1.0 Executive Executive Summary Summary The amount of water in the world is limited. Although water covers about two-thirds of the Earth’s surface, most is too salty to drink. In fact, less than . 0! of the water on our "lanet is available to humans. Today, a shortage of drinkable water is a serious concern and the scenario is very worst in the #haka and the main cities in $angladesh. That’s why these cities are very "otential for o"erating bottled water business. There is a saying, %life is the name of water&. $ased on the study it is seen that most of the "eo"le want crystal clear water for drinking as basic need. Totally Totally "ure and hygienic 'uality drinking water is a basic need for "eo"le, "articularly the urban and sub-urban sector in $angladesh. To "rovide the "eo"le with safe and "ure drinking water (eghna )rou" started "roducing *u"e *u"err +resh esh #rin #rinki king ng ater ater in 00 00 ml and and 00 00 ml bott bottle le.. (ost (ost of the the consum consumer er always always "refe "referr and seek seek reason reasonabl able e "rice "rice for good good 'ualit 'uality y that that +/E* serves to the consumers. It is being distributed nationwide by (eghna )rou" as well as their own distributor network. +or the "ackaging of their "roduct they use 1ET 21olyethylene Tere"hthalate3 bottle which is a "ackage for food food and non-fo non-food od "rodu "roducts cts becaus because e it is ine4"e ine4"ensi nsive, ve, light light weight weight,, resalable, shatter resistant and recyclable. recyclable.
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2.0
Situation Analysis 2.1
Market Su Summary:
The tradition of bottled water and mineral water is not very old. Even in western countries the "ractice of bottled drinking water started only in 60s. *ince ancient time "eo"le have used water from mineral s"rings, es"eciall es"ecially y hot s"rings, for bathing bathing due to its su""osed thera"eutic thera"eutic value for rheum rheumati atism, sm, arthri arthritis tis,, skin skin diseas diseases, es, and variou various s other other ailme ailments nts.. #e"ending on the tem"erature of the weather, the location, the altitude, and the climate at the s"ring, it could be used to cure di7erent ailments. This started the trend of using mineral water for drinking "ur"oses in order to e4"loit its thera"eutic value. *ince mid680s large 'uantities of bott bottle led d wate waterr from from mine minera rall s"ri s"ring ngs s in +ranc rance e and and othe otherr Eur Euro"ea o"ean n countries began to be e4"orted. The conce"t of bottled water is relatively successful in western countries due to greater health consciousness. The international standards regarding regarding bottled water are so stringent that for a "art "artic icul ular ar bran brand d of wate waterr to be cert certi9 i9ed ed as bott bottle led d wate water, r, in most most countries, multi"le levels of a""rovals are re'uired. +or e4am"le, in the :nited *tates, the E1A 2Environment 1rotection Agency3 regulates "ublic water systems. The +#A of :* has also set standards for bottled water. water.
2.2
SWOT ANALS!S:
*;T *;T mean means s *tr *trengt ength, h, eakn eaknes ess, s, ;""o ;""ort rtun unit ity, y, and and Thr Threat eat for for a com"any. com"any. Among these com"onents, strengths and a nd weakness are a re internal fact factor ors< s< o""o o""ort rtun unit ity y and and thr threats eats are are the the e4ter 4terna nall fact factor ors s for for an 1age 5 =
organi>ation. $ellow we analy>e *;T for "#ES$ natural %rinkin& 'ater?
!nter nal Weakn ess
Stren& t(
$rand name of the com"any ;ne of the (arket leaders in $angladesh Automated (achineries *trong #istribution Bhannel
eak in T Bommercial
*ources of /aw ater
Cack of (arket /esearch
Cack of /esearch
T(reat s
O))ortu nity Im"rove the Technology
Cack of su""ly of 1ure #rinking water To be a 1ublic limited Bom"any
ater /esources ;ver e4"loited
Economic Brisis of $angladesh
Anti-$ottling 1rotest
Extern al
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SWOT ANALS!S
Stren&t(s:
*ran% name o+ t(e com)any: *:1E/ +/E* natural drinking water
is one of the familiar bottle water com"anies name in $angladesh. If "eo"le think about bottle water in $angladesh, instantly the name +/E* comes in their mind. This is one of the real strength for the com"any.
One o+ t(e Market lea%ers in *an&la%es(: +/E* ater Bom"any
is currently ca"turing =0! to @0! market of water industry. *o it is easy for the com"any to dominate the market and increase the domination.
Automate% Mac(ineries: All the "lant of +/E* ater is com"letely
automated and com"uteri>ed. *o they can maintain the 'uality very easily where many other com"anies are "artially running manually and cannot maintain the 'uality.
Stron&
,istri-ution
(annel:
(eghna
)rou"
has
a
strong
distribution channel. *o +/E* water can easily reach to mass "eo"le.
!SO erti/e% +or uality: +or maintaining the 'uality over time
+/E* ater gets I*;-600?=000. This hel"s the com"any to be reliable to general "eo"le. 1age 5 D
Ex)ert Mana&ers: The brand manager of +/E* ater is an
e4"erienced "erson on the 9eld of marketing of these kinds "roduct in $angladesh. +/E* has some other managers who can "rovide right direction to the com"any.
Weakness:
Weak in T ommercial: The advertisement fre'uency on television
of +/E* ater is very low.
Sources o+ #a' Water: +/E* are currently "ull raw water from
000 feet dee" tube-well in their factory. $ut it is not well enough
sources for raw water of the com"any. Lack o+ Market #esearc(: +/E* are not continuously trying to know the customers demand on now days. *o they cannot take much more com"etitive advantage.
Lack
o+
#esearc(
an%
,evelo)ment:
The
research
and
develo"ment de"artment of +/E* is very weak.
O))ortunity:
!m)rove t(e Tec(nolo&y: +/E* has a great chance to im"rove their
technology more and take more com"etitive advantages over its com"etitors. 1age 5
Lack o+ ure ,rinkin& Water: e know that there is a huge scarcity
of "ure drinking water in $angladesh. +/E* has the o""ortunity to take this chance and increase their market range.
To -e a u-lic Limite% om)any: (eghna )rou" is a "rivate
com"any. ow they are "lanning to be listed in #*E and draw ca"ital from stock market. $y investing this ca"ital they can "romote the com"any.
T(reats:
Water #esources Over3Ex)loite%: The maFority of the bottling
"lants are de"endent on groundwater. They create huge water stress in the areas where they o"erate because groundwater is also the main source - in most "laces the only source - of drinking water in $angladesh. This has created huge conGict between the community and the bottling "lants.
Economic risis o+ *an&la%es(: $angladesh is not a rich country.
The country’s current economic condition is not favorable for smooth business. *o it can also be a great threat for the com"any.
Anti3*ottlin& rotest: )lobally, bottled water accounts for as many
as . million tons of "lastic waste annually. In addition, billions of bottles end u" in the ground every year. ;nly =0! ever get recycled, and the other 0! besides land9lls, many bottles end u" in oceans,
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"osing a risk to marine life. *o environmentalists may "rotest against this bottle "ollution.
$ealt( !ssue3 urity o+ *ottle Water: In $angladesh, many bottle
water com"anies lost their re"utation for having contaminated water. *o water com"anies are losing the trust of mass "eo"le.
2.4 om)etition: The re"orts on industry market share among the various mineral water manufacturers in $angladesh are mostly inconclusive. $y one account, H0! "ercent of the market share belongs to (um and +resh with (um having the u""er hand in terms of market share over +resh. According to the ocials of +resh, on the hand, they su""osedly are the second market leaders with more than ==! "ercent of the market share with (um coming in at 9rst with a =H! share. In any case, it can be stated that +resh and (um are the dominant forces in the market with a combined market share of more than 0! when there are actually more than 0 large com"anies with enough resources to "ut u" a challenge. ;ne reason why +resh has managed to gain an advantage in the market is due to their early entry. They were one of the "ioneers of the mineral water industry in $angladesh and managed to ca"ture a large "ortion of the market before anyone else could "ose a challenge. The late 60s and early new millennium saw a host of com"anies enter this once booming industry. (any large conglomerates have introduced their own mineral water brand and now, a"art from (um and +resh, it is hard to di7erentiate in terms of features, between the other brands. A'ua9na, *"a and Acme are the other brands which feature in the to" ranks followed by 1ran and Jibon. 1age 5 8
2.5
ro%uct O6erin&s:
*:1E/ +/E* $rand drinking water has become a leader in drinking water market for its su"er 'uality. In order to meet and ease the huge demand of "ure drinking water in the country, (eghna )rou" of Industries has set u" a high ca"acity drinking water "roducing "lant in its (eghna Industrial 1ark The "lant is one of the largest "lants engaged in "roducing drinking water in the country. $usiness unit was founded in 66 but factory was established for +/E* in =00 The "lant is engineered by )erman s"ecialists and e'ui""ed with state of art water treatment "lants. (anufacturing unit is e'ui""ed with modern machineries and technical ca"abilities in "rocessing and maintaining good manufacturing "ractice 2).(.13. The "lant follows a strict 'uality "olicy as "er I*;-600?=;;;. (odern 9ltration system ensures all essential minerals in water. The total "rocess concentrates on the followings,
#a' 'ater +rom %ee) tu-e 7'ell: e are collecting raw water from
land under 000 feet by dee" tube-well. Ox %ental to'er: Its absorbing o4ygen with water. #a' 'ater stora&e tank 'it( %osin& )um): 1rimary disinfecting if
"um" head is contaminated through e4ternal e4"osed. Activate% car-on /ltrations: To neutrali>e and remove dissolved
iron and odor if any. Multime%ia )rocessin&: To remove all sus"ended "articles, water
goes through various mesh si>es including anthracite media. ,ual 'ater so+tenin&: Through iron e4change removing of calcium
and magnesium or acids to regulate "h level. #everse Osmosis 8#O9: /o is a means for se"arating dissolved solids including arsenic from water molecules.
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Ooniation: +urther killing and "rotecting any growth of bacteria if
there is any. ;ltraviolet #ay Treatment: It’s an anti-contamination system. Mineral !n
only be done once the water is demateriali>ed com"letely and all dissolved to4ic substance is removed.
To ensure the regular su""ly of hygienic K high 'uality 1ET bottle for the industry and also to com"ensate both local K foreign need, the new venture of ()I is #haka 1lastic $ottle 21ET3 Industries Ctd. There are some other s"eci9c "roduct o7erings? ack sie
: Citer, Citer, @ Citer, = Citer, . Citer, Citer, 00 ml, =0
ml and 6 Citer acka&in&
: There are two stages of "ackaging. rimary acka&in&3 21olyethylene Tere"hthalate3 Secon%ary )acka&in& 7 A tray made of corrugated "a"er
contains = bottles which is covered by shrink wra". urity
:
(odern 9ltration system ensures all essential minerals in
water Nutrition
:
Balcium- @ mgLCtr, T#*-=0 mgLCtr, *odium-DmgLCtr,
+loried-.0 mgLCtr, Bhloride- =0mgLCtr, itrate- =.mgLCt , o (ercury, o Arsenic S(el+ li+e
: ;ne year. 1age 5 6
La-elin&
: Attractive bluish label including all necessary information are
com"osed.
2.=
,istri-ution:
#etail Market 7 *:1E/ +/E* distributes the "roduct through
retailers, like?
)rocery sho"s, Tea stall,
Bonfectionary,
+ast foods,
*weet sho"s,
)eneral restaurant,
$us-train-launch terminals etc.
!nstitutional Market 7 *:1E/ +/E* distributes the "roduct through
institutions, like?
os"itals,
Blinics,
Bhinese restaurant,
Bafeteria,
Cu4ury otels, 1age 5 0
)ovt. K "rivate oces,
$anks and Insurance,
;ce of di7erent ministers,
1arliament,
: $odies and );s,
ational K International Air *ervices,
E1M etc.
Event Mana&ement om)anies3
There are a lot of event management com"anies in our countries. They are managing di7erent ty"es of event around the country all the yearlong. In all of the occasions they need a lot of bottled water. *:1E/ +/E* are contracting with those com"anies to sell their "roduct.
4.0 Marketin& Strate&y 4.1 O-
"ositioning of the "roduct. ere has also the aims to blend the marketing mi4 in "ro"er way and set an ecient marketing strategies
4.2 Tar&et Markets: The target market for *u"er +resh drinking water is the demogra"hics of middle and higher class. It meant that only "eo"le with money to a7ord to go out on a regular basis would drink this. +/E* have some targets markets like?
;ut of ome Bonsumer
;cials in Bor"orate oce
#i7erent )overnment and 1rivate Institution
otel K /esort
os"itals and Blinic
*"orts events
;rgani>ation K ousehold
Tourism 1laces, etc.
4.4 ositionin&: +/E* atural #rinking ater was founded in =00. It has become as one of the leader in drinking water market for its su"er 'uality. In order to meet and ease the huge demand of "ure drinking water in the country, (eghna )rou" of Industries has set u" a high ca"acity drinking water "roducing "lant in its (eghna Industrial 1ark. The "lant is one of the largest "lants engaged in "roducing drinking water in the country.
Market Se&mentation
There are available forms of drinking water. +irst is the A*A ta" water that is boiled to "urify in households. *econd is the =0 liters container that is 1age 5 =
commonly referred as +ilter water. Third is the well "uri9ed and "ackaged mineral water. The cost and convenience "rovided by A*A cannot be held as a viable market for mineral water "roducers. As a result, +/E* atural #rinking ater focuses mainly on the conscious citi>en of the main cities.
ro%uct ,i6erentiation
The industry of mineral water is 'uite standardi>ed. (ineral water cannot be di7erentiated much as it is basically "uri9ed water with added minerals. Taste of mineral water varies from one another and "erha"s this is the only thing other than "rice that is greatly "erceived by consumers. +/E* atural #rinking ater "rovides su"erior 'uality in terms of com"lete "roduction "rocess and standard
,istinctive om)etencies
+/E* atural #rinking ater tries to build #istinctive Bom"etencies to create a greater value for the "roduct than that of its rivals. Tangible resources and Ba"abilities hel" +/E* achieve the "osition where it wants to "lace itself.
E>ciency ? The "lant +/E* uses is engineered by )erman s"ecialists
and e'ui""ed with state-of-art water treatment "lants. (oreover, (eghna )rou" of Industries is both hori>ontally and vertically integrated so that most of the materials become cost e7ective.
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uality ? +/E* atural #rinking ater e4tracts raw water from dee"
tube-well and uses activated carbon 9ltrations, /everse ;smosis, ;>oni>ation, etc. and maintain I*;-600?=000 standard.
!nnovation? There is nothing much to im"rove in terms of "roduct
develo"ment unless the /K# discovers a way to better the taste of water. owever, innovation is used to create the "erfect value-chain activities or "romotional activities.
ustomer #es)onsiveness? (ineral water cannot be di7erentiated
like other consumer "roducts. $ut +/E* constantly tries to im"rove its distribution in res"onse to customer demand. Intangible asset, such as $rand name, em"loyee skills, etc. are of great value to +/E*. +/E* has been serving the market for more than years and that had given it a strong foothold in the market. +/E* has its own goodwill now, other the fact, the business belongs to one of the largest and most re"uted grou" of industries, (eghna.
4.5
Strate&ies: ro%uct? ricin&? ,istri-ution? Marketin&
ommunications: (arketing decisions generally fall into the following four controllable categories. *u"er +resh atural drinking water brand is trying to do these tasks successfully.
1roduct
1rice
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#istribution 21lace3
(arketing Bommunications 21romotion3
ro%uct:
+/E* ater comes under the category of Bonvenience 1roduct that it is bought on daily basis. It will be used by most of the conscious "eo"le because of its chea" rate, its "ure taste and e4cellent 'uality. *o +resh tries its best to let the consumers to buy it with warranty of its "urity and taste. +/E* ater falls under the category of "rocessed material. The water is e4tracted and then "uri9ed with the modern e'ui"ment’s without the use of any harsh chemical that can be dangerous to their customers health above is shown the modern and latest e'ui"ment are using that is the basic "art of +/E* ater’s "lant. The attractive bottle, its clean color of water and its "ure taste will ful9ll the need of their customer. They kee" obFective in their mind that is to satisfy the customers in every as"ect of the "roduct’s nature.
rice:
+/E* Gows a Ge4ible "ricing strategy. They are "artially following "rice signaling strategy. They are cutting "rice as follows? o o o o o o
00 (C 1et bottles- tk Citer 1et bottles- =0tk . Citer 1et bottles-=tk = Citer 1et bottles- @0tk @ Citer 1et bottles- @tk Citer 1et bottles- 80tk
They basically set the "rice by looking their customer’s a7ordability. In $angladesh they cannot charge too much for water. *o to kee" the low "rice 1age 5
from customer +/E* try to kee" their "roduction cost low and increase the sales volume.
,istri-ution 8lace9:
$ottle water is a convenience "roduct. *o the com"any ensures that their "roduct will be available near to mass "eo"le. +/E* have some targets markets locations like?
/ailway *tations
$us *tation
os"itals cafeteria
Tourism 1laces
:niversities and Bollege
Each and every general store etc.
The marketing managers of +/E* ater ensured that their "roduct is accessible any location of $angladesh. (eghna )rou" has a lot of distributors around the country. Through their distributor and sales "ersonnel they ensured their "roduct "lacement.
Marketin& ommunications 8romotion9:
ow a day’s "romotion is an essential task for each and every "roduct. To com"ete in this com"etitive business arena +/E* are also doing some "romotional work. They have very several television commercial. In recent +/E* ater, contracts with $angladesh Bricket $oard to su""ly water to their "layers, ocials and in the all events. They also contract with di7erent hotels and institution for su""lying water
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4.= Marketin& Mix: It is a set of controllable tactical marketing tools- 1roduct, 1lace, 1rice and 1romotion- that the 9rm blends to "roduce the res"onse it wants from the target market. The (arketing (i4 are as follows?
Marketin& Mix
ro%uct
lace
- Nuality
3 /ailway *tations
- 1acket #esign
3 Tourism 1laces Tar&et Market
- #i7erent *i>e
rice
3 Universities & College - Every general store
romotion
3 A7ordable to
3 T
all
advertisement
3 (/1
3 *ales
3#iscounts
1romotion 3 1ublic /elation 3 1artner with
$B$
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E7ective marketing would be blending the marketing mi4 elements into a coordinated "rogram designed to achieve the com"any’s marketing obFective by delivering value to consumers. +resh are trying best to blend these marketing mi4 elements to catch the most number of customer’s res"onse.
4.@ Marketin& #esearc(: +or setting an e7ective marketing strategy market research is very im"ortant. Through a successful marketing research we will get the idea of a marketing tactic. Sam)le an% Sie
To do the e7ective research we have to collect information from the di7erent "laces in the main cities of $angladesh. e will also collect information from di7erent ty"es of age grou", habitants etc. e will take information from about @000 "artici"ants. ollectin& !n+ormation
e will collect information on about the bene9ts of those consumers who are taking these mineral waters like (:(, *u"er +resh, AB(E, 1ran, Jibon, #uncan, Oinley etc. hether consumer "refers di7erent ty"es of "ack si>esP Are the consumers satis9ed about the 'uality of *u"er +reshP Ask about the habit and life style of the consumers who take mineral water. #oes advertising "lay a "ositive role to increase the awareness of their brandP Analyin& t(e in+ormation
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Analysis the above information from facts gathered and discussed with management to take a""ro"riate decision. Sources o+ ,ata
e will collect both "rimary and secondary data for marketing research. 1rimary data will be collected directly from the general "eo"le who will choose randomly from the di7erent cities of $angladesh. e will also collect information from di7erent agency and organi>ation which will be our secondary data. D.0
"inancial Analysis:
Average *ales (argin ;ne of the main reasons why +resh has been able to enFoy such a decent margin on sales is because they conduct a large "art of the value chain activities themselves. +or e4am"le, they manufacture their own bottles and ca"s at their manufacturing "lant. The only maFor raw materials they "rocure are the labels which are not feasible to "roduce in-house. ormally the sales margin varies overtime between 0! and ! due to the annual variation of market demand and the di7erent agreements the com"any has with their distributors. #istribution commission varies from H! and hence, de"ending on the s"read of sales units among various distributors, the sales margin is slightly inGuenced. ence on average the com"any gets the sales margin around 0!.
$reak-even Q = =00 000 units "er month
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The market demand for bottled water can vary from as low as . million units "er month to as high as million units based on the season. #uring the summer, the com"any faces over demand and has to "roduce at its ma4imum ca"acity level of million units "er month. At other times, es"ecially during the winter, demand is lower than that re'uired to breakeven.
=.0 ontrols =.1 !m)lementation: A great vision, even when combined with a solid strategic growth "lan, is only as good as your ability to get it im"lemented. A Bhief ;utsider, working as a "art time member of the management team, will ta" their decades of e4ecutive management e4"erience and knowledge and then "rovide access to the to" resources to get things done. The management will try to follow "ull strategy where s"ending a lot on adverting and consumer "romotion to build u" the consumer demand. If the strategy is successful, consumers will ask their retailers for the "roduct, the retailers will ask the wholesalers, and the wholesalers will ask the "roducers. They can also follow "ush strategy where the sales force and trade "romotion to "ush the "roduct through channels. The "roducer "romotes the "roduct to the wholesalers, the wholesalers to retailers, and the retailers "romote to consumers.
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=.2
Marketin& Or&aniation:
*u"er +resh ater follows two (arketing organisms to reach their "roduct to the end user. These are . ori>ontal (arketing *ystem, and =. ertical (arketing *ystem. $ut they are usually following ertical (arketing *ystem. As this case manufacturer and distributor act as a uni9ed system to reach the "roduct to the retailer for sale. +rom the factory manufacturer send the "roduct to their distributor, distributor delivers the "roducts to the retailer and at last consumer get the "roduct from the retailer.
@.0 onclusion: The bottled water industry in $angladesh is in the late growth stage and over time, the com"etition will get more and more com"etitive. It is essential for the e4isting com"anies to set an industry standard and build loyalty in order to hold on to their market share. (ore than anything else, they need to come forward and facilitate the framing of laws that can sto" unregistered and illegal businesses from taking advantage of the unregulated nature of the market. Together, they should raise awareness about low 'uality bottled water and reclaim the lost market segment of large water Fars. They should also try to build customer loyalty so that new com"anies are refrained from entering the business and e4isting com"anies can hold on to their res"ective market share. At "resent, few com"anies are "artici"ating in any marketing activities and even then, the magnitude is very limited. Bom"anies like +resh have been in this business for long and should know by now the ins and outs of this business. ith their e4"erience, they could consider e4"anding their business beyond national borders. India, Bhina, *ri Canka, (aldives, and 1age 5 =
other *outheast Asian countries could be considered for their business e4"ansion.
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