Frozen food (K&Ns)

(Advanced Managerial Economics)

Assignment
Submitted by:

Aqsa Tahir

SP13-MBA-008

Hassan tariq

SP13-MBA-021

Junaid Zafar

SP13-MBA-027

Mohammad Bilal Chishti

SP13-MBA-040

Muhammad Jawad Haider

SP13-MBA-042

Class: MBA 5

Submission Date: 12 May, 2015

Submitted to: Sir Naeem Ahmed

Department of Management Sciences

COMSATS Institute of Information Technology, Islamabad
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Product
K&Ns Frozen Foods (Chicken)
Suppliers of the product
K&Ns maintain their own poultry farms and slaughter houses for the
processing of chicken. Products are stored at -21C to maintain freshness.
Packed products are moved into K&Ns sanitized refrigerated trucks for
distribution to ensure uncompromising quality control. They have their
own distribution channel they are both forward and backward integrated
or vertical integrated.
K&Ns chicken products are available at K&Ns Chicken Stores and leading
retailers and also delivered to quality and food-safety conscious
institutions such as hotels, restaurants, airlines, clubs and international
restaurant chains.
Factors that determine the substitutability among these products
The price and the range of the product is the main reason of
substitutability. Price is the biggest reason for the substitutability of the
product because the competitors like PK Food, Menu, Mano salwa, and Suf
charge less price for the same product rather than K&Ns. Other than that
other competitors also provide beef, mutton and sea foods which also
divert the customer towards their chicken products. But through our
survey we had seen that more than 60% of the population buys K&Ns
chicken product.
Product differentiations
The brand is growing rapidly day by day due to the customer satisfaction
and the product is according to the customers requirement as well as
they are targeting different segments of the markets like children and the
vegetarians.
Positive points of K&Ns product:

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From the customer view point K&Ns is providing healthy food. It is easy to
cook especially it facilitates the working women because they dont have
much time to make all those things in home. They are targeting the
children as well through fun nuggets and burger patties so women are
using for their children lunch. This brand provides the hygienic food to its
customer that build trust in the customer. Moreover the taste of K&Ns
food is superior then others. These attributes are increasing its market
share and this brand is growing.
K&Ns also provide non-frozen food that is STOK (chicken cubes). They
also have their own franchises which only sell K&Ns products.
Market structure categorization using Herfindahl index
From the survey we had fnd that 60% of the population buys K&Ns
products while 10% buys Menu and PK Food products each, while the
other 20% is divided among the other 4 to 5 suppliers in the market like
Mano salwa, Islamabad Foods, Dawn, Suf etc. so
Herfndahl index can be calculated as:
(.602+.102+.102+.202) = 0.42% or
10000*(.602+.102+.102+.202) = 4200
From this we can see that the market is somehow highly concentrated and
there is also room for new entrants, there is a moderate completion
among the supplier of the products. There is no monopoly or oligopoly in
the industry as the index is not reaching 10000 or near to it but it may
seem as a monopolistic competition in this sector as it is above 2000 and
as it is not equal to or nearer to zero so we cannot say it is a perfect
competition. There are few suppliers in the market and the number is
growing. Price of the product and taste are the main reason of the
competition.

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