The dairy industry has great prospective to contribute significantly to the development of Sri Lankan market. Dairy industry is a normal industry which has a history of thousand years. In Sri Lanka, lots of the entrepreneurs tend to invest on dairy industry as milk creation becoming an growing industry.
This analysis is on Lucky Lanka Milk Processing Company Small which is well-known as "Lucky". That is an organization which has many opportunities to disperse their products over Sri Lanka. Lucky has experienced staff, fresh dairy, and use great technology in their development. With all these Lucky has had the opportunity to fully capture 18% of the dairy market which is relatively low when we compared with the competitors. In this particular paper the writer will seek the possible opportunities to allow them to capture the market share and submit recommendations for enhancement to promote the business on the list of Sri Lankan consumers. (Source: http://www. luckylanka. com/about_us. html)
This paper will verify and evaluate talents, opportunities, weakness and hazards and will forward recommendations to capture the market show and to develop their product range one of the Sri Lankan consumers. These will be assessed by SWOT evaluation, PESTLE, product blend and Porter's Five Causes.
INTRODUCTION
In 1991, Lucky Lanka Milk Processing Company Limited was started out as a small size business under the brand name "Blessed". That is a well-known company in the dairy products industry, in Sri Lanka presently developing yoghurts and pasteurized milk. Lucky is leading in producing progressive products with different tastes and flavours. Their product range comprises vanilla yoghurt, chocolate yoghurt, strawberry yoghurt, treacle yoghurt, zero fat yoghurt, fresh fruit yoghurt, fruit jelly yoghurt and pasteurized dairy bottles and dairy packets. Using a eye-sight of "Creating of healthy technology towards prosperous future in Sri Lanka", objective of "To be the leading dairy suppliers for Sri Lankan consumer by yr 2015" and their main purpose is to provide best value, natural products with their consumers.
In order to be the market head, Lucky should plainly identify its competitors; develop new products and timely advantages of new products to the marketplace to take benefit of opportunities. (Source: Blessed Lanka Milk Handling Company Small, http://www. gannaapede. com/lucky-sri-lanka. html)
SITUATIONAL ANALYSIS
Dairy industry is one of the key industries in virtually any country as it reduces the ratio of malnutrition. That is a traditional industry which runs to more than hundreds years of the history. There's a huge contribution towards development of the Sri Lankan overall economy by this industry. In 1970s Sri Lanka decided to open economic regulations so there was a remarkable upsurge in the utilization of dairy items. Sri Lankan government encourages and informed Sri Lankans to employ fresh milk and milk products in your day to day life.
As there's a high demand for milk products many folks have a preference to purchase the industry. Because of this, it opens the doors for most employments.
ANALYSIS AND Analysis OF EXTERNAL ENVIRONMENT
Environmental research will facilitate to recognize the hazards and opportunities in the exterior environment in the business organisation. Lucky Lanka Milk Processing Company will be utilized frameworks such as SWOT, PESTLE evaluation, and Market Segmentation to analysis the exterior environment.
3. 1 SWOT Examination FOR LUCKY
According to Hall, R. E. (2003, p. 92), "SWOT can be an analytical tool that commonly found in the business community to assessing a business with regards to other competitive business". In order to identify the inner and the external environment of Lucky, SWOT evaluation will be utilized in this newspaper.
Weaknesses
Lack of supply of raw materials
Low quality of incoming raw materials (Dairy)
Affordability and safe-keeping limitations
Economical problems for farmers
Strengths
Awarders for farmers who supply best quality milk
Insurance schemes for farmers
High licensed staff
Upgraded technological staff
Continuous inspection, monitoring and laboratory testing
Upgraded Technical staff
Continuous in-house research & development
SWOT for Lucky
Opportunities
High demand for healthy food
Government encourage the visitors to have two cups of milk daily
Increasing extensive knowledge of folks about getting healthy foods
Threats
Strong Competitors in the market such as Newdale, Highland and Kothmale
Potential health issues
Major prolonged financial depression
3. 2 PESTLE ANALYSIS
PESTLE research is a good tool to examine the general environment of a business. The exterior factors that impact an organization can be recognizes utilizing a PESTLE examination. This refers to Political, Economical, Sociable, Technological, Legal and Environment factors that effect the organisation. William and Green (1997) emphasized that the "PESTLE elements will lead to better understanding of how the six elements might affect to an organization and exactly how strategies could be formulated".
POLITICAL - Because of the political balance in Sri Lanka for the past few years; there's a positive situation in the country for local manufactures. Federal of Sri Lanka encourages the farmers by giving financial support to develop their milk development. That is a supportive factor for Blessed as they can get the best quality raw material for their production. And in addition there is no risk for the investment in the dairy industry.
ECONOMICAL - There are various economical problems as the cost of living is saturated in Sri Lanka. The expenses of the quality product's raw materials are high. Therefore, Lucky struggles to achieve high gains in the long run. Because of the high cost of living, consumers in rural areas have a tendency to by even products for good deal.
SOCIAL - Consumer's knowledge about using nourishing food has increased by the awareness programs. Therefore, they trend to utilize fresh and quality products. And also there's a popular for no sweets yoghurts as the number of diabetes patients in the country increasing.
TECHNOLOGICAL - There is a rapid growth in the technology nowadays. Today, Lucky uses advance technology to produce yoghurt that was done by hand in the past. It has helped to improve the capacity of the merchandise. As result of this Lucky products can be advertising for a low price.
LEGAL - Lucky products are sticking with the Sri Lankan legal legislation. They have developed the ISO documentation.
ENVIRONMENTAL - Environment impact the sales of milk production intensely. The demand for yoghurt rises during dried season and the sales are comparatively low through the rainy seasons. Due to the understanding programs conducted by various people, there is a high demand for yoghurt in Colombo and suburb areas.
INDUSTRY Research - PORTER'S 5 FORCES
Porter's five Forces can be an important tool in marketing as it can help to recognize and measure the organisation's advantages and position in this business environment. This construction will provide a much better understanding of the organisation to its management. This framewrok is dependant on five important the different parts of an organisation and apply to identify both inside and external capabilities and threats faced by way of a business company. These five elements are shown in the diagram below.
http://i. investopedia. com/inv/articles/site/IndustryHandbook1x. gif
Competitive rivalry within an industry - High
Lucky has three direct competitors. These are Newdale, Highland and Kothmale. As these three are leading, have the best market share and provide well-known products in the market the majority of the consumers tend to buy them. Therefore, Lucky has a higher competition within the industry.
Bargaining power of suppliers - High
The main fresh material utilization in Lucky is milk. So it is important to make use of high quality dairy in their products and it should be adhered to the government regulations. Lucky has particular suppliers to get quality milk in order to get the very best quality products. Therefore, bargaining power of the suppliers is high.
Bargaining power of customers - High
Newdale, Highland and Kothmale are famous quality dairy products on the market which are available freely in the local market. And also, the consumers of the rural areas go for the reduced cost products because of the high cost of living. Appropriately the bargaining electric power of the customers is high.
Threats of new entrance - High
The federal of Sri Lanka encourage visitors to drink two goblet of milk and add dairy products into their foods. And also federal government has wide open economies to get on dairy products industry as this is now an growing industry in the united states. Therefore, Lucky has a higher threat of new entrance.
Threats of substitutes- Low
As there are no substitutes for milk products, therefore, the threat of substitutes lays at low level.
PRODUCT LIFE Circuit FOR LUCKY
Product life pattern consists of four periods. They are advantages, development, maturity and decrease. This curve shows the stages at the production. As Blessed products are becoming popular amonst the consumers and there's a sales expansion, so Lucky is in the early development stage of the merchandise life pattern as shown in the diagram. At exactly the same time they attended up with new enhancements.
Growthhttp://www. modernbuilderssupply. com/articles/productlifecycle. gif
(Source: http://www. modernbuilderssupply. com/articles/productlifecycle. htm)
MARKETING OBJECTIVES
The marketing goal of Lucky is to protect the complete Sri Lankan provinces by year 2015. The main objective is to fully capture the markets in North, East, and coconut triangle metropolitan areas like Gampaha, Kurunagala and Putthlam. Therefore, they are planning to build another manufacturing plant in North Central (Anuradhapura). The main reason behind this would be that the climate and other environment proof which really suites for dairy products market.
Lucky aim to start up circulation centers in every districts and indirectly this will support the Sri Lankan. And in addition, Lucky desire to be market focused considering product, price, place and promotion. To be able to achieve 30% of market show they will keep the unit sale volume of LKR 25. Lucky aim to organize recognition programs for farmers to boost the effective cattle bottom.
Time
Achievable
Measureable
Specific
Relevant
Specific: The specific marketing objectives are to reach to possible marketplaces as accurately as is feasible and use least time.
Measurable: They plan to reach the measurable goals in terms of the sales income earned soon after the start.
Achievable: The fixed cost must be included in effective use of marketing skills to maximize sales and profits.
Relevant: Ties in properly with the marketing aims of Lucky.
Time: Objectives need to be achieved within 3 years after the release of new factory.
MARKETING ORIENTATION
The concept of the creation is to increase the creation of the dairy products and reduce cost. The merchandise concept focuses on producing nutritious products and boosts more quality and progressive features. Generally offering concept provides high focus on the marketplace place and marketing concept taking a look at the marketing process in a alternative manner. The ultimate outcome is always to achieve gains through customer satisfaction.
7. 1 LUCKY ORIENTATION
Lucky is actually a sale focused organisation. They mainly consider about high quality and high price in their products. In order to capture the marketplace, Lucky must put into practice effective promotions such as buy one and get one free, special offers and perform an efficient sales in order to maximize income. With the aim of achieving high earnings the marketing team of Lucky should sell more items. They are able to sell 200, 000 yoghurt per day and their daily income comes around LKR 5, 000, 000.
Figure - Market Talk about of Dairy products Industry
MARKETING STRATEGIES
Current marketing strategies of Lucky is to encourage both sales representatives and consumers, therefore, Blessed uses drive and draw strategy. Blessed uses push approaches for sales representatives by providing them with commissions, foreign tours and reselling targets. They use take technique for consumers by providing acceptable price, high quality and different flavors.
TARGET MARKET
Sri Lankan target market for dairy industry contains lower income, middle class, upper middle and upper course consumers. Lucky market their products especially for the center Income level and lower middle income. Their segmentation methodology will be standard strategy, although mass marketing creates low costs, high volumes and margins. Segment Marketing will create a finer tuned product offering and price for the prospective segment.
Target Market can be further independent out on basis of Demographist, Geographic, Psychographic, and Behavioral Characteristics.
MARKET SEGMENTATION
According to McDonald, M. & Dunbar, I. (2004), market segmentation is the process of splitting customers, or potential clients in market into different categories or sections. Lucky has a number of product range as shown in the diagram. In this particular paper will focus on the chocolate and no sugars yogurt.
Chocolate Yoghurt
No Sugars Chocolate
Geographic
Urban, sub urban and rural
Region: Full country
Urban, sub urban and rural
Region: Entire country
Demographist
Age:5+
Gender: Man/Female
Income: Over LKR 10000
Occupation: Employees and non employees
Social Course: Low income, Middle income, Top middle and Top class
Age:35+
Gender: Male/Female
Income: Over LKR 10000
Occupation: Employees and non employees
Social Class: Low income, Middle income, Top middle and Top class
Psychographic
Life Style: Outdoor
Personality: Ambitions/ comparative
Life Style: Health conscious
Personality: Ambitions/ comparative
Behavioral
Emotional / functional
Emotional / functional
As shown in the above table, Lucky delicious chocolate and no glucose yoghurt segmented to the entire country for both male and feminine. They are for the low income, middle income, and upper middle and top class social classes with an income of over LKR 10, 000.
POSITIONING
The process of reaching market sections can be called as positioning. It can focus on new brands but could also involve repositioning existing brands. Blessed position their products as impressive, environmentally friendly and quality products with brand offering. Blessed main competition are Newdale which includes the best market share in the industry, Highland and Kothmale. In the next graph, the writer evaluates the quality going along with the price in the dairy industry. It could be seen that, Lucky has position themselves as top in quality and low with price the opponents Newdale, Highland and Kothmale.
Quality
High
Newdale
Kothmale
Lucky Highland
Low High
Price
Low
PRODUCT MIX FOR LUCKY
Product
Lucky uses high quality milk in their products which match the government rules and regulations. Therefore, Lucky products are made with pasteurized, organic skimmed milk, live active Bulgaricus, and Thermophilus cultures like yoghurt cultures.
Price
The price of something will rely upon many factors. A few of these factors are price of natural materials, cost of labour, building rent, and technical costs in production. Therefore, Lucky will price their products accordingly.
Promotion
Promotions play an important role to be able to tap the consumers. To be able to create understanding among consumers Lucky uses media advertising, display planks and participate at gross annual food exhibitions.
Place
Their products are available in their own outlet stores, super markets and other food shops.
(Please send appendix II)
RECOMMENDATION AND CONCLUSION
Lucky's total mission and aims are clearly explained by the management. Marketing is the main role to be able to attain the overall objectives. Blessed main goal is to create a strong romance with the consumers and gain more gains. Lucky, first identify the market to their products, divide this directly into minor segments, choose the most important segments and focus on supply and satisfy the consumers in this segments. The very best management of the Lucky should carry out a marketing analysis, marketing plan, implement and control with an aim to find the best marketing combine which is often put into action easily. Through this Lucky will be able to identify the marketing environment and the opportunities to broaden the business enterprise.
In order to recognize the opportunities and stay away from threats Blessed must analysis its market. It must analysis talents and weaknesses in addition potential marketing activities to choose which opportunities that Lucky can be follow. Delicious chocolate and vanilla yogurts are in good demand while others are less preferred. Can we popularize new brands, like "Kithul"? (Please send Appendix III, IV). The trend in the current market is for medical conscious products. To become progressive, Lucky can present new products thinking about the health problems. This may have high demand as there are prevailing health issues in the country. The management of Lucky must regularly plan their analysis, execution and control activities. (Please refer Appendix V)
Marketing implementation can be done with the effective marketing activities such as day to day and mouth area to oral cavity activities. That is essential to achieve the proper marketing objectives such as achieving the target sales of each kind of yogurts in several districts.
In the turbulent business environment, it is essential to be impressive and competitive. Producing new products that have not unveiled by the opponents will able Lucky to disperse their business.
The merchants play a main role in reaching the profits. Therefore, it could be suggested that Lucky should provide more intensives to the vendors, in order that they will promote Lucky products among the list of consumers.
To capture a larger market share, employees of Lucky should work hard. Successful marketing implementation will depend on how well Lucky blends its people, organizational framework, decisions and rewards systems and culture into a prepared success programs that facilitates its strategies. Therefore, Blessed employees must needed skills, inventions, drive and personal characteristics.
Finally, this is applied effectively, if the marketing strategies of Lucky fit with principles and beliefs of employees of the business and culture of Lucky.
