Strategic Planning

Assignment No: 4
Submitted To:
Sr. Amjad Ali
Submitted By:

Shaista Bano l1f17bsaf0112

Zunaira Riaz l1f17bsaf0045
Summaya Sher l1f19bsaf0134
Javaria sadique l1f19bsaf0182
Section: B
Group: 6

Company Name:
Different types of the strategies followed by the organization

Introduction
At present, there are 1,221 ginning units, 442 spinning units, 124 large spinning units and 425
small units which produce textile. Total 464 Textile mills are working in Pakistan.  Major Players
in this industry are Nishat textile mills, Chenab Ltd, Al-Karam Textile, Gul Ahmad Textile Mills
Ltd, Hussein Industries Ltd, Kohinoor Textile Mills Ltd, and Nishat Linen. NML got the edge of
having their own power plant due to that they are not suffering from industrial power crisis. And
sustaining their position in Market.

As the market growth is high, and Nishat Textiles has strong comparative position in the market.
So, the possible strategies for Nishat Textiles may be Market Development, Market Penetration,
Backward and Forward Integrations. And Nishat is also implementing these strategies by
developing their market in a combination with forward integrations. And implying with quality
sustainability to cope up with ISO standards.

Possible strategies for Nishat Textiles

 Backward Integration
 Forward integration
 Horizontal integration
 Market penetration
 Market development
 Product development
 Diversification (related or unrelated)
All these strategies are corporate level strategies. Senior management design these strategies and
then implement on the firm. Nishat mills use the Market Development, Market Penetration,
Backward and Forward Integrations strategies.

Forward integration

It is the form of vertical integration in which a company become its own seller and having a
more control of the direct distribution of its products to have a competitive advantage. Previously
Nishat mills produces Cloths and now Nishat mills open its own outlets and sell directly to
clients. This type of integration
called as the forward
integration.
Nishat Mills Limited was established in 1951. It produces cloths and sell through distribution
channel but a time ago they realize to go into forward integration and now nishat mills have its
own outlets with the name of Nishat Linen and sell their products directly to customers.

Backward Integration

It is the form of vertical integration in which a company becomes its own supplier and having a
more control of the supply of raw material of its products to have a competitive advantage. It is
attempt of reducing supplier power and thus reducing input costs and lower its dependability on
suppliers.
Nishat mills purchase its raw material from different suppliers but recently they grow its own
cotton and become its own suppliers. Cotton production which is also a competitive edge as they
are controlling the whole supply chain.

Horizontal integration

Horizontal integration refers to addition of same kind of business in the existing business in
order to increase production, market share and to reduce competition. It is generally done by
acquisition of competitors, merger with existing firms or by setting up new plants.
May be considered first. Nishat mills may acquire a smaller producer like Integrated Textile
which is also catering to outsourcing needs of global partners in Pakistan. The company has the
resources to manage an expanded organization and will gain an edge over its competitors.
However, the fate of other Pakistani home textile producers does seem to be much different. And
the acquisition will not deliver any monopolistic characteristics. In fact, the cost of acquisition
may reduce the differential competitive advantage gained from the added economies of scale.

Market penetration
Market penetration refers to the successful selling of a product or service in a specific market. It
is measured by the amount of sales volume of an existing good or service compared to the total
target market for that product or service.
Market penetration as an option may be deliberated. The current local market is still unsaturated
and there is still potential to increase the usage rate of present local customers significantly. But
Nishat mills is a premium producer while the buying power of consumers is eroding with no
relief being provided in subsequent budgets.
Thus, relying heavily on the local market to make up for its lost international sales may not be
advisable. Market penetration is appropriate when shares of major competitors are declining
while the total industry sales are increasing. This is not the case with Pakistani home textile
sector.

Market development
Market development is a growth strategy that identifies and develops new market segments for
current products. A market development strategy targets non-buying customers in currently
targeted segments. It also targets new customers in new segments.
Nishat marketing strategy based on market expansion and product development. Currently their

target segment is exclusive and formal wear for formal now they target professional females
including stylish and convenient outfit having a variety of designs but superior quality. Bed linen
also needs to be emphasized more regarding variations in styles and designs

Aggressive marketing has been the major factor in nishat consistent profitability over the past
years. Their strategy is to remain in terms of exploring new markets and new products. The focus
is on niche marketing with specialized products. They have differentiate their Business through
consistent quality, reliable delivery and proactive handling of customer’s needs.
Investment in state of the art technology and top quality human resources has been key element
of their Business strategy. Nishat is also exploring business opportunities in Spain and France
where it has very little Business at the moment. North America is the star market fir nishat
The main objective of nishat is to expand their business in USA, Europeans union, India UAE
and further countries where there is a need it cater the textile sector, they are planning to form
partnership with local incorporated cloth companies in other countries, still develop products,
services, and marketing campaigns designed to appeal to customers in other countries.

Product development
Product development seeks to increased sales by improving or modifying present products or
services. Product expansion strategy used in product development the very important opportunity
for the nishat mill is that it should expand its products in the form of knitwear. As NTM has
plants, good market position and strong financial back so it should avail this opportunity by
dealing in knitwear.

Diversification (related or unrelated)

Related Diversification occurs when the company adds to or expands its existing line of
production or markets. In these cases, the company starts manufacturing a new product or
penetrates a new market related to its business activity.
Unrelated Diversification is a form of diversification when the business adds new
or unrelated product lines and penetrates new markets. Nishat diversified into different segments
which are not directly relate to textile business like it enter into cement business, bank, and have
insurance companies as well. So it’s a kind of unrelated diversification.
Nishat’s product line is highly diversified where it sells bed linen to kitchen coordinates,
upholstery to apparel providing it significant positioning and penetration in the market to cater to
the customers who want a one-stop shop experience
Nishat’s complete product line is as follows:
 Nishat – Clothing Line for women
 Nishat– Clothing Line for men
 Bed & Kitchen Linen and Accessories
 Bed sheets
 Quilts
 Bed spreads (regular/ bridal sets)
 Kitchen (table linen, mats, table runners, bread boxes, aprons)
 Cushions ((Zari, 6 piece sets, matched with bed sheets)
 Fillings
 Jai Namaz
 Fashion Accessories
 Laces
 Bangles
 Shawls & Stoles
 Handbags
 Clutches