International Marketing Final PDF

8/10/2019 International Marketing Final PDF

1/28

Export Business Plan

1

Project Report On

INTERNATIONAL MARKETING

Submitted by

GROUP 16

MMM (2011-14) - Semester V

Submitted to

Prof. R. Venkatesh

Prepared By:

Name Roll No

Mr.Jitendra Dhumal 23

Mr.Raisuddin Khan 45

Mr.Manoj More 60

Mr.Nitin Urs 106

Mr.Faiyaz Chunawala 131


2/28


2

INDEX

Contents Page No.

About M/s Allana Sons Ltd 3-4

Products offerings 5-8

Rationale,Credit Risk Assessment 9-10

Interview 11-12

Business Plan- M/s ABC Foods Pvt Ltd

History 13

Product offering, Quality and Major Markets 13-14Production Facilities 14

Structure and Competition 15-16

Legal/Regulatory,Agreement, Export Regulation,Personnel Strategies 17

Market Research 18-20

Competition 21

SWOT Analysis 22

Marketing Strategies 22-23

Market Segmentation, Pricing and Promotion 24

Feasibility Report of M/s ABC Foods Pvt Ltd 25-27

Sales & Marketing,Trade Mode,Source,Future Expansion Plan,

Implementation Schedule 28


3/28


3

ALLANASONS LIMITEDAllana Centre,

113/115

M.G. Road, FortMumbai - 400001, Maharashtra

India

Tel:+91 22 66569000

Fax:+91 22 22695700

Background

The Allana Group founded in 1865 by the Allana family has presence in trade and export of frozen food,spices, oil seeds, edible oil, coffee, cereals and fruits most of which are exported to the Europe, MiddleEast, Far East and South East nations. As on March 31, 2011, ASL had two wholly-owned subsidiaries,viz, Allana Pharmachem Ltd. (non-operational) and Allana Mauritius Ltd (AML) (an investmentcompany). AML has investments in Egypt in Edible Oils and Fats. Further, ASL also has investments inother group companies such as Frigorifico Allana based in India, which has a frozen meat manufacturingplant in Aurangabad and Middle East Oil & Grains Ltd based in UAE who has investments in a large silofacility, which provides grain handling, transshipment services and edible oils and fats in Malaysia,among others.

Introduction:

Allanasons Limited was incorporated in 1973. It is the wholly owned exporting arm of the 135 year oldAllana Group. It is one of the largest producers and exporters of processed foods and agro-commoditiesfrom India. The product range includes frozen marine products, frozen buffalo meat, frozen halal buffalomeat, canned corned beef, sterilised meat and bone meal, tropical fruits and vegetables including puree,coffee, tea, cereals, oilseeds, mango pulp, frozen green peas, white guava pulp,

Allanasons Limited: Allanasons Company was founded by Abdulla Allana in 1865 in Bombay withthe sense of business and trading in agriculture products. It is now a major producer and exporter ofprocessed fruit, spices, coffee, frozen meat and marine products. Allanasons head office is in Mumbaiand is perhaps the largest exporter of Halal boneless buffalo meat. Canned corned meat and frozenoffal are the other major meat products which are exported by the company. The Allana Group haspioneer (1969) position in the export of deboned and deglanded frozen Buffalo meat, exporting itsproducts currently to 64 countries worldwide, including South East Asia, the Middle East, CIS(Commonwealth of Independent States), Africa and Pacific Basin Nations, singularly accounting forabout 60 per cent of meat exports from India. It has registered modern, integrated meat processingabattoirs cum plants at Mumbai, Delhi, Taloja Maharashtra and Sahibabad Ghaziabad UP, which wereset up according to the highest international standards and specifications, and incorporating the latesttechnology and automation in all stages of meat production. The company adheres to the requirementsof Islamic slaughter.


4/28


4

The Industry Leader

Allanasons.India's largest exporter of processed food products and agro commodities. The Company

has been designated as the Five Star Trading House by the Government of India. We are the World'sLargest Producer and Exporter of Frozen Halal Boneless Buffalo Meat!

But, that's not all. Allanasons is also India's single largest exporter of frozen meat, processed/frozen fruitand vegetable products.

India's Largest Exporter of Frozen Halal Buffalo Meat, Coffee, Fruit Concentrates and Purees...

What's more, Allanasons is India's largest exporter of coffee as also leading exporter of cereals andfrozen marine products.The Group has also set up plants for processing, preserving and freezing ofMarine Products, which are approved in accordance with stringent quality standards for export toEurope. The Group has made substantial investments in creating world-class integrated food processing

complexes. Facilities, which have been certified for quality and product safety systems under ISO9001:2000 and HACCP. And ISO 14001 (Environment Management System) too!


5/28


5

PRODUCTS:

Range of products:

Fresh, frozen boneless Buffalo Halal meat Chilled boneless Buffalo meat Compensated boneless Buffalo meat issupplied in natural proporation of the cuts and is guaranteed 93 %chemically lean Canned corned meat Full range of fresh quick frozen offals( fancy / variety meat )

Meat Products : Frozen Halal Buffalo Meat

The Allana Group enjoys the distinction of being the pioneer (1969) in the export of deboned anddeglanded frozen Buffalo meat, exporting its products currently to 64 countries world-wide, includingSouth East Asia, Middle East, CIS, Africa and Pacific Basin Nations, singularly accounting for about60% of meat exports from India.We are the World's Largest Producer and Exporter of Frozen Halal Boneless Buffalo Meat!

Different Cuts of Buffalo Meat & Variety Meat
http://www.allana.com/corp/images/products/meat/meat_inside_round_long.jpghttp://www.allana.com/corp/images/products/meat/meat_heart_longer.jpghttp://www.allana.com/corp/images/products/meat/meat_chuck_tender_longer.jpghttp://www.allana.com/corp/images/products/meat/meat_brisket_long.jpghttp://www.allana.com/corp/images/products/meat/meat_thick_flank_long.jpghttp://www.allana.com/corp/images/products/meat/meat_tenderloin_large.jpghttp://www.allana.com/corp/images/products/meat/meat_striploin_large.jpghttp://www.allana.com/corp/images/products/meat/meat_silverside_with-eye-round.jpg


6/28


6

Meat Products : Frozen Lamb Meat

Lamb meat has a high nutritional value and is an especially good source of easily absorbed zinc andiron. It is also low in fat and an excellent source of vitamins and minerals.

Range of products:

Frozen Lamb carcasses Frozen bone-in Lamb cubes Chilled Lamb carcasses Chilled Lamb cuts

Different Cuts of Lamb Meat

Meat Products : Frozen Canned Meat

In our vertically integrated plant the main products namely, Corned Meat and Frozen Meat areprocessed on the upper floor while the by-products processing is carried out on the ground floor tomaintain plant hygiene standard at the highest level.

All animals slaughtered at the ultra modern abattoir-cum-meat complex undergo ante mortem andcontinuous postmortem inspection, carried out by the government veterinarians and the entire CornedMeat processing operation is under the supervision of Central Government Inspection Agency. A
http://www.allana.com/corp/images/products/meat/meat_lamb_boneless_shoulder_long.jpghttp://www.allana.com/corp/images/products/meat/meat_lamb_saddle_8_ribs_chump_off.jpghttp://www.allana.com/corp/images/products/meat/meat_lamb_saddle_8ribs_chump_off.jpghttp://www.allana.com/corp/images/products/meat/meat_lamb_loin_8_ribs_chump_off.jpghttp://www.allana.com/corp/images/products/meat/meat_lamb_leg_aitch_bone_out_chump_lo.jpghttp://www.allana.com/corp/images/products/meat/meat_lamb_frenched_rack_long.jpghttp://www.allana.com/corp/images/products/meat/meat_lamb_boneless_chump_long.jpghttp://www.allana.com/corp/images/products/meat/meat_shank_without_bone_long.jpghttp://www.allana.com/corp/images/products/meat/meat_rumsteck_long.jpghttp://www.allana.com/corp/images/products/meat/meat_rib_eye_boneless.jpghttp://www.allana.com/corp/images/products/meat/meat_neck_longer.jpghttp://www.allana.com/corp/images/products/meat/meat_liver_longer.jpghttp://www.allana.com/corp/images/products/meat/meat_knuckle_long.jpghttp://www.allana.com/corp/images/products/meat/meat_kidney_longer.jpghttp://www.allana.com/corp/images/products/meat/meat_inside_round_pat_lo.jpg


7/28


7

comprehensive veterinary health certificate is issued for every consignment of Corned Meat Confirmingits suitability for human consumption.

A Halal certificate is provided for every consignment. Corned Meat is produced from thoroughly trimmedfore-quarter hind-quarter cuts and has appealing pinkish red colour, pleasant flavour, characteristic ofCorned Meat.

Different Corned Meat Products

Alfa Bon Hayat Piccadeli

Premier Tiffany Tristar

Meat Products : Vacuum Packed Chilled Meat

Vacuum Packed Chilled Meat is a Unique packaging process widely used for poultry, cheese and freshchilled meat. Foods are packaged in special plastic bags which are then vacuum-sealed and shrunk to

be like a second skin. The resulting package is air-tight and moisture proof, protecting the food fromoxidation and dehydration during storage.

It extends storage life to 90 days or more at 2C while preventing weight loss from shrinkage andtrimming loss.

Restaurants that buy fresh vacuum packed chilled meat can offer their customers meat that is bothtender and juicy and save shrink and trim losses. Fresh meat can be bought for inventory, eliminatingoverbuying and under buying. Meat cutting and wastage are reduced.


8/28


8

Meat will become tender just as fast in vacuum pack as under ordinary hanging conditions becausetenderizing is an enzymatic process that goes on inside the meat. Natural Enzymes in the meat act tobreak down the tissues and make the meat more tender. The so called aged flavor comes from mouldgrowth and does not develop in Vacuum Packed meats.

Shrink and trim losses on unpacked fresh meat during two weeks of ordinary handling conditions mayrun as high as 5% from evaporation, dehydration and from removal of dehydrated, discoloured, orcontaminated surfaces. Vacuum Pack eliminates these losses.

Meat Changes in colour from bright red to purplish-red when oxygen is removed from the Vacuumpackage by the vacuum sealing process. After the package is opened, and oxygen reaches the meatsurface again, the original red colour returns.

The fluid is not blood, but drip which comes out from the cut surfaces of the meat. Natural pigments inthe meat give the fluid a reddish-brown colour. The amount varies with the extend of cut surfaceexposed, the quality of the meat, and the storage conditions, but is usually less than 1% far less thanwhat is lost by evaporation under ordinary hanging conditions.

A slight confinement odour may be noticed when the package is first opened, but it disappears within afew minutes.The Extra moisture in this meat acts as a good heat conductor, and so cooking times may be shorter.

Different Cuts of Chilled Meat

Neck Topside Knuckle Tenderloin
http://www.allana.com/corp/images/products/meat/meat_chilled_31.jpghttp://www.allana.com/corp/images/products/meat/meat_chilled_42.jpghttp://www.allana.com/corp/images/products/meat/meat_chilled_41.jpghttp://www.allana.com/corp/images/products/meat/meat_chilled_17.jpg


9/28


9

ALLANASONS LIMITED

Rationale

The rating continues to derive strength from the long track record of thegroup, professionally qualified and experienced promoters, established brand name, growing operations,well-spread international presence with wide product portfolio, long-term customer relations andcomfortable liquidity.

Further the rating also takes into account comfortable working capitalmanagement and present debt-free status of ASL.Going forward, the ability of the company to maintain strong liquidity profile as well as working capitalmanagement would be the key rating sensitivities.

Credit Risk Assessment

Long track record of the group and experienced promoters as well as management

The Allana Group, formed in 1865, is a leading player in various segments of the FMCG (food) industry.The Group is among one of the worlds largest exporters of frozen Halal Buffalo meat. ASL wasincorporated in 1973 as the trading arm of the Allana Group. The company is managed by a three-member Board with one of the promoter, Mr Irfan. R Allana, serving as the Chairman. The Board issupported by well-qualified and experienced top management.

Growing operations

The turnover of ASL has been increasing constantly from Rs.3,581crore in FY09 (refers to the periodApril 2008 to March 2009) to Rs.3,730 crore in FY10 and to Rs.4,783 crore in FY11, which is a growth ofnearly 33.56% in FY11 as compared to FY09. This was mainly due to increase in demand of frozenfoods, coffee and oil seeds in the international market.

Well-spread international presence with a wide product portfolio

ASL owns the Allana brand under which it distributes the Groups products. This leading brand of Halalbuffalo meat has been in existence since 1979. ASL also has a diverse basket of products with frozenfoodstuff (including meat, mutton, fruit pulp,leather among others) constituting more than 85% of salesover the past three years. The other products in the portfolio include coffee, oil seeds, spices,engineering goods, bags, etc which are sourced from the group companies. Over the past threedecades, ASL has established its presence across the globe with specific target markets being Europe,Middle East, Far East and South East

Asian nations which contributed approximately to 69% of the total sales in FY11 and balance 31% whichis contributed through domestic markets. The company distributes its products under the brand nameAllana to wholesales who further distribute them to retail customers.


10/28


10

Long-term customer relations

Although ASL does not enter into long-term contracts with its customers, it has maintained long-termrelations with its distributors in the international markets. The company receives 30-40% advance

payment from its customers, resulting in lowcollection period; another 30% are backed by Letter ofCredit, while the balances are open receivables. The company has rarelyprovided for, or written off baddebts in the past.

Comfortable Working Capital Management & debt-free company

ASL being a trading company has highly working capital intensive operations. However, the companysoperations are unique with very low to negative working capital cycle. As ASL is the trading arm of thegroup and the creditors being the associate companies which are supporting ASLs working capitalrequirements by providing long credit periods, the company is not dependent on its bank borrowings.Moreover as on date, ASL has not availed any term loan. This has resulted into low interest out go forthe company. Further, the company as on March 31, 2011 has cash and bank balance of Rs.221 crore.

Moreover, ASLs utilization of the working capital limits till October 30, 2011 was very minimal.


11/28


11

M/s Allana Sons Ltd

Interview with the Export Manager

Allana Sons Ltd is into export of Buffalo Meat across most of the international countries e.gChina, Malaysia, Indonesia ,ASEAN Country, Europe,Russia and Gulf countries

Allana Sons Ltd has 5 factories in UP namely Aurnagabad,Aligarh,Unnow,Sahibibab,ZerabadAND cold storage in Mumbai namely Vashi,Taloja and Kalwa

Buffalo meat is exported in variance of 18Kg,20Kg and 28Kg respectively

From North India Initially the meat was cartooned and packed in the freezer van and sent toJNPT Mumbai.The cost of Loading,Unloading and Travel time was High so in order to reduce the

cost and time they decided to package the whole meat in Mumbai and sent to JNPT Mumbai.

Allana Sons Ltd preferred the following payment system :

Letter of CreditThis Payment system is preferred by Party and Allana Sons does 10%of the business on this mode

Advance Payment(D/A)Allana Sons Ltd does 60% of the business in this mode asthey find this as safe. They preferred this as the client are not regular clients.

CAD (D/P)30% of the business is done through this mode and they do it only with theclients with whom they had good relation.Even new clients they do it if the referenceclient is trusted and depending on the strong relation they had with them.

Average they export 200 container per month

The export manager we met is responsible to export to IRAGDue to Political issue with IRAGthey preferred to export via Kuwait at Jordan

The following Items they follow while exporting

Commercial Invoice Certificate of Origin Packaging List Health Certificate Halal Certificate

Bill of lading provided by the shipping company

They tied with most of the banks in India but primarily do the business with UBI and Vijaya Bank


12/28


12

BUSINESS

Last month they done the business of 1800 tonne Cost is Rs $ 60000/container Total Business = $60000*1800

Total Business approx 6000Cr/Annum considering average 1400 container

Example shared by Allana Sons Ltd

Why considering Advance Payment:

Due to some reason if the client says that he cant make the payment for the exported goods which islanded at the Kuwait port then Allana Sons Ltd will take back the goods from the Kuwait port to Mumbaior any other client ordered for the same.

During the landing of the Goods at Kuwait port and taking back the freight charges is adjusted againstthe advance payment received by the Kuwait client.

This way they ensure they are losing the money and the business

Benefit of Strong Relation in case of wrongly exported to Y country instead of XHe said that, few months back one of the client requested for the goods to be exported to Jordaninstead of Kuwait.The concern manager wrongly transported to Kuwait.On noticing this, Allana Sons Ltd requested the concern authority at the port to sent to Jordanand it was done purely due to the good and strong relation.

As per his understanding being Allana Sons Ltd is a Islamic Organization, they dont prefer totake the lnterest or give Interest as its against the Islamic Law ; hence they dont preferred loansystem or even its there it would be very low-

ALMOST DEBT FREE COMPANY


13/28


13

BUSINESS PLAN - M/s ABC Foods Pvt Ltd.

HISTORY

PRODUCT AND ADVANTAGES

Buffalo Meat:

ABC exports started with the chief aim to manufacture, export and supply highly nutritious buffalo meat.The range offered by us includes topside, knuckles, silverside ,rump stick, blade, eye round, tenderloin,strip loin, chuck, chuck tender, shoulder, neck, cube roll, forequarter, buffalo tongues, buffalo tails,buffalo heart, cuts, buffalo kidney, buffalo liver and buffalo offals.

We will try to reputed identity in the global market by consistory offering products of the best quality.Today, we are exporting these products across the globe to various countries like ASEAN, China andGulf Countries etc. Our aim is to provide maximum satisfaction through prompt deliveries and affordablepricing of the buffalo meat. Consequently, we would like to earn the loyalty of clients from all over theworld with each order to sustain our position as one of the fastest growing names in the domain.

MeatIndia.in website owned by ABC foods Pvt Ltd, a manufacturer, processor, exporter of fresh andfrozen Buffalo meat, Lamb meat, Veal meat, Seafood in India. The company is a fresh start by Mr.Jitendra Dhumal ,Mr.FaiyazChunawala, Mr.Raisuddin Khan,Dr.Manoj and Mr.NitinUrs.

ABC foods Pvt Ltd is an independently owned and operated wholesale meat purveyor located inIndia. This meat export company will manufactures and process, a variety of meat products as perindividual specifications and needs of meat buyers outside India. What you want? how you want it?and when you need it? we export meatfresh or frozenwith consistency time after time.

The meat export activities are in ASEAN countries, CHINA and GULF countries which remain strong,

due to the ability to offer competitive and highly reasonable pricing as a result of our maintainingsubstantial meat inventory in India. Our prime product is fresh and frozen Buffalo meat, a Halal foodproduct, which abide by Islamic law.

ABC foods Pvt Ltd takes pride in itself on successfully maintaining close relationships that allows themeat export company, a direct access to supply markets (producers, distributors and shippingcompanies worldwide), a quality multilingual staff, and a thorough knowledge and a wealth ofexperience in the global meat sector. We can help you to feel at ease in the world of internationalmeat supply and trading.

Our expertise spans markets worldwide and our ability to maintain inventory and make forwardcommitments allows us to respond promptly and directly to our customer's vibrant needs. We

maintain our commitments and responsibilities worldwide to our strategic producer and customerpartners.


14/28


14

We have advanced facilities for keeping the buffalo meat in optimum conditions. Besides, we have state-of-the-art equipment for cutting and packaging of the meat under conditions of strict hygiene and qualitycontrol. All the facilities are upgraded continually keeping in line with changing trends.We are backed by a strong distribution network that enables us to provide time bound and safe deliveryof products. Supported by this, we are dealing in the countries like china, vietnam, iraq, kuwait, dubai

etc.

We treat quality as our prime concern and make every effort to ensure that the meat supplied by usreaches the clients in top condition. We assure that buffalo meat, we supply is passed through severalquality checks. Moreover, we provide hygiene packaging for our buffalo meat, so that there is nocompromise in the quality.

Quality

The Company through dedicated and extended research and development, has skilled itself to

understand the psyche and needs of importers/ consumers in-depth. The company imbibes to maintaininternational quality standards, which has been, the primary rationale for their success in theinternational markets.

Customer Satisfaction is a stringent policy followed by the Company. The adherence to this policy,has brought to the company, repeated orders and loyal customers - globally.

Major markets:-

China, Malaysia, Philippines, UAE, Iran, Jordan, Kuwait etc.

Production Facilities:-

The major meat production centres for exports are as under:

India is rich in itslivestock wealth. Itaccounts for nearly 16%of the world cattlepopulation, more thanhalf of world buffalopopulation and about17% of worlds goatpopulation.

Aurangabad,Nanded, Mumbai and Satara inMaharashtra Goa Medak Dist.In Andhara Pradesh. Derabassi in Punjab

Aligarh, Unnao and Ghaziabad in UP Cochin in Kerala

In addition, the exporters source their meat requirementfrom various Municipal Slaughter Housesthroughout thecountry. Some of the slaughter houses from where theexporters source their requirementare Deonar abattoir,Mumbai, Meerut, Jaipur, Saharanpur, Bareily, Hapur,Muradabad, Khurja, Gangoh,Hyderabad, Aligarh,Muzzaffar Nagar, BulandSahar and Meerut slaughterhouses.


15/28


15

Structure and Competition:-

World Exports 2013 Revised:

Broiler Meat Higher, Beef Lower and Pork Unchanged


16/28


16

Summary:Major Traders and U.S. Trade of Beef, and Poultry

Per Metric Tonnes 2008 2009 2010 2011 `2012 2013%Change

Production

Beef and Veal 58367 57180 57303 57058 57257 57527 0.5

Consumption

Beef and Veal 57501 56209 56151 55367 55759 56044 0.5

Exports

Beef and Veal 7605 7458 7822 8090 8134 8601 5.7

Growth Rate :-

Country %

USA 46

Japan 9

South East Asia 7

EU 6

Taiwan 6

South Korea 5

China 5

Canada 4OPEC 2

HK 2

Competition:-

USA Brazil EU China

Argentina Australia Mexico Russia Canada Japan Paraguay South Korea Saudi Arabia


17/28


17

Legal/Regulatory

Beef Labelling The Beef Labelling Regulations apply to fresh, frozen and minced beef, with theinformation relating to the produce, applied to or attached to individual pieces of meat or to their

packaging material. Where beef is not wrapped, the information is required to be provided in a writtenand visible form to the consumer at point of sale.

The following Items we will follow while exporting

Commercial Invoice Certificate of Origin Packaging List Health Certificate Halal Certificate Bill of lading provided by the shipping company

AGREEMENT

We are providing the pro forma of the agreement excluding the buyer and seller agreement to you anddate of agreement.

http://www.rogercohen.com/training/distributor_agreement.shtml

Export Regulation

http://www.apeda.gov.in/apedawebsite/MEAT_MANUAL/Chap6/Chap6.pdf

Personnel strategies

We our self manage the business of our own wont hire a any employee as we are capable of doing it on

our own for any help related to any legal help we approach a Export Consultant for any help for at least

of two year in nascent stage.
http://www.rogercohen.com/training/distributor_agreement.shtmlhttp://www.rogercohen.com/training/distributor_agreement.shtmlhttp://www.apeda.gov.in/apedawebsite/MEAT_MANUAL/Chap6/Chap6.pdfhttp://www.apeda.gov.in/apedawebsite/MEAT_MANUAL/Chap6/Chap6.pdfhttp://www.apeda.gov.in/apedawebsite/MEAT_MANUAL/Chap6/Chap6.pdfhttp://www.rogercohen.com/training/distributor_agreement.shtml


18/28


18

Market Research

Market research is any organized effort to gather information about target markets or customers. It is avery important component of business strategy. Market research is a key factor to maintaincompetitiveness over competitors. Market research provides important information to identify andanalyze the market need, market size and competition. Business decisions that are based on goodintelligence and good market research can minimise risk and pay dividends. It helps Identify potentialcustomers, set realistic targets, develop effective strategies and lastly identify business opportunities.

Export marketing requires the support of marketing research in the form of market survey, productsurvey, product research and development as it is highly competitive. Various challenges, identificationof needs and wants of foreign buyer in export marketing can be dealt with through internationalmarketing research.

Overseas market research is a must for successful and profitable export marketing. This is the mostpromising way of making companys marketing operations sensitive to the changing requirements of

international markets. Published data on different aspects of global marketing are now available easilyfor the conduct of overseas market research. Field research is required when published data are notavailable as per the need of the research project. The popularity of overseas market research is fastgrowing along with the globalization of business.

Selectivity is the key to success in all spheres of life including export marketing. An exporter may wish todeal in all kind of products and to sell them anywhere in the world. However, it is not possible for him todo so due to the wide expanse and demand variations in different markets of the world. Therefore, anexporter has to select proper products and proper markets in order to operate at the international level.

We need to identify a few top markets; we need to then narrow down each into market segments andbegin working on the countries with the most potential. Generally, when there is enough volume of

exports to a specific country or region, adequate secondary market research is available. As marketresearch reports are quite expensive to produce, they are not done on products which have little currentpotential or where there may be significant constraints in the form of regulation, tariffs, non-tariff barriersor economic and political upheaval.

We approach a international market consultant for a help and we collect the data our self from theinternet and visiting the target market. We will also find a tariff impose by the any country.

Target Countries:

Primary : ASEAN countriesBrunei Darussalam, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar,

Philippines, Singapore, Thailand, VietnamSecondary: Gulf countriesKuwait, Iraq, Bahrain, Oman, Qatar, Saudi Arabia and UAE , Jordan andchina


19/28


19

Market conditions in the target countries:

India is likely to become the worlds largest beef (buffalo meat) exporter by end o f 2013, if not sooner.Import of beef from all sources is restricted and as such imports are set at nil. As a price-based

competitor, India has seen export increases in the previous two years to Middle Eastern, African andSoutheast Asian countries. (Source: Global Trade Atlas)

ASEAN countries are trying to secure greater investment in their own beef industry, making it likely thiswould be a pre condition before they agree to allow increased imports of Bovine meat. In the Asianregion, livestock provides major additional contribution to agriculture through draft power, manure, fueland as a fertilizer, animal products such as meat, milk eggs while poultry provide daily cash income andmuch required nutrition to rural population.

Many Asian countries, mixed farming involving crops and livestock integration has been a way of lifesince the beginning of agriculture. It is widely realized that this is the only method of providing additionalincome and employment to the small farmers and land less labor families. Countries in many South

Asian countries, next to crops, animal husbandry has the largest employment potential in rural areas.Further this sector can make a significant contribution to promote re-distribution effects of income infavor of weaker sections.

Existing Demand in ASEAN countries:

Meat retail expansion is reliant on distribution systems, affordable transportation costs, urbanization,with subsequent construction of supermarkets and hypermarkets, effective disease control, and goodslaughter facilities. As health conscious consumers in the West turn to vegetarian diets, meat demand isslowing. This is offset by rising demand in Asia-Pacific, which is followed by North America and the EUin terms of consumption.

The meat industry has suffered due to diseases such as foot and mouth disease and avian flu, withimports of some products being banned in major markets. Pork meat leads the meat market, withpoultry, beef and veal following. The biggest producers of cattle include the US, China, India, Argentinaand Brazil.

Promising trends have appeared for bovine meat consumption in countries like Vietnam, Hong Kong andMalaysia according to a recent report by Meat and Livestock Australia. The strongest growth has beenevident in Vietnam where consumption over the last six years has risen by 114% to 541,000 tonnes.Livestock plays a vital role in economic development particularly as societies evolve from subsistenceagriculture into cash based economies.

Indonesia:

There are three things that accounted for the great demand of cattle meat and meat products in thecountry: the ever increasing human population, changing eating habits of the Filipinos, and importliberalization. Among the popular foods made from beef are kaldereta, nilagang bulalo, tapa, cornedbeef, and mechado. The cattle industry is heavily dependent on the importation of feeder stocks.


20/28


20

For 2014, Indonesias Ministry of Agriculture has allocated as much as USD 823 million for agricultureself-sufficiency programs. Agriculture Minister Suswono revealed that the allocations for corn, soybeanand beef self-sufficiency programs are USD 40 million, USD 87 million and USD 149 million,respectively.

Malaysia:

Malaysias food and beverage sector is increasingly sophisticated and influenced by health andconvenience trends. Consumer awareness in nutrition value and food fortification for healthcare hascreated the demand for functional, minimally processed fresh, organic and natural foods. Consumersare also brand conscious and demand convenience and variety, including where they source the items.

The demand for red meat continues to rise. Malaysia predominantly imports red meat from India,Australia and New Zealand as products form these companies are able to satisfy local food safety andHalal requirements. Australia, with its stringent source traceability enforcement and absence of meatsafety problems is one of the top supplying countries for red meat (beef and lamb) in the world.

Australian red meat contributed 24.34 per cent in value, of total meat imported into Malaysia in 2011(source: International Trade Centre).

Vietnam:

Meat production costs in Vietnam are high, relative to other countries, because of inherentshortages in good quality indigenous feed materials and the use of imported animal feedingredients, inputs and feed products. Trade and government sources comment that local feedproduction costs have substantially risen over the past 5 years, because of higher world market pricesfor key feed ingredients.

Short term measures, i.e. tariff rate increases, being applied in an attempt to control an explosion inmeat imports. These actions are reactive, and highly confusing for importers and the broadermarket, because imports have dealt with local shortages, and so generally kept the market in

balance and local meat market prices reasonable.

Overall, there is a high degree of trade policy chaos in Vietnam largely because too many governmentdepartments and agencies are involved, and most do not understand the WTO or FTA commitmentsand protocols that Vietnam now has to work within. The core focus at present continues to be tacticalprotectionism and dealing with balance of trade issues, rather than moving forward in a strategic andtransparent manner with a focus on implementing its existing trade policy commitments.

The Global Demand for Beef

There are six major beef exporting countries: Brazil, Uruguay, Argentina, USA, Australia andNew Zealand. Brazil exported .243 mmt of fresh and chilled (F&C) beef and 1.2 mmt of frozen

beef in 2005 and surpassed Australia (.419 mmt of F&C) and .934 mmt of frozen beef) as thenumber one beef exporter. Brazil, Uruguay, and Argentina are investing in their meat industriesto remain strong and competitive.

During the period of large surpluses of animal products, the EU had a distorting affect on thedomestic markets in African countries. Frozen beef, mainly in forequarter cuts, were beingdumped in Africa, mainly West Africa. This distorted local prices for livestock and meat. Withthe enactment of the Central Agricultural Policies (CAP) for the EU, the regions exports


21/28


21

declined to 1.5 mmt in 2005 and is expected to further decline to 800,000 mt in 2015. The EUcould be a net importer of 530,000 mt of beef in 2015.

Meat imports are increasing in Asia driven by the effect of rising incomes. The major importers

will continue to be South KKorea and Japan. It is likely with these large volumes of imports intoAsia and other regions, that West and Southern Africa would increasingly become more deficitin meat. For Ethiopia to be a serious export player, the industry will need to be better integrated andvertically coordinated up and down the value chain.

Countries have certainly used SPS as a highly effective form of protection from the pressuresarising from globalization (IMS - GIRA). Middle East countries have been in the forefront inthis regard. Ethiopia has experienced this situation in outbreaks in the Horn of Africa and East

Africa when the live and meat exports were stopped solely because of association.

Australia is the major exporter of live cattle to the Middle East. For the period of 2003 through2005, Australia exported 96,036 head, 60,319 head and 141,449 head respectively. The average price

per head was $735 over the three year period.

The major importer over the period of 2003 to 2005 of live cattle was Israel with 96,000 head.Jordan imported 74,000 head of cattle and Saudi Arabia imported 33,000 head. Other importerswere Egypt (14,500 head), Kuwait (11,200), UAE (6,920), Qatar (780), and Oman (1,200). Thesimple average price for Australian cattle exported to the top four importing countries was $462per head in 2005. (All export valuation data reported by exporting countries is the FOB priceand import valuations are CIF prices.)

Competition:

The world's largest exporters of beef are India, Brazil, Australia and the United States. Beef productionis also important to the economies of Uruguay, Canada, Paraguay, Mexico, Argentina, Belarus, EU, andNicaragua give a competition for the meat.

Global beef production for 2013 is virtually unchanged from the October estimate at 57.5 milliontons as a sharp downward revision for India is offset by increases for a number of other countries.

Although still forecast at a record, global exports are dropped 355,000 tons to 8.6 million driven by amore reticent outlook for India which exceeds upward revisions for Brazil and Australia. Import demandin East Asia, particularly in China and Hong Kong, is stronger while other key markets are weaker onlower consumption (Mexico) or increased production (South Korea).

Brazil

Production is revised 125,000 tons higher to a record 9.5 million. Despite a shift of some pastureto soybeans and corn during the current season, herd expansion is bolstered by government support,genetic improvements, better pasture management, sustained cattle prices, excellent pastureconditions, greater supplies of slaughter cattle and strong international demand.

Exports are revised 150,000 tons higher to nearly 1.6 million as stable competitive prices and amplesupplies boost shipments. A 16 percent devaluation of the Real over the past year will help Brazilian


22/28


22

competitiveness. Thus despite the atypical BSE case in the state of Parana, only made public in late2012, restrictions by Saudi Arabia, Japan, South Africa, South Korea, China and Taiwan (combined lessthan 5 percent of exports) will be more than offset by demand from other markets. Increasedopportunities for shipments to Russia will likely be generated due to gradual Brazilian plant relistings aswell as Russian restrictions on competing U.S. beef

SWOT ANALYSIS:

Strengths:

Providing Halal meat catering to the Middle east and gulf countriesCheap cost of production and labourGeographical proximity to major markets

Weakness:

Non acceptability of imports from India In the developed countries due concerns about diseasesBan on cow slaughter

Opportunity:

Decline of Brazilian meat due low availability of landIndia has the largest herd of cattle in the world

Threat:

Increasing popularity of beef from Australia world over and more so in the developed countriesIncreasing popularity of Poultry and Pork meat world over

Economic barriers of entry: Trade barriers

A large number of overseas markets are subject to some form of entry barrier. These impediments totrade are imposed in many forms.Border protection measures, including tariffs and quotas, are the most obvious. However, non-tariffbarriers including unfair competition in the form of subsidies, technical imposts, and exports fromcountries that subsidise their domestic industries, are also major issues.

The following market strategies are proposed:

1. Research the retail and food service meat markets in Gulf States including Egypt for bovine meat In-

country market research using a local company would enhance the exporters understanding of futuretrends in demand and which demographic groups to target. (The databases consulted do not provideenough information on specific market segments and their preferences (fresh, frozen, types of cuts,packaging, etc. In fact, data on MENA markets had to be derived from data presented by the primaryexport countries and then summed by product categories).

2. Identify a market intermediary, a local service provider (LSP), in each country in the Gulf States, Whohas the capacity to enhance market linkages and represent Indian meat companies in Penetrating the


23/28


23

market segments identified as most promising in no. 1 above. The LSP could be Responsible forpromoting both generic and branded programs (see #5).

3. Indian meat exporters prepare promotional materials and attend food shows in the region,such as the International Food Show in Dubai. This activity will lead into the initiation of trialshipments outlined in #4.

4. Initiate trial shipments of experimental products for the market segments with the assistance of theLSP identified in no. 2. Emphasis would be on value-added products that fit a particular niche, i.e. hotelbuffet items (e.g. roasts), cubed meats for shiskabobs or a particular type and preparation of varietymeat products.

5. With the help of the LSP, undertake a promotion program, for example running a feature in a set ofhotels or supermarket outlets for a period of time with a generic Ethiopian meat promotion program.

Another opportunity would be to develop and feature an Indian meat item for a chain of restaurants in acountry.

6. Improving Market access :

As one of the worlds largest exporters of red meat and livestock, access to international markets iscritical to the ongoing prosperity of the industry. Securing market access creates the platform forpenetrating overseas markets and gaining market share.Unfortunately, threats to existing conditions of access are ever-present. While historically these threatshave involved raising economic barriers to trade, more recently governments have increasingly utilisedregulations to severely restrict access.Organize a tread fare and tread meet of the distributer with the help of local consultant which will help togain a increase in the revenue


24/28


24

Market Segmentation

In the distribution of product, the following shall be considered:

Focus the highly acclaimed slaughters house which supply meat to the various class of customers.

Target groups would be the high end customers competing for the best possible meat.

Displacing the import of meat from countries like Bangladesh, Indonesia, Brazil, etc. by 50% in 5 years

Market Pricing and Promotion

The price of the meat would range depending on the size and quality. This price would also varydepending on the existing market price of the meat. As we compete with other meat-producingcompanies, we will promote our products through advertisements with the aid of streamers andpamphlets. We can also make our business known through recommendations and connections with

well-known businessmen in the locality

Strengths:

Produce high quality meat

Adds more vitamins and Minerals

Relatively good infrastructure systems.

Good Marketing system

Meat market is strong and largely unexploited

Meat enterprises are environmentally friendly

Weakness:

Lack of efficiency in meat production

Lack of supervision on what the cattle eat

Old technology

Meat enterprises need high start-up costs to establish a profitable business

Hygienic slaughter house environment


25/28


25

Feasibility Report of M/S ABC FOOD PVT LTD

Key elements of the plan:-

We are planning to take ready cut Buffalo meat from a third party as of now. We will also rent a coldstorage facility at Taloja in a small place near JNPT and Office at Vashi or Panvel.

Financial decisions

We will start a business with a cash of Rs 50 Lakhs from our end and we will approach a bank for Rs 1Cr loan for the new business we all are the five partner in the ABC FOOD PVT LTD with a share of 20 %each.

For the order we will start consulting with a agency from the International market and some distributer

prior to the order so that we will have a some order in hand being we are new in the market we will givediscount to the buyer so to achieve the sale.

Sales Plan for the Year:

We are targeting Turnover of Rs. 10 Crore. That is the turnover of 520540 tonnes of buffalo meat.And 40 feet container of 2530 which in totality brings the revenue of around 10 Crore. Our aim is to tryto make the net profit of 10% to 15%.

Sales Plan per Ton:

We will sell buffalo meat at a price of $3200/ton on an average. Even though the international marketprice is pegged at $3500/ton.

Converting it into Rs. = 3200 x 60 = Rs. 1,92,000/ton (taking a flat rate of Rs. 60 to a dollar). So Per kg= Rs. 192. This is our avg. selling price.

Our aim would be to get the best quality meat at lowest price. For the same we have decided tokeep our purchase from domestic market to an avg. of Rs. 80/kg.

Profit Calculation:

80 = Purchase of Meat from Domestic Market

+ 10 = Cold Storage & Transportation charges.

+ 05 = Wastage

95 = Total (A)Cost of the Goods


26/28


26

Gross Profit

192 = Selling Price

- 95 = Cost of the Goods (A)

97 = Gross Profit

Operating Expenses

40 = Sales & Marketing Expenses, After Sales and Brokerage Charges.

+ 10 = Administration, Office Charges, Insurance and Bank Charges.

+ 05 = Freight Charges*

55 = Operating Expenses

(Company will bear Freight charges for those customers who pay an advance payment of

30% and use transaction under LC mode)

Operating Profit (Profit Before Interest, Tax, Depreciation)

97 = Gross Profit

- 55 = Operating Expenses

42 = PBITD


27/28


27

Profit Before Income Tax

42 = PBIT

- 03 = Interest

- 01 = Depreciation

38 = Profit Before Tax

NET PROFIT

38 = Profit Before Tax

- 11.4 = Tax (@ 30%)

26.6 = NET PROFIT

This is at the margin of 13.85% which is our target.


28/28


SALES & MARKETING:

For International marketing, we will participate in Trade Meet and organize a distributor meet in target

markets. We will also initiate Broker Incentive plan. We will give around 2% - 3% brokerage dependingon the value of the order.

MODE OF TRADE:

We will do business in D/A and LC mode of trade. We will not do business in D/P. We will target a profitof 10% to 15%. We will approach ECGC for insurance always to cover commercial and political risk.

ABOUT PRODUCT SOURCE:

We will purchase Buffalo Meat from different sources specifically near to our Cold Storage facility tominimize our transportation and administrative cost. This will help us in also minimizing our wastage.

FUTURE EXPANSION PLAN:

In the first year itself, we aim to target the revenue of Rs. 10 Crore. Within the next 5 years we will targeta revenue of Rs. 30 to 40 Crores. Also in the next 5 years, depending on our financial capabilities, wewill decide on opening our plant near Aurangabad / Satara. We aim to spend around 40% of our grossprofit for Sales and Marketing (including brokerage) for next 5 years to nurture the business.

IMPLEMENTATION SCHEDULE

We will start implementing this program from May 2014 onwards as we are start secondary researchand register our company from then we will start approaching the distributer of the target market for the

business purpose and simultaneously approach the banks for the fund.

Documents

International Marketing Final PDF