Competitive Strategy

Competitive strategy is where you cater customer needs by offering them products and services to get
competitive advantage against its competitors. Shan has basically set a price that is reasonable as well
as affordable but with price there is quality. Quality of Ghee is extremely good according with the price
so it adds product value. At a commercial level it caters to small hotels and restaurants as these
restaurants use Shan Ghee and Oil for their food making it well known. Shan does not have direct
competitors in Lahore and only operates in this city. Regionally Shan takes over the competition in
Lahore and it makes quite good sales gaining an advantage in remaining efficient in terms of quality and
price.

Supply Chain Design and Strategic Fit

Supply Chain Designing basically involves the decisions about the structure of the supply chain and the
processes involved in each stage such as inventory, facilities, information system and modes of
transportation. Shan has a factory built in Kot Lakhpat and distributors supplying the product are part of
Supply Chain Design. Strategic Fit involves consistency between customer priorities of competitive
strategy and supply chain capabilities specified by the supply chain strategy.

Understanding the customer and supply chain uncertainty

Customer segment of Shan Ghee includes those who look for better quality and a reasonable price
compared to other leading brands. Therefore Shan meets that criterion. Demands of customer will vary
according to the following factors:

Quantity of Product needed in each lot: Shan Ghee has latest machinery to meet daily demands of
customers with total installed capacity of unit is 150 M tons per day and production of our unit is 100M
tons per day.

Response time that customers are willing to tolerate: Relationship with distributors is good as
whenever distributor needs it they tell beforehand before sending oil and ghee to them. Extra percent is
product to battle shortage to meet demands of customers. Distributors at times might not have trucks
to deliver but Shan does send trucks to the distributors. Response time is good. Product is available
when needed by customers that will increase consumer satisfaction as well as further improving
relationships. Nowadays many customers expect a very good response time from all types of business.
In this case Shan is doing very well these days.

Variety of poducts needed: Shan offers single type of ghee and oil to customers in different sizes.
Customers can choose the size of their ghee or oil in different packages (Tin,bottle,pouch and carton)
which would suit their requirements. Therefore it will be very economical for those people who need oil
and ghee in different sizes that is according to their usage.

Service level required: There will be no service level as customers will purchase the product directly
from the retailers. Retailers and Distributors are direct customers also expect the quantity required as
much as they need and get the product on the right time. Shan Ghee is very prominent on these 2 key
factors. They have good relationship with direct customers. If there is a problem in price or there is a
delay. Shan Ghee will provide it after few days therefore

Price of the product: Here customers would be looking for reasonable prices. Shan Ghee and Oil are of
affordable prices which caters lower and middle class people.

Implied Demand Uncertainty: It is always required when needed due to good relationship; they can
provide oil and ghee when required.