit itor ors, s, and and they they don’ don’tt engag engagee in pric pricee wars wars.. Comp Compet etit itio ion n is met met thro through ugh innovation. The prices of Haleeb Foods change as the product size is changed of the
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Product Life Cycle. And Because of the contract between the seller companies, they offer same price. They use pricing strategy on cost base method, to make there prices of different products. products. The retail retail prices prices are different different according to there size and brand. However prices have been been standar standardiz dized ed through throughout out Pakist Pakistan an and there there is no differ different entiat iation ion based based on geographical geographical areas. There is no change in prices according to season. season. It remains remains the same. Wholesale price is cheaper than the retail price because in wholesale the selling is in bulk. There is no discount and early cash payment policy in Haleeb foods. They adopt same strategy in international marketing as in local marketing. But the prices are according to the international currency. Promotion
Good Promotion always plays an important role in the success of any product. A good product can fail if it is not properly promoted. Haleeb Foods is taking big steps to promote it’s product by maintaining maintaining good relationsh relationship ip with the community community of Pakistan. Pakistan. Like other companies Haleeb is using different modes of media for advertising just like Newspapers, Telivision, Radio, Magazines, Newsletters, Internet, Brouchers etc.
Place
Place include three major areas that are Industrial, Shopping, Residential area. It is difficult for people to go to factory to get Haleeb’s products. Its products are available in shopping areas and residential areas. They distribute there products nationally and internationally through out the world. Haleeb Foods are distributed using an indirect channel, that is, dealers. They follow pushing strategy. In which firms in a distribution channel cooperate in marketing a product. It includes suppliers and retailers. Retailers take order from retail stores on daily basis and provide products according to order. There are two departments d epartments •
Raw material department
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Finished goods department
From the finished goods department the product goes to the warehouses.
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Haleeb Foods Company has four types of dealers •
Normal Dealers: Deals in Haleeb milk along w ith the other brands of company.
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Exclusive Dealers: Deal in Haleeb milk only
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Mega Dealers: Same as normal normal dealers but are offered extra trade discount due to high sales potential.
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Corporate Dealers: Handle institutional sales
COMPETITIVE ANALYSIS OF HALEEB FOODS SWOT ANALYSIS OF DAIRY INDUSTRY IN PAKISTAN STRENGTHS •
Endowed with the very good breed of buffaloes
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Highest per capita consumption of milk in association
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Regular culling of less productive animals
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A high ratio of agricultural land to cultural ratio
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An emergence of commercial dairy farms on a large scale
WEAKNESSES •
Small and scattered animal holding
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Prevalence of traditional raw milk marketing system
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Poor quality of milk
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Milk processing predominantly dependent on obsolete UHT technology
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Lack of access to well trained support service staff. OPPORTUNITIES
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Huge unsatisfied demand of milk and milk products
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Increase consumer awareness of healthy eating THREATS
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Inadequate public and private investment in modernization of sector
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Vested interests in perpetuating the dependence of imports in dairy products
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Unregulated imports of dairy products at cheap p rices
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PEST ANALYSIS OF HALEEB FOODS
It is very important that an organization considers its environment before beginning the proceedings. In fact, environmental analysis should be continuous and feed all aspects of planning. •
POLITICAL CONDITIONS
The political conditions are not very stable in the country, but this does not directly influence the trends and spending patterns of the customers. There are no restrictions or barriers on the growth of this industry. So the political conditions are favorable for this market because food and dairy products are consumer goods and they have to purchase it in any condition. •
ECONOMICAL CONDITIONS
The fluctuations in Pakistan economy also effect Haleeb’s market position. Because of high inflation and low purchasing power Haleeb is unable to capture many potential customers of the large Pakistani population who have to struggle hard to make their living possible rather than to afford the luxury of drinking packed milk as often as they would like to. SOCIAL CONDITIONS
The social patterns are changing in the country, as the world is becoming a global vill village age,, and and mutu mutual ally ly shar sharee and and acce accept pt patt patter erns ns.. Peopl Peoplee are are beco becomi ming ng more more attr attract activ ivee towa toward rdss the the bran branded ded produ product cts. s. It is beco becomi ming ng fash fashio ion n and and youn young g generations as well as the children are getting more attracted towards this industry. People are moving towards branded food/dairy products due to hygienic reason. TECHNOLOGICAL CONDITIONS
High technology is the basic requirement of dairy and food industry. The companies that are using latest technology have some cost benefits over the companies, which are not using high technology. Haleeb Foods Limited employs the latest machinery in production in its plants and computerized systems for quality checks and control as well as production. In milk industry the most latest technology is in operation in
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Pakistan hence no competitor poses a threat to Haleeb on basis of technology. Their Ultra High Temperature is a technology which maintains the quality of their milk and at the same time provides thickness. SWOT ANALYSIS OF HALEEB FOODS STRENGTHS •
Highly sophisticated plant and equipment
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Qualified work force
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Focus on research and development
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First and the only dairy company in Pakistan to get ISO 90 02 Certification
WEAKNESSES •
Low promotional activities
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Comparatively weak distribution system
OPPORTUNITIES •
Haleeb Foods Limited can export food items especially Juices to Middle East
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CDL Foods limited has been changed to Haleeb Foods Limited, so this change in name can help them to attract foreign customers.
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Haleeb Foods Limited can go for related diversification by producing pure juices and flavored yoghurt.
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Haleeb Foods Limited can go for joint venture with other companies to attract the market share.
THREATS •
Strong competitors i.e. Nestle, Engro Foods
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Price sensitive people
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Milk men (Gawalas) providing non branded milk in homes
COMPETTIVE ANALYSIS OF HALEEB FOODS
Haleeb Foods competitors in the dairy industry are mainly Nestle and Engro Foods. Nestle a Switzerland based company has been serving Pakistani consumer since 1988 when it first acquired the shares in Milk Pak. Nestle with is offering the following products in dairy line Milkpak, Nesvita, Nido, Nestlac, Everyday, Nestle Dahi, Nestle Fruit Yogurt, Nestle Raita and Milk Pak Cream. From the product line it is clear that why Nestle is the market leader grabbing 44% of the market share. The major contributors of Nestle success are HR, Market Marketing ing and Sales Sales Departm Department ent.. The major major contri contribut butor or is its approp appropria riate te strate strategy gy particularly its relationship with the social and environmental sectors. Perhaps this is the reason that in spite of being a multinational has been well accepted in Pakistan. There are ample chances for its survival in the future. future. Engro foods established established in 2004 are nicely on its way to grab a handsome portion of market share. Engro is all about people who are a part of them their culture is dynamic and energetic with emphasis on core values and loyalty of employees. It has got 10% of the market share in dairy industry of Pakistan. Top Quality brands like Olpers, Olwell, Tarang, Omore and Owsum have been successfully launched under the helm of company’s dairy products. products. Haleeb Foods have grabbed 38% of the market share with annual turnover of 10 billion annually and it has posed serious threats to the Nestle Dairy product line. The remaining share of the market has been with the small competitors and Gawallas providing non branded milk in the dairy industry of Pakistan. Why Nestle Dairy Products are Market Leaders? •
Keep Keepin ing g new new play player erss like like Olpe Olpers rs and and old old ones ones like like Hale Haleeb eb Nest Nestle le emphasized more on advertising
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Nestle have been experiencing a constant increase in cost with raw materials contributing the larger part of its incease. Haleeb having their own suppliers so the raw material cost is bit too low.
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•
Nestle maintained its value of gross profit nearly or above 30% to ensure that it has strong strong control over its costs and efficiency efficiency of production. production. But on the other hand Haleeb faced a bit of downfall when OLPERS introduced their campaigns.
BCG Matrix
Haleeb milk is categorized as a star in the Haleeb Foods Limited product line as it brings the most in terms of revenues to Haleeb Foods Limited. It has been most productive for Haleeb Foods Limited since their operations.Haleeb Milk has grabed more than 54% of the mark market et shar share. e. But But they they must must inve invest st more more in it to make make it more more prof profit itabl ablee as toug tough h competitors like OLPERS and Milk Pak are still in competition and trying to grab a handsome portion. Skimmz Powder Milk and Daizy Yogurt are having proved to be dogs in product line of Haleeb Foods. Nestle Dahi and Nestle Fruit Yogurt is nicely dominating Daizy Yogurt and Skimmz Powder Milk hasn’t met the destination where Haleeb Foods Limited would have hoped in Pakistan.
ADVERTISEMENT ISSUES OF HALEEB FOODS LIMITED
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With the arrival of ENGRO FOODS in dairy industry of Pakistan, it has caused serious concerns to Haleeb Foods with respect to competition in markets of Pakistan. Haleeb Milk which is ranked as a STAR in the product line of Haleeb Foods has been seriously challenged challenged by the the aggress aggressive ive
advertiseme advertisement nt campaig campaigns ns of OlPERS. OlPERS. Haleeb Haleeb Milk sales
have been seriously threatened in one of the huge cities of Pakistan like Karachi by Olpers. In fact, sales of Haleeb Milk are more in Lahore than Karachi, which shows the nature of threats that have been posed by Olpers to seasoned players like Haleeb Milk in dairy industry. As discussed earlier, when Olpers was launched they aggressively advertised themselves. Generally, women select the brand of milk that suits their children or for the regular use in homes of Pakistan. It is the nature of women that they are attracted towards someth something ing more more quickl quickly y than than men. men. That That is where where OLPERS OLPERS outsma outsmarte rted d the seasone seasoned d competitors by advertising aggressively between 3.00 PM to 5.00 PM and from 8.00 PM to 9.00 PM, as this is the time when most women switch to television and that is the time when Olpers imposed itself in the mind of Pakistani women who generally make decisions which brand of milk to use or not. This is where Haleeb Foods is perhaps lagging behind other dairy industry competitors. It has been proved through research that Olpers have advertised advertised itself 60% more than Haleeb milk. Good Promotion Promotion always plays an important important role in the success of any product. A good product can fail if it is not properly promoted. There are serious concerns about the advertisement of Haleeb Milk for me. They have really limited the use of their product through their own advertisement by saying “CHAYE BANAYE KHOOB HALEEB”. There are serious concerns for me they are themselves saying that their milk is only tea purpose through this campaign, so what about drinking HALEEB MILK. Is it harmful to drink HALEEB Milk? If we closely look at the ads of Olpers Olpers or even Milk Pak they show various uses of their milk in one add. In, Olpers latest advertisement we see that they have shown an old man and a child drinking the milk. It shows that their milk is suited for old people as well as young generation of Pakistan. They obviously show that it is good for making tea but also show its usefulness in making sweet dishes dishes through through their their advert advertise isement ment.. For me ENGRO ENGRO FOODS FOODS has beauti beautiful fully ly read read the lifestyle of large population of Pakistan. They have shown five or six uses of their milk in one advertisement. Would you like to buy a product that has one use or six uses? So, where
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is Haleeb FOODS thinking tank? They have themselves limited the use of their product. That is one of the flaws in HALEEB FOODS advertising. Another thing as far as their advertisement is that for at least past five or six years they were having “SADIA IMAM” in their advertisement except their last last advertisement. Whereas, ENGRO FOODS has come up with most attractive and gorgeous models of Pakistan in their advertisements. In the the recen recentt adver adverti tise seme ment nt of HALE HALEEB EB FOOD FOODS S they they have have come come up with with old old ZEBA ZEBA BAKHTIAR and SHAAN. People are more attracted towards fresh gorgeous faces rather than old beautiful faces. So, selection of somebody who is representing your brand is also very important. We also see in the advertisement of our neighbor country that Katrina Kaif is the brand ambassador of most famous brands of India (16 to be precise). It is not that she is most beautiful but because she is most liked, famous and most demanded at present times. So, you need somebody who is most popular, liked and most demanded at present time to make your advertisement most attractive. That is also a field where OLPERS has outsmarted Haleeb Milk to grab a good potion of market share in the recent years. Frequent and timely advertisement is something that is concern to entire HALEEB FOODS LTD not only to their milk. There is no proper portfolio management of Haleeb Foods as they have a number of products in which they are operating. There are still a large number of products that have not advertised yet and hardly anyone is aware that they are launched or available in the market. People don’t know about the most of the products of HALEEB FOODS LIMITE LIMITED D like like DAIZY DAIZY CHEEZ, CHEEZ, DAIZY DAIZY YOGURT YOGURT,, SKIMMZ SKIMMZ POWDER POWDER MILK MILK and SKIMMZ liquid milk. So how can you succeed if people don’t know that your products are available in the market? There is no awareness campaigns by HALEEB FOODS as they are pioneers of UHT Milk concept, ISO certified company, 10 billions of annual turnover and serving since 26 years. There is no cross merchandise promotion(Retail promotion(Retail selling technique in which purchase which purchase of one item allows an automatic discount on a different but related product related product)) as far as HALEEB FOODS is concerned. Firms like nestle has nicely adopted this strategy. HALLEB FOODS LIMITED hasn’t also done a lot to improve relationship marketing approach. So, proper marketing of the product line of HALEEB FOODS LIMITED is the need of the hour to stay up with the competition. competition. HALEEB HALEEB FOODS really need to change itself because those who don’t change with the passage of time have fates like SHAMANO
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CYCLES. CYCLES. You can’t succeed in the prevailing prevailing ruthless ruthless competition competition without without staying staying ahead of competition. OTHER CHALLENGES FACED BY HALEEB FOODS LIMITED •
Centralized decision making
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No proper strategy formulation and lack of strategy implementation plan
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No sales on credit
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Baised view of consumer due to haleebs thickness
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More focusing on exports as there is large opportunity o pportunity in local market
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Conutless departments and all have separate departments.
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