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New Brand Development & its Sales Management

For

Canned Oranges

Submitted By:

Umer Shahid

M. Kashif

H. Shakeel

MBA-IV (E)

Submitted To:

Sir Waqar Awan

Quaid-i-Azam School of Management Sciences

Quaid-i-Azam University, Islamabad

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CONTENTS

y Mitchellsy

Historyy Vision &Missiony Corporate Philosophyy Productsy Quality Policyy Clientsy OASISy Customer & Servicesy Product Imagey Promotiony Pricey D

istributiony Operationsy Financials

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INTRODUCTION

Mitchell's Fruit Limited is a public company incorporated in Pakistan and listed on Lahore,

Karachi, and Islamabad Stock Exchanges. Mitchell's Fruit Farms Limited is the oldest food

company in Pakistan Farms. It is principally engaged in the manufacture and sale of various

farm and confectionery products. Since starting its operations in 1933, the Company has gone

from strength to strength, and its wide variety of products has inundated breakfast tables with

farm-fresh consumables, straight from its orchards in Renala Khurd - products of a high

standard, enriching the lives of millions of people with all the goodness of nature for a healthy

lifestyle.

Today the Mitchells family continues to grow, reaching more and more households worldwide

with an ever-increasing array of farm-fresh products ranging from thirst-quenching Squashes &

Syrups; fruity Jams, Jellies and Marmalade; rich Tomato Ketchup & savory Sauces; tasty

Pickles; refreshingly nutritious Canned Fruits & Vegetables; and a wholesome assortment of

Candies & Chocolate from its wide range of confectionery products.

VISION

To be competitive in the growing market as the quality managed company.

MISSION

1. To be a Leader in the markets we serve by providing quality products and efficient services

to our consumers while learning from their feedback to set even higher standards for our

products.

2. To be a Company that continuously enhances its superior technological competence to

provide innovative solutions and superior products as per requirement of the market place.

3. To be a Company that attracts and retains outstanding people by creating a culture that

fosters openness and innovation, promotes individual growth, and rewards initiative and

performance.

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4. To be a Company which combines its people, technology, management systems, and

market opportunities to achieve profitable growth while providing fair returns to its investors.

5. To be a Company that endeavors to set the highest standards in corporate ethics in serving

society.

CORPORATE PHILOSOPHY

The success ofMitchells brands is the result of the corporate emphasis laid upon Quality

Control reinforced by Research & Development. The R & D section prepares new recipes

and formulations whereas the QC section ensures selection of the finest fruits and error free

processing and packaging, thus ensuring that all products live up to the consumers high

expectations.

Human Resource is also of the pivotal importance for the Management and employee skills

are constantly being updated through training courses and study tours both at home and

abroad.

QUALITY POLICY

We, at MITCHELLS Fruit Farms Limited, are committed to produce best quality products

meeting our customers requirements at competitive prices, strengthening our position as a

QualityManaged Company. To meet this obligation, the company will continue updating

employee skills by training and acquisition of new technology. Re-evaluation of its quality

control and quality assurance systems.

Product Lines and Brand Portfolio

The Company has well known brand name with loyal followings in grocery products. The

company markets its product under the one brand name Mitchells; this branding strategy

further disseminates the companys recognition among consumer and enables the company to

frequently introduce new products with little expenses on brand recognition. From the very

onset, Mitchells makes efforts to extend its products length & breadth by introducing new

varieties of food products used in breakfast, dinner and other servings. Recently, the company

launched three new variants of fruit juices and four new products in the confectionery category.

Cumulatively, the company offers 140 products in nine categories catering to the middle to upper

class. The product portfolio of the company ranges from fruit juices, squashes, tomato ketchup &

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sauces, pickles, canned fruits & vegetables, jams & jellies, candies, toffees, chocolates and

drinking water. Surprisingly, despite the fact that the company offers 32 confectionery products

out of a total 140 products, confectionery product lines constitute 42% of the total gross sales

revenue on the back of higher turn-over than groceries items.

Squashes and Syrups / Bottled Fruit Drinks

Mitchells has got state-of-the-art juices and squashes

manufacturing set-up in PET and is capable of developing any

flavour with any specifications.

Bottled Water

Beneath the ground at Mitchells, Renala Khurd,there

is a pure source of water containing a perfect natural

balance of essential minerals. Mitchells has acquired

the best filtration and bottling equipment to offer thishigh quality bottled water in consumer and bulk

packaging. Testing and approval from UK-based

laboratory is just one proof of high quality standards

that Mitchells maintain.

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Preserves

Mitchells preserves range has been the first choice of every

household for 75 years and there is no match to Mitchells

preserves range. Mitchells produces best quality preserves

based on vacuum cooking technology to preserve flavour and

taste.

Sauces range.

Sauces and Chutneys are also one of the specialties of

Mitchells. The highly automated lines contribute to a superb

final product

Pickles

No one knows traditional taste better thanMitchells. Our R&D

department is capable of developing any kind of recipe

comprising pickled fruits and vegetables

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Canned Fruits and Vegetables

Being the leading fruit and vegetables processors of the country,

Mitchells has got all the expertise and facilities to process and can,

utilizing a fully automatic line, the vegetables and fruits.

Chocolate Confectionery

Mitchells has a high-tech and modern bar line, manufactured by

Sollich, the world famous German brand for chocolate

machinery, which is capable of producing bars of any size and

weight. We deal in bars of all types including caramel, nougat,

coconut, cereals and nuts, both with and without chocolate

enrobing.

We have also acquired a state-of-the-art moulded chocolate plant

for production of milk chocolate with and without centre filling.

Sugar Confectionery

Mitchells has got high speed soft and hard candy making

machines with a versatility to handle any unit size. You tell us

the product and we will make it for you.

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Canned Food

For those conscious of time and

quality, our range of canned fruits &vegetables remains the favorites. Our

ready-to-use products bring

convenience along with taste to

every kitchen. Mitchell's offers a

pure and consistent quality

throughout the year whether it is the

"in season" or not.

HISTORY

Mitchells is the oldest food company in Pakistan. It was established in 1933 by Francis J.Mitchell under the name of Indian Mildura Fruit Farms Ltd. After the country gained

independence in 1947, the company's name was changed to "MITCHELLS Fruit Farms Ltd."

with the brand name of "MITCHELLS".

Since its inception, Mitchells has gone from strength to strength, not only expanding its productline but also maintaining quality through the years to become one of the largest food companies

in the country. From the procurement of best quality raw materials, fresh from our own farmsand orchards to the adoption of latest production techniques, Mitchells has been in sync with the

evolving times.

The result of our efforts is that today we are among the market leaders in all our productcategories. Not only that, but our products are also gaining a market abroad with exports to

several parts of the world including UK, USA, Canada, the Middle-East and South-West Asia

where alreadyMitchells is a name to reckon with

Mitchells is the only major food company in Pakistan today with fully integrated operations

having its own growing and processing facilities at one location. Modern high-volume industrial

equipment, professional management and a trained workforce all combine to ensure that

Mitchells continues its dominance as the innovator, market leader and trend setter. In this regard

a major step was taken in 1998, whenMitchells became the first food company in Pakistan to

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achieve ISO 9001 accreditation, thus becoming more competitive on the international stage also.

Countrywide sales are managed by fully computerized and inter-linked regional sales offices

ensuring a smooth distribution system with nationwide coverage. Highly qualified executives,

using modern management tools, handle marketing, commercial, financial and accounting

functions from the Head Office in Lahore.

The answer to the question that why we want to add a new product range is that we want to

provide our customers what they expect from us, we want to retain our current customers by

providing innovative products, not only the current customers but also the new ones. We want

to give them additional benefits through quality and fresh fruits. So that they can enjoy fruits

which are not available in the market.

Main Clients

Institutional Clients

Mitchells has successfully catered the demands of its prestigious clients such as the Pakistan

International Airlines (PIA), leading five star hotels and clubs, Utility Stores Corporation, Canteen Stores

Department, main stores and reputed restaurants in major cities.

Foreign Licensees

Mitchells was also given proprietary rights by L. Rose and Company Ltd. of England in 1946 to

become the sole manufacturer and distributor of their world famous Roses brand ofLime Juice

Cordial and LimeMarmalade in Pakistan and Afghanistan.

Potential Customers:

Mitchells will focus on the upper middle class + Upper class of the society, and some of the

middle class who use these products occasionally.

Strategies of Branding

Mitchells is using consumer and trade promotion but mainly focusing on trade promotions. In

Lahore, the retailers benefit is 12+1, it meansMitchells gives one free bottle to its retailer on

the purchase of 12 bottles but on the other side, in Karachi, the trade promotion policy is 24 + 3

i.e. on the purchase of 24 bottles Mitchells gives 3 bottles to its retailers. Their unique selling

proposition is quality. They never compromise on the quality. Even if they got any complain

then they immediately replace it.

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Mitchells believes that success of the organization lies in the satisfaction of its customers.

Therefore Mitchells has always given first priority to its customers feed back and this they do

by the following ways:

y Through questionnaire feed back formsy Through shop keepersy Through ISO procedures (CPA, Corrective and Preventive Actions)

The feedbacks and opinions of the customers are very useful for them and besides this; they

study the feedback and try to implement that accordingly.

Our new product:

As the current market of squashes is nearly saturated and Mitchells want to lead the market so

that we are going to offer different product than first we have.

OASIS

We are offering OASIS as our new product. OASIS means a fertile tract in a desert (where the

water table approaches the surface). We are offering canned oranges, why we are giving

oranges in cans?? Because Oranges are so appealing no wonder they are loved by

everyone!

Our new product will be easy to use for the customers because they used the canned products of

Mitchells before, so there will be no problem for them to use OASIS.

The uniqueness ofOASIS is the customers can enjoy oranges in summer as well; it will have the

same freshness as like the oranges. Orange, as part of the citrus family, is rich in vitaminC as

well as other micro-nutrients, certain photochemical and fiber and also protects against infection

and cancer. It is also rich in beta-carotene and bioflavonoid. A small orange contains generous

levels of folate, potassium, and thiamine, as well as some calcium and magnesium.

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Our new proposed product is working model. And it will be introduced in coming summer

because still we have to complete its promotion and production process and further it this

summer we do not have orange available to launch our product.

Current canned food item are shown in figure below.

Our new proposed OASIS will be in same type of packing. Because we can store the orange for

the required time period easily and we can keep it fresh as it is natural. The most uniqueness of

our product will be the first time offering in Pakistan.

Customers and Market:

We will focus on urban areas where there are potential customers and it is easy to supply

products over there. Our focus to urban areas is due to potential customers as we see status

conscious people are in cities and they want to be different from other people by using theunique products.

Mitchells have already loyal customers and they will give more attention to OASIS as it is the

new product from there favorite brand.

We are as the leading company in food items and have no difficulties to make available our

product all over the Pakistan.Mitchells distribution network can fulfill our new product

demands. Our new product is consumer based.

The customers of the Mitchell's are loyal with the company and make purchase of such products

that are labeled Mitchell's. There is strong distribution channel in the country that is the strength

of the company. The company also directly deals with the large customers like PIA, KFC,

PIZZAHUT, MCDONALDS, HOLIDAY INN, and many other prestigious institutions of the

country. Apart from these institutions,Mitchell's deals with the large retailers itself like PACE,

HKB stores, UTILITY STORES, CANTEEN DEPARTMENTAL STORES, SHEZAN

BAKERS and so on. So in this way we can say that company targeting its customers not only by

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the distributors but also go directly to retailers and other institutions for creating value for the

business operations of the Mitchell's.

Techniques of retaining customers:

Mitchells keeps in touch with its customers. It tries to retain its customers. Different

promotional activities are performed to retain the customers. Samuel Butler says that "Any

fool can paint a picture but it takes a wise man to be able to sell it." There are three

different techniques are being used by theMitchells.

Effective Communications:

Developing effective and consistent two-way communication skills is the first component in establishing

and maintaining a selling edge and developing long-term customer relationships. It is accomplishedthrough practice and constant exchange of thoughts, feelings, and reactions with those customers, clients

or prospects that have a distinct need and ability to acquire the products or services that you provide.

Mitchells is acting upon well in this and getting its targets in the competitive market of business.

Achievement Drive:

Mitchells management knows that a right attitude, a strong overpowering will to succeed is the second

key to achieving consistent sales. Studies show that top sales people from every field of endeavor have

more desire to achieve than the vast majority of their peers. They also gain personal satisfaction in

helping other people make sound buying decisions. This gives them the energy, stamina, enthusiasm, and

compelling motivation to attain the edge that produces higher rates of sales and high quality customer

service levels.

To successfully sell the products, Mitchells has developed a strong desire to succeed.

Daily Planning and Personal Management:

The mere possession of selling techniques does little to insure success. It is the person's attitude andwork habits that are important. (Dr. Richard H. Buskirk).

The third concept to be mastered, if you are to achieve success in selling, lies in your ability to schedule

your time wisely and work effectively during the periods you allocate to your sales promotional activities.

Mitchells is successful is successfully taking measurement of its sales on the daily basis. It takes report

from its regional offices on the daily basis and evaluates the performance of the regions and its sales.

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SEGMENTATION

Mitchells segments its products on the socio economic classes focusing on- A, B+ and B.

Target Marketing Strategy

Target market is the set of people whom company target to sell there product. Mitchells target children,

house wives, and families and try to develop there promotional campaign according to this. As they had

the first mover advantage they utilized it fully and initially promoted its products through newspapers,

posters radio channels. But they mainly invested there resources in building there corporate image.

PRODUCT IMAGE:

Mitchells is enjoying more then 38 percent market share against its competitor which tells the story of

Mitchells products image in market.

Pricing strategy:

When company starts producing its product they use penetrating strategy keeping in view the

competition. This is because to attain most market share. Now company is still following same strategy to

retain market share.

Pricing product:

Right price to product is very difficult. Price plays very important role in the sale of any product. So this

is one of the major issues. Mitchells are following quality based pricing out of survival, profit

maximizing, and market share leader pricing. This is because Mitchells is market leader now and they

are now just focusing only on the quality of the products so they price according to the quality of the

product.

Geographical price adjustment:

Price of the Mitchells remains the same within the Pakistan. There is not price adjustment within

Pakistan.

Factor consideration while setting prices:

There are some factors keep under consideration while setting the price of the product some them are:

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1. Consumer buying power.2. Cost of the product3. Pricing strategy4. Advertisement cost.

There are some of the factors which are considered while setting the price ofMitchells. Advertisement

cost is one which is not often considered because advertisement varied on different stages. So this is one

which is least considered.

Distribution channels:

A set of interdependent organizations (intermediaries) involved in the process of making a product or

service available for use or consumption by the consumer or business user.

About the Mitchells they are also using different distribution strategies to make there products available

to every consumer. The information about Mitchells distribution strategy and channel are as fellows:

Nature of distribution:

There are two distribution channels which are:

1. Direct channel.2. Indirect channel.

Mitchells is involved in indirect distribution channel. They are following this method:

Production Intermediaries retailers Final consumer

This is the distribution channels Mitchells is using to make there product available to every one.

Distribution policy:

There are also three types of distribution policies which are as fellows:

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1. Intensive.2. Selective.3. Exclusive.

Intensive distribution means place product to every store and try to address each and every consumer.

Selective means few well known general stores or departmental store are used to appeal people to there

product. We will focus on intensive distribution along with selective distribution because we will try to

appeal as many people as possible and through technique we will be able to address the most number of

people

Modes for distribution:

There are number of distribution mode like use tracks, rails, air planes, and pipes. But the company is not

involved in any of these. Company is only responsible to send the product to intermediaries which are

then take products to retailer. Company is just do only that they paint the transmission mode like trucks

which the theme of the company which show the product on the trucks. Modes are also set keeping in

keep these things which are fellows:

1. Dependability2. Availability3. Costs4. Speed5. other

Promotion:

Promotion is to promote product through advertisement and some other factors. It not only included

advertisement but also setting target market studying there requirements and develop product accordingly.

What are the promotional activity using by Mitchells and how they use them are as fellow:

Promotional strategy:

In the beginning the company is use push strategy to increase sales by setting low price try to penetrate

but by the time begin the strategy is changed to pull. It is because company now is being able to attain the

greater percentage of sales and now they are just considering to only retaining this position now.

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Promotional Activities:

To promote the sale of the Mitchells company is involve in number of activities which are using ads on

TVs placing bill boards and with arrange some sort of concerts and public related activities like health

related programs.

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Modes for Advertisement:

Company uses different modes of advertisement to make there message to reach to every one.

Advertisement modes include TV channels, news papers, bill boards, health and safety programs and by

publishing different health and safety related magazines. All these are use to make sure that they can

address all the people they are targeting to. TV channels include all the local most famous and often

watched channels and same is the case of the news papers. Company called these advertisement modes

above the line and below the line. Above the line include TV channels, cable networks, and exhibition.

And below the line contain health and safety programs and all that magazines.

SWOT ANALYSIS

STRENGTHS

1. There is not any alternative product available in the market.2. It will provide freshness to the customers3. It will have natural taste and nutrients.4. Brand loyal people will get attracted to the newly launched as it is unique.

Weaknesses

1. Mass inventory control problem will arise.2. It is a seasonal product, because in winter there will be oranges available in the market.3. The promotion mix of the company and advertisement programs is not very good. It is

justifiable to say that company is not so much serious in promoting its brands. Thecompany is only enjoying the good repute of the brand name Mitchells.

4. As we know that there is severe competition in the food industry, but still the availability ofMitchells products is very poor.

Opportunities

1. As the rural populations of the country tend to migrate to cities for multiple purposes, for thistrend enhanced the market size for the food processing companies. It is also an opportunity for

the MITCHELLS Fruit Farms Limited to avail this opportunity and get benefits from this

growing market.2. Now people are much conscious about their health and fitness as before the past. They have

tendency to use the foods that are nutritious and best for their health. So this market trend is also

creating new horizons for the food processing companies.

3. Other very open opportunity for the company is that the company may invest in new productcategories like other fruits in cans

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Threats

The competition in the food processing industry is much severe than the past. Now the many national

companies are joining hands with multi-national corporations for additional support in terms of marketing

activities, production expertise and financial resources

CHANGES IN OUR OPERATIONS

After adding this new product into production there will not any greater change in our operations

as we have already technology for canned fruits and vegetables. We have already expert

technical staff to operate that system.

To avoid the pressure on current employees we will hire some new food specialists. As it is a

new product but it is of the same league just like the other products Mitchell is offering, so some

daily wages employs will be hired who will work under the supervision of the specialists.

In order to preserve large amount of oranges, we will do contract with the orange suppliers. So

there shall be availability of oranges in large amount, which can be stored for the summers. We

will do contract with the suppliers seasonally. Means in every winter we will buy oranges from

them and will sale them in summers in the form ofOASIS.

There will not be any technological change, because the machinery is there to preserve the fruits

inMitchells. There are offering canned foods before and now just expanding their product range

by offering OASIS.

IDENTIFING PROSPECT:

Our prospects will be the upper class and the upper middle class of the community. And

sometimes the middle class who will buy our product occasionally, as it is a canned product, so

we will not target the lower class. We will focus on the upper class and the upper middle class

who will get attracted to our product OASIS quickly.

QUALIFYING PROSPECT:

One important thing after identifying the prospect is that the prospect should be qualified in

terms that he/she is able to make the purchase otherwise an unqualified prospect in of no use for

the company because he/ she does not have the power or authority to make a purchase. Sopitching for sale to this client is a waste of time who is either never going to be convinced or

even if they are, they wont be capable of doing so. Mitchells has already a large customer base

with stable financial positions so it has focus on the customers who have purchasing power.

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ADVANCED SELLING STEPS:

We are targeting the current customers ofMitchells so that they can be retained. So there will

not be any main problem to convince them to buy OASIS. Because the current customers know

about the quality Mitchells is providing to its customers so they can be easily convinced.

Mitchells sells its products to its final customers through its intermediaries. There is no direct,

door to door, or personal selling in Mitchells. All the sales are done through its sales

distributors. At some other level like famous hotels, restaurants, club, Mitchells sells its

products directly.

Sales Returns Procedures:

Mitchells take back its those products which proved bad, un-hygiene etc. through its

intermediaries.Mitchells takes responsibility if any of the products found bad.

Projected Income Statement

Year 1 Year 2 Year 3

Revenue 3450000 5700000 7280000

Staff Salary 672000 672000 830000

Gross Profit 2778000 5028000 6450000

General administration & selling

expenses: 2129400 3521700 4464000

Earnings Before Tax 648600 1506300 1986000

Tax @ 30% 194580 451890 595800

NET PROFIT/(LOSS) AFTER TAX 454020 1054410 1390200

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