Title: A Case Study of Brand Repositioning of Nurpur Milk

SHIRJEEL ANJUM
Reg. No: F1F17MBBA0036
University of Central Punjab

A PROJECT SUBMITTED TO FULLFILL THE REQUIREMENT FOR

THE DEGREE OF MBA MARKETING IN THE UNIVERSITY OF
CENTRAL PUNJAB.

July, 2019

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 ACKNOWLEDGEMENTS
I express my immense gratitude to Prof. Salman Arshad for his inspiring discussions, helpful
suggestions and the guidance during the preparation of this project.

In addition, I am thankful to my family members and friends, without their profound

understanding, encouragement, patience and love, the project would not have been successfully
completed. Finally, I acknowledge the Almighty ALLAH for His invaluable and abundant support.

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Table of Contents
1. EXECUTIVE SUMMARY ................................................................................................... 6
2. INTRODUCTION ................................................................................................................. 7
3. BACKGROUND .................................................................................................................... 8
3.1 COMPANY OVERVIEW (THE FAUJI GROUP) .......................................................... 8
3.2 BOARD OF DIRECTORS............................................................................................... 9
3.3 OUR VISION ................................................................................................................. 11
3.4 OUR CORE VALUES ................................................................................................... 11
3.5 AWARDS AND CERTIFICATIONS ........................................................................... 11
4. PRODUCT LINE & BRAND OF NURPUR ..................................................................... 12
4.1 Nurpur Original UHT Milk ............................................................................................ 12
4.2 Nurpur Original UHT Low-Fat Milk ............................................................................. 12
4.3 Nurpur Flavored Milk .................................................................................................... 13
4.4 Nurpur Lassi ................................................................................................................... 13
4.5 Nurpur Butter ................................................................................................................. 13
4.6 Nurpur Cheese ................................................................................................................ 14
4.7 Pasteurized Milk............................................................................................................. 14
4.8 NURPUR BRANDS ...................................................................................................... 15
4.8.1 Dostea- Liquid Tea .............................................................................................. 15
4.9 Must Fruit Drinks ........................................................................................................... 16
4.10 Taaza Chai Mix .......................................................................................................... 16
5. PESTEL ANALAYSIS ........................................................................................................ 16
5.1 Political Analysis: .......................................................................................................... 16
5.2 Economic Analysis:........................................................................................................ 16
5.3 Social Analysis: .............................................................................................................. 17
5.4 Technology Analysis: ..................................................................................................... 17
5.5 Legal/Law: ..................................................................................................................... 17
5.6 Environmental: ............................................................................................................... 17
6. SWOT ANALYSIS .............................................................................................................. 17
6.1 Strengths ......................................................................................................................... 17
6.2 Weaknesses .................................................................................................................... 18
6.3 Opportunities .................................................................................................................. 18

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 6.4 Threats ............................................................................................................................ 18
7. TARGET MARKET ........................................................................................................... 19
7.1 Demographical Segmentation: ....................................................................................... 19
7.2 Psycho Graphical Segmentation: ................................................................................... 19
8. MARKET ANALYSIS ........................................................................................................ 19
8.1 Growth strategy: ............................................................................................................. 19
8.2 Milk suppliers:................................................................................................................ 19
8.3 Sector Analysis ............................................................................................................... 20
8.4 Competitors: ................................................................................................................... 20
8.4.1 Nestle................................................................................................................... 20
8.4.2 Dairy pure ............................................................................................................ 21
8.4.3 Haleeb.................................................................................................................. 21
8.4.4 Olper’s ................................................................................................................. 21
8.4.5 Product Portfolio Comparison............................................................................. 22
9. NURPUR CHALLENGES.................................................................................................. 22
9.1 Factors that effects the Milk Industry: ........................................................................... 23
9.1.1 Natural factors ..................................................................................................... 23
9.1.2 Product quality: ................................................................................................... 24
10. MARKETING MIX ............................................................................................................ 24
10.1 Product (style and design): ......................................................................................... 24
10.1.1 Labeling ............................................................................................................... 24
10.1.2 Milk product development: ................................................................................. 24
10.1.3 Core Benefit of Product....................................................................................... 24
10.1.4 Product Design and New Product Development ................................................. 25
10.1.5 Future products .................................................................................................... 25
10.2 Price ............................................................................................................................ 25
10.2.1 Determination of price: ....................................................................................... 25
10.2.2 Pricing approach:................................................................................................. 26
10.2.3 Survey research: .................................................................................................. 26
10.2.4 Factors Affecting the prices of milk:................................................................... 26
10.3 Place/Distribution: ...................................................................................................... 27
10.3.1 Retail Outlets (indirect channel) ......................................................................... 27

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 10.3.2 Distribution and Warehousing: ........................................................................... 27
10.3.3 Marketing intermediaries /Physical distribution ................................................. 27
10.3.4 Distributors in Lahore ......................................................................................... 27
10.3.5 Distributors in Karachi ........................................................................................ 28
10.3.6 Distributor in Rawalpindi .................................................................................... 28
10.3.7 Market distribution orientation: .......................................................................... 28
10.3.8 Undifferentiated Marketing: ................................................................................ 28
10.3.9 Micromarketing ................................................................................................... 28
10.3.10 Retailers: .......................................................................................................... 29
10.4 Promotion: .................................................................................................................. 29
10.4.1 Advertising and Campaign / Event: .................................................................... 29
11. IMC OBJECTIVE ............................................................................................................... 31
12. IMC STRATEGIES ............................................................................................................ 32
12.1 Advertising ................................................................................................................. 32
12.2 Sales promotion .......................................................................................................... 32
12.3 Personal selling ........................................................................................................... 32
12.4 Direct marketing ......................................................................................................... 33
12.5 Public Relations .......................................................................................................... 33
13. POSITIONING STRATEGY: ............................................................................................ 34
14. CONCLUSION & RECOMMENDATIONS .................................................................... 35
15. References............................................................................................................................. 36

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1. EXECUTIVE SUMMARY

Pakistan is the 4th largest milk producer in the world, yet its share in the global milk market in
negligible and only 3% of the total milk production is being processed. Overall, the contribution
of dairy sub-sector to national economy is Rs.540billion (with 97% as informal non-documented
economic activity) and it is expected to grow at 4%. There is potential in the country for grooming
of this industry. The Noon Group is well reputed business group in Pakistan. Noon Group has been
in manufacturing and trading business since 1964 and due to its devotion toward serving its
customers, it has also emerged as well established & widely respected group within the Pakistan
industry. The company Noon PAKISTAN Ltd. (Nurpur Milk) was incorporated in 1996, with a
paid-up capital of Rs.5 million and a total investment of Rs.18 million. In the private sector, noon
Pakistan Ltd. Was the first company in Pakistan to operate a Spray Dryer for milk powder
manufacturing and its product namely as milk powder, butter and cheese are marketed throughout
Pakistan under the brand name of Nurpur.
Pakistan is considered among the foremost raw milk producing countries. different to
production systems in developed countries, milk production systems in Pakistan represents
smallholders with subsistence or market-oriented agriculture. Followed by peri-urban or
commercial agriculture. Historically, the dairy sector has owned and managed by the private
sector. Over the past two decades, new Initiatives have been taken due to the active participation
of private companies. sector. These efforts have resulted in improvements such as the expansion
of herds and import of high-quality milk germ plasma, productivity per animal, the lesson,
processing and marketing, supply of dairy supplies (machinery, equipment, farm animals, semen
and elite, and farmers' knowledge and skills. in modern management practices.

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2. INTRODUCTION

We are a tradition that began in the small town of Nurpur over 50 years ago. Noon Pakistan Limited
was established in Pakistan on September 26, 1966 as a limited public company and the company
is listed on the Karachi Stock Exchange and on the Lahore Stoke Stock Exchange. Nurpur is a
member of the Noon Group of Companies and is being supervised and managed by highly
qualified, experienced, technical and business senior managers and executives. Nurpur is in the
fourth number in 2014 according to the volume of sales in Pakistan. The Company has achieved a
682.73% growth in turnover over a period of four years. The turnover of the Company has
increased from Rs.311.27 million in 2004 to Rs.2.436.41 million in 2011, through a dedicated and
experienced sales team. (Nurpur, 2011) The company has won the prestigious brand recognition
award "Brand of the year 2006-2007" in the categories of Flavored Milk, Butter, Cheese and in
2008-2009 won the award in the category of "Butter "and again won the" Brand of the year in 2010
"in the Butter, cheese and flavored milk category.

Pakistan is on number four in producing milk in the world. On the consumption side, 26%
of Pakistan's food budget is spent on milk and its products. The task of reaching several urban and
rural markets is a challenge for milk producers. Future demand for dairy products is expected to
increase rapidly due to faster population growth, increased urbanization and / or an increase in the
absolute urban population, animal products are necessary to meet protein requirements. and
calcium of the population in the health field, the income elasticity of the demand for milk and meat
is also greater than one, which implies a more than proportional increase in the demand for dairy
products and meats that the rate of increase in income, therefore, better livelihood opportunities in
livestock.

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3. BACKGROUND
We are a tradition that began in the small town of Nurpur over 50 years ago. Noon Pakistan Limited
was established in Pakistan on September 26, 1966 as a limited public company and the company
is listed on the Karachi Stock Exchange and on the Lahore Stoke Stock Exchange. Nurpur is a
member of the Noon Group of Companies and is being supervised and managed by highly
qualified, experienced, technical and business senior managers and executives. Nurpur is in the
fourth number in 2014 according to the volume of sales in Pakistan. The Company has achieved a
682.73% growth in turnover over a period of four years. The turnover of the Company has
increased from Rs.311.27 million in 2004 to Rs.2.436.41 million in 2011, through a dedicated and
experienced sales team. (Nurpur, 2011) The company has won the prestigious brand recognition
award "Brand of the year 2006-2007" in the categories of Flavored Milk, Butter, Cheese and in
2008-2009 won the award in the category of "Butter "and again won the" Brand of the year in 2010
"in the Butter, cheese and flavored milk category.
As always, we always go out every morning to collect fresh farm milk so we can continue
to give Nurpur's promise of natural freshness and purity. Known for the best butter in Pakistan,
Nurpur has quickly become a favorite when it comes to other dairy products. Our varied range of
dairy products gives customers the option of deciding autonomously the lifestyle they want to live.
From Nurpur UHT Milk, low fat milk, flavored milk, butter and cheese. Nurpur has something for
everyone. Nurpur, which is the trade name of Fauji Foods Ltd (formerly known as Noon Pakistan
Ltd) began on September 26, 1966 as a PLC (Public Limited Company) and today has become one
of the leading dairy products in Pakistan. Member of the Fauji Group of Companies, it is the first
dairy company in Pakistan certified according to ISO 22000: 2005.

3.1 COMPANY OVERVIEW (THE FAUJI GROUP)

Founded in 1954 under the Charitable Endowments Act 1890 as a Charitable Trust, the group was
purposed to help provide welfare for ex-servicemen as well as their dependents. Starting off as a
humble venture, today, the Fauji Foundation runs more than 18 industries. 80 percent of the
generated income from its business ventures is used for welfare activities in the fields of health
care, employment, education, and activities at various training centers serving roughly 9 million
beneficiaries (5% of the country’s population) nationwide. Currently the foundation operates 115
Medical Facilities, 100 Schools & Colleges, 65 Vocational Training Centers and 9 Technical

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Training Centers across the country. Under the umbrella of the Fauji Group of Companies, with
major shareholding by FFBL – Fauji Foods Limited (FFL) was founded in 2015 after the
acquisition of Noon Pakistan Limited, a company with an over 50-year dairy legacy in Pakistan.
In February 2016, Fauji Foods introduced a new brand for the masses by the name of Dostea.
Dostea is a liquid tea whitener which renders the perfect taste and color you require from your
daily cup of tea. Founded in 1966, the Company’s brand Nurpur has been a household name across
generations. After the acquisition, Fauji Foods relaunched the House of Nurpur in May 2016, thus
reviving an age-old tradition of wholesome quality. The House of Nurpur, renowned for its Butter
in Pakistan is also gaining traction across its consumer base for other wholesome additions to its
product range. In 2017 FFL ventured into the Juices & Nectars segment with the introduction of
MUST fruit juices in a range of exciting flavors.
3.2 BOARD OF DIRECTORS

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3.3 OUR VISION

“Ku ka Dodh hazar nemat ha”

The entire business philosophy of Fauji Foods Limited revolves around a simple goal: ensuring
development, production and wide-reaching access for the people of Pakistan to safe, nutritious
and delicious dairy and food products. This philosophy is ingrained in our vision of “Transforming
lives through nourishment”. We at Fauji Foods ensure that our food brands not only bear the gift
of health, but also a greater one of joy.

3.4 OUR CORE VALUES

Happiness is at the heart of our business. Collectively as Fauji Foods, and individually as a unique
part of a community, we work to understand the needs of our stakeholders and develop a culture
that helps meet them, so that we can achieve our full goal of spreading happiness in a complete
circle. We embrace innovation. Success is not an achievement overnight and it certainly is not
without risks. Therefore, we continue trying to do the impossible with the constant search to make
an additional effort. We care about our community from the beginning. Whether our hard-working
agricultural partners, our precious clients, diligent employees or our valuable investors, our goal
is to build relationships based on empathy and trust. Our constant focus on research and
development helps us to be aware of everything that is changing, be it the technology or the needs
of our shareholders. We constantly work to make sure we are the best at what we do. We are one
of the biggest players in the market and we grow more every day. That is why we recognize the
impact we have on our community and make sure that our footprint is positive. Therefore, apart
from our philanthropic efforts, we make sure to connect with key stakeholders to ensure that we
always work towards the same major goal: to transform lives to improve.

3.5 AWARDS AND CERTIFICATIONS

Noon Pakistan Limited has earned many important awards and certifications that are: “First dairy
company in Pakistan certified according to ISO 22000: 2005, Brand Award of the year (2006-07)
in the Butter category, Brand Award year (2007 -08) in the Butter, cheese and flavored milk
category and the Brand of the year award (2008-09) in the Butter category.

• Pakistan Halal Std. Certification (PS-3733:2016)

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 • ISO 9001:2015 Quality Management System

• FSSC-22000 Food Safety Std. certification

4. PRODUCT LINE & BRAND OF NURPUR

4.1 Nurpur Original UHT Milk

From single serving ecolean pack to family pack, all of our SKU’s offer you Nurpur’s traditional
trademark goodness. Impeccably fit for the entire household, Nurpur’s daily dose of freshness and
purity helps you enjoy the unique taste of farm fresh dairy. Microwave-safe packaging ensures
hassle-free and safe daily use, retaining all the full cream richness. Nurpur Original UHT Milk is
available in multiple SKU’s. Nurpur Original UHT is available in packaging of 125ml and 250ml,
both of which are ecolean packs. Apart from this, 1000ml TBA (for food services customers),
1000ml TGA and 1500ml serving sizes are also available.

The company presently aims to put additional focus on the UHT milk segment where
margins are higher along with further strengthening its distribution network given the expansive
landscape of Pakistan. Here, FFL is in a more comfortable position given the success of its tea
whitener explained earlier. The one step plant which is a “5G grade” procured from TetraPak
Sweden is the top of the line technology available in the world today with greater fuel and water
efficiency compared to its predecessors. Installed capacity for liquid products is approximately
650,000 litres per day. UHT volumes have picked up reasonably over the past two years as its
distribution network deepens. The UHT segment provides a higher margin when compared to tea
whitener. FFL procures milk from rural collection centers and has the latest testing equipment
which allows it to test the barrels of milk on site before being transported on chilled vans to the
plant. Recently, FFL has also signed a partnership in Feb 2018 with the Australian Government
funded Market Development Facility (MDF). Through this partnership, 20 new milk collection
centers are to be opened in southern Punjab. Critical knowledge on best practices relating to
milking, vaccination, and husbandry will be shared at these centers with smallholder farmers.

4.2 Nurpur Original UHT Low-Fat Milk

From the fitness oriented to the healthy eaters and everyone in between, here is our promise of
light wholesome nutrition. With a perfect balance of essential vitamins, protein and carbohydrates,

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Nurpur Low Fat Milk is light on fat and #HighOnHealth. Nurpur Low Fat Milk is available in
SKUs of 1000ml and 200ml.

4.3 Nurpur Flavored Milk

Colorful packaging, the healthy wholesomeness of Nurpur Milk and a unique blend of flavors.
Nurpur Junior is not only a personal favorite for the kids but popular amongst consumers of all
other age groups as well. A fun twist on drinking milk. Nurpur Junior is available in packs of
125ml and 200ml. Nurpur Junior is available in three exciting flavors:

o Chocolate
o Strawberry
o Badaam & Zafran

4.4 Nurpur Lassi

A heat-buster, a summer chiller and a purely desi indulgence. Nurpur Lassi is available in Salted
flavor. Enjoy it on its own as a hot weather refreshment or with a meal; Nurpur Lassi is sure to
cool you down to the core. Nurpur Lassi is available in pack of 200ml. Flavored drinks by the
name of “Must” and “Lassi” constitute one segment which offers huge potential in Pakistan given
the severe under penetration in the industry. Though, competition is high and margins are tight but
increase in volumes would add value to the bottom line which again requires a stronger distribution
network already being in the focus of the management.

4.5 Nurpur Butter

Our fan favorites. For years, Nurpur Butter has been a staple in households across Pakistan.
Uniquely crafted, Nurpur Butter is velvety in texture with a subtly salty aftertaste. A perfect
combination with bread and a tasty alternative to oil to cook in, our butter spreads happiness
through its versatility. Nurpur Butter is available in SKUs of 10g, 50g, 100g and 200g. Butter
produced by the name of NURPUR BUTTER is a leading trusted household name for generations
in Pakistan. Butter is a very high margin product in the dairy line. However, focus on UHT milk
and Dostea in the past couple of years was necessary as the company built its distribution network
due to the high installed capacity and cost of the plant. Since now both products are known, the
company can and in fact has already started to focus on butter as well. Competition in butter has

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been primarily limited to just one foreign brand by the name of Lurpak from Denmark. Price
difference between the two has now been reduced to 25-30% which was previously as high as
100% without affecting sales. The company can easily meet the total demand of the formal butter
segment in Pakistan and needs only to expand its distribution network to capture further market
share. Extra fat extracted during the treatment of raw milk at the plant supplements the butter
manufacturing process at a lower cost resulting in higher margins particularly given limited
competition. We expect this strategy to increase average margins from this year onwards on the
overall product mix.

4.6 Nurpur Cheese

Add it to a sandwich or burger or use it to add that extra bit of zing to your daily meals our cheese
will never disappoint. Creamy and natural, Nurpur Cheese comes in two flavors: Mozzarella and
Cheddar. Each being uniquely delicious, no matter which one you try, Nurpur cheese will always
leave you craving for more. Nurpur Cheese is packed in state of art packaging which ensures its
freshness and original taste. Savor the wholesome goodness of our cheese for an enriched
experience. Both Nurpur Cheddar and Mozzarella Cheese are available in multiple SKUs.

Cheese is presently a negligible contributing product in its top line, but the management
seems quite keen on strengthening its market penetration possibly through a re-launch strategy in
the very near future. Moreover, with the onset of the fast food culture over the past couple of
decades and success of foreign and local fast food chains, cheese as a product has seen an
increasing demand though no established data is available to validate market size. We expect the
average margins of the portfolio to increase once Cheese is launched aggressively.

4.7 Pasteurized Milk

Give a taste of fresh cow’s milk, full of nutrients and proteins, to your family. Doodh is 100%
Hormone-free Australian cow’s milk collected from the farm, pasteurized and delivered in state-
of-the-art poly packaging. Doodh is available in SKU of 1000 ml.

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4.8 NURPUR BRANDS

4.8.1 Dostea- Liquid Tea

Whitener Liquid Tea Whitener by the name of “Dostea” has been a huge success in this growing
market with Pakistanis love for tea in their daily life. Dostea has gained 25% of the market share
in a short span. Every day, people from all walks of life in Pakistan start their day with a cup of
tea. Legend says that it’s the elements in a cup of tea that make or break your day. Dostea, a creamy
tea that fills with joyful experience, laughter and friendship. The great partner to your lovely cup
of tea, delivering the perfect balance of rich taste, aroma and feel. Dostea will leave you yearning
for #AikCupAur.

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4.9 Must Fruit Drinks

From the strong flavor of tamarind to the fruitfulness of

lychee, MUST fruit drinks are a range of fruit drinks
unlike any other. Tailored to appeal to the exotic tastes
of the local palate, this range of fruit drinks comes in all
your favorite flavours making it popular with everyone
throughout the year. MUST Fruit Drinks, Try karna
MUST hai!

4.10 Taaza Chai Mix

Elevate an ordinary cup of tea into a refreshing experience with Taaza Chai
Mix, a UHT liquid tea whitener that leaves tea lovers rejoicing the perfect cup
of tea. Available in 125ml and 250ml.

5. PESTEL ANALAYSIS
5.1 Political Analysis:

The political circumstances are not very steady in the country, but this does not directly influence
the trends and patterns of customer spending. There are no restrictions or barriers in the growth of
this industry. Therefore, the political conditions do not affect this market because it is a consumer-
based product and the customer must buy it in any condition.

5.2 Economic Analysis:

The economic conditions are not very favorable and the economy is facing problems, but it is
directly influencing the purchasing power of consumers, but in our product, it is not so much what
it should be. If the country is out of its present complications, it will further lift up the growth of

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this industry, as people will feel more secure economically and will further increase market
attractiveness.

5.3 Social Analysis:

Social patterns are changing in the country, as the world is becoming a global village, and they
share and accept each other's patterns. People are increasingly attractive towards branded products.
It is becoming fashionable, and both young generations and children are more attracted to this
industry. People are moving towards branded food / dairy products due to hygienic reasons.

5.4 Technology Analysis:

High technology is the basic requirement of the dairy and food industry. Companies that use the
latest technology have some cost benefits over companies, which do not use high technology. The
key to the survival of companies in this industry is the use of high technology for quality, hygiene
and cost purposes.

5.5 Legal/Law:

If government imposes heavy taxes on the industry then it badly effects the industry growth. The
taxes imposed by the government and it differs from industry to industry. FMCG’s have to pay
heavy taxation, changes in any taxation system can badly effect Nurpur’s productivity & sales
(profits).

5.6 Environmental:

About the environmental concerns of Nurpur products are the symbol of good health & nutrition
no matter which product is under consideration. Nurpur also consider a lot about the environmental
factors because they are very much socially responsible towards nature & humans.

6. SWOT ANALYSIS
6.1 Strengths

• Market leadership in selected product categories

• Strong and experienced sales team
• Strong supplier relationship

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 • Brand loyal customers
• Strict compliance with quality standards.
• First dairy company in Pakistan certified according to ISO 22000: 2005

6.2 Weaknesses

• Weak coordination between departments.

• No emphasis on creating brand value
• There is no formal human resources department
• Centralized Decision Making
• There is no fresh blood recruitment policy.
• Selective distribution

6.3 Opportunities

• Exporting products to foreign countries.

• Increase in demand for dairy products due to urbanization and population growth.
• Ensuring availability in untapped markets.
• Launch of innovative products for health-conscious consumers.
• Moving towards integration

6.4 Threats

• Trust in few suppliers.

• Increase in sugar prices.
• The increase in oil prices increases transport costs.
• Energy and energy crisis
• Acquisition of Quality Milk as milk production fluctuates.
• Increase in inflation by decreasing the purchasing power of consumers.

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7. TARGET MARKET

In order to create brand awareness in the minds of consumers, companies can make use of
advertising by marketing their product over and over again, which will create some competitive
advantages for them.

7.1 Demographical Segmentation:

o Middle Class Families

7.2 Psycho Graphical Segmentation:

o People oriented to objectives and focused on their careers.

o Those who are health conscious

8. MARKET ANALYSIS
8.1 Growth strategy:

Market and product development are a step by step process. Growth cannot result if any of the
steps are missing. Nurpur entered the market with the introduction of butter and milk tetra pack.
Nurpur is very quality conscious. Every time Nurpur's name is mentioned, the first thing that gets
stuck in people's minds is butter and milk. Gradually, over time, people's income increased and so
did knowledge. They realized that tetra pak milk is much better than gawala milk, so more people
started buying Nurpur milk, even if it cost people more than gawala milk. This is how Nurpur
developed its market.

8.2 Milk suppliers:

As Nurpur is a dairy company, its basic raw material is milk supplied by farmers. Bhalwal, located
in the Sargodha district, is the central region for the collection of milk supplies. There is an
agricultural land called Bhalwal that is enriched with water and pastures. Dairy animals are found
in abundance here. Only 60,000 to 70,000 liters of milk are collected in this region. For suppliers,
chillers have been built to keep milk fresh. Nurpur performs maintenance, but the benefit goes to
the owners of the chillers. Provides Rs 2 / - extra to milk suppliers.

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8.3 Sector Analysis

Nestlé is the largest company in the dairy industry with a production capacity of 1.3 million liters
with an average monthly capacity of 1.04 million liters. Haleeb Food limited is the second largest
company in the dairy industry with a production capacity of 0.9 million liters with an average
monthly capacity of 0.72 million liters. Nurpur Milk is the 5th milk producing firm of Pakistan
with a capacity of 0.15 M liters with an average monthly production of 0.12 M liters according to
2005. Now Nestlé remains at the top of this industry with an average capacity monthly of 99.5
million liters (2009: 80.58 million liters) and an average monthly production of 62.5 million liters
in 2010 (2009: 53.33 million liters). In 2010, Nurpur has an average monthly capacity of 0.487
million liters (2009: 0.487 million liters) and an average monthly production of 0.222 million liters
in 2010 (2009: 0.147 million liters).

8.4 Competitors:

There are competitors of Nurpur in different brands. Some are as follows:

8.4.1 Nestle

Nestlé is the world's leading nutrition, health and wellness company, and was founded in 1866 by
Henri Nestlé. It has employed around 250,000 people and has plants or operations in almost every

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country in the world. Nestlé is the world's top nutrition, health and wellness firm today. Being the
world's top water bottled firm is based on economic model: solid brands, global presence,
innovation capacity, environmental management and passionate people.

8.4.2 Dairy pure

Shakarganj entered into the dairy business in 2006 with the brand name “good milk”. Since then
it has been able to diversify its portfolio of products in both dairy and beverages. The company
also been able to leverage its parent company’s presence in the farming community to establish its
self-collection network thereby being able to develop a strong supply chain for the business
function

8.4.3 Haleeb

Established in 1984, Haleeb Foods is one of the inventors of the dairy sector in Pakistan. With a
strong emphasis on nutrition, health and the well-being of its consumers, Haleeb Foods uses first-
class dairy processing methods. Our portfolio includes many of Pakistan's favorite brands, includes
a wide range of delicious and quality products ranging from milk to juices and pure ghee.

8.4.4 Olper’s

Engro Foods Limited is a 39.9% owned subsidiary dedicated to the manufacture, processing and
marketing of dairy products, frozen desserts and fruit drinks. The company owns two milk
processing plants in Sukkur and Sahiwal and operates a dairy farm in Nara, Sindh. In its constant
efforts to "raise consumer pleasure worldwide," the business has recognized several brands that
have already become familiar names in Pakistan, such as Olper's (UHT milk, low-fat milk, desi
ghee cream, lassi and flavored drinks), Omoré (frozen desserts), Tarang (tea bleach) and Dairy
Omung (UHT milk liquid and dessert cream).

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8.4.5 Product Portfolio Comparison

9. NURPUR CHALLENGES

Since from 2011 onward Nurpur is facing loss even that company can’t pay dividend and can’t
achieve Contribution Margin. As it was the 4th number in 2014 according to Sales volume in
Pakistan. Nurpur a player of Pakistan’s Dairy Market playing from 1960, and trying to compete
other companies and to survive in the dairy market. Earlier spam from 2011 Nurpur was in profit
and having a positive growth rate of 682.72% in 2004 till 2011. Reason is that variable cost and
operating cost is too high. There are many reasons which discus here.

• First reason in ineffective sales mix of different product category provides by the company.
Company’s major products are as in table no. #1

Product Cost

Butter & Cheese 15-20%

UHT Milk 10%

Flavored Milk 10%

Pasteurized Milk 10%

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Here we can see cost of Cheese and Butter is more than other products, reason is that these two
products need -4°C and a huge cooling space to store other than UHT and Pasteurized both just
need which just need 0-degree temperature. In 2014 company set a breakeven point on minimum
sale of 233 Million. Now company sale is good but due to high variable cost company can’t achieve
its Contribution margin ratio.

• One major hurdle is created by PFA (Punjab Food Authority) and PCSIR (Pakistan Council of
Scientific and Industrial Research) Laboratory. Basically, milk contains two major fats.

Milk

SNF
FAT
(sold non-fat)

After skimming “SNF” (Solid Non-Fat) is used in “Tea whitener” with Vegi Fat. And “FAT” is
used in Dairy Liquid by the combination of Whey Fat. In 2011 PCSIR claimed that Nurpur using
Vegi fat rather than the SNF, it is harmful for the health so pick your products “Dairy Rozana” and
“Chay Mix” from the metro areas. Because of the PCSIR statement Nurpur faced different type of
costs like pick up cost of unsold stock and all profit is converted into cost because of no sale of
defaulted products.

• Market forces have strong Impact on Profitability of any company. While on other hand it also
influences on Share Price of company. Parallel to Market forces another factor which effect
both on Profitability and Share Price is Efficient Managerial Decision Making and Investment
Decision Making.

9.1 Factors that effects the Milk Industry:

9.1.1 Natural factors

The natural environment is vital for Nurpur. Milk comes from dairy animals; They scratch
in the fields and meadows. If there is less rain, there will clearly be a shortage of pastures and

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meadows, which in turn will cause less milk production in cows. The collection is the most critical
part in the collection of milk, therefore, the natural environment greatly affects all dairy companies.

9.1.2 Product quality:

Nurpur products are excellent in quality. Nurpur does not compromise quality. They are
maintaining their standards in milk. They know that if the products are fake, consumers can
challenge them in court through PDA.

10. MARKETING MIX

10.1 Product (style and design):

Product design is usually made by Blitz agency and Tetra Pak packaging. They style and design
all the products.

10.1.1 Labeling

Labeling on packs is done by BLTZ agency and tetra pack. Nurpur is beholden by Health
Department and FDA to print certain things on its packs like fat and calories information, expiry
date and statement standardize UHT milk. The milk does not die for a year but it’s a rule to print
6-month expiry date.

10.1.2 Milk product development:

Product expansion is done by Nurpur itself, BLITZ agency and sometimes Tetra Pak also provides
some help with suggestions etc.

10.1.3 Core Benefit of Product

From the fitness oriented to the healthy eaters and everyone in between, here is our promise of
light wholesome nutrition. With a perfect balance of essential vitamins, protein and carbohydrates,
Nurpur Low Fat Milk is light on fat and #HighOnHealth. Nurpur Low Fat Milk is available in
SKUs of 1000ml and 200ml. They can also offer Fat free Milk and Long-Life Milk for those who
are not willing to buy the Milk from the local Dairy Milk suppliers.

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10.1.4 Product Design and New Product Development

They can design and develop new products based on various target groups. There are different
segment the market into several groups and design the products based on the needs of those groups.
As they launched different flavored milk product which are targeted at kids. They can also get into
the baby food market which also provide the company the opportunities to expand into new
categories. They can place the brand in the market as finest quality food and beverages that are
fresh, nutritious, healthy and irresistible. They also place themselves as innovative which creates
new treats and delicacies for consumers. They try to imbibe this image in the minds of the
consumers through their advertisements.

10.1.5 Future products

The company appears quite determined to possibly launch new products in the medium term
though we’ll have to wait for any specific details in the coming quarters as the management
remains tight lipped on which products it is considering. However, based on a competitive analysis
of the products of other major players (mainly NESTLE, EFOODS and Shakarganj) in our market,
only four key products are missing, in our opinion, which FFL does not have and others currently
produce. These include: Yoghurt, Dry Milk Powder, Cream and Ice Cream. However, the
management was clear that Ice Cream is the least contender given issues in the cold chain within
Pakistan which would take time to resolve. We would have to wait and see what product of the
remaining three the company launches in the future.

10.2 Price

10.2.1 Determination of price:

Prices are decided in comparison to competitors or by the recommendations of Tetra Pak, BLITZ
DDB or Dairy Association. Nurpur UHT milk has almost the same prices according to the prices
of competing products. The company has a price control department, so the employee of that
department conducts daily market surveys and verifies the prices of competing products and
informs its managers. Company of these prices the manager makes the decision to establish the
prices of the products. Now Nurpur UHT milk prices are:

250ml Pack Rs: 15

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 500ml Pack Rs: 30
1000ml Pack Rs: 54

NurPur flavored milk has a monopoly because no other company is providing flavored
milk like Nurpur. Then, the company has the power to control its prices because there is no strong
competitor against this product. The price of flavored milk is:

250ml Pack Rs: 22

10.2.2 Pricing approach:
Nurpur uses cost-based approach.

10.2.3 Survey research:

Nurpur does not have direct contact with its consumers. So, it usually surveys the retailers and
shopkeepers to know about people’s preferences, attitude and behavior in buying. They ask
questions like

“what category purchases Nurpur products?”

“Why they choose Nurpur milk over other milk?”
“Are these people loyal to Nurpur products?”
10.2.4 Factors Affecting the prices of milk:
- Social class
Nurpur's focus is on the upper classes, that is, only on A and A +, but as trends change
and people's purchasing power increases, more and more people are now in a position
to pay many of the things that were previously considered only for luxury. Nurpur
lovers are now also thinking about focusing on classes B and C.
- The groups
Nurpur generates demand for its products by the push factor. Therefore, groups play an
important role in creating demand for their products. People see influencers using a
particular Nurpur product and they also start buying it.
- Family
The main focus of nurpur is on families. Nurpur milk focuses on the drink. It's about
children.

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 - Occupation
The occupations of people who buy Nurpur products affect Nurpur in a way that most
white-collar and upperclass people buy Nurpur products. If more people get high
occupations, there could be an increase in demand for Nurpur products.
10.3 Place/Distribution:

Company is using 2 channels for distribution of Nurpur.

- Retail outlets (indirect channel)

- Sales promotion officers (direct channel)
10.3.1 Retail Outlets (indirect channel)
There are many outlets all over the country, which provide every day consumable items to the
consumers. 80 % of the milk’s sales would be through indirect channels.
10.3.2 Distribution and Warehousing:

There are many authorized distributors of Nurpur before but all didn’t keen to sale Nurpur those
other brands in the market due to fewer incentives. All other brands like Olpers, milk pack etc.
provides much higher margins to distributors along with many non-monitory benefits. Company
will purchase their own network of vans, which deliver the milk to all the retail outlets early
morning. The advantage of these vans came in the form of quick delivery along with advertising
in the form of printed van.

10.3.3 Marketing intermediaries /Physical distribution

The total number of Nurpur distributors is 130. But the main distributors in Lahore are 6, 2 in
Karachi and 1 in Rawalpindi.

10.3.4 Distributors in Lahore

- Lahore National Marketing

- A.S Marketing Lahore

- Creative marketing

- Blue Moon Marketing

- Hakeem and company

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 - Companies paracha

10.3.5 Distributors in Karachi

- Minhaj groups

- Shah enterprises

10.3.6 Distributor in Rawalpindi

- Pak Foods Ltd

10.3.7 Market distribution orientation:

After segmenting the main cities of the country, Nurpur goes further and then focuses on the
commercialization of these various segments. Nurpur's main target market is the A + and A class.
Due to changing trends and circumstances, people's purchasing power is growing rapidly. The C-
band class has also started using dairy products from other brands that were once thought to be
used only by elite classes. Now it has become a necessity for Nurpur to also focus on class B and
C if he wants to capture the market and increase his profits.

10.3.8 Undifferentiated Marketing:

Nurpur is practicing undifferentiated marketing because being a nationwide company cannot meet
the needs of people. However, it is considered the best in the segments it is serving.

10.3.9 Micromarketing

- local marketing

Nurpur performs local marketing providing services in some cities and areas of the country.

- Target marketing strategy

Nurpur does not have a type of targeted marketing strategy. Most of the work is done through a
brainstorm. And the idea comes to the mind of a manager, he discusses it with the president and
approves or disapproves. According to the brand manager, Mr. Umran, end users are never the
only customers. Distributors, retailers, resellers, etc. They are all customers. Therefore, Nurpur
has a vast network of clients throughout Pakistan. In addition, these clients also include another

28
group called "the contractors". They buy Nurpur products in bulk like PIA, five-star hotels or
hospitals, etc.

10.3.10Retailers:

In the same way, it sells its products in smaller quantities to its retailers so that they are motivated
and help promote Nurpur products. Also, if a retailer purchases 40 packages of Nurpur UHT milk,
it provides some additional packages for free to the retailer.

10.4 Promotion:

Nurpur does not have a separate marketing department that helps the company promote its
products. However, marketing is done in collaboration with the sales department. When Nurpur
launched his milk, he had many commercials and many employees were hired to make the
announcement in the big stores. Distributors provide free packages of 1-liter milk packages to
retailers with the purchase of 40 milk packages. In the same way, Nurpur has booked places in
stores such as HKB, Al-Fatah and Jalal. In addition, it provides some incentives to its retailers and
customers in

Like Ramadan, it sells its products to retailers and customers at lower prices so that they
can obtain some benefit. But retailers keep the packages for sale later after Ramadan at normal
rates. Nurpur did several activities in Royal Palm. The activities in these porch clubs help in the
promotion of the products. The whole class A + and A is there for them to see and observe the
marks present there and then adopt them. To promote its products, Nurpur is planning more
exhibitions in the future. Nurpur believes in word of mouth for the marketing of its products. Being
a nationwide company, you cannot afford to spend lacks and rupees lacks only on advertisements.
However, some billboards are seen in certain locations.

10.4.1 Advertising and Campaign / Event:

Nurpur's ads were shown on television for a month. This created a big difference in market capture.
Many consumers were attracted to ads. However, showing ads on TVs is very expensive for
Nurpur. Advertising for a month only costs Nurpur 65 lac rupees. Due to the limited budget,
Nurpur cannot afford such a large amount in ads. Nurpur has still managed to show posters in
several places.

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 - Nurpur Khushion Ka Khazana

We are pleased to announce our next round of lucky winners for Nurpur Khushion ka Khazana
campaign, so all those who cannot win this time do not be disheartened just grab your Nurpur pack
today and get a chance to be a winner in our next lucky draw. (April 15, 2019)

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 - Doodh Activation

Fauji Foods product “Doodh” activation started in the month of April, to be run all the way up to
beginning of Ramadan Kareem. This is being run in Lahore and Rawalpindi at various commercial
markets that serve residential areas like Askari X, Askari XI in Lahore as well as Commercial
Market Scheme 3, Bahria Town etc.

11. IMC OBJECTIVE

Advertising plays a major role in the life of any brand. When we going towards re-launching of
Nurpur the first step that we take is to spend a heavy amount of money on advertising the purpose
of this activity is to change the image of our brand in the mind of customers. Our IMC campaign
objectives are.

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12. IMC STRATEGIES

Integrated Marketing Communication strategy revolves around the following areas.

• Advertising
• Sales promotion
• Personal selling
• Direct marketing
• Public relation
12.1 Advertising

Ads are cost efficient way to circulate message, build brand preference or to educate people. Most
firms use an different agency to help create advertising campaigns and select and purchase media.
Nurpur Food Limited has contract with the agencies to develop advertising campaign. Nurpur
Food Limited has three advertising agencies which guides the company what should be the next
move and also give feedback regarding the market and competitors.

During summers, as the milk production declines along with the fact that thickness of the milk also
reduces because of low supply of raw milk from dairy farms; the supply decreases, which increases
the demand for, packaged milk, with the same quality that was given to the customer before so, it
is recommended that the management should emphasize on Pull strategy as Nurpur now may be
used as an alternative product. Advertisements, billboards, print media, electric media campaign,
etc.
12.2 Sales promotion

During winters, push strategy is suggested by giving inducements to the consumers because the
milk supply is good and the competition is intense.
12.3 Personal selling

Emotional tactics is used by the sales force will exploit the emotions of parents and persuade them
to select Nurpur as drinking milk for their kids.

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12.4 Direct marketing

In direct marketing the company should have to launch a funfair activity in different cities of
Pakistan in which families are asked to come. In these activity families particularly, children are
more focused. In this activity Nurpur management tell the children about advantages of milk
particularly Nurpur milk than engage them in different games like cricket, tug of war, eating
competition and much more like this will held. The families can come they’re without purchasing
any ticket. The entrance will be free for them. The campaign starts with the name of “Ao dekhen
zara kis ma kitna ha dum”. It is also strongly recommended that Nurpur foods must an effective
web presence in this interactive world. To promote the entire online marketing program must be
launched on the site. A comprehensive, highly targeted group of destination web sites must be
chosen for the program. The web site should be registered with yahoo search portal.

12.5 Public Relations

A public relations campaign must be undertaken. This robust program includes:

o Media tours

o Monthly press releases

o Media briefs

o By-lined articles and supplements

o Speaker placements

o A comprehensive dairy curriculum must be created and sent to major universities with food
science programs to make it easy for professors to acquaint their students with the
importance of packaged dairy products with special reference to Nurpur.

o Celebrity presence- a top model will be shown on TV and billboards advertisements

drinking Nurpur to show a healthy living.

- Internal Communications:

Over the years, organizations have begun to understand the importance of internal communication
to achieve corporate goals and objectives. Our IMC team has identified some of the irregularities

33
of internal communication. Information on the entry of raw milk for processing takes too long due
to excessive interference by management. The supply of packaged milk is irregular in some areas
because the information on demand and market supply is not effective. Due to the aforementioned
reason, part of the processed milk is wasted thus improving costs, which in turn creates a
detrimental effect on the company's overall profitability ratio. Training should be introduced to
reduce the dangerous effects of an irregular or inefficient internal communication system. Report
relationships must be clearly identified "Who informs whom"? We firmly believe that by
implementing the strategies mentioned above, management will have a great capacity to improve
corporate profitability, and will create a resounding brand of Nurpur.

13. POSITIONING STRATEGY:

• Nurpur has a current positioning strategy that Nurpur milk is mostly meant for drinking
purposes. IMC that the management has to somehow modify the product positioning.
• Before proceeding, IMC team believes that the management should also carry this positing
strategy of using Nurpur as a drinking milk as supported by the product slogan. “Ku ka
Dodh hazar nemat ha”.
• It is suggested that the product must also be presented as a dairy commodity that may be
use for tea users as there is a large tea user market.
• The product must be connected with the consumers as milk that is highly appropriate for
the purpose of making desserts, milk shakes, sweet dishes and other dairy made products.
• The promotion must be designed in such a fashion that consumers start buying Nurpur for
other than drinking purposes.

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14. CONCLUSION & RECOMMENDATIONS

The company has no need of running finance ability for the working capital requirement but it
need for the buy and installation of new plants, and from the company’s detail it is obviously
shown that the company management have capability to increase its production and market share,
and also there is potential in the industry to groom. Nurpur must minimizes the variable cost and
operating cost which is too high. From the detailed analysis we come to point that the company
needs finance for new machinery facility. The management of the company should take initiative
to looks forward to the future with confidence and envisages still better performance in the coming
year. They should have to set clearly defined goals for each Department and removed the
bottlenecks in their production facilities and adding some new equipment to facilitate availability
of all the products in line with the growing demands for our products. If the management work
effectively and efficiently it would be the key success factor for the company. Quality Food is
another factor that is giving Nurpur an edge against its competitors.

Further, Nurpur should diversify its product portfolio and should increase the distribution
Network. And they can introduce ice cream and some other products which can cut the competition
of the major players in Pakistan. They can also get into the baby food market which also provide
the company the opportunities to expand into new categories. They can position the brand in the
market as premium quality food and beverages that are fresh, nutritious, healthy and irresistible.
They also place themselves as advanced which creates new treats and delicacies for consumers.

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15. References
Retrieved from Faujifoods: https://www.faujifoods.com
1st-Qtr-financial-statements-March-31-2019. Retrieved from Faujifoods:
https://www.faujifoods.com/wp-content/uploads/2019/05/1st-Qtr-financial-
statements-March-31-2019.pdf
Board-of-directors-copy-2. Retrieved from Faujifoods:
https://www.faujifoods.com/board-of-directors-copy-2/
Core-Values. Retrieved from Faujifoods: https://www.faujifoods.com/core-values/
Core-values-copy/. Retrieved from Faujifoods: https://www.faujifoods.com/core-values-
copy/
Fauji-food-services-2. (2018). Retrieved from Faujifoods:
https://www.faujifoods.com/fauji-food-services-2/
Media-Gallery. Retrieved from Faujifoods: https://www.faujifoods.com/media-gallery/
Nurpur-Low-Fat. Retrieved from Faujifoods: https://www.faujifoods.com/nurpur-low-
fat/
NurPur-Milk. Retrieved from Scribd:
https://www.scribd.com/document/59620785/NurPur-Milk
Original-Nurpur. Retrieved from Faujifoods: https://www.faujifoods.com/original-
nurpur/
Vision. Retrieved from Faujifoods: https://www.faujifoods.com/our-vision/

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