Internship Report On SHAMA Ghee & cooking oil HGGM

Office of the Sales & Marketing Manager

Internship report submitted to the department of Management science, National University of Modern Languages to full fill the requirements of MBA Degree By:

Muhammad Asim
MBA (Evening) Roll no 10595 Session: 2009-2010

DEPARTEMENT OF MANAGEMENT SCIENCE

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Preface
This report is on Marketing of Hafeez Ghee & General Mill Limited and focused on its Marketing strategies. We have tried our best to make this report as much reliable and valid as possible. This report is conclusion of great effort. We have worked hard with devotion an order to present a high caliber report. Many of our friends helped us in collecting information also in preparation of report. Our best teacher Sir. Mohsin Ali, who is having honor of specialization in marketing, provided us very precious knowledge about market research and marketing strategies. We hope that this is a high caliber authentic work. We also hope that this is a simple, updated and purely focused on marketing strategies of Hafeez Ghee & General Mill Limited. We have tried our best to fulfill all ethical requirements an order to present an unbiased report. We are extremely thankful of all our friends and officials of Hafeez Ghee & General Mill Limited who provide us very forceful information related to their marketing strategies. Particularly Mr. Atif (sales and marketing manager). He made us able of doing such a high level work in a very short time. We hope that every one can get benefit of the report specially organizations who are in search of customer satisfaction. We welcome the suggestions for the improvement of the report. Thanks to all the readers.

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ACKNOWLEDGEMENT
All prays goes to Allah Almighty who has given me, courage and confidence to complete this gigantic task. But with the noble passion of hard work, nothing remains difficult. To write an acknowledgement, after the completion of an enormous task has always been very enthusiastic for me because its the best source to thank all those whose support enable me to complete this project. After thanking GOD I will thank to my parents & teachers who prayed for me and without their support I might not be able to complete this internship. I want to thank for all those personalities, who have been a continuous source of guidance during the report. I want to say thanks to all the employees of S Hafeez Ghee & General Mill limited. Their attitude towards me was really very positive and appreciable. I want to acknowledge them with thanks for their help and guidance on each and every step. I made many mistakes as I had never been confronted with the business world but they never minded and instead of minding they behaved like my brother. They treated me as their younger brother and forgave all my inaccuracies. But In this regard, I particularly want to thank those personalities who have been the continuous source of guidance throughout my internship

Table of Contents
Internship Report On............................................................................................................1

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SHAMA Ghee & cooking oil HGGM.............................................................................................1 By: .......................................................................................................................................1 Muhammad Asim.........................................................................................................................1 DEPARTEMENT OF MANAGEMENT SCIENCE.........................................................................1 Hafeez Ghee and General Mills.................................................................................................16 ...............................................................................................................................................17 Figures:..................................................................................................................................17 Balance Sheet HGGM...............................................................................................................39 Financial Statements Analysis...................................................................................................43 Quick/Acid Ratio.....................................................................................................................46 Inventory Turnover.................................................................................................................47 Average Collection Period......................................................................................................48 Debt Ratio..............................................................................................................................49 Time Interest Earned Ratio.....................................................................................................50 Gross Profit Margin Ratio.......................................................................................................51 Operating Profit Margin Ratio.................................................................................................52 Net Profit Margin....................................................................................................................53 Total Assets Turnover............................................................................................................54 Return on Total Assets...........................................................................................................55 Return on Common Equity.....................................................................................................56 Earnings per Share................................................................................................................57 Common Size Analysis..........................................................................................................58

Executive summary
I judge my time spent at Hafeez Ghee & General Mill ltd in Multan regional office as being the most productive and exhilarating experience of my corporate life. Before the details description of the report, started with the summary of work I done. The basic purpose of this summary is to given an idea about the contents and efforts made behind the completion of the report to the reader. It was assigned me to visit the HGGM to view the working environment, function, marketing procedures and behavior of doing work. Internship was started from 24-06-2010 and end on 04-08-2010, this period was the real experience e of my life and I saw the setup, working process and formal documentation of the HGGM. The HGGM is a FMCG organization with several departments in working in the head office Nowshera. The department administration which deals with the internees has assigned me HGGM Multan. HGGM gives me the opportunity to view, how the marketing strategies and plan are prepared, how to fill the different forms, how to behave wit customers and about the record

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keeping. Here staff gives me opportunity to do practical work. It was a really nice and fruitful experience for my upcoming practical life. I would like to conclude by saying that even though every person will have a different story to tell, the common factor that binds us all is the good work done by our predecessors in the NUML. I have given more than 100% of my efforts to keep up that good work and I am sure that my colleagues have done the same. I am hopeful that as we pass through the corridors of this great institution into the real world, this legacy will be kept and upheld by the future generation of NUMLians. The office of HGGM is located in the city of MULTAN BHAWALPUR ROAD, NEAR BYPASS CHOWK; HGGM is producing a food products both for consumers and industrial users. HGGM get ISO 9001 22000 14001 Certification - a Quality, food safety and environment Management System. While adhering to this Management System, the company is committed to strict quality standards in all its operations. HGGM annual turnover of Rs. 2 Billion; HGGM is producing number of products, both for consumers and industrial users. HGGM Products are sold to the consumers through local areas.

Mission
We believe in stepping forward into the future, striving to offer quality of product within the food industry that will change the status quality. Our expertise in manufacturing ghee & cooking oil, have been proven in all Pakistan. You know that, when you are using our brand, you will get the best of everything; (taste, quality, and nice packing)

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Vision
We want to make a chain from producer to consumer and make our product of highest quality and affordable to our customers. For us our customers take precedence & we take no chances with their health & satisfaction. We ensure safe, high quality products for our customers by being quality conscious and consistently improving our quality systems of distributors, retailers, outlets & direct sales.

Board of Director

Sheikh Amjad Rasheed

Chairman International Multi Group of Companies IMGC

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Sheikh Ahsan Rasheed

Director / CEO Hafeez Ghee & General Mills PVT, LTD

Sheikh Atif Rasheed

Vice Chairman International Multi Group of companies IMGC

Sheikh Ahmer Rasheed

Director Hafeez Ghee & General Mills PVT, LTD

Sheikh Aizaz Rasheed

Director International Multi Group of CO

Mrs. Ayesha Rasheed

Director Hafeez Ghee & General Mills PVT, LTD

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Management of HGGM

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Sheikh Ahsan Rasheed

Director / CEO Hafeez Ghee & General Mills PVT, LTD

Sheikh Mugeeb-urRehman
Manager Sales Hafeez Ghee & General Mills PVT, LTD

Mohammad Naveed Hashmi

Manager I.T Hafeez Ghee & General Mills (Pvt.) Ltd

Atif Qureshi
ManagerMarketing Hafeez Ghee & General Mills (Pvt.) Ltd

Shiekh Umair
Manager Purchase Hafeez Ghee & General Mills (Pvt.) Ltd

Nawaz Feroz
Manager Sales Oil

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Hafeez Ghee & General Mills (Pvt.) Ltd

Riaz Ahmed
Manager Sales Tax Hafeez Ghee & General Mills (Pvt.) Ltd

IMGC Global (Pvt.) Ltd. has been involved in Relief, Rehabilitation & Reconstruction Programmed since I 986. During last 3 years in Afghanistan and in earthquake disaster in Pakistan, IMGC have executed exceeding 1700 contracts valuing over 110 million USD on behalf of United Nations organizations, international NGOs, US Govt., USAID and Multilateral international organizations. IMGC is registered with all these organizations and has had an excellent performance record. IMGC has a reputation for rapid response, ex-stock position and offers services including construction and logistics besides relief and shelter items. Our buyers includes United Nations organizations and international NGOS such as ICRC, IFRC, UNICEF,WFP, WORLD VISION, Regional Red Crosses including American Red Cross, Swiss Red Cross, Finish Red cross, Belgium Red Cross, CRS, GOAL, IMC, SAVETHE CHILDREN, OXFAM,JEN etc.

Associated Industries Ltd., a ghee-manufacturing unit, was established in 1960 in Nowshera in an area of 65 acres with an adjoining residential colony. The building is designed by the famous firm of John Tarry & Block in consultation with Fried Krupp Heb of Germany who are the main suppliers of machinery as well. It produces ghee, cooking oil and soaps. Right from its inception in I 960, the Ghee brand SHAMA became an instant hit and market leader. The subsequent period witnessed the continuous lead with phenomenal growth in production from 10,000 tons to 65,000 tons. The reason for its success was its high standard of quality, guaranteed by its stringent quality assurance procedures. In view of the ever growing demand of SHAMA Brand, a number of imitators have entered the market with copied design, color and monogram of its pack. Nevertheless, our loyal consumers have always been able to identify the real

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brand.

The Ghee Manufacturing Unit was established in Multan in I 994 based on designs prepared by architects of repute and installation was carried out by qualified professionals. Hafeez Ghee & General Mills (Pvt.) Limited was incorporated in August I 994. Necessary additions to the building, plant, machinery and equipment have been made on regular basis. Under an agreement with Associated Industries Ltd., Nowshera, their brand SHAMA is manufactured and packed in this unit. As part of its expansion and modernization plans a Solvent Extraction Plant is already in production while margarine and water building plants are being set up thus providing a one window operation through HGGM.

Alliance Textile Mills Ltd., one of the largest textile manufacturing units in Pakistan, was established in 1952 as Fauji (Army) Textile Mills Ltd. Disinvested in 1985 it came under the present professional management in 1992. The new management launched an aggressive and forward-looking marketing approach, an initiative greatly helped by the modern and tested management techniques and equipment. With 33000 spindles and 118 looms operated by a workforce of 800 strong the facility is already reaching amazing heights finding itself in competition with the very best. Simultaneously the dynamism of the management is reflected in a programmed of sustained progress and improvement moving from spinning to stitching.

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The name International Multi Foods Limited is synonymous with food processing in Pakistan. In a relatively short period of time, IMF has leapt to the forefront of the national food processing and packaging industry. A testimony of the companys leading position is the large number of orders it continues to receive.IMF is one of the countrys largest exporters of food commodities to overseas market. Its major export brand is packaged food products are Desert Delight, winning export trophies for many years. IMF also imports large quantities of food products for local markets. It has its own packaging and warehousing facilities in Karachi, Nairobi, Singapore, Angoon and Dubai. The IMF processing factory in Sukkur is spread over an area of 3.63 acres and has an annual production capacity of 3500 metric tons.

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ADDRESSES
IMGC GLOBAL (PVT) LTD. Head Office
1106-1110, 11th Floor, Kashif Center, Shahrah - e - Faisal, Karachi, Pakistan Phone: (92 -21) 3566 2054 -3566 2098, Fax: (92-21) 3568 3010 Email: imgcglobal@yahoo.com chairman@irngcglobal.com

IMGC GLOBAL (PVT) LTD. Islamabad Office

Apartment No 2 Block 23, Ground Floor, Pakistan Housing Authority. 0 711, ISLAMABAD. Phone: 051 -2890265. 051 -289 0408, Fax: 051 -2891370 Email: abfrasheed1968@yahoo.com

IMGC GLOBAL (PVT) LTD. Lahore Office

T-02(B) 3RD FLOOR, REHMAN BUSSINESS CENTRE. 32: B-3 GULBERG - III LAHORE. Phone: 042- 35877331-35877332, Fax: 042-35873350 Email: imgcglobal@ymail.com

ASSOCIATED INDUSTRIES LIMITED.

AMANGARH INDUSTRIAL AREA. NOWSHERA Phone: 0923 - 610489 - 610598 - 610863, Fax: 0923-610830 Email:shamaghee2003@yahoo.com

HAFEEZ GHEE & GENERAL MILLS (PVT) LIMITED.

BHAWALPUR ROAD, NEAR BYPASS CHOWK, MULTAN. Phone: 061-6526513 - 6526589 - 6529877, Fax 061 -6526167 Email:sharna_mul@yahoo.com

ALLIANCE TEXTILE MILLS LIMITED.

G T. ROAD, JEHLUM Phone: 0544-649048-9, Fax: 0544 649047

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History Associated Industries Limited

AIL is the single largest edible oil (Ghee and Cooking Oil) unit in Pakistan. It has an annual capacity of 125,000 MT per annum for edible oil as well as 2000 MT of Soap and Detergent products. AIL was formed in 1960 by a visionary industrialist named Gul Muhammad. He named AIL as such because he wanted to integrate other manufacturing facilities associated with the Ghee Industry in this unit. Spanning 75 acres it is located in Nowshera, 25 miles south of Peshawar. It was nationalized by the Government of Pakistan in 1974 and became the single most profitable unit under the Ghee Corporation of Pakistan. IMGC took over control of the unit in 1992 by paying Rs. 400 per share as against the face value of Rs. 10 per share. Since taking over, IMGC has tripled the manufacturing capacity by investing continuously in Balancing, Modernization and Replacement (BMR) of the unit. Its brand SHAMA has been the single largest selling brand not only in the NWFP province of Pakistan but also in Afghanistan. AIL has one of the largest network of distributors for edible oil in Pakistan and Afghanistan. Despite the current turmoil in the NWFO province, AIL had a record production year last year with sales of over 75,000 MT and a turnover of over Rs. 4 billion in 2008-2009.

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Products:
Ghee Available in Assorted Tin and Plastic Pouch Packaging Cooking Oil Available in Assorted Tin and Plastic Pouch Packaging Washing Soap and Detergent

Figures:
Annual Production (2009-2010): 75,000 MT

Annual Sales (2009-2010): Rs. 4 billi

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Hafeez Ghee and General Mills

HGGM is one of the most progressive Ghee and Cooking Oil units located in the key region of Southern Punjab in Pakistan. It is situated on the outskirts of Multan which is the heart of the Agricultural belt in Pakistan. HGGM was a very small unit when IMGC bought it in 1994 with a then capacity of a mere 800 MT per month. Since then IMGC has heavily invested in upgrading this unit to become one of the elite Ghee units of the country. The Annual Capacity of the unit is now 36,000 MT with recorded sales of Rs. 2 billion in 2008-2009. HGGM added a Solvent Extraction unit in 2008 and it is now fully functional and operational. It has a crushing capacity of 200MT per day with production of 40 MT of crude edible oil and 150 MT of Oil cakes per day. This facility gives HGGM the opportunity to produce up to 20 percent of the raw material requirement in house and become an important player in the oil cake market. Future plans include an addition of a Feed Factory to add value to the oilcakes and produce high quality feed for the cattle and poultry industry in Pakistan. HGGM has a large marketing network in all the key regions in Northern and Southern Punjab. The network has over 60 distributors in all big and small town spanning 1000 miles. HGGM has its own sales and marketing wing that services the very important Multan city. HGGM is considered to be the marketing leaders in the Southern Punjab region with its innovative campaigns and publicity outlets.

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Types of Brand HGGM

Shama ghee & cooking oil (NSB, ISB) Hafeez ghee CSD ghee & cooking oil Utility Ghee & cooking oil Shama puff (Industrial margarine) Crude oil (sunflower, canola) Shama soap

Figures:
Annual Production (2009-2010): 36,000 MT

Annual Sales (2009-2010): Rs. 2 billion

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Our Principles
Strong businesses are built on the principles of Trust, Accountability and an Environment that allows their people to reach their full potential. At HGGM live by the following principles when conducting our day to day work.

Integrity
we act with honesty, integrity and highest ethical standards. We adhere to the laws and regulations pertaining to our work and with HGGM principles and policies.

Fairness
we work with people in a way which is fair and appropriate. We treat fairly our customers, suppliers, shareholders and the communities in which we live and work.

Trust
People can trust us to fulfill our commitments. At the same time we also trust others to be true to their commitments to us.

Accountability
Along with trust comes accountability we believe all of us are uniquely created with the ability to reason, make decisions and be held accountable for our commitments and actions. We hold ourselves accountable for fulfilling our responsibilities and commitments.

People reaching their full potential

Each one of us is creative, thoughtful, trustworthy, fair, capable of making important decisions and responsible for our actions; however we believe each one of us is also different and has unique potential and talents to make positive contribution to the organization and the world. We strive to work together in a manner so that each one of us can develop in the organization and reach to our full potential.

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Production Department
Health is a serious issue and HGGM taking seriously this matter their products are manufactured under quality control & food safety standard guidelines and always ensures the food safety through hygiene and safety measures. We at HGGM have the ghee & cooking oil manufacturing facility with advance technology and using by latest techniques.

Technology used in HGGM

Vacuum distillation technology

Production Capacity
150 metric ton

Our Processes

Ghee
Definition: Saturated triglyceride of free fata acid is known as ghee. Oil use for making ghee Palm oil Refined Bleached and deodorized Cotton seed

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Pre- Neutralization
Reaction edible oil with caustic soda causes production of soap contents Which removed by water washing edible oil soap stock so removed by batch process Temperature is 40 to 50 oC In this process time consumed 1 hour or 1.5 hour Pre- Bleacher oil heated 80 aur 100 oC for moisture remove Fuller earth use for reduced color At the end of bleaching process the oil is filtered in filter press to remove the spent bleaching earth In this process time consumed 1 or 2 hour

Hydrogenation Oil heated with steam in coils 200 or 230 oC Nickel catalyst fed into process Hydrogen gas passed in that process
When its melting point (362 oC) than stop hydrogen pass process Then the hydrogenated nickel catalyst mixed oil is first cooled from 200 oC and

then it is filtered through a filter press. Time consumed 4 hour

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Post- Neutralization Hard and soft oil mix according to required quantity to reduce FFA through caustic soda Temperature 60 or 65 oC Time consumed 1.5 hour Post- Bleacher In this process decrease the color of oil with the help of fuller earth. Temperature 60 or 65 oC Time consumed 1.5 hour

Deodorization: Remove smell of oil Oil heated 3 to 4 hour at 200 to 230 oC under high vacuum by injecting open steam Smell and sponified matter, moisture unsponified matter and gum completely removed In this process citric acid also used After this process oil colled and than it finally filtered Idle color should be less than 4.0

Cooking oil
Definition: Unsaturated triglyceride of free fatacid is known cooking oil Cooking oil made from Rape seed oil Sun flower oil

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Soya bean oil Cotton seed Canola Process

Pre- Neutralization Phosphoric acid (H3PO4) removal of gum

Caustic soda (NaOH) removal FFA

Reaction edible oil with caustic soda causes production of soap contents Which removed by water washing edible oil soap stock so removed by batch process Temperature is 40 to 50 oC In this process time consumed 1 hour or 1.5 hour

Pre- Bleacher oil heated 80 aur 100 oC for moisture remove Fuller earth use for reduced color At the end of bleaching process the oil is filtered in filter press to remove the spent bleaching earth In this process time consumed 1 or 2 hour Deodorization: Remove smell of oil Oil heated 3 to 4 hour at 200 to 230 oC under high vacuum by injecting open steam Smell and sponified matter, moisture unsponified matter and gum completely removed In this process citric acid also used After this process oil colled and then it finally filtered

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 Idle color should be less than 2.0

Packaging Section In this section ghee is filling into Tins & Buckets. Ghee and oil is filling into different pouchs these are such as

Empty CTN 110 kg NSB 10 kg NSB 10 kg NSB 112 kg NSB 12 kg NSB 12 kg NSB 116 kg NSB 16 kg NSB 16 kg NSB 15 kg NSB 110 kg HB 10 kg HB

Film Roll 1 kg NSB kg NSB kg NSB 1 kg HB kg HB kg HB 1 Ltr. (S.C.O) Ltr. (S.C.O) Ltr. (S.C.O) 1 kg Usc Ghee 1 Ltr Usc Oil 1 kg CSD

Empty Tin/Bucke t 16 kg Tin NSB 5 kg Tin NSB 2.5 kg Tin NSB 16 kg Tin HB 10 kg Tin HB 5 kg Tin HB 2.5 kg Tin HB 16 kg BKT NSB 10 kg BKT NSB 5 kg BKT NSB 2.5 kg BKT NSB 16 kg BKT HB

10 kg HB 112 kg HB 12 kg HB 12 kg HB 112 Ltr. (S.C.O) 110 Ltr. (S.C.O) 15 Ltr. (S.C.O) 15 kg CSD 5 CSD 15 CSD kg Ltr

1/2kg CSD 1 Ltr CSD

10 kg BKT HB 5 kg BKT HB 2.5 kg BKT HB 16 Ltr Tin SCO 10 Ltr. Tin SCO 5 Ltr. Tin SCO 2.5 Ltr. Tin SCO 5 Ltr. Bottle SCO 3 Ltr. Bottle SCO 1 Ltr. Bottle SCO 5 Kg Tin CSD 2.5 Kg Tin CSD

116 kg USC 116 Ltr USC

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Soap
After the process of Pre/Post neutralization the soapy oil is drained from vessel and takes for manufacturing of soap. In soap section mix the silicon, sodium hydro oxide, soap stone and water into soapy oil and then heated and mix and boil. After this we take the soap into the boxes, and after this soap are ready for cutting and packing.

ISO Department
Mr. Shair Zaman Manager ISO. ISO mean International Standard Organization who set the standard about product quality, environment, food safety etc. HGGM five times awarded with ISO standard includes Quality, Environmental, and Food Safety. HGGM have three types certificates of ISO. ISO 9001: 2000 ISO 14001:2004 ISO 22000:2005

ISO 9001: 2000

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Quality Management System focuses on quality improvements in products, services and process by meeting the customers requirements with the aim of continual improvement

ISO 14001:2004
This International Standard covering environmental management are intended to provide organization with the elements of an effective environmental management system (EMS) that can be integrated with other management requirements and help organization achieve environmental and economic goals.

ISO 22000:2005
HGGM is the first ISO 22000 certified ghee & cooking oil manufacturing unit in Pakistan. ISO 22000 provides the food safety guidelines at overall stages of goods manufacturing, handling, and storage.

Marketing Department
Marketing Department hierarchy Number of employee work in marketing department Function of Marketing Department Marketing strategy Market segmentation Marketing Mix

Number of employee work in marketing department

In marketing department of HGGM numbers of employee are three. His marketing manager is Atif Qureshi who deal and perform marketing function.

Function of Marketing Department

These are some important function of marketing department of HGGM

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Focus on the Customer Monitor the Competition Find & Direct Outside Vendors. Create New Ideas. Communicate Internally. Manage a Budget. Understand the ROI. Set the Strategy, Plan the Attack, and Execute. Customer Relationship Management Marketing Research Sales Forecasting Price Analysis

Marketing Strategy
Ever company or organization has some vision through which the organization sees itself in some future time. This can be a desire of each organization. This is the future plan and it should be very clear and SMART (Specific, Measurable, Achievable, Realistic and Time Framed). The more it is SMART the more it is better. This is made by top management, who always fight in the market for the survival of the organization. They made different strategies to achieve their vision. Marketing is the most important one among these strategies. In todays competitive market every organization needs a good marketing strategy. Marketers use different tools for marketing.

Following

are

Marketing

Tools

which

HGGM

Limited

uses:

(1) ATL (above the line):

They and Cable. use different advertising and promotions on T.V

(2) BTL (below the line):

They use Posters, Boarding, Banners, Stringers, Hangers, Wall Clocks, Key Chains, Diaries, Calendars, Pump flits, Brushers, and Sticker.

Our competitors

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QADIR banaspati & cooking oil, HOOR banaspati & cooking oil, SUFI banaspati & cooking oil, SOYA supreme cooking oil, DALDA banaspati & cooking oil, SULTAN banaspati & cooking oil

Advertising Objectives
To make Shama as a National Brand in all over the Pakistan. To popularize and aware the public through effective and efficient marketing strategy.

Market share Ranking: 1. Sultan ghee & cooking oil 2. Shama ghee & cooking oil 3. Hoor ghee & cooking oil 4. Qadir ghee & cooking oil 5. Dalda ghee & cooking oil

Budgeting
HGGM spare 2 karore annually for Shama Brand promotion. 1 karore/annum can also be approved from head office Karachi if they need for promotion purposes only.

For Distributors
2 rupees/kg is given to the distributors when they achieve the target. These are the incentives only if any distributor fails to achieve the target then these incentives are not given. They also have some trade schemes for example 16 kg bulk pack is given to the distributor on 1500 if its market price is 1610. They offer different types of trade schemes time to time to keep the distributor motivated.

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For Consumers:
They also offer different types of schemes for attracting consumers. Product +add product For example Shama Ghee + Jame Shereen Shama Ghee + soap Shama Ghee + Tapal Tea etc

Market Segmentation

Premium Mothers playing an influence role in the decision making. Female (age 25-35 yrs) Low income segment (mid price)

Percentage of sale
TINS POUCHE BOTTLE

15% 75 10%

What they (customer) want:

High quality refined banaspati. Taste of ASLI ghee and demand fat less banaspati. Heart diseases & other chronic diseases are increasing day by day; a large segment has shifted to cholesterol free oil. Consumers have a similar demand from banaspati. Same quality but affordable price In premium segment, consumer are not price sensitive but are health conscious, so its demand differ from other segment who want quality at low price. Therefore consumer price sensitivity also is of vital important.

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How they use product

Customer can use this by following ways Cooking in house In restaurant Food factories Catering

How to reach them

Grocery store General store Whole seller outlet

Marketing Mix Price

(1)Pricing Objectives:
Their main strategy is Market Penetration means they keep affordable prices and keep good quality standards.

(2) Demand:
Their current demand is almost 3000 MT per month which covers the Northern and Southern demand.

(3) Total Cost:

This aspect is not mentioned. It is kept secret due to some reasons but they charge on bases of market demand so they normally get very high profit than their cost.

(4) Competitor Prices and offerings HGGM:

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b Brand Names Shama ghee/cooking oil Hoor ghee/cooking oil Qadir ghee/cooking oil Dalda ghee/cooking oil Sultan ghee/cooking oil

weight
5kg/5kg 5kg/5kg 5kg/5kg 5kg/5kg 5kg/5kg

P Prices
850/950 840/840 840/840 940/930 850/845

(5) Pricing Method:

They look to market trends, for example the price of 1kg plastic pouch was Rs: 70 before the political crises of Jan 27. But soon after the sad demise of Benazir Bhutto the prices rises to Rs.130 and they are expected to raise more in coming few days. F.C + V.C + Market Trend and Situation

(6) Final Price:

They usually sell it to their distributors and these distributors further sell it to retailers and these retailers.

List price of every product Tins Pouche Bottle 16kg 5kg 5kg Rs:2740 850 950

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Place
Distribution channel:
Like whole seller and retailer etc. involve in supply chain management.

Target Market:
Shama covers the Northern and Southern areas, means his target markets.

Consumer Distribution Channel:

Distribution Channel is the most important task for every company. They create the image of your products also they present your product to the final consumer. Every company wants to establish an efficient and effective distribution channel. Following is the distribution channel of Hafeez Ghee & General Mill Limited. They sell their product to Distributor and give target to him. He is responsible for achieving the target. They give incentives on achievement of the target. The Distributors further sell the product to Whole Sellers. Then the Whole Sellers further sell it to Retailers. These retailers then sell this product to consumers.

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Promotion
Advertising plan: Latest terms ATL and BTL use in promotional programs. In these terms all types of
advertisement include like T.V. Radio, billboards etc.

General publicity:
They use two types of tools for general publicity.

(1)Items:
Different types of items are used for general publicity for example writing pad, key chain, walk clock, wrest watch, cups, pens, wallets etc. (2)Activities:

Sponsorship:
They sponsor different types of events for example cricket, festivals, Islamic events and social etc.

NGOs SPONSORSHIP DISTRICT GOVERNMENT SPONSORSHIP BIN QASIM BLIND CENTRE FATMID FOUNDATION HERITAGE COLLEGE FOR HIGHER EDUCATION AL NOOR TRUST SOS CHILDREN VILLAGE

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Shama Ghee Display Competition:

In this competition retailers defined time of competition i.e. retailers keep Shama Bulk Packs RSMs (regional sales managers) give prizes to winner. are informed about one month. In which in front of his shop. visit to these retailers the the The and

Give away:
When some special personality visits to HGGM, he is given Shama Ghee as a gift or other items as a gift. Similarly when HGGM Officials visit to some special personality they take Shama Ghee as a gift. There are many more such kinds of activities which are used for publicity

Others:
Road barriers, complaint boxes, and display board on stores and other areas use for publicity.

Product

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Product names:
Shama Banaspati, Shama cooking oil two major brand of HGGM. Shama soap detergent, soya bean, canola oil, crude oil, and cotton seed are the part of HGGM.

Quality:
Vitamin A & D low cholesterol, these types of quality ingredients involve in shama product. So its quality is better than others, because customers are health conscious so he preferred low cholesterol ghee.

Scope of product:
Two type of segment involve in this field, one I s household and other is industries customers involves, our huge demand are industrial segment because shama is popular brand in industrial sector through quality vise.

Shama Pure Cooking Oil with Vitamin A & D Low Cholesterol Available in Pet Bottle (1, 3 & 5 Liters)

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Shama Pure Cooking Oil with Vitamin A & D Low Cholesterol Available in Pet Bottle (1, 3 & 5 Liters)

Shama Pure Cooking Oil with Vitamin A & D Low Cholesterol Available in dispenser 1 Liter Each (Pack of 5)

Shama Pure Cooking Oil with Vitamin A & D Low Cholesterol Available in Poly Pack 1 X 5 Liters.

Shama Pure Cooking Oil with Vitamin A & D Low Cholesterol Available in Tin (2.5, 5, 10) Lit.

Shama Banaspati With Vitamins A & D Available in 1 KG X 5 KG pouch in dispenser Pack.)

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Shama Banaspati With Vitamins A & D Avaiable in small pack 5 KG & 2.5 KG Bucket.

Shama Banaspati With Vitamins A & D Available in 1 KG & 1/2 KG Pouch Pack.

Shama Banaspati With Vitamins A & D Small Pack. Available in 5 KG. Tin & 2.5 KG. Tin

SWOT Analysis

Strength

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Brand SHAMA has been the single largest selling brand in the NWFP and Afghanistan ISO 9001:2000 Certified: The Company has a well-defined quality policy and has successfully obtained the ISO-9001:2000 quality system certification in the year 1997. HGGM five times awarded with ISO standard includes Quality, Environmental, and Food Safety. HGGM is the first ISO 22000 certified ghee & cooking oil manufacturing unit in Pakistan In govt. Utility stores utility ghee also provided HGGM.

Weakness

SHAMA is a very old brand there has been no change in packaging since ages, people feel that the new better packaged brands have better products. The brand suffers with an image problem. It is perceived as an old brand and the consumers are bored with it. There has been no innovative packaging change since 1994.

Opportunity

The company can cash on Shama to introduce new products; they have a large market share in the central and northern areas of Pakistan. People in the metropolitan areas are inclined towards branded products.

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The fat free banaspati is still popular and can be advertised to gain the market in health conscious people. People are becoming health conscious and are switching to brands offering vitamin and cholesterol free attributes. There is a growing segment of working women in search of modern and convenient methods of cooking. Therefore, the flavored oils stand a very good chance. Shows emotional attachment as well as health Benefits

Threat

The market is now being entered by Soya bean canola and sunflower oils, these are being bought by health conscience people this will lead to Shama decline in market share. The overall market of oil and banaspati is declining due to the Fluctuations in the world oil prices. Banaspati is perceived to be old fashioned and unhealthy by the upper income/urban consumers. Lately sunflower and Canola based single oils have aggressively entered the market. The unbranded segment comprises an enormous 50 % of the edible oil and Banaspati market. This is sold loose to the rural/lower income consumers. Indirect Competition is a threat and a chance that may grow in future. Due to Price factor and Quality standard competitors are giving high task. Different types of competitor are entered in the market with the passage of time.

PEST Analysis
Political analysis

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Democracies are under pressure to show they can protect the health of their population. Global society is under pressure to demonstrate it can mobilize resources to effectively tackle global social problems. Tackling health problems requires long term thinking, complex partnership & innovative forms of organization. Health suffers severs consequences in wars & other complex emergencies.

Economic Analysis
Wealth creates health, & health creates wealth virtuous & vicious spirals are possible. However, this is an area where market failures are common & pervasive. The value of a healthy, well educated population is increasing as the technological sophisticated of the world economy grows. Rising prices of palm oil, many chronic health problems (new infection disease or drug resistant strains) have the potential to impose enormous costs in a short period of time.

Social Analysis
Health is important to people and is consistently regarded as a high priority by rich & poor. The ability to mobilize in the face of health threat is a test of a society, while the act of mobilizing creates social cohesion & powerful social structures. There is a complex interaction between the rights of an individual to good health; his or her responsibility to protect his or her own health; the rights of a community to protect itself against health threat; & its responsibility to provide for the health of its member. Health protection requires action across society, professions; organization etc. public health also relies on public support for its license to operate & its ability to change behavior.

Technological
Health problems are always dynamic & sometimes this change is unpredictable. Health intervention can themselves lead to new health problem. Without knowledge about health, there can be no response to health threats. Technology is poorly distributed in areas where people are unable to create demand for it effectively. New technologies are the result of increasingly sophisticated processes & currently seem to be of decreasing cost effectiveness. New technologies pose poorly understood risks, as well as offering hard to quantify benefits. Information technology has the potential to revolutionize the dissemination of knowledge about health.

Balance Sheet HGGM

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ASSETS 2008
NON- CURRENT ASSETS Property, plant and equipment 5, 675, 577, 1 Investment property 2,724,587 Long-term investments Long-term loans and advances 85, 509, 3 Long-term deposits 38, 965, 4

2009

5, 137, 619, 0 2, 705, 804 77, 035, 9 38, 965, 4

CURRENT ASSETS
Stores, spare parts and loose tools 265, 575, 9 Stock-in-trade 773, 761, 5 Trade debts 663, 921, 1 Loans and advances 56, 556, 6 Trade deposits and short-term prepayments 22, 492, 5 Other receivables 12, 147, 8 Other financial assets 54, 708, 0 Cash and bank balances 294, 164, 5 290, 379, 0 502, 292, 2 433, 457, 1 58, 937, 5 15, 415, 9 12, 154, 0 201, 856, 8 142, 969, 5

10,310,457, 9

101134112

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NON-CURRENT LIABILITIES 2008 Long-term financing 2, 785, 751, 9 Long-term deposits 12, 315, 7 Deferred liabilities 1, 003, 595, 7 CURRENT LIABILITIES Trade and other payables 1, 645, 840, 9 Profit / financial charges payable 106, 663, 3 Short-term borrowings 125, 000, 0 Current portion of long term financing 415,091,2 Taxation - income tax - net of advance tax 46, 848, 6 Sales tax 3,766,4

2009

2, 735, 239, 9 8, 805, 6 1, 132, 937, 8

591, 685, 0 89, 010, 1 662, 000, 0 785,808,3

10,310,457, 937

10,113,411,22 5

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Profit Loss Account 2009 2008

Sales-net 6,178,399,033 Cost of sales 4,216,643,662 Gross profit Other operating income 27,392,429 27,419,688 1,566,117, 176 Distribution cost 68,292,101 Administrative expenses 240,361,887 Other operating expenses 78,900,914 Finance cost 604,981,196 Share of loss of associates - net of tax 8,744,825 1,989,175, 059 5,735,795,493 4,197,070,746 1,961,755, 371

62,951,958 231,781,301 51,310,878 600,871,299 9,239,805

956,155,24 1

1,001,280,9 23

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Profit before taxation 987,894,136 Provision for taxation 357,439,095 Profit after taxation

609,961,935 147,244,514

462,717,42 1

630,455,04 1

Financial Statements Analysis

Financial statements are prepared to meet external reporting obligations and also for decision making purposes. They play a dominant role in setting the framework of managerial decisions. But the information provided in the financial statements is not an end in itself as no meaningful conclusions can be drawn from these statements alone. However, the information provided in the financial statement is of immense use in making decisions through analysis and interpretation of financial statements. Financial statement analysis is defined as The process of identifying financial strengths and weaknesses of the firm, by properly establishing relationship between the items of the balance sheet and the profit and loss account. There are various methods or techniques used in analyzing financial statements, such as Vertical analysis

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Horizontal analysis Ratios analysis.

To analyze the performance of HGGM Limited, these analysis and interpretation is given in the following pages.

Current Ratio
It measures the ability to meet current Debts with current Assets. It determines short term Debt paying ability of a Company. Normally firms are considered in better position. Current Ratio Years Findings 2008 0.79 2009 0.91

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Quick/Acid Ratio
It measures the ability to meet current Debts with most liquid current Assets. Normally firms are considered in better position, when their Quick/Acid test ratio is 1.0 or higher.

Quick/Acid Test Ratio Years Findings 2009 0.338 2008 0.466

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Inventory Turnover
It measures how many times the inventory has been turned over (sold) during the year; provides insight into liquidity of inventory and tendency to overstock. Normally firms are considered at a better position when they have Inventory Turnover 6 or higher. Inventory Turnover Years Findings 2009 14 times 2008 18 times

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Average Collection Period

It measures the number of days in which on account sales can be recovered. It basically shows the performance of recovery/collection process of a company.

Average Collection Period Years Findings 2009 45 2008 55

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Debt Ratio
It shows the relative extent to which the firm is using borrowed money. Normally firms are considered at better position when this ratio is not more than 0.7, but when the firms profit are more and is investing in more new projects or extending the existing then it might be more than 0.7. Debt Ratio Years Findings 2009 48 2008 45

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Time Interest Earned Ratio

It indicates the ability to cover interest charges; tells number of times interest is earned.

Time Interest Earned Ratio Years Findings 2009 1.858 times 2008 2.488 times

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Gross Profit Margin Ratio

Gross profit equals the difference between net sales revenue and the cost of goods sold. Comparing gross profit to net sales is termed as the gross profit margin.

Gross Profit Margin Ratio Years Findings 2009 31.75% 2008 28.38%

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Operating Profit Margin Ratio

Operating Profit Margin ratio gives the measure of Operating income dollars generated by each dollar of Sales. While it is described for this ratio to be high for a firm as compare to its competitors within the industry. Operating Profit Margin Ratio Years Findings 2009 25.92% 2008 23.53%

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Net Profit Margin

This ratio gives the measure of net income dollars generated by each dollar of Sales. While it is described for this ratio to be high for a firm as compare to its competitors within the industry. Net Profit Margin Ratio Years Findings 2009 1.25% 2008 1.889%

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Total Assets Turnover

It measures relative efficiency of total assets to generate sales; it is also called Capital Turnover. Greater Total Assets Turnover reflects the better position of the Company. Total Asset Turnover Years Findings 2009 0.958 times 2008 1.858 times

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Return on Total Assets

This ratio measures the firms ability to utilize its assets to create profits by comparing profits with the assets that generate profits. Return on Total Assets Years Findings 2009 1.2% 2008 3.5%

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Return on Common Equity

This ratio measures the returns to the common shareholders. Return on Common Equity Years Findings 2009 0.198 2008 0.236

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Earnings per Share

The amount of income earned on a share of common stock during an accounting period is termed as Earning per Share. Earnings Per Share Years Findings 2009 30.89 2008 30.49

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Common Size Analysis Vertical Analysis Income Statement

Years 2009 2008

Sales Net Cost of Sales Gross Profit Operating Exp. (Administrative) Operating Profit Other Income Net

100% 92.46% 7.54% 1.37% 6.17% 0.08% 6.25%

100% 93.92% 6.08% 1.34% 4.74% 0.32% 5.06% 2.24% 2.82% 0.93% 1.89%

Financial & Other Charges Profit for the Year before Tax. Taxation Profit for the Year after Tax.

3.56% 2.69% 1.44% 1.25%

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Vertical Analysis Balance Sheet

Years NON CURRENT ASSETS: Fixed Assets: - Operating - Non-operating Capital Work in Progress Investment Properties Stores held for Capital Expenditure Investment Loan, Deposits & Prepayments 41.2% 0.06% 0.42% 0.01% 0.01% 1.6% 0.53% 39.37% 0.09% 1.52% 0.04% 0.01% 0.09% 0.61% 2009 2008

43.83% Current Assets: Stores, Spares & Loose Tools Stock in Trade Trade Debtors Advances, Deposits, Prepayments & other Receivables Cash & Bank Balances 1.54% 36.35% 7.73% 8.55% 2.0% 56.17%

41.73%

1.38% 31.05% 8.53% 16.39% 0.92% 58.27%

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100% Years EQUITY & LIABILITIES: Share Capital Capital Reserves Unappropriated Profit Share Holders Equity Surplus on Revaluation of Fixed Assets Non Current Liabilities: Long Term Finances Long Term Loans Liabilities against assets subject to Finance Lease Deferred Liabilities Current Liabilities: Current Portion of Long Term Liabilities Short Term Finances 3.39% 46.43% 11.37% 5.9% 0.04% 1.58% 3.89% 0.51% 7.83% 12.23% 10.32% 2009

100% 2008

5.25% 0.69% 8.96% 14.9% 0.0%

17.17% 7.03% 0.38% 2.16%

4.02% 43.34% 6.19% 4.61%

Creditors, Accruals & other Liabilities 6.06% Provision for Taxation 2.47%

Index Analysis Horizontal Analysis

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Income Statement
Years Sales - Net Cost of Sales Gross Profit Operating Exp. (Administrative) Operating Profit Other Income Net 2009 76.51% 74.98% 102.06% 81.22% 108.23% 22.69% 103.29% Financial & Other Charges Profit for the Year before Tax. 93.03% 120.97% 2008 109.88% 109.38% 118.24% 114.2% 119.43% 133.18% 120.22% 84.17% 182.36%

Taxation Profit for the Year after Tax.

69.22% 870.67%

64.46% 1890.16%

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Horizontal Analysis Balance Sheet

Years NON CURRENT ASSETS: Fixed Assets: - Operating - Non-operating Capital Work in Progress Investment Properties Investment Loan, Deposits & Prepayments Current Assets: Stores, Spares & Loose Tools Stock in Trade Trade Debtors Advances, Deposits, Prepayments & other Receivables Cash & Bank Balances 148.81% 203.30% 146.94% 103.73% 147.35% 166.31% 157.96% Years EQUITY & LIABILITIES: Share Capital Capital Reserves Unappropriated Profit Share Holders Equity Non Current Liabilities: Long Term Finances 106.88% 119.52% 100% 100% 190.51% 143.74% 100% 100% 161.4% 129.67% 2009 98.73% 128.59% 120.16% 147.23% 49.96% 127.76% 116.95% 2008 186.82% 90.90% 5.95% 30.32% 2421.45% 220.12% 148.41% 132.12% 100% 15.9% 70.53% 100% 100% 189.8% 104.59% 2009 2008

Stores held for Capital Expenditure 100%

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Long Term Loans Liabilities against assets subject to Finance Lease Deferred Liabilities Current Liabilities: Current Portion of Long Term Liabilities Short Term Finances Creditors, Accruals & other Liabilities Provision for Taxation Workers Welfare Fund Unclaimed Dividend

165.9% 4.7% 99.25%

146.4% 30.29% 100.41%

104.35% 226.48% 49.97% 116.54% 318.83% 100% 150.81% 157.96%

91.64% 156.48% 37.78% 160.47% 231.56% 100% 113.46% 116.95%

Conclusion
To conclude all three process (SWOT, PEST and 4 P's) have affected our strategy and marketing decisions. The SWOT analysis has help us to acknowledge and comprehend our weaknesses, which will be a benefit because now we know our weaknesses all we need now is search for a way to eliminate them. The PEST analysis has drawn our awareness to

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the external forces that may have an influence on the products. Therefore, when making marketing decisions the factors found will be taking into consideration. The competitive Audit has showed us where HGGM Limited competitors are (what level they are on) which is also a benefit because we can see what we are up against, what we have to do to get ahead and whether we are disadvantaged in anyway. This is very important in the competitive environment because as a competitor, you cannot allow rivals to gain advantages in any form or way This internship proved to be very helpful for me. I got a lot of knowledge and also the practical aspect of life. It was my first experience, which was obviously very tough, but it will be very beneficial for me in the future. As a whole HGGM Limited is a good organization to work in but there are certain departments that need improvements. It is surviving in the FMCG sector with some strengths and weaknesses. I am of the view that if HGGM Limited management wants to show the same results in the future than it should have to take some decisions before time, because in 21st century only those organizations can survive which are using their human resources and material resources with popper planning and wisdom. HGGM Limited has a very good image in the Northern and Southern market. They are using different types of marketing tools. They are quite successful in achieving their targets just because efficient and effective marketing strategies. In spite of all these their promotion on T.V is not very good. There message and appealing factor is seen weak. So they need to focus on this as soon as possible. Their vision is also quite impressive if they succeed to achieve their brand will be a national brand.

Recommendation
Kiosk Activities:
Stalls are hired in bazaars like Itwar Bazaar. Wall clock, cooking spoons, cup etc are given on purchase of small packs of Shama Ghee in these stalls.

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Special Events Activities:

Special events like free pakowra stall in populated bazaars during Ramadan. These stalls are publicities in congested bazaars.

Shama Cooking Competition:

They go to female schools, colleges and universities and motivate the student to cook different types of dishes. These students are provided the necessary ingredients for cooking including Shama Ghee. Then prizes to good cooker is given.

Introducing scratch scheme Introduce discount Introducing gold scheme Introduce hajj scheme Associate with other brand Create awareness our soap with shama ghee Introduce VTF technology Reposition our brand Cooking programs on T.V

References
www.shamaghee.com www.imgc.com.pk www.google.com

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