Vision statement:

“TO MAKE THE COMPETITION IRRELAVENT”

Mission statement:

“To provide the best quality product to the potential customers comparatively at low
price and high quality by using effective distribution channels “
 ENVIRONMENTAL ANALYSIS:

Competitive Forces:

POLITICAL

 The political stability of Pakistan is highly uncertain therefore every investor

has to think intensively before investing his capital. But from last few years,
Pakistan’s industry is showing considerable growth and opportunities for new
investments, due to consistent policies of the Musharaf government.
 In this industry there is not proper Trade association based on which are
platform regulatory requirements could be set.
 Challenge faced in this sector lie in the face of smuggled goods that penetrate
into the market and present branded products with stiff competition and the
price conscious consumer in Pakistan on average ends up buying the foreign
smuggled product, which is cheaper and more affordable only realizing through
experience if the product used is suitable.
 Government taxes formulate at least 50% of the product price other than the
cost of production.
 Generally 40% taxes are applicable on FMCG.
 Import duty of 15% is charged on importing shampoo’s raw material and it adds
the 25% value to custom duty. Besides this there is not check and balance on
import that means an ordinary person/company can also import on same rate
of duty on which a giant company is importing.
 Manufacturers in Pakistan are offered with so called incentives to compete
with other imported goods in terms of their quality and value to customers.
 Govt. of Pakistan doesn’t offer subsidies to its industry like in China; electricity
is subsidized for its industrial units.
ECONOMIC ENVIRONMENT:

 GDP is targeted to grow by 8% in 2005-06, with a growth in manufacturing

(10.2%) and continuing robust performance in services (15%) and agriculture
(5%-6%).
 Exit from the IMF Program marks an important milestone.
 The overall fiscal deficit that averaged has declined to 3.2% in 2005-06.
 The per capita income of Pakistan has reached up to $847; Pakistani market is
quite unsaturated for introduction of new drinks products regarding sports
drinks. With rise in per capita income and standards of living, consumption of
per capita income is expected to increase.
 Targeted trade deficit for the year 2006-07 is $ 9.4bn while it had been
crossed $ 2.3bn in just two months after budget speech.
 Rate of inflation is increasing on fast pace, which directly affects new
investments, because inflation is directly proportional to interest rates.
 The literacy rate of Pakistan is estimated at 54% which is good for us to launch
a sports drink because with the increase of knowledge sports person are more
conscious about their health.
 Cost of production and imported raw material are very high but in the case of
drink manufacturing most ingredients are less costly and locally available.
 Expo canters are being introduced in some major cities to robust Pakistan’s
export revenue so we can also export sports drink in future and the Expo
centers display will help us a lot.
 In 2006-07 trade policy, Freight subsidy scheme has been modified for
diversification of markets/products, which will reduce the further
manufacturing (plant) cost because we are to import one part of our
manufacturing plant.
SOCIAL ENVIRONMENT:

 As the standard of education is rising and the awareness is increasing regarding

the health.
 Now a day’s people are becoming more health conscious so they prefer and
demand for products which fulfill their body needs.

 As the people are becoming more health conscious and like indulging their-
selves in sports activities, they want to have products which maintain their
body requirements like sports drink, energy drinks and food supplements.
 As imported and internationally renowned brands are assumed to be prestige to
use, but they are expensive product, which are not under the reach of average
people so people want the same quality product at some low price.

 People like to socialize and as the activities have increased where different
sports games are enjoyed this new trend is boosting the overall drink industry
in Pakistan.

TECHNOLOGICAL ENVIRONEMENT: -

 Technological environment in Pakistan taking its robust because of new

investments in country.
 Comparing with Multinationals industry in Pakistan, local industries are trying
to use advanced technology in its operations.
 Spirit sports drink is manufactured using latest technology through which we
are cutting our manufacturing cost and making our products environment
friendly that is allowing us to act as green marketer.
 IT trend is allowing us to do our operations effectively and efficiently.

B. Target Market:
Identification
1. Demographic characteristics:
Sex: male & female, Trend toward playing game is increasing as
the awareness is increasing.
 Age: 15-30 years, Physical active males and females
Occupation: Occupation, Vary form person to person.
Ethnic Background: in Pakistan people are from different ethnical
backgrounds but there is no discrimination of races in playing
sports. People of different races play sports
Family Life Cycle:
2. Geographic characteristics:
Location:
Region = South East
Country = Pakistan
Province = Punjab and we are currently choosing only
urban areas
City = Lahore’s porch areas and also near playing areas
climate = mostly hot through out the year but 3-4 months
of winter from December to March.
Density = Population density is very high in the area of Punjab and
in Lahore, Lahore is one of the dense populated area of Punjab

3. psychographic
Attitude = the attitude of people is changing regarding there life
styles and they prefer to buy branded and Quality Products.
Activity = People love having get together parties and playing
games.
Opinion =
Interests = Every sport person want to keep him self active and
want to be ahead in games.
Motives =
Lifestyles =

4. product-usage characteristics
Usage rate =
Benefits sought = Remove exhaustiveness, quench thirst and fulfill the body
requirement after playing games or doing physical exercise.
Need Analysis = Branded sports drinks is available in the market are fulfilling
the need of potential customers. Currently available Sports drinks improve
performance level, quench thirst and refresh body but their distribution is done
through ineffective channels. Market survey shows that the imported sports
drinks are not available at convenience places. Research also showed that
people are ready to buy sports drinks comparatively at low price. There is no
proper promotion of sports drinks in Pakistan so people especially players are
unaware of these types of sports products.
Imported energy drinks also advertise itself as a product to remove
exhaustiveness gain energy and quench thirst, but energy drinks used caffeine
as ingredient which is not good for health. Health conscious sportspersons are
not recommended to use energy drinks regularly. Internationally sports person
 are advice not to use caffeine. As these days there are also concerns about
players that whether they are drug edited or not.
Due to lack of local distribution channels energy drinks are not available near
playing areas as well as in different shopping stores. We can say water is
satisfying a need to quench thirst, refresh body and it uses a very effective
distribution channel to make the product available near to sports areas. It is
not satisfying fallowing needs: like remove exhaustiveness, remove loss
minerals and vitamins. Supplements are used as weight gain and fulfill the
requirement of body, but it is little bit time consuming activity to make a drink
using health supplement. A person in a state of exhaustiveness is not
convinced to make drink. Supplements are available only on big stores.

Need of our target audience expected to change in the future:

Need of our target audience are not expected to change drastically. It’s human
psychology that drinks are always preferable to use at while playing or doing
physical exercise. The maximum expected change in near future is to
manufacture a sports drink using different ingredients or with different
formula which can fulfill the requirement of a sport person more effectively.

SWOT Analysis:
Strength:
• Unique product design
• Own logistics
• Quality product at low price
• Target market encircles the age group from 15 to 30 years
• Skilled workers
• Hi Technology
• First sports drink manufacturer in Pakistan
• Product price low with respect to the competitors
• Easy and convenience availability
• It is made of Halal ingredients

Weakness:
• Limited budget as compare to our foreign competitors
• Less Advertisement
• No brand awareness due to new brand
•
Threats:
• Entrance of the new competitors
• Globalization due to WTO
• Competitors’ strategies
• Fluctuation in the economy
• Government policies
• Changing fashion of the target market
• Single product company
• Threat from other sports drink exporting countries
• Wide availability of sub-standard substitutes.

Opportunities:
• Increase in the population
• Launch internationally
• To create brand awareness
• Decrease in production cost
• Currently no one is manufacturing sports drink locally
• High Export potential
• Reduction in excise and import duties on food processing machinery.
PORTER’S FIVE FORCES MODEL FOR INDUSTRY
STRUCTURE AND COMPETETION
BARGAINING POWER OF BUYERS:-

In cosmetics and toiletries industry particularly in shampoo, bargaining power of

buyers is high because of some following reasons.

 Buyers have not got many other options available in market

 There are few number of international brands are available in market
 Switching cost of buyer is quite high because of low range in international
brands.
 Most of the customers are not well aware of their distinctive value added
features.
 In Pakistan buyer’s power is also high because they feel prestige to buy imported
brands than locally manufactured.

BARGAINING POWER OF SUPPLIERS:-

Bargaining power of suppliers is low because,

 Most of their raw material is easily and locally available in Pakistan.

 Major suppliers of chemicals and other ingredients are located in SINGAPORE,
PAKSITAN, CNANADA, ENGLAND and GERMANY, so they have got a choice among
suppliers.
  Bottled packaging is imported from Singapore and one of its suppliers is located
in Karachi, named decent packaging and few more on different locations
internationally. So, they can chose among them.
 Printing is done from Packages , their bargaining power can be high because
packages is number one packaging/ printing company in Pakistan so they can
also have bargaining power on some issues.

Threat OF SUBSTITUES products:-

Sports Drink’s substitutes are ENERGY DRINKS and SUPPLIEMENTS.

Energy Drinks: - Energy drinks has low bargaining power as compare to Sports Drinks
because People are more conscious about their health and they believe that Sports
drink is far better than removing tardiness and quench thirst by Energy drinks.
 Energy drink cannot fulfill the demands up to the extent where Sports dirnks
are fulfilling.
 Some people prefer to take energy drinks while playing because in the long run
it harms the health of the player but it temporarly boosts energy.

SUPPLIEMENTS: -
 Locally manufactured supplements are of low price as compared to Sports
drinks so cost of switching may be high or low.
 It can be low at the same time because customer may not be able to
differentiate between suppliements and sports drink.

THREAT OF NEW ENTRANTS: -

In this industry, new entrant can be threat or potential at the same time because,
opportunity in terms that there is not any local company operating in industry and new
entrant can help to grow the market. And threat is that, market share will be divided
in many parts, our company and companies of international brands may lose their
some part of market share. So always existing companies try to put some entry
barriers or sometimes they think of alliance against the new entrant.
There is a threat of new entrants especially of new imported brands that is a threat
that they can plan to target this segment in Pakistan. Some companies which are in
beverage industry like multinational can also manufacture sports drinks in Pakistan
and some new local manufacturers can also come in this industry.
WTO is a big threat due to which we have to compete with other international brands.

Possible Entry barriers can be,

 Strong capital base is big threat because existing international companies are
operating with huge capital base.
 For national new entrants it’s difficult to face multinational giants .
 It’s difficult to overtake the customers’ brand preferences & loyalty because
they are internationally renowned.
 It’s difficult to maintain an extended distribution channels and networks.
 New entrants would have to spend huge amount on advertising to shift the
customers’ loyalty.
 Sometimes it’s difficult to produce economies of scale to bring the fixed cost at
zero.

INDUSTRY COMPATITORS, RIVALRY: -

 In beverage industry rivalry tends to be intense because of very close

competition with another international brand. While there are only few
companies’ products in industry but still they are very close to each other in
terms of catering the market share.
 Rivalry also becomes more complex because competitors are also offering
almost same product line.
 As product is highly differentiated and buyers switching cost is quite low
which makes the rivalry stronger.
  As industry is highly concentrated in 2 players so its competition is so
intense and both are chasing the same customers.
 Rivalry is high because demand for shampoo is increasing and players are
same to fulfill their demand, so every company is trying to grab more
market share.

FORCES FOR CHANGE (HOW PEST IS IMPACTING THE

FIVE FORCES)
 RIVALRY ENTRANT BUYERS SUPPLIER SUBSTITUTES
Smuggling S
Overall high tax Buyers SSmuggled Political
making the rate is a threat bargaining products are environment has
competition to new entrant power is high also impacting almost equal
intense because to produce because of the supplier’s impact on
it is penetrating economies of getting variety power because substitutes
in market. scale and make of smuggled customers are because they
its fixed cost imported directly getting are in same
Import license is zero. brands. imported industry but
good move shampoo. herbal
because only Not More taxes on shampoos can
legal companies considerable industry are Import license is get edge on
can import the incentives and directly treating the chemical
raw material. subsidies are affecting the supplier shampoos
not attracting cost and price because they because they
Approximately to the new so; buyers will would also be don’t have to
50% of taxes are entrants. be looking for willing to supply import their raw
reducing the substitutes. to small material and
probability of Again smuggled companies who they price low
price wars. goods are threat Problem with don’t have than chemical
for new entrant shipments and import licenses. shampoos.
No trade that they are transportation And affect of
association can wasting some strikes can be Due to imposing smuggling is also
impact its portion of legal harmful for more taxes and low on
rivalry because share which industry duties, substitute
there is not new entrants because it may company’s because most of
platform where can probably create the production may the smuggled
you can settle grab. shortage in go down shampoos come
the matters market and it because of low of chemical
rather can hurt the demand which category.
competing on firm’s brand is impacted by
them. image. high price.
As GDP is Growth in GDP As per capita Increasing GDP By growing GDP,
growing, it and income is can impact the substitute’s
shows the manufacturing increasing it supplier’s power power can go
growth of the may attract the may increase in either way. either way. It
market and new entrants to the bargaining can be high if
indicating more be a part of power of buyer. As our substitute grows
competition. new market. company’s base more rapidly
As GDP is is multi than other
Rising inflation Inflation rate is growing and national, it products.
rate can make reflecting more market imports most of
rivalry intense risk for new potential is the raw Here as per
because of high entrants. increasing which material from capita income is
cost and price attracts the different increasing,
buyers may shift Increase in new entrants countries, so its power of
to substitute or literacy rate and it creates supplier’s substitute is
low cost creates more the more bargaining lowering. In
product awareness and options for power depends case of herbal it
market growth buyer. Which on supplier’s can be high if
Subsidy on increases which ultimately country’s they buyers are
freight may can be reduce the political and more aware
make the rivalry attractive for switching cost economic with herbal
strong due to new entrant. of buyers. situation. technology.
lowering the
composition of.
By increasing
more awareness Increment in By increasing By increasing As more the
about beauty awareness is more the level of awareness
and health, giving room for consciousness consciousness, about beauty
people are more market growth for beauty, impact on and care that
demanding so new entrants buyers bargaining
much
about might analyze it bargaining power of
shampoo’s so as a good signs power is supplier can go bargaining
increase in for them. increasing. on either side, power of soap
demand is by increasing will go down
increasing Now days As usage the and if people
revelry everyone likes patterns are consumption become aware
to buy his/her variating, supplier’s about the
As weather is own shampoo buyers’ margin of harmful
becoming rather using one bargaining is profitability will affects of
warmer and brought for also increasing also increase so chemical then
consumption of whole family, so at the same his bargaining
bargaining
this industry there is an proportion. power might go power of
tends to be opportunity by low but if there herbal
increasing so changing their As customers are only few shampoos can
there comes the usage patterns. are more suppliers then be high.
more influenced with he will show
competition for As companies advertisement, high bargaining
growing are competing so as much power.
consumption. by doing more advertise will
advertisements, be done by
As people are it is difficult for someone as
more coming new much bargaining
influenced local entrant to power of buyer
compete with will increase for
with media
existing giants. others.
and
advertisement
so every rival
is trying to
increase the
competition.
At the time Entrants may More Supplier’s may At the moment
both the big have threat of technological have negative with existing
giants are competing on used product impact by technology,
operating at technology would be, i.e. changing power of
almost the because they more variants technological substitute will
same level of might not have would be level, because remain the
technology, so sufficient base available in company same but by
here rivalry is of capital to the market might have to changing its
on moderate operate with that much change their trend it may
level. that high bargaining suppliers go either side,
leveled power of according to it depends on
technology. customers will new substitute’s
increase. technology, growth along
with
advancement
in tech.
Factor / Trend Business Implication Company Response

• smuggled • Penetrating • Creating brand

products the other Awareness.
• Higher tax brands in • Increase the
the market. price of product
rates
or decrease the
• Impacting profit margin.
cost and
price
structures.
• Growing GDP • Opportunity • Will try to
and rate of to broaden expand by new
production. the market. variants.
• Rise in • Increase in • Reducing the
inflation cost profit margin.
• Subsidy on structures. Or the use of
freight. • Lowering technology in
down the manufacturing will allow
cost of the us to reduce
per unit. manufacturing cost.

• More • Opportunity • Will continuously

to target
awareness and offering new
the new
consciousness segments. values and
to people. change the
• features of
• product

• according to the

• changing trends.

• • We are making
sports drink and
•
its’ design
•
environment
•
• Positive friendly.
• People change in
sales. • We will enhance
concerns
• product line,
Environmental
 affects. • promote our
• More products and
• People are
demand is
going towards required make people
from brand loyal .
sports.
customer.
• Advancement • Its threat if • Company is on
company right pace with
in technology. doesn’t react changing tech.
STRATEGIC GROUP MAPPING

Most of the
Pert Plus,
Remove sunsilk’s
Pantene,
Bio Amla, variants,
tardiness Herbal
Herbal Herbal
Essences.
Essences, Essences
Lifebuoy

Energy Head & Sunsil

Shoulders Bio Amla
Gainer k
, white
Life
Buoy,
Pert Plus

Thirst Medicam,
Selsun
quencher
Blue

NON
place CHEMIC CHEM. + NON
AL / CHEM
HERBAL

Marketing P’s
 ONE MORE STRATEGIC GROUP MAP CAN BE,

Chemical & Herbal Medicam

herbal mix essenc
e

Bio-
amla,

Herbal

Sunsilk,p
entene,
Chemical Sunsil Sunsil Sunsil Sunsil H&S, Selsu
k,pente k,pente k,pente k,pente Pert +,
ne ne ne ne n blue
life boy

Damage Dry Shine Silky Anti Medicated

dandruff
Market size:

No of Competitors:
We divide our competitors into 3 categories. First Category
comprises all those companies which are dealing in energy drinks. The 2nd category
consists of those companies which deal with sports drinks and come under the direct
competition. 3rd category contains all other available drinks use to remove exhaustiveness
and thirst.

Relative Position in term of market segment:

Perceptual positioning:

Product definition (positioned according to price, quality)

Excellent quality Sports Drinks

Locozede
Spirit Sports Realmadrid
Snapple Gatorade

Min price Max price

Milo

Least quality
 Marketing objectives:

• Building brand image in the market and create awareness in the mind of people.
• Getting highest market shares
• Increase in profit margin of retailer
• Increase in profit margin of wholesaler
• Create good image in the mind of retailers and customers.
• Profit Maximization: Through mass customization we will be able to enhance our
profit.
• Sales Maximization
• To capture expected Market share.
• Continuous line extension to meet the changing preferences of customers and to
remain ahead of competition.
• We are also intended to expand our product line by introducing different flavors
and sizes during the year
• To make available spirit sports at right place through effective distribution
channels to our potential customers.

Financial objectives

Societal objectives:

Be socially responsible organization through working as a corporate citizen. We are using

latest technology in our operations because of which we are able to reduce the wastage of
raw material and wastages. The design of sports drink packaging is like that it exhibits
less energy during manufacturing. Spirit sports drink’s components are of recyclable
material. Through latest technology and Operations Management techniques we are less
polluting the environment and providing Spirit sports at less cost which is benefiting the
masses.