Part I:• An overview of Chocolate & Confectionery

Industry of Pakistan

Part II:• Practical aspects of sales & distribution of

FMCG

Branded Chocolate and Confectionery Industry of Pakistan

2009

www.saifdewan.wordpress.comVia Google - Chocolate and

Confectionery Pakistan

Chocolate & Confectionery - Pakistan

• Chocolate and Confectionery Industry – An overview

• Close estimates of sales turnover- major players

• Characteristics, Distribution & Selling Strategy• Channels’ Margin• Popular Brands and Price points• Drivers, Challenges and trends

Overview of Industry• Enjoyed an emerging and growing trend in recent past• Yet its size and growth pattern is inconsequential to

Asia-pacific region• Average annual growth rate 6.5% to 7.5% during 2002-

2008.• Domestic brands dominates accounting for more than

85% market share.• Split into organized (branded) sector and un-organized

(generic) sector.• Branded sector – monopolistic in nature , with 9-10

prominent and active players• 80% industry share – being enjoyed by 5 players

Estimated Market Share % Company Major product

linesMajor Brands Estimated annual

turn-over PKREstimated Share %

Hilal Bubble, Candies, Jellies, Beans, Powdered Drinks

Ding Dong, Fresh up, Tulsi, Kopra, Limopani

Over 3.5 billion (only Choc. & Conf.)

26%

Ismail Industries Jellies, Candies, Chocolates, Lollypops, Biscuit & Snacks

Chilimili, Fanty, Now, Paradise, Bisconi & Snaccity

Over 2.8 billion(only Choc. & Conf.)

21%

B.P Sweets Jellies, Candies, Lolly Pops, Chocolates, Biscuits

Spacer, Dolphin, B.P Lollies, Dream Chocolate

1.7 billion 13%

Cadbury’s Chocolates (Countline & Moulded), Toffees, Chewable Mint candies

Dairy Milk, Velvet, Éclairs, Softmint

Over 1.5 billion 11%

Estimated Market Share %Company Major product lines Major Brands Estimated annual

turn-over PKREstimated Share %

Kidco* Bubbles, Candies, Lollypops, Chocolates

4ever, Centro, Punch Candy, Lollies, Cox

1.2 billion 9%

Mayfair Candies, Toffees, Bubble

Creamers, Tiger Bubble, Amrood candy, Café biscuit

0.8 billion 6%

Mitchell’s (only Chocolate and Confectionery)

Groceries( squashes, Jams , Jellies , Marmalades, Sauces, Moulded & Countline , Toffees & Candies

Milk Toffee, Fruit Bon Bon, Jubilee, Golden Hearts, Festival

0.70 billion 5%

DanPak Bubble Gum, Lollypops, Candies

Chini mini, Fresh ‘ O bubble, Choco Bisco, Milko sip

0.70 billion 5%

Sweet Hills Candies, Toffees Dr. Milk, NutKut, Love Candy, Cow

0.5 billion 4%

Total 13.4 Billion PKR

Characteristics:• Highly Price elastic• Bulk of sales concentrated in mid-price range products• Urban markets account for major share and also for a higher

penetration rate.• Price point range:

Chocolates 3-25 PKRSugar Confectionery 0.50-2.0 PPKR

• Coin barrier issue- “ bitter pill ” for manufacturer0.25 paisa to 0.50 paisa mid 80’s0.50 paisa to 1.00 rupee mid 90’sRe. 1/- to Re. 2/- late 2008

• Strategies to combat coin-barrier issue

Distribution & Selling strategy:

• Almost (75- 80)% sales come from W/S channel in general

• B.P and Hilal > WS driven > Media pull > wide-spread national distribution network over 250-300 towns > mass market products Re.1,2 and beyond > Cost leadership strategy > High Volume sales

• Cadbury’s , Candyland, Mitchell’s and Mayfair > retail inclined > building brands

Drivers, Challenges & Trend• Drivers: