mgt 368- marketing plan

Kaynra

A Marketing Plan of Crab Fattening & Exporting

Prepared For:

Mir Semon HaiderSenior Lecturer

Course: MGT 368

Sec: 02

Prepared By:

Ahsan Uddin Sharif Omi

ID: 053 052 030

Muktadir Irtiza Miraj

ID: 053 353 030

Shahriar Rashid Rafi

ID: 053 049 030

Rockyb ul Hasan

ID: 061 508 030

Farzana Afroze Zerin

ID: 052 515 030

Sunday, April 15, 2008

Mr. Semon HaiderHonourable Instructor,

Course – MGT 368 (Entrepreneurship),

Section - 02, School of Business,

North South University, Bangladesh.

Dear Sir,

We would like to submit the project on the "Crab fattening & exporting". It is really an enormous opportunity for us to prepare this "Marketing Plan" project. We would like to recall with gratitude, the tremendous support and encouragement, which we received from you. We have tried our best to implement the relevant theories that you have taught in the course- MGT 368 (Entrepreneurship).

As an Instructor and Advisor to the report, you made critical reviews of various earlier reports, provided valuable insights and academic training to improve the quality of the work. We are grateful for your stimulating guidance and encouragement during the period of preparation this project. Without your guidance, this would simply not have been possible.

There may have many omissions and errors on our part but we have tried our level best to prepare this report to the required standard.

We are looking forward for your kind appraisal on this project.

Thanking you in anticipation,

Ahsan Uddin Sharif ( 053 052 030 ) Muktadir Irtiza Miraj ( 053 353 030 )

Shahriar Rashid ( 053 049 030 ) Rockyb ul Hasan ( 061 508 030 )

Farzana Afroze Zerin ( 052 515 030 )

Acknowledgement

We are indebted to many people for providing us encouragement and support during our learning and

working while making this project and we want to show our gratefulness to these people.

We are very much grateful to Mir Semon Haider, our respected course instructor of “

Entrepreneurship”, who assigned us this challenging project. He always guided us to take and overcome this

challenge successfully. Without his help in every step it was quite impossible for us to finish this project properly in

time.

At every moment we remember all of our classmates who really encouraged us in every stage of this

project with their support, encouragement and suggestions which really helped us a lot to make this project to be

successful. Without their guidance and friendly co-operation, this project would not be possible.

Also we are grateful to all the fellows who provided us with their utmost effort. Without their help it would

not have been at all possible. They have provided us with all the information and also supported us a lot.

Management Summary

Kaynra has identified some economical and industrial factors that will affect the marketing action during

this marketing plan period. Factors like, revenue earned, demand, competition have a positive impact on

the marketing action. On the other hand fluctuation of foreign exchange rate, government policy, trade

barriers have a negative impact. Kaynra has followed the geographical segmentation process to target

two regional segments for crab exporting they are , Asian market (1st segment), European market (2nd

segment). To serve these segments Kaynra depends on two permanent distributors. The 1st segment

which is Asian market is for mainly live crab because of the shorter distance and the high demand for

live crab. There are many traders who act as importer, purchase crab from us and supply these to Asian

countries like China, Japan, South Korea, Thailand e.g. The 2nd segment is which is European market is

for mostly for frozen crab. Most of the crab firm in the European country began to close because of

extreme cost. So the supply of crab is lower but the demand is increasing. To grab this opportunity we

have decide to export crab in the European countries in the up coming year. As a marketer of crab

industry where the number of potential customers is very large, Kaynra would not be able to predict the

accurate number of potential customers. Kaynra is looking forward to gain a sales volume of BDT

80500000 by the end of 4th year. In addition Kaynra is taking effective marketing action to raise its

market share from .95% to at least 1% in next year. From last three years experience Kaynra has found

that crab fattening and exporting is a very prospective business. Financial and other historical data

complement the trend analysis stated in previous sentence. Currently Kaynra has been facing an

extensive competition in local market. Kaynra mainly competes with firms that involve in breeding,

fattening and then exporting. Kaynra has a competitive advantage of mass fattening facilities which is

not available in other fattening firms. Kaynra is optimistic to enter to European market with this mass

production facility. Kaynra could expand its business in last few years more if it had not faced some

inhibiting problems like failing to manage new buyer, doing less effective advertising and promotional

activities, taking competitive pricing strategy. Besides Kaynra missed out some unrealized opportunities

for instance, it did not regularly take part in trade fairs and sea food festival, and did not take the

opportunity to meet the buyers physically. Kaynra has set a short term goal to export frozen crab in

European market and a long term goal to be largest exporter of frozen crab in European market from

Bangladesh. To accomplish these goals Kaynra has set specific objectives.

Economic Outlook

Kaynra has identified some crucial factors in the overall economy and industry which

will affect the marketing of crab in the plan period. As Kaynra has been a successful

exporter of mud crabs in South Asia and European countries, it has sufficient cash

inflows to stand in a sustainable state. Now, concerning the cash flow Kaynra has

earned, it can plunge into an effectual marketing action. Factors like, revenues earned

by exporting, foreign exchange rate, overseas trade barriers, government policy for the

industry, competition and demand will have a definite affect on marketing action of

Kaynra.

As far as the revenue is concerned, Kaynra has earned a sales amount of Tk. 79,380,000

in the last year. According to the business plan Kaynra had decided to spend a significant

amount which is 10% of the total sales per annum. So, the cost of marketing promotion

and advertising is heavily depended on the sales revenue. At the end of third year of our

business as we did project we are looking forward to spend Tk. 7,938,000 for

promotional purpose.

Foreign exchange rate has always been a vital aspect for the business people related

with abroad dealings. Foreign currency values remain in frequent fluctuations, so taking

any monetary decisions regarding even for marketing actions, it approaches prior to

knock. If any of the hard currencies oscillate a bit, many major financial resolutions halt

immediately. Kaynra’s one core commercial aspect is exporting crabs. So before

conducting any marketing action for imminent business activities, foreign exchange rate

should always be the aforementioned concern.

Trade restrictions in many countries vary time after time and it can be either positive or

negative for the cross border business associations. Considering Kaynra’s export

oriented operations, trade barrier may occur often among the countries that are the key

importers of crabs. As a result, the marketing plan we have prepared for those parts of

the world will not be successful.

Government policies for overseas business take always a crucial part. Like in crab

exporting business, government paid some tax holidays for the first three years which is

not going to be continued for further business years. This cut down in incentives will

raise the cost upwards. So it will have a negative impact on Kaynra’s marketing action.

Being a lucrative industry, crab fattening and exporting has always been attracting trade

people to be in it. So more and more competitors are coming up on the floor to possess

their share of profit. Though extensive competition is creating an unfavorable situation

for Kaynra, in other way it is positively Kaynra forcing Kaynra to come up with an

effective marketing action.

Demand being the most important economical factor has a greater impact on the crab

exporting business. It is a continuous process to be informed about the demand and be

on the try to meet up that. Demand determines different marketing strategy like push,

pull strategy and pricing strategy as well. Thus demand plays a significant role in

performing any marketing action.

The market---------qualitative

As Kaynra has followed the geographical segmentation process to target two regional segments

for crab exporting they are

Asian market (1st segment)

European market (2nd segment)

In order to serve these two segments Kaynra heavily relies on the local distributors for buying crablets

(180-200g) to fatten. Kaynra has two permanent distributors in Ghumatoli, Moheshkhali so far. They are

Allahar Dan Enterprise and Al Kaderia Hatchery. These two distributors have been involved in supplying

crablets for more than 6 years. They purchase the crablets from the local fishermen and distinguish

them as per their weight. Then they supply us the crablets that weigh 180-200g as per our requirement.

Our 1st segment which is Asian market is for both frozen and live crab because of the shorter

distance and the high demand for crab. There are many traders who act as importer of crabs in

different Asian countries where a huge number of potential buyers and consumers are waiting for

those delicious mud crabs. These importers purchase crabs from us and sell them to different

restaurants of Asian countries like China, South Korea, Hong Kong, Thailand, and Japan at a very higher

price. These importers search sellers of crabs through internet and other sources. As because there are

huge demand for crabs in Asian market every importer depends on several exporters.

Our 2nd segment which is European market is only for frozen crab. There are huge demands for frozen

crab because the longer distance people could not find the live crab. There are many crab firms in most

of the European countries but they began to close because of extreme cost. That’s why the supply of

crab is lower but the demand for crab remains constant. As a result the European countries are

demanding a large amount of frozen crabs from countries like Bangladesh where the crab industry is

growing very fast and reasonable price of crabs. European importers are highly conscious about the

quality of processing frozen crabs. In order to enter to the European market Kaynra will have to satisfy

their criteria to match the quality of crabs for what they demand for. Like the importers of 1st segment

the importers of European countries also depend on several exporters to satisfy their higher demand of

crabs.

Quantitative

As we have stated earlier Kaynra has a large of potential customers around the globe.

So it is not possible to mention the exact figure of potential customers or importers of crab. According to

our financial statement we have seen that at the end of third year of our business we have successfully

exported 113, 400kg crabs to different market that worth BDT 7, 93, 80,000. We are optimistic that by

implementing our new marketing plan the sales volume will increase to a extent which will worth BDT

80500000(approximate) by the end of 4th year. Currently Kaynra has a market share of 95% of total

market share. Our target is to expand current market share up to 1% of total market share by next year.

As per our marketing plan we would be able to export frozen crabs in European countries up coming

year. It will ultimately help our business to gain a higher market share as anticipated. Our current

competitive position is revealed in the “Competition” section of this marketing plan.

BDT 7541100000

BDT 79,380,000

Sales Volume

Total Sales Volume

Kaynra's Sales Volume

99.05%

0.95%

Market Share

Total Market ShareKaynra's Market Share

Fig: Showing Current Sales Volume

Fig: Showing Kaynra’s Market Share

Trend Analysis:

If we consider the past three successful business years of Kaynra we would find that it is heading

towards the right direction. The financial statement of last three years clearly show that the sales

revenue has significantly increased from BDT 39690000(of 1st year) to BDT 79380000(of 3rd year) along

with the increased sales volume from 56700kg(1st year) to 113400kg(3rd year). Crab has a great prospect

in terms of exporting to different markets of Asia and Europe. Kaynra expect to stand in a position by the

end of fourth year where it will not meet the demand of live crabs in Asia but also the high demand of

frozen crabs in Europe. The following chart shows the different historical data of last three years that

proclaim the success of Kaynra in crab industry so far.

Variables Year 1 Year 2 Year 3

Sales Volume 39,690,000 59,535,000 79,380,000

Production 56700 85050 113400

Profit 2124385 4051202 12138500

Market Share 0.25 0.55 0.95

Accounts Opened 2 4 5

Accounts Closed - 1 2

Table 1: historical data of Kaynra

Competition:

At the end of three successful years of business KAYNRA has many competitors in this

industry. In recent years many marketers have got themselves involve in this lucrative industry of crab

business. Generally three types of competitors are competing in this local industry. These three types

are breeding and exporting companies, only fattening and exporting companies and trading companies.

Companies who are involved in crab breeding and exporting are independent in terms of their

operation which starts from collecting mother crabs, hatching and fattening to exporting. They have

more competitive advantage than the other two types of competitors. They are more successful in this

business because the whole system is controlled and supervised by them in such a way that the quality

and the quantity remain up to standard. It is assumed that this type of company will expand their

business by increasing the production capacity during the coming year.

KAYNRA belongs to the category where the companies are involved in collecting crablets, fattening them

and exporting. The numbers of this type of company are larger than those of breeding and exporting

companies but fewer than those of trading companies. Companies like Kaynra who follows a very

scientific process of fattening have been extremely successful in this industry. These medium enterprises

are more focused on capitalizing their limited resources. It is expected that few of these companies

would go for breeding crablets like Kaynra will do in upcoming year.

A large number of companies are involved in trading which means only buying export quality crabs from

different firms and exporting them. Though, as per government regulation, each trader must have their

own farming plant, but in most cases, they are manipulating this regulation. These companies do not

involve in farming crablets. As a result they are highly dependent on crab farmers. They invest

comparatively a small amount and involve in less risk. They are also successful because they have been

involved for a long time. It is assumed that they might get involved in mass farming to ensure high

profitability.

KAYNRA has been concentrating on mass fattening of crabs in a scientific way. In last few years, only a

very few companies have successfully involved in mass production and fattening crabs by following

Kaynra. There are many fattening firms but they are not as big as Kaynra. When we started our fattening

plant with a land of 40 bigha then the second big plant was in a land of only 8 bigha in Satkhira, Khulna.

With a mass production of 113400 kg export quality mud crabs this year Kaynra has been one of the

most successful farm among the competitors. Kaynra has a competitive advantage over other

competitors in terms of exporting frozen crabs in different countries of Asia. In a very short time Kaynra

has been able to export frozen crabs with the help of BFDC. It has been possible because Kaynra had a

preplanning of exporting frozen crabs and it took necessary steps in the very initial stage, in fact, before

starting the business. Whereas others usually take the initiatives after doing the live crab exporting for a

few years. Here Kaynra has a definite advantage over other competitors who have entered the business

in last three years.

Problems and Opportunities

After three years of production Kaynra is facing some inhibiting problems and unrealized opportunities.

Among those problems first of all, our entire marketing manager failed to capture new market of crab. It

happens because they could not manage new buyers rather than the existing ones. Secondly, we

suffered from not having a separate marketing department which would only focus on advertising and

promotional activity. Thirdly the amplified numbers of competitors have caused the growing bargaining

power of the buyers. As a result we have to follow a competitive pricing. And after that geographical

distance with our buyers has enlarged the cost of our marketing communication. Lack of opportunity to

communicate face to face with our buyers.

Along with the opportunities Kaynra intend to take part in International Trade Fair and Sea Food Festival

outside of our country where we have prospects. After while Kaynra look forward to invite a few

permanent buyers from different countries to inspect the plant physically. Next Kaynra might have an

opportunity to sell its surplus amount of crabs to the local market. As we have to observe that there are

many expensive restaurants in Dhaka city where the increasing demand for crabs are widening market

opportunities for crabs.

Objectives and Goals:

Depending on the past and future possible success, Kaynra is going to set some

goals and objectives to have paced to meet them. Kaynra has an obvious scope

to reach the peak according to the goals and objectives through choosing the

projected path.

Short Term Goal

Europe is one of the highest demanding market for frozen crabs. So every crab

producer & exporter has the inherit expectation to plunge there to grab atleast

a portion of the market. Bangladesh frozen crab industry is still unable to get the

permit entering into EU market for insufficient quality. But Kaynra is promising

to provide best quality frozen crab and capture that demand into the eminence

supply frame.

Long Term Goal

Kaynra is projecting to state itself as the leading exporter of frozen crabs in

European countries from Bangladesh. After getting the permission for the frozen

export, many more competitors will raise their heads up for the trade. But

Kaynra, as the first mover to that market, will try utmost to maintain the throne

of market leader.

Short Term Objective

Qualitative

Europe holds a high demand for frozen crabs in an increasing order. To produce

or fatten crabs inside EU is immensely expensive. Continuous stoppage of

Europe’s local crab farms is the result for this scenario. So Kaynra has a vivid

prospect to stand in that situation and present itself as a probable exporter of

frozen crabs.

Kaynra will endow with customized size, packaging and labeling on the package

consistent with the demand informing from the importers of Europe.

Indisputably Kaynra will supply with the excellent quality frozen crabs as well as

the importers order.

Quantitative

Kaynra has gained sales revenue of Tk. 79,380,000 at the end of the third year of

business with 100% production. Now on the upcoming business year, Kaynra’s

projection is to earn Tk. 13,267,800 from only exporting frozen crabs inside the

EU border.

As Europe is one of the giant importers of frozen crabs among all other parts of

world, it is a lucrative market to possess a portion of that. Kaynra is planning to

grab atleast 1% of the total market share and sustain with that in its market

forecast.

European frozen crab market is highly profitable for all the exporters around the

world. As Kaynra is planning to be a part of that, so it will also face a handsome

amount of profit margin.

Long Term Objective

All other local exporter may follow Kaynra heading off to European market

getting along with the frozen crabs will create an extensive competition for the

survival. So Kaynra will break through this rivalry beating all the existing

competitors with the best quality and customized service for the importers.

Kaynra will form a department consisting expertise for specially exporting frozen

crabs to Europe. This branch will remain busy in assessing the demand of

European market for frozen market and find out innovative ways to serve.

Sun Mon Tue Wed Thu Fri Sat

1 2 3 4 5

6 7 8 9 10 11 12

Our crab farm layout

As the country’s first commercial crab producer, KAYNRA will produce crabs in a controlled process to ensure quality, both in size and health and supply them to the Global market. This business falls under the seafood industry. The company will be utilizing aquaculture technology to farm crabs. Full control over the process will allow production of quality crabs and supply at a competitive price. This will make The Company unique in producing disease free crabs in a standard size, which is the main requirement of the importers. KAYNRA is mainly targeting the Asian market comprising of Malaysia, Singapore, Taiwan, Hong Kong etc.

Plot# 8, Road# 12, Sec# 10,Uttara Model Town, Dhaka- 1230

To contact us:

Phone: (02)8916083-5Website: www.kaynra.org

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Kaynra


To- - - - -_ _

De Crab ParadisoK A Y N R A

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Kaynra is a partnership business company which came in crab industry three years earlier. Kaynra is the largest fattening farm consisting of self scientific facilities. Initially it started its business by exporting live crabs to Asian market. Now Kaynra is heading off to European countries with the best quality frozen crabs. Europe is one of the highest demand

ing market for frozen crabs. So every crab producer & exporter has the inherit expectation to plunge there to grab atleast a portion of the market. Bangladesh frozen crab industry is still unable to get the permit entering into EU market for insufficient quality. But Kaynra is promising to provide best quality frozen crab and capture that demand into the eminence supply frame.

Kaynra is projecting to state itself as the leading exporter of frozen crabs in European countries from Bangladesh. After getting the permission for the frozen export, many more competitors will raise their heads up for the trade. But Kaynra, as the first mover to that market, will try utmost to maintain the throne

Kaynra fattening process

Phone: (02)8916083-5Website: www.kaynra.org


Wishing you a progressive & eventful ‘New Year’ With regards

Kaynra

mgt 368- marketing plan

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