P3:

Introduction

PRAN (Programme for Rural Advancement Nationally) was established in 1981 by retired Major
General Amjad Khan Chowdhury. PRAN has become one of the largest food and beverage
brands in Bangladesh and has been exporting products to 138 countries.  Pran pioneered agro
business in Bangladesh. They provided farmers with guaranteed prices. Pran Foods, a sister
concern of PRAN-RFL Group, produces a number of agro products under the banner of PRAN.
Pran established a subsidiary company in UAE in 2003. In 2008, the company announced plans
to open a production facility in Tripura, India, after the Indian government lifted the ban on
direct investment from Bangladesh in 2007. Pran's exports had reached 10 billion taka value by
2016, the biggest markets for the company were India, Saudi Arabia, the UAE, Malaysia,
and Oman. The same year the revenue for Pran exceeded US$500 million. PRAN started
exporting potatoes in March 2016. In April 2016, PRAN started to export cassava, the first
shipment, worth US$3 million, was exported to New Zealand. PRAN has 80 thousand direct
employees and 200 thousand indirect employees. PRAN exports to 118 different countries.
(PRAN-RFL Group, 2019)

PRAN-RFL would export various furniture that includes plastic chair, dining table, coffee table,
clothes hanger stand, stool etc.
 Assessment of the Product life cycle stage of PRAN-RFL (Plastic furniture)

Assessing the product life cycle is essential in marketing to decide upon various strategies and
the appropriate time for advertisement, price, new markets development or manufacture of
new packaging.

The product life cycle analysis is a tool which can be used as a part of the strategic analysis step
in the overall process of strategic planning:

 strategic analysis 
 strategic choice  
 strategic implementation

The product life cycle is the life-span of a product. It is the time period over which any
particular product is developed and is introduced into the market and gradually but eventually
expires from the market. The product life cycle is divided into four stages: introduction, growth,
maturity and decline.

In order for RFL to identify current status of the product in the market and make better
decisions for modifications and development in the marketing strategy for the product, it is
critical to assess the position of RFL furniture in the Product Life Cycle.
The plastic furniture of PRAN-RFL can be said to be in the Growth stage. This is because in the
current period the products are eventually and increasingly gaining acceptance among
consumers, the industry, and the wider general public. The products and the innovation are
currently accepted in the market, and as a result sales and revenues have started to increase.
Profits have begun to be generated.

Features of the growth stage:

 Costs reduced due to economies of scale: as production and distribution are ramped up,
economies of scale kick in and reduce the per unit costs.
 Sales volume increases significantly: as the product increases in popularity, sales
volumes increase.
 Profitability begins to rise: revenues begin to exceed costs, creating profit for the
company
 Public awareness increases: through increased promotion, visibility and word of mouth,
public awareness grows.
 Competition begins to increase with a few new players in establishing market
 Increased competition leads to price decreases: price wars may erupt, technology may
get cheaper, or other factors can ultimately lead to falling prices.

All the above features go along with the current condition of plastic furniture of PRAN-RFL
hence it can be said that they are in the Growth stage of the Product Life Cycle.
 Three levels of Product development

The Three Product Levels model by Philip Kotler provides a way to understand the

different levels of need a customer has for a product. The 3 levels are as follows:

(Expert Program Management, 2018)

The core benefit is the fundamental need that the customer satisfies when they buy the
product.

The actual product is the product features and its design. Products typically have lots of
features but very few actual benefits (core benefits) to the customer.

The augmented product is any non-physical parts of the product. Typically, the augmented
product includes such things as warranty and customer service. 

In the case of plastic furniture -

Core product: comfort, relaxation, facility for dining, organizing clothes

Tangible product: variety of colors, armrest, stands

Augmented product: aftersales installation, 5 years warranty

 Export selection and justification

PRAN-RFL would export their plastic furniture to Germany.

Global usage of plastics is huge and global production is increasing. Germany is an interesting
market for suppliers from developing countries. Recycling of plastics and production of plastics
from environmentally friendly materials are becoming more important and popular.

European import of plastic parts and components increased by 7% per year between 2011 and
2015, amounting to €19 billion. Plastic parts and components were mostly imported from
countries within Europe. However, imports from developing countries showed faster growth
with 11% per year over four years’ time. In 2015, imports from developing countries
represented 15% of all European imports.

Germany is the largest importer of plastic parts and components, followed by France and the
United Kingdom. In 2015, the import from developing countries increased to €497 million in
Germany. Germany’s absolute growth of imports from developing countries is €152 million.

In the coming years, the increase in European imports of plastic parts and components is
expected to continue. Growth is estimated at 3 to 8% per year, depending on economic
developments in Europe and the individual country. This growth forecast reflects, among other
things, the trend of a greater demand for lightweight products.

The major share of the demand for plastic parts and components will continue to be met by
local European production. However, the import from low-cost countries, including developing
countries, is forecast to show an increase above average. European demand for plastic parts
and components decreased by almost 4% in 2012 to €28 billion. However, the demand
increased again in the years afterwards, reaching €33 billion in 2015.

Germany, France and Italy are the largest markets for plastic parts and components. Together,
they represented 64% of the total European market.

(CBI, 2019)
 Standardization and Adaptation choice

Product standardization refers to the process of maintaining uniformity of products and

services sold in different markets or in other words setting identical characteristics for a
particular good or a service.

Product adaption refers to the process of modifying the existing products in order to reach
to each market.

PRAN-RFL would go for Standardization in Germany as plastic products does not require much
of Adaptation in any cases; further reasons and justifications are provided below:

Benefit for PRAN-RFL Benefit for Customers

 Reduction in cost – Materials can be
purchased in bulk quantities and this
will lead to have discounts in
purchasing. At the same time, this
will cause less wastages in material
usage as well and reduces the cost.
 Production efficiency – The
production process becomes efficient
due to enabling factors such as mass
production, specialization of labour,
automation of the processes of
production.
 Well established and well-
strengthened brand – When an
identical product is being available in
different markets it would help
PRAN-RFL to establish and
strengthen the brand.
 Increase in production – When the
differences among products are
reduced the production can be easily
increased.
 Customers are enabled to choose
the exact product that they want –
When the differences among the
products are reduced then the
customers are not required to
confuse as to which product or
service to buy. So that they can
choose the exact product without
any confusion.
 Can obtain a high-quality product –
When the products are standardized
consumers can obtain relatively a
high-quality product.
 Better living standards – When the
consumers are capable of consuming
high-quality products at lower costs
their living standards gradually
increases.
 Market testing

Market testing is the process of assessing the viability of a new product or service and finding
out about consumer’s needs and preferences through organized gathering and analysis of data
before going for the launch. There are many ways PRAN-RFL can conduct market testing. Not all
market testing methods are appropriate for all marketing situations. Appropriation of the
technique is essential to efficiently conduct market testing and derive the required information,
fulfilling the purpose. To efficiently conduct market testing, PRAN-RFL should consider the time,
cost, accuracy, validity and response rate correlating to the purpose.

Field trials would be conducted providing detailed information about their offered products
where people would be able to use and test the furniture for its strength. They will also be able
to compare with wooden furniture and plastic furniture of other brands. The feedback would
be collected in the form of a survey questionnaire which will be analyzed later.

Product Launch

PRAN-RFL would arrange a commercial launching ceremony in the capital city, Berlin in the
presence of national media and officials of relevant business organizations, to be invited
formally through an invitation card.

Influencers would be reached for endorsements of the furniture. The endorsers would be
chosen from the people who have participated in field trials of the furniture and as well as who
have a good reputation or expertise in the relevant industry.

Upon arrival in the official launching ceremony, the attendees would be provided with the
launching plan including the activities and its timings. The launching ceremony would be of a
standard duration where customers and potential clients would be able to interact to make it a
productive and effective ceremony.
 Distribution

Germany is a large country providing huge opportunities for growth and expansion and hence
the distribution setup needs to be planned effectively and efficiently. The distribution in
Germany would be done keeping in mind the factors below:

 Company Capacity
 Customer requirement availability
 Product price
 Competitor’s strategy
 Level of Control

After the launching ceremony PRAN-RFL will go for a full-scale distribution in the country
through both direct and indirect distribution system. The focus will be mainly on the indirect
distribution system as it will help in penetrating the market quickly. The dealers would be given
commissions as incentives depending on their sales.