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MGT301 Principles of Marketing Assignment No 1 Fall 2012

Learning Objectives:
The prime objective of this activity is to get the student familiar with the business portfolio analysis tool created by Boston Consultant Group which is known as BCG matrix and its application.
Learning Outcomes:
1. Students will learn how BCG Matrix helps businesses to make better business portfolio analysis.
2. Students will be able to conduct business portfolio analysis of Gourmet and demonstrate the profitability of each SBU of Gourmet.
3. Students will be able to comprehend the analysis, decisions, and recommendations.
THE CASE:
Today the world has become a saturated market with thousands of products; supported by hundreds of strategies and initiated by millions of creative ideas. Now the subject matter of satisfying needs and wants has been reshaped with the creation of demand by providing innovative products with extra ordinary features/attributes. The markets with full of customers and conducive technological environment are inviting firms to expand their businesses for capturing a big pie of market share. The small as well as large corporations are expanding their businesses through SBUs (Strategic Business Units) to capture current market’s shares against competitors. Dealing in different markets with different products companies face the difficulties while investing in different SBUs. To knob this situation wisely, companies first need to analyze each SBU. Each SBU has a separate mission and objectives that can be planned independently. The SBU can be a company division, a product line within a division, or even a single product or brand. Furthermore companies should assess the attractiveness of its various SBUs and decide how much support each deserves. We have different models for designing and analyzing
the business portfolio planning but the best-known portfolio planning tool is the Boston Consulting Group (BCG) matrix. This model has been specifically developed for analyzing the current business situation of different SBUs of companies.
GOURMET is the largest food retail chain of Pakistan; founded in 1987 in Lahore and started its operations as a bakery and confectioner shop. It has diversified into a versatile food company over 25 years. It always focuses on customer’s need that’s why it is considered as the number one brand in the market due to its best quality products and valuable services. They are also expanding their business portfolio by introducing many other products (dairy products, beverages, traditional halwas, candy, toffee, jams, ice cream, ketchup, nimko) along with the existing products (Bakery and Mithai).
Some of its products have high market growth with high market share; some have high market share but with low market growth or high market growth with low market share while few are still far behind to achieve the higher level of customer’s satisfaction hence not successful yet.
REQUIREMENT:
You are required to analyze the business portfolio of the following gourmet products by using BCG Matrix:
1. Bakery
2. Water
3. Ice-cream
4. Milk
5. CSD (Gourmet cola)
6. Juices
NOTE: Your answer should be in;
1. Matrix form (As given below in Figure 1.1)
2. Provide justification for placing each product(s) in each quadrant i.e. Star, Cash cows, Question mark and Dogs
3. Each quadrant contains 4 marks: I mark for placing the product in right quadrant and 3 marks for justification.
Figure 1.1 BCG matrix for Suzuki Pakistan

ASSIGNMENT INSTRUCTIONS & GUIDELINES:
1. You are advised to visit the website of gourmet http://gourmetpakistan.com/.
2. Make a personal visit at any gourmet franchise if accessible otherwise use your personal contacts to get the information about all gourmet products.
3. Take help from internet for collecting the information.
4. Carefully watch Lecture # 06 and 07 and consult the recommended books.
5. Above matrix is just a sample; use the same pattern for solution.
6. Attempt the assignment by yourself and it will be entertained positively
7. Copied material from any source will be marked ZERO
8. Solution should be to the point and relevant
NOTE:
Assignment received after the due date will not be considered.

Solution:

Table # 01

Star (High Growth + High Share)

  • Bakery
Table # 03

Question Mark  (High Growth + Low Share)

  • Milk
  • CSD (Gourmet  Juices)
Table # 02

Cash Cow  (Low Growth + High Share)

  • Water
  • Ice Cream
Table # 04

Dog  (Low Growth + Low Share)

  • Juices

 

Reasons:

Table # 01: Bakery

In Lahore there is low competitor of bakery product. Only Butt Sweets are working in city but they are few. So Gourmet falls in star in context of bakery product. They need heavy investment to capture the market and get the high share.

 

Table # 02: Water, Ice Cream

In this situation, Gourmet need less investment and capture the high market share, because only one time investment made in filtration plant, then water will provided by gourmet.

 

Table # 03: Milk, CSD (Government Juices)

In Lahore, there is lot of milk shop. So Gourmet needs lot of cast to capture the market.

 

Table # 04: Juices

In Lahore juices are available, same quantity at same price at many shops. So if gourmet keeps these products. Then there is normal change, because people buy the same product at any shop nearest to home.

 

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