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Strategic Management Practices at Munchee

Strategic Management Practices at Munchee

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Published by thilangac
strategic management practices at munchee
strategic management practices at munchee

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Categories:Types, Business/Law
Published by: thilangac on Apr 04, 2011
Copyright:Attribution Non-commercial

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09/11/2014

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Part 1- Organizational Analysis:
Ceylon Biscuits Ltd was founded in late nineteen sixties by under taking contract fromSri Lankan government and Care International (USA) to manufacture protein enrichedbiscuits for Sri Lankan school children as a mid day meal. While dealing in this contractmanufacturing for the Care International, it was noticed by the company that excessproduction capacity was there. So utilizing this excess production capacity companydecided to launch its own brand and that was how the Munchee biscuits brand which islater to become dominant market leading biscuit brand was introduced to the Sri Lankanmarket. Till late nineteen nineties Munchee was not the dominant biscuit brand in SriLanka. Till that time from the starting of the Ceylon Biscuits, the company was engagedin contract manufacturing for Huntley and Palmer of associated biscuits UK other thanproducing biscuits for Care International.From the beginning of new millennium, Munchee brand started aggressivelyinvading the biscuits market of the Sri Lanka and now the company Ceylon Biscuits hasbecome one of the largest privately owned group of companies of the Island. With thedawn of the new millennium, Ceylon Biscuits launched its diversification drive by settingup its wholly own subsidiary CBL Foods for chocolate, cake and jelly production and atthe same time CBL took controlling share of Lanka Soy, Convenient Foods (Samaposha)and Cecil Foods so that the company has now in a position to offer diverse of products tothe food market of the Sri Lanka.Vision of the Ceylon Biscuits Ltd is to become leader in confectionary in SouthAsia with a global presence and recognition. As a privately owned group of companies,CBL group has no clearly explicit mission. Instead what the company CBL does isadapting set of marketing objectives, like increasing market share of a certain brand bysome percentage for achieving each year.Today CBL group’s core business is food manufacturing and initially it waslimited to biscuits manufacturing. Then the company moved to manufacturing of chocolates under the brand name of Ritzbury, and also manufacturing of cakes under thebrand name of Tiara and also wafer biscuits manufacturing under the same brandMunchee and recently company ventured into production of instant jelly under the brandname of Go Jelly. During the same period the company has taken controlling share of 1
 
Lanka Soy, Samaposha and Cecil so now CBL is competing in fruit drinks market, Soyproduct market and serials and snacks markets of the country.In term of market share the flagship brand Munchee is holding over 60% marketshare in the biscuit market of the country and cake brand Tiara is holding around 80%market share by almost whipping out other competitors in the market. At the same timeother dominant brand Ritzbury is having 50% market share in the chocolate slab marketand over 70% market share in chocolate coated product market. So it can be concludedthat in areas of biscuits, cake and chocolate markets, CBL has been market leader in theSri Lankan market for past few years and most likely the company would be able tomaintain its dominance in the market.Fig: 1 Munchee Biscuits market share in the market. (Source: AC Nielson retail audit)2
 
50251510RitzburyCompetitor-1Competitor-2Others
Fig: 2 Chocolate Slab market share of Ritzbury for year 2010 (Source: AC Neilson retailaudit)When it comes to explain resources availability of CBL group, over 2000 work force isemployed by the group in their, Pannipitiya, Ranala, Minuwangoda, Ratmalana andKandy factories. Land area of Pannipitiya plant was fully filled with plant buildings andno further building expansion is possible there. In Ranala plant, which is nearly a 13 acrefacility, only small land area is available for future expansion. In term of land areaavailability, situation of premises such as Kandy, Minuwangoda and Ratmalana are alsomore or less same as above. Therefore the group has invested in Seethawaka IndustrialPark and where group is going to set up their new production facility solely for exports.As company vision says, CBL is targeting vast market opportunities in the subcontinental Indian region, the group has already bought land in Bangladesh for its firstoverseas manufacturing facility.So far the group has been operating as a privet limited company which is nowalmost 12billon Rupees Company, is in the process of considering to become a publiclimited company as company has grown too big already and also huge investments are indemand in order to make sizable presence in the Indian/Bangladesh markets.3

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Gayani Hettiarachchi added this note
great job..i got a lot of information about CBL..THANKS A LOT..
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