Report, Pages 7 (1514 words)
Current Size, Growth and Profitability
Recently, Haleeb Foods has reached a turnover of Rs. 9. 2 Billion in the year 2009. It was a loss, though, as Haleeb Foods has been experiencing a slump since 2-3 years due to internal management and quality issues. Competition may pose a threat because the company will have to maintain its leadership in an expanding market so that it doesn’t lose its market share to its competitors. For Haleeb it might be difficult to maintain its market hare in a market where the loyalties exist for such brands as Nestle and Olper’s.
These brands have been in the milk industry and have left a mark in the minds of consumers in terms of quality. Competition seems to be getting tougher as a result of new players entering the dairy market. Haleeb’s primary competitors are Nestle milk pack and Olper’s milk. The Secondary competitors are Nirala, Halla, Good milk and Gourmet milk.
Prema milk – fresh, pure and nourishing, straight from our own state-of-the-art dairy farms.
With the combination of natural vitamins, minerals, and a great creamy taste, Prema milk provides truly natural milk, with all the essential nutrients needed for healthy bodies and bones, including rotein, calcium, riboflavin and vitamin A. As an all purpose milk, Prema milk is perfect for the whole family for drinking, cooking, as well as a tasty tea whitener. Prema has a market share of 20%.
Launched on March 20, 2006, Olper’s milk is EFL’s standardized and homogenized pure UHT (Ultra heat treated) milk with 3.
5 % fat and 8. 9 % solid non-fats. It is EFL’s premier brand, and the choice of quality-conscious consumers who only go for the best. It is available in easy-to-open, 6-layered Tetra Pak Brick Aseptic red packaging and comes with a 3 months shelf life. Olper’s has a market share of 20%.
Nestle Milk Pack
Pure, rich and delicious NESTLE MILKPAK standardized UHT milk benefits from Nestle’s expertise in bringing you the very best life has to offer and benefits from 140 years of consumer trust. It comes in four convenient packages and provides a nutritious value to its consumers by educating them about the advantages of milk.
They provide valuable information on the packaging and advertise how Nestle milk provides all the essential nutrients. In another words they keep in track of the changing trends and the change in consumer preferences. The market share for Nestle milk pack is 30%. Secondary Competitors: Nurpur, Nirala, Good milk and Gourmet milk altogether comprise of about 10. 5% of the total market share.
- Ultra-Modern technology: Haleeb Foods is using a high-tech modern UHT plant known as “Tubular Heat Exchange System” in which there are closed pipes of hot and cold water which treat the milk at the time. In this process, the milk is first revolved around the hot pipe which raises the temperature to about 140*C to kill bacteria and other germs and then around the cold pipe which lowers the temperature to around 2-3*C. This process gives the milk its natural thickness and taste. Whereas its competitors use “Heat Injection System” in which steam is injected into the milk to kill the bacteria and then cooled down
- The Brand “Haleeb”: Haleeb is one of the oldest UHT Milk providers of Pakistan and has developed its name through out the country. Every person, whether it be a child or an adult or an elderly, knows about this name and would prefer buying Haleeb Milk rather than any other new ones. It is using the ‘corporate brand strategy’ i. e. making use of the corporate image to affect customer purchase decisions. Examples are Haleeb yoghurt, Haleeb butter, Haleeb milk. Here what is important is not only the reputation of the company but also the concept of customer loyalty to the brand.
- Owning the color “Blue”: Haleeb from the very beginning has identified and associated itself with the color Blue. Every time a person enters a grocery shop and sees a blue pack on the milk shelf, he/she instantly recalls the brand as Haleeb which gives it a competitive edge over its competitors such as Olper’s or Ollwell or Nestle.
- High Quality Milk: Haleeb has always provided the best quality milk as it claims “SAB SE GHARA DOODH (THICKEST MILK)”. Whenever this statement is either displayed or heard somewhere, it instantly associates itself with Haleeb.
- Rigorous Quality controls: Haleeb undertakes 21 rigorous quality control tests on every portion of the milk to ensure it is the best out there.
- Efficient Research and Development department: Haleeb often conducts researches to find out the requirements of the consumers before and even after the launch of a certain product which helps them in making changes to their products according to the consumers’ preferences.
- Diversified Brand Portfolio: Haleeb, over the time period, has diversified itself into many products other than milk such as juices, ghee, butter, cheese, low fat milk, etc which gives it a competitive edge and helps it to grow even further and increases its profitability.
- Marketing (Advertisements): Haleeb seldom advertises its products which is a big weakness as its competitors spend a huge amount on TVC’s, Radio spots, etc. The only commercial Haleeb use, is for its milk which is quite old fashioned and doesn’t match up with the requirements of the consumers now days. Considering the competitors like Olper’s and Nestle Milk pack, their TVC,s are seen over and over again during prime times along with bill boards in every heavy traffic street. Awareness of these brands is much more as compared to Haleeb.
- Packaging: Haleeb, since its beginning, has been using the same packaging which has resulted as a bad sign for the company. Haleeb needs to revamp its packaging keeping consumer wants and perceptions in mind. Over the years customers are accustomed to changes as this is the era of fast transformation and anyone who does not keep up with the times will loose. Therefore Haleeb should step out of its comfort zone and come up with a new packaging for milk with sharper colors, fancier logos and convenient packs for easy accessible usage.
Haleeb is dependent upon Tetra Pak for the packaging of its entire dairy products. Tetra Pak is the only option available to Haleeb for packaging because it is having monopoly in the packaging sector in Pakistan. Due to this reason, Tetra Pak can charge them higher and it could increase the production costs. There is a bargaining power of suppliers.
Demand-Supply Imbalance: The demand for milk is not being completely fulfilled by Haleeb as it is a processor of milk rather than a producer.
- Increased funding by Government: Government has decided to increase farmers’ funding. This is an opportunity for Haleeb because previously due to weather conditions and other reasons there was lots of wastage of milk but now that can be reduced as farmers will be better able to store milk for longer time periods.
- Awareness: Growing dissatisfaction with loose milk and increasing awareness about health and hygiene issues have led to increased processed milk consumption. People are becoming more health conscious as education is increasing in villages. The population is becoming aware of the diseases associated with loose milk coming from unreliable sources. The increase in knowledge has also created awareness for nutritional value in any content of food or drink. Nestle unlike Haleeb has used this opportunity to provide consumers with an additional proved reason to buy packaged milk. Haleeb should pursue this opportunity.
- Third largest producer of milk: Pakistan is the Third largest producer of milk in the world with a total production of 32 billion liter of milk a year, whose value is more than that of the combined value of wheat and cotton, from a total herd size of 50 million milch animals (buffaloes and cows).
Livestock accounts for 46. 8 percent of agricultural value added and about 10. 8 percent of the GDP. Milk is the largest commodity from the livestock sector accounting for 51 percent of the total value of the sector. Due to the steps taken by the government and private sector, country’s annual milk production is expected to grow at an additional 3 billion liters in the next few years. This is quite an opportunity for ENGRO foods as there is lot of growth in this part of the sector.
Competition may pose a threat because the company will have to maintain its leadership in an expanding market so that it doesn’t lose its market share to its competitors. Competition seems to be getting tougher as a result of new players entering the dairy market such as Olper’s, Ollwell, Gourmet, etc. Competition is a very important threat because in order for you to excel, you have to be well aware of the next move that your opponent will take. The idea is to prevent losing your potential customers as well as those who were loyal to you. Haleeb milk cannot afford to give their loyal customers a reason to prefer another brand.