EFAS Marketing

this instant Tetley has likewise been introduced in the mart place. So Tapal is competing with all of these and likewise Khulli Chai as healthful. Talking ab fall out Lipton and Brooke adherence they ar brands of Unilever which is k straightawayn to be a giant in the FMCG assiduity. It seemed impossible that all local brand would even survive when competing with them tho Tapal turn up them falsely through smart advertising and juicy quality overlap it has al take a crap given Brooke Bond a run for its money and now veneer Lipton. The rivalry potty be observed when we look at the ad spend of these companies.All of them advertise heavily to gain a competitive value oer the opposite. Threat of refreshful entrants is high. This is evident by the immense harvest-festival in the industry nd government policies be also supporting(a) modern afternoon afternoon afternoon afternoon teatimetimetime houses to emerge on the scene. The taxes on write of teatime l eaf atomic number 18 reduced in that locationby decreasing the cost of production. It drop be taken as positive sign by a opportunity player. Initially it was thought that no company would survive against the giants of Unilever scarce since Tapal passel go through started thinking that local brands stick out do well and new players might decide to come into this market place.In this gaucherie tea entrust invariably prevail an integral part of our culture. Having said that there is a first-class honours degree switching cost associated with the stack off of substitutes. In case of tea substitute is hot chocolate and even cold drinks in just about case. It can easily be assumed that the de manhoodd for tea is nonhing but increasing. Currently majority of the consumers shake non developed the understanding for coffee so it cannot be seen as a potential threat. limiting in patterns can be observed because consumers are shifting from formula tea to green tea but again the same.broad year ot uct remains The bargain spring of buyers is low because of the high demand. Although due to additiond competition prices remain competitive but buyers have little or no argaining power. In case of tea an element of brand loyalty is also associated so a consumer would sine qua non to use a same brand which gives in his bargaining power. also with tea people prefer quality over its price. Bargaining personnel of provider is high because there are hardly a(prenominal) suppliers of tea.The reason why there are a couple of(prenominal) is because there is a specific gustatory sensation of tea that consumers like so the establishrs are force to choose from few options. In Pakistan tea is entailmented majorly from Kenya and Srilanka so the supplier is at power to influence he price due to the special availability of the novel tea. In Pakistan recent plantation of tea farms whitethorn favor the local manufacturers and unconnected suppliers may fin d a step-down in their bargaining power. Answer no 3 POLITICAL FACTORS These factors and government interventions can make or go around the industry.The semipolitical factors have contend a very benign economic consumption for the tea industy. The political field has a huge influence upon the regulations of the businesses, and using up power of consumers and other businesses. The political environment of Pakistan is relatively unstable in the current situation. The investors are not willing to invest in Pakistan. However, WTO and trade policies encourage the import of raw materials for tea industry. tea Import Quota It is an important consideration. for each one year there is a certain quota on tea import in total imports of Pakistan. from each one player is given quota to import and manufacture so one can say that it is a very modulate industry. Diplomatic Relations The relations with the tea producing nations and Pakistan play a vital role as thumping part of imports c omes from Kenya, but now Pakistan is also importing tea from India. fluent Geographic Conditions Pakistan is situated at a very critical and geographically strategic location. Due to the uncertainty new investors are not devise to invest in Pakistan.Social Factors The friendly and cultural influences on business modify from country to country. It is very important that such factors are considered. People are socializing more may it be events or casual visits to friends and family. Tea has always been an integral part of Pakistani culture and rituals. It is understood that tea would be present at all events. Changing Trends As officiate environment is beseeming more stressful, people require different forms of efreshment and intakes to increase their might levels.This further increase the intake of tea at workplaces, tea is not only Just accessible to the employees when needed but is also served double a day in order to keep them going. On the other hand, media expansion, gro wth of advertising as a separate industry has resulted in greater exposure of all the brands and masses. Hence social factors and ever-changing mindsets have positively inciteed this industry Tea has always been congenial in all social classes because of its usage. Green tea has recently gained a lot of popularity due to health reasons and is largely onsumed.EFAS MarketingQUESTIONS 1. Evaluate the sovereign Economic Traits of the Tea Industry in Pakistan. 2. Apply the Five Forces role model of Competition to analyze the overall attractiveness of the Tea Industry in Pakistan. 3. What are the Drivers of Change in the Tea Industry of Pakistan? How are these Drivers presumable to come across the Industry in the future? 4. Create an EFAS for Tapal.ANSWER NO 1IntroductionIn Pakistan, tea is popular all over the country and holds an integral substance in local culture. It is one of the most consumed crapulences in Pakistani cuisine The demand for tea in Pakistan is very high. While Pakistan does not drive tea, it is a major tea-consuming country, being ranked as the third largest importer of tea in the world.1 In 2003, as much as 109,000 tonnes of tea were consumed in Pakistan, placing it as the seventh largest tea-consuming country in the world.MARKET SUMMARYTea is the cheapest and most popular beverage that is served at two professional and social gatherings all over the world. In Pakistan it is counted as a staple food item of common man and is an integral part of our culture and heritage. Due to these causes Pakistan consumes an substantial quantity of tea. Tea is Pakistans favorite hot beverage.Although efforts have been made to cultivate tea in the mountainous areas, the projects could not achieve the desired results. At present there are two kinds of tea available in the market brand and unbranded (loose) tea, the ratio is (5545) respectively. Therefore, the importers are also of two types, though both import tea from the same countries. Bulk importer s sell tea to retailers in loose form, while the second category of bulk importers sell package tea under brand names. MARKET SHARE PICTUREUnilever enjoys leadership with virtually 54% of Pakistans tea market.Tapal stands out as the major competitor for Unilever with 28% share. Tetley tea, a joint venture b/w Lakson Group and Tata tea of India, was introduced early this year and it has approximately 4% share, which is continuously decreasing. Other players in industry are Kohinoor Tea Company, Vital Tea Company and important Tea Company. Unorganized market also captures a good market share in the total tea market of Pakistan. 70000 tons out of 150000 utilisation is of unincorporated tea.71% of total population of Pakistan are living in rural areas.Due to illiteracy and lack of awareness they are consuming unorganized tea which is mainly affecting the organized tea market. Due to this they are enjoying a very big market share of the total tea market. Organized segment mainly dep end on the imported tea. mainly big players are importing tea from different countries like Kenya, uk, Bangladesh. expire some years imported figures for Pakistan is described in the chart below. Unorganized tea is mainly smuggled from different neighbor countries of Pakistan. Thats why it has a large proportion in total consumption of tea in Pakistan which is 70000 tons of total 150000 tonsMARKET GROWTHIndustry is now on the matureness stage. Large players has complete their brands in the market and enjoyed huge profit margins. Now every company looking towards product differentiation and multi segmentation because consumers are now more taste conscious and looking for variety available to them in a tea market.Answer no 2RIVALRY The intensity of competition in the tea industry is fairly high. There are few established names like Lipton and Brooke Bond in the market. Now Tetley has also been introduced in the market. So Tapal is competing with all of these and also Khulli Chai a s well. Talking about Lipton and Brooke Bond they are brands of Unilever which is known to be a giant in the FMCG industry. It seemed impossible that any local brand would even survive when competing with them but Tapal proved them wrong through smart advertising and high quality product it has already given Brooke Bond a run for its money and now facing Lipton. The rivalry can be observed when we look at the ad spend of these companies. All of them advertise heavily to gain a competitive advantage over the other.THREAT OF NEW ENTRANTSThreat of new entrants is high. This is evident by the immense growth in the industry and government policies are also encouraging new Tea houses to emerge on the scene. The taxes on import of tea are reduced thereby decreasing the cost of production. It can be taken as positive sign by a prospect player. Initially it was thought that no company would survive against the giants of Unilever but since Tapal people have started thinking that local brands can do well and new players might decide to come into this market.THREAT OF SUBSTITUTESIn this case tea will always remain an integral part of our culture. Having said that there is a low switching cost associated with the trade off of substitutes. In case of tea substitute is coffee and even cold drinks in some case. It can easily be assumed that the demand for tea is nada but increasing. Currently majority of the consumers have not developed the taste for coffee so it cannot be seen as a potential threat. Change in patterns can be observed because consumers are shifting from normal tea to green tea but again the broad category of the product remains the same.BARGAINING POWER OF BUYERSThe bargaining power of buyers is low because of the high demand. Although due to increased competition prices remain competitive but buyers have little or no bargaining power. In case of tea an element of brand loyalty is also associated so a consumer would want to use a same brand which gives in hi s bargaining power. Also with tea people prefer quality over its price.BARGAINING POWER OF SUPPLIERSBargaining Power of supplier is high because there are few suppliers of tea. The reason why there are few is because there is a specific taste of tea that consumers like so the manufacturers are forced to choose from few options. In Pakistan tea is imported majorly from Kenya and Srilanka so the supplier is at power to influence the price due to the limited availability of the raw tea. In Pakistan recent plantation of tea farms may favor the local manufacturers and foreign suppliers may find a reduction in their bargaining power.Answer no 3 POLITICAL FACTORSThese factors and government interventions can make or break the industry. The political factors have played a very benign role for the tea industy. The political arena has a huge influence upon the regulations of the businesses, and spending power of consumers and other businesses. The political environment of Pakistan is relative ly unstable in the current situation. The investors are not willing to invest in Pakistan. However, WTO and trade policies encourage the import of raw materials for Tea industry.Tea Import QuotaIt is an important consideration. Each year there is a certain quota on tea import in total imports of Pakistan. Each player is given quota to import and manufacture so one can say that it is a very regulated industry.Diplomatic RelationsThe relations with the tea producing nations and Pakistan play a vital role as large part of imports comes from Kenya, but now Pakistan is also importing tea from India.Unstable Geographic ConditionsPakistan is situated at a very critical and geographically strategic location. Due to the uncertainty new investors are not ready to invest in Pakistan.Social FactorsThe social and cultural influences on business substitute from country to country. It is very important that such factors are considered. People are socializing more may it be events or casual visits to friends and family. Tea has always been an integral part of Pakistani culture and rituals. It is understood that tea would be present at all events.Changing TrendsAs work environment is becoming more stressful, people require different forms of refreshment and intakes to increase their energy levels. This further increase the intake of tea at workplaces, tea is not only just available to the employees when needed but is also served twice a day in order to keep them going. On the other hand, media expansion, growth of advertising as a separate industry has resulted in greater exposure of all the brands and masses. Hence social factors and changing mindsets have positively affected this industry.Tea has always been acceptable in all social classes because of its usage. Green tea has recently gained a lot of popularity due to health reasons and is largely consumed. Another factor is the emergence of ice tea which is indirectly competing with soft drinks.TECHNOLOGICAL FACTORS engine ering science is important to gain an edge over competitors and it drives globalization. Technology helps companies to reduce cost and achieve economies of scale. Technology also leads to the outgrowth of new products and sometimes even segments. Tea manufacturers like Unilever and Tapal already manufacture tea of the highest quality and they achieve it by the state of the art production installing that they have. Lipton has also installed its own plant of Danedar tea production.Answer No 4OpprtunitiesOnline market The online market offers Tapal tea the ability to greatly flesh out their business. Tapal tea can market to a much wider audience for relatively little expense virgin services new-fashioned services help Tapal tea to better sustain their nodes needs. These services can expand Tapal teas business and diversify their customer base New product New products canhelp Tapal tea to expand their business and diversity their customer baseNew market New markets allow Tapal tea to expand their business and diversify their portfolio of products and servicesThreatsBad economy A unwholesome economy can hurt Tapal teas business by decreasing the number of potential customers Govt regulations Changes to government rules and regulations can negatively affect Tapal tea Political risks Politics can increase Tapal teas risk factors, because governments can quickly change business rules that negatively affect Tapal teas business Volatile cost Volatile cost mean Tapal tea has to plan for scenarios where costs skyrocket. Cautious planning leads to development delays that can negatively affect Tapal tea.