STRATIGIC MANAGEMNT

Business Strategies of

BANANA
CRAZEE
By

[Type the document title]

BUSINESS STRATIGES

Subject:
Course Instructor:

Sir Amad

Subject Credit Hours:

3 Hours

Following Students are the participants to prepare &

finalize this Feasibility Analysis!
Student

Muhammad
Adil

Roll No:

Student ID

45 REG

S4
F13Mcom0045

M.Com
4th Semester

Confidential

BANANA CRAZEE= A Product by I

[Type the document title]

BEST REGARDS
TO

OUR PARENTS
WHO LOVE, AFFECTION & PRAYERS HAVE BEEN
A SOURCE OF INSPIRATION AND
ENCOURAGEMENT FOR US!

Confidential

BANANA CRAZEE= A Product by II

[Type the document title]

Table of Contents
Sectio
n No:
01
02
03
04
05
06
07
08
09
10
11

Section
Executive Summary
The Business
Management Team
Legal Company Structure
Ownership & Intellectual Property
Industry Analysis
Business Strategies
Operational Strategies
Porters Five Forces & BCG Growt Matrix
Critical Risks Factors
Appendix

Confidential

BANANA CRAZEE= A Product by III

Page
No:
01
04
08
24
26
29
33
41
46
54
56

[Type the document title]

Acknowledgment
With the name of ALLAH who is the most beneficial & merciful
and He enable us to complete this business proposal to overcome
our semester requirement.
Then we thanks to our Entrepreneur Mr. Amad who guide us in
very beautiful & nice way. The supervision of Sir Faisal has provided
us a lot of experience to get the view of actual market.
We are very thankful to Sir AltafAlam Sir Irfan, Sir Naeem & all
other honorable teachers who share their experience & knowledge
with us to complete this project in very efficient manner.
In last, we are much respected for those students who provide us
encouragement to complete this business feasibility report.

Muhammad Adil

JUNE 9th / 2014

Confidential

BANANA CRAZEE= A Product by IV

Section 01:

Executive Summary

Section 01:

Executive Summary
Our company Frito Enterprises will produce a unique and different product for the
market to change the trend of the people from vegetable snakes to fruit snakes. We will provide
specific unique products to our targeted customers for their maximum level of satisfaction. There is
no any firm who produce Fruit Snacks till now in our national market. We will offer these new
trended products at moderate prices for the customer benefit.

The Opportunity
Pakistani Market exports & demands fruits in huge quantity, but there is no any firm is
present at here for the manufacturing of Fruit Snacks. We will provide to him fruits in various
tastes, like apple, banana, orange, etc in roasted, snakes & chips form.
If we will proper launch this business, then we may be in condition to change the market
trends within the 10 years. If we will change the trend of the market then we will consider as Trend
Maker for the Snacks Industry.

Competitive Advantage
There is huge gap is present in the market for the fruit snacks. We have no any direct
competitor at local & national competition till now. Our product will be unique in the market; we
will easily achieve economies of scale with the next 12 years who provide us least cost with
maximum profit. Following are our major indirect competitors in the snacks industry but all of them
producing vegetable snakes as:

Lays
Golden Chips
Smiths
Kolson
Super Crisps
Krincles
Pringles

BANANA CRAZEE= A Product by Frito Enterprisez~ 1 ~

Section 01:

Executive Summary

All of these firms are the heavy weights of the market and have the great influence on the
behavior of the market. All of these are our indirect or may be future competitor for us. Most of
these firms have a great market share, but not like Lays who is the leader in the Snacks Industry.

Target Market
If we offer this product in the market then our basic target market will be youngsters of
colleges & universities who enjoy these kinds of product. When we will get a successful response
then we launch this product of specific city where college or university exists. In our first attempt,
we will target three cities within the 7 months to the first launching.
In general sense, we have comprehensive market because every aged person has a
reasonable demand of the chips. If we will target maximum colleges & universities of the Punjab
within our first three years of launching then we will achieve a reasonable & stable place in the
Snacks Market.

Management Team
For the managerial affairs of Frito Enterprisez, we have to choose best one management
personalities from the market who will supervise us. For the effective management, we have
following managerial posts as:

CEO/Chairman
Board of Directors
Finance Manager
Accountant
Marketing Manager
Production Manager
Quality Inspector
Coordinator
HR Manager
Asst. Cost Manager
Other Staff Members

This will be our best try to choose well experienced & well qualified management team
in the larger interest of the business success. But our major focus is finance & marketing heads that
provide value & brand equity in the market. We will provide sufficient benefits to our employees
because we believe that firms employees are our assets.

BANANA CRAZEE= A Product by Frito Enterprisez~ 2 ~

Section 01:

Executive Summary

Financial Projections
According to the Snacks Industry, we are unable to demand a huge capital from the market.
But for the proper launching of business, the total required capital of business is Rs. 100 Millions.
According to our analysis we have to require 7 investors which will act as the owner of the Frito
Enterprisez. For the operations of firm, we will demand Rs. 50 Million as initial investment to
startup the business and Rs. 25 Million in IInd year & also Rs. 25 Million in IIIrd year.
For the return on investment, we plan a strategy as ROI Policy; we will provide maximum
return to our investor. We will distribute 3% to 14% return on the net profit to our 7 investors who
will act as the owner of our business. We will distribute return on investment in 2 nd year to the
establishment of business. According to the ROI Policy, we will divide Net Profit of the firm after
taxation & other expenses among the whole investors.
After the achievement of the breakeven within 2.64 years (32 months), we will make huge
profit for our investors. The profit generation in this business is not difficult due to less cost on all
inputs of the production, especially raw material. We have 45% ratio of Gross Profit on the sale of
each unit with respect to their Sales Price.

Exit Strategy
Success is not always the fate of any business. For the exit strategy to our stakeholders, we
will apply following strategies as:
Sale of Business to any Heavy Weight of Snacks Industry with Product Formula
To merge Frito Enterprisez with any other Industry related Firm
Bank Raptly Slip to our all stakeholders

BANANA CRAZEE= A Product by Frito Enterprisez~ 3 ~

Section 02:

The Business (Description)

Section 02:

The Business - Description

Our Opportunity
Business is the name of profit earning through legal activities. The most important
parameter towards profit making is the presence of an opportunity gap in the market because
homogenous products have a great sense of competition as compared to heterogeneous.
For the Fruit Snakes, we have a great opportunity in the national market because there is no
any producer is present here who provide this trend to the people & earn sufficient revenue. The
international brand Pringles is present who provide caned banana chips at the limited level with
very high price.

Description of Business
We Frito Enterprisez will facilitate to people by fruit
snakes in packets at the reasonable prices and obtain sufficient
value from them. Now, people enjoy their life with potato chips,
snakes, popcorns, chocolates, etc. but we will provide them a
concept of Fruit Chips or Fruit Snakes which will be better for their health.
Our initial product will be Banana Crazee A Taste of Nature (banana chips) in the
market to get an overall response of people towards Fruit Snakes. There is no any direct competitor
is present in the market but a lot of indirect competitors are also present who are the price makers &
trend changers.
The first mover advantage in the Snakes Industry goes to Super Crisp who was the king of
this industry for 25 30 years. Then 10 years ago, Lays A Product of Pepsi Co. entered into the
market and replaced the Super Crisp into Lays French Cheese. Due to huge network,
extensive promotional activities & international brand equity Super Crisp lost their market share to
Lays.

BANANA CRAZEE= A Product by Frito Enterprisez~ 4 ~

Section 02:

The Business (Description)

We have a great threat of take over & market crash from Lays as multinational brand. If the
Lays want to tackle our product then 2 years time period minimum will be required due to their
policy matters. For any multinational brand, it is not easy to launch a new product in the specific
market within the few days or months because their strategies & policies recommended by their
higher authorities which is time consuming task.
Pakistan is a consumer market and our consumer is price conscious not quality or product
conscious. Frito Enterprisez will provide our products at reasonable prices to capture the sufficient
value from our customers. We will consider as First Mover Advantage in the snakes industry
relevant to fruit snakes. There are so many broad chances towards the success of this product.

Vision Statement
We want to satisfy our customers by the taste of nature

Mission Statement
We want to offer our dedicated and innovated products to customers for their
maximum satisfaction as our ultimate goal. We want the growth along with our customers,
staff, employees, suppliers and all other business associates by greater value

Major Objectives
For the 15 20 years in the future, our firm Frito Enterprisez will achieve following
major objectives from the target market as:

To known their brand as Frito Enterprisez within the next 6 years at national level
To provide a quality product to consumer at reasonable price
To loyal the customers towards brand & capture brand equity from them
To consider that employees are our assets who provide us their services in honest way
To change the mind of people from vegetable snakes towards fruity snakes in the snakes

industry with in next 10 years

To attain at least 30% market share of snakes industry within the next 10 years
To compete in the market on quality behaviors, not on price strategies

To earn minimum 30% profit on each unit from the day first

BANANA CRAZEE= A Product by Frito Enterprisez~ 5 ~

Section 02:

The Business (Description)

To establish their own national distribution network within next 12 15 years

To nationalize our firm at least 20 years to their existence
To maintain the harmonic relationships with their suppliers for the quality concerns
To provide a sufficient return to investor from our net profit

Competitive Advantage
We are offering a unique product to market with good
quality, excellent taste & at reasonable price which will attract to
consumer. We are fully free in this segment of the snakes industry
till next two years minimum. And two years is enough time to grasp
the huge market value. The major threat to our product is take over
from Lays, but it will be not easy for Lays. Because multinational
brands never want to lose their reputation in the host market
through negative propaganda towards other home product.
In the case of Lays threat, we have national slogan of Be Pakistani, Buy Pakistani, which
will provide us way to capture the market share. And, we are offering Halaal Food to market
under the Islamic Values. It is in our common observation that some years before, Lays had a blame
of Pig Fatty Oil in their chips, and Lays faced huge financial crises due to this unethical activity
in the Pakistans Market. These will be ours strong bases to walk in the snakes industry.
Another competition strategy is also present that we will merge themselves into Super
Crisps. This merger will provide us low fixed cost, national distribution network, brand name of
Super Crisp, etc. due to this merger Super Crisp may will be again attain the huge market share like
in past.

Current Status

BANANA CRAZEE= A Product by Frito Enterprisez~ 6 ~

Section 02:

The Business (Description)

Now, if we launch our product to 3 4 major cities of Pakistan which provide us the actual
behavior of our product towards people. Due to this limited launching strategy, we will prevent
ourselves from the huge loss which may occur in big launching. As the first mover in the fruity
snakes industry, may we will face various initial costs but all of these costs will be cover within
very small next period because our profitability on each unit is so much for the investor.
For the marketing concerns with respect to our competitors, we will promote our brand and
products by various promotional activities and extra benefits to distributors, retailers and also to
ultimate consumers. But it will be necessary for us to establish strong & solid distribution network
for the consumption of our product on each & every level.

BANANA CRAZEE= A Product by Frito Enterprisez~ 7 ~

Section 03:

Management Team

Section 03:

Management Team
For any organization, management is a first and last pyramid to handle the various
operations & matters of the organization. We, Frito Enterprisez is familiar with this important
aspect of the business. For the managerial affairs we will choose best one management personalities
from the market who will supervise to our business. The well trained & well qualified staff of
the organization is the responsible for their success. On the other hand, losers persons of the
management staff may responsible for the failure of the organization.

For the effective

management, we have following managerial posts as:

CEO/Chairman
Board of Directors
Finance Manager
Accountant
Marketing Manager
Production Manager
Quality Inspector
Coordinator
HR Manager
Asst. Cost Manager
Salesperson
Other Staff Members

BANANA CRAZEE= A Product by Frito Enterprisez~ 8 ~

Section 03:

Management Team

Organizational Structure

Frito Enterprisez Organizational Structure

CEO /
Chairman

Invest
or

Finance
Manage
r

Banker

Accounta
nt

Asst.
Cost
Manage

Producti
on
Manager

Advisor

Marketin
g
Manager

Coordinato
r

Quality
Inspector

Salespers

Complain
ant
Officer

Labor +
Skillma Business Consultant
n
HR Manager
Law Firm
Audit Firm

BANANA CRAZEE= A Product by Frito Enterprisez~ 9 ~

Section 04:

Legal Company Structure

Section 04:

Legal Company Structure

Our Firm Frito Enterprisez
Our firm Frito Enterprisez will be a Private Limited Company under the Companies
Ordinance, 1984. According to the law, a private limited company is an association of at least 2 but
may not exceed 50 members. This form of firm is restricted from the right of its members to
transfer their invested part within the company. It also prohibits to any invitation to the public to
subscribe their shares or debentures. It will be registered under the Companies Ordinance, 1984 and
corporate taxation law. All the members will entertain with the limited liability.
All the members especially investor & bankers join this organization under the Partnership
Act, 1932. Under this law, partnership is a voluntary association of two or more persons, who
contribute their money, property, time, skills knowledge, energy, ability & experience to carry on
business for the profit/loss sharing among each other. The partnership itself have no any legal
separate entity, all of members will partners under the head of some specific voluntary kind of firm,
which is registered by any law.

Legal Status of Frito Enterprisez

The legal structure of our firm Frito Enterprisez will be a company as private business of
various investors, bankers & skilled based persons who invested their money, time, experience &
abilities on risk basis & demand high rate of returns against them. The investor with 35% to the
total investment & banker with 25% of the total investment will be the members to board of
directors without any kind of eligibility criteria. And, CEO/Chairman, Coordinator & Legal Advisor
will invest their skills & experiences with the specific selection criteria. Our firm has skilled based
investment & money investment portfolio at the time with the different rate of returns on the total
invested money & abilities.

BANANA CRAZEE= A Product by Frito Enterprisez~ 10 ~

Section 04:

Legal Company Structure

In our partnership relationship, we have a lot of partnership deeds. All the partnership deeds
(agreements) should be disclosed in the first or statutory meeting of the board of directors. The
partnership deeds regarding CEO/Chairman, Coordinator & Legal Advisor will be discussed in this
meeting.
At the 5th of each month, firm will issue a special kind of document Fritoz Newsletter a
letter which will describes the firm news, policies, rules, regulations, strategies, plans, goals,
objectives & achievements of the whole organization. The duties & responsibilities of each staff
member will be mention in it which may increase or decrease on monthly basis. The confidential
matters will never to be disclosing in this document. This is a public document for our inner
structure of Frito Enterprisez.

Frito Enterprisez
Head Office Address:
Frito Enterprisez,
73 / A, Century Plaza,
Near Centre Point (Mini Golf),
Lahore, Punjab 35000
Assembly Line:
Frito Production Unit,
Near Suzuki Falcon Motors,
Lahore Road, Sargodha

BANANA CRAZEE= A Product by Frito Enterprisez~ 11 ~

Section 05:

Ownership & Intellectual Property

Intellectual Property
Our firm, Frito Enterprisez have no
legal status till now, but we will register
themselves as soon as possible in the first
aspect of the business.
When we will register ourselves, then
we will use this monogram as the identification logo of the firm. On each & every product or
service offer by us will have the mono. This monogram is the Trade Mark for us as the legal
status of the firm. It will be our first preference that we will show this trade mark on every offer
product in the market.
After the launching of product, we will give legal status to our production process as patent.
In general sense, we will register our assembly line with the name of Frito Assembly Line. The
purpose to get legal status for our production process is to eliminate the competitor role towards the
copy us. Our production process is the basic secret for our firm.

BANANA CRAZEE= A Product by Frito Enterprisez~ 12 ~

Section 06:

Industry Analysis

Section 06:

Industry Analysis
Industry Description
People demand the product according to their intuitions & preferences. We know that the 3 rd
World Countries are very habitual to adopt the Western Culture. Likewise, Pakistan is also in line
with those countries which have big potential do exist for investment in the Snacks Industry in
Pakistan as the Demand or Growth rate is very high. Annual Growth Rate of Snacks Industry is
estimated at the rate of 20 % - 30 % per annum.
Most of the children, teenagers and young people are the target market of the product and
we have the experience that the eating habits of the target market is rapidly changing and they like
to have snacks all the time. Further potato and corn snacks are labeled as a meal replacement and
being a light fast food is becoming popular. The life style is improving and going to be changed and
also because of satellite invasion the demand is bound to register a considerable boost.
Now, people are enjoying with the potatoes & corn chips in so many flavor but we want to
change the trend of nation from vegetable to fruit chips which are better for health. The opportunity
for our new trend product is present in the market. We want to get benefit from this gap and make a
profit.

Industry Size
In common practice, there are four phases present in the market regarding the Product Life
Cycle, Introduction, Growth, Maturity & Decline. Every sector of the economy is based on this
principle. The size of our industry is so large because each kind of person likes snacks. There are
few firms who fulfill this demand ay national level. We have a golden opportunity to enter in this
market with some heavy investment & take over the trend.
The demand of the present market is met by the mix of Branded and Unbranded Chips
available in the Market. There is 60% of the population which is Brand Loyal. However remaining
40% of the Un-branded Market can be attracted through heavy Advertisement Campaign.

BANANA CRAZEE= A Product by Frito Enterprisez~ 13 ~

Section 06:

Industry Analysis

On the basis of data collected and present survey of the market, current total market is
estimated at 2,000 Tons of Chips which is segregated as follows:
Segments
Branded
Unbranded
Total

Share %
60
40
100

Quantity (Tons)
1,200
800
2,000

Industry Attraction
The Snacks Industry of Pakistan is on growing phase and has a lot of potential to absorb
firms easily. The window of opportunity is open for us with the high growth rate. The Annual
Growth Rate of Snacks Industry is estimated at the rate of 20 % - 30 % per annum.
Under the export prospects for the next decade are very promising given the sustained and
continued expansion of the Fast Food Industry abroad. Further Tariff cuts under Trade Agreements
are anticipated. Low per Capita consumption of Fries in the overseas market is a strong indication
of future demand. These upcoming symptoms have a great potential to make huge profit.

Profit Potential
Profit generation is the basic parameter to execute the business. The sales trend of crisps and
snacks is increased by 10% between 2000 and 2005 to at their peak at 2,386 million. A decline of
3.5% in 2004, however, took retail sales to 2,303 million due to the implementation of taxation
structure of retailers.
According to our analysis, we are producing unique product which will provide us a huge
profit after the achievement of our breakeven with in maximum 4 years to their execution. The
behavior of Pakistans Market towards the unique products is so attractive. So, there are so many
chances to the generation of profit from this sector.

BANANA CRAZEE= A Product by Frito Enterprisez~ 14 ~

Section 06:

Industry Analysis

Target Market
Targeting a market is a critical factor in the marketing strategy of a company. The target
market should be in accordance with the companys goals and objectives. The target market for
Snacks Industry is comprehensive by nature because the children, teenagers and young people are
the target for our industry. Home, rather than school, is the most popular destination for eating
crisps and savory snacks, with seven in ten children (70%) consuming them at home, against
around half (48%) who eat such snacks at school.
According to our marketing strategy, we will target first of all to colleges & universities of
major three cities. After the possible response from these cities we will take next step towards other
cities. After one to spot launching, we will start our work for the establishment of national
distribution network. We will establish this network within next 10 12 years, which include each
& every street of the Pakistan.

Competitive Position
The competitor analysis for Snacks Industry of Pakistan regarding marketing affairs is easily
understandable by this table, which provide segmented percentages as,
Super Crisp Super Crisp is the market leader with maximum market share of almost near
40%. Now they are in big threat due to lays. The age segment for Super Crisp ranges from 5 20.
Golden Chips The sale price of golden chips is Rs. 5. They are targeting to Sec B & C.
Kolson Chips Kolson successful products include Slanty. They have chips but they are not
successful and usually not regularly available.
Pringles Pringles is imported from other countries by P&G. They are hygienic, best
quality crisps and they are quite expensive. Pringles are targeting to Sec A1 & Sec A2.

BANANA CRAZEE= A Product by Frito Enterprisez~ 15 ~

Section 06:

Industry Analysis

Chips Manufacturing Plants Currently in Operation

Following are the major and leading Producers of Potato Chips (Crisps) in Pakistan. The
Crisps are being produced by direct Potato Cuts/slices and also by Extrusion Process. However,
there is not a single Frozen French-Fries Producing Company / facility in Pakistan.
Sr. No:

COMPANY NAME

BRAND

1-

Standard Foods (Pvt.) Limited

NAME
Golden Chips

2-

Tripple EM (Pvt.) Limited

Super Crisps

345-

Kohinoor Smith (Pvt.) Limited

Consolidate
Trading Enterprises

Smiths
Kolson
Krincles

We know that all of these firms are operating in the vegetables snacks not in fruit snacks like
us. It will be a competitive advantage for us to produced a unique product for the market and
generate heavy profits. All of our competitors are strong but in condition to change the trend of the
market due to their brand reorganization at the national or international level.

BANANA CRAZEE= A Product by Frito Enterprisez~ 16 ~

Section 07:

Business Strategies

Section 07:

Business Strategies
We are producing Consumer Goods which are purchased by ultimate user from retailer
outlets for their own personal usage. Within the head of consumer goods, we are producing
Convenience Goods most of the time these goods are purchased in small quantities and have a
low unit value. The profit margin on convenience goods is not so much as like other kinds of goods.
According to the term Marketing Research the systematic design, collection, analysis &
reporting of data relevant to a specific marketing situation facing an organization. We have
conducted marketing research through questionnaires in our target market.
Survey Research the most widely used method for primary data collection, is the approach
best suited for gathering descriptive information. A company that wants to know about peoples
knowledge, attitudes, preferences or buying behavior can often find out by asking them directly.
The questionnaire of our marketing research is attached in the Appendix.

Product Feasibility & Strategy

Our product Banana Crazee, the modified form of Banana Chips in the national market
of Snacks Industry will may change the trend of people from vegetable snacks towards the fruit
snacks. Thats why the slogan of our product is Banana Crazee the taste of nature.
In our initial launching, we are introducing two products of Banana Crazee with different
tastes to understand the behavior of the market & customer towards the fruit snacks as,
BANANA CRAZEE Saltiest
BANANA CRAZEE Chill Up

Banana Crazee Saltiest:The salty flavor of snacks especially for kids & health
conscious people who avoid from the high fats & sugar. The neutralized iodized (0.025%) salt will
be added in this product for the taste & ultimate flavor.

BANANA CRAZEE= A Product by Frito Enterprisez~ 17 ~

Section 07:

Business Strategies

Banana Crazee Chill Up:The chilly flavors of snacks for young people especially
for girls who demand something chill in their food. Various kinds of masalas and magnesium salts
will be added in this product for the taste.
We are introducing two packing for both flavors as,
Mini Pack Banana Crazee = 30 Grams with Rs. 20/= for consumer
Midi Pack Banana Crazee = 65 Grams with Rs. 35/= for consumer
Product
Banana Crazee
Banana Crazee

Taste
Saltiest
Chill Up

Weight
30 Grams
65 Grams

RP (For Mini Pack)

Rs. 20/=
Rs. 20/=

RP (For Midi Pack)

Rs. 35/=
Rs. 35/=

* RP = Retail Price price for ultimate consumer

* The Firms Profit + Distribution Channels Profit = Retail Price (RP)

The product analysis regarding their ingredients will be shown on the product design
(prototype) which is attached in the Appendix. The analysis of ingredients is determined by the
Forensic Department of Pakistan. The report of Forensic Department provides a satisfaction to our
product regarding the reverse engineering matters of our product, which are impossible due to their
unique kinds of tastes & items in it.
According to our price analysis, which is shown on next pages, we are in condition to
generate a great profit from each unit sold down in the market. The Trade Price (firms price for
their customers) is shown in this table as:

=
Price
firms
for

Product

Weights / Quantity

Banana Crazee

30 Grams / Mini

Saltiest
Banana Crazee

Pack
30 Grams / Mini

Chill Up
Banana Crazee

Pack
65 Grams / Midi

Saltiest
Banana Crazee

Pack
65 Grams / Midi

Chill Up

Pack

Master

TP for Master

Packing

Pack

Rs. 17/=

48 pieces

Rs. 816/=

Rs. 17/=

48 pieces

Rs. 816/=

Rs. 29/=

24 pieces

Rs. 696/=

Rs. 29/=

24 pieces

Rs. 696/=

TP of Each Unit

* TP
Trade

price
their

customers
* Master Packing = Cartons
* Mini Master Packing = (Rs. 17 48 pieces) = Rs. 816/=
* Midi Master Packing = (Rs. 29 24 pieces) = Rs. 696/=

BANANA CRAZEE= A Product by Frito Enterprisez~ 18 ~

Section 07:

Business Strategies

Marketing Strategies
We are discussing four marketing strategies which will may valid for next 15 years of the
business life. All of these strategies are based on the time period to launching the product in any city
or part of the Pakistan.

Initial Launching Marketing Strategy

Phase Marketing Strategy
General Marketing Strategy
National Marketing Strategy (Appendix)

All of these strategies have following terms which are used by Frito Enterprisez for their
marketing plans & promotions as:
Discount Package
Free Scheme
Extra Benefits Allowance

Discount Package under this sales promotional package, we are giving various kinds of discounts
to distributors, retailers & also consumers for attract their attention towards us. The discount range
in this package is 2% - 15% according to time & situation.
Free Scheme under this sales promotional package, we are giving free units (in master packing)
on the master packing sales of cartons in big quantity. This scheme is valid only for distributors &
retailers. The range of master packing is varies from 1 carton 7 cartons.
Extra Benefits Allowanceunder this promotional package, we are offering so many kinds of
various things which will provide benefits to retailers & consumers not to distributors. Following
things are giving under this package as:

Product Display Stands

Publicity & Advertisement Material
Display Allowances
Discount Cards to Loyal Customers
Extra Discount to Anyone (0.5% - 3.0%)

Initial Launching Marketing Strategy

BANANA CRAZEE= A Product by Frito Enterprisez~ 19 ~

Section 07:

Business Strategies

When we want to launch our product in any area of the Pakistan, then this initial strategy for
marketing & promotion will be implement for the penetration into the market as soon as possible.
Before 10 days to launching the product in any area, we will start our promotional activity which
includes, pamphlets, Banners, FM Adz, Cable Adz and Sign Boards Flexes. The quantity for this
promotional budget will vary with respect to the specific area & our promotional budget. All of this
promotional campaign will manage by Marketing Manager.
When we launch our product into the market, then we will never target to the distribution
network of this specific area, we will directly target to retailers & consumers who provide us value.
This penetration strategy wills breakdown the monopoly of distributor regarding our product. We
will introduce our product at initial level to colleges & universities of the specific area. The
canteens of these institutions will provide us demand in students & also in local market.
Under the Discount Package, we will provide 15% discount to our retailer or canteen owner
on retail price (RP) of each master packing for either (Mini- or Midi Pack). Under the Free Scheme,
we will offer him 2 Free Carton with 10 Mini Pack Cartons & 1 Free Carton with 10 Midi Pack
Cartons. It is the fully choice of retailer or canteen owner either he select Discount Package or Free
Scheme but not both.
Under the Extra Benefits Allowance, we will provide him 1 stand on the net purchase of 3
cartons of anyone master packing. If he wants to purchase more than 3 cartons, then we will provide
him 2 stands on the net purchase of 5 cartons. At least one stands is compulsory for each retailer or
canteen owner. We will provide one banner to each retailer and 100 pamphlets without any kind of
cost for their counter display on each delivery.
If we conduct any Spot Activity for consumers then we will provide him 40% discount on
the retail price. This spot activity must be sponsor by Frito Enterprisez may on the behalf of some
retailer or any other entity. For the conduction of spot activity, our Marketing Manager will manage
whole campaign.
This strategy will be valid till after 30 days to the introduction of the product in the market.
After 30 days, we will move towards the next scheme.

Phase Marketing Strategy

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Section 07:

Business Strategies

After the 30 days to the launching of product, we will implement the Phase Marketing
Strategy. Under this strategy, we will provide 10% discount to each retailer on retail price (RP)
under the activity of Discount Package. If he want to enjoy with the Free Scheme, then 2 Free
Cartoons with 10 Mini Pack Cartons & 1 Free Carton with 10 Midi Pack Cartoons. This scheme
is same as like in previous strategy. Like previous strategy, it will be the fully choice of retailer or
canteen owner either he select Discount Package or Free Scheme but not both.
Under the Extra Benefits Allowance, we will provide him 1 stand on the net or credit
purchase of 3 cartons of anyone master packing. If he wants to purchase more than 5 cartons, then
we will provide him their demanded number of stands. At least one stands is compulsory for each
retailer or canteen owner. We will provide one banner to each retailer and 100 pamphlets as
promotional activity to their counter display on each & every delivery.
If we conduct any Spot Activity under the Phase Marketing Strategy for consumers then
we will provide him 40% discount on the retail price. This spot activity must be sponsor by Frito
Enterprisez may on the behalf of some retailer or any other entity. For the conduction of spot
activity, our Marketing Manager will manage whole campaign.
This strategy will be valid till the allocation & deal of any distributor in the specific area.
Under our projection analysis, we will get no more time to the allocation of any distributor for our
product. According to Market Analysis, we demand just maximum 5 months for the execution of
any distribution in specific area, where we already has launched our product.

General Marketing Strategy

When we have our own distributor in the specific area where we have already launched our
product, then we will implement our General marketing Strategy. This strategy is just valid for
Distribution Network, if in any case the distribution network will may not establish in the specific
area within 5 months to launching of our product. Then we will continue the previous strategy till
we establish our sole in this area.

BANANA CRAZEE= A Product by Frito Enterprisez~ 21 ~

Section 07:

Business Strategies

Under this Discount Package, we will provide Rs. 1.5/= on Mini Pack &Rs. 3/= on Midi
Pack, on each unit without any kind of carriage expenses. And, distributor will provide Rs. 1.5/= on
Mini Pack &Rs. 3/= on Midi Pack, on each unit to retailer, all carriage expenses of distributor
will less from this profit margin of retailer. Except from this profit margin on each unit, we will
provide 1 Free Cartoons with 10 Mini Pack Cartons & 1 Free Carton with 15 Midi Pack
Cartoons under Free Scheme.
Under the Extra Benefits Allowance, we will offer following this to each distributor as our
authorized dealer in the specific area, which jurisdiction is allocated by our Marketing Manager.

All the expenses of carriage till the delivery in the hands of the distributor
He have ability to demand sufficient stands according to their requirement
He have ability to demand enough promotional material as their requirement
All the advertisement expenses will be bear by the firm
Firm will allocate a sufficient balance for the retailers as their Display Allowance which

given on the behalf of the distributor

The Usage of Display Allowance is in the hands of distributor with specific evidence
The Marketing Manager have ability to give 0.5% to 3.0% extra discount to any
distributor on the behalf of their huge delivery & repeat sales behavior
If we conduct any Spot Activity under the General Marketing Strategy for consumers then
we will provide him 35% discount on the retail price. This spot activity must be sponsor by Frito
Enterprisez just on the behalf of our distributor who gain the profit 5% of the total sales in this spot
activity as their profit margin. For the conduction of spot activity, our Marketing Manager will
manage whole campaign.
This strategy will be valid for the implementation of new strategy for any distributor.

BANANA CRAZEE= A Product by Frito Enterprisez~ 22 ~

Section 07:

Business Strategies

Pricing Strategies
We knew that price competition is the core element in the free economy. For setting prices
of products various kinds of supply & demand forces shows their behavior in the general market.
The companies are not freely independent to charge their prices from customers according to their
demand.
We allocate our prices or customers & consumers on the following basis according to this
given below pattern as:
Price / Cost
Total Variable Cost
Carriage Expenses
Selling Commission
Total Cost Per Unit
Fixed Cost Reserve
Firm Profit
Trade Price (TP)
Distributor Margin
Retailer Margin
Retail Price (RP)
Weights (in grams)

For Mini Pack (in rupees)

7.35
0.50
0.50
8.35
1.00
7.65
17/=
1.50
1.50
Rs. 20/=
30 Grams

For Midi Pack (in rupees)

14.15
0.50
0.50
15.15
1.00
12.85
29/=
3.00
3.00
Rs. 35/=
65 Grams

* Total Variable Cost = represents the cost of product which firm bear to produce a product which will be discussed in the Appendix
* Carriage Expenses = all the expenses which firm will bear to transport the product in the hands of distributor or retailer
* Selling Commission = Rs. 0.50 or each unit will be equally divided into the Marketing Manager & specific Salesperson who sold this
unit
* Fixed Reserve Cost = a reserve which may used for any affair of the firm may be for the recovery of Fixed Cost by the instructions of
CEO/Chairman
* Firm Profit = This is the Gross Profit Margin of the firm which will used to pay various kinds of expenses & fixed costs to the operations
of the Frito Enterprisez
* Trade Price = a firm price for their customers but not for their retailers
* Distributor Margin = a gross profit for the distributor to operate their business
* Retailer Margin = a gross profit for the retailer which may includes the carriage expenses from distributor
* Retail Price = a price for the ultimate consumer who purchase our product from the retailer elsewhere in the Pakistan

BANANA CRAZEE= A Product by Frito Enterprisez~ 23 ~

Section 07:

Business Strategies

Promotional Strategies
Most of the promotional strategies are discussed in the product feasibility & strategy but for
more common practice, we also discuss various modes of promotional activities which choose by
our firm for themselves under the limitations of their budget.
We will start our various promotional activities since 10 days before to the initial launching
of our product in the specific area market. In our first 3 years, we will use following promotional
modes to convey our message towards the general public as:

Pamphlets
Banners
Voucher Billing Pads
Sign Board Flexes
FM Band Advertisement
Local Cable Advertisement

After the 3 years to the launching of our product, when we feel we are in better condition to
handle our brand value then we will target National Media for our promotional advertisements. We
will target PTV, Geo Network, Express Network and Duniya Network in possible time. Our first
preference for the national advertisement will be the prime time.
For the day first to next 5 years, we will provide following promotional activities &
customers behaviors activities for the loyalty of our brands as:

Toll Free Number on backside to product design

E Mail ID + Web link on the product design
Complaint Officer in the Head Office, Lahore
Garments with labeled promotional adz (as t shirts, bands, etc)
Shopping Bags
Calendars
Key Chains, etc.

BANANA CRAZEE= A Product by Frito Enterprisez~ 24 ~

Section 08:

Operational Strategies

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Section 08:

Operational Strategies

Quality Control
Frito Enterprisez is Quality Conscious organization, for the proper allocation of quality
affairs in our production process we are hiring a Food Quality Inspector for our own organizational
quality affairs. He will be responsible for the quality techniques which may implement on the
production operations. It is our first preference to produce minimum variation output for our
customer. For the quality enhancement program, we follow those techniques which are less costly
& greater beneficial for us.
Quality Statement

The quality is an integral part of our commitment to world class products. Our aim is to
provide zero defected and zero variation products to our consumers
For the Quality Enhancement Program in the Frito Enterprisez, we will use the Statistical
Process Control (SPC). According to SPC, we will use a statistical method for separating variations
from the special cause to natural cause, for the elimination of the special cause variations and
minimizing the natural cause variations on the continual basis improvements in the production
process.

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Section 10:

Critical Risks Factors

Section 10:

Critical Risks Factors

Management Risks

Production Wastage
Labor Conflicts
Low Coordination
Leg Pooling Environment
Conflicts in Board of Directors
Conflicts in Directors & Investor/Banker
Low Level Management Problems

Marketing Risks

The Market Breakdown

Any Market Crash
Lays As Competitor
Conflicts with Distributors
Decline in the Industry
Sudden Change in Trend

Operating Risks

Wastage During the Production

Low Quality of Bananas
Conflicts with Suppliers
Less Coordination in A/L
Less Working Environment in A/L
Conflicts b/w A/L Staff

Financial Risks

Less Capacity for Fulfill the Demand in first 5 years

Financial Crack Down in Market
Political Instability
Law & Order Instability

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Section 10:

Critical Risks Factors

Extra Money Utilize for Quality Enhancement

High Wastage Dumping Cost
Energy Crisis
Lays Financial Take Over

Intellectual Property

Govt. Banned Policies

Decline in Goodwill by Competitor
Stolen of Trade Secrets
Legal Copy of Copyrights
Public Rules & Regulations

Other Risks

High Taxation
Inflation Trends in the Market
Decline in the Value of Money
Rising Prices of Raw Material
Govt. Food Department Conflicts
Appendix
10 Years Capital Requirements

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PORTERS FIVE

FORCE MODEL

The Bargaining Power of Buyers

The power of buyers is the impact that customers have on a producing
industry. In general, when buyer power is strong, the relationship to the
producing industry is near to what an economist terms among op son y a market in which there are many suppliers and one buyer. Under such
market conditions, the buyer sets the price. In reality few pure
monopolies exist, but frequently there is some asymmetry between a

BANANA CRAZEE= A Product by Frito Enterprisez~ 30 ~

producing industry and buyers. The bargaining power of the buyers is

low in the country. Because what so ever is producing by the companies
it is accepted by the consumers. There is no involvement of the
consumer in deciding the taste of the soft drink.
The Bargaining Power of Suppliers
A producing industry requires raw materials - labor, components, and
other supplies. This requirement leads to buyer-supplier relationships
between the industry and the firms that provide it the raw materials used
to create products. Suppliers, if powerful, can exert an influence on the
producing industry, such as selling raw materials at a high price to
capture some of the industry's profits.
All the sellers of the raw material are in India and other part of world. If
any of the suppliers raises its prices, we can shift to another supplier.
Barriers to Entry / Threat of Entry
It is not only incumbent rivals that pose a threat to firms in an industry;
the possibility that new firms may enter the industry also affects
competition. In theory, any firm should be able to enter and exit a
market, and if free entry and exit exists, then profits always should be
nominal. In reality, however, industries possess characteristics that
protect the high profit levels of firms in the market and inhibit additional
rivals from entering the market. These are barriers to entry.
There are no barriers to entry in the soft drink processing industry,
because the machinery, labor and raw material is readily and easily
available in the country. The retaliation level of the companies in the in-

BANANA CRAZEE= A Product by Frito Enterprisez~ 31 ~

dustry is very low. Because the companies have generations of the loyal
customers
New entrant to a an industry bring new capacity a desire to gain market
share and position and quite often , new approaches to serving
customer .new player means price will pushed down ward and margins
squeezes . Its resulting means profitability will be low in long run. (This
decisions was.by Michel E porter, completive strategy 1980 pp7-33
Rivalry
Rivalry among firms refers to all the actions taken by firms in the
industry to improve their position and gain advantage over each other.
The market structure of the soft drink industry is oligopolistic. All the
companies in the industry are charging the same prices against there
products. If any of the company enhanced the prices of the soft drink, all
the companies followed the same path. The firm with high strategic
stakes in achieving success in industry genially are destabilizing because
they may be willing to accept below average profit margins. There are
few firms in the industry like coke cola, thump up, Zaire masala, etc. and
all the firms are competing on the basis of the huge marketing
campaigns in the media to established themselves hold position or
expand . (Our goal is to shrink the profit pool and take the biggest
slice .by Kevin Rollins, president and COO, dell Inc. The magazine THE
MARKETE Feb. 2010).(global marketing warren &mark2005 4thedu
pg.505)
Threat of Substitutes

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 In Porter's model, substitute products refer to products in other

industries. A threat of substitutes exists when a product's demand is
affected by the price change of a substitute product. A product's price
elasticity is affected by substitute products - as more substitutes become
available, the demand becomes more elastic since customers have more
alternatives. A close substitute product constrains the ability of firms in
an industry to raise prices. (Michel E porter, completive strategy 1980
pp7-33)
The direct competitor of the Pepsi drink and indirect competitors are
fresh juice tea coffees but it is costly in the country, so we can say that
there is threat from the substitute product

The BCG growth Share Matrix

Boston Consulting Group (BGC) pioneered an approach

called portfolio techniques that attempted to help
managers. Balance the flow of cash resources among
their various businesses while identifying their basic
strategic purpose within the overall portfolio. The market
growth rate on the vertical axis indicate the annual
growth rate of the market in which the business operate
(kotler 2005,pg.94.john.A .richard .B strategic
management by 2011 edu.ch 8.)

BANANA CRAZEE= A Product by Frito Enterprisez~ 33 ~


(Sources of information www. ayushveda.com)

As mentioned above, this study aims on analyzing the

products and services offered by PepsiCo. The BCG matrix
approach is based on the product life cycle concepts
which can be utilized to identify what priorities should be
given in the product portfolio of a business level. The
product portfolio analysis of the PepsiCo using BCG Matrix
analysis. Accordingly, PepsiCo is consisted of 5 major
brands: Gatorade, Quaker, Pepsi products, Frito-Lay and
Tropicana

Question mark
With this, it shows that the products that belong to the
question mark are Gatorade, Pepsi cola and also
Tropicana. Because of the emergence of different healthy
drinks and beverages in the global market, the market
share of Tropicana and Gatorade are being threatened.
Accordingly, question mark category means that these

BANANA CRAZEE= A Product by Frito Enterprisez~ 34 ~

products have a low share of a possible high growth

market and may become a star product because of the
positive response of the customers. (Annul reports 2009)
Star category
As can be seen in the figure, the services that fall in star
category are is the pay-is Pepsi brands. The star category
shows the products with a high share of a gradual growth
of market and these products have a tendency to produce
high amount of profits.(annual report2009)
Cash cow
The next category that can be seen in the figure is the
cash cows. Herein, the products are considered to have a
high share of a slow growth market (Annul report 2009)
The PepsiCo, services that can be considered in the cash
cows are the Quaker
Dog
Lastly, it can be seen that walker potato crisp, diet Pepsi
and Frito-Lay are products that can be considered in the
dogs category. It can be said that PepsiCo has been able
to market their products and increase their market share
and market growth by using different strategies and approaches. The company enhances the market share of
their brands by considering different marketing entry
modes.

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