Report of Strategic Marketing

Management
Afroze Towels (Pvt) Ltd
Submitted by:
Komal Siddiqui (3050)
Ali Hyder Shah (2860)
Nazish Ali (1005)
Humaira Arshad (5155)
Submitted to:
Sir AyazRafique
Date:
20th Dec2015

Letter Of Acknowledgment

Dec
20th2015
Dear
Readers,
We would
first like to
thank
Almighty
ALLAH
for giving
us
the
strength
and
endowing
us with the
privilege
of
completing

our report.
We are also extremely thankful to our mentor Mr Ayaz Rafique for his constant support,
encouragement and guidance, without which we could not have successfully achieved our task.

We would also like to thank Mr. Abrar Manzoor of Afroze Towels and his marketing and financial
departments, and our course fellows who spared their valuable time to help us and provided us the
guidance to finally come up with this report. We will seek your continuous assistance and support in
future.

Sincerely,
Komal Siddiqui
Ali Hyder Shah
Humaira Arshad
Nazish Ali

Table of Contents
Executive Summary .4
History of the Company....5
Introduction ..5
Management..5
Core Values ....6
Mission...6
Vision..7
Factory Details7
Product Lines..7
SWOT Analysis .....8

Tows Matrix....9
Marketing Mix ....10-11
Porters five forces ..11-12
Porters four corners Model .....13
BCG Matrix ......14
Marketing
Strategies..15
Countries to Export .15-16
Financial Data .17-19
Recommendations ....20

Executive Summary
The report at hand provides useful insight about Afroze Towel Private Limited, a private
organization producing 100% export quality towels. Established in 2005, currently a leading as a
towel manufacturer company in Pakistan, provide Bath towels, Bath Robes, Beach Towels, Face
Towel, Kitchen Towels and Terry Towels. This facility is vertically equipped with most modern and
latest machines for weaving, dying and finishing process. The production capacity of this industry
includes Terry Towels 2000 tons per month, Bath Towel 1000 tons per month, Bath Robe 1000 tons
per month, Beach towel, Face towel and Kitchen towel is also same 1000 tons per month.
Undoubtedly they have an educated and experienced workforce that geared up their efforts to meet
and exceed the targets and challenges to achieve record production with increase of export level.
They are well familiar with their best towels of first choice exporting huge quantity of products every

year to USA, UK & European countries and being amongst the largest exporters of Pakistan, wining
every year the largest exporter trophy since 2004.
After the introduction the Afroze Towels core values, mission and vision statement, factory
detail, product lines, SWOT and Tows analysis, marketing mix, porter 4 corners model, Porters 5
forces, BCG matrix, marketing strategies, competitor analysis and in the last financial analysis of the
company has been done. Finally, certain recommendations are also given at the end of the report.

HISTORY OF COMPANY

Afroze Towels Industries Private Limited is a well renowned group in home textile sector and
unfolded its memorable history while in 1973 a man named MahboobAlamLari started trade of home
textile products by manufacturing & launching export quality Terry Towels into international market
and quickly earned trust from across the countries. The acknowledgement and appreciation of his
entrepreneurial expertise encouraged him to step up into the home textile arena. From here on, there
was no looking back.
Owing to dynamic manufacturing quality oriented product capabilities and determined conviction
across all management and workforce to achieve and exceed the targets and challenges.

INTRODUCTION
Established in 1973, Afroze Towels Industries (Pvt) Ltd has four decades of manufacturing and
market experience. The company was founded by late Mr. MahboobAlamLari. Since our inception
4

Afroze Towels has been focused on quality customer satisfaction innovation and specialization
through technological advancement.
Afroze Towels is managed by qualified and motivated professionals under the dynamic leadership of
company directors Mr. FerozeAlamlari and Mr. AfrozeAlamLari. With annual export capacity of
USD 200 million Afroze textile has earned a top position among the country's leading towel and bed
linen exporters recognized and appreciated by our international clients.

MANAGEMENT
They believe that employees are the backbone of a successful organization.Factories are managed by
specialized under the leadership of Mr.FerozeAlamLari and Mr. AfrozeAlamLari.
Department heads of Design ,laboratory,planning,processing,procurement,qualityassurance,stitching
and weaving combine their expertise and knowledge to create the finest quality products.

CORE VALUES:

Care is at the core value of our business model

We care about our customer's satisfaction and adding value to their businesses. We have made
customer satisfaction the key focus of our manufacturing and service standard; to meet this goal we
invest in innovation, give special attention to detail and adhere to deadlines.
We ensure that our employees are happy and motivated and our teams believe in value of respect,
dedication and caring for the environment.

MISSION:
5

Setting a trend in textile sector that could deliver globally the value to our business
partners through innovative technology with efficient workforce and to fulfill social,
ethical and environmental responsibilities.

VISION:
Afroze Textile Industries Private Limited aims at being the best manufacturer and
exporter by providing effective management services in home textile sector for
efficient production, processing and marketing of high quality products.

FACTORY DETAILS
Afroze textile industeries(Pvt)Ltd. Companies of two fully owned vertical setups.
The towel and bedding factories cover an area of 650,000 square feet and 800,000 square feet
respectively.The combined work force totals approximately 3,000 people.
Both the unit have top of the processing and stitching machines,fully equipped laboratories studios
and currently the largest product portfolio in the home textile industry.

PRODUCT LINE

TERRY TOWELS:

Bath towels
Bath Robes
Printed Beach Towels
Hand Towels (for hospital and kitchen use)
Woven Kitchen Towels

SWOT ANALYSIS
A SWOT analysis is a structured planning method used to evaluate the strengths, weaknesses,
opportunities and threats involved in a project or in a business venture. We have conducted SWOT
analysis of Afroze Textiles so that we would able to know their internal Strengths and weaknesses and
external opportunities and threats.

Strengths:
7

 State of the art dying processing unit

Capacity to process more than 1200 tons towels/month
One of the few Manufacturer and distributer in top ten suppliers and vendors to Walmart,
Tesco, Asdaetc for towels.
Supply base of more than 100 international clients
Modern and hi tech machinery

Weaknesses:

Low Gas pressure problem and Increase in cost of gas due to which production cost increases.
Water Supply problem (900000 gallons/day which is equal to the need of 1800 domestic
consumers)
Incomplete labor constraint

Opportunities

Capable to double the operations and production in approx. 6 months.

Huge market potential
Bangladesh towel sector is about to collapse due to their import of cotton which increases
their production cost
India is about to exit this sector as it is going in manufacturing hi-tech products locally

Threats:

Law & Order situation

Multicultural environment as it promotes formation of CBUs so the grouping can be a threat.
Complete Gas Supply shutdown in future will force us to use coal power generation as an
alternative
Production of towels is largely dependent upon locally produced cotton . If the production of
cotton reduces the company may not remain competitive.
International poltical situation

TOWS Matrix

Strength:
1.
2.
3.

Super Swot

4.

5.
6.

7.
Opportunities:
1.

2.
3.

4.

Capable to double the

operations and production in
approx. 6 months.
Huge market potential
The
Bangladesh
towel
sector is about to collapse
due to their import of
cotton, which increases their
production cost.
India is about to exit this
sector as it is going into
manufacturing
high-tech

State of the art dying process unit

Capacity to process more than 1200 tons
towels/month
One of the few Manufacturer and
distributor in top ten suppliers and vendors
to Wal-Mart, Tesco, Asda etc. for towels.
Supply base of more than 100 international
clients
Modern and high tech machinery.
Large amount of capital.
New ideas of innovations.

S-O

Weakness:
1.

2.

3.
4.

W-O
They should look into and capture the
Bangladesh towel market sector, as they
have a large amount of capital and have a
capability to produce and import
internationally. (S6, O3)
They should manufacture their product
locally also as they have a capacity to
process more than 1200 tons towel per
month and they also have the ability to
double operation as needed.(S2, O1)

products locally.

Threats:
1.
2.

3.

4.

5.

S-T

Law & Order situation

Multicultural environment
as it promotes the formation
of CBUs so the grouping
can be a threat.
Complete Gas Supply shut
down in the future will force
us to use coal power
generation as an alternative
Production of towels is
largely dependent upon
locally produced cotton. If
the production of cotton
reduces the company may
not remain competitive.
International
political
situation

They should established their

own water dams and plants for
their operations and productions
because still they are capable to
double
their
production.
(W2+O1)
They should expand their
operations to fullfil the market
demand as they have the
capacity
to
double
their
operations
in
6
months.
(W4+O1)

W-T

Low Gas pressure problem and

Increase in cost of gas due to
which production cost increases.
Water Supply problem (900000
gallons/day, which is equal to
the need of 1800 domestic
consumers)
Incomplete labor constraint.
Demand is greater than the
supply

They have produced a new type of towel

which is made from bamboo (S7+T4)
Afroze towels may use coal power instead
of gas by investing in coal power
generation. (s6+T3)

The lowest Gas pressure

problem and Increase in cost of
gas due to which production
cost, increasing day by day and
it seems that complete Gas
Supply shutdown in future so
they will have to use an
alternative way to fuel up their
operations which could cause an
increase in production cost so it
will force them to shut down
their operations. (W1+T3).
Shortage of Labor and formation
of CBUs in existing labor will
largely affect the companys
productivity. (W3+T2)

MARKETING MIX
4 Ps Of Marketing

Marketing is integral to the success of a business, large or small, with its primary focus on
quality, consumer value and customer satisfaction. A strategy commonly utilised is the
"Marketing Mix". This tool is made up of four variables known as the "Four P's" of
marketing. The marketing mix blends these variables together to produce the results it wants
to achieve in its specific target market.
The following are the Four Ps of Afroze textiles:
1.

Product
Afroze is producing 5 types of terry towels and exporting them to 36 countries worldwide to
fulfill the international needs of towels.

Bath towels
Bathrobes
Printed Beach Towels
Hand towels (For Hospital use)
Woven kitchen towels

2.

Price
Pricing is done after analyzing international market demand of towels and competitor
offerings and to have a attractive amount of profit. 2% sales discount is offered to potential
clients.

3.

Place
Different international stores like Walmart, ASDA, TESCO etc. are mainly focused to have
the product on display for mainly domestic use. There are other international business clients
also like International Gyms, Hospitals, Water Sports, Restaurants
10

4.

Promotion
The marketing strategies used for promotion of the product are

Free Sampling
Face to Face Marketing
Special Discounts

PORTERS FIVE FORCES (Industry Analysis)

The Porter's Five Forces tool is a simple but powerful tool for understanding where power lies in a
business situation. This is useful, because it helps you understand both the strength of your current
competitive position, and the strength of a position you're considering moving into.
With a clear understanding of where power lies, you can take fair advantage of a situation of
strength, improve a situation of weakness, and avoid taking wrong steps. This makes it an
important part of your planning toolkit.
Conventionally, the tool is used to identify whether new products, services or businesses have the
potential to be profitable. However it can be very illuminating when used to understand the
balance of power in other situations. We have conducted the Industry Analysis for Afroze Towels.

11

Porters 5 forces of Afroze Towels

EAC vno mat ripyl e tabi n lvidt y er i oxv aif tl rs byu ab rs ti e ru t e

12

B a r g a i n i n g p o w e r o f bs u py e lr i e r s
PORTERS FOUR CORNER MODEL
(Al Karam Towels)
Porters four corners model is a predictive tool designed by Michael Porter that helps in
determining a competitors course of action. Unlike other predictive models which
predominantly rely on a firms current strategy and capabilities to determine future strategy,
Porters model additionally calls for an understanding of what motivates the competitor. This
added dimension of understanding a competitor's internal culture, value system, mindset, and
assumptions helps in determining a much more accurate and realistic reading of a
competitors possible reactions in a given situation.
We have taken Al Karam Towels as a competitor of Afroze Towels and identified the
competitive four corners of Al Karam Towels which helps us in determining the competitors
course of action.

13

Capabilities
Environment friendly
Having different certification eg. ISO 9001:2008
and supplier qualification program

The BCG Growth Share Matrix

Boston Consulting Group, Bruce Henderson, created this chart to help organizations with the task of
analyzing their product line or portfolio.
The matrix assesses products on two dimensions. The first dimension looks at the products general
level of growth within its market. The second dimension then measures the products market share
relative to the largest competitor in the industry. Analyzing products in this way provides a useful
insight into the likely opportunities and problems with a particular product.
Products are classified into four distinct groups, Stars, Cash Cows, Problem Child and Dog.
Lets have a look at BCG Matrix of Afroze Towels for decision making process.
14

Low

Marketing Strategies Of Afroze Towels

Marketing strategy is the fundamental goal of increasing sales and achieving a sustainable
competitive advantage. The Marketing Strategies of Afroze Towels are:

Whenever cost benefits are achieved over production, they are transferred as
special discounts to consumers
Free Sampling
Face to Face Marketing
Special Discounts to potential clients
15

 Packaging and display is not less than International Standards

Competitive Advantage
Afroze differentiate its towels from the International competitors in terms of the quality of the
towels which can b felt by touching and feeling the soothing and relaxation and softness of the
towels.

International Competition Fierce

Chinese, Indian and Bangladeshi goods have entered into the International market due to
which the competition has increased to a huge extent.

Countries to Export

Algeria
Austria
Belgium
Brazil
Canada
Chile
Columbia
Czech republic
England
France
Germany
Greece
India
Iran
Ireland
Italy
Japan
Kenya
Lithuania
Mexico
Netherlands
New Zealand

16

Peru
Poland
Russia
Saudi Arabia
Slovakia
South Africa
Spain
Sweden
Thailand
Tunisia
UAE
Ukraine
USA
Venezuela

FINANCIAL DATA OF AFROZE TOWELS

PROFIT & LOSS STATEMENT

17

Sales..56518250
Less:C.O.G.S.......(44804800)
Gross Profit Margin.......11713450

CONTRIBUTION MARGIN STATEMENT

Sales

.. 56518250

Less: Variable C.O.G.S..... (35843840)

Gross Profit Margin . 20674410
Less: Other variable selling costs .. (2568941)
Variable Contribution Margin ... 18105469

CONTRIBUTION BY PRODUCT LINE

Bath
Towels
18

Bathrobes

Printed
Beach

Hand
Towels

W.Kitchen
Towels

Towles
Sales

24588000

6830000

20490000

2049000

2561250

Less:Variable

16392000

4371200

12020800

1420640

1639200

Gross Profit

8196000

2458800

8469200

628360

922050

Other V.C

1541365

256895

513788

128447

128447

Variable C.M

6654635

2201905

7955412

499913

793603

COGS

PERCENTAGE VARIABLE CONTRIBUTION MARGINS

No. of
Customers

19

Bath
Towels

8196000

Bathrobes

Printed
Beach
Towles

Hand
Towels

Kitchen
Towels

1366000

2732000

2732000

1366000

Average

3.0

5.0

7.5

0.75

1.8

V.C / Unit

2.18

3.3

4.5

0.56

1.29

VCM / Unit

0.82

1.7

3.0

0.19

0.51

27.33%

34%

40%

25.33%

28.33%

Price

PVCM

BREAKEVEN ANALYSIS
Breakeven = Totala Fixed Cost/UVC
Breakeven Point :
Bath towels

= 4098000/ 0.82

=4997560 units

Bathrobes

= 1092800/ 1.7

= 642824 units

Printed Beach Towels

= 3005200/3.0

= 1001733 units

Hand Towels

= 355160/0.19

= 1869263 units

Woven Kitchen Towels = 409800/0.51

= 803529 units

RECOMMENDATIONS
Following are some recommendations for Afroze towel private limited:

The co-ordination between different departments of Afroze should be improved, it will lessen
the bureaucratic cost and increase the efficiency of the company.

The activities like customer satisfaction day should be performed on a regular, basis, so the
company should know the feedback and satisfaction level of customers regarding the product
and the image of the company.
20

They could increase their effective policies and seriousness for local presences in their
economy.
They could collaborate with buyers on forecasting and inventory management.

21