Term Paper for

Course Name: Brand Management

Course Code: 425

Submitted to:Muhammad Ismail HossainAssociate ProfessorDepartment of MarketingFaculty of Business StudiesUniversity of Dhaka

Submitted by:Group- Sparkling Stars Batch: B.B.A (18th), Section- ADept. of Marketing, University of Dhaka

SL NO. NAME ROLL NO.

1. Farhana Tarannum Tania 512. Md. Kalam Hossain 733. AntuAich 874. Md. Abu Sufian 935. Md. Al-amin 976. Md. Khairul Islam 1037. Md. MobarakHossain 1538. Md. AlamgirHossain 1919. Nadia Nasrin 20510. FahmidaAkterShahela 207

Date of Submission:26th November, 2015

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LETTER OF TRANSMITTAL

15th November, 2015

Muhammad Ismail HossainAssociate ProfessorDepartment of MarketingFaculty of Business StudiesUniversity of Dhaka

Subject: Submission of Term paper.

Dear Sir,

It is great to submit the report on” Brand Management, course no- 425 “as a BBA program. We

are to state that we are very much pleased to submit our report which is a part of our course.

We enjoyed preparing the report, which enriched our practical knowledge of theoretical

concept regarding Brand Management. I am very much glad that you have given us the

opportunity to prepare this report to you and hope that this report will help us to standardize

your judgment.

We apologize for any unified mistake found in writing or structuring this report. We are

confident that your advice clarifying any mistakes. We will always accept your suggestion

pleasantly.

Yours sincerely

Group- Sparkling Stars

Section – A, 18th Batch, BBA

Department of Marketing

University of Dhaka

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ACKNOWLEDGEMENT

All glory and honor is for Allah, the Supreme Being who bestowed profound perseverance and ability on us to accomplish this work.

We express our profound and cordial gratitude to offer thanks to our learned, kind and experienced teacher, Muhammad Ismail Hossain, Associate Professor, Department of Marketing, University of Dhaka for his valuable guidance constructive comments and continuous encouragement throughoutassignment.

We also wish to give thanks to those parsons who encourages and co-operate with us in preparing the business plan.

Yours SincerelyGroup- Sparkling Stars18th Batch, BBADepartment of MarketingFaculty of Business StudiesUniversity of Dhaka

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EXECUTIVE SUMMARY

The report is as a requirement of BBA program of the Department of Marketing. The total report is divided into 4 parts. The first part includes the product/brand mix depth, width, length and consistency of PRAN-RFL Group, Square group, Reckitt Benckiser and Caterpillar Inc.

In the 2nd part of the report we have discussed the reasoning of diversification undertaken by the 3 companies.

In the 3rd part we have found the reasoning of diversification of PRAN RFL Group- perceived and given by the stakeholders (e.g. customers, suppliers, dealers, distributors, retailers) other than the company itself.

And in the last part we have made an overall assessment of PRAN RFL against the chosen 3 companies.

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Table of Contents

EXECUTIVE SUMMARY....................................................................................................................................... IVMETHODOLOGY.................................................................................................................................................. 1LIMITATIONS...................................................................................................................................................... 1CATERPILLAR INC................................................................................................................................................ 2PRODUCT MIX OF CATERPILLAR INC.:.................................................................................................................. 2

PRODUCT MIX WIDTH:.................................................................................................................................................2PRODUCT MIX LENGTH:................................................................................................................................................2PRODUCT MIX DEPTH:..................................................................................................................................................2PRODUCT MIX CONSISTENCY:.........................................................................................................................................2

REASON OF DIVERSIFICATION OF CATERPILLAR INC.:...........................................................................................3HERITAGE OF INNOVATION:............................................................................................................................................3TO SUSTAIN AND LEAD IN THIS COMPETITIVE MARKETPLACE AGAINST COMPETITORS:................................................................3CREATING VALUE FOR CUSTOMERS:..................................................................................................................................3CREATING SOLUTION FOR CUSTOMER’S PROBLEM:..............................................................................................................4MEETING THE DEMAND OF DIVERSIFIED MARKET:...............................................................................................................4

PRAN-RFL GROUP............................................................................................................................................... 4PRODUCT MIX..................................................................................................................................................... 5

PRODUCT LINE.............................................................................................................................................................5PRODUCT LINE LENGTH.................................................................................................................................................5PRODUCT LINE DEPTH...................................................................................................................................................5PRODUCT MIX WIDTH..................................................................................................................................................5REASONING OF DIVERSIFICATION OF PRAN-RFL................................................................................................................6

RECKITT BENCKISER (RB)..................................................................................................................................... 7INNOVATION AT RB AS A DRIVE FOR DIVERSIFICATION.........................................................................................................8

SQUARE GROUP.................................................................................................................................................. 9PRODUCT MIX OF SQUARE GROUP:..................................................................................................................... 9

PRODUCT MIX WIDTH:.................................................................................................................................................9PRODUCT MIX LENGTH:................................................................................................................................................9PRODUCT MIX DEPTH:..................................................................................................................................................9PRODUCT MIX CONSISTENCY:.........................................................................................................................................9

REASONS FOR DIVERSIFICATION:....................................................................................................................... 10THE OVERALL ASSESSMENT OF PRAN RFL AGAINST CATERPILLAR INC., RECKITT BENCKISER AND SQUARE LTD.. .11OUR CONCLUSION ABOUT THE OVERALL ASSESSMENT OF PRAN RFL AGAINST CATERPILLAR INC. IS GIVEN........11

ASSESSMENT ON MARKETING MIX ACTIVITIES:..................................................................................................................11EXTERNAL ENVIRONMENT ASSESSMENT (PORTER’S FIVE FORCES COMPETITIVE ANALYSIS):......................................................12SWOT ANALYSIS (THAKRAL, 2015):.............................................................................................................................13RECOMMENDATIONS:..................................................................................................................................................14FOR CATERPILLAR:......................................................................................................................................................15

CONCLUSION.................................................................................................................................................... 16WORKS CITED................................................................................................................................................... 17

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MethodologyThe study is descriptive in nature. Data used in this study are basically from secondary sources.

Primary data cannot be collected because of many constraints. Secondary data derive from

various sources including different websites. There are also some parts that have been derived

from others study of the persons who are in the real field.

LimitationsCollecting data was difficult as a lot of journals, periodicals and published data on this issue are

not available. We put all efforts to collect necessary data through resource and budgetary

constraint. Moreover, Interviewing target respondents were difficult as they were inaccessible

or not available. Officials were found too busy and also reluctant to talk without a proper

written permission from the competent authority. Moreover, while collecting data they did not

disclose much information/data due to the secrecy of the organization.

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Caterpillar Inc.Caterpillar Inc. is an American corporation which designs, manufactures, markets and sells machinery, engines, financial products and insurance to customers via a worldwide dealer network. Caterpillar is the world's leading manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives. CAT provides a product line that effectively caters the different needs of its customers and also in order to sustain in the competitive farm and construction machinery industry against other companies such Komatsu Ltd and Deere & Company.

Product Mix of Caterpillar Inc.:A product mix is the set of all products and items a particular seller offers for sale. The product mix of Caterpillar Inc. consists of various product lines such as- Equipment, Power Systems, and Attachment etc. A company’s product mix has a certain width, length, depth and consistency. These terms are illustrated in case of Caterpillar Inc. in the following description-

Product Mix Width:The width of product mix is the number of product lines in the product mix. In case of Caterpillar Inc. Product Mix Width consist of its five product lines such as- Equipment, Power Systems, Attachment, Technology, and Financing & Insurance.

Product Mix Length:The Length of Product Mix refers to the total number of items in the mix. In case of Caterpillar Inc. Product Mix Length consist of its (37+4+45+2+2=90) total Ninety products.

Product Mix Depth:The Depth of Product Mix refers to how many variants are offered of each product in the line. In case of Caterpillar Inc., one item/product of Power System, Electric Power Generation has seven variants. So the depth of Electric Power Generation is Seven. We can calculate the average depth of Caterpillar Inc. by averaging the number of variants within each product in the product line.

Product Mix Consistency:The consistency of the product mix describes how closely related the various product lines are in the end use, production requirements, distribution channels, or some other way. The various product lines of Caterpillar Inc. are consistentin that they are mainly construction and mining equipment and technology needed for the effective performance of those equipment and

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financial products for the smooth purchase of its products. Its products lines are less consistentin the functions they perform for different customers (mining versus building bridge). The various product lines of Caterpillar Inc. are consistent in case of production requirement because raw materials, processes and man power needed for the production of its products are quitesimilar. In case of distribution channels, Caterpillar’s various products lines are also consistent because products are distributed to end-users in nearly 200 countries through their worldwide network of 220 dealers.

Reason of diversification of Caterpillar Inc.:Caterpillar Inc. was formed in 1925 in California after a merger between Holt Caterpillar Company and C.L. Best Gas Tractor Company (Caterpillar Inc., 2015). From inception, Caterpillar is striving towards creating value for customer and finding solution for customer problems. In this process Caterpillar does not rely much on product development as an intensive strategy for growth. The company mainly focuses on improving existing products. The firm rarely introduces an entirely new product. Instead, existing Caterpillar products are modified to provide new features and improve customer value (THOMPSON, 2015). At present, Caterpillar serves customers in more than 180 countries around the globe with more than 300 products(caterpillar.com, 2015).Reason of such diversification of Caterpillar can be found by analyzing Caterpillar´s vision, strategy, goal, norm, value, belief and corporate culture. The reasons are described in the followings-

Heritage of innovation:Caterpillar’s vision for innovation started in California when it was formed in 1925 – long before Silicon Valley became the technology hub it is today. Its pioneering spirit is the driving force that moves the employees in Caterpillar forward and motivates them in continuous innovation. Through innovation theybring in new or different product, process or production methodology to their work and find a way to commercialize it in a way in which it delivers value for the customers. They consider innovation as race between life and death because of their learning from Companies like Kodak, Blockbuster and Nokia who failed as they did not keep pace with the progressive world(www.caterpillar.com, 2015)

To sustain and lead in this competitive Marketplace against competitors:Caterpillar Inc. believes that to sustain and lead in this competitive Marketplace against competitors, they need to anticipate the need of customer, the problem the customers are facing, what their latent demands are, long before the competitors. For this reason they launch product within short term interval.

Creating value for customers:Caterpillar Inc. works to create value for the customer so that they can do their job effectively and efficiently. They are determined to provide necessary help (i.e. Providing training to handle their equipment, providing insurance and financial service etc.)to their customer. The following

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message of the CEO Doug Oberhelman of Caterpillar Inc. describes, how they focus on creating value for customer (caterpillar.com, 2015).

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Creating solution for customer’s problem:At present Caterpillar Inc. can boast for having more than 300 products that they launched for solving customers problem.

Meeting the demand of diversified market:Caterpillar Inc. is careful about the difference/variation of customer need around the world. They don’t do the same thing for each market. They launch product based on their customer needs. What delights a customer in Panama is not the same thing that delights a customer in Venezuela and certainly not in the U.S.” (caterpillar.com, 2015)

PRAN-RFL GROUPPRAN stands for Program for Rural Advancement Nationally. RFL Stands for Rangpur Foundry Limited (It is a water pump and plastic pipe industry).PRAN-RFL GROUP was born in 1980. In 1981 they were merged and started their group named PRAN-RFL Group. Keeping in view the corporate mission of the group they have over the years diversified their activities. Today they are the largest processors of fruits & vegetables in Bangladesh. They encourage contract farmers and help them grow quality crops with increased yields and to obtain fair prices. The Group comprises of 10 companies. The head offices are located at Dhaka with production facilities around the country. Their management is modern adapted to our environment & culture. Their largest asset is their competent team of hands-on-mangers & dedicated employees (Imam, Ifti, & Sakif, 2014).

PRAN-RFLis continuously making critical decisions about their product range. Product decisions will include whether to develop new products and how to manage existing products. The following is short sketch about the different ways they manage the type and number of products they sell and related terms.

Product MixThe Product mix is the total variety of products a firm sells. Some firms will sell just one product, whilst others will sell a large number of different products. For example Pran-RFL has different product mix like Pran foods, Plastics, Agriculture, Buildings Materials etc. Firms should select their product mix carefully as they will need to generate a profit from each of the products in the product mix.

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Product LineA product line is a number of products grouped together based on similar characteristics. The characteristic used to split products, will depend on the firm and its product strategy. They include product price, product quality, who the product is aimed at (target group), and product specification/features. For example-Pran foods are divided into drinks, biscuits, Jam & Jelly, snacks, Dairy Derivatives etc. Product lines help firms manage their products as product strategy can be designed around product lines. This is useful if the firm has a large product mix as there is less need to concentrate on individual product type strategy.

Product Line LengthThe product line length shows the number of different products in a product line. A long product line has lots of different products in it and a short product line has a small number of different products. The product manager's job is to work out how many products to include in the product line. For example, within product line of soft drinks Pran foods has Mango, PRAN up, Orange, Energy Drinks, and Drinking Water.If there are too many product types in a product line, they will begin to compete with each other, increase costs unnecessarily and even confuse customers. If the product line is too short it will limit customer choice and send customers to competitors with a greater selection of products.

Product Line DepthSome of the product types in a product line may be split again into groups; the product line depth shows how many subgroups the product line contains. For example, under the line of Juices and Drinks Pran foods have Mango, Apple, Pineapple, and Orange.

Product Mix WidthThe product mix width is the number of product lines in the product mix. A wide product mix increases the type of customers a firm can target.But a narrow product mix is easier to manage and allow the firm to specialize in particular product lines and product types. However a small product mix reduces the type of customers a firm can target as they can't cater for everyone's product "needs and wants".

Reasoning of diversification of PRAN-RFLPRAN-RFL works to generate employment and earn dignity and self-respect for competitors

through profitable enterprises.

Customers Perspective

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PRAN-RFL as a top of mind awareness has grasped the every sector of customers´ need with the

continuous diversification of product both in terms of consumer as well as business goods. As

the customers of PRAN-RFL they perceive that PRAN-RFL has diversified its production and

distribution to serve their need best in every corner of the world. Some of the specific factors

that customers think as a diversification initiatives are technological impact, standard of living,

social media effect, increasing demand of consumers.

RetailersPerspective

What PRAN-RFL produces goes sell in the market that is the main reason of diversification as

their retailers perceive. Retailers themselves try to brand their own stores through the products

they offer for the consumers. For this they try to make product available according the their

local customers need. They more they can serve their customers need they more they can earn

margins by selling large in quantity. So, retailers patronize the company and distributors whose

products serves as an anchor of their stores. They can sell any product of PRAN-RFL that they

store in their shop.

Dealers and Distributors Perspective

Dealers as well as distributors see PRAN-RFL as a blooming global company in the business

world. They think that PRAN-RFL has the capacity to produce as well as distribute worldwide

which gets sync with many of the dealers and distributors mission of being worldwide

distributor as a successful partner of the company. They see PRAN-RFL working with the aim to

cover both FMCG and FMCD markets.

Perceived Reasons of Diversification

PRAN FOODS - Ours is an economy of agriculture and PRAN´s target is to develop our

agriculture sector in fullest sense. They are trying to create more demand for agro product,

produced by our farmers with the target is to make their product available to every corner of

our country so that every customer get the right to consume.

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RFL - RFL started its journey with Cast Iron (CI) products in 1980. The initial main objective was

to ensure pure drinking water and affordable irrigation instruments for improved rural life.

Today the company has its wide ranges of CI products like pumps, tube wells, bearings, gas

stoves etc. and has achieved the prestige as the largest cast iron foundry and light engineering

workshop in Bangladesh. With a vision to serve the common people of Bangladesh with quality

necessity products, RFL diversified its operation into PVC category in 1996 & in Plastic Sector in

2003. At present it is market leader in all these three sectors-Cast Iron, PVC & Plastic in the

country. Sizable amount is also exported to different countries.

Reckitt Benckiser (RB)Reckitt Benckiser (RB) is the world's leading consumer health and hygiene company, with brands sold in nearly 200 countries and operations in over 150 years of innovation for consumers across the world. German and British heritage, it organizes the majority of its products into three main categories-health’s, hygiene and home-with other brands belonging to three further categories: food, pharmaceuticals and portfolio brands. The company's strategy is to have a highly focused portfolio concentrating on its 19 most profitable brands, which are responsible for 70% of net revenues.Their vision is a world where people are healthier and live better.Reckitt Benckiser’s purpose is to make a difference by giving people innovative solutions for healthier lives and happier homes. This means they are expanding their capabilities and investing in innovation to stay ahead of the game.They position around health, hygiene and food which is the core of their passion to grow worldwide.

Consumers’ health inspires them to innovate. They believe that feeling well is at the heart of their rapidly growing consumer health business. They take making a difference to the lives of consumers as expanding their research and innovation to stay ahead of the business. They are in fact changing the play in consumers’ health.They have strong commitment to producing top quality, trusted medicines and medical devices with a fast-paced, entrepreneurial and rigorous workplace. They are constantly evolving their global portfolio with a purpose, supported by relevant medical facts and scientific based evidence.

They consider hygiene as the foundation of healthy living. Actually, people are living longer than ever before due to better health and hygiene. Their 2015 target, to achieve 72% of the core net revenue from health and hygiene, was achieved two years early as they continue to develop new and effective solutions to help improve standards of hygiene worldwide.

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They also see the home as the center of family life and so this is at the center of their vision for healthier lives and happier homes.

They can understand that consumers not only want practical solutions for keeping their homes clean and fresh, but also those extra little things that make their homes of their own.They do this not only through developing exciting new products but through helping consumers to get the best of their products.

Innovation at RB as a drive for Diversification

RB is a true leader, in market terms and financially. Its strategy is simple: Power brands driven by innovation, rolled out globally & heavily marketed. Innovation is the main drive behind their brand and product extension decisions. RB is a genuinely global force and a truly multinational company.

RB reinforces its brands with an exceptional rate of innovation. Their Innovation drives their strategy. They believe that innovations must be great in performers, fast to the market and cost-effective also. Their innovation pipeline is built around brand strategy. So innovative cost savings improve margins and fuel growth. They put Consumers at the center of their innovation. Innovation starts and ends with consumers – the small ways RB can make life better. So RB builds consumers into product development, validating every idea with them.

They don’t focus on ideas, but ideas that sell because they meet consumer needs.This philosophy creates they become powerful global brands that can adapt to local preferences.RB has its own technology insights and merging their own insight with consumers’ insight that they find by spending time with consumers their innovation comes. They also keep a close eye on technological and societal trends to find consumers need.

RB considers their innovation as a team effort. Driving a global formula means reacting fast and efficiently that requires teamwork.So innovation is integral to the business and RB creates strategic and external alliances in their business.All of which together give consumers worldwide reasons to buy RB products (www.rb.com, 2015).

SQUARE Group SQUARE Group, founded in 1958, has pioneered the development of the local business in fields as diverse as Pharmaceuticals, Textile, Information Technology, Healthcare Products, Food Products, and Hospital etc. With annual turnover above US $ 450 million and with a workforce more than 22,000, square today is a true icon in Bangladesh business sector.

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Product Mix of SQUARE Group:A product mix is the set of all products and items a particular seller offers for sale. The product mix of SQUARE Group consists of various product lines such as- Pharmaceuticals, Textile, Information Technology, Healthcare Products, Food Products, and Hospital etc. A company’s product mix has a certain width, length, depth and consistency. These terms are illustrated in case of Caterpillar Inc. in the following description-

Product Mix Width:The width of product mix is the number of product lines in the product mix. In case of SQUARE Group, Product Mix Width consist of its fifteen product lines such as- Square Pharmaceuticals Ltd. Square Toiletries Ltd. Square Textiles Ltd. Square Food & Beverage Ltd. Square Fashions Ltd. Square Knit Fabrics Ltd. Square Agro Development and Processing Ltd. Square Securities Management Ltd. Square InformatiX Ltd. Square Herbal and Nutraceuticals Ltd. Square Yarns Ltd. Square Holdings Ltd. Square Air Limited, Square Formulations Limited, Square Texcom Limited,

Product Mix Length:The Length of Product Mix refers to the total number of items in the mix. In case of SQUARE Group Product Mix Length consist of its (4+18+4+3+5+1+2+17+3+2+8+1+3+11=82) total Eighty two products.

Product Mix Depth:The Depth of Product Mix refers to how many variants are offered of each product in the line. In case of SQUARE Group, one item/product of Food and Beverage, Ruchi has twenty five variants. So the depth of Ruchi is twenty five. We can calculate the average depth of SQUARE Group. by averaging the number of variants within each product in the product line.

Product Mix Consistency:The consistency of the product mix describes how closely related the various product lines are in the end use, production requirements, distribution channels, or some other way. The various product lines of Square groups are somehow consistentin that they are mainly pharmaceutical industry, square hospital ltd., SQUARE Toiletries Ltd, and FMCG which is consistent among each other and square textile ltd., square knit fabrics ltd., square yarns ltd., square fashions are highly consistentbecause of their vertical integration among them (But these are inconsistentwith above mentioned industry). The various product lines of square group are consistent in case of production requirement, for promotional requirements, for substitute products, because raw materials, processes and man power needed for the production of its products are quitesimilar. In case of distribution channels, Square groups’ various products lines

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are less consistent because products are distributed to end-users by using different distribution channel.

Reasons for Diversification:

As a large company of Bangladesh Square needed various types of promotional programs but it required huge amount of many as well many effort. To save this huge amount of many needed for advertisement program square has created its own advertisement firm “Mediacom”

1. To run the ad firm square needed qualified media stars and to broadcast their promotional programs they needed a controllable channel so they have created their own TV channel “Masranga”

2. To fulfill the vacuum of quality data connectivity among their own offices and also profit motives they have created “square informatix limited”

3. To utilize their capital and as a company of world second largest garments product exporter country square has invested in Garments sector also

4. To make available the world class health facilities for those patients who go to abroad for their medical treatment square group has established “square hospital limited” in Dhaka

5. In order to facilitate the movement safely and comfortably for top executives, as well as Air ambulance/ EMS service for Square Hospital, Square Air has purchased a brand new world renowned Bell 407 helicopter and established their air business also.

6. To facilitate the farmers of the country square invested in the consumer food sector. By this line of their business they preserve the collected hygienic food from farmers and package this product for long-term use.

Those are the specific reasons for their diversification. But square want to fulfill the demand of quality focused customers as well as price focused customers so they have various product line, weigh and depth also.

The overall assessment of PRAN RFL against Caterpillar Inc., Reckitt Benckiser and Square Ltd.

Our conclusion about the overall assessment of PRAN RFL against Caterpillar Inc. is givenin the following as we could not find adequate data to compare PRAN RFL against Reckitt Benckiser and Square Ltd.

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Assessment on marketing mix activities:

Caterpillar Inc. falls in the category of industrial product and marketing of the industrial product. But PRAN falls in the category of consumer product and RFL falls in the category of both consumer product and industrial product.

Caterpillar products are relatively technical in nature, exact from often variable, accompanying services are very important. But products of PRAN are not technical in nature and there is no room for service. To some extent, some products of RFL is technical in nature and after sales service is important.

Caterpillar distribution system is dealer based and short, directs channel to PRAN-RFL market. Distribution system is broad, here involves distributor, wholesaler and retailer.

As Caterpillar products are complex in nature so relation with customers is relatively enduring and complex. But in case PRAN-RFL relation with customers is not so complex and enduring as much as Caterpillar.

Caterpillar demand depends on nature and macro-environment situation because the products of caterpillar are related to Construction Industries, Resource Industries and Energy & Transportation. But demand of PRAN-RFL does not so much depend on macro environment activities. Because the product of caterpillar is FMCG and FMCD

Most of the ads of Caterpillar Inc. has been put emphasis on brand building and improving corporate image but ads of PRAN-RFL give importance on selling activities as well as brand building activities.

Caterpillar emphasis on personal selling through dealer’s network and PRAN-RFL uses pull strategy. It is directing the promotional mix at ultimate consumers to encourage them to ask the retailer for the product.

Pricing of caterpillar is complex. It uses two system of pricing like Competitive bidding for unique items and list prices for standard item. PRAN-RFL uses list prices for their entire item(Thakral, 2015).

External Environment Assessment (Porter’s Five Forces Competitive Analysis):A. Threat of new entrants:The threat of new entrants can be said to relatively low, because of the

very high capital required to establish a new firm that produces heavy equipment. Small busi -nesses could enter the industry and provide heavy machinery through small-scale production. However, these small new entrants have minimal effect on firms like Caterpillar. Threats of new competitors are high in the business of PRAN-RFL Group. Because any type of companies can en-ter in the sector as the government is friendly in giving the trade license(Thakral, 2015).

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B. Threat of product substitutes: For some product category there can be a threat of sub-stitute product. But for most of the product there is no such threat of product substi-tute. The threat of substitution is low. For instance, crude tools can be used as substitutes to heavy equipment from Caterpillar. However, the current trend is toward mechanization and au -tomation. Thus, customers are unlikely to shift away from using heavy equipment like those from Caterpillar. In the business of PRAN-RFL Group threat of the substitutes is high. As there if Akij group, BD foods etc. are producing the same types of products. So, P is mak-ing something unfair to the consumers, the consumers may switch to other compa-nies(Thakral, 2015).

C. Power of buyers:Caterpillar’s buyers include groups and organizations. For example, construc-tion firms and government agencies purchase heavy trucks and machines from firms like Cater -pillar. The bargaining power of buyers is low because of limited options. Only a few major com-panies offer products with high quality and durability compared to those of Caterpillar. But the buying power of the consumers of PRAN-RFL Group is very high. As there are many con-sumers in the market so the consumers can bargain the prices of the products(Thakral,2015).

D. Power of suppliers: Caterpillar’s suppliers are companies that provide raw materials and com-ponents for its products. The company uses various suppliers for its production because it has different manufacturing locations around the world. No single supplier can exert significant pressure on Caterpillar’s business. Thus, the bargaining power of suppliers is low.Bargaining power of the suppliers of PRAN-RFL Group is low. As Bangladesh is agricultural country, so there are a lot of sellers of the raw materials of foods. So, the bargaining power of the seller is very low(Thakral, 2015).

E. Intensity of rivalry among competitors:Caterpillar faces high competition in the industry. In heavy equipment manufacturing, there are significant competitors from countries like Japan and the Netherlands. These competitors are also major players in the global market. They have engi -neering expertise comparable to that of Caterpillar. In financial services, competition is even higher. There are many small, medium and large financial service companies that directly com -pete with firms like Caterpillar. Current rivalry is very much high of the PRAN-RFL Group. As there are some huge groups like Akij Group and others, so it is seen that the rivalry amongst the current companies are very high.

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CATERPILLAR PRAN-RFL Group

Figure: Assessment of five forces of competition.

SWOT analysis (Thakral, 2015):

PRAN-RFL Group Caterpillar Inc.

Strength Weaknesses Versus Strength Weaknesses

Strong distribution channelHuman resourceWide drinks categoryThey have their own factory, dairy and manufacture

Management efficiencyTraining and development of companyShort life cycle of productPositioning as a local manufacturing companyContract resource

Global Market leaderDiversified geographical spreadstrong brand imagelarge-scale assetsstrong global distribution networkimproving financial condition

low rate of innovation

limited connections in emerging markets

Opportunities Threats Opportunities ThreatsExport Tie up with multinationalsStrong brand imageCompetitor’s weak distribution channel

Aggressive competitorsChanging consumer behaviorAvailability of

Opportunities in China and India Rise in raw material pricesimitation by Chinese manufacturers

The threats to Caterpillar’s business are continuous rising in the

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Threat of new entrants (Low)Threat of product substitutes (low/moderate)Power of buyers (Low)Power of suppliers (low)Rivalry among competitors (high)

Franchise business all over the world

foreign productAd hock advertisements of competitorUsing old technology

aggressive competition by Japanese roboticsIncreasing construction activities due to growing population

prices for key raw materials of the company.

Brand Development:

For PRAN-RFL:

A company has four choices when it comes to developing brands.

Line extensions Brand extensions Multi-brands New brand

New brand Line extensions occur when a company extends existing brand names to new forms, colors, sizes, ingredients, or flavors of an existing product category. PRAN-RFL follows the strategy.

Brand extension is Extending a brand to a new or modified product in a new category. Instant Consumable Jelly

Multi-brands are maintaining additional (more than one) brands in the same category. Company offers multiple brands for single category of product to their customers.

New brands are used when existing brands are inappropriate for new products in new product categories or markets. The products are new to the market.For Caterpillar Inc.:Line extension: Caterpillar expanded its heavy machinery equipment line.Brand extension: Introduce new products: shoes, bags, mobile phones and clothes with the same brand name.Multi Brand: Perkins: is one of the world’s leading suppliers of gas and diesel engines.Hypac: Provides mining equipment spares and components for electric drive off-highway trucks.New Brands: Caterpillar is now introducing new smart phones and they are also introducing new brand name with application software.

Recommendations:For PRAN-RFL:As being a very successful organization and there flawless management system has enabled Pran group to enjoy economies of scale through their profit maximization but as being a part of the culture of Bangladesh through their share of quality products they should also emphasize more on products that are within in the purchasing power of the general people of Bangladesh

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and ensure that products should be of quality that equal in aspects to compete with the international standards.For Caterpillar:In the next five years of operations, Caterpillar can improve performance through differentiation. The company must increase its investment in research and development to create unique products. At present, the heavy equipment, engines and financial services of Caterpillar are very similar to the ones available from competitors. To increase competitiveness, the firm must invest more in developing novel products.Caterpillar can also improve its financial performance by growing its distribution network in the next five years of operation. The firm must focus on developing markets because these markets have high economic growth rates. For example, the company can increase the number of Caterpillar distributors in China.

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ConclusionProduct selection is as important as the product you are selling. Firms need to strike a balance between giving customers’ choice and trying to cater for everybody. Dividing products into product lines and the product line into further groups, helps firms to develop product strategies. It can also help them identify which product ranges sell well and which do not if they choose to monitor each product line.

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viii. www.caterpillar.com. (2015). http://www.caterpillar.com/en/news/caterpillarNews/innovation/innovate-or-die-vice-president-greg-folley-unfiltered-on-innovation.html. Retrieved Nov 11, 2015, from http://www.caterpillar.com/en/news/caterpillarNews/innovation/innovate-or-die-vice-president-greg-folley-unfiltered-on-innovation.html

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