TABLE OF CONTENTS

SL Chapters Pages

1.0 Executive Summary 4

2.0 Methodology 4

5.0 Introduction 5

6.0 Marketing Audit 6-11

7.0 Marketing Planning 12-16

8.0 Evaluation Report 17- 18

9.0 Bibliography 19

10.0 Reference 19

11.0 Appendix 20-23

Executive summery: This industry was established at June 2010 and recently wants to settle on commercial

production. Before doing this, a brief marketing plan is needed. Because, it is an important issue

that without planning the whole preparation would be failed. From marketing audit there is

identified some information about its market, customers, competitors, distributors and some other

internal and external issues.

There have found many opportunities and some threats in the market. The plan is helps this

industry to utilize those opportunities and reduces or control the threats. Moreover, firm should

not go for segmenting their market rather differentiate their product in their customers mind by

giving something new and do the best. By adding value company can make its profit higher rather

reducing their price. There is a brief discussion about how can facilitate a cost leadership

advantage. They use some new technologies and sophisticated machine so it is needed to make

skill their labors. Because, high technology would be danger if anyone can’t handle it properly.

Implementation is needed for any plan so; management should allocate their resources in proper

way.

It has no doubt that this plan if implemented in the right ways will achieve the desired outcome

for launching there new product in the market and setting a new standards for socks industry in

the Bangladesh.

Methodology:

Preparing for this marketing plan I get information from primary and secondary data.

Primary data: Primary data are collected from survey, FGD with some experienced persons,

deep discussion with company’s Chairman, Managing director and other responsible persons.

Secondary data: From websites, articles, journals, previous student’s reports and other sources

secondary data are collected.

Introduction: This marketing plan is concerned with the development of strategies that are based on the

planning term’s measurement of the market and perceptions of managerial expectations and

organizational capability. Various tools and terms are used for medium term planning marketing

strategy under this process:

This report is structured to discuss the following:

Analyze the situation

Set the realistic objectives

Generate ideas and develop sensible strategies

Choose different tactics to support strategies

Implementation the strategies with action plan

Control, monitor, measure, report and adjust.

Marketing Audit / Current Situation: Marketing audit is identified as a crucial part of a professional marketing planning process. It is

nothing but an analysis to find out the past and present situation of an organization. There are

various internal and external factors which influences the company’s current situation. For this

reason marketing audit describes those factors so that we can make decision what will be our

strategy for making effective marketing plan.

Overview of the market:

Market

- The fastest growing industry in Bangladesh with Readymade Garments (RMG) accounting for

more than 75% of total exports.

- Bangladesh is best place in the region for textiles and garments because of cheap labor and trade

status with the EU.

- Sock industry is under the criteria of Readymade Garments (RMG). So, it would be great

opportunity for launching this product.

- Though most of the people (about 70%) people live in rural area urbanization is not stop in

recent years. Country people are getting education and office going people are growing. Demand

of sock is increasing day by day both urban and rural area.

- The population in Dhaka city is more than 7.0 million (est. 2008) and the population is growing

by an estimated 4.2% per year and literacy rate is 62.3%.

-

Competitors:

- There have a small number of sock industries (i.e. Total Socks Ltd., Prag Socks, Hamim Socks,

Savar Socks Ltd., Zara Socks etc.). Prag, Zara and Hamim go for product branding. But their

product quality and production capacity is not same as Classsical Socks.

- Prag has two sock’s outlet in Dhaka (Capital city of Bangladesh) city. From their outlet Prag

make order for retail and wholesale. They have few Indian machines and poor production

capacity, so they cannot go for export or make huge order.

- Total Sock is not interested for local market. Their production capacity is 1.5 lac / month. This

industry is using Korean machine and technology similar to Classical Sock.

- Zara and Hamim go for product branding in the local market. But they can’t get success in this

market due to lower quality and lack of strong positioning.

- Sometimes retailers changing the tags and telling customers this sock is made in France, China,

India, Thailand. People not to buy brand or quality, people just buy the name of made in or

attractive packet.

Customers:

- We found most of the customers are living in urban area, educated, students, and office going

executives.

- Male prefers socks rather than female in Bangladesh. Because female prefers sandal shoes

rather than shoes.

- Customers are not aware of local socks brand. Most of them go branded shoe stores (i. e. Bata,

Apex, Jennys, etc.) or road side socks stalls. Sometimes they buy Nike, Power, Foreman, Addidas

and many other tagged socks. Even the socks are not produced by those companies. Interesting

thing is Bata, Apex, Jennys are not sock manufacturer.

- Customers are price sensitive. In the survey question we got, 52% people considerd the price as

their first choice while go for buy socks. Moreover they (customers) put their first choice for

quality 36%, 4%for style, 3% for design and 5% for color. (plesase see the appendix-D)

- None of them can recall the brand name of Zara, Hamim sock from their memory. Only 1%

people know the name Prag socks and buy from their outlet

- Branded shoe stores have huge demand of socks. Bata country (Bangladesh) production

manager- Mr. Mefuj Ahmed says, “We have demand of 15 million socks per year. Most of the

time local manufactures fails to provide that orders and quality what we needed.”

Analyze the Macro and Micro Environment:

The below three analyses will represent both macro environment (political / legal, economic /

demographic, social / cultural, and technological) and micro environment (customers,

competitors, distributors and suppliers):

PEST analysis

SWOT analysis

Porter’s five forces

PEST analysis: PEST analysis is the most common and important tool for marketing audit.

Political analysis / legal:

Bangladesh is a country of river and has tropical monsoon-type climate, with a hot and rainy

summer and a dry winter. The government is followed by parliamentary democracy.

Legislation: The legislations in force are as follows:

Patent and design act of 1911

Patent and design rule of 1933

Trademark act 1940

Copyright act of 1999

Government polices for foreign investment:

There are equal similarities between foreign and domestic private investors regarding investment

incentives or export import polices in Bangladesh. Incentives for investors: 100% ownership in

most sectors; tax holidays; reduced import duties on capital machinery and spares; duty free

imports for 100% exports; and tax exemptions.

Economic analysis:

Economy situation:

In 2011 Bangladeshis per capita income is estimated US$1,700 (adjusted by purchasing power

parity) which is increasing. But this income is significantly lower than India and Pakistan, both

which are also lower than the world average of US$10,497. The economic growth rate is 6-7%

per annum over the past few years. There more than half of the GDP belongs to the service

sector; almost half of the Bangladeshis are employed in agriculture sector, with RMG; fish

vegetables, lather and lathe goods, ceramics, rice and others produce. The ease of doing business

rank is 107th position.

Bangladesh corporate tax rates: In 2008 – 2009 tax years corporations tax rate are as follows:

Publicly traded company 27.5%

Non publicly traded company 37.5%

Bank, Insurance & Financial company 45%

Mobile phone operator company 45%

If any publicly traded company (excluding Mobile Operator Company) declares more than 20%

dividend, the company is allowed 10% rebate on total tax.

Social analysis:

Bangladesh has the highest population density in the world, excluding a handful of city-states and

small countries such as Malta.

Demographics of Bangladesh:

Population: 156,050,883 (July 2010 est.)

Growth rate: 1.292% (2009 est.)

Life expectancy: 60.25 years

Age structure:

0 – 14 years: 34.6% (male 24,957,997/female 23,533,894)

15-64 years: 61.4% (male 47,862,774/female 45,917,674)

65-over: 4% (male 2,731,578/female 2,361,435) (2006 est.)

Here major Ethnic group is Bengali and minor ethnic are Santhal, Chakma, Garo, Bihari, Oraon,

Munda, Rohingya. Official language is Bengali, people spoken in Bengali, Tribal languages and

English. Mega-city of Dhaka has a huge population, but the majority of the people nonetheless

still live in villages in rural areas.

Technological analysis:

Bangladesh has been struggling to achieve their basic needs of its people. Besides their living cost

and inflation rate is increasing day by day. Bangladesh Government takes some initiative for their

technological advances and ICT related projects. Some foreign technologies come to this country

and produce machineries and other technological equipments and developing roads and highways

in recent years. Also there is improvement at telecommunication sectors and digital media

sectors. There have allowance and duty free facilities for importing computer and IT related

products in Bangladesh.

SWOT analysis: One of the most important tools of marketing audit is the SWOT analysis or

Strengths, Weakness, Opportunities, Threats analysis.

Strengths:

1. Financial capability: There have strong financial capability of this industry.

2. Suitable Location: This factory is situated alongside Dhaka – Sylhet high way and

there have enough parking area for loading and unloading goods and materials. For this

reason suppliers and buyers can easily communicate with this factory.

3. Management expertise: Managing director and other managing body has more than

20 years business experience at garments and textiles sector.

4. Large factory space: There have more than 6500 sqf. space for knitting and finishing

area. Because of two stored building there have enough space for warehouse keeping

their stocks, cottons and other materials.

5. Production capacity: There have more than 1lac pair socks production capacity with

good quality per month.

6. Intangible factors (Such as brand): Their brand name is Classical Socks is a product

of I. Ahmed Textile Mills Ltd. This industry is a sister concern of Classical Home Tex

Ind. Ltd. Locally Classical is a very well reputed brand for home textiles.

Weakness:

1. Raw materials: This industry is highly dependent on cotton. Bangladesh also much

more dependent on other foreign countries for this raw material.

2. Dependent on local buyer: Till now this firm is not targeting foreign buyers. So,

most of their socks buyer is local and not willing to pay more though raw material

cost is increasing.

3. Unskilled/uneducated labor: Only 2% workers have academic certificate or have

technical certificate.

4. Energy maintenance cost: There is not sufficient power supply in this country. For

this reason, they are dependent on generator which increases the industry energy

maintenance cost.

Opportunities

1. Demand of quality socks: Business buyers like Bata Shoe Company (Bangladesh)

Ltd., Apex Footwear Ltd., and Bay have huge demand for quality socks.

2. Emerging new technologies: Emerging new technologies socks knitting machine

suppliers will supply advanced machine by which sock’s core quality will improve.

3. Increasing new shopping malls: Local shopping malls and shoe stores are

increasing. For that reason, socks demand will be high at that retails outlets.

4. Increase purchasing power: Bangladeshis disposable income and purchasing

power is increasing gradually.

5. Not enough competitors: There have many garments factory in this country but

have few of them interested in sock industry.

Threats:

1. Existing competitors: Already Comfort socks and Total socks are enjoying fast

mover advantages.

2. Other developing countries: Competition from other developing countries like

China already captured international market and using modern technology.

3. Duty free textile machinery: Allowance of duty free textile and garments machinery

is an opportunity of other competitors.

4. Local banks have not sufficient reserves: In recent year banks and other financial

institutions reserve is not good because of stock market corruption and some other

reasons.

5. Balance between price and quality: There is a challenge for making balance

between price and quality.

Porter’s five forces model: According to Porter (1980) the competitive structure of an industry

can be analyzed using Porter’s five forces. This model attempts to analyze the attractiveness of I.

Ahmed Textile Mills by considering five forces within a market. In this analysis micro-

environment factors (customer, competitor, distributor and supplier) are considered. Those five

forces are defined as:

1. The likelihood of new entry:

Socks knitting machine is highly sophisticated and technological based. For example:

There must have proper air passing system with each and every machine. After machine

installation the whole knitting room will have to control air temperature for continuous

production. So this types of industry has high entry cost.

Bangladesh government imposes high tax for imported readymade garments. For this

reason it is a great opportunity for local manufactures of readymade garments.

Majority of local customers are not loyal for brand socks (See the page 5, market

overview). But there have huge demands of socks in local and international market.

There have huge demands for quality sock in the existing market. But it should be in

reasonable price.

2. The power of buyers:

I. Ahmed targets some business buyers who have needed quality socks (i.e. Bata Shoe

Company Ltd., Apex Footwear Ltd., Jennys Footwear Ltd. etc.). Those firms are few in

number, so buyers have more bargain power for reducing price.

Business buyers can’t switch another provider easily while they searching for high-

quality socks. Because, there have few providers who are capable for providing high-

quality socks. Local wholesalers can easily switch another provider. Moreover, they are

concern about their sales commission rather than quality.

3. The power of supplier:

There have many cotton suppliers in local market. A big retail market is in Narayngonj

named Tanbazar. All of those suppliers manage cottons from knitting garments which

price is more or less same. So, there have many options for buyers. But the thing is one

supplier can’t provide large quantity of similar color cotton at a time. For this reason,

sometimes buyers depend on suppliers and have to pay high price due to unavailability

of same types or same color cottons in market.

Switching to another supplier is not so difficult or expensive at this market. In this

situation suppliers don’t have more power.

In this year international cotton market was out of controlled and fluctuated. So, local

suppliers can easily playing game in recent year. Besides, Uzbekistan, India and some

other countries stop exporting cottons.

4. The degree of rivalry:

There have few dominant firms where high competition does not exist.

Cost for leaving is high for this type of large firms. Because there have some high

installation cost and machines resell value is not good enough.

Bangladesh is an over populated and developing country. Moreover educated persons and

office executives are increasing gradually. Because there are rising many multinational or

group of companies. Educated and officials are the end users of this product. So, market

is expanding and firms can easily gain their profits and sales.

There is little brand loyalty in the market so customers of socks are likely to switch

easily between products.

5. The substitute threats:

In summer season there is so much sun in Bangladesh. Most of the People prefer sandal

shoes in summer time. For that reason socks demand is fallen down at summer season.

(For detail analysis, please see page-5, Overview of the Market )

Porter’s five forces used at I. Ahmed Textile Mills Ltd.

Assumptions:

From that discussion some assumptions come out:

1. There have much potential in the current market.

2. Market is expanding so always be careful about new entrants and existing competitors.

3. Customers are sensitive, so do the best thing and do the thing best.

4. Bangladesh economy is stable. It could be opportunity for launching new product.

Similarly it may be a threat while other competitors use that possibility.

5. Check and balance between demand and supply.

- Shoe sandal is substitute

for shoes at summer time.

- Business buyers can’t

switch to another industry

easily.

- Business buyer’s have

bargain power in some

cases.

- Consumers can easily

switch.

- Depends on local cotton

supplier for raw materials.

- Switching to another

supplier is not costly.

- Local suppliers have

- Have few dominant

companies.

- Cost of leaving is high.

-Existing market is

expanding.

- Little brand loyalty in the

existing market.

1.0 - Time and Demand of

quality socks in existing

marketSources of raw

materials

2.0 Dependent on local buyers

3.0 Unskilled & uneducated

labors

4.0 High maintenance cost of

energy, machinery

equipments.

- xisting market

high entry cost.

- Great opportunity for local

manufacturer.

- Local customers are not brand

loyal.

- Huge demand of quality socks.

-Government policy is not so

hard.

The power

of buyer

Likelihood

of new

entry

The power

of supplier

The

substitute

threats

The degree

of rivalry

Marketing Plan: It is obvious that without planning it is not possible to achieve the goal what you want to be or

where you want to reach.

Mission:

Try to be number one manufacturer within 3 year due to capacity and quality.

Objectives:

There have few objectives for marketing plan of this industry. Objectives should be clear,

measurable and have a stated time frame for achievement. The below objectives are subject to

SMART criteria, that makes sure chosen objectives are Specific, Measurable, Achievable,

Realistic and Time-related.

Obj. # 1: Within 3 months achieve best output from machine.

This objective can make sure the quality of the core product.

Obj. # 2: Try to achieve 80%production of total machine capacity within 6 month.

Till now this industry is testing their machine and not going for commercial production. It will be

generate the overall efficiency of this industry.

Obj. # 3: Reducing overhead cost and making balance between cost and price.

As a new industry there have many mistakes and lack of knowledge about sock’s knitting

machine. Labors must be aware of the overhead cost and maintenance process of new high

technical machine. Price should be reasonable.

Obj. # 4: Increase sales in retail stores by 20% within 1 year.

Obj. # 5: Make this industry as a trusted manufacturer within 1 year.

Establish its trusted brand name (Classical Socks) in customers mind.

Strategy:

Johnson and Scholes (Exploring Corporate Strategy) define strategy as follows:

"Strategy is the direction and scope of an organization over the long-term: which achieves

advantage for the organization through its configuration of resources within a challenging

environment, to meet the needs of markets and to fulfill stakeholder expectations".

An organization takes different strategy in different way due to their particular objectives and

purposes. Strategy has no value if there is not found any action and action should be measure by

resources and other factors. Company’s strengths and opportunities can be used for reduces

weakness and control threats. If we use the strengths and opportunities in a competitive way by

following strategy it will be helpful for achieving the goal.

So, we come to know why we should follow strategies for an organization. Here this industry’s

SWOT transformed to TWOS by following some strategy.

How I. Ahmed Textile Mills Ltd. used the TOWS matrix in its sock division:

The TOWS matrix (adapted from Weihrich, 1982) 9

Target market: I. Ahmed Textile is neither a retailer nor a trader. They are only manufacturing

the socks. For this reason if, this industry can’t utilize its product capacity or can’t 100% sale of

its total production it is obvious it’s per unit production cost will be high. In this case, this

industry should targets:

Large quantity buyers (Bata Shoe Com., Apex Footwear, Jennyes Etc.)

Wholesalers

Importers (Develop new market)

Internal Strengths: - Enough financial

capability

- Suitable location

- Management Expertise

- Large factory space

- Production capacity

- Intangible factor (i.e.

Brand name)

Internal Weakness:

- Sources of raw materials

- Dependent on local buyers

- Unskilled & uneducated

labors

- High maintenance cost of

energy, machinery

equipments.

Strategies

Tactics

Actions

External Opportunities: - Demand of quality

socks in existing

market

- Emerging new

technologies

- Increasing new

shopping malls

- Increasing purchasing

power of parity of

customers.

- Not enough

competitors in existing

market

External Threats:

- Existing competitors

- Other developing

countries

- Duty free for textile &

garments machineries

in Bangladeshi market

- Recent financial crises

in local bank

- Balance between price

& quality

W-O strategy - Trying to catch new

market(market

development)

- Develop HR and R&D

sector

- Reduce maintenance cost

S-O strategy - Increase production

capacity

- Purchase new machines

- Develop new brand and

design and quality

- Promote the brand

S-T strategy - Reduce production cost

- Develop new

technologies and

logistics

- Develop customer

relationship

management

W-T strategy - Waiting for bank’s stable

position

- Product development

So, this industry goes for planning how to serve those buyers and how to make ensure quality

with minimum cost of production. There have huge demand of sock at business buyers. (See the

explanation at page-5, Market overview)

Positioning statement:

Classical Socks – A brand you can trust.

It will not be a wise decision to go narrow market for I. Ahmed Textile Mills Ltd. Because, this

industry has large capacity and trying to reach at the number one position of socks manufacturer

in Bangladesh. For that reason, as large volume industry areas of differentiation would be:

Product

Distribution

Image

Product Differentiation: The following uniqueness can give competitive advantage:

The size, shape and the components of the sock. For example, manufacturer present plain

socks with formal or simple design. But there are lots of youngsters wear plain socks

without satisfy the socks design, shape or color. Because, there have changed at

Bangladeshi culture, people’s psychology, thinking and behavior etc.

The product performance and quality can be a measurable issue. Form our research we

found that people define the quality of sock’s by elasticity, cottons, color durability etc.

(see appendix – D)

The product performance consistency, that means hold the same quality for all orders.

Distribution: In Bangladesh retail stores sales sock by single pair and there is a tradition that

socks must be covered by plastic bag. It is manufacturer responsibility to package all of the

products for end users. In this case, while Manufacturer Company distributes their products they

must aware of how they package and how they distribute?

It is important for this industry develop their website for making foreign buyer.

Business buyers give order for a month, but want delivery twice or thrice in a month. So,

there must have the arrangement of transportation for delivering goods with good

condition.

Unique channel--offer a service over the phone or Internet instead of in person or in their

office rather than manufacturer.

Image: Manufacturer while choose wholesales or business buyers, generally they are not concern

about creating brand image if they can’t use their brand name on the product. This industry has to

think different way:

Bangladesh Government arraigning Trade Fare in every year. Lots of foreign countries

are come together with their various products. I. Ahmed Textile has to go for promoting

their product (Classical Socks). In this way they can make influence the foreign business

buyers.

Customer relationship management can create its image to their customer.

Though first time this industry becomes much depended on their business buyers, it will

not be wise decision in long term it is continuing. Besides, they can’t make profit much if

they can’t reach the end users. Bata and other business buyers are not selling others brand

though they selling others product. In this situation, this industry may arrange press

conference and take another public relation activities. For example, this industry may

arrange seminar, invite their buyers give chance to say something and forecast it by

popular TV, Radio, and Press media.

Similarly this industry has to be cost leadership in different way: It is needed also be a cost

leadership in different way for a firm. Because, without minimize their cost they can’t get profit

though they differentiate their product. In this present situation of the world there always

recession is occurred. For this reason, we must concerned about to reduce or control our cost but

not stop adding value. So, it is important to follow the bellow techniques:

Labor efficiency

Standardization, specialization, and methods improvements

Technology-Driven Learning

Better use of equipment

Changes in the resource mix

Product redesign

Network-building and use-cost reductions

Shared experience effects

Actions:

Risk management:

There may have something that could be wrong with this company. The marketing plan for the

new product / service may not implement within this industry.

A risk management process should be in should any of the below incidents occur:

Lack of knowledge about new machine and handling tools.

Unskilled cheap labor selected.

Lack of budget

Communication gap between industry and head office.

Action plan:

The below chart describes the action plan for the year: Activity Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec

Building the team X

Allocate the

planning budget

X

Launch an

informational

brochure

X

Choose CRM system X

Choose distributors X X

Build supply chain

management

X X

Develop the website

and upgrade

X X

Develop design of

the product

X X X X

Create a launch

event and invite

media

X X

Trained the quality

control team

X

Arrange internal

seminar

X

Building strong

communication with

buyers even vacation

X

It will take time for every planning and implementing. But from the first we have to concern

about what would be our action and how to control the present situation. Consequently, company

top management should make clear the plan and organizational goals. As a new established

industry the must to make it complex. Because, all of the stuffs and employees are new to this

organization and it’s working environment. Sometimes, even a hard and complex task would be

easy while management take the instant initiatives in easy way.