STRATEGIC MARKETING MANAGEMENT

PROJECT REPORT

INTERNATIONAL ISLAMIC UNIVERSITY

ISLAMABAD

SUBMITTED TO SIR IMRAN QURESHI

NAME SAADALI KHAN
REG # 6238-FMS/MBA/F13
CLASS MBA (30) A
 ACKNOWLEDGEMENT

We are very thankful to Almighty Allah who gave us the opportunity, courage and insight to
explore more knowledge to complete this whole report and for his blessings that have brightened
in all parts of our lives and our parents whose prayers always supported us in every task. In
scripting this project, we were guided by our experience, knowledge and interest in the subject
Strategic Marketing Management. Beyond of all the material available we are thankful to our
respected resource person Mr. Imran Qureshi for giving us such a deep knowledge about the
subject, which made strategic marketing management very interesting subject. That is possible
due to her unique and natural style of teaching we ever experienced during our academics and
through his motivational behavior we are able to complete this difficult task. I am also thankful
to the management of Annaj fruit farms who guided us in the project in very supportive manner
during our visit to their office.

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 EXUCTIVE SUMMARY

Projects are integral part of MBA programmed. Main purpose of project is to have practical
knowledge. It provides a student to get practical experience and give inner view of the
organization selected. We have selected for our project. We have given the brief review of the
Annaj store. We have explained different introduction, history, operations, competitors, and
organizational structure of Annaj store .We have done Environmental analysis of Annaj store in
which we discussed about PEST; political, economic, social and technological factors in detail .We
have done performance analysis of Annaj store in which we have drawn BCG Matrix. We have
done Internal and External analysis of company in which we have done SWOT Analysis of Annaj
store. On the basis of our all analysis we have selected and implemented Build Strategy and did
the SCORPIO Techniques for Annaj store.

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TABLE OF CONTENT:

1.0 INTRODUCTION TO ANNAJ. 06

1.1 Name 06

1.2 Location 06

1.3 History 06

1.4 Owners/ Management/ Hierarchy 07

1.5 Competitors 08

1.6 Operations 08

2.0 ENVIRONMENTAL ANALYSIS. 09

2.1 PEST Analysis 09

2.1.1 Political Factor 09

2.1.2 Economic Factor 11

2.1.3 Social Factor 13

2.1.4 Technological Factor 14

3.0 PERFORMANCE ANALYSIS. 14

3.1 BCG Matrix 14

3.2 Comparison of Year 2012-2013 & 2013-2014 18

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4.0 INTERNAL & EXTERNAL ANALYSIS. 18

4.1 SWOT Analysis 18

4.1.1 Strength 18

4.1.2 Weaknesses 19

4.1.3 Opportunities 19

4.1.4 Threats 19

5.0 STRATEGY SELECTION. 20

5.1 BCG Based Strategy 20

5.2 Reason For Selection 20

6.0 SCORPIO TECHNIQUE 21

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 INTRODUCTION TO ANNAJ STORE
1.1 Name:

Annaj store.

1.2 Location:

The main store of Annaj store is situated on mall road Nowshera Cantt. The main item of Annaj
fruit farms is fresh honey, fresh vegetables, fresh fruits, fresh juices, fresh milk, fruit jams, wheat
flour, and fresh meats of different verity is the main product of Annaj fruit farms. Annaj sale
outlet is situated in army area on mall road Nowshera Cantt.

1.3 History:

Annaj store is opened in 2006 as a department store named as Xmart in Nowshera Cantt but with
the passage of time many others departments store opened in Nowshera Cantt. The competition
between them was so tough at that time because the nowhere Cantt is not big as other city then
after that they transformed themselves in Annaj store. Because they did research on this segment
and they know that our 60% customer are belong from army and they need fresh neat and clean
this type of product under one roof and then in 2008 they transformed them self in Annaj fruits
farms and now currently Annaj covered the full market in these products.

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1.4 Owner / Management/Hierarchy

OWNERS

PURCHASE CASHIER

MANAGER

Worker Worker Worker

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1.5 Competitors:

Zamzama store.

Annaj store.

Almadina store.

1.6 Operations:

Annaj operates in fresh products, The Annaj focused on fresh products actually on daily basis and
this is the competitive edge of Annaj and its normally focused on every level of customers. It
operate as a retailer business but to some extent it also deals in wholesale business for other retailer
shop but it not properly working in wholesale business. Mostly the owners purchase the products
from the NIFA and the meats they purchases from farms on daily basis with in Nowshera Cantt.
They purchased these product directly from farms houses. Their Products include Honey (sidder
honey, acacia honey, grinda honey), Fresh seasonal vegetables and fruits (seasonal fruits James,
juices, drinks, squashes, fruit candies, pickles etc. herbal tea, fish feed, highly egg producing desi
chicks.

The Annaj operation are operate by owners. Actually it is one family business. The whole business
operation are look after by two brothers. One brother performed the duty of cashier and other
brother handle the purchasing. Beside this they also hired three salesman for dealing the customers.

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 ENVIROMENTAL ANALYSIS
2.1 PEST ANALYSIS:

PEST Analysis is the analysis of the external environment of a firm. P.E.S.T is acronym of the
factors which are:

1. Political.
2. Economic.
3. Social.
4. Technological.

The PEST Analysis of Annaj fruit farms is as follow:

2.1.1 Political Factors:

These factors are as follows:

Personal Income tax: The Personal Income Tax Rate in Pakistan stands at 20 percent.
Personal Income Tax Rate in Pakistan averaged 21.00 percent from 2006 until 2015,
reaching an all-time high of 30.00 percent in 2006 and a record low of 20.00 percent in
2007. The trends show that it will remain same in the future.

Forecast. It will remain same in upcoming years

years Income tax

rate
2012 20%
2013 20%
2014 20%
2015 20%
2016 20%

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 Sales Tax: Sales tax is directly affects the prices of the products. Increase in sales tax
increases price and vice versa. In the past few years the sales tax is increased by the
Government from 15% to 16% and now it is 17%. By seeing this trend we can say, in the
upcoming years the sales tax will increase more. The sales tax will affect the prices of
company accordingly.

Forecast. It will be increased in coming years.

years Sales tax rate

2012 16%

2013 16%

2014 17%

2015 17%

2016 17%

Law and Order: Law and orders situation can be measured through the crime rate in that
country. Law and order situation not satisfactory to attract the investors in Pakistan. There
are any crimes happing in Pakistan like theft, violence, disturbance of peace, political
parties strikes, bomb blasting and terrorism are the main reasons for investors that prevent
them to invest in Pakistan. The law and order situation of KPK is improving day by day in
this government. Specifically in area of Nowshera Cantt its good. In the past we faced
problem in Nowshera Cantt like Xmart or army mosque blast and sit-in by some political
parties. Currently the law and order situation of Nowshera is very good. So by seeing this
we can say that in the future the KPK law and order will improve. Annaj have faced some
problems during sit-in. After that sit-in Annaj have not faced any problem so in future it
will improve more.

Forecast. It will improved more in coming years

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 Stability of Government: If we analysis the political conditions of Pakistan from last 10
years we will find that there is politically stability because the last government complete
his 5 years time. Now this government is also going smoothly to complete its time. It is
forecasted that in future in Pakistan the political stability will remain the same. In Pakistan
the eras of dictatorship and democracy have seen. In past few years the Government is
ruled by democracy and Government is stable. Another factor in the stability is the impacts
of other political parties actions. In era of this Government we have seen sit-in but now
situation is changed. It can be forecasted that the situation remains stable in upcoming days.

Forecast. It will remain stable in coming years.

2.1.2 Economic Factors:

Economic factors are:

Inflation Rate: Consumer prices in Pakistan rose 3.81 percent year-on-year in November
of 2016, compared to a 4.21 percent increase in October, mainly driven by food prices. It
was the lowest inflation rate since August 2016. On monthly basis consumer price rose
0.21 percent. Inflation Rate in Pakistan averaged 7.86 percent from 1957 until 2016,
reaching an all-time high of 37.81 percent in December of 1973 and a record low of -10.32
percent in February of 1959. And the trends show that inflation rate will decrease in future.

Forecast. It will decreased in the upcoming years.

years Inflation rate

2012 10%
2013 8%
2014 8%
2015 4%
2016 3.9%

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 GDP Growth: GDP represents the total dollar value of all goods and services produced
over a specific time period; you can think of it as the size of the economy. GDP of Pakistan
is growing from last few years currently it is 4.24%. The trend of GDP growth is on
increasing side. It is forecasted that GDP will remain increasing in coming years.

Forecast. The trend show that it will remain increased in future

Years Inflation rate

2012 3.84%

2013 3.65%

2014 4.03%

2015 4.24%

Unemployment rate: The number of unemployed people is increasing in Pakistan from

last few years. In 2011 the unemployed rate is 5.95 that jumped to 6.4 to 6.2 to 6.7 in year
2012, 2013, and 2014 respectively. This means the number of unemployed people is
increasing and it will follow the same trend.

Forecast. The trend show that it will be increased in future.

years Unemployment
rate

2012 6.1%

2013 6.5%

2014 6%

2015 6%

2016 5.9%

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2.1.3 Social Factors:
Social factor are:
Consumption Patterns: Pakistani are considered as high consumption oriented nation and
we are dealing in products which are daily needed so the consumption of these product
cannot be decrease. It is expected to be increase in future as Nowshera is a developing city
and population here increasing with the construction of new houses.

Forecast. This will be increases in the future.

Population growth: Pakistans population is increasing day by day. So this means that the
population of Islamabad is also increasing. In 2014 population of Nowshera Cantt is
estimated 1.5 million. It increased now definitely.

Forecast .This is on increasing side and it will increase in future as well.

years Population
growth rate

2012 1.69%

2013 1.65%

2014 2.1%

2015 2.01%

Gross Saving (% of GDP): In Pakistan the gross saving rates are, in 2011 it was 21, in
2012 it was 20, in 2013 it was 21 and in 2014 it was 24.76. It decreased in 2012 but again
it is on increasing side

years Gross saving%

2011 21
2012 20
2013 21
2014 24.76
2015 25

Forecast. It is forecasted that it will increase in future as well.

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2.1.4 Technological Factors:

Technological factors are:

Innovation in Technology: In Pakistan businesses improve their technology as any

innovation is made in it. This is a trend when businesses update its technology. So in past
it was seen that technology upgraded and in future it will happen again.

Forecast. It will be improve in future.

Research & Development: With the help of R & D businesses make changes accordingly
as required. With the help of technology these changes were made. The trend is by looking
the needs and wants of customers innovation made, this trend was followed in past and will
be followed in future. So research and development are still required in business.

Forecast. Trends show that it will remain same no any improvement in this area.

PERFORMANCE ANALYSIS
3.1 BCG Matrix:

The BCG before going to actual calculation of BCG, lets first explain about the company
relevant sales and comparison with its competitor in the market. I asked from the sales of the
store and its competitors. They told me not exact figures because they have no proper system to
for records. They calculate their records on the daily basis. They give my assumed figures of
their daily sales and I convert those into annually basis.

There are three main plyers those which I have calculated BCG Matrix .I have calculated the
relative market share and market share for the BCG purposes. The calculations are given below
in the form tables and graphs.

Matrix of Annaj along with its competitors is as follow:

Profits Per Year (In Millions)

Company Name
2013 2014 2015
Annaj store 25 29 35
Almadina store 20.5 24 28
Zamzama 21 24.5 29.5
Total 66.5 77.5 92.5

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The profits for the year 2013, 2014 & 2015 are assumed. On the basis of these figures Market
Growth and Relative Market Share is as follows

2013-2014 2014-2015
Market Growth RMS Market Growth RMS
16% 1.18 20% 1.18
17% 0.82 16.6% 0.93
17% 0.84 20.2% 0.92

Overall market growth and Average relative market growth

Year Overall Market growth Average Relative market
2014 16.5% .94
2015 18.7% 1.01

For year 2013-2014 overall Market Growth is 16.5% and ARMS is 0.94 and for year 2014-2015
Market Growth is 18% and ARMS is 0.97. It means the overall market growth is increased and as
well as average relative market share is also increased in 2014-2015. This increase is because of
the more consumption of products that why its increase because the demand of daily basis items
would be increases with the passage of time.

In BCG Matrix graph the following stores are represented by;

Zamzama is presented by
Z

Almadina store is presented by M

Annaj fruit farms is presented by A

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 BCG MATRIX
For Year 2013-2014

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BCG MATRIX
For Year 2014-2015

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3.2 Comparison of Year 2013-2014 & 2014-2015:

Almadina store. The Market Growth of Almadina is decreased to16.6% from 17%
but its ARMS are increased to .93 from .82. This increased in ARMS is because of
discounting to his customers in seasonal products like eggs fruits and honey chicken
and many more, so it resulted in increased in ARMS.
Annaj store. The Market Growth of Annaj store is increased to 20% from 16% and
its ARMS is remain same to 1.18 in both years. The market growth is increased but
ARMS is remained same
Zamzama store. The Market Growth of zamzama store is decreased to 7.7% from
14% and its ARMS is increased to 0.97 from 0.9. The ARMS is increased because
of some sale strategy they give one item free to his customer when his sale reached
to the 4000. That why his ARMS are increased.

INTERNAL & EXTERNAL ANALYSIS

4.1 SWOT ANALYSIS:

SOWT analysis includes Strength, Weaknesses, Opportunities and Threats of a company. The
analysis of our company is as follows;

4.1.1 Strengths:

Annaj fruit farms has following strengths:

Reduce Labor Cost: Annaj is working in that area where labor is easily available at a
normal rate. By hiring those people Annaj reduces its cost of production. Which helps in
low prices.
Research and Development: Annaj is operating with research base organization NIFA,
have laboratories and research facilities where they develop different products and enhance
quality which is an edge in the market place of Annaj over and others.
Future Profitability: On the basis of business growth of Annaj which is growing during
past 6to 7 years. We can predict that in future profitability will increases with same trend.
It makes an image over the competitors.
Guarantee Products: If any customer found any low quality product it will be replaced.
This is guarantee from Annaj because Annaj is charging price against quality. Annaj
offered this but Annaj have not faced this kind of situation.
Location: location is the strong strength of annaj store .it is situated in dense area and on
GT road. So customers can easily visit it even passengers also visit due to location.

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4.1.2 Weaknesses:

Weaknesses include:

No Advertisement:
Annaj is not using marketing for its store. The other two competitor are doing marketing
to some extent in the shape of billboards and banners. The other competitor do his
marketing through electronic media as well as they do different taste test from hi customers
to gain high market share.
Limited Shelf Life of Food Products: Annaj is not using any chemical and preservatives
in their product which increases product shelf life longer.
Limited Target Market: Target market of Annaj is limited because it currently has only
one outlets. This means the target market of Annaj is limited.
Small in size: Annaj covered area is so small in size so it should be focus on this side so it
is the weakness of Annaj.
No software: no software is used by annaj store for sale so it the month end that did not
know about sale actually.

4.1.3 Opportunities:

Opportunities for Annaj are:

Increasing Population: Population is increasing with the passage of time. A lot of housing
societies are going to develop near Annaj and surrounding. This will increase its revenue.
Dairy Sector: As the population is increasing, demand of dairy product is also increasing
and this is big opportunity for Annaj to invest and to increase their dairy production.
Stable government: government is now improving in nowshera that is the plus point of
all business and people invest their money in business
Inflation rate. Inflation rate is also on decreasing trend in Pakistan so the purchasing
power of customers will increases
Law and order: the law and order situation is also improved because of new and stable
government.

4.1.4 Threats:

Threats are:

Taxes: Whenever Government imposes taxes to the products, it will increase the prices of
products. This increase in prices can be a cause of low sales.
Law & Order: Situation of law and order is stable at this time but we cannot say that this
will remain stable because Pakistan fighting against terror.
Increase in Cost of Labor & Energy: Increase in the cost of labor and energy is a threat
which will effect on company. It results in increase in the prices of products.

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 Competitor:

Annaj have threat of entry of new competitor in the market. It has been observed that annaj has
not kept itself equal with the demand and supply of market. Anyone can see this difference and
can enter the market.

STRATEGY SELECTION
5.1 BCG Based Strategy:

BCG based strategy includes:

1. Build

2. Hold

3. Harvest

4. Divest.

For our company in the basis of analysis we have selected BUILD STRATEGY.

5.2 Reason for BUILD STRATEGY.

Annaj store need to use Build strategy. In first year they are in cash cows but in second year they
jump to the star quadrant. They already have higher market share as compared to its competitors.
Business need to generate more sales to improve its growth. They have strong financial resources
and they must need to invest in expansion of business. Their growth rate is slower in comparison
with competitors. They need to expand to increase their growth rate. Currently store industry is in
growth phase Kashmir. Business must need to capture other areas of city as well as other cities of
Kashmir. Business is already has expansion plans of opening branch in newly constructed satellite
town in the city. The business must invest in upgrading its operations to retain its share and
customers. The business is in good shape right now. All it needs it to advertise more and capture
more areas of city. They need to deal also in credit bases to generate more sales.

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 SCORPIO TECHNIQUES
SCORPIO Techniques of Annaj store are as follow:

Industry or Market: Annaj is customer oriented company. Annaj make changes

according to the requirement of customers. Annaj have full advantage in the Nowshera
cantt because in that area Annaj don't have any competitors. So, Annaj is focusing on its
customer needs and wants. Annaj is having indirect competitors in Nowshera city. With
this developed strategy Annaj will have same focus on its customers.
Customers: Annaj focused on all customers. Annaj have more actual customers then
others mall like Annaj and Potential customers of Annaj are converting into actual
customers because Annaj offers more quality product at a good cost. This is affordable by
middle and lower middle class of society. Build strategy helps Annaj to convert more
potential customers into actual customers.
Segmentation: Annaj currently is doing demographic segmentation because it is restricted
to only Nowshera cantt. On the other hand Annaj products prices are not too much high so
it is also targeting middle and lower middle class of society. After implementing build
strategy Annaj can target other areas as well to expand their business.
Offering: Annaj is offering fresh and good quality products to its customers. Annaj is now
starting promotion doing promotions via stalls in different food programs. Actually Annaj
is the first store in Nowshera cantt who gives fresh food items under one roof to his
customers. In order to develop offering customers needs are taken in to account through
research. After implementing build strategy Annaj can work more on research and can offer
products according to demands of customers.
Positioning: Annaj have positioned itself in mind of customers in such a way that it has
provided fresh and good quality products and services. If anyone found any low quality
product it can be replaced. With the help of build strategy Annaj can make its image
stronger in the mind of customers by offering some additional benefits and some discounts.
Retention: By giving value to both actual and potential customers Annaj can retain its
customers. Special discount or packages can be offered to old customers to keep their
loyalty. By build strategy implementation in the new areas Annaj should use techniques
to retain their customers.
Organization Culture & Processes: Annaj should not change its culture and processes
after implementing the build strategy.

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