Professional Documents
Culture Documents
Dilmah 1 PDF
Dilmah 1 PDF
Dilmah 1 PDF
By submitting this assignment I confirm that I understand and abide by the Cambridge College’s
plagiarism and collusion regulation
Company Background
Dilmah is the first value added Sri lankan owned global brand, who pioneered in
single origin tea. Dilmah holds the trade mark for producing finest and fresh natural Sri lankan
tea in premium quality. Dilmah offers over 2700 innovative products across 49 diversified ranges
to match the ever changing tea gastronomy over 105 local and international markets. The brand
voiced its unparalleled commitment towards delivering quality and undisputed high standard teas
to its consumers in elaborate packaging.
Products portfolio
Competitors
With the local market branded market has only 42% market share while 58% market share
consist of unbranded loose tea market. Over 400 players in the branded market, Local
competitors, consist of ,Lipton, Zesta, Watawala, Ceylon tea, Mlesna, Halpe Tea,
Bogawanthalawa tea, Ran Kahata and Senra Tea.
Watawala remains the retails market leader with 18.7% market share. Lipton 12.8% , Zesta
6.5% and Dilmah holds 4.3% market share
Global completion consist of Lipton, Twinings, Kusmi, Tetley, Mariages Freres, Tazo, The
republic of tea, Yorshire tea, Harney and sons.
Dilmah , a powerful role model and strong authentic brand for sustaining its relevance and
remain attractive creating ever increasing brand equity for decades after they were created.
Although Dilmah act as the sixth largest tea exporter in the globe, minimal market share exist
within the local market. It is noted that Dilmah is not the first buying preference of the most local
everyday consumers and lesser brand awareness is created within the local community and
minimal brand equity exist despite of brand’s existing customer awareness strategy, thus
depriving the local community to taste the world class product with the proud feeling of Ceylon
natural tea. With the high potential ability harness through years of market expertise and
technical strength, opportunity is available for the brand to expand its market share and be highly
visible island wide as a brand with 31 years brand presence led by the world’s most experienced
tea maker.
Through this assessment we will find out more on the performance of Dilmah’s micro
environmental factors and macro environmental factors and their impact on the organization and
its development
SWOT Analysis
Strengths
Working with a major crop; value creation through single origin tea estate, authentic, natural,
and ethical tea.
Diversified conglomerate.
Financial and special expertise in marketing and innovations.
Strong brand heritage with local and international industry expertise
High technology and production capacity
Global foot print : almost 60% of revenue is generated through international sales
Weaknesses
Business is in growing sector and the brand is well positioned to take advantages of available
opportunities
Lesser tax constrains involved with tea bag exporting
Easy to diversify with the expertise and technology
Threats
It is identified that in order to create stronger customer base, it is vital to communicate the brand
knowledge and create brand awareness. This will pave the way of making stronger and loyal
customer base and when stronger customer base is established through trust and brand loyalty,
business can remain in any environment.
As per the analysis, Sri Lanka, being in the five tea producing country in the worls, Dilmah has
an considerable competition within the country. Local competition consist of average nine strong
competitors and over 58% consumes unbranded tea.
Sri lanka is remained as the third largest tea exporter by USD value, USD 1.40 Billion Ceylon
tea to the world. The country’s tea exports are governed by Black tea and rising global demand
for green tea, organic tea versions and herbal and fruity flavored tea are yet to be met and such
diversification is identified as essential.
The competitors namely Lipton, Zesta, Watawala, Ceylon tea, Mlesna, Halpe Tea,
Bogawanthalawa tea, Ran Kahata and Senra Tea.
All Lipton, Zesta, Mlesna, Bogawanthalawa tea has diversified in to flavored and green tea
segments integrating the demands of both local and international market trends. But no
significance presence in organic tea segment is identified.
New entrants are common in unbranded market, but in order to enter in to the branded market,
capital requirements will be high.
Favorable government policies are available for export market due to the trade deficit position of
the country. Tea as the world’s mostly consumed beverage apart from water, has created
emerging local and international market for new entrants, however high production cost has
limited the overall supply and the growth of new entrant
Established brand loyalty can seen among consumers, thus it is notably tough competition within
the branded market and higher technology and cumulative expertise required to sustain in the
market.
It is recorded average 1.40Kg consumption of tea per consumer within a year and as per the new
report released in May 2019 by United Nations Food and Agriculture Organization (FAO) tea
consumption and production will keep rising in next decade. Black tea consumption is projected
to grow 2.2% in YOY growth and 4.40Million tons in 2027, reflecting strong growth projection.
Coffee is the most common substitute and widely consumed globally despite of tea. Relatively
wider market for coffee can be seen globally rather than the local market and buyers ability to
substitute tea is easy as the price constrains does not make any difference and availability of such
substitute is high just as tea.
Number of substitute can be namely coffee, soft drinks, Fruit and vegetable juices and water.
The relatively price performance of these substitutes are relatively low and more eco friendly
options are available thus along with the rising trend of health conscious, figure conscious for
wellbeing benefits and more go green minimalist trends, propensity to substitute can be high and
switching cost to such substitute can be comparably lower with the cost factor of high quality
tea.
Perceived level of product differentiation is significantly low with the rising demand and global
trends. In order to match the emerging demand whilst eliminating the threat of substitutes,
Ceylon tea should focus on diversifying in to other segments, such as organic and specialty teas,
promoting health and wellbeing.
Dilmah hold a lower bargaining power locally due to its high price constrains to the local market.
Although a budget range was introduced to the market, the positioning of the product not been
done effectively to match the local demand and its competitors.
Watawala - Being the local market leader, but intense competition from other competitors,
Watawala tea is single origin, Lower price, highly strong tea with increased and established loyal
customer base, Marketed as the “Emblem of Sri Lankan tea”, Packaging is in Sinhala to reach
the least proficient customer
Lipton - Market leader in global market in local context, High competition from rivalry
competitors, World’s one of the leading tea brand and maximum market share along with
increased brand identity throughout the world , Marketing motto of “ every cup of lipton tea is
created using natural rain, wind and sunshine” , International brand, hailed from the visionary
man since 1800- Sir Thomas Lipton
MSC 19-57-1322 Page 9
Zesta - High competition from rivalry competitors, Venture between sunshine association
(Watawala owners) & Wilmar International plantation, Strong tea with lower price
However, Dilmah can be differentiated from its competitors for its pure quality single estate tea
with value additions which has become their unique selling preposition. Further Dilmah has a
wide range of value added tea to meet consumer’s need at anytime anywhere in wide array of
flavor contexts.
Due to Sri Lankan imposed tax on tea exporting companies, tax Dilmah’s exporting cost will be
high. Further Sri lanka Tea board regulated tea imports in to country. It requires license to import
tea and only registered tea exporters can import tea in to Sri Lanka for value additions and re
export. Also when re-exporting packages should labeled as, Ceylon tea blended with other origin
teas.
Economical
Slow growth of GDP capita per income, High corporate taxes, high per hour wages for
employees, High volatile rupee value.
Social
Increasing high obesity levels, High level of cholesterol and diabetic patients, Replaced trend
with substitutes such as coffee.
Technology
Lower focus and improvements on country’s research and development, thus relatively lower
tendency complying with new innovations inline with the global market trends
Environmental
Tea production is environmental healthy and more green and eco friendly options should use in
production and packaging
Legal
Patent registrations, licensing is required. Sri Lanka standards institution (SLSI) together with Sri
Lanka tea board does product certifications; Sri Lanka Standard (SLS), ISO which connects with
The conclusion of the assessment can be briefed as overall Ceylon tea has gradually lost its
markets that we once dominated. India seems to have gained in the mentioned markets
and has superseded Sri Lanka in most of them. This depicts that protectionism would not
boost the industry’s competitiveness and globalization is an important factor to be
considered with respect to the future of the tea industry.
Dilmah being a larger tea exporter, should focus seriously on ever changing market place
and its local proliferation through gaining competitive advantages through differentiating.
Global competition should be matched with creating brand awareness through product
range providing healthier and wellbeing dietary solution selling on increasing health
problems, such as diabetes, cholesterol, heart diseases, obesity, cancer and other cronical
diseases.
It is identified a functional management structure is exercised within the organization locally and
more generalist (geographical ) organizational structure followed in global selling.
Chairman → Director Sales → General Manager Shares services and customer service → Senior
Marketing Manager → Regional Marketing Manager
Sales and distribution agents are deployed over 100 countries where Dilmah is sold, to drive the
business and find new business leads.
The organization culture represent its brand through attitudes, values and underline behavioral
characteristics. Dilmah’s culture directly influences the organizational decisions, actions and
overall performance of the organization. The company boast over their assurance built in the
stake holders over years across the island by originating and valuing six pillars of original
Dilmah culture; Quality, Tradition, Our Customer, Ethics, Integrity and Sustainability
New product development and innovation is actively supported by Dilmah within the
organization. This is evident through pioneering, Dilmah seasonal flush tea, Dilmah school of
tea, Tea gastronomy program.
It is noted that company followed two organizational structures in managing local and
international client bases.
Local Structure
The overall staff consist of 842 and extended hierarchy can be seen as, Chairman, Directors,
Senior Managers and Middle Managers, Executives, Clerical and allied staff , Productions staff
(temporary / Permanent).
Organization is benefited from lower higher / middle management cost through increased
functions to individual hierarchy and by performing functional and task oriented, will increase
the effectiveness of handling each function rather than the product or customer oriented
structures.
However the it is noted that mere segregating of functions may lead to functional implications
which will directly affects to companies performance. Further lack of coordination throughout
the organization and geographic duplication, customer duplication as well as neglecting can
happen and same will cause in drastic drop in local sales performance.
In order to sustain with the ever increasing market competition, Dilmah needs to strengthen and
groom its sales and distribution team in more effective and efficient manner inline with the
capture new markets and also to retain the existing clientele.
Global Structure
Global structure mainly focus towards geographical structure, where sales and distribution agents
deployed in each country. This is again a low cost method where we see no threat in
geographical and customer overlapping. However, the service levels may vary and product
knowledge can be limited to a particular buying and demand pattern thus opportunity creation to
new markets and product canvassing to diversified customer needs can be limited.
Since the limited geographical area is overlook by the agent, customer knowledge can be
limited, hence again will restrict the opportunity of canvassing new customer and markets
through business leads.
As the agents are spread through 100 countries management controls over each and every agent
will be lower thus lower productivity will often occur which result more cost over investment
and lower returns and expanding options.
Therefore Dilmah needs to focus on employing country managers where they are responsible for
the overall performance of each country and well defined key performance indicators must
Through this assessment, it was identified that Dilmah needs to widened its distributional
channel whilst establishing brand loyalty among increased customer base. Hence it is vital to
have a best performing sales team to drive the organization towards achieving its success.
Inorder to drive sales team towards desired targets, organization should take corrective actions
by having a well defined sales plan with clear set of goals and objectives. Set of KPIs should
assigned to each hierarchy with a focus of maximum and well maintained output towards desired
organizational target
Dilmah has KPIs covering all operational and functional areas of the organization. These KPIs
are monitored periodically and management reviews are done quarterly basis.
It is informed that the company asses sales teams performance in individually and as a team.
It is vital for Dilmah to assess leads to opportunity conversion ratio on daily bases, as not all the
leads are converting in to qualified leads. By this way DIlmah can identify and trigger the
effectiveness of canvassing different leads in diversified markets, and sales team to identify
organizations requirement and customer assessing standards which will eliminate the risk of
lower lead to opportunity ratio.
Measuring the opportunities turning in to real sales will give the first hand idea for product and
performance improvement. Also it is important to track number of days it takes to lead to convert
in to a sale. This will reflect the areas of improvement required in overall sales funnel and sales
persons as individuals.
Key sales activities are number calls, meetings and emails achieved in each month. This will reflect
the effectiveness of the work load carrying on by each team member to achieve their month end,
year end targets.
By regular reviewing of sales reps pipelines, leaders can identify possible gaps in reaching
targets and create action plans ahead. This will further monitor the weekly, monthly, quarterly
sales target of each member.
Product performance.
Team leaders can notice trends certain products and reluctance or difficulties in selling certain
products. This KPI reflects the competitions and possible market trends or positive effect of
marketing efforts.
Dilmah use a varied motivational tools to manage sales team in a timely manner.
Sales team is given a target with their own pace to make schedules and process of achieving
them. Weekly team meetings are held to discuss the future game plan. Mentoring is used to
provide the guidance and confident in young sales members.
Dilmah offers their sales team, commission, perks and bonuses, achievement allowances align
with sales targets and achievements and these triggers have become extremely popular within
sales team.
Sales team are given free foreign training to gain the exposure in international context.
Teas and snacks are daily provided to staff and they all get free medical healthcare facilities as
well.
Effective and customer integrated communication is vital it can lead to the ultimate make or
break moment of the business. Effective communication can lead to increased sales, repeat
business and further referrals for more favorable opportunities whilst ineffective communication
leads to unsatisfied customer with lower brand loyalty as a whole.
Telephone communication
Customer service and generating leads through phone calls will give an more task oriented,
expedite method to integrate and generate new business leads to sales and distribution team.
However the method is more effective when delivers with more improved service standards to
offer better customer experience and communication.
It is vital to nail the first impression when communicating via telephones, and identify the
customer requirement through listening to the customer. Telephone is more effectively integrated
communication method with the clients and more productive results can be expected through
established client relationship.
Direct mail
Another direct marketing, lead generation and communication method. Direct mail will be send
to identified client base and handled closely with a view of profitable and potential business
opportunities.
Free, regular newsletter system will inform a potential customer about the company and by
providing good content customer will know more about the company and if done correctly, will
create more engaged and educated customer who will remained loyal to company in longer run.
Arranging a meeting with a prospective client may increase the opportunity of converting the
potential lead in to a sale if handled mindfully and professionally. This most direct, customer
integrated communication method will establish better customer relationships as well as well
identified client requirements by the sales rep.
Social Media
With the development of technology and using and engaging of with social media, more
customer integrated and interacted sales, distribution and organizational marketing plans can be
carried out.
The most effective ways of developing face book communities, Youtube, Whatsup, viber groups
will increase the visibility of company within a targeted customer segment. Further through this
MSC 19-57-1322 Page 18
way company is able to maintain a ore informed customer about the company, product and its
latest news. Company is further enable with the idea generation and feedback on their certain
new developments from their community and same will build more active and loyal customer
base around the company.
Content creation is now a days very common but powerful branding, marketing and selling tool
to engage customers and generate new business leads. An effective website and blog that offers
customer more indepth details on products and its varied usage, better integrated system which
provides and answer customer queries effectively and efficiently will improve the customer
service standards whilst creating a more engaged and informed customer.