Executive summary
The purpose of this business survey is to provide understanding on the marketplace tendencies facing the soda industry and a details strategy for the release of a fresh carbonated soft drink Ice-cola in Pakistan. The thought of releasing a carbonated soft drink in Pakistan is to improve consumer tastes, an evergrowing focus on product safety, and enhancing the market shares and profit margin.
Soft refreshments are non-alcoholic (carbonated) as well as non-carbonated beverages which is often classified in range of categories. Carbonated drinks are in popular and are preferred by nearly every category of population in the world. More specifically, the demand for the carbonated carbonated drinks in Pakistan is highly affected by certain characteristics like spiky flavor, culture and interpersonal trends in get-togethers and religious characteristics.
The strategy of new soda Ice-cola (which is likely to be launched in Pakistan) will have to face competitive market in conditions of other carbonated carbonated drinks particularly giants Pepsi and Coca -Cola because these soft drinks have previously well maintained its positions in Pakistani market for a long period. Nevertheless the strategy of new soda Glaciers- Cola in addition has competitive advantages in terms of changing consumer flavor and relaxing sparking element that will ensure profitability and quality popularity in Pakistani population.
Introduction
Soft drink industry
Soft drinks are normal tastes among all the individuals in nearly every region of the world. The name "soft drink" especially separates alcoholic beverages element out of this category and the word "drink" with a number of soft drinks like colas, sparkling water, iced tea, lemonade, squash, and fruit juices are among the most typical types of carbonated drinks. Soft drinks are slowly but surely overtaking hot drinks and other drinks as the major drink sector on the planet. However the US remains the largest market at the moment and Asia seems to be the main drivers of sales growth in the foreseeable future. Now-a-days soda is more most liked refreshment drink than tea, espresso and other hard beverages.
Murray (2006) has explained the soda industry by stating,
"For a long time the storyplot in the nonalcoholic sector devoted to the power have difficulties between Coke and Pepsi. But as the pop combat has topped out, the industry's giants have started counting on new product flavors and seeking to other carbonated beverages for development. "
Global Soft drink Market Situation
Soft drink industry has a powerful effect on the lives of its consumers from across the world. The intake of the carbonated drinks extended to increase time by calendar year because of website link between healthy diet and carbonated drinks. King (2010) claims that in 2009 2009 Eastern European countries, Africa, Midsection East and Asia are fastest growing parts as compare to developed market segments. In soft drinks category, bottled water, carbonated, non- carbonated and other fruit drinks can be purchased in the market. Bottled watered beverages have achieved acoustics sales growth scheduled to distinctive traits of the merchandise which is relaxing element in hot weather and sugar free flavored drinking water. On the other hand, a number of functional drinks had been also a part of consumer's interest. Each soda has certain traits which allures its consumers. It is actuality that some carbonated drinks remain very popular in the market for certain reasons such as brand image, quality and price. The marketplace size of the soda industry has been changing with the time being. This industry has 46. 8% market stocks within non-alcoholic industry. The global carbonated drinks market was respected at $479bn in 2009 2009 and is also projected to develop at a CAGR of 3. 1% to attain $556bn in 2014. Matching to financial forecast period to 2014, soft drinks sales are anticipated to increase 39. 8% to PKR19. 5 billion ($233 million). (Euromonitor Passport GMID)
Pakistani soft drink market situation
The soft drink market in Pakistan loves a dynamic growth in context of volume and value areas because of Pakistan Administration have reduced excise fees to encourage carbonated drinks produces and importers. THE FEDERAL GOVERNMENT of Pakistan in addition has decided to tax the soft drink industry on the production capacity rather than on actual creation. Pakistani market situation about carbonated drinks achieved a somewhat soft and positive progress during the years. CAGR 4. 2 % represent sufficient line for soft drinks stableness in Pakistan. Concurrently there were some inflationary pressures on soda industry. However still this industry remains stable successfully to keep carefully the durability of market stocks (Euro monitors Passport GMID). The reason for the positive market development for carbonated drinks and specifically in carbonated drinks is due to hot weather, people's preferences and various life developments.
Soft drink industry in Pakistan may expect increase of sale progress 30. 5%. The price and utilization of soft drinks stand almost within an equivalent rate among various parts of Pakistan. In rural areas prices of carbonated drinks are just a little reduced than posh areas
(Euro screens International's soft drinks in Pakistan).
Carbonated drinks
Within the soda market, carbonated soft drinks continue steadily to dominate the marketplace, due to traditional flavoured drinks, sugars- and caffeine-free refreshments. Mostly Carbonated drinks are dominated by unnatural flavours based on cola, sweetened with sugar or with non-caloric sweeteners. On intake level, there are some factors which impact the consumers to buy soda pops for several reasons like, status symbol, flavor, variety, brand ambassador and marketing campaign especially in Pakistan. The demand for the carbonated carbonated drinks is mainly affected by the style of the clients, age ranges and the demographic conditions. For example the demand for carbonated drinks escalates to lot in Pakistan especially during the summertime period and slightly drops in winter. The main target section for carbonated drinks is the young ones. The carbonated cola drinks are saturated in demand in Pakistan due to a number of reasons for example; all cola soda pops are offered in restaurants, hotels and celebrations within dishes and customers like a spiky and stimulating flavour of carbonated drinks which is not possible by other soft drinks (juice etc). Moreover Alcoholic beverages is not used due to religion limitations in Pakistan.
However on the whole carbonated based drinks like Coca- cola, Pepsi (low caloric cola beverages) have been remained at the top demand in Global soft drinks industry.
There could become more significant volume level opportunities in future by carbonate taking its enough shares, with carbonates more likely to pick up the majority of the volume progress as earlier % shows like 23. 8 % and 24. 0 % in 2008 and 2009 respectively. (Euro displays Passport GMID)
Soft drinks Graph by Volume Percentage
Source: Official statistics, trade associations, trade press, company research, store assessments, trade interviews, Euro keep an eye on international estimation, Euro monitor GMID passport.
From the aforementioned graph, maybe it's analysed easily from 2003 to 2009 the volume % of cola carbonates as compare to other soft drinks has achieved higher %. It clearly signifies that cola carbonates (soft drinks) are used and produced more than other beverages in the market because of the demand and higher intake level.
Competitors
In the present market of soft drinks in Pakistan there are a few giant and small competitors for Glaciers- Cola in the market. The following classification of delicate soda pops in Pakistan in terms of competition can sketch a clearer picture.
Classification in terms of competition
First Preference
Second Preference
Followers Preferences
7-up, Hill Dew, Sprite, Marinda, etc
The others
Amrat -cola etc.
Pepsi and Coca-cola
Pakistani carbonated soda market is dominated by Pepsi. Today Pepsi brand is part of global portfolio of beverages brands which includes carbonated carbonated drinks, juice drinks, caffeine etc. Pepsi is a carbonated drink that is produced and manufactured by Pepsi Co. Now there are lots of Pepsi variants available in the market such as (Diet Pepsi, crystal Pepsi, Pepsi twist, Pepsi maximum and Pepsi Gold etc) and Pepsi is regarded as No 1 Pakistan Country wide drink. Major rival of Pepsi is Coca- Cola. Pepsi is bit sweeter than Coca- cola and it is liked by all (Pepsico. co). Coca- cola is next to Pepsi's competitor and international acknowledged brand. Coca- Cola's basic strength is its brand name. With this brand the sales expansion is increasing ever before year and under this trade symbol Coca cola, - zero, Diet - Cock and Coca- cola Zero has developed its competitive market. Coca- Cola volume progress is very extreme in different market segments on earth, particularly in three marketplaces Vietnam, India and Pakistan. The quantity development is 27%, 25% and 18% respectively. While Pepsi with its diversification in drinks, packaging and broad market sector is more successful than Coca-cola to keep its successful position in the Pakistani market. Pepsi and Coca-cola brands have various % in terms of market research in different markets of the world. According to Beverage process report 2009 in the U. S market PepsiCo 30. 8 % market show while Coke have 42. 67 % market
shares. This shows coke's positive durability as compare to Pepsi in U. S market. (Coca-cola. com). (Research proposal for soft drinks)
Pepsi and Coca-Cola market scenario in Pakistan
Pakistani drink industry is dominated by Pepsi and Coca-cola brands. They are two major brands in carbonated soft drink industry in Pakistan. Pepsi-co encountered initial problems while settling in Pakistan in 1959. Nonetheless it came up again in 1963 with dominating strategies. It used franchised access mode to develop its market in Pakistan. Among the major reason of its success as compare to Coca-cola in Pakistan is this, it serve a huge segment and because of the diversification of their product line and particularly franchising entry for them to take quick decisions. The fees that Pepsi will save because of using franchising access mode allows it to target more on advertisements and promotions of the products increase sales earnings. Availability and getting together with the consumer demand is one key factor that plays a part in Pepsi success in Pakistan.
At first, Coca-cola managed its business in Pakistan in 1950 as a franchise and became the first choice of the soft drink industry because there was no competition in those days however in 1960 it must face competition in the condition of Pepsi. In 1966 coca-cola controlled its business in Pakistan as a multinational company and had taken total the franchises business at that time. Since that time it became very difficult for Coca-cola to keep its markets shares as previously. Being truly a multination company it has to pay large amount (3 times greater than Pepsi) of taxes to Government. (PepsiCo, Inc. )
SWOT Analysis of Pepsi and Coca-cola
Strengths
Pepsi
Coco-cola
Establish name and sound reputation of company
International brand image
The demand of Pepsi is more high than its competitors
Coca-cola bottle image and use from it brand image on various objects
International competitive position and much more market stocks than competitors
Broad advertising and advertising opportunities running a business world
Weakness
Pepsi
Coca-Cola
Pepsi does not offer any discount to its retailers
High prices
Target consumers are only young people
Rare availability in remote areas of Coca -cola in Pakistan
Pepsi tins are not available in much remote areas of Pakistan
Taste differentiation is not successful and great, almost just like Pepsi
Opportunities
Pepsi
Coca-Cola
Company is considering to enter into rural areas
Successful brand image may improve the opportunity to advertise less popular products
Sponsoring many social shows and activities give an possibility to enhance sales progress of Pepsi
Increasing opportunities of internet offers
Training and service opportunities
Company is trying to. . . . . . . . .
Threats
Pepsi
Coca-cola
Major competition is coca-cola, at international level cock brand is more firmly advertised rather than Pepsi
Dominant threat to this industry is changing consumer's taking in habits in terms of health
Imitators of Pepsi brand in Pakistan and customers problem about the non-availability of original drink
Major rival (Pepsi) has a strong position in the market.
Non - carbonated drinks such as juices and tea have retained good position in the market
External hazards of labor strikes in Pakistan
(Pepsi. Com, Coca-cola. com)
Performance research of Pepsi and coca-cola
Make a graph or pie graph here to show Pepsi and Coca-cola Circumstance, collect data because of your self
Sales analysis
Market talk about analysis
Expense analysis
Financial analysis
Analysis in own words
Reasons of starting Ice-Cola in Pakistan
To increase sales development, earnings and market shares
To maintain good reputation on the market among competitors
To introduce a fresh brand directly into soft drink industry
Brand Idea of Ice-cola
Ice- cola would be a new soft drink for the people of Pakistan and for all your other folks of the world. Carbonated cola refreshments are usually for eradicating thirst as well as for have a feeling of refreshment. Same is the creation philosophy with Ice-cola. It will introduce an innovative and refreshing taste in the soda market and enhance the number of carbonated drinks on the market.
Mission Statement
Ice-Cola mission is to be the first main concern of consumers in soft drinks market and it will provide best and different taste to consumers. Therefore, they can enjoy a fun and refresh sense after having it. This brand thinks in strives for honesty, fairness and integrity in the complete process of introducing.
Industry evaluation of Glaciers Cola
According to Aaker (2009) Market research builds on customer and competitor analyses to make some strategic judgments in regards to a market (and sub market) and its own dynamics. Ice cola is clean Pakistani product because it will produce domestically and Ice cola will have competitive gain up against the other imported soft drinks like low cost etc. As previously mentioned it is 100 % pure Pakistani drink so the company can take the good thing about "be Pakistani and purchase Pakistani" also. Glaciers cola can be personalized based on the various needs and demand of the Pakistani culture, which may take place from time to time.
During the development of the idea of the product the technical changes are considered. Initially through the production of ice cola existing technology will be used. Later on with the passing of the time when there is change in technology then new technology will be presented for long run after appropriate pre- evaluation. Presently there are no as a result legal concerns about this business. Being a food item there is absolutely no as such restriction imposed by the federal government because as this product is domestically produced and all the materials used is HALAL.
As there are many soft drinks can be purchased in the neighborhood market but Ice-cola focus will concentrate on the fitness of the consumer. This product is healthy and it will produce locally so more consumer will replace there other soda pops and energy beverages by some locally produced much healthier carbonated drink. Company is creating its own market with the initial style with cola flavour and original flavour without the result of any harmful chemical compounds. Over the year or two the sales of carbonated drinks in the Pakistan has doubled and the demand of the carbonated drinks especially locally produced increased within the last three years so the progress rate of the industry would be acoustics. During the last three years no new organization has got into in the Pakistani soda business and no new product has been launched by the competition so since previous three years. Circulation channels of glaciers cola. . . . . . . . . . . . . . . . . . .
Theory
Existing distribution programs can be explained by how direct they are really to the client.
Trends and emerging channels, new programs can offer the possibility to develop a competitive advantage
Channel power composition for example in case there is a product having little brand equity, merchants has negotiating vitality over manufacturers and can record more margins.
Market segmentation of Ice-Cola
According to Ferrell and Hartline (2008) to enter into a new market, any product strategy would follow the standards of segmentation in line with the chosen market situation. They demonstrate that there could be different approaches to segment the market. Various methods do work in various circumstances. Most of the time this will depend that where (chosen market) the merchandise is likely to be launched. Nonetheless it should follow certain characteristics like significant, accessible and measureable. So that it can generate profit. Snow cola will be use different ways of segmentation of product in Pakistan on the foundation of
Geographic Segmentation
a) Geographic Region
Ice cola to begin with will aim for it product in major places of Pakistan like Rawalpindi, Lahore, Faisalabad, Karachi and then it started concentrating on its products into different other places. Then it'll target complete country and later will operate in other countries of European countries and East globally. So its geographic segmentation will be large.
b) Density
Ice cola first controlled in Rawalpindi, Lahore, Faisalabad and Karachi. Then it will start targeting urban, rural and sub-urban regions of Pakistan.
c) Climate
This is also reality climate has great result in concentrating on different market sections. Glaciers cola will mainly concentrate on in the warm weather countries like Dubai, Pakistan, Saudi Arabia.
Demographic Segmentation
Target Market of Glaciers cola
Teenagers
Adults
Sport persons
And also late 50's
Total people of Pakistan is 165 million (GDP 2008). Ice cola targeted all genders including males, females especially children. The focus aim for of Glaciers cola would be age group between 15-32.
Age
The focus aim for era would be 15-32 because it represents the larger portion of the Pakistani population.
As it's been approximated from the above numbers that target consumers are between 15-32. Therefore highest 39. 20 % of total population will consume Ice-cola at the most. The higher the utilization level, the higher the revenue would be in the long run.
Religion
As Ice cola is operating in Islamic country. Therefore it can make its products with "HALAL MATERIAL". Since it targets Islamic countries like Pakistan, Saudi Arabia. As, alcohol and various other materials that are prohibited in Islam, so
Ice cola won't use almost any materials in its product. Therefore internationally it'll focus on Muslim Countries first and later it'll operate at global level.
Psychographic Segmentation
This will be the main segment which Ice cola will use in its product. It will reveal what customer considers our product. It explains point of view of customer about the merchandise. It's the science of using psychology and demographics to better understand customers. So when Snow cola will realize the needs of customers. Then it will begin working on different products matching to customer's need and demand.
Pakistan's environment is usually warm and humid which in turn causes dehydration and increase in thirst. In Pakistan carbonated drinks aren't only considered a liquid consumption but considered as a status icon among friends, colleagues and family affairs. Getaways and particular spiritual occurrences for example; Eid and fasting month (Ramadan) the sale of carbonated drinks increase. Moreover in the other periods (winter) carbonated drinks sales do not have an impact on highly but continues a steady progress. For the next returning years (2010-2014) it can be estimated a reliable growth overall. Increase in sales growth is expected because of the young Generation beneficial procedure and sparking fun towards carbonated cola refreshments in Pakistan.
Market accessibility strategy and market development
Operation plan
Operation plan of the merchandise includes inventory, transport, storage, and inventory control technique and customer support. Kent (2003) declares that inventory are a significant aspect of any business's procedure plan which gives keep to the structure of business. Inventory is the uncooked material or stock goods organised by any business. Effective inventory management (control) in operation plan can lead the business to create huge profit and poor monitoring might be in result of catastrophe of the business. In case of Snow cola just with time inventory will be used in case of product. It will reduce the storing cost that will give us competitive advantage against aim for customers. All manufacturing operations will need place in Snow cola stock.
Aaker (2009) illustrates that distribution system include three type of sections. For example; Alternative distribution channels, new emerging programs and powerful channels. He focus on this issue that not consider only existing stations but also think for new potential ones by which product could be more easily available for its consumers and business users. For Ice-cola creation outward suppliers will pay the shipping charges for the done goods. In case of bulk purchase of the products company will pay only 30% charges, purchase of 50, 000 models in a month is the limit for the propose. Trained employees and machine operators will be chosen from the other factories as a component time staff at 900Rs. per day and they will train our long term workers. Completed product of the Glaciers cola drink will be stored in company retained building which has capacity to store 150, 000 units in it. Lease of the building is Rs. 35, 000 per month. Ice-cola will maintain the completed goods inventory of 60, 000 items anytime including the stock.
Kent and Omar (2003) specify the value of maintenance and customer support especially in term of new product launching. A fresh business can take two way benefits. At first, it can make devoted relationship using its consumers by providing advice and support after a sale. Secondly, it could demonstrate additional positive way to obtain revenue by means of life time customers. By keeping in touch with customers and providing quality confidence after deal is an important factor to generate income through product. A information survey could be conducted after six month period of launching the merchandise to find out the market trends, response and consumer demand. Later on product can be improved regarding to needs. Marsen (2007) narrates certain tips in term of facilities in operational strategy to run the business successfully. It is very important to notice that how goal customers will get the product. Key suppliers and transportation facilities might be near the operation centres according to the nature of the business enterprise. These facilities should be situated adequately to help make the profitable way of business.
Marketing Plan
Product
Wilson (2006) illustrates about product and product sizes that for a number of customers product is merely a tangible and physical entity which is placed in the market for buying and selling. However product is main goal of any business organization because through this firm plans to achieve its objectives. In addition, Wilson (2006) narrates the partnership between customer and product. Product should be designed based on the core market need.
Price
Ferrell and Hartline (2008) strongly advocate the significant value of costing strategy because this is actually the only element of marketing mix that causes revenue or return and price has a direct connection with customer demand. Therefore, price of something could be recharged in several ways such as value, optional, mental health, geographical etc.
In circumstance of Ice-cola, the organization will fallow its motto "BE PAKISTANI BUY PAKISTANI" consequently company will give a high quality product at a low price. It will allow firm to position as a among the finest quality and price sensible best brand.
This provides company's associates an chance to sell a high quality product, while increasing their margins and retailing a superior quality product to the resellers.
Purchase price of retailer of 1 can would be Rs 25.
Discount Offers
In your competition with the other soft drinks available for sale Snow- cola will offer you at special reduce prices to get the market shares in special happenings like Ramadan, Eid, Basant and other incidents.
Price setting up statistical data
Promotion
Aaker (2009) claims that modern marketing has changed ancient meaning of campaign with the concept of MC (marketing communication) or the coordination of all promotional activities such as ( marketing advertising, direct mail, personal offering, sales promotion, pr, packaging, store screen, website design, workers) to produce a unified, customer-focused meaning. In any manner of promotional medium could be adapted in line with the product development.
Ice -cola will be advertised by different communication stations in the Pakistani market.
Communication channels
TV campaigns (Through cable television)
Bill board
Local news paper
Advertising campaign
Placement
Place handles the distribution channels and various options for the consumers to gain access to the product. Baines (2008) describes that according to the type of the product placement or syndication channels sit. Sometimes "middleman" may involve in the circulation and placement of the product. That is all about mainly gratifying the consumers and makes convenient strategy for consumers to access the product in time.
Ice-cola would concentrate on the big and high development market cities of Pakistan like Lahore Islamabad, Karachi, Faisalabad and Multan and then Ice cola will also focus on the small cities and rural areas of Pakistan. Therefore Ice cola will available each and every supermarket in Pakistan. In future Ice -cola could be launched internationally in Midsection Eastern and European countries.
People
Write it for ice-cola
According to Baines and Fill up (2008) (people) customer support staff of any organization play significant part in term of product demonstration, convince their consumers for taking competive features of it. They build a corporate image and maintain that image in the heads of consumers which could be the very best marketing tool to possess potentail customers over time for market decelopment.
Five ps image should be here like this
Positioning
Porter's value chain model
It decides where value is added and for isolating the expenses. The cost framework is also ideal for formulating ways of create a competitive advantage
Use this model corresponding to ice-cola
Organisational Plan
Ice cola will be partner firm. The relationship will be lie between your founders of the business. Partnership will be relating to their show of capital invested in the organization.
Profit will be distributed between them according to their percentage talk about in the organization. The every decision will be taken with the consensus and majority of votes will be asked to take the decision. On every important document the personal of at least three people should be there. This will also be implying on the financial concerns of the firm. Lovers and their contribution to capital are the following.
Name of the associates Contribution
Saba Imtaiz 19 %
Suhail Ahmed 15 %
Asma Zubair 16 %
Yasir Ali 19 %
Isha Saghir 18 %
Wahab Munir 13 %
Hierarchal Structure
The hierarchal framework of the Snow cola company would be as follows:
Board of directors -------------------------------- Associates of firms
Chief executive officer--------------------------- Asma Zubair
Chief financial public --------------------------- Talha Shahid
Marketing manager ------------------------------- Nimrha Basheer
HR Supervisor --------------------------------------- Abdul Hanan
Production manager ------------------------------ Sidra Zaheer
Operational director ----------------------------- Nadia Afzal
Organisational Chart
Board of Directors
CEO
Finance Marketing People Resource
Manager Supervisor Manager
Finance Funding Marketing Marketing HR HR
Officer Officer Officer Officer Officer Officer
Forecast Financial Plan
Project financial statement of company (Ice-cola) is given below
Performa Income Affirmation (PKR 000s)
Pest analysis
Profitable strategy
Key success factors
These factors help achieve marketing objectives
Access to essential unique resources
Ability to accomplish economies of scale
Access to distribution channels
Technological progress
These factors could change as time passes as the product progresses through its life routine.
