Shanto-Mariam University of creative technology

Program: MBA in Product & Fashion Merchandising.

Course: Name: Brand Management (MMBA-805)

Assignment

On

Compare a local brand with an international brand in similar product.

Prepare For:

Mr.Shah Waliul Manzoor

Lecturer of SMUCT

Department of MBA

Prepare By:

Md.Belal Uddin

ID: 142153024

4rd Semester

8thBatch

SMUCT

Introduction:

We are comparing two brand Nestle & Brac, Brands product are Nestlé‟s Powder Milk &

Aarong powder milk, Nestle is an international brand its product is Nido powder milk,

Brac is Bangladesh local brand its product is Aarong powder milk. We are comparing

two companies Mission, vision, strategy, marketing policy, Social Statement with

international brand to local brand.

About Nestlé

Nestlé S.A. is a Swiss transnational food and beverage company head quartered

in Vevey, Vaud, Switzerland. It is the largest food company in the world measured by

revenues, and ranked #72 on the Fortune Global 500 in 2014.

Nestlé‟s products include baby food, bottled water, breakfast

cereals, coffee and tea, confectionery, dairy products, cream, frozen, pet foods,

and snacks. Twenty-nine of Nestlé‟s brands have annual sales of over CHF1 billion

(aboutUS$1.1 billion), including Nespresso, Nescafé, Kit

Kat, Smarties, Nesquik, Stouffer‟s, Vittel, and Maggi. Nestlé has 447 factories, operates

in 194 countries, and employs around 339,000 people. It is one of the main

shareholders of L‟Oreal, the world‟s largest cosmetics company. \

Dairy

Dairy is the single biggest category for us in terms of volume, with 14.2 million tonnes of

fresh milk equivalent bought in 2014, through Farmer Connect and sourced from Tier 1

suppliers.

We use milk and milk derivatives as ingredients in a range of our products, including ice

cream, beverages, confectionery, infant nutrition and culinary products.

Nido

The brand offers a complete range of milk and milk-

based products that offer nutrition solutions for each

stage of childhood. The Nido brand is trusted by

mothers, with a taste that kids love. With its focus on

providing a nutritional foundation for growth and

development, Nido brand has been helping mums

around the world care for and nurture children for

the past 70 years.

Nido products feature instant dry whole milk with

Vitamins A & D. It is a good source of calcium to

help children develop and maintain healthy bones

and teeth.

Nido Kinder 1+ is non-fat powdered milk that is

fortified with Prebio 1, a prebiotic fibre that benefits a child‟s digestive system.

Our vision

DYNAMIC GLOBAL

NETWORK: Behind every Nestlé

product is a team of people committed

to creating safe products of the highest

quality.

People understand that food is a

source of nourishment and satisfaction,

but also pleasure, health, happiness

and peace of mind. They are

increasingly aware that their food and beverage choices can impact their quality of life

and affect the lives of others.

Innovation has been at the heart of our company since its beginning. Ever since Henri

Nestlé invented Farine Lactée to alleviate infant mortality, we have been dedicated to

enhance people‟s lives.

Each day we strive to make our products tastier and healthier choices that help

consumers care for themselves and their families. This would not be possible without

our unmatched R&D capability, nutrition science and passion for quality in everything

we do.

We have the largest R&D network of any food company in the world, with 34 R&D

facilities (3 Science & Research centres and 31 Product Technology Centres

and R&D centres worldwide), and over 5,000 people involved in R&D.

Behind every one of Nestlé‟s products there is a team of scientists, engineers,

nutritionists, designers, regulatory specialists and consumer care representatives

dedicated to earn our consumers‟ trust with safe products of the highest quality: at

Nestlé, safety and quality are non-negotiable.

Whether it is in terms of convenience, health or pleasure, we are able and committed to

create trustworthy products, systems and services that contribute to improving the

quality of consumers‟ lives.

Mission Statement

Our vision is to be the leading Food and Beverage Company in the Caribbean Region,

providing our customers with high quality products and services with added value at

competitive prices, simultaneously ensuring the long term viability and profitability of the

organization.

Our Mission demands that:

We are seen as a friendly, caring and efficient organization whose primary focus is on

providing consumers with safe and convenient high quality food products.

We are conscious of our role, as a leading corporate citizen, one which requires us at all

times to be in tune with and responsive to the social, environmental, economic and

cultural aspirations of the Caribbean people, whilst ensuring our shareholders a

reasonable return on their investment.

We are seen as an ideal place of employment with good working conditions and

benefits, with an internal environment in which our staff can achieve job satisfaction,

self-development and their reasonable aspirations.

We are viewed as a perfect example of an enlightened, innovative, modern Caribbean

corporation with progressive and dynamic leadership that is supported by highly

professional, committed, loyal and dedicated employees.

It is understood that in order for us to realize our vision we have to continue to strive to

earn the recognition and satisfy the trust our customers and business partners place in

Strategy

Our ambition is to be the world‟s leading Nutrition Health and Wellness company, and

the industry reference for financial performance, trusted by everyone.

For 150 years we have helped generations of people and pets live healthy, happy lives,

by providing innovative, science-based products and services that enhance their quality

of life, everywhere and every day.

Our success is due to our ability to anticipate the future and continuously adapt

ourselves to the opportunities it presents. Nestlé Roadmap to Good Food, Good Life

The Nestlé Strategic Roadmap is our compass, and it ensures that we take the right

direction to fulfil our goals. The roadmap shows the strengths we draw upon to drive

performance and deliver competitive advantage.

However, leadership in business is not just about size, it is also about behaviour. It is

our fundamental belief that to be successful over the long term we need to create value

for our shareholders, while at the same time creating value for society. We call

this Creating Shared Value.

This long-term view is framed by a robust set of principles and values that are based on

respect: respect for people, respect for the environment, and respect for the world we

live in. By following these we strive to meet the needs of people and pets today and

tomorrow.

Policies

Nestlé respects the environment, supports sustainable development and is committed

to environmentally sound business practices.

To fulfill this commitment, Nestlé:

Integrates environmental principles, programs and practices into each business;

Strives for the continuous improvement of its environmental performance through

application of the Nestlé Environmental Management System (NEMS);

Complies with applicable environmental legislation, Where non exist, Nestlé's own

internal rules are applied;

And Provides appropriate information, communication and training to build internal and

external understanding concerning the Company's environmental commitment

R&D

Research and Development is a key competitive advantage for Nestlé. Without our R&D

Nestlé could not have become the food industry leader in nutrition, health and wellness.

With 29 research, development and technology facilities worldwide, Nestlé has the

largest R&D network of any food company. Nestlé‟s research, development and

technology network, together with local market application groups, employs over 5,000

people.

Nestlé further strengthens its R&D capability through Innovation Partnerships at each

stage of the product development process – from early stage collaborations with startup

and biotech companies to late stage partnerships with its key suppliers.

By bringing together all of its global R&D resources, Nestlé is able to provide high

quality, safe food solutions for consumers worldwide – whether this is in terms of

nutrition, health, wellness, taste, texture or convenience. Above all, Nestlé brings to

consumers products that are of the highest quality. And safety is non-negotiable.

R&D is also critical in ensuring regulatory compliance of all Nestlé products. Nestlé is

able to launch new products quickly and efficiently, in countries all over the world, by

integrating regulatory affairs in all its R&D activities, from start to finish.

Nestlé scientists also play their part in communicating the health and wellness benefits

of products to consumers. Nestlé nutritionists world-wide work to ensure that all nutrition

communication, both on and off pack, is locally relevant, as well as scientifically sound.

Beyond sound nutrition, the future of foods will increasingly be driven by science. Nestlé

scientists are looking ahead to the foods of the future. Nestlé R&D is translating nutrition

and food science in two ways:

From consumer needs into research priorities, from emerging science into consumer

benefits, and services

The vision of Nestlé R&D is long term. A glimpse of how Nestlé R&D is helping to shape

the future of foods is provided through these internet pages.

Bringing life to milk

NUTRITIONALLY ENRICHED MILK PRODUCTS: Sri Lankan school children

enjoy Nespray, a locally-sourced, fortified, affordable milk product

Dairy products are considered to be a foundation of health for many cultures. At Nestlé,

we leverage the best of our science and product expertise to provide families with both

nutritionally enriched milk products and delicious dairy treats.

While our dairy products have many natural nutritional benefits, such as provision of

calcium, sometimes they need to do more. At Nestlé, we are proud to offer affordable

dairy products that also help to address local micronutrient deficiencies, particularly in

developing countries.

Addressing Micronutrient Deficiencies Through Affordable Milk

Micronutrient deficiency is a widespread problem, particularly in the developing world. It

has been estimated that micronutrient deficiencies account for more than 7% of the

global incidence of disease and, according to the World Health Organisation, around 1.5

million deaths a year can be attributed to a lack of iron and vitamin A.

Micronutrient malnutrition is most common in the developing world, where those on

lower incomes cannot afford to augment dietary staples, such as cereals, with more

micronutrient-rich meat, fish, poultry and eggs. However, milk is naturally rich in calcium

and a good carrier of micronutrient fortification, making it a viable, long-term way to

deliver more nutrition to large segments of the population.

The Nestlé range of children‟s milk brands (Nido, Ninho, Bear Brand, Klim, Ideal) have

been developed especially to offer the energy, protein and micronutrients needed by

growing children. To make these products accessible for lower-income groups, Nestlé

makes these milks available in affordable formats. These products are also fortified with

iron, zinc, vitamin A and other micronutrients as appropriate for the micronutrient

deficiencies prevalent in each area.

At the end of 2005, the affordable milk range was present in just five markets; today our

affordable fortified milks are present in more than 67 countries, making a positive

difference in the lives of children around the world.

Working with dairy farmers

MILK COLLECTION CENTRE: Nestlé buys fresh milk from some 40 000 Chinese

farmers and provides them with an overall regular income of around CHF 500 000 per

day, fostering rural sustainable development for the communities concerned.

At Nestlé, we strive to do more for the farmers and communities who supply us milk

through our Milk District Model.

The goodness of milk

Nutrition and wellness have always been at the core of Nestlé products, and milk has

always been an important part of this equation. Founded in 1866 in Switzerland, Nestlé

grew from two small companies producing milk-based products, into the world's

foremost nutrition, health and wellness company

Today, in terms of sales value, Nestlé is the world‟s largest milk company, sourcing

more than 12 million tonnes of fresh milk equivalents from more than 30 countries. We

purchase more than half of our milk locally as fresh milk (close to 7 million tonnes per

year).

Working with farmers

Nestlé works with more than 600 000 farmers – most of whom operate small farms – to

have a reliable, safe and high-quality milk supply.By adapting the Swiss Milk District

System to dairy farming in developing countries around the world, the Nestlé proven

and systematic approach is able to contribute to poverty reduction and improved

nutrition on a wide scale.

The Nestlé Milk District Model involves:

Milk collection centres featuring payment systems, quality and safety controls,

electronic weighing equipment and cooling tanks.

Free technical and animal husbandry support to improve milk quality.

Free veterinary services.

Transportation and infrastructure networks.

USD 25 million of microfinance loans each year.

Prompt payment to farmers for each milk delivery.

Benefiting many countries

The Nestlé experience in assisting farmers, creating Milk Districts and dairy industries is

evident in over 30 countries. Here is a sample of some of the community benefits from

Nestlé Milk Districts:

WOMEN'S DAIRY DEVELOPMENT PROGRAMME: The Village Women Development

Programme in Moga in northern India has trained 30 000 women dairy farmers.

China - Nearly 24 000 farmers in Heilongjiang, north-east China, deliver their fresh milk

to 78 milk collection centres. Nestlé invests nearly USD 200 million a year into the local

economy through milk payments, taxes, services and salaries.

Colombia - Nestlé is the third largest buyer of milk in Colombia where our two milk

districts produce 226 000 tonnes a year. We pay around USD 5 million a month to 4 000

local dairy farmers, and a further 10 000 people in the region work in the milk supply

chain as milkers, rural workers, transporters and traders.

Career development

At Nestlé, we know that it is our people who set us apart and spur our success year

after year. We‟re only able to hit our targets because they hit theirs. So we‟ve created a

high performance culture that puts the emphasis on diversity, innovation and growth

and this enables their development and ultimately ours.

As a professional, you‟ll find you have a wider sphere of influence and more freedom

than elsewhere. So you‟ll be able to broaden or deepen your existing job responsibilities

as well as having the opportunity to progress upwards.

There are three factors that will shape your career growth at Nestlé:

Core factors. These are non-negotiable; they are the qualities you must have if you‟re to

make the most of all the opportunities we have to offer. They include your sustainable

performance, the knowledge and skills you have about your function, the business and

yourself, plus your leadership skills and critical experience.

Accelerators. This is the name we give to the qualities that will determine how far and

how fast you progress and develop. These include your mobility, your flexibility to move

between functions and categories, how well you network and how open you are to new

experiences.

Opportunities

These are the factors that are more dependent on circumstances and activities

elsewhere in the business. Opportunities can spring from new roles, new positions and

new assignments overseas.

Talent Assessment and Succession Planning

Succession Planning is the way in which we plan career development and fill middle

and senior-level jobs. We are very methodical about how we plan this process. Nothing

is left to chance. Our succession plans cover all the key jobs in Nestlé and include a list

of forecasted potential successors for those roles. At any one time, we know exactly

how well these successors are performing and how close they are to taking on the next

role in their development.

Importantly, our succession plans are created with input from multiple sources. In other

words we take a very rounded view of development. We look at our employees‟ career

history and Talent Assessments, their Performance Evaluation results and other

relevant development data.

Revealing your potential

From experience, we know that to design high-quality development plans it is crucial to

apply the 70/20/10 model. This states that experienced-based activity has the highest

impact on professional and personal development, relationship-based approaches such

as feedback and coaching account for 20% of impact and formal training has the least

effect on how fully and quickly people develop. So with this in mind, we apply a variety

of learning approaches to bring the most out of your potential.

Our Corporate Mentoring Programme will help you to accelerate your development

through relationship-based support, transfer of experience, of key insights and unwritten

rules as well as bringing exposure to the areas beyond the current role.

Our International Training Centre in Switzerland will provide you with a variety of

programmes and courses to exchange knowledge and share ideas with colleagues from

other countries.

There is always an opportunity to deepen your expertise and develop leadership by

getting an international experience. We have over 2000 expatriates in some 96

countries. Together with other multinationals we have launched an exclusive network

that help dual career spouses with their local job search as well as professional

integration in a new country.

Nestle work life

Diversity

Diversity has only just reached the top of most corporate agendas, but at Nestlé it‟s

been the foundation of what we do for years. Strong, multi-cultural diversity has shaped

our success and culture. We work hard to integrate in every community to which we

belong – and we place the highest value on the unique perspectives that our people

bring us. We‟re open about the motivations behind this. Yes, we believe we have a

social responsibility to promote diversity, but equally we know it sharpens our

performance and gives us an advantage over our competitors.

One of the areas in which diversity makes the biggest difference is in the gender mix.

We‟ve made it a priority to make sure we‟re making the best of the talents of both men

and women. Again, this isn‟t simply because it‟s the right thing to do – it‟s also because

we‟ll only achieve our potential if all our people achieve theirs. So we‟re working hard to

develop an environment, culture and leadership approach that provides equal

opportunities for everyone, in every level.

Employee Health and Wellness

Our vision and values should shape everything we do. We believe strongly that they

should be lived and experienced every day. By providing our people with a healthy diet

and sporting activities, we support our principle of „healthy minds in healthy bodies,‟ and

create the healthy workforce that sets us apart.

With this in mind, most of our markets have implemented Employee Health & Wellness

Programmes that reflect the specific needs and expectations of their people. These

include weight management plans, disease prevention, daily childcare, flexible benefit

schemes and flexible work arrangements.

Safety and Health

Nestlé is founded on caring: for our consumers, for the communities to which we

belong, and, most fundamentally, for our colleagues. Not surprisingly, safety and health

is fundamental to everything we do. We don‟t accept compromises in this area. One

accident is one too many for us. The focus then is on finding new and more inspiring

ways of engaging everyone in the business with these issues and to build on the

success we‟ve already had. Our safety and health performance has improved

significantly, but we‟re committed to achieving zero accidents and that means we need

to lead the world in our thinking and practices.

We hope this gives you a good sense of our commitment to our people. For more

information about our performance in Diversity, Employee Health & Wellness, Safety

and Health and other people-related topics visit our Creating Shared Value page.

The challenge

Excelling here means sharing our passion for enhancing lives; it means taking

ownership of your future and remaining open to the unique learning opportunities that

will come your way. We encourage our people to view their career as a journey. There

are ongoing opportunities here to step up, broaden your exposure or deepen your skills.

Flexibility and the ability to take the long view are essential. But, rest assured, with over

2,000 leading brands and a passion for improvement, nothing stands still for long in

Nestlé – least of all talented young professionals.

BRAC Dairy & Food Project

Foundations

BRAC‟s microfinance programme used to enable farmers to buy land and cows in order

to produce milk. While BRAC helped these farmers to generate income through micro

financing, dairy farmers still did not have consistent access to the market. The demand

of milk in a single village was not enough to generate a hefty profit. A lot of milk lay to

waste because dairy farmers did not have enough demand to sell their milk and no

proper refrigeration to store the unsold milk. Sir Fazle Hasan Abed, founder of BRAC,

noticed this problem and proposed establishing a milk factory to collect milk from local

farmers for a fair price. As a result, BRAC initiated BRAC Dairy & Food Project (BDFP)

in 1998 to serve as a market for dairy farmers throughout rural Bangladesh.

Mission

BDFP‟s original mission was to grant farmers market access, ultimately helping them

generate income. Over time, BDFP‟s goals have expanded to serve high quality milk

product to their customers. With inconsistent electricity and therefore refrigeration, dairy

products generally are not widely available in Bangladesh. 85 percent of Bangladesh

still relies on the „informal‟ milk market which delivers bulk amounts of raw milk to

consumers. BDFP caters to the 15 percent of Bangladeshis who rely on the formal milk

market which sells processed and packaged milk. In essence, BDFP channels milk from

rural areas into urban areas while channelling urban money into rural areas.

Operations

There are a few steps in BDFP‟s operation. Currently, BRAC Dairy has one processing

factory in Gazipur, Bangladesh, but it has 101 chilling stations in the western half of

Bangladesh. As of now, BRAC Dairy collects milk from mainly western divisions of

Bangladesh: Khulna, Dhaka, Rajshahi, and Rangpur. However, BDFP mostly sells its

products in the eastern divisions of Bangladesh: Chittagong, Dhaka and Sylhet.

First in the supply chain, independent dealers purchase milk from dairy farmers for a fair

price. These dealers travel to one of BDFP‟s 101 chilling stations to sell and preserve

their milk. BDFP purchases the milk from dealers for a higher price than other dairy

retailers, allowing the dealers to continue giving farmers a fair price for their milk.

Finally, it processes the milk at its factory in Gazipur, where it produces numerous dairy

products, e.g. pasteurized liquid milk, UHT liquid milk, low fat liquid milk, chocolate milk,

mango milk, full cream milk powder, low fat milk powder, sour and sweet curd, ghee,

butter etc. These activities increase the market stability for dairy farmers and provide

high quality products to consumers in urban areas. A more stable market allows BDFP

to continue buying milk from dairy farmers for a fair price.

In 2012, BDFP has launched with a new brand named 'Aarong Dairy' for its all dairy

based products. BDFP distributes its milk based product via an internal and external

distribution chain. For the external sales, dealers (100 plus) purchase Aarong dairy

products and sell them to various retailers. BDFP also has its own sale centres in 35

places, forming an internal retail chain.

Growth

When BDFP first started, it produced 140,000 litres of milk per day. As of now, it has the

processing capacity of 170,000 litres of milk per day engaging 1500 employees. Today,

BDFP holds 22 percent of the national market share. It is also one of the largest BRAC

enterprises, making profits of over BDT 220 million.

Synergies with other BRAC enterprises

One of BDFP‟s goals is to provide a very high quality product. To enhance the quality of

milk, BRAC started its artificial insemination enterprise. This enterprise helps to

conceive the highest quality dairy cows. Artificial insemination adds value to BDFP‟s

final product, which allows BDFP to maintain a good price for its products and create

greater surplus. Over time, BDFP has expanded to provide training to farmers on how to

rear healthy dairy cows, providing vaccinations, nutritious feed, and other technical

training. Very recently, BRAC Salt launched a new product called Minamix for cows.

This product enhances the health of cows, contributing to higher quality milk production.

Clients

BDFP has three main groups of clients: dairy farmers, consumers, employees and

institution providers. Currently this enterprise serves roughly 40,000 farmers in western

part of Bangladesh. Consumers of Aarong dairy products benefit from high quality,

hygienic dairy products which BDFP produces.

BDFP‟s 1500 workers benefit from employment from the enterprise. Most of BDFP‟s

employees are skilled workers. Highly skilled veterinarians monitor the health of dairy

farmers‟ cows. BDFP also trains its workers on hygiene testing and quality control

measures. They also employ workers to procure milk from chilling stations, factory

engineers, marketers, and day labourers

Over View

The beginning

In 1978, BRAC‟s flagship social enterprise, Aarong, was created as a support

mechanism to BRAC‟s existing sericulture programme so that the hand-spun silk they

were creating could be successfully marketed at a larger scale. Aarong was established

as a retail distribution outlet that offered a fair price to the rural suppliers while

introducing the products to urban markets where both demand and consumers‟

willingness to pay were the highest. Today, Aarong has transformed into a high surplus

generating enterprise, operating as one of the largest retailers in Bangladesh. Other

BRAC enterprises also came into existence at various times in similar efforts to create

economic space for the poor. Although most of the BRAC enterprises were formed as

programme support enterprises, majority of them currently operate as surplus

generating ventures while maintaining their ongoing commitment toward alleviation of

poverty via empowerment of the poor. Today BRAC operates 16 financially and socially

profitable enterprises, across health, agriculture, livestock, fisheries, education, green

energy and retail sectors, making significant contribution to local economy through

creation of market linkages, entrepreneurs and employment opportunities. By targeting

profitable and scalable businesses, BRAC enterprises are able to fullfill their social

missions at a much greater scale while increasing financial surplus that reduce the

organisation‟s donor dependency and support BRAC‟s development programmes and

other innovations at a greater level. That is why BRAC enterprises continue to exist,

expand and innovate through across multiple sectors.

The BRAC ethos of social entrepreneurship, the '3Ps': people, planet, profit

BRAC Enterprises strive to strike the right balance between financial surplus and social

returns in order to achieve the targeted double/triple bottom lines. By operating as a

surplus generating organisation that aims to alleviate poverty through its business

operations and supply chain, BRAC succeeds in implementing its vision to serve society

in a profitable manner.

Although all of the BRAC enterprises are committed toward achieving financial, social

and environmental returns, BRAC takes a unique approach in defining its triple bottom

line by focusing on three ideals: people, profit and the planet (the '3Ps'). A BRAC

enterprise must meet three criteria in order to be considered a successful and

sustainable business:

It must serve the needs of poor people

It must be environmentally friendly, and

It must make surplus to help keep BRAC‟s development works sustainable

Social enterprise – our objective

BRAC takes a holistic approach in conceptualising and developing each of its

enterprises. As BRAC enterprises have expanded from programme support

mechanisms to surplus generating enterprises with financial and social missions, each

enterprise has ensured that it complies the four fundamental objectives of a BRAC

enterprise:

Creating job opportunities

Generating surplus for BRAC in order to minimise donor dependency

Ensuring long-term support and contribution toward the sustainability of BRAC‟s

development interventions such as microfinance, education and skills development etc.

Becoming viable investments in the long run in order to act as „hedge‟ against future

liquidity, Advantages gained from social enterprises

through its unique model and integrated operations, BRAC achieves five distinctive

advantages across its enterprises:

Synergy

The integrated network of BRAC Enterprises, Development Programmes and

Investments together beget a unique synergy and essentially create a 2 2=5 Effect. The

surpluses generated by the social enterprises make BRAC more self-sustaining so that

increasing numbers of poor people can become self-reliant.

Cross collaboration

BRAC enterprises maximise synergy, impact and value by their targeted outreach and

integrative products and services across multiple enterprises.

Cross subsidy

Although BRAC enterprises aim for financial returns while fulfilling the social and

environmental missions, not all enterprises are equally profitable. The cumulative

surplus from BRAC enterprises combined are used to re-invest in the BRAC enterprises

and support the development programmes, on an as needed basis, not on a pro-rata

basis across enterprises.

Continuous innovation

BRAC‟s extensive network of enterprises with the capacity to address major social

needs allows BRAC to continually identify needs and create innovative solution to fulfil

that need and create necessary market linkages.

Holistic support

Because of its integrated network and unique model, BRAC has the advantage, ability

and capacity to provide holistic support and truly take care of its stakeholders, i.e. the

entrepreneurs involved with the BRAC enterprises.

Aarong milk

Aarong Milk was first marketed in 1998 by the dairy social enterprise of development

organization BRAC, to help po or rural dairy farmers protect and grow their dairy

enterprises and improve their family's income by facilitating ac ces s to urban markets. I

nspired by this purpose, Aarong Milk has worked to build a brand that is as true to its

urban consumers as it is to its rural suppliers, providing dairy products of impec cable

quality that drive its vision of a healthy and strong Bangladesh

Market

Aarong Milk is a well-known, highly respected and trusted brand among urban

Bangladeshis. This trust is based on Aarong Milk's meticulous attention to quality

control in all aspects of the production process. Consumers have come to rely on the

high quality and value of its products. Having entered Bangladesh's dairy market only

12 years ago, Aarong Milk has achieved enormous success with its biggest selling

product, liquid milk, capturing 32% market share - second only to a long-standing

national competitor. Aarong Milk is a market leader in other products: in flavored milk, it

captured 58% of the market in just 10 years while its curd product dominates nearly

70% of the curd market and ghee leads with a 34% market share.

Achievements

Aarong Milk offers a range of dairy products alongside liquid milk and competes with

wellestablished global brands in the Bangladeshi powdered milk market. Its greatest

achievement has been in winning the confidence of the consumers in a short period of

time. This is reflected in the rapid increase in market share - Aarong Milk gained 13%

market share during the last 4 years, from 19% in 2006 to 32% in 2010. The brand has

a dedicated consumer base of around 500,000 people who regularly purchase its

products. Aarong Milk is also playing a major role in the development of the country's

dairy industry infrastructure and technology, through its network of chilling centres

collecting milk from the remotest rural areas, the use of state-of-the-art processing

History 1999 Ghee and low-fat milk products launched 1998 Commercial operations

started with the launching of liquid milk product 2000 Flavored milk products introduced

in poly-pack 2001 Production of UHT milk started 2006 Production capacity of liquid

milk increased 2008 Branded powdered milk product introduced equipment and

research into and promotion of improved livestock breeding, rearing and caring

techniques. Aarong Milk is currently supporting over 40,000 farmers, helping develop

rural entrepreneurship through loans providing access to improved breeds through

BRAC's Artificial Insemination programme, high quality feed produced by BRAC's feed

enterprise and veterinary services through its extension networks.

Product

Aarong Milk offers a range of high-quality dairy products for the urban market. Essential

nutritional value products include liquid, UHT and powdered milk and butter. Products

targeted towards the health conscious are low-fat milk, curd and strawberry-flavored

yogurt drink. The strawberry drink is a unique Aarong Milk product not produced by any

other company in Bangladesh, as is Tamarind Juice, made using its own private recipe.

Alongside packaged juices, the chocolate and mango flavored milk products are for the

young and the young at heart and aim to make drinking milk fun. Products such as ghee

are primarily marketed as ingredients in festival-related food.

Recent developments

In 2008, Aarong Milk added a new product to its product line - Aarong Full Cream Milk

Powder, an essential addition to the milk market providing pure milk directly collected

from local cattle and processed using state-of-the-art technology. Bangladesh is

currently importing over 25 thousand metric tons of powdered milk to meet market

demand. Aarong Milk Powder aims to play a significant role in this regard, helping to

reduce import dependency in addition to encouraging more poor farmers to enter into

the dairy sector.

Promotion

The latest in Aarong Milk's promotional activities is the "Bolishtho Bangladesh Gorbo-i"

campaign. Inspired by the positive "can-do" attitude towards taking Bangladesh further

that is prevailing across all sectors, the campaign highlights Aarong Milk's commitment

towards creating a strong Bangladesh by producing the highest quality of pure milk that

will work to develop the physical and mental strength of Bangladeshis. The campaign is

being put forth across all standard promotional channels for Aarong Milk, including

billboards, TV, print media and POS displays. New channels being utilized by the

campaign include mobile billboards and radio.

Brand value

Aarong Milk is dedicated to delivering the highest quality dairy products to its

consumers and in reflection - the brand has become synonymous with quality and good

health in consumers' minds. Aarong Milk's commitment to build a healthy Bangladesh is

double-edged. It is focused on establishing the importance of milk as an integral part of

a healthy diet for its consumers. Aarong Milk is also committed to ensuring the health

and wellbeing of its rural suppliers and their families by improving their income through

provision of market access as well as encou

Where are works

AARONG MILK A Social Statement by itself

Sabina must have realised very early on during her childhood that her life

was going to be no walk in the park. Born unto a world of poverty, Sabina

hardly ever had a childhood to begin with.

Dropping out of school at Grade-7, she found herself married off at only 14

years of age. Two kids later, Sabina and her day-labourer husband

reached a point where they literally did not have enough money to survive.

As the closest milk collection point was far away from the community, it

was tough for the producers to sell their milk and get a fair price. Sabina

offered her help in this regard and since then, she has not looked back.

Sabina began with collecting and selling 10-15 litres of milk and has now

gone on to selling 45-50 litres of milk per day. Along with this, she has also

started a small cattle feed business to augment her income.

With a little help, Sabina climbed out of the unforgiving grip of poverty and

now she uses her income to meet day to day expenditures along with

planning a better future for her children.

Like Sabina, many others have benefitted from an industry that once faced

many challenges. Previously, the dairy industry suffered greatly from a lack

of established linkage between production, distribution and consumption.

Dairy farmers were not receiving fare prices and the breeds of cow in their

farms would produce low quantities of milk. Then in 1998, BRAC Dairy was

established to help dairy farmers overcome these problems.

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What started as a social business soon became a brand, Aarong Dairy, to

be reckoned with, one which soon gained the trust and respect that few

business manage to gather. However, Aarong Dairy's reputation wasn't

based just on the quality of their product but also the story present in every

packet. For buying Aarong Dairy is akin to directly supporting a community,

which is in need of our support. Aarong Dairy then, is a social statement all

by itself.

During its infancy, Aarong Dairy found that though there were plenty of

locals involved in the milk trade, they could not find a permanent market. In

fact, at times they found that there was hardly any demand or the demand

was too erratic to be profitable for them. Low quantities of milk produced by

their cows also meant that milk production was an expensive process. Poor

breeding, limited veterinary services and shortages in cow feed were some

of the other challenges face by dairy farmers.

Aarong Dairy identified the problems in the sectors and then began to find

ways to rectify them. The first order of business was to establish both

forward and backward linkages in terms of milk production.

In fact, although Aarong Dairy itself was established in 1998, its origins can

be traced much further back, in the early 1980's, when the BRAC micro

finance program aimed to provide funds for ultra-poor farmers to procure

cows and invest in cows. Subsequently, BRAC's artificial insemination

program also came into play, and successfully helped farmers rear breeds

of cows that significantly increased their milk yields.

Having helped increase production of milk, BRAC now needed to ensure

market access for its farmers at a fair price. This is where Aarong Dairy fits

in.

The organisation began buying the milk that the farmers could produce at

very competitive prices. Because of Aarong Dairy's presence, the local

farmers could finally have guaranteed payments based on their individual

level and quality of production. This was a huge incentive.

Aarong Dairy thus removed the major headaches for the farmers such as

where to store to the milk and how to transport the milk. Aarong Dairy has

gone on to set up 101 chilling plants, with 10 plants set up in the Northern

region, where milk production is low due to unfavourable climactic

conditions. However, Aarong Dairy had no plans to leave any farmer

behind, so the Northern region was included despite the problems.

Furthermore, it was not just the milk producers who benefitted. As Sabina's

story shows, milk collectors were even benefitted and so were those who

were involved in the production of cattle feed.

Along with milk producers, peripheral industries and ancillary services also

were advantaged greatly. Entire villages could be seen transforming,

freeing themselves from the shackles of poverty.

However, bringing in milk from all corners of the country, did throw up a

dilemma of its own. Milk from each region is unique in its qualities and even

taste. To ensure uniformity in all their milk products, Aarong Dairy instituted

a three-step test. These tests help to establish the homogeneity of the

products, so all the products are the same. The powder milk that Aarong

Milk produces is also entirely locally sourced.

Currently, Aarong Dairy has 101 collection and chilling stations located in

25 districts, including 10 located in ultra-poor areas. The enterprise collects

102,559 litres milk daily and serves 50,000 farmers, 64 percent being

women. More than 2 packets of Aarong milk are produced every 2

seconds.

Aarong Dairy, has come quite far in a short span of time given their

ambitions. They have carved a niche for themselves not only for

consumers but also for the producers. In fact, Aarong Dairy is a social

enterprise. The primary objective is not necessarily to become a market

leader, but help create market access for our dairy farmers, and ensure a

fair price for them.

Nothing in terms of quality or even ethics is compromised. Aarong Dairy

isn't just a product; it's a social statement or rather a powerful business

statement that helped not only to preserve but also revitalise an entire

industry.

Next time you purchase a packet of Aarong Milk, remember that you are

not only purchasing something with nutritional value but rather you are

directly responsible for preserving and ensuring the very livelihood of over

50,000 farmers.

Marketing Mix – The 4 p’s of marketing

The Marketing mix is a set of four decisions which needs to be taken before launching

any new product. These variables are also known as the 4 P‟s of marketing. These four

variables help the firm in making strategic decisions necessary for the smooth running

of any product / organization. These variables are

Product

Price

Place

Promotions

The Marketing mix of Nestle discusses the 4P‟s of one of the strong FMCG companies

of the world. The Nestle marketing mix shows Nestle has a strong product line which

boosts its marketing mix. Below are the products, price, placement and promotions of

Nestle.

Products: Milk and Milk products – Nestle every day, Nestle slim and Nestle Milk maid are some

of the milk and milk based products from the house of Nestle. Nestle powder milk is

Nido, Nido is Powder milk, NIDO® FORTIFICADA is dry whole milk with added vitamins

and minerals to help support healthy growth and development. Every 8 fl oz glass of

NIDO® FORTIFICADA milk has:

20% of the Daily Value* of Vitamin C

30% of the Daily Value* of Iron

30% of the Daily Value* of Calcium

*% Daily Values based on children less than 4 years old. NIDO® FORTIFICADA is not

suitable for children under 1 year of age.

Price: Nido have various size and price of powder milk

Placement – Nestle follows the FMCG strategy of distribution which involves breaking

the bulk. The typical distribution strategy of Nestle is as follows.

Manufacturing >> C & F agent >> Distributors >> Retailers >> Consumer

Manufacturing >> Bulk buyers >> Consumer

These are the two different forms of distribution which Nestle has. It is typical of any

FMCG company. However, the Nestle channel is known to be strong with a good

marketing and sales network for channel distribution.

On top of it, Nestle regularly introduces trade discounts and various tactics to keep the

channel motivated. The major challenge is in the distribution of Maggi which is the most

in-demand product along with Nescafe. Due to these two products, Nestle is able to

drive other products in the market as well. Thus, on purchase of one weak product, the

distributor might get a discount on the stronger product or vice versa.

The challenge for Nestle is in the chocolate segment where it faces stiff competition

from Cadbury and hence selling the chocolates becomes difficult. Kitkat might have its

own brand positioning, but it is not better than Dairy milk. Thus, converting retailers to

sell Nestle instead of Cadbury is the toughest task for Nestle. This is converted mainly

through promotions.

Promotions

Communication and Promotion Dhaka (%

)

Narayangong(%

)

Communication media she

uses frequently

Television 48.0 52.0

Radio 22.0 24.0

Newspaper 30.0 24.0

Magazine 48.0 52.0

Where she has watched a

NIDO Advertisement

Television 54.0 50.0

Newspape

r

24.0 24.0

Magazine 22.0 26.0

This is another vital part for the marketers. These sections were to find out the

communication channels they are using. In this regard also, we have found that

mothers from both the localities rely upon television more than any other medias. As a

result, the marketers should communicate through this channel, as it will cover most

people.

NIDO is reliable and will always find ways to satisfy the nutritional needs of growing

children. It has been in the family for generations and has always symbolized the

guarantee of constant premium quality.

Most of the Consumers from both the locality told that they have chosen this particular

brand as they think that this is the best FCMP in the market. A handsome portion of

the consumers from Dhaka told that they have chosen this brand as their kids like

other brand of milk powder. But the consumers from Narayangong said that they have

chosen this brand as it has the highest quality and they are also able to afford the

price of it.

Nido faces direct competition with the ordinary milk and milk based beverages like

Complan, Bournvita and the like. NIDO takes the differentiation from other milk

brands by essential nutrients that growing children needs (comparison with nutrients

of Complan).

Marketing Strategy for NIDO is good for different segments of marketing areas mainly

due to price stability, aggressive media and non-media activities.

NIDO is trying to grab the full cream powder market of Bangladesh in both cities and

rural areas.

In case of the knowledge about various things of full cream milk powder, the

consumers from Dhaka were more knowledgeable than the Narayangong consumers

as they were a bit more correct in picking up the right answers.

Sometimes Nestle create artificial shortage of supply of NIDO to increase the price

of milk for that customers sometimes deprive NIDO and switch to others brand which

results fall down their market position.

Trade Promotions

An annual Trade contest has been held for the last two years running in the form of a

Display Contest. The contest is very simple. Retailers are given points based on product

purchase, shelf display, POP advertisement maintenance and additional creativity in

display. The program obviously runs for a specific duration of time, usually 2 months. At

the end of the promotion period, retailers with most number of points within their

stipulated territory are given cash prizes.

Push Money

During this trade promotion, cash discounts are given to traders when they purchase a

specified minimum number of products within a given time. In the case of NIDO,

discounts are given when traders purchase certain number of cartoons of NIDO. (Ex: a

carton of NIDO 350g contains 24 packs).

Complementary Gifts

In order to build better relationships with the trader‟s gift items such NIDO branded

clocks, caps and t-shirts, bags etc. are given out.

Consumer Promotions

The specific objectives of consumer promotions for NIDO include increasing short-

term sales, creating hype among consumers and build brand equity through

association of brand positioning and promotion theme. In the case of NIDO, usually

premium based consumer promotions have been used. In 2005, only one consumer

promotion was run with title “Growth Kit”. The concept of this CP was very simple.

Consumer got a free Growth Kit set, which included a height sticker, NIDO mug and

nutritional booklet for mothers with purchase of one NIDO 350g pack. The promotion

also helped build NIDO associations with the concept “growth of children” because the

gifts were directly related with the concept. Similarly, in the previous year similar

consumer promotion was run with free gifts of “Stationery set for children” and “Faber

castle crayon set” for children.

Sales Promotion

Sales promotion, offers and extra incentive for the ultimate consumer, distributors, or

the sales force.Here we are only concerned with consumer-oriented sales promotion.

Sales promotional techniques used by nestle Pvt. Ltd.

Event Marketing & Sponsorships

From time to time, NIDO does engage in event marketing and sponsorships.

However, they do have to be related to the brand‟s positioning and targets

consumers. For example, in 2006 NIDO sponsored a children‟s art exhibition,

science fair for young children in schools. NIDO also co-organizes an annual story

writing competition for children with the title “NIDO Shaptahik 2000-Golpo Lekho

Golpo Jeto”. This competition is conducted through out the country in almost 10,000

schools.

Publicity

NIDO organizes nutrition based educational programs in schools for mothers with the

aim of providing information and knowledge to mothers on how best to take care of

the nutritional needs of children and what role milk plays in respect of their nutritional

needs. The programs titled, “NIDO Growth Program” was conducted in over 150

schools last year and will be conducted in more schools this ye

Consumer Confidence

The Consumer Confidence department is the scientific heart of the Nestlé

Quality System. Consumer confidence and trust has been fundamental to Nestlé‟s

success for over 135 years. Our wide range of expertise is made available to R&D

scientists, operational and technical units and businesses. We cover five main areas.

Consumer safety that guarantees the delivery of safe products.

Product compliance that combines all aspects related to the legal compliance of

Nestlé products.

Consistent quality that involves all measures for the delivery of Nestlé products

with a consistent level of quality.

Consumer preference that ensures our products demonstrates superior

organoleptic and nutritional quality.

Occupational and environmental safety that combines all aspects related to the

safety of workers and the environment

Safety evaluation requires extensive scientific skills in the two areas of food safety:

analytical method development and science-based risk assessment. Ingredients also

need to be analyzed for authenticity and allergens. Leading edge packaging

expertise also has a role to play in ensuring both quality and safety of Nestlé food

products.

Anticipation of food safety issues is guaranteed through a systematic screening of

scientific and technical literature and evaluation by our network of experts for case-

adapted responses.

Market Position of NIDO (Dhaka)

One of the prime targets of this research was to find out the NIDO information. As the

market is so much competitive and some of the companies are so much

concentrated about Niche marketing, they always need to know who are their

customers, what they are wanting from a particular brand, what are their likings and

disliking etc. This is truer in case of NIDO as it is always focused on the demands of

its consumers. So at the beginning of the survey, I wanted some of the NIDO

information such as their occupation, age, education level, gross family income etc.

Marketing Mix of Aarong:

Product: Aarong Milk offers a range of high-quality dairy products for the urban market.

Essential nutritional value products include liquid, UHT and powdered milk and butter.

Products targeted towards the health conscious are low-fat milk, curd and strawberry-

flavored yogurt drink. The strawberry drink is a unique Aarong Milk product not

produced by any other company in Bangladesh, as is Tamarind Juice, made using its

own private recipe. Alongside packaged juices, the chocolate and mango flavored milk

products are for the young and the young at heart and aim to make drinking milk fun.

Products such as ghee are primarily marketed as ingredients in festival-related food.

Price: Aarong have various size and price of powder milk

AARONG DAIRY L F MILK POWDER BIB 350GM Tk.275.00

Place: Selling place of Aarong powder milk in Bangladesh local market, supper shop,

Promotion: the current market situation, position, segmentation, SWOT analysis and

marketing mix is described here along with the history and background of Aarong dairy

company. I have analyzed the customer behaviour and current market situation of

Aarong dairy by using secondary data as there was limitation to gather primary data

because of the current political turmoil.

Introduction

BRAC‟s microfinance program used to enable farmers to buy land and cows in order to

produce milk. While BRAC helped these farmers to generate income through micro

financing, dairy farmers still did not have consistent access to the market. The demand

of milk in a single village was not enough to generate a hefty profit. A lot of milk wasted

because dairy farmers did not have enough demand to sell their milk and no proper

refrigeration to store the unsold milk. Sir Fazle Hasan Abed, founder of BRAC, noticed

this problem and proposed establishing a milk factory to collect milk from local farmers

for a fair price. As a result, BRAC initiated BRAC Dairy & Food Project (BDFP, also

known as Aarong dairy) in 1998 to serve as a market for dairy farmers throughout rural

Bangladesh. Today, Aarong Dairy not only secures fair prices for its rural entrepreneurs,

but has also expanded to offer cattle development and technical training, vaccinations

and feed cultivation facilities. Aarong Dairy collects milk from 100 collection and chilling

stations located across the country including 10 that are located in ultra-poor

areas. Aarong Dairy is currently the only dairy company in Bangladesh to have

received ISO 22000 Certification, setting an example of vigilance at every stage of dairy

production,

Operations

There are a few steps in BDFP‟s operation. Currently, BRAC Dairy has one processing

factory in Gazipur, Bangladesh, but it has 101 chilling stations in the western half of

Bangladesh. As of now, BRAC Dairy collects milk from mainly western divisions of

Bangladesh: Khulna, Dhaka, Rajshahi, and Rangpur. However, BDFP mostly sells its

products in the eastern divisions of Bangladesh: Chittagong, Dhaka and Sylhet.

First in the supply chain, independent dealers purchase milk from dairy farmers for a fair

price. These dealers travel to one of BDFP‟s 101 chilling stations to sell and preserve

their milk. BDFP purchases the milk from dealers for a higher price than other dairy

retailers, allowing the dealers to continue giving farmers a fair price for their milk.

Finally, it processes the milk at its factory in Gazipur, where it produces numerous dairy

products, e.g. pasteurized liquid milk, UHT liquid milk, low fat liquid milk, chocolate milk,

mango milk, full cream milk powder, low fat milk powder, sour and sweet curd, ghee,

butter etc. These activities increase the market stability for dairy farmers and provide

high quality products to consumers in urban areas. A more stable market allows BDFP

to continue buying milk from dairy farmers for a fair price.

In 2012, BDFP has launched with a new brand named 'Aarong Dairy' for its all dairy

based products. BDFP distributes its milk based product via an internal and external

distribution chain. For the external sales, dealers (100 plus) purchase Aarong dairy

products and sell them to various retailers. BDFP also has its own sale centres in 35

places, forming an internal retail chain.

Growth

When BDFP first started, it produced 140,000 litres of milk per day. As of now, it has the

processing capacity of 170,000 litres of milk per day engaging 1500 employees. Today,

BDFP holds 22 percent of the national market share. It is also one of the largest BRAC

enterprises, making profits of over BDT 220 million.

Synergies with other BRAC enterprises

One of BDFP‟s goals is to provide a very high quality product. To enhance the quality of

milk, BRAC started its artificial insemination enterprise. This enterprise helps to

conceive the highest quality dairy cows. Artificial insemination adds value to BDFP‟s

final product, which allows BDFP to maintain a good price for its products and create

greater surplus. Over time, BDFP has expanded to provide training to farmers on how to

rear healthy dairy cows, providing vaccinations, nutritious feed, and other technical

training. Very recently, BRAC Salt launched a new product called Minamix for cows.

This product enhances the health of cows, contributing to higher quality milk production.

Clients

BDFP has three main groups of clients: dairy farmers, consumers, employees and

institution providers. Currently this enterprise serves roughly 40,000 farmers in western

part of Bangladesh. Consumers of Aarong dairy products benefit from high quality,

hygienic dairy products which BDFP produces.

BDFP‟s 1500 workers benefit from employment from the enterprise. Most of BDFP‟s

employees are skilled workers. Highly skilled veterinarians monitor the health of dairy

farmers‟ cows. BDFP also trains its workers on hygiene testing and quality control

measures. They also employ workers to procure milk from chilling stations, factory

engineers, marketers, and day labourers.

Thanks Sir