Executive Summary

It is the ultimate objective of a business leader to see the continuous growth of the business
and this growth can be achieved through a set of successfully laid down business strategies.
Such strategies cannot be formulated overnight and need careful analysis on organization’s
macro and micro environment along with the evaluation of the industry that the organization
is playing in. PESTLE analysis is the best tool to evaluate external environment while SWOT
analysis analyses the internal environment. Michael E. Porter came up with a model known
as five forces model which can be used to analyze the attractiveness of a specific industry.
Using all these models, Antler Industries (Pvt) Ltd has been analyzed followed by the
suitable growth strategy which is market penetration strategy being recommended to achieve
corporate objectives of the next five years timeline of Antler Industries (Pvt) Ltd.
Contents
1. Task one – Company Background....................................................................................................3
1.1 PESTLE model...........................................................................................................................3
1.2 Assessing industry attractiveness using Porter’s Five Forces model...........................................4
2. Task two - Evaluation of the Strategic Position of the Company......................................................5
3. Objectives for the company to be met within next five years’ time...................................................6
4. Strategic Direction of the Company..................................................................................................7
References.............................................................................................................................................9
1. Task one – Company Background
Antler Holdings history runs back to 1987 where it began its operations and has been
operating for three decades since its inception. In the beginning, Antler Holding’s main
operation was screen printing for fabrics. The company has been serving many fabric giants
such as MAS Holdings and many other well-known garments in Sri Lanka by providing total
screen printing solutions with closer to 1500 employees. The company then diversified into
few different areas and now there are four SBUs under Antler Holdings. They are Antler
Fabric Printers (Pvt) Ltd, Antler Industries (Pvt) Ltd, Antler General Industries (Pvt) Ltd and
Antler Information Technology Systems (Pvt) Ltd. For the purpose of the assignment, Antler
Industries (Pvt) Ltd is considered. Antler Industries (Pvt) Ltd is in to fast moving consumer
goods (FMCG) industry and it manufactures and distributes premium quality household care
items under the brand name of “Britol”. They are specialized in car care products and other
household care products [ CITATION www \l 1033 ].

Following is the analysis of company’s macro environment and industry attractiveness using
PESTLE model and Porter’s Five Forces model.

1.1 PESTLE model

Political Environment

Political environment is one of the main factors that can influence on a business. The
political crisis that emerged into a constitutional crisis has put the whole country backwards
in every angle and still their effects are there for the country. However this is expected to be
resolved soon and possibly in the end 2019, there will be a strong government just after the
parliament elections or presidential elections.

Economic Environment

The main economic issue that Sri Lanka has faced is the higher rate of rupee depreciation
against most of the major currencies in the world. This has resulted to have steep increases in
most of the commodity prices which in turn has resulted to increase the inflation. Therefore
these days the disposable income of people has gone down significantly.
Social Environment

Changes in people, society and culture are the main areas under social environment. Most of
the village areas of Sri Lanka are being urbanized. According to Nielsen Sri Lanka, few years
back Urban Rural classification stands at 25:75 but by now they expect that this has changed
to 35:65. People do not seem to be stuck with cultural barriers anymore and they tend to
break them and move forward.

Technological Environment

People have become so much technology oriented in past decades especially with the
availability of internet and also with the arrival of smart phones and tabs. Also the
manufacturers are also automating their manufacturing processes thanks to the technology.
With this they have been able to reduce the cost of manufacturing.

Legal Environment

Government has imposed many acts with the intention of saving the consumer as well as
manufacturers. Such acts include health and safety act, Inland Revenue act, competition
authority act industry disputes act.

1.2 Assessing industry attractiveness using Porter’s Five Forces model

Porter’s five force analysis [ CITATION Por98 \l 1033 ] is one of the well-known analysis used
to evaluate the attractiveness of an industry

Competitive Rivalry

FMCG industry is one of the most competitive industries in Sri Lanka with more than 5000
brands being available covering food and beverages, household care and personal care
products. All these sub industries under FMCG industry includes big multinational players as
well as local players such as Britol therefore the impact coming from multinational
companies on local companies is very high.
Bargaining Power of Suppliers

The bargaining power of suppliers on Britol is low because most of the ingredients are
sourced by Britol itself.

Bargaining Power of Buyers

Customers are having a higher bargaining power over Britol because they have so many
other similar manufacturers from whom they can buy products at a low switching cost.

Threat of Substitution

The threat of substitutes is also low for Britol because it is highly unlikely that products like
household care and car can be substituted by any other product.

Threat of New Entrants

There is a very high threat of entering new competitors to the industry since there is growth
potential in the industry itself. This attracts new players into the market and erodes the
individual profit margins from the industry.

2. Task two - Evaluation of the Strategic Position of the Company

SWOT analysis consists of an analysis of a company’s strengths, weaknesses, opportunities
and threats and is useful in analyzing the internal environment of a company. SWOT analysis
is a useful tool in the strategic planning process as it will clearly lay down the path to identify
the strategic direction of the company. When it comes to developing strategies, the company
should look forward to convert weaknesses in to strengths and threats in to opportunities.
Following is the analysis of SWOT for Antler Industries (Pvt) Ltd.

Strengths

There is a strong Research and Development facility within the company which is very
useful in bringing new products to the market or to make changes to the existing products.
This way, company can capitalize on the changing customer needs quickly by adjusting the
product portfolio with the help of Research and Development division.
Britol is currently offering products to general trade market as the main business operation.
Apart from that they have a business to business area also where they manufacture products
for private labeling purpose of clients such as Cargills Food City, Keells Super etc.

Britol has a good coverage in terms of distribution covering both Urban and Rural markets.

In Britol Industries, the product portfolio is relatively good covering all car care range and
household care range including Tile cleaners, washing powder, Disinfectants etc.

Weaknesses

The company has good plans for the future but at the moment company’s liquidity has faced
some troubles and as a result the company does not have a good amount of marketing budget
to execute those plans.

The target customers do not know Britol brand well like other famous brands. Although the
product is a good one, the product benefits and features are not well not communicated to
target customers well.

Opportunities

There are many other Fast Moving Consumer Goods (FMCG) categories that Britol is not
present at the moment so Britol can increase profits if they invest in other product categories.

Threats

There is a huge competition from the existing players in the market. These threats are mainly
coming from established multinational companies.

3. Objectives for the company to be met within next five years’ time
Objective 1 – To become the leading local manufacturer of household care products in Sri
Lanka.

Objective 2 – To increase sales revenue by 10% year on year growth until 2024.

Objective 3 – To increase market share by 7% by 2024.

Objective 4 – To automate 80% of manufacturing processes by 2024.

4. Strategic Direction of the Company

The ultimate objective of a business is to grow and achieve development and this growth
could be organic or non-organic. The growth can be achieve in four ways according to
Ansoff matrix which includes new market, New product, existing market penetration and
diversification. Which of these is to select is the next question that arise. Solution for that can
also be found in Ansoff matrix.

The Ansoff Matrix was developed by Ansoff (1957) and first published in the Harvard
Business Review in 1957; It has given generations of marketers a quick and simple way to
think about the risks of growth. It also helps us to analyze the risks associated with each one.

Figure 1: Ansoff product/Market matrix

Market penetration can be identified as the most convenient and low risky way to move
forward strategically. Here the focus becomes on to penetrate more and more in to existing
customer base while offering existing products. Including progressively advantageous
business areas or remote areas may likewise get to more clients in the current market.

Market development strategy includes developing new markets and offering existing
products to those new markets. Company can concentrate on other potential markets, can
develop through market improvement. This is particularly fine when contenders haven't just
focused on the new potential market. Organization could include outlet or merchant in new
geographic areas with insignificant or no challenge.

On the other hand, product development is the opposite version of market development
where new products are developed and offered to existing markets. This can be identified as
a high risk strategy because the company does not know how best the new products will
perform in the market.

Among the four given strategies by Ansoff, the most risky strategy is diversification but this
could actually give high returns to the company. Here the company will have to work on
developing new products and markets and offering those new products to the newly
developed markets. In this strategy, company does not have experience on the developed
products or the markets which makes the strategy risky.

The best strategy for Britol is market penetration strategy. This is because Britol is yet to
capture some of the areas in Sri Lanka due to limitations of distribution and also since there
are low level of brand awareness due to unavailability of enough budgets, company believes
that the existing product range of Britol is yet to penetrate the market and reach untapped
customers. This must be the strategy of Britol for the next five years period of time, if Britol
is to achieve the above identified objectives.
References

Ansoff, I. (1957). Strategies for Diversification. Harvard Business Review, 113-124.

Porter, M. (1998). Michael Porter on Competition. Harvard Business School Press.

www.antlergroup.com. (n.d.). Retrieved from www.antlergroup.com:

http://www.antlergroup.com/