Export Business Plan

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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
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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 13-14
Production 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

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ALLANASONS LIMITED
Allana Centre,
113/115
M.G. Road, Fort
Mumbai - 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, Middle
East, 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 investment
company). AML has investments in Egypt in Edible Oils and Fats. Further, ASL also has investments in
other group companies such as Frigorifico Allana based in India, which has a frozen meat manufacturing
plant in Aurangabad and Middle East Oil & Grains Ltd based in UAE who has investments in a large silo
facility, 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 old
Allana Group. It is one of the largest producers and exporters of processed foods and agro-commodities
from India. The product range includes frozen marine products, frozen buffalo meat, frozen halal buffalo
meat, 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 with
the sense of business and trading in agriculture products. It is now a major producer and exporter of
processed fruit, spices, coffee, frozen meat and marine products. Allanasons head office is in Mumbai
and is perhaps the largest exporter of Halal boneless buffalo meat. Canned corned meat and frozen
offal are the other major meat products which are exported by the company. The Allana Group has
pioneer (1969) position in the export of deboned and deglanded frozen Buffalo meat, exporting its
products currently to 64 countries worldwide, including South East Asia, the Middle East, CIS
(Commonwealth of Independent States), Africa and Pacific Basin Nations, singularly accounting for
about 60 per cent of meat exports from India. It has registered modern, integrated meat processing
abattoirs cum plants at Mumbai, Delhi, Taloja Maharashtra and Sahibabad Ghaziabad UP, which were
set up according to the highest international standards and specifications, and incorporating the latest
technology and automation in all stages of meat production. The company adheres to the requirements
of Islamic slaughter.


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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's
Largest 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 fruit
and 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 and
frozen marine products.The Group has also set up plants for processing, preserving and freezing of
Marine Products, which are approved in accordance with stringent quality standards for export to
Europe. 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 ISO
9001:2000 and HACCP. And ISO 14001 (Environment Management System) too!































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PRODUCTS:


Range of products:

Fresh, frozen boneless Buffalo Halal meat
Chilled boneless Buffalo meat Compensated boneless Buffalo meat is
supplied 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 and
deglanded frozen Buffalo meat, exporting its products currently to 64 countries world-wide, including
South East Asia, Middle East, CIS, Africa and Pacific Basin Nations, singularly accounting for about
60% 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



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Meat Products : Frozen Lamb Meat

Lamb meat has a high nutritional value and is an especially good source of easily absorbed zinc and
iron. 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 are
processed on the upper floor while the by-products processing is carried out on the ground floor to
maintain plant hygiene standard at the highest level.

All animals slaughtered at the ultra modern abattoir-cum-meat complex undergo ante mortem and
continuous postmortem inspection, carried out by the government veterinarians and the entire Corned
Meat processing operation is under the supervision of Central Government Inspection Agency. A
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comprehensive veterinary health certificate is issued for every consignment of Corned Meat Confirming
its suitability for human consumption.

A Halal certificate is provided for every consignment. Corned Meat is produced from thoroughly trimmed
fore-quarter hind-quarter cuts and has appealing pinkish red colour, pleasant flavour, characteristic of
Corned 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 fresh
chilled 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 from
oxidation and dehydration during storage.

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

Restaurants that buy fresh vacuum packed chilled meat can offer their customers meat that is both
tender and juicy and save shrink and trim losses. Fresh meat can be bought for inventory, eliminating
overbuying and under buying. Meat cutting and wastage are reduced.
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Meat will become tender just as fast in vacuum pack as under ordinary hanging conditions because
tenderizing is an enzymatic process that goes on inside the meat. Natural Enzymes in the meat act to
break down the tissues and make the meat more tender. The so called aged flavor comes from mould
growth and does not develop in Vacuum Packed meats.

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

Meat Changes in colour from bright red to purplish-red when oxygen is removed from the Vacuum
package by the vacuum sealing process. After the package is opened, and oxygen reaches the meat
surface 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 in
the meat give the fluid a reddish-brown colour. The amount varies with the extend of cut surface
exposed, the quality of the meat, and the storage conditions, but is usually less than 1% far less than
what 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 a
few 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



















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ALLANASONS LIMITED


Rationale

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

Further the rating also takes into account comfortable working capital
management and present debt-free status of ASL.
Going forward, the ability of the company to maintain strong liquidity profile as well as working capital
management 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 was
incorporated 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 is
supported 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 period
April 2008 to March 2009) to Rs.3,730 crore in FY10 and to Rs.4,783 crore in FY11, which is a growth of
nearly 33.56% in FY11 as compared to FY09. This was mainly due to increase in demand of frozen
foods, 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 Halal
buffalo meat has been in existence since 1979. ASL also has a diverse basket of products with frozen
foodstuff (including meat, mutton, fruit pulp,leather among others) constituting more than 85% of sales
over 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 three
decades, 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% which
is contributed through domestic markets. The company distributes its products under the brand name
Allana to wholesales who further distribute them to retail customers.


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Long-term customer relations

Although ASL does not enter into long-term contracts with its customers, it has maintained long-term
relations 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 of
Credit, while the balances are open receivables. The company has rarelyprovided for, or written off bad
debts in the past.

Comfortable Working Capital Management & debt-free company

ASL being a trading company has highly working capital intensive operations. However, the companys
operations are unique with very low to negative working capital cycle. As ASL is the trading arm of the
group and the creditors being the associate companies which are supporting ASLs working capital
requirements 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 for
the 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.
















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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.g
China, Malaysia, Indonesia ,ASEAN Country, Europe,Russia and Gulf countries

Allana Sons Ltd has 5 factories in UP namely Aurnagabad,Aligarh,Unnow,Sahibibab,Zerabad
AND 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 to
JNPT 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 Credit This 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 as
they 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 the
clients with whom they had good relation.Even new clients they do it if the reference
client 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 IRAG Due to Political issue with IRAG
they 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
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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 is
landed at the Kuwait port then Allana Sons Ltd will take back the goods from the Kuwait port to Mumbai
or any other client ordered for the same.

During the landing of the Goods at Kuwait port and taking back the freight charges is adjusted against
the 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 X
He said that, few months back one of the client requested for the goods to be exported to Jordan
instead 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 Jordan
and 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 to
take the lnterest or give Interest as its against the Islamic Law ; hence they dont preferred loan
system or even its there it would be very low-

ALMOST DEBT FREE COMPANY













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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 and
Gulf Countries etc. Our aim is to provide maximum satisfaction through prompt deliveries and affordable
pricing of the buffalo meat. Consequently, we would like to earn the loyalty of clients from all over the
world 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 and
frozen 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 in
India. This meat export company will manufactures and process, a variety of meat products as per
individual specifications and needs of meat buyers outside India. What you want? how you want it?
and when you need it? we export meat fresh or frozen with 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 maintaining
substantial meat inventory in India. Our prime product is fresh and frozen Buffalo meat, a Halal food
product, which abide by Islamic law.

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

Our expertise spans markets worldwide and our ability to maintain inventory and make forward
commitments 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 customer
partners.
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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 quality
control. 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 delivery
of 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 us
reaches the clients in top condition. We assure that buffalo meat, we supply is passed through several
quality checks. Moreover, we provide hygiene packaging for our buffalo meat, so that there is no
compromise 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 maintain
international quality standards, which has been, the primary rationale for their success in the
international 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 than
half 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 Houses
throughout thecountry. Some of the slaughter houses from where theexporters source their requirement
are Deonar abattoir,Mumbai, Meerut, Jaipur, Saharanpur, Bareily, Hapur,Muradabad, Khurja, Gangoh,
Hyderabad, Aligarh,Muzzaffar Nagar, BulandSahar and Meerut slaughterhouses.


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Structure and Competition:-


World Exports 2013 Revised:

Broiler Meat Higher, Beef Lower and Pork Unchanged
















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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 4
OPEC 2
HK 2


Competition:-

USA
Brazil
EU
China
Argentina
Australia
Mexico
Russia
Canada
Japan
Paraguay
South Korea
Saudi Arabia
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Legal/Regulatory

Beef Labelling The Beef Labelling Regulations apply to fresh, frozen and minced beef, with the
information 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 written
and 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 and
date 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.







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Market Research
Market research is any organized effort to gather information about target markets or customers. It is a
very important component of business strategy. Market research is a key factor to maintain
competitiveness over competitors. Market research provides important information to identify and
analyze the market need, market size and competition. Business decisions that are based on good
intelligence and good market research can minimise risk and pay dividends. It helps Identify potential
customers, 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, product
survey, product research and development as it is highly competitive. Various challenges, identification
of needs and wants of foreign buyer in export marketing can be dealt with through international
marketing research.

Overseas market research is a must for successful and profitable export marketing. This is the most
promising 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 easily
for the conduct of overseas market research. Field research is required when published data are not
available as per the need of the research project. The popularity of overseas market research is fast
growing along with the globalization of business.

Selectivity is the key to success in all spheres of life including export marketing. An exporter may wish to
deal in all kind of products and to sell them anywhere in the world. However, it is not possible for him to
do so due to the wide expanse and demand variations in different markets of the world. Therefore, an
exporter 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 and
begin 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 market
research reports are quite expensive to produce, they are not done on products which have little current
potential or where there may be significant constraints in the form of regulation, tariffs, non-tariff barriers
or economic and political upheaval.

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


Target Countries:

Primary : ASEAN countries Brunei Darussalam, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar,
Philippines, Singapore, Thailand, Vietnam
Secondary: Gulf countries Kuwait, Iraq, Bahrain, Oman, Qatar, Saudi Arabia and UAE , Jordan and
china





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Market conditions in the target countries:

India is likely to become the worlds largest beef (buffalo meat) exporter by end of 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 and
Southeast Asian countries. (Source: Global Trade Atlas)

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

Many Asian countries, mixed farming involving crops and livestock integration has been a way of life
since the beginning of agriculture. It is widely realized that this is the only method of providing additional
income 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 in
favor 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 good
slaughter facilities. As health conscious consumers in the West turn to vegetarian diets, meat demand is
slowing. This is offset by rising demand in Asia-Pacific, which is followed by North America and the EU
in terms of consumption.


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

Promising trends have appeared for bovine meat consumption in countries like Vietnam, Hong Kong and
Malaysia according to a recent report by Meat and Livestock Australia. The strongest growth has been
evident 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 subsistence
agriculture into cash based economies.
Indonesia:

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

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For 2014, Indonesias Ministry of Agriculture has allocated as much as USD 823 million for agriculture
self-sufficiency programs. Agriculture Minister Suswono revealed that the allocations for corn, soybean
and 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 and
convenience trends. Consumer awareness in nutrition value and food fortification for healthcare has
created the demand for functional, minimally processed fresh, organic and natural foods. Consumers
are 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 and
Halal requirements. Australia, with its stringent source traceability enforcement and absence of meat
safety 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 inherent
shortages in good quality indigenous feed materials and the use of imported animal feed
ingredients, inputs and feed products. Trade and government sources comment that local feed
production costs have substantially risen over the past 5 years, because of higher world market prices
for key feed ingredients.

Short term measures, i.e. tariff rate increases, being applied in an attempt to control an explosion in
meat imports. These actions are reactive, and highly confusing for importers and the broader
market, 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 government
departments and agencies are involved, and most do not understand the WTO or FTA commitments
and protocols that Vietnam now has to work within. The core focus at present continues to be tactical
protectionism and dealing with balance of trade issues, rather than moving forward in a strategic and
transparent 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 and
New 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 the
number one beef exporter. Brazil, Uruguay, and Argentina are investing in their meat industries
to remain strong and competitive.

During the period of large surpluses of animal products, the EU had a distorting affect on the
domestic markets in African countries. Frozen beef, mainly in forequarter cuts, were being
dumped in Africa, mainly West Africa. This distorted local prices for livestock and meat. With
the enactment of the Central Agricultural Policies (CAP) for the EU, the regions exports
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declined to 1.5 mmt in 2005 and is expected to further decline to 800,000 mt in 2015. The EU
could 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 into
Asia and other regions, that West and Southern Africa would increasingly become more deficit
in meat. For Ethiopia to be a serious export player, the industry will need to be better integrated and
vertically coordinated up and down the value chain.

Countries have certainly used SPS as a highly effective form of protection from the pressures
arising from globalization (IMS - GIRA). Middle East countries have been in the forefront in
this 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 through
2005, 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 importers
were Egypt (14,500 head), Kuwait (11,200), UAE (6,920), Qatar (780), and Oman (1,200). The
simple average price for Australian cattle exported to the top four importing countries was $462
per head in 2005. (All export valuation data reported by exporting countries is the FOB price
and import valuations are CIF prices.)


Competition:

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

Global beef production for 2013 is virtually unchanged from the October estimate at 57.5 million
tons 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 a
more reticent outlook for India which exceeds upward revisions for Brazil and Australia. Import demand
in East Asia, particularly in China and Hong Kong, is stronger while other key markets are weaker on
lower 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 pasture
to soybeans and corn during the current season, herd expansion is bolstered by government support,
genetic improvements, better pasture management, sustained cattle prices, excellent pasture
conditions, 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 ample
supplies boost shipments. A 16 percent devaluation of the Real over the past year will help Brazilian
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competitiveness. Thus despite the atypical BSE case in the state of Parana, only made public in late
2012, restrictions by Saudi Arabia, Japan, South Africa, South Korea, China and Taiwan (combined less
than 5 percent of exports) will be more than offset by demand from other markets. Increased
opportunities for shipments to Russia will likely be generated due to gradual Brazilian plant relistings as
well as Russian restrictions on competing U.S. beef

SWOT ANALYSIS:

Strengths:

Providing Halal meat catering to the Middle east and gulf countries
Cheap cost of production and labour
Geographical proximity to major markets

Weakness:

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

Opportunity:

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

Threat:

Increasing popularity of beef from Australia world over and more so in the developed countries
Increasing 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 to
trade are imposed in many forms.
Border protection measures, including tariffs and quotas, are the most obvious. However, non-tariff
barriers including unfair competition in the form of subsidies, technical imposts, and exports from
countries 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 future
trends in demand and which demographic groups to target. (The databases consulted do not provide
enough 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 primary
export countries and then summed by product categories).

2. Identify a market intermediary, a local service provider (LSP), in each country in the Gulf States, Who
has the capacity to enhance market linkages and represent Indian meat companies in Penetrating the
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market segments identified as most promising in no. 1 above. The LSP could be Responsible for
promoting 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 trial
shipments outlined in #4.

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

5. With the help of the LSP, undertake a promotion program, for example running a feature in a set of
hotels 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 a
country.

6. Improving Market access :

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



















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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 vary
depending on the existing market price of the meat. As we compete with other meat-producing
companies, we will promote our products through advertisements with the aid of streamers and
pamphlets. 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





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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 cold
storage 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 1
Cr 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 give
discount 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 520 540 tonnes of buffalo meat.
And 40 feet container of 25 30 which in totality brings the revenue of around 10 Crore. Our aim is to try
to 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 market
price 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 to
keep 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
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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



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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.








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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 depending
on 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 profit
of 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 to
minimize 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 target
a revenue of Rs. 30 to 40 Crores. Also in the next 5 years, depending on our financial capabilities, we
will decide on opening our plant near Aurangabad / Satara. We aim to spend around 40% of our gross
profit 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 research
and 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.