Matco Foods - Report PDF

MBA PROJECT 2018
6/14/2018
MATCO FOODS
“Feasibility study of
Breakfast Cereal in Pakistan”
Client: Ms. Wajiha Khan (Matco Foods)
Project Coordinator: Dr. Nasir Afghan
Project Advisor: Dr. Ahmad Junaid
Group Members
WALEED SALEEM (11830) HERA NISAR (11816)

HASHAM ZAHID (11810) SYED ANEEQ IMTIAZ (11798)
AHSAN AHMAD (11828) HASHIR SOHAIL (11827)
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TABLE OF CONTENTS
TABLE OF TABLES ............................................................................................................................................. 15
TABLE OF FIGURES ........................................................................................................................................... 17
Chapter 1: PROJECT BRIEF............................................................................................................................. 19
1.1: Summary .................................................................................................................................................. 19
1.2: Project Scope........................................................................................................................................... 20
1.3: Management Objectives ..................................................................................................................... 20
1.2.1 Target Market .................................................................................................................................. 20
1.2.2 Competition ...................................................................................................................................... 20
1.2.3 Location Strategy ............................................................................................................................ 20
1.2.4 Name Strategy ................................................................................................................................. 20
1.2.5 Price Strategy ................................................................................................................................... 20
1.2.6 Product Strategy ............................................................................................................................. 21
1.2.7 Place Strategy................................................................................................................................... 21
1.2.8 Organization Capacity................................................................................................................... 21
1.4: Research Objectives ............................................................................................................................. 21
1.5: Project Deliverables ............................................................................................................................. 22
Chapter 2: RESEARCH METHODOLOGY .................................................................................................... 23
2.1: Summary .................................................................................................................................................. 23
2.2: Research Methodology........................................................................................................................ 24
2.2.1: Secondary Research ..................................................................................................................... 24
2.2.2: Primary Research .......................................................................................................................... 25
2.2.2.1: Market Survey and Interviews (LMT, IMT, Retailers) ........................................................ 25
2.2.2.2: Focus Groups ..................................................................................................................... 25
2.2.2.3: In-depth interviews ............................................................................................................ 26
2.2.2.4: Consumer Surveys.............................................................................................................. 26
Chapter 3: LITERATURE REVIEW ............................................................................................................... 27
3.1: Summary .................................................................................................................................................. 27
3.2 History of Breakfast cereals ............................................................................................................... 28
3.3: Today Time - The last 25 Years .................................................................................................. 29
3.4: Types of Cereals ..................................................................................................................................... 30
3.5: Consumer Perception .......................................................................................................................... 30
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3.5.1: Procedure to make Breakfast Cereals ................................................................................... 30
3.5.2: Sugar Content ................................................................................................................................. 31
3.5.3: Presence of Genetically Modified Organisms (GMOs) .................................................... 31
3.6: Approach by producers - Categorization ..................................................................................... 32
3.6.1: Breakfast cereals Packaging...................................................................................................... 32
3.6.1.2 Adults .................................................................................................................................. 32
3.6.1.2 Children ............................................................................................................................... 32
3.6.2: Brand Awareness .......................................................................................................................... 34
3.6.3: Character Merchandizing ........................................................................................................... 34
3.7: Usage Level .............................................................................................................................................. 35
3.7.1: Cereals as Functional Food ........................................................................................................ 35
3.7.2: Prevention of Heart Failure....................................................................................................... 35
3.8: Product Attributes ................................................................................................................................ 36
3.8.1: Flavor ................................................................................................................................................. 36
3.9: Purchase intentions: Advertisements ........................................................................................... 36
3.10: Market Share ........................................................................................................................................ 36
3.10.1: Share in Pakistani Market ....................................................................................................... 37
Results from Chapter 3 ................................................................................................................................ 38
Chapter 4: COMPANY ANALYSIS .................................................................................................................. 39
4.1: Matco Foods ............................................................................................................................................ 40
4.2: Products Portfolio ................................................................................................................................. 41
4.3: SWOT Analysis ....................................................................................................................................... 41
4.3.1: Strengths........................................................................................................................................... 41
- 4.3.1.1: Already in Rice business -........................................................................................... 41
- 4.3.1.2: Strong distribution network - .................................................................................... 41
- 4.3.1.3: Global presence - ....................................................................................................... 42
- 4.3.1.4: Strong brand name - Falak basmati rice - .................................................................. 42
- 4.3.1.5: Plant in Karachi (lower transportation cost) -............................................................ 42
4.3.2: Weaknesses ..................................................................................................................................... 42
- 4.3.2.1: No prior experience in breakfast cereal industry - .................................................... 42
- 4.3.2.2: Weak Marketing - ...................................................................................................... 42
4.3.3: Opportunities .................................................................................................................................. 43
- 4.3.3.1: Huge Growth Potential - ............................................................................................ 43
- 4.3.3.2: Increasing health consciousness - .............................................................................. 43
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- 4.3.3.3: Rural Areas - ............................................................................................................... 43
- 4.3.3.4: General Trade - .......................................................................................................... 43
- 4.3.3.5: Patients - .................................................................................................................... 43
- 4.3.3.6: Offer more variants -.................................................................................................. 44
- 4.3.3.7: Untapped Rice market - ............................................................................................. 44
- 4.3.3.8: Population - ................................................................................................................ 44
4.3.4: Threats .............................................................................................................................................. 44
- 4.3.4.1: High competition (both domestic and International) -.............................................. 44
- 4.3.4.2: Promotional Offerings from competitors - ................................................................ 44
- 4.3.4.3: Competitor dominance in trade channels - ............................................................... 45
- 4.3.4.5: Dominant market is corn and wheat - ....................................................................... 45
- 4.3.4.6: Fuel price increase - ................................................................................................... 45
- 4.3.4.7: Adverse currency exchange rate fluctuation - ........................................................... 45
Chapter 5: SECONDARY RESEARCH ........................................................................................................... 47
5.1: Summary .................................................................................................................................................. 47
5.2.: Global Trends......................................................................................................................................... 48
5.2.1: Fast and Functional ...................................................................................................................... 49
5.2.2: Hot Cereals are gaining ground ............................................................................................... 49
5.2.3: Breakfast Anytime ........................................................................................................................ 49
5.2.4: Age of Customization ................................................................................................................... 50
5.3: Trends in Context of Pakistan .......................................................................................................... 50
5.3.1: Target Market ................................................................................................................................. 51
5.3.1.1: Health Consciousness youth .............................................................................................. 51
5.3.1.2: Working women and Housewives ..................................................................................... 51
5.3.2: Competitive Landscape ............................................................................................................... 52
5.3.3: Place strategy .................................................................................................................................. 53
5.3.4: Price Strategy .................................................................................................................................. 54
5.3.5: Product Strategy ............................................................................................................................ 55
Chapter 6: INDUSTRY ANALYSIS ................................................................................................................. 57
6.1: Summary .................................................................................................................................................. 57
6.2: Industry Trends ..................................................................................................................................... 58
6.3: Market Landscape ................................................................................................................................. 60
6.4: Prospects of Cereal Industry ............................................................................................................ 61
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6.5: Porter Five Forces Model ................................................................................................................... 63
6.5.1: Rivalry Among Competitors...................................................................................................... 63
6.5.2: Potential Entry of New Competitors ...................................................................................... 63
6.5.3: Potential Development of Substitute Products ................................................................. 63
6.5.4: Bargaining Power of Consumers ............................................................................................. 63
6.5.4: Bargaining Power of Supplier .................................................................................................. 64
6.6: Competitor Profile Matrix .................................................................................................................. 64
Chapter 7: MARKET RESEARCH ................................................................................................................... 66
7.1: Summary .................................................................................................................................................. 67
7.2: Market Survey ........................................................................................................................................ 68
7.3: LMT/IMT 7.3.1: Objective ............................................................................................................... 68
7.3.2: Scope of LMT/IMT ........................................................................................................................ 68
7.3.3: Findings............................................................................................................................................. 68
7.3.3.1: TARGET MARKET ................................................................................................................ 69
7.3.3.2: COMPETITION .................................................................................................................... 69
7.3.3.3: PRODUCT NAME ................................................................................................................ 69
7.3.3.4: PRICE .................................................................................................................................. 70
7.3.3.5: PRODUCT ........................................................................................................................... 70
7.3.3.6: PLACE ................................................................................................................................. 70
7.3.3.7: MATCO’s PERCEPTION ....................................................................................................... 71
7.4: General Trade ......................................................................................................................................... 71
7.4.1: Objective ........................................................................................................................................... 71
7.4.2: Scope of General Trade ............................................................................................................... 71
7.4.3: Findings............................................................................................................................................. 72
7.4.3.1: TARGET MARKET ................................................................................................................ 72
7.4.3.2: Competition ....................................................................................................................... 72
7.4.3.3: PRODUCT NAME ................................................................................................................ 73
7.4.3.4: PRICE .................................................................................................................................. 73
7.4.3.5: PRODUCT ........................................................................................................................... 73
7.4.3.6: PLACE ................................................................................................................................. 74
7.4.3.7: MATCO’s PERCEPTION ....................................................................................................... 74
7.5: In-Depth Interviews ............................................................................................................................. 75
7.5.1: Doctors .............................................................................................................................................. 75
7.5.1.1: Objective ............................................................................................................................ 75
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7. 5.1.2: Scope of Interview ............................................................................................................ 75
7. 5.1.3: Findings ............................................................................................................................. 75
7.5.1.3.1: RECOMMENDATIONS ................................................................................................. 75
7.5.1.3.2: AGE GROUPS ............................................................................................................... 76
7.5.1.3.3: BRAND PREFERENCE ................................................................................................... 76
7.5.1.3.4: REASONS FOR CONSUMPTION ................................................................................... 76
7.5.1.3.5: RESERVATIONS ............................................................................................................ 77
7.5.2: Suppliers ........................................................................................................................................... 77
7.5.2.1: Objective ............................................................................................................................ 77
7.5.2.1.1: International Brands Limited ...................................................................................... 77
7.5.2.1.2: Objective ..................................................................................................................... 77
7.5.2.1.3: SCOPE OF INTERVIEW ................................................................................................. 78
7.5.2.1.4: FINDINGS..................................................................................................................... 78
7.5.2.1.4.1: TARGET MARKET .................................................................................................. 78
7.5.2.1.4.2: COMPETITION ...................................................................................................... 79
7.5.2.1.4.3: PRICE .................................................................................................................... 80
7.5.2.1.4.3: PRODUCT ............................................................................................................. 80
7.5.2.1.4.4: PLACE ................................................................................................................... 80
7.5.2.1.4.5: TASTE ................................................................................................................... 81
7.5.2.1.4.6: MARKET GROWTH ............................................................................................... 82
7.5.2.1.4.7: DEMAND FORECAST............................................................................................. 82
7.5.2.1.4.8: SCOPE OF RICE CEREALS ...................................................................................... 83
7.5.2.1.4.9: RESEARCH & DEVELOPMENT ............................................................................... 83
7.5.2.2: Burque Corporation Private Limited .................................................................................. 83
7.5.2.2.1: Objective ..................................................................................................................... 83
7.5.2.2.2: Scope of Interview ...................................................................................................... 83
7.5.2.2.3: Findings ....................................................................................................................... 84
7.5.2.2.3.1: TARGET MARKET .................................................................................................. 84
7.5.2.2.3.2: COMPETITION ...................................................................................................... 84
7.5.2.2.3.3: LOCATION ............................................................................................................ 84
7.5.2.2.3.3: PRICE .................................................................................................................... 85
7.5.2.2.3.3: PRODUCT ............................................................................................................. 85
7.5.2.2.3.4: PLACE ................................................................................................................... 85
7.5.3: Competitors ..................................................................................................................................... 86
7.5.3.1: Objective ............................................................................................................................ 86
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7.5.3.1.1: FAUJI CEREALS............................................................................................................. 86
7.5.3.1.2: Objective ..................................................................................................................... 87
7.5.3.1.3: Scope of Interview ...................................................................................................... 87
7.5.3.1.4: Findings ....................................................................................................................... 87
7.5.3.1.4.1: TARGET MARKET .................................................................................................. 87
7.5.3.1.4.2: COMPETITION ...................................................................................................... 88
7.5.3.1.4.3: LOCATION ............................................................................................................ 88
7.5.3.1.4.4: PRICE .................................................................................................................... 89
7.5.3.1.4.5: PRODUCT ............................................................................................................. 89
7.5.3.1.4.4: PLACE ................................................................................................................... 89
7.5.3.1.4.5: MARKETING & SALES ........................................................................................... 90
7.5.3.1.4.6: BUSINESS OUTLOOK............................................................................................. 90
Chapter 8: FOCUS GROUPS & IN-DEPTH INTERVIEWS ...................................................................... 92
8.1: Summary .................................................................................................................................................. 93
8.2: Focus Groups .......................................................................................................................................... 93
8.2.1: Objective ........................................................................................................................................... 93
8.2.2: Analysis of Focus Group – Male Students ............................................................................ 93
8.2.2.1: Objective ............................................................................................................................ 93
8.2.2.2: Mechanism and Dynamics ................................................................................................. 94
8.2.2.3: Findings .............................................................................................................................. 94
8.2.2.3.1: Attributes: ................................................................................................................... 94
8.2.2.3.2: Social Acceptance: ...................................................................................................... 94
8.2.2.3.3: Brand Experience ........................................................................................................ 95
8.2.2.3.4: Brand Attachment....................................................................................................... 95
8.2.2.3.5: Purchase Intention ...................................................................................................... 95
8.2.2.3.6: Usage Pattern ............................................................................................................. 95
8.2.2.3.7: Purchase Pattern......................................................................................................... 95
8.2.3: Analysis of Focus Group – Female Students ....................................................................... 96
8.2.3.1: Objective ............................................................................................................................ 96
8.2.3.3: Findings .............................................................................................................................. 96
8.2.3.3.1: Attributes: ................................................................................................................... 96
8.2.3.3.2: Social Acceptance ....................................................................................................... 97
8.2.3.3.3: Brand Experience ........................................................................................................ 97
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8.2.3.3.4: Satisfaction.................................................................................................................. 97
8.2.3.3.5: Loyalty ......................................................................................................................... 97
8.2.3.3.6: Purchase Intention ...................................................................................................... 98
8.2.3.3.7: Usage Pattern ............................................................................................................. 98
8.2.3.3.8: Purchase Pattern......................................................................................................... 98
8.2.4: Analysis of Focus Group – Children ....................................................................................... 99
8.2.5.1: Objective ............................................................................................................................ 99
8.2.5.3: Findings .............................................................................................................................. 99
8.2.5.3.1: Attributes .................................................................................................................... 99
8.2.5.3.2: Social Acceptance ....................................................................................................... 99
8.2.5.3.3: Brand Experience ...................................................................................................... 100
8.2.5.3.4: Brand Attachment..................................................................................................... 100
8.2.5.3.5: Purchase Intention .................................................................................................... 100
8.2.5.3.6: Usage Pattern ........................................................................................................... 100
8.2.5.3.7: Purchase Pattern....................................................................................................... 100
8.2.5: Analysis of Focus Group – Employed Women ................................................................. 101
8.2.5.1: Objective .......................................................................................................................... 101
8.2.5.2: Mechanism and Dynamics ............................................................................................... 101
8.2.5.3: Findings ............................................................................................................................ 101
8.2.5.3.1: Attributes .................................................................................................................. 101
8.2.5.3.2: Social Acceptance ..................................................................................................... 102
8.2.5.3.3: Brand Experience ...................................................................................................... 102
8.2.5.3.4: Satisfaction................................................................................................................ 102
8.2.5.3.5: Loyalty ....................................................................................................................... 102
8.2.5.3.6: Purchase Intention .................................................................................................... 102
8.2.5.3.7: Willingness to Pay ..................................................................................................... 103
8.2.5.3.8: Usage Pattern ........................................................................................................... 103
8.2.5.3.9: Pattern ....................................................................................................................... 103
8.3: IN-DEPTH INTERVIEWS ................................................................................................................... 104
8.3.1: Objective ......................................................................................................................................... 104
8.3.2: Female Student ............................................................................................................................ 104
8.3.2.1: Objective .......................................................................................................................... 104
8.3.2.3: Findings ............................................................................................................................ 105
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8.3.3: Male Student ................................................................................................................................. 106
8.3.3.1: Objective .......................................................................................................................... 106
8.3.3.3: Findings ............................................................................................................................ 107
Results from Chapter 8 .............................................................................................................................. 109
Chapter 9: CONCEPTUAL FRAMWORK ................................................................................................... 110
9.1: Summary ................................................................................................................................................ 111
9.2: Model of Research ............................................................................................................................... 111
9.3: Conceptualization ............................................................................................................................... 112
9.3.1: Consumers’ Confidence ............................................................................................................ 112
9.3.2: Brand Experience ........................................................................................................................ 112
9.3.3: Product Attributes ...................................................................................................................... 112
9.3.4: Satisfaction .................................................................................................................................... 113
9.3.5: Loyalty ............................................................................................................................................. 113
9.3.6: Purchase Intention ..................................................................................................................... 114
9.4: Operationalization .............................................................................................................................. 114
Chapter 10: DATA COLLECTION ................................................................................................................ 116
10.1: Summary .............................................................................................................................................. 117
10.2: Questionnaire..................................................................................................................................... 117
10.2.1: Structure ...................................................................................................................................... 117
10.2.2: Sample Size ................................................................................................................................. 118
10.2.2.1: Sample size variables ..................................................................................................... 118
10.2.2.1.1: Population Size........................................................................................................ 118
10.2.2.1.2: Margin of Error ....................................................................................................... 118
10.2.2.1.3: Confidence Level ..................................................................................................... 118
10.2.2.1.4: Standard of Deviation ............................................................................................. 118
10.2.3: Calculating sample size .......................................................................................................... 118
10.3: Data Collection................................................................................................................................... 119
10.3.1: Basic Variables........................................................................................................................... 119
10.3.2: Household Income ................................................................................................................... 121
10.3.3: Occupation .................................................................................................................................. 122
10.3.4: Occupation .................................................................................................................................. 123
Results from Chapter 10 ........................................................................................................................... 124
Chapter 11: DATA ANALYSIS ...................................................................................................................... 125
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(Part 1) ................................................................................................................................................................. 125
11.1: Summary .............................................................................................................................................. 126
11.2: Variables Related to Breakfast Cereal ...................................................................................... 126
11.2.1: Breakfast ...................................................................................................................................... 126
11.2.1.2: Timing ............................................................................................................................ 126
11.2.1.2: Cereal User Level ........................................................................................................... 127
11.2.1.3: Consumption Pattern ..................................................................................................... 128
11.2.1.4: Cereal Eating Pattern ..................................................................................................... 128
11.2.2: Ingredient .................................................................................................................................... 129
11.2.3: Cereal Preferences ................................................................................................................... 129
11.2.3.1: Cereal Preference (Location) ......................................................................................... 129
11.2.3.2: Cereal Preference (International Cereal Location) ........................................................ 130
11.2.3.3: Cereal Preference (Location Names) ............................................................................. 131
11.2.3.4: Cereal Preference (Variable) .......................................................................................... 132
11.2.4: Purchase Planning .................................................................................................................... 132
11.2.4.1: User Planning ................................................................................................................. 132
11.2.4.2: Purchase Pattern............................................................................................................ 133
11.2.5: Preferred Brand ........................................................................................................................ 134
11.2.6: Household Users ....................................................................................................................... 134
11.2.6.1: Household ...................................................................................................................... 134
11.2.6.2: Cereal Association .......................................................................................................... 134
11.2.7: Packaging ..................................................................................................................................... 135
11.2.7.1: Focus .............................................................................................................................. 135
11.2.7.2: Information .................................................................................................................... 136
11.2.8: Opinions ....................................................................................................................................... 137
11.2.9: Product Attributes ................................................................................................................... 137
11.2.10: Tasting ........................................................................................................................................ 138
11.2.11: Loyalty ........................................................................................................................................ 138
11.2.12: Reason to Switch .................................................................................................................... 139
11.2.13: Current Purchasing ............................................................................................................... 139
11.2.13.1: Monthly Price ............................................................................................................... 139
11.2.13.2: Price per box ................................................................................................................ 140
11.2.13.3: Size of box .................................................................................................................... 140
11.2.14: Rice Cereal ................................................................................................................................ 141
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11.2.14.1: Rice cereal using .......................................................................................................... 141
11.2.14.2: Rice cereal status ......................................................................................................... 142
11.2.14.3: Rice cereal reason ........................................................................................................ 142
11.2.15: Blind Testing ............................................................................................................................ 143
11.2.16: New Cereal highlight. ........................................................................................................... 144
11.2.16.1: Highlight ....................................................................................................................... 144
11.2.16.2: Feature ......................................................................................................................... 145
11.2.16.3: Flavor ........................................................................................................................... 146
11.2.16: Matco Foods. ............................................................................................................................ 147
11.2.17.1: Knowledge of Matco Foods ......................................................................................... 147
11.2.17.2: Knowledge of Falak ...................................................................................................... 148
11.2.17.3: Falak as a brand ........................................................................................................... 148
Results from Chapter 11 ........................................................................................................................... 149
Chapter 12: DATA ANALYSIS ...................................................................................................................... 150
(Part 2) ................................................................................................................................................................. 150
12.1: Summary .............................................................................................................................................. 151
12.2: SPSS Analysis ..................................................................................................................................... 151
12.2.1: Factor Analysis and Reliability Test .................................................................................. 151
12.2.2: Bartlett’s Test of Sphericity .................................................................................................. 153
12.2.3: Hypothesis Testing .................................................................................................................. 153
12.2.3.1: Continuous Variables ..................................................................................................... 153
12.2.3.2: Categorical Variables ..................................................................................................... 154
12.2.4: Correlation Testing: ................................................................................................................. 154
12.2.5: Regression Testing ................................................................................................................... 156
12.2.6: Independent Testing: .............................................................................................................. 159
12.2.7: Annova Testing .......................................................................................................................... 161
Chapter 13: BLIND TESTING ....................................................................................................................... 168
Blind Testing Procedure: .......................................................................................................................... 169
Cereal samples used: .................................................................................................................................. 169
Participants:................................................................................................................................................... 169
Findings: .......................................................................................................................................................... 170
Participant 1: Hammad ............................................................................................................. 170
Participant 2: Fariha Feroz ........................................................................................................ 171
Participant 3: Arqam ................................................................................................................. 171
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Participant 4: Maryam .............................................................................................................. 171
Participant 5: Ruhi ..................................................................................................................... 171
Participant 6: Amara ................................................................................................................. 172
Participant 7: Zeeshan .............................................................................................................. 172
Summary of Testing: .................................................................................................................................. 172
Chapter 14: FINANCIAL ANALYSIS ........................................................................................................... 174
14.1: Objective .............................................................................................................................................. 175
14.2: Formulae .............................................................................................................................................. 175
14.3: Components ........................................................................................................................................ 176
14.3.1: Cost of debt ................................................................................................................................. 176
14.3.2: Cost of Equity ............................................................................................................................. 177
14.3.3: WACC ............................................................................................................................................. 177
14.4: Recommendation ............................................................................................................................. 178
Chapter 15: DECISIONS ................................................................................................................................. 179
15.1: Decision Table.................................................................................................................................... 180
15.1.1: CORE DECISION......................................................................................................................... 180
15.1.2: CORE INFORMATION .............................................................................................................. 181
15.2: Conclusion ........................................................................................................................................... 182
Chapter 16: RECOMMENDATIONS ............................................................................................................ 183
1. Rice Cereal:........................................................................................................................... 184
2. Packaging for Children: ....................................................................................................... 184
3. Visibility: .............................................................................................................................. 184
4. Rice Pops: ............................................................................................................................. 185
5. Return Policy: ...................................................................................................................... 185
6. Price: ..................................................................................................................................... 185
7. Marketing Campaign: .......................................................................................................... 185
8. Shapes:.................................................................................................................................. 186
9. Size: ....................................................................................................................................... 186
10. Preference: ......................................................................................................................... 186
11. Availability: ........................................................................................................................ 187
12. Market: ............................................................................................................................... 187
13. Branding: ........................................................................................................................... 188
14. Sampling: ........................................................................................................................... 188
15. Variety: ............................................................................................................................... 188
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Chapter 17: ADDITIONAL REQUIREMENTS .......................................................................................... 189
Chapter 18: APPENDICES ............................................................................................................................. 192
Appendix A: Secondary Research .......................................................................................................... 193
APPENDIX B: QUESTIONNAIRE FOR LMT/IMT & GENERAL TRADE ..................................... 198
APPENDIX C: LMT/IMT & GENERAL TRADE INTERVIEWS ....................................................... 199
INTERVIEW 1 ............................................................................................................................................ 199
Destination: Shazz ......................................................................................................................... 199
INTERVIEW 2 ............................................................................................................................................ 199
Destination: Hyperstar (Lucky One Mall) ...................................................................................... 199
INTERVIEW 3 ............................................................................................................................................ 200
Destination: Diamond Super Mart ................................................................................................ 200
INTERVIEW 4 ............................................................................................................................................ 200
Destination: Anchor Mart ............................................................................................................. 200
INTERVIEW 5 ............................................................................................................................................ 201
Destination: Hyderi Super Mart .................................................................................................... 201
INTERVIEW 6 ............................................................................................................................................ 202
Destination: Ami’s Store (Khadda Market DHA) ........................................................................... 202
INTERVIEW 7 ............................................................................................................................................ 203
Destination: Ebco (The Forum, Clifton)......................................................................................... 203
INTERVIEW 8 ............................................................................................................................................ 204
Destination: Paradise Store (Schon circle, Clifton) ....................................................................... 204
INTERVIEW 9 ............................................................................................................................................ 205
Destination: Naheed Supermarket (Bahadurabad) ...................................................................... 205
INTERVIEW 10 ......................................................................................................................................... 205
Destination: Hyperstar (Clifton) .................................................................................................... 205
APPENDIX D: GT VISITS ............................................................................................................................ 206
APPENDIX E: QUESTIONNAIRE FOR DOCTORS .............................................................................. 208
APPENDIX F: DOCTORS VISITS .............................................................................................................. 209
APPENDIX G: FOCUS GROUP – MALE STUDENTS........................................................................... 210
LOCATION: IBA BOYS HOSTEL .......................................................................................................... 210
APPENDIX G-1: THEMATIC ANALYSIS – MALE STUDENTS........................................................ 226
APPENDIX H: IN-DEPTH INTERVIEW – MALE STUDENT ........................................................... 235
LOCATION: IBA Karachi ........................................................................................................................ 235
APPENDIX H-1: THEMATIC ANALYSIS – MALE STUDENT.......................................................... 241
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APPENDIX I: FOCUS GROUP – FEMALE STUDENTS ....................................................................... 242
LOCATION: IBA KARACHI CAMPUS ................................................................................................. 242
APPENDIX I-1: THEMATIC ANALYSIS – FEMALE STUDENTS.................................................... 252
APPENDIX J: IN-DEPTH INTERVIEW – FEMALE STUDENT ........................................................ 253
LOCATION: IBA Karachi ........................................................................................................................ 253
APPENDIX J-1: THEMATIC ANALYSIS – FEMALE STUDENT ...................................................... 256
APPENDIX K: FOCUS GROUP – CHILDREN ........................................................................................ 257
LOCATION: ANEES HUSSAIN .............................................................................................................. 257
APPENDIX K-1: THEMATIC ANALYSIS – CHILDREN ..................................................................... 270
APPENDIX L - FOCUS GROUP - WORKING WOMEN....................................................................... 273
LOCATION: NORTH KARACHI ............................................................................................................ 273
APPENDIX L-1: THEMATIC ANALYSIS – WORKING WOMEN .................................................... 285
APPENDIX M: FOCUS GROUP QUESTIONS......................................................................................... 289
APPENDIX N: QUESTIONAIRRE ............................................................................................................. 293
SECTION A: Customer Demographics ............................................................................................. 293
SECTION B: Breakfast and Cereals ................................................................................................... 294
Section C: Attributes and Variables .................................................................................................. 296
Section D: New Product Launch ........................................................................................................ 299
APPENDIX O: PRICE COMPARISON ...................................................................................................... 302
APPENDIX P: FINANCIAL ANALYSIS .................................................................................................... 303
Cost of Debt................................................................................................................................................ 303
Cost of Equity ............................................................................................................................................ 304
MATCO WACC ........................................................................................................................................... 305
Profit 250 gm for Rs. 275 ..................................................................................................................... 306
Profit 500 gm for Rs. 560 ..................................................................................................................... 308
Chapter 19: BIBLIOGRAPHY ........................................................................................................................ 310
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TABLE OF TABLES
Table 1: Secondary Research Variables .................................................................................................... 24
Table 2: National Brand Owner company shares of breakfast cereals ......................................... 37
Table 3: LBN Brand Shares of Breakfast Cereals: % Value 2013-2016 ........................................ 37
Table 4: Sales of Breakfast Cereals by Category: Value 2011-2016 (PKR MN) ......................... 62
Table 5: Competitor Profile Matrix ............................................................................................................. 65
Table 6 Operationalization ........................................................................................................................... 114
Table 7 Basic Information of respondents ............................................................................................. 119
Table 8 Household income ........................................................................................................................... 121
Table 9 Occupation .......................................................................................................................................... 122
Table 10 Location............................................................................................................................................. 123
Table 11 Breakfast Timing ........................................................................................................................... 126
Table 12 User Level ......................................................................................................................................... 127
Table 13 Cereal Consumption Pattern ..................................................................................................... 128
Table 14 Cereal Eating Pattern ................................................................................................................... 129
Table 15 What is your preferred ingredient? ....................................................................................... 129
Table 16 Buy breakfast cereal from? ........................................................................................................ 130
Table 17 Purchase Planning ........................................................................................................................ 133
Table 18 Purchase Pattern ........................................................................................................................... 133
Table 19 Users of cereal in your household .......................................................................................... 134
Table 20 Packaging information ................................................................................................................ 136
Table 21 Opinions ............................................................................................................................................ 137
Table 22 Product Attribute .......................................................................................................................... 137
Table 23 Taste Testing ................................................................................................................................... 138
Table 24 Reason to switch ............................................................................................................................ 139
Table 25 Monthly Price .................................................................................................................................. 139
Table 26 Price per box ................................................................................................................................... 140
Table 27 Size of Box ........................................................................................................................................ 140
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Table 28 New Product Features ................................................................................................................. 145
Table 29 Falak As a Brand ............................................................................................................................ 148
Table 30 Factor and Reliability Tests ....................................................................................................... 152
Table 31 Loyalty, Satisfaction on Intention (Regression) ................................................................ 156
Table 32 Loyalty on Intention (Regression) .......................................................................................... 157
Table 33 Attribute, Confidence on Loyalty (Regression) ................................................................. 158
Table 34 Loyalty on Gender (Independent T test) .............................................................................. 159
Table 35 Intention on Gender (Independent T test) .......................................................................... 160
Table 36 Intention, Loyalty on Age ( Annova) ...................................................................................... 161
Table 37 Intention, Loyalty on Income ( Annova)............................................................................... 163
Table 38 Intention, Loyalty on Occupation (Annova) ........................................................................ 166
Table 39 Core Decisions and Information .............................................................................................. 180
Table 40 Market Size ...................................................................................................................................... 190
Table 41: Sales by volume ............................................................................................................................ 193
Table 42: Sales by Value ................................................................................................................................ 193
Table 43: Sales by Volume Growth % ...................................................................................................... 194
Table 44: Sales by Value Growth % .......................................................................................................... 194
Table 45: NBO Company Shares ................................................................................................................. 194
Table 46: LBN Brand Shares ........................................................................................................................ 194
Table 47: Distribution of breakfast cereals............................................................................................ 195
Table 48: Forecast sales by volume .......................................................................................................... 195
Table 49: Forecast sales of breakfast ....................................................................................................... 196
Table 50: Forecast sales - % volume growth......................................................................................... 197
Table 51: Forecast sales - % value growth ............................................................................................. 197
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TABLE OF FIGURES
Figure 1: SWOT Analysis ................................................................................................................................. 46
Figure 2: IBL Plants ........................................................................................................................................... 78
Figure 3: LMT Share .......................................................................................................................................... 79
Figure 4: Retail Coverage ................................................................................................................................ 81
Figure 5:Fauji Warehouses ............................................................................................................................ 89
Figure 6 Variables from In-depth Interview (Female Student) ..................................................... 106
Figure 7 Variables from In-depth Interview (Male Student) .......................................................... 108
Figure 8 Research Model ............................................................................................................................... 111
Figure 9 Questionnaire Structure .............................................................................................................. 117
Figure 10 Basic Information of respondents......................................................................................... 120
Figure 11 Cereal Users ................................................................................................................................... 120
Figure 12 Age Group ....................................................................................................................................... 120
Figure 13 Household income....................................................................................................................... 121
Figure 14 Occupation ..................................................................................................................................... 122
Figure 15 Location ........................................................................................................................................... 123
Figure 16 Breakfast Timing ......................................................................................................................... 127
Figure 17 User Level ....................................................................................................................................... 127
Figure 18 Cereal Consumption Pattern ................................................................................................... 128
Figure 19 Cereal Preference ........................................................................................................................ 130
Figure 20 Store Names ................................................................................................................................... 131
Figure 21 Important cereal attribute ....................................................................................................... 132
Figure 22 Brand Preferred ........................................................................................................................... 134
Figure 23 Breakfast cereal associated with ........................................................................................... 135
Figure 24 Cereal Packaging .......................................................................................................................... 136
Figure 25 Loyalty ............................................................................................................................................. 138
Figure 26 Ever used rice cereal .................................................................................................................. 141
Figure 27 Rice Cereal Status ........................................................................................................................ 142
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Figure 28 Rice Cereal Reason ...................................................................................................................... 142
Figure 29 Blind Testing ................................................................................................................................. 143
Figure 30 New Product Highlight .............................................................................................................. 144
Figure 31 Flavor ............................................................................................................................................... 146
Figure 32 Matco Food Knowledge ............................................................................................................. 147
Figure 33 Knowledge of Falak..................................................................................................................... 148
Figure 34 Final Model..................................................................................................................................... 152
Figure 35 Sales of Breakfast Cereals......................................................................................................... 190
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Chapter 1: PROJECT BRIEF
1.1: Summary
The main objective of this project is to understand the breakfast cereal industry of Pakistan.
We need to conduct a detailed market research which includes study about consumption
patterns, consumer preferences for buying cereals, competition in the market and the factors
which Matco needs to keep under consideration while pursuing this market.
This chapter outlines the scope, objectives and deliverables of this project.
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1.2: Project Scope
The scope of this project is to understand market dynamics of cereal industry. We also need
to look at the factors that affect consumer perception and buying behavior related to
purchase of cereal. A complete feasibility study will include the target market, competitive
analysis, location strategy, name strategy, price strategy, product strategy and place strategy.
It’s important to analyze the organizational resources and match it with the findings of our
research to check the viability of this study whether its applicable or not and how much
benefit it will provide to Matco. This is done during the recommendation phase of research.
This report explores and identifies the core variables related to cereals. On the base of our
finding, a plan will be generated in the end to outline the proposed activities we find deem
for Matco’s decision of cereal plant.
1.3: Management Objectives
1.2.1 Target Market

- Analyzing the current and potential segment of Breakfast Cereal
1.2.2 Competition
- Analysis of Competition in Pakistani Market
1.2.3 Location Strategy

- Conduct a financial feasibility study of Karachi
1.2.4 Name Strategy

- With what name, this new cereal should be introduced in market
1.2.5 Price Strategy

- Optimum price of cereal in comparison to the products of competitors
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1.2.6 Product Strategy
- What should be the core ingredient of cereal?
1.2.7 Place Strategy

- Where and how cereal should be sold with respect to local markets only
1.2.8 Organization Capacity

- Analyze resources and internal systems at Matco (Management / Marketing /
Branding etc.)
1.4: Research Objectives

- To conduct a detailed market research about the Cereal consumption market in
Pakistan which includes study about product attributes, consumer perception and
buying pattern for buying cereals.
- To identify the market leader and strategies used by the competitors in terms of
product features, plant location and distribution network.
- To analyze the location in terms of financial aspect i.e. NPV, IRR, Payback Period etc.
- To identify which name will attract the consumers in terms of purchase selection.
Should the name of the product be Matco, Falak or a new name? Also look for the
possibilities of brand extension or line extension.
- To determine the optimum selling price after considering the manufacturing cost.
- To identify the right size of SKU of cereal
- To decide whether rice-based cereals should be launched or corn-based cereals.
- To determine the feasible option for branding whether they should go for in-store
branding or not (Private Labels or White labels).
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1.5: Project Deliverables
A detailed marketing plan including:
➢ Product Features and Attributes – Price, Name, SKU Size and Location
➢ Target customers’ segment for promotion activities
➢ Feasibility of setting up plant in Karachi (P&L, Balance Sheet, Projections, IRR,

Payback period, NPV)
➢ Final verdict: Whether cereal production by Matco is a right decision or not
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Chapter 2: RESEARCH METHODOLOGY
2.1: Summary
Research methodology is divided into two core phases, secondary and primary research.
Secondary research was the phase one, where the analysis is done on the researches already
done related to product attributes, consumers perceptions and patterns along with detailed
market analysis. Detailed analysis was resulted from the literature review where the
framework of variables leads to the research toward the consumer perception and intention
for cereals purchase. Primary research was done on the foundations build by the initial
secondary research of reports. Here factors like product attributes and market dynamics
were highlighted with the help of in-depth interviews, market survey, and focus groups.
This chapter outlines the methodology which helped us achieve the management
objectives by identifying the variables related to cereal industry from organization
perspective as well as from consumers perspective.
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2.2: Research Methodology
Extensive research of the project is divided into:
1. Secondary Research
2. Primary Research
2.2.1: Secondary Research
Secondary Research includes the market data, researches, analysis and reports already done
on consumer intentions and perceptions for cereal purchases. This was based on knowledge
and information provided by the client and resulted from the management objectives. Here
various factors were identified and further analyzed under the literature review.
➢ Reports and data related to understanding the dynamics of consumers when it came
to Cereal purchase
➢ Reports related to market and competition of breakfast cereals
➢ Reports related to Pakistan and Karachi in terms of sales of cereals
➢ Literature review of performance indicators, strategies, unique attributes
Secondary research lead to literature review where the following factors were kept under
consideration
Table 1: Secondary Research Variables
A. Health consciousness B. Medical Impact of cereals

D. Consumption among adults and
C. Gender Dimension in consumption
children
E. Attributes of cereals: Texture, taste F. Impact of advertisements
G. Advertisements & packaging H. Latest market trends
I. Usage pattern: Time, supplements J. Brand loyalty
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like hot or cold milk
L. Decision making and influencer role
K. purchase pattern
like pestering power of children.
2.2.2: Primary Research
Primary research is divided into:
1. Market Survey and Interviews (LMT,

IMT, Retailers)
2. Focus Groups
3. In-depth Interviews
4. Consumer Surveys
2.2.2.1: Market Survey and Interviews (LMT, IMT, Retailers)
Interviews were segregated according to the stores. Local Modern Trade, International
Modern Trade and General Trade were included in our sample. The objective of Interviewing
three different categories of stores was to encompass the buying pattern of diverse shoppers.
Detailed interviews were to held with the manager of stores to enlighten us with the buying
pattern.
2.2.2.2: Focus Groups
Focus groups were done to identify the attributes and themes related to consumer intentions
and perceptions which results in their purchase patterns. These were ferreted out by a long
and healthy conversation with a group of target consumers identified during the secondary
research and interviews from market. These focus groups were targeted toward employed
women, house wives, children, and students (Male and females).
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Further analysis was done on the basis of the identified variables from focus groups and used
in the in-depth interviews
2.2.2.3: In-depth interviews
In-depth interviews included the three core elements identified through secondary research
and influenced through focus groups i.e. Product Attributes, Consumer Perception and
Buying Behavior. In-depth interviews were conducted with the identified target market
segment same as focus groups to reinforce the attributes to solidify the base of consumer
surveys.
2.2.2.4: Consumer Surveys
Variables identified and reinforced during the whole research lead to a model which resulted
in the making of questionnaire. This questionnaire is to be distributed among 300
participants to measure the variables to see which variables is directly and which is
indirectly affecting the research and will lead to a plan for cereal plant.
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Chapter 3: LITERATURE REVIEW
3.1: Summary
Ready to eat breakfast cereals usage is increasing around the globe. Breakfast is considered
a key for healthy living by health-conscious individuals but people are finding still more
convenient ways to breakfast on the move. Hence snack bars have gained popularity since
they are more convenient to consume than breakfast cereals. Furthermore, consumers are
conscious of sugar content of cereals so companies are striving to reduce it. Weight reduction
and reduce of heart risks are some of the positive impacts consumers perceive. Children are
one of the major consumers of breakfast cereals and advertisements have an impact on them.
They have pestering power of parents. Our literature review exercise has revealed several
keys points prompts us to investigate below factors in context of Pakistan: Consumer
perception, Flavor liked, types of cereals, approach from producers, attributes related to
products, purchase intentions.
This chapter outlines the history, types, consumer perception, approaches used by
producers, and product attributes
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Breakfast is one of the most important and highly undervalued meal of the day. Eating a
healthy breakfast is extremely important as it provides the body with the required energy to
start off your day. The meal is particularly important for children, as it is an important source
of nutrition during the growth phases (Nicklas, 2004). Avoiding breakfast or an improper
consumption of breakfasts has been noted to have a negative impact on the children’s school
performance, and the dietary deficiencies which they suffer are seldom replenished by the
other meals. The focus on health led to the introduction of breakfast cereals in 1800, which
has since grown by leaps and bounds and has now become one of the biggest industries of
the world.
3.2 History of Breakfast cereals

While breakfast is considered a very special meal in the modern era, however history tells
us something entirely different. Various cultures over the world did not considered breakfast
to be a beneficial meal, in fact food historian Caroline Yeldham revealed that early Romans
even believed that it was healthier to eat only one meal in a day. In her book, Three Squares:
The Invention of American Meal, Abigial Carrol writes that Native Americans did not used to
consume food by having proper meals, but instead ate small amounts of food throughout the
day, while for some days to use to fast. Similarly, in medieval Europe, breakfast was not
considered a proper meal, but rather was only eaten by rich as a luxury, and by poor to
provide them with the necessary energy to perform their labors.
It was with the migration of people from rural to urban cities when the breakfast became a
regular meal, as the people now had to work more and following a specific schedule became
a necessity. With the Industrial Revolution, breakfasts became a norm for people as they
were required to work all day and hence needed extra nourishment. But even then, it was
not like today’s breakfasts. Americans ate breakfasts like they would consume their dinner,
i.e. they ate meat and potatoes and hence their breakfasts would consist of roasted chickens,
flapjacks, corned bread, butter and beefsteaks. (Dyson, 2000).
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For decades, the traditional breakfast food for the masses was oat-based porridge (a
breakfast cereal). The wealthy ate meat-based breakfasts and as people grew wealthy,
porridges and other cereals were replaced by an upwardly mobile aspirational meat and egg-
based breakfasts. The old cooked cereals were looked upon as plebeian.
In the late 1800s, health movements blossomed in the US. And, these reformers encouraged
health conscious Americans to cut back on meat consumption at breakfast.
The biggest change to the morning diet can be directly traced to one of the world’s greatest
brands — Kellogg’s. And, its Seventh Day Adventists beginnings.
Eating such dishes led to health problems in American, most commonly of indigestion.
People wanted a meal which was light, simple to cook and easy to consume. Seeing the
concern of people for health, many dieticians and health reformers introduced several
products, including Graham Crackers by Sylvester Graham. However, it was John Harvey
Kellogg who is credited with bringing a major change in people’s breakfast habits with the
introduction of cornflakes in 1890.1 The cereals proved to be very popular among people,
and today Kellogg’s is one of the most popular brand in the world.
3.3: Today Time - The last 25 Years

In U.S there is a turn from carbohydrates back to protein consumption. The industry is at a
crossroads. The advent of Greek yogurt and protein bars are an indication of a changing
trends.
It is important to note that diet cereal brands like Special K are moving towards breakfast
bars. Similarly, Quaker markets breakfast bars, rolled oats and steel-cut oats that require 30
minutes to cook.2
1https://web.archive.org/web/20090419211647/http://www.mmc.gov.uk/rep_pub/reports/1970_1975/fulltext/067c01.pdf
2
https://www.stealingshare.com/pages/breakfast-cereal/
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3.4: Types of Cereals
Breakfast cereal is a processed food produced from grains. It is often consumed with milk.
Some popular types of cereals contain grains like corn, wheat, oats, rice, and barley. Other
ingredients include salt, yeast, sweeteners, flavoring agents, vitamins, minerals,
preservatives, and others. Malt, white sugar, brown sugar, and corn syrup are the artificial
sweeteners used in breakfast cereals. In addition to that, breakfast cereals are added with a
variety of seasonings such as chocolate powder; cinnamon; honey; fruit flavors; and others.3
3.5: Consumer Perception

Health effects: Are benefits of Breakfast cereals over-exaggerated?
To answer this question let us first understand how cereals made:
3.5.1: Procedure to make Breakfast Cereals

It is important to understand how breakfast cereals are typically made:
a. Processing: The grains are usually processed into fine flour and cooked after
removing the bran.
b. Mixing: The flour is then mixed with ingredients like sugar, chocolate and water.
c. Extrusion: Many breakfast cereals are produced via extrusion. This is a high-
temperature process that uses a machine to shape the cereal.
d. Drying: Next, the cereal is dried.
e. Shaping: Finally, the cereal is shaped into forms, such as balls, stars, loops or
rectangles.
Breakfast cereals may also be puffed, flaked or shredded. The cereal may also be coated in
chocolate or frosting before it is dried.
3
https://www.researchandmarkets.com/reports/4395312/global-breakfast-cereals-market-2017-2021#pos-2
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3.5.2: Sugar Content
From the process noted above it is clear that components like sugar are mixed with grains to
formulate the end product that consumers consume. Hence it is not completely natural and
full of vitamins as is often portrayed in advertisements and perceived by the consumers.
Consumer rights advocates are increasingly raising awareness about presence of sugar.
According to them, ideally consumers should choose a breakfast cereal that contains less
than 5 grams of sugar per serving. Read the food label to find out how much sugar the
product contains.
3.5.3: Presence of Genetically Modified Organisms (GMOs)

Genetically modified organisms (GMOs) can be defined as organisms (i.e. plants, animals or
microorganisms) in which the genetic material (DNA) has been altered in a way that does
not occur naturally by mating and/or natural recombination. The technology is often called
“genetic engineering”. It allows selected individual genes to be transferred from one
organism into another, also between nonrelated species. Foods produced from or using GM
organisms are often referred to as GM foods.4
The recent French study has linked Monsanto’s GMO corn to cancer, liver damage, organ
failure, kidney damage and premature death. 5 It is big area of concern for health
organizations governments all over the world are now warning their people to make
healthier and better food choices by avoiding GMO food.
Many Breakfast cereals are claimed to be manufactured from Monsanto’s GMO seeds.
Consumers rights activist are fighting big players like Kellogg’s to label their Cereals GMO
content and respect consumers choice in doing so. Perceived presence of GMOs in breakfast
Cereals is one of the biggest contributors in declining sales observed in U.S.
4 Food Safety, WHO: http://www.who.int/foodsafety/areas_work/food-technology/faq-genetically-modified-food/en/

5
See: http://www.seattleorganicrestaurants.com/vegan-whole-foods/images/Final-Paper.pdf
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Although there is an increasing world trend in skipping breakfast meals but there is also a
growing trend of healthy eating. People are conscious of what they eat. There is also a shift
from conventional breakfast eating at the table to on the go.
3.6: Approach by producers - Categorization
3.6.1: Breakfast cereals Packaging
3.6.1.2 Adults
Packaging is one of the vital factors contributing to the purchase of cereals by customers. In
a study conducted on 50 customers with 10 breakfast cereals, it was found that 66% of the
people looked at all the 10 brands, before selecting a particular brand. Around 72 to 98%
people considered brand name to be important, while nearly everyone looked at the product
name. Front packaging also was found to be of high importance as around 80-90% customers
focused on front pack images. (Paula Varela Lucía Antúnez Rafael Silva Cadena Ana Giménez
Gastón Ares 2014)
3.6.1.2 Children
McNeal (1969) points out:
They (children) may observe, request and select goods with permission while accompanying
their parents shopping as well as make independent forays to shops themselves.
Breakfast Cereal manufacturers face a problem that people of purchase the cereal are not
necessarily the end consumers. It may be the children. The packaging therefore has to appeal
to both adults and children. Individual product identity has to merge with elements of
corporate branding to generate a marketing mix that provides assurance of quality and
nutrition.
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Distinctive packaging is essential part of this marketing mix. According to Gelprowic and
Beharrel (1994) pester power can derive from an attraction to packaging6
Children centric marketing of foods products is nothing new but recently many more
manufacturers have started utilize it more and more. The influence of children on parental
purchase cannot be overemphasized. Bennet (1991) reported that children have greatest
influence on parents purchasing behavior from age of five until about 11 or 127
It is important to remember that marketing communications should be targeted in such a

way that they don’t appear to be like preaching. Young consumers know what a product
could do for them in terms of making them look and feel better or being better accepted
within peer group.
Children market segment is becoming sophisticated and skeptical towards advertisements.

It is also an important thing to keep abreast with changing trend in taste preferences, a key
feature of children market and then incorporate those changes in the product in quick time.
Some of the important behavioral characteristics to be kept in mind are:
➢ Never have a condescending approach
➢ Adopt a straight forward and sincere approach
➢ Acknowledge youngsters for being motivated by rational values
➢ Be personal as much as possible
Cartoon characters in children advertisements are moving beyond on-pack promotions

and actually into the pack itself. Manufacturers are inclining towards innovative ways to
break the clutter and stand out from the competitors. For this to happen, comprehending
children behavioral characteristics in relation to communication and packaging is absolutely
essential.
Gelprowic and Beharrel (1994) conducted study on packaging which said that attractive
packaging drives the pester power of children. In the research, mothers tried to show their
6
See: https://doi.org/10.1108/00070700210443129
7
See: https://doi.org/10.1108/00070700210443129
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authority by resisting packaging appeal but in actuality had to yield. In Pakistan’s setting it
would be interesting to see who the influencer is and who is the final decision maker
Meyers (1998) in his research says that distinguishing feature of packaging of children
products is: The packaging not serves as the selling tool for the product by means of
distinguished structure and colorful graphics designed to attract and excite both buyer
(parents) and receiver (children) but also as repository and occasionally as an integral
component of the product.
3.6.2: Brand Awareness

Helene Hill and Jennifer Tilley (2002) study found children having mixed brand awareness.
Children were more aware of the major manufacturer and recognized it as a brand. Authors
attributed this to the fact that children were more exposed to the major brand and had
“opportunities to see” more than competitor brands. Brand logo needed to be same across
all ranges so that children identify it through their own cereal or those of other family
members.
3.6.3: Character Merchandizing

Children suggested to have cartoon characters, animals and celebrities on front of the cereal
pack. This needs to be checked as it abnegates the earlier held view that children grow out
of cartoony images around the age of 7. Also, several researches claimed that there is
confusion in children in recognizing cartoon characters. Helene Hill and Jennifer Tilley
(2002) research negates this proposition as children clearly identified the characters.
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3.7: Usage Level
3.7.1: Cereals as Functional Food

An interesting thing to note is that people also consume cereals during other times of the
day, while some people even consume them as lunch during the weekends. This means that
breakfast cereals can be labelled as Functional Foods i.e. the food which is prepared to
provide specific nutritional content to fulfill an explicit purpose. Other foods products falling
in this category include energy bars, probiotic yogurt, energy bars etc. (Kathryn Webster,
1995).
Currently cereal companies are striving to produce cereals that are fortified with assortment
of vitamins leading to improved nutrition.8
3.7.2: Prevention of Heart Failure

The consumption of breakfast cereals has been noted to have decreased the risk of heart
failure. It should be noted that the lowered risk was only found in people who were eating
whole grain cereals and not refined breakfast cereals. (Luc Djousse, 2007). The prevention
against heart effects by whole grain cereals is noted to have been through various biological
mechanisms. Potassium which is found to be present in whole grain cereals has been linked
to lower blood pressure. Lipid levels and insulin sensitivity were noticed to have been
improved through Phytoestrogens found in whole grain cereals. Whole grain cereals can also
help in controlling body weight by slowing the digestion of starch. Out of a sample size of
74,901 female nurses and male physicians, it was found that greater consumption of whole
grain cereals and dietary fiber has an inverse relation with weight increase. Interestingly,
the study revealed that consumption of refined grain was found to have a positive relation
with weight gain in women, but men remained unaffected.
8 See: https://doi.org/10.1108/00070700210443129
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3.8: Product Attributes
3.8.1: Flavor
Among children chocolate was the most liked flavor according to research of Helene Hill and
Jennifer Tilley (2002) whether it was part of cereal itself or as chocolate milk: “cut up
brownies and cover them in chocolate”, break up a crunchie bar and then pour chocolate
over them”, chocolate with chocolate milkshake over them”.
3.9: Purchase intentions: Advertisements

Helene Hill and Jennifer Tilley (2002) research concluded that children were aware of the
latest advertisement campaigns. They were also influenced from different sources like point
of purchase merchandizing and peers. Major manufacturers claim that advertisement play
an important role in influencing children to make purchase requests. Even when children do
not understand the advertisement but in context of generating pester power remembering
a character and understanding them is not necessarily an issue.
Advertisement entailing free gifts were understood by all children but advertisements as a
means of product awareness appeared confusing to many children.
3.10: Market Share

According to data collected from Food and Agricultural Organization of the United Nations
2014, Kellogg’s hold the highest market share in cereal industry at 40.8 %. Cereal partners
Worldwide, a joint venture between General Mills and Nestle, holds the second position at
26%, while Pepsi Co. holds a significantly smaller portion at 4.6 %. Other remaining
organizations hold 28.7% of global market share.
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3.10.1: Share in Pakistani Market
Table 2: National Brand Owner company shares of breakfast cereals
% retail value rsp company 2012 2013 2014 2015 2016

Fauji Cereals Ltd 69.2 69.5 70.5 66.7 59.7
Kellog Co 6.7 6.7 6.6 6.8 14.2
Nestle Pakistan Ltd 8.1 8.1 8.1 7.4 9.4
PepsiCo Inc 5 5 5.1 5.3 5.3
Others 11 10.7 9.7 13.8 11.4
Total 100 100 100 100 100
Source (Euro Monitor)
Table 3: LBN Brand Shares of Breakfast Cereals: % Value 2013-2016
% retail value rsp

% retail value rsp brand (GBO) company 2013 2014 2015 2016
Fauji Cereals Fauji Cereals Ltd 69.5 70.5 66.7 59.7
kellog's Cereals Kellog Co 6.7 6.6 6.8 14.2
Nestle Cereals (Cereal Parters
Worldwide SA Nestle Pakistan Ltd 8.1 8.1 7.4 9.4
Quaker Oatmeal PepsiCo Inc 3.7 3.8 3.9 3.9
Quaker Whiteoats PepsiCo Inc 1.3 1.3 1.4 1.4
Others Others 10.7 9.7 13.8 11.4
Total Total 100 100 100 100
Source (Euro Monitor)
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Results from Chapter 3
Name Brand Name Known to Consumers
Target Market Young Adults (Health Conscious) and Children
Flavor Nutrition Oriented / Chocolate
Place LMT and IMT
Ingredient Whole Grain and Vitamins Oriented (Rice, Wheat, Corn)
Should Go? Yes
Key points: Focus on toys for children, focus on packaging for young adults
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Chapter 4: COMPANY ANALYSIS
This chapter outlines the history of Matco foods and details of their operations with a
detailed swot analysis.
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4.1: Matco Foods
Matco Foods is a leading agribusiness in South Asia, with over 50 years of experience9 in the
rice industry and a global portfolio of more than 150 corporate customers. It is the largest
basmati rice exporter from Pakistan. Its products reach over 60 countries worldwide. It is
the only agro processing company in Pakistan in which the International Finance
Corporation (IFC) (World Bank Group) has invested equity. As the largest basmati rice
exporter, Matco’s flagship brand Falak Basmati Rice10 is available in more than 40 countries
worldwide. With private label brands11 being exported to over 60 countries worldwide.
Matco strives to be the most technologically advanced rice processing business in Pakistan
and therefore continuously seeks improvements throughout their product supply chain and
processing methods.12 Today Matco Foods operates 5 rice processing and milling plants,
which include vertically-integrated paddy drying, storage, husking, processing and
packaging facilities in Sadhoke, Punjab and Karachi, Sindh.
The 50 years of experience Matco Foods has provided the company with abundant expertise,
which is applied to wide range of commodities which include rice, rice bran, rice and wheat flours
and sugar. With over 50 years of experience within the rice industry, Matco Foods guarantees
traceable, sustainable premium quality rice that adhere to international standards. Matco Foods
also holds international organic accreditation from the Control Union for USDA Organic and EU
Organic certification. By fall 2017, Matco Foods will commence production of organic rice
glucose and organic rice protein products which will be tailored to individual customer
specifications. Matco Foods is also the sole distributor of Signature Snacks for Pakistan. Signature
Snacks is a leading manufacturer based in Dubai, which produces premium quality biscuits,
wafer, crackers and baked chips. The facility is built upon 200 000 square feet with top class
manufacturing and packaging machines that guarantees quality, safety and modern methods of
production
9 http://matcofoods.com/page-history
10 http://matcofoods.com/page-flagship-brand
11 http://matcofoods.com/page-private-labeling
12
http://matcofoods.com/page-infrastructure
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4.2: Products Portfolio
Their products include
a. Falak – Flagship brand
b. Basmati Rice
c. Organic rice
d. Non-Basmati rice
e. Rice glucose
f. Rice Protein
g. Other products - Himalayan Pink Salt, Iodized salt, Vermicelli, White Rice
Flour, Rice Bran Oil, Masala & Spices
4.3: SWOT Analysis

4.3.1: Strengths
- 4.3.1.1: Already in Rice business - Matco has an advantage that it is

already dealing in rice business. Hence the company will not need to put
efforts in sourcing as it already has a base. It will have a stable supply base of
raw materials and strong backward linkage, which will eliminate the factor of
late delivery of raw materials.
- 4.3.1.2: Strong distribution network - Matco has a very large client

base, due to which it has a very well-developed distribution network, as it
needs to deliver it’s all over Pakistan to its clients. Hence the company can use
its already established network to distribute the cereals.
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- 4.3.1.3: Global presence - Matco has an international presence,
operating in more than 60 counties all over the world. The country has over
150 clients and has a network of distributors including Metro, Sun Rice, Unidex
etc. The company can use its extensive network to export its products to
foreign markets.
- 4.3.1.4: Strong brand name - Falak basmati rice - Matco has a

strong and reputable brand by the name of Falak Basmati rice. The product is
of extremely high quality and has a very positive perception in the market.
Matco can leverage the Falak brand name to launch its new cereals in the
market.
- 4.3.1.5: Plant in Karachi (lower transportation cost) - Matco

plans to establish its plant in Karachi, making it the only company to have its
production facility in Karachi. This will provide it a significant advantage as it
result in its transportation and logistics cost savings.
4.3.2: Weaknesses
- 4.3.2.1: No prior experience in breakfast cereal industry - Matco

will be entering a completely new territory and has no prior experience,
whereas its competitors have years and decades of experience, which will put
Matco at a huge disadvantage.
- 4.3.2.2: Weak Marketing - Matco is not known for its marketing efforts.
The company has mostly relied on its established brand name to sell its
products. However, with cereals, the company will not have this advantage,
since it will have to build up its brand from scratch, which would require
significant marketing expenses
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4.3.3: Opportunities
- 4.3.3.1: Huge Growth Potential - The breakfast cereal industry is expected to

have a huge growth potential in the market. Due to rising disposable income of income,
more and more people will be considering switching to breakfast cereals, especially from
middle class segment due to its convenience and ease of use.
- 4.3.3.2: Increasing health consciousness - People are now becoming more

health conscious, and are looking for healthy and nutritional alternatives. This provides
Matco and other cereal manufacturers a perfect opportunity to target these segments by
manufacturing products which can serve as a meal as well as provide health benefits.
- 4.3.3.3: Rural Areas - Breakfast cereals do not have a great penetration in the rural
region. In areas like Gujranwala etc. only Fauji cereals have been able to penetrate the
market to some extent, hence Matco has a huge opportunity to expand its business into
that untapped market.
- 4.3.3.4: General Trade - Matco should focus on General Trade channels to sell its
products, as most of the sales of breakfast cereals have resulted from small retail shops
and stores. This is because a majority of our population still purchases products these
channels.
- 4.3.3.5: Patients - Matco can focus in introducing its products to doctors, as they have
a huge role in determining the diet of their patients. So far, doctors have not been
approached by the other companies to recommend their product to patients, making it a
huge untapped market for the company.
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- 4.3.3.6: Offer more variants - Matco can also take over the competition by offering
a wide variety of variants. So far, only Kellogg’s has a substantia variety of variant
offerings, hence if Matco choses to follow the same strategy, it will gain a distinct
advantage over competitors.
- 4.3.3.7: Untapped Rice market - Rice based cereals are currently non-existent in
the market. While Kellogg’s and Fauji both offer rice-based cereals, however it is only one
variant. Since Matco already deals in rice business, hence if chose to enter into the rice-
based cereals market, they won’t be facing any real competition and can grab a significant
market share.
- 4.3.3.8: Population - Around 52% of our population is aged under 24, which is the
primary target market for cereals market. Hence demographically, the company has an
ideal opportunity to enter the breakfast cereal industry as it will have a lot of potential
customers.
4.3.4: Threats
- 4.3.4.1: High competition (both domestic and International) -

Matco will be facing extremely tough competition from rival brands. Breakfast
cereal industry is dominated by both International and domestic brands,
where Fauji cereals has the biggest market share. However, now International
brands are also catching up, especially in the last couple of years, where both
Kellogg and Nestle have seen significant growth in their market share.
- 4.3.4.2: Promotional Offerings from competitors - One of the

major challenges which Matco will have to face from its industry rivals is of
competing with their promotional offerings. International brands are already
grabbing market share from local players due to their attractive price offerings
which are gaining people’s attention, especially from mid to high income
customers.
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- 4.3.4.3: Competitor dominance in trade channels - Kellogg is the
dominant player in the LMT/IMT channels, having a 72% share. This will
prove to be significant barrier to entry for Matco if it wants to sell its products
through this channel. Similarly, Fauji has 72% share in the GT channel. Hence
Matco has significant barriers to entry if it wants to enter the breakfast cereal
market.
- 4.3.4.5: Dominant market is corn and wheat - While producing rice-

based cereals seems to be the most obvious option, since it will have huge
synergies to companies existing business, however it will be very risky as corn
and wheat-based cereals dominate the market, and Matco will have a hard
time creating place for its rice cereals.
- 4.3.4.6: Fuel price increase - Volatility in fuel price adds another

restriction to company, since it will have a direct impact in increasing
company’s transportation costs. Recently, the fuel price has gone up by 4 Rs.
and there is no telling that it will continue to rise in the future too.
- 4.3.4.7: Adverse currency exchange rate fluctuation - Since Matco

already has significant business in exporting rice, hence if plans to export its
cereals, it will have to be mindful of the currency fluctuations. Over the last
year, the rupee has depreciated by 10%, and may continue to do so in future
too.
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Figure 1: SWOT Analysis
•No prior expertise in

•Already in Rice the cereal industry
business •Weak marketing
•Strong distribution efforts
network
•Global distribution
network
•Strong brand name -
Falak basmati rice
•Plant in Karachi (lower
transportation cost)
Strengths Weaknesses
Opportunities Threats
•Huge growth
potential in breakfast
cereal market •Trade offers from
•Untapped Rural Areas competitors will eat
•Focus on health up market share
concious customers •Promotional Offerings
•General Trade from competitors
•Offer More Variants •Competitor
•Patients dominance in trade
channels
•Untapped Rice
cereals market •Dominant market is
wheat and corn
•Population
•Fuel Price
•Currency Fluctuation
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Chapter 5: SECONDARY RESEARCH
5.1: Summary
Breakfast cereals are considered high quality healthy option for breakfast and are placed at an
advantageous position to benefit from the growing health consciousness, rising income levels and
rise in number of women entering the labor force. Busy lifestyles will further boost demand for
quick and easy breakfast options and there is no better alternative than the Cereals.
This chapter outlines the global trends and trends in contexts of Pakistan in terms of
breakfast cereal.
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5.2.: Global Trends
“Man is what he eats”- Greek Philosopher, Ludwig Feuerbach
Importance of balanced diet cannot be overemphasized. Nutrition plays an important role

in our physical being. We require vitamins and minerals for healthy skin, teeth, etc. And not
getting them in adequate amounts may result in deficiencies and diseases. Carbohydrates
and fats are required to provide energy to our bodies without which we would not be able
perform our daily activities. Proteins are also an important part of our diets since they help
in the building and repair of cells and tissues of our bodies. The challenge for the consumers
is to maintain good diet with fast pace of life
Accenture consulting’s market research data indicates consumer healthcare in 2013 was a
$502 billion market that it projected to grow by almost 50 percent to $737 billion over the
next five years. Accenture considers preventive health and wellness categories such as
vitamins, nutrition, weight management and fortified foods and beverages as major drivers
of this growth. Accenture attributed growing wealth of emerging market consumers as one
of the major reasons for the growth in global health market (Accenture, 2013).13
In its global report, “We are what we eat” published in 2015 Nielsen says that nearly 49% of
the respondents who participated in its Global Health and wellness survey considered
themselves overweight. Obesity acceleration was a global phenomenon, no longer limited to
developed countries. About 62% of the world's 671 million obese individuals live in
developing markets, according to the 2013 Global Burden of Disease Study. Nielsen's study
shows that consumers are attempting to take charge of their health—50% are actively trying
to lose weight and 88% are willing to pay more for foods with healthy attributes to some
degree. This spells good signal to the firms aiming to develop health centric customer
products like cereals
13Accenture Health Report: https://www.accenture.com/us-en/~/media/Accenture/Conversion-

Assets/DotCom/Documents/Global/PDF/Industries_2/Accenture-Changing-Future-of-Consumer-Health-High-Performance-Business-Study-
2013-Update.pdf
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Breakfast still remains the most important meal of the day for most of the People globally
despite changing lifestyles and fast pace of life.14 Breakfast is in a simultaneous state of
evolution and changes as the consumer base. The desire for flavor customization and
convenience is stronger than before with functional ingredients and non-traditional
products gaining rapid ground. Five trends in consumer preferences and consequent
Breakfast evolution are discussed below:
5.2.1: Fast and Functional
With hectic schedule and limited time period, Convenience and Speed have come to play a
dominant role in consumers’ lifestyle. 68% of the people in a survey by FONA international
responded that they preferred to eat something for breakfast before leaving for work. They
further said that whatever they took for breakfast needed to have functional ingredients or
having perceived healthy ingredients like ancient grains. Mintel data shows that 38% of
cereal consumers say high protein is an important nutritional factor in cereal, while 52% say
the same about high fiber. As a result, companies are starting to provide more functional
ingredients across the spectrum of breakfast foods—all while keeping portability in mind
5.2.2: Hot Cereals are gaining ground
Cold cereal category is now being challenged by Hot cereal category. Rise in sales off hot
cereals is due to the consumer perception that hot cereal is more nutritious and filling than
other options. Hot cereal sales have seen a steady increase since 2010 and Mintel forecasts
the growth will continue through 2020.
5.2.3: Breakfast Anytime
Consumers don’t perceive breakfast to be just for the morning hours anymore. There is now
an increasing trend of eating frozen breakfast foods and cereal as a snack or as later meal.
14
FONA international Report: https://www.fona.com/resource-center/blog/five-trends-breakfast
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About 87% of cereal consumers surveyed by Mintel group said that cereal can be consumed
at any time of the day, and about 75% said it makes a great snack. Techonomic group also
reported a similar trend. 48 % of consumers it surveyed said that they enjoy breakfast foods
at nontraditional times.
5.2.4: Age of Customization
Increasingly, consumers are getting more and more inclined towards having a personalized
experience at Breakfast. About 29% of cold-cereal eaters want to be able to add ingredients
like nuts, fruit and flavor packets to their cereal, and 31% of hot cereal eaters said the same.
Consumers are demanding cereals not only to suits their personal taste, but also their
personal experience. Brands from childhood still remained favorite for the younger cereal
consumers. About 68% of Millennials said the brands they loved as kids are still their
favorite, suggesting a possible interest in classic cereals and similar sentiments were
expressed by 54% of Generation Xers, 44% Baby Boomers and 37% Swing Generation
members.15
5.3: Trends in Context of Pakistan

Consumers’ trends in Pakistan are slowly catching up with the global consumer trends.
Manufacturing companies stand to gain by aligning their strategies to these trends. While
many of the global trends may be relevant, a contextual analysis of global consumer trends
in relation to Pakistan are discussed below:
15 FONA international Report: https://www.fona.com/resource-center/blog/five-trends-breakfast
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5.3.1: Target Market
5.3.1.1: Health Consciousness youth
Pakistan has seen a huge youth bulge and more and more young people are becoming health
conscious due to spread of media and internet coverage in line with global trends. This is
evident from the Euromonitor report which expects Pakistan to be the fastest-growing
consumer health conscious market in 2016. People especially working men and women want
to appear fit in their social circles. Some even consider this linked to career progressions.
Increasing health consciousness is also partly because of rising diseases. Food available
outside is of questionable quality. Even five-star hotels like Pearl Continental Hotel and Avari
Hotel were found offering food prepared under unhygienic conditions and were heavily
penalized by Ayesha Mumtaz of Punjab Food Authority.16 Under such prevalent
circumstances it would not be surprising to see people shifting towards perceived healthy
foods like cereals.
5.3.1.2: Working women and Housewives

In Pakistan more and more women are entering the labor force to substantiate their family
income and fulfil their professional obligations. This leaves women with less time to cook
food at home and thus there is a rise in outside dinning. However, working women are also
aware of the fact that the health of their family is at risk in outside dining. Therefore, they
work towards minimizing outside dining as much as possible. Readymade easy to cook
frozen foods are gaining huge popularity among working women. Similarly, in breakfast
Cereals are an attractive option for households. Rising disposable income due to both men
and women working together makes the purchase of readymade food easier for the family.
Kellogg and Nestlé are expected to largely drive sales growth in breakfast cereals in the
forecast period, with these players likely to invest heavily in marketing. There will be a
strong focus on targeting health-conscious mid- to high-income women in these companies'
16
Swoop on two five star hotels: http://www.dawn.com/news/1196241
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marketing, with these consumers typically making breakfast choices for their families. In
addition, these players are likely to continue to offer health-focused new product
development in the forecast period. Nestlé Fitnesse, launched in 2016, is meanwhile likely
to see a strong performance at the start of the forecast period thanks to being positioned as
aiding digestion and weight loss.
From secondary research it appears that people of young age might be opting for cereals.
However exact age group and gender segment would become apparent from primary and
exploratory research.
5.3.2: Competitive Landscape
The dominant player as per 2016 data is Fauji Cereals with about 60% market share. This is
because company is one of the oldest existing one in Pakistan offering wide variety with
affordable pricing. Moreover, it has wide distribution network especially in Urban areas.
However, Fauji lost 7% share in 2016 due to mid and high-level income groups preferring
international brands.
Kellogg on the other hand posed double digit growth to capture 14% market share. This was
because of its distribution network expansion that managed to meet growing demand of mid
and high-income consumers. Furthermore, the company also invested heavily in
advertisements. One of its notable advertisement was for Special K that featured Lara Dutta
focusing on weight loss benefits offered by the brand. Another advertisement was for All
bran that featured a busy mother turning to All Bran for energy vitalization. The
advertisement projected All Bran as a healthy breakfast option, emphasizing digestive
benefits through use of whole grains.
Nestlé gained 2% points in 2016 to settle at number three spot among competitors with 9%
market share. It benefitted from the rising health trend in Pakistan. Most important reason
for growth was the launch of Nestlé Fitnesse with the tagline "Shape up your lifestyle." The
brand is advertised as containing whole grain content and low-fat level
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Flakes have benefitted the most in cereals because they have been positioned as a family
breakfast cereal suitable for children and adults and also from a healthy and Western image.
Furthermore, this segment also has active product development like the launching of Nestle
Fitnesse. Further important points in the discussion are:
- 6% retail volume growth and 13% current value growth from 2015 to reach
2,200 tones and PKR3.0 billion in 2016
- Westernization trend benefits breakfast cereals, particularly global brands
- Flakes see strongest current value growth of over 13% in 2016
- 7% current value unit price growth seen in 2016
- Fauji Cereals loses seven percentage points in value share from 2015 but
retains dominance with close to 60% in 2016
- 8% value CAGR at constant 2016 prices expected in forecast period with sales
reaching PKR4.5 billion in 2021
The above competitive landscape would be further confirmed from the primary research
conducted with the LMTs and GMTs.
5.3.3: Place strategy

In terms of distribution, Independent small grocers at present remain the dominant with
54% value share in 2016. This is because of their extensive network of outlets in convenient
locations. However, Supermarkets and Hypermarkets are increasingly gaining ground with
achieving 36% share, a percentage point higher than 2015. This rise in share is because of
changing preference of mid- to high-income consumers, who are the driving force in growth
of breakfast cereals towards Hypermarkets and Supermarkets. Moreover, Hypermarkets
and Supermarkets offer wider variety of Cereals with attractive price promotions.
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The above data regarding strategic placement of cereal would be confirmed through primary
research.
5.3.4: Price Strategy

Breakfast cereals is forecasted to see retail volume growth of 9% in comparison to the 6%
CAGR seen during the review period. Notably, a strong retail volume performance will
strongly be due to more affordable prices being offered by global brands and the increasing
use of price promotions. Consequently, value growth at constant 2016 prices is expected to
soften slightly in the forecast period to 8% CAGR, down from 10% CAGR in the review period.
The overall trend in breakfast cereals suggests unit price decline by 3% with flakes seeing
one of the sharpest drops at 4%. Unit price decline will however be softened by consumers
trading up to brands from players such as Kellogg and Nestlé. Unit price decline will
meanwhile also be softened by high-priced flaks continuing to gain share, with this being the
most dynamic product area in retail volume terms with 10% CAGR in the forecast period.
The increasing use of price promotions for breakfast cereals will be closely linked to the
widening distribution of these products via supermarkets and hypermarkets in the forecast
period. Supermarkets are notably likely to see strong outlet volume expansion, with a focus
on offering more convenient locations. This channel will thus see the strongest gain in value
share in the forecast period and is expected to rise by six percentage points to a value share
of 42% in 2016. Supermarkets will also gain share from independent small grocers thanks
to offering a considerably wider product range, while also benefiting from a growing
preference among mid- to high-income consumers for modern grocery retailers.
These trends would be further investigated in Primary research.
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5.3.5: Product Strategy
Consumer rights advocates are increasingly raising awareness about presence of sugar.
According to them, ideally consumers should choose a breakfast cereal that contains less
than 5 grams of sugar per serving. People are now reading the food label to find out how
much sugar the product contains.17 Matco should keep this finding in mind before launching
their cereal brand. Secondary research does not reveal whether it should be a rice or wheat
based but the tendency is towards wheat cereal. It would be further investigated in primary
research.
17
https://www.ars.usda.gov/ARSUserFiles/80400525/Articles/ProcediaFS2_20-26.pdf
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Target Market Young Adults
Place Focus on LMT and IMT, but Independent Retailers still holds
majority share
Should Go? Yes
Key points: Variety of Cereals, Growth in cereal segment, Price focused, Nutrition
Focused
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Chapter 6: INDUSTRY ANALYSIS
6.1: Summary
The purpose of conducting competitor analysis is to understand competitor positioning of
their products in the target market and effectively formulate a corporate level strategy to
overcome competition.
In this section we study macro level standing and ranking of competitors in Pakistan. Report
from Euromonitor substantiates our study.
This chapter outlines the industry trends, market landscape, prospect in cereal
industry, porter five forces model and CPM
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Breakfast cereals are classified as a luxury product in Pakistan, although with the increasing
demand and changing lifestyle, it is also penetrating the upper- middle and middle-class
segments. The industry has seen a 13% current value growth from 2015 to reach 2200 tones
(Euromonitor International 2016), while the market size has increased to PKR 3.0 billion.
(Euromonitor International 2016). The industry consists of both local and international
brands, with local brand (Fauji Cereals) dominating the market. However, the recent trends
show that international brands are gaining a strong foothold in the market at a very fast pace.
The industry is expected to see 8% value CAGR at constant 2016 prices projected in the
forecast period and sales of PKR 4.5 billion in 2021.
6.2: Industry Trends

The industry trends in the Pakistani market have been summarized below:
a. Breakfast cereals industry is currently seeing an upward trend as customer’s

interests are now becoming more influenced by the Western lifestyle, hence breakfast
cereals is now becoming a popular breakfast alternative. The increase in sales can
also be attributed to the fact that the disposable income is rising, which is encouraging
many customers to switch to international brands such as Kellogg and Nestle.
Breakfast cereals have also benefited from their reputation as a healthy breakfast
alternative due to inclusion of vitamins and minerals. This has made them a popular
choice, especially among the busy urban lifestyle who are looking for a quick and easy
yet healthy breakfast alternative.
b. Breakfast cereal industry has seen a strong double-digit growth at the end of the
review period. But the growth rate of 13% for year 2016 is lower than review period
CAGR of 16%. This can be explained by the lower inflation at the end of the review
period, with a strong retail volume growth of 6% in the year, in line with the review
period CAGR.
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c. While the discounting has risen, however it has not resulted in unit price erosion.
Overall breakfast cereals experienced above-inflation current value unit growth price
of 7% in 2016, with increasing offer of price promotions being offset by customers
switching up to leading brands. This trend was especially prominent in flakes, which
experienced 7% current value unit price growth in the year and was the highest
priced product area.
d. Flakes were the leading product area in 2016, with a strong retail volume growth if
7% and current value growth of 13%. They have 80% retail volume share making it
the dominant product in breakfast category. Flakes were able to achieve this share as
they are positioned as breakfast cereal which is suitable for both children and adults.
Furthermore, they also have a healthy and Western image among consumers and
have benefitted from the continued product development at the end of review period,
e.g. launch of Nestle Fitnesse.
e. The primary distributors for breakfast cereals are small grocers which have a 54%
value share in 2016. This is due to the channel providing a huge number of outlets in
easy to access locations. However, the major growth drivers in breakfast cereals are
mid to high tier customers, are now increasingly shifting to shop at hypermarkets and
supermarkets, as they continue to increase their presence all over Pakistan. The
reason for the popularity of Supermarkets and Hypermarkets is the wide range of
availability of product options as well as price promotions. Supermarket saw the
biggest share gain in 2016 compared to previous year, by gaining a percentage point
and reaching to 36% value share.
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6.3: Market Landscape
a. Fauji Cereals occupies the dominant position in the market of breakfast cereals by the
end of 2016, having almost 60% share in the market. The company’s success can be
attributed to its wide range of products, affordable pricing and longstanding
presence. While the current market share is huge, however, it has declined by 7
percentage points as consumers have started switching to global brands.
b. The second place is claimed by Kellogg, who has seen the biggest growth in its value
share from last year. The company currently has a market share of 14%, which more
than twice its market share over previous year. The company was able to achieve such
phenomenal results due to increase in consumer demand from mid- high-income
class as well as increasing its distribution of products. Another factor which can be
contributed to the Kellogg success is the rising disposable income which is allowing
many consumers to switch to Kellogg due to its brand name. Furthermore, the
company also focused heavily in marketing in 2016 and launched numerous ads,
especially the Special K which focused on weight loss benefits. Kellogg also targeted
mid-to-high income women with TV ads for All-Bran, showing mothers using All Bran
for gaining energy. All Bran was promoted as healthy breakfast alternative,
emphasizing the digestive benefits and use of whole grains.
c. Similar to Kellogg, nestle also showed strong performance in 2016 due to the growing
focus on health consciousness in Pakistan. The company was able to increase its
market share by 2%, achieving a total market share of 9%. It was able to achieve this
result in response to growing demand for global brands among mid to high tier
customers. Furthermore, product development also played an important part, with
the launch of Nestle Fitnesse, which had a tagline of “Shape up your lifestyle”. The
product was promoted based on low fat and whole grain content and was successfully
launched due to strong marketing efforts.
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6.4: Prospects of Cereal Industry
Some prospects of breakfast cereals industry have been explained below:
a. Breakfast cereals are poised to gain traction in Pakistan’s urban mid-income group in
the forecast period. These products have a high-quality and healthy image and are
considered as a convenient breakfast alternative. Hence, they are growing very
popular and are likely to attract many customers. The expected growth can also be
attributed to the busy lifestyle and increase in the number of working women, which
is also expected to increase the future demand.
b. Breakfast cereals is expected to see an increase in the retail volume growth in the
forecast period, with a CAGR of 9% compared to 6% CAGR of the review period.
Robust growth will be seen due to busier lifestyle and rise in disposable income. The
retail performance will also see strong performance due to price promotions and
cheaper prices offered by international brands. Therefore, value growth at constant
2016 price is anticipated to decrease in the forecast period from 10% CAGR in the
review period to 8% CAGR in the forecast period
c. Breakfast cereals are likely to see a decrease of 3%-unit price at constant 2016 prices
in the forecast period, with flakes experiencing the biggest drop at 4%. However, the
unit price decline will be offset by consumers switching to international brands such
as Kellogg and Nestle. The unit price decline will also be cushioned by the continued
growth of high-priced flaks with a 10% CAGR in the forecast period.
d. Kellogg and Nestle are expected to see an increase in the forecast period due to heavy
investment in marketing. Their focus will be on targeting, especially health conscious
mod–to–high income women, as they are the primary decision makers on what to
make for breakfast. Furthermore, both these companies will also focus on product
development of healthy products in the forecast period. Nestle Fitnesse, which was
launched in 2016, is expected to see robust performance at the beginning of forecast
period as it was positioned as health benefitting product which helps with losing
weight and indigestion.
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• The increase in price promotions for breakfast cereals will be accompanied with an
increase in distribution of these products through supermarkets and hypermarkets
in the forecast period. The outlet volume growth will specially be strong in
supermarkets, which will focus on providing more convenient locations. This channel
is likely to see biggest gain in value share in forecast period and will is expected to
increase to 42%, an increase of 6 percentage points. As they will be offering a wider
variety of products, hence they will also take share from small grocery shops. In
addition, they will also benefit from preference of mid-to-high income customers for
modern grocery retailers.
-
Table 4: Sales of Breakfast Cereals by Category: Value 2011-2016 (PKR MN)
2011 2012 2013 2014 2015 2016

Hot Cereals 21.8 26 30.5 34.4 38 41.3
RTE Cereals 1406.3 1707.9 2056.4 2391.8 2654.7 2994.7
Children's Breakfast
cereals 173.7 203.2 238.4 272.4 306.7 339.9
Family Breakfast cereals 1232.6 1504.7 1818 2119.3 2348 2654.8
Flakes 1161.1 1367.2 1657.9 1934.1 2228 2526.8
Muesli and Granola 116.5 137.5 160.1 185.3 120 128
Other RTE Cereals - - - - - -
Breakfast cereals 1428 1733.9 2086.9 2426.2 2692.7 3060
Source: Euromonitor International from official statistics, trade associations, trade press, company research and store checks, trade interviews,
trade sources.
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6.5: Porter Five Forces Model
6.5.1: Rivalry Among Competitors

The breakfast cereal industry is mainly occupied between three main rivals, namely Fauji
Cereals, Kellogg, Nestle. Of these, Fauji Cereals, a domestic producer has the highest market
share, with Kellogg and Nestle occupying second and third position respectively.
6.5.2: Potential Entry of New Competitors

Breakfast Cereal is looking to be a very promising market in future, which in turn has
resulted in very tough competition between the existing players in the market. Hence the
biggest barrier for a new entrant will be too able to make a niche for itself among the existing
players. This will not prove to be an easy task, since all the three companies are very big
companies, reputable brand name and already occupy a huge chunk of market share.
Furthermore, a new entrant will also have to consider the financial considerations since
opening a new plant is extremely cost intensive, not to mention the labor cost, maintenance
etc. Such restriction will prove to be very problematic for a new player to enter in the market.
6.5.3: Potential Development of Substitute Products

Breakfast cereal are used as a substitute for breakfast due to their ease of preparation and
convenience. That is not to say that the product itself cannot have any substitutes. Companies
like Weetabix, have launched Alpen Light bars, which can be eaten on the go, while retaining
their nutrition and taste. Similarly, Granola bars, which are also high in nutrition are often
consumed due to their ease of use. Continental biscuits have introduced the Wheatable
biscuits, which have 5X more fibre, and is available in sugar free option too.
6.5.4: Bargaining Power of Consumers

In breakfast cereal industry in Pakistan, consumers have a great bargaining power. This is
mainly due to the availability of strong competition, which provides them the option of
switching to another company, if they are not satisfied with a product. Another factor which
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gives rise to greater bargaining power is the availability of wide variety of products,
especially in LMTs. This wider choice allows customers to easily switch between different
brands.
6.5.4: Bargaining Power of Supplier

Should Matco choose to go for rice-based cereals, it would be in a unique position as it would
be a supplier for itself. This means that it would not have to cave in to the pressure of
demands of its suppliers and will be able integrate the sourcing process extremely well with
the company’s current business.
6.6: Competitor Profile Matrix

The competitor profile matrix compares the relative strength of various factors on which the
firms compete with each other. The scores are broken down and explained below:
1) Market share: - Fauji Cereals has the largest market share, occupying nearly 60% of
the national market. While the market share has decreased from previous year,
however it is still by far the biggest player in the market. It is followed by Kellogg’s
which has the second biggest market share, followed by Nestle. Both the companies
have seen a rise in their respective market shares, however they are still well below
Fauji Cereals.
2) Brand Reputation: - Being one of the most well-known brands in the world,
Kellogg’s scores highest in the category as the most recognizable and preferred
brand.
3) Product Quality: - All the three brands are known for their high-quality products,
however, customer’s responses favored Kellogg’s over the remaining brands, citing
it as a higher quality product.
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4) Product Variety: - Kellogg’s is the clear winner in this category with a huge
portfolio of brands ranging from Coco Balls, Corn Flakes, Froot Loops etc. Nestle is
ranked second and Fauji is ranked third.
5) Management: Kellogg’s and Nestle both rank above Fauji, as the management in
Fauji Cereals is influenced very much by Pakistani Army. According to a study, 33
out of 141 former Pakistan Armed Forces corps commander were given jobs in the
Fauji Foundation, of which Fauji Cereals is a subsidy. Kellogg’s and Nestlé’s
management on the other hand are not influenced by any such external parties.
6) Global Expansion: - Kellogg’s has the greatest presence in the international market,
with the company operating in over 180 countries. Nestle is ranked second while
Fauji is ranked third.
Table 5: Competitor Profile Matrix
Critical Success
Factors Weight Rating Fauji Rating Kellogg Rating Nestle
Market Share 0.15 4 0.6 3 0.45 2 0.3
Brand Reputation 0.1 3 0.3 4 0.4 3 0.3
Product Quality 0.02 3 0.06 4 0.08 3 0.06
Product Variety 0.1 2 0.2 4 0.4 3 0.3
Technology 0.08 2 0.16 3 0.24 3 0.24
Management 0.1 3 0.3 3 0.3 4 0.4
Advertising 0.05 2 0.1 2 0.1 3 0.15
Customer Loyalty 0.1 3 0.3 3 0.3 3 0.3
Online Presence 0.15 2 0.3 3 0.45 3 0.45
Employee Loyalty 0.05 2 0.1 3 0.15 3 0.15
Global Expansion 0.1 2 0.2 4 0.4 3 0.3
Total 1 2.62 3.27 2.95
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Chapter 7: MARKET RESEARCH
This chapter outlines the market survey and the In-depth market interviews along
with their analysis.
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7.1: Summary
The main purpose of primary research was to get the insights into the cereal market. To meet
this objective, primary research was divided into the following:
a) Market Survey
i) LMT/IMT Interviews
ii) General Trade Interviews
b) In-depth Interviews
i) Doctors
ii) Suppliers
iii) Competitors
c) Focus Group
Market Survey was done to acquaint with the market knowledge about the breakfast cereals.
This survey was divided into two parts: LMT/IMTS and general trade. The division was made
considering the two distinguish type of markets in Karachi. The survey was important to
understand the different variables important to the retailers and wholesalers pertaining to
purchase. Before visiting stores, detailed questionnaire was prepared to be asked from store
managers to identify key variables of breakfast cereals from their perspective. The survey
was done independently and sampling was done randomly.
In-depth interview was done with an aim to get the insights from the competitors and their
suppliers themselves. The objective behind it was to understand the business structure of
the leading names in breakfast cereals and to identify the variables that contribute to their
success. In-depth interviews of distributors were also done to fathom how efficiently and
effectively distribution is carried out to ensure the sales. In addition to this, doctors were
also added to in-depth interviews because of the nature of the cereals. We wanted to
investigate whether the cereals are prescribed or recommended by doctors or not.
In this chapter, we will discuss the market survey and the in-depth market interviews
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7.2: Market Survey
The market survey was conducted to learn about the variables that are weighed in more by
the LMT/IMT and general trade when making purchase. It was also important to understand
the overall prospect of the breakfast cereal from store managers’ viewpoint. Structured
interviews were done to get the insights. The outline of the questionnaire is attached in the
Appendix B.
7.3: LMT/IMT
7.3.1: Objective
The objective of survey was to understand and evaluate the breakfast cereal market from
five aspects: competition, marketing, distribution, consumer behavior, and Matco’s
perception.
7.3.2: Scope of LMT/IMT

As a part of a primary research, we conducted a market survey of all the renowned
LMTs/IMTs of Karachi. We were able to get insights into the breakfast cereal market from
the store managers of these LMTs/IMTs. In Karachi, we covered areas like North Nazimabad,
FB Area, Buffer zone, Nazimabad, Bahadurabad, Gulshan and DHA. Following stores were
included in our survey: Hyperstar Clifton, Hyperstar Lucky One, Naheed Super Market,
Hyderi Super Market, Shazz, Diamond Super Market, Anchor Mart, Ami’s Store, EBCO, and
Paradise Store. Individual responses of the stores are attached in Appendix C
7.3.3: Findings
Based on the compilation of feedbacks from store managers to address the objective of the
survey, following are the finding of this survey:
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7.3.3.1: TARGET MARKET
Majority of the consumers of cereals are kids followed by adults. Kids trigger the need
and the purchase is mostly made by the housewives on monthly basis. Adults usually
purchase oats, porridge and whole grain. Nestle koko krunch and Kellogg’s coco pops are
popular variants among kids.
7.3.3.2: COMPETITION
According to our survey of LMTs/IMTs, Kellogg, Fauji, Nestle, Weetabix and Post
Consumer Brands are the leading names in breakfast cereals. Kellogg is dominating the
cereal market and shelf spaces of LMTs/IMTs in Karachi because of three main reasons.
Firstly, it is available in many variants unlike other brands that offer limited range.
Secondly, it is an imported brand that itself creates a perception of superior quality
among consumers. Thirdly, its products are offered at a competitive price lying in a same
price bracket as local product.
In breakfast cereal, competition is based more on variants than on prices. According to

store managers, customers primarily look for variants and price is their secondary
concern. Since all the cereals lie in a same price range, so most of the time price is taken
out of the equation. In local brands, Fauji and Nestle offer a very limited range but are
considered among reputable brands. In addition to this, Post Consumer Brand is sold in
bigger stores with bigger shelf spaces like Naheed, Hyperstar and Hydri Super Market.
7.3.3.3: PRODUCT NAME

It’s observed that the name that is used by the cereal manufacturer is mostly the branded
house. They extend their good reputation of their company to their cereals to create a
reliability and give credibility to the brand. Since most of the brand name is related to the
variant of the cereals, so the companies use branded house to market and differentiate
its products for example Nestle Milo, Nestle Corn flakes, Fauji chocolate pops, Fauji Bran
Flakes, kellogg’s All Bran, Kellogg’s Chocos Duet to name a few.
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7.3.3.4: PRICE
In breakfast cereals, people are more brand conscious than price conscious. If they like a
particular brand then they would purchase it regardless of the price. Sometimes
customers ask sales representatives to recommend them a cereal. In such a scenario,
sales reps recommend them Kellogg because of greater variants. Kellogg’s is more of a
premium brand with its UK range present in IMTs and LMTs, while same Indian range is
priced relatively lower to compete with Fauji in GTs.
Big stores that buy cereals in bulk usually avail trade discounts incentivizing them over
smaller stores. They are also given trade offers on the short expiry cereals that usually
included buy one get one free.
7.3.3.5: PRODUCT
One of the major problems faced in cereals is of worms other than expiry issues. Fauji’s
Dalliyah or porridge products often become infested with worms because it is the type of
product that develops fungus if air enters the packaging. They receive a lot of complains
about cereals, especially about the issue of worms. Post and Weetabix usually have a lot
of complains. Cornflakes have higher sales compared to rice-based cereals.
7.3.3.6: PLACE
It is observed that in LMTs, companies have to purchase shelf spaces in order to display
its product. The strategy used by Kellogg’s is to occupy more and more shelf space even
with the products that are not in demand. Majority of the stores we surveyed had the
shelves of cereals placed in a prime location. They sell out shelf spaces to companies to
buy eye level shelf placement. It is also observed that Kellogg’s has focused mostly in
LMTs and IMTs than GTs where Fauji is very effective because of efficient distribution
system. Nestle also has a good penetration in both LMTs and IMTs, but have a lesser share
because of other several reasons.
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Since the purchase of cereals is done on weekly and monthly basis, its replenishment is
done by the distributors according to the need of the stores. Most replenishment is done
on weekly or monthly basis subject to the sales of the stores; however, weekly visit is
mostly made by a company representative.
Policy of returns is dependent on the company’s policy. Imported brands like Kellogg and
Post are not returned because it would result in a loss to the store. Credit terms are given
to the stores who buy in bulk. Fauji has the most-friendly return policy. Some stores also
have their own policies of return like 3days return policy.
7.3.3.7: MATCO’s PERCEPTION

Falak rice holds a very positive perception in rice market among consumers. It is the most
sought out brand in rice. It is regarded as a good brand in both pricing and distribution.
However, signature biscuit that was launched by Matco is not perceived well in the
market.
7.4: General Trade

7.4.1: Objective
The objective of the surveying general trade was to understand and evaluate the breakfast
cereal market from five aspects: competition, marketing, distribution, consumer behavior,
and Matco’s perception.
7.4.2: Scope of General Trade

In continuation to our market survey, we conducted a survey of general trade to get the
insights of those consumers who visit GTs in the vicinity rather than LMTs for grocery.
As a part of this survey, we chose 14 random areas and within those areas we visited 5
random shops to gather the data on morning cereals. The areas that we visited are: Gulshan
Block 14, Gulistan-e-Johar, Badurabad, Sindi Muslim, FB Area, Buffer zone, North Nazimabad,
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Nazimabad, Gulshan Block 4, Defence Phase 6, Defence Phase 2, Clifton Block 2, Clifton Block
5 and Malir. Name of all the stores visited are attached in Appendix D
7.4.3: Findings
Based on the compilation of feedbacks from shop keepers to meet the objective of the survey,
following are the finding of this survey:
7.4.3.1: TARGET MARKET

According to our survey, consumers in upper and upper middle areas like Defence,
Clifton, Bahdurabad, North Nazimabad, and Gulshan were more brand conscious.
Consumer living in lower middle areas like Nazimabad, FB Area and Buffer zone were
more price conscious.
Purchases in these stores were made regardless of the gender. Consumers would
often prefer Nestle over Fauji because of greater variety and brand name. However,
when It comes to Corn Flakes then Fauji was the name consumers would seek.
Kellogg’s is more popular among youngsters because of the unique variety it offers
like Fruity Loops, Coco Pops, and Red Berries to name a few. Nestle’s cereal Milo is
very popular among kids, whereas Fauji’s corn flakes, barley and porridge are
popular among both kids and adults.
7.4.3.2: Competition
According to our survey of general trade, Fauji, Nestle and Kellogg’s are the leading
names in breakfast cereals. There was low or no presence of Weetabix and Post
Consumer Brands that were present in LMTs and IMTs.
Fauji was a dominant force because of its low price and greater penetration. Nestle
was also neck to neck with Fauji because of greater variety and penetration. People
would often purchase Nestle because of the brand name. In posh areas like Defense
and Clifton, Kellogg’s would be sold more often because people in these areas were
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more brand conscious than price conscious. However, the fierce competition was
noted between Nestle and Fauji only because of their distribution and pricing mainly.
7.4.3.3: PRODUCT NAME

All the manufacturers follow branded house, when it comes down to cereals. They
leverage the name of their company to market the cereals and extend their already
well-established reputation of their company to their cereals to give credibility to the
brand. Since most of the brand name is related to the variant of the cereals, so the
companies use branded house to market and differentiate its products for example
Nestle Milo, Nestle Corn flakes, Fauji chocolate pops, Fauji Bran Flakes, kellogg’s All
Bran, Kellogg’s Chocos Duet to name a few.
7.4.3.4: PRICE
In general trade, there is more competition in terms of price than LMTs and IMTs.
Fauji because of its low price and better distribution is able to have a greater market
share than Kellogg’s and Nestle’s combined. In order to compete with Fauji in GTs,
Kellogg’s has started importing range from Indian plant to price its product
competitively. Nestle on the other hand has maintained its premium pricing in both
GTs and LMTs/IMTs.
7.4.3.5: PRODUCT
One of the biggest concerns for GTs was of short expiry. Many stores in lower middle
areas like Nazimabad, FB Area, and Buffer Zone were reluctant to keep cereals in bulk
because they would often get returns from customers which would not be timely
lifted by the distributors.
It is also observed that, the most commonly sought-after cereals were wheat, whole-
grain and corn based, whereas rice cereals were hardly to be found. Even though
Kellogg’s have rice cereals, but due to low demand retailers are reluctant to keep it.
The average monthly sales of cereals per shop were 12 pieces.
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There is a great demand of Corn flakes produced by Fauji followed by Nestle’s. Other
popular products of Nestle include Koko Krunch and Milo. Similarly, the best seller of
Kellogg’s among GTs is also Corn Flakes.
7.4.3.6: PLACE
Unlike in LMTs and IMTs where companies would buy shelves to place their products,
such trend was not observed in GTs. When it comes to GTs, Fauji and Nestle mostly
capitalize on their penetration for greater sales. Kellogg’s on the other hand has a
weak penetration and because of it suffers to make a greater impact on GTs while
being successful in LMTs and IMTs. Because of poor distribution, many retailers
especially in lower middle areas are reluctant to keep the stock because of return
issues from customers.
Furthermore, in lower middle areas like Nazimabad and buffer zone, there was a
serious reservation of the retailers on distributors as they would not make any visits
and as a result most of the stores would have to buy cereals from LMTs or IMTs to
cater the need.
Moreover, another reason for the low sales of Kellogg’s in GTs was that they would
not make frequent stock checks as a result retailer were left with no option than to
discard the expired stocks. Kellogg’s was doing relatively better in bigger GTs in
upper and upper middle areas.
7.4.3.7: MATCO’s PERCEPTION

Despite the fact that most of the sample of GTs we targeted had their own rice brands,
but according to them Falak holds a good repute in the rice market and is regarded
highly by the consumers.
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7.5: In-Depth Interviews
In-depth interviews were done with the doctors, suppliers and competitors. Interviews were
conducted to understand the key respective variables of breakfast cereals. Structured
interviews were done to get the insights. The outline of the questionnaire is attached in the
Appendix E.
7.5.1: Doctors
7.5.1.1: Objective
The objective of interviewing doctors was to fathom whether breakfast cereals are being
recommended and prescribed by doctors or not.
7. 5.1.2: Scope of Interview

We conducted in-depth interviews with doctors and nutritionists to obtain information
directly from them. Interviews were conducted on a one-to-one basis and each interview
lasted between 25-30 minutes.
We conducted interviews from nutritionists, cardiologists and pediatrician in order to cover

patients with various age groups, as every age group has different demands and body
requirements when it comes to having cereals in their diet. List of all the doctors and their
respective hospitals can be found in the Appendix F.
7. 5.1.3: Findings
7.5.1.3.1: RECOMMENDATIONS
As per our findings, recommendation of cereal is not limited to patients only since
cereals contain healthy food items which make it favorable to every individual who
wants to have healthy and balanced diet. However, few doctors mentioned that they
recommend it to the nutrient deficit patients. It is most commonly recommended to
kids as cereals are important for this age group who are in growing stage and they
are in need of balanced nutrients.
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However, proper evaluation is done before recommending it to patients, and most
importantly cereals containing high sugar levels are prohibited specially in diabetic
patients or who are prone to develop diabetes. In same way, patients having heart
disease are not allowed to take cereals containing fat and potassium phosphate.
7.5.1.3.2: AGE GROUPS

Cereals are not only referred to kids, our respondents consider cereals equally
important for adults as well but it varies from health and body requirements of every
individual taking in.
7.5.1.3.3: BRAND PREFERENCE

Out of 12 respondents, 5 recommended Nestle cereals, 1 mentioned Quaker oats and
the remaining ones were indifferent in recommending any brand to their patients as
they focus more on ingredients that should be there in diet regardless of the brand
that is being consumed. Upon discussing if any of the available brands’ representative
contacted them to project their sales or increase recommendation, neither of them
was approached by any company.
7.5.1.3.4: REASONS FOR CONSUMPTION

Furthermore, it seems that the sole reason for cereals intake is balanced diet and
proper proportion of nutrients in diet; as almost all of them talked about cereals being
healthy option to be consumed by everyone. Nutritionists also mentioned low amount
of sugar and high fibers as the main reason to recommend cereals to their patients.
Cereals are a rich source of protein, carbohydrates, vitamins, minerals and other
nutrients that are necessary for our bodies. Cereals are rich in fiber which prevent
weight gain and its consumption is beneficial for heart patients as well.
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7.5.1.3.5: RESERVATIONS
Regardless of any disease, respondents are not in favor of highly processed cereals as
they contain preservatives and food additives which are toxic for our body
mechanism.
7.5.2: Suppliers
7.5.2.1: Objective
The objective of interviewing suppliers was to understand the distribution of brands that
have their company located in the Pakistan, and to study the imported brands and its
marketing and distribution policies by its local distributors.
7.5.2.1.1: International Brands Limited

International Brands Limited began its journey with distribution house several
generations ago. With the progress in business, the group established offices in cities
like Karachi and Lahore. After the partition of Pakistan, its Head Office was moved to
Karachi and became the reputable distribution house in Pakistan under the name of
United Distributors (Pvt.) Limited.
Today, UDL represents various prestigious brands like Johnson & Johnson, Pringles,
Kellogg’s, Red Bull, and Mars to name a few. They offer services like: brand activation,
brand communication, in-store promotion, marketing intelligence, trade marketing,
channel development, merchandising and pricing.
7.5.2.1.2: Objective
The aim was to understand the efforts by IBL to establish this cereal brand in the
Pakistani market and to identify forces that effect the decision making in the
distribution of an international cereal brand.
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7.5.2.1.3: SCOPE OF INTERVIEW
One to one unstructured interview was conducted with the Key Account Manager, Mr.
Shoaib Hassan on 11th November, 2017. This detailed interview lasted for ninety
minutes and covered all the business aspects of IBL related to Kellogg’s, be it
marketing and distribution or prospect of category itself.
7.5.2.1.4: FINDINGS
7.5.2.1.4.1: TARGET MARKET
Kellogg’s also has a lot of variants. IBL introduced fruit’n fibre, special K
alongside cornflakes for health-conscious customers, mostly female
customers. Coco pops and fruit loops for kids.
Kellogg’s was targeted at the upper class of Pakistan with higher income levels
right from the start. Kellogg’s was supplied to Pakistan from its plant situated
in the UK. In 2012 Kellogg’s started a plant in India, which started supplying
IBL with the Indian range. This plant handled all the supplies in Asia and since
the range was low cost, it catered to the lower middle-class population
residing in the South Asian and other Asian countries. At the moment IBL has
three cereal ranges available; the first one is the UK range which caters to the
tastes of the upper class residing in the areas of Defense and Clifton, PECHS.
Customers residing in these areas
can distinguish between the tastes
INDIAN UK
of different cereals as well and are PLANT PLANT
taste conscious. Price comes second
for these customers. Secondly the
Thai range and thirdly the Indian
range. In Karachi the UK range IBL
commands more, sales.
Figure 2: IBL Plants
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7.5.2.1.4.2: COMPETITION
When IBL launched the Indian range, they kept the price range below Fauji
cereal which was popular in the low-price segment. Nestle and Fauji both
carry out BTL activities all over Pakistan, but, for Kellogg’s the company does
not designate any amount for media spending. Since Kellogg’s share of south
Asia is only 22% of the total sales all over the world. It is not feasible for the
company to spend a lot on advertising.
IBL get reports from Nielsen every year. And according to Neilson the market
share of Kellogg’s is 85% in identified shops. Which are mostly LMTs, A and B
class stores and petro stores. Nestle stands at 10% and Fauji and others stand
at 5%. Karachi and Lahore contribute 40% each to the overalls sales of
Kellogg’s nationwide. Since the market share of Kellogg’s is bigger, the value
share automatically is bigger.
SHARE
LMT/ CLASS A & B STORES
Kellogg's Nestle Fauji & Others
5%
10%
85%
Figure 3: LMT Share
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7.5.2.1.4.3: PRICE
Since the customer awareness and income levels are rising, those customers
who want to consume cereal, try to pick up the best and since IBL has made
Kellogg’s available at all price points in the market, it is easy for the customer
to make the decision and they go for Kellogg’s, due to its strong brand equity.
In LMTs and IMTs, Kellogg’s mostly stock its UK range, while in GTs, they stock
Indian range which is relatively cheaper.
7.5.2.1.4.3: PRODUCT
In terms of new product development, in 2014, IBL developed a K pack for one
of its variants namely Coco pops. These are small snack packs. At the start, the
volume of these packs was 5.5 million nationwide. Then in 2 years’ time, the
sales of K pack grew and IBL expanded its distribution network from 1800
stores to 7000 retail stores nationwide. By 2017 the number of stores went up
to 13,000. K pack has a share of 40% in the overall sales of Kellogg’s cereals.
Now K pack’s volume is 75 million per month. These packs are designed to
attract kids, who purchase snack such a bag of chips with their pocket money.
K pack has the perception of a healthy snack in the eyes of the mothers who
influence the kids to buy a healthier snack.
7.5.2.1.4.4: PLACE
IBL is not expanding the market because its distribution network still has a
long way to go, for example, out of 50,000 shops in Pakistan, Kellogg’s is
available in only 1800-2000 shops, so IBL still has to enhance their
distribution. So IBL does not focus on ATL and BTL activities, and they focus
on building their distribution network instead.
IBL makes sure that wherever Fauji cereal is available, the Indian range of
Kellogg’s is also available. Company keeps the margin of 15%. The sales reps
are dedicated and are compensated and supported by IBL to increase the
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penetration of Kellogg’s. Principal supports IBL on the basis of ROI to be
achieved. We work to achieve an ROI of 2.5-3%.
IBL has to pay less for the shelf space for Kellogg’s at LMTs and IMTs, because,
now the brand equity is so strong that stores feel that if they want to build
their cereal category, then having Kellogg’s on the shelves is very important
for them. Fauji recently launched its BTL activities in LMTs but ever since the
Indian range if Kellogg’s has entered the market, customers have shifted to
Kellogg’s as they are getting an imported product at the same price.
7.5.2.1.4.5: TASTE
In terms of taste, there are people in high income areas who find the taste of
the UK range to be better and are satisfied with the quality. The Indian range
while being affordable has a slight change in the taste, but, this change can only
be identified by the regular user. So when the lower middle class goes out to
purchase Kellogg’s cereal, they still see it as imported cereal form the west and
feels satisfied that the price falls within their range, although it is being
supplied by the Indian plant. This is all because of the strong brand equity of
Kellogg’s.
RETAIL COVERAGE
Retail Coverage
14000
13000
12000
10000
8000
7000
6000
4000
2000 1800
0
2014 2016 2017
Figure 4: Retail Coverage
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7.5.2.1.4.6: MARKET GROWTH
IBL has observed that growth in the cereal category is also very slow. New
product development is not being done because cereal users are very specific
in their choices and there is less probability that existing customers will pick
up a new product instead of a tried and tested product. The reason for this is
that new end users are not being created. A lot of customers used Fauji
cornflakes in illness and Kellogg’s took this share from Fauji when it launched
its Indian range which was available at the same price range. Before that the
price of a 500-gm cereal box of Fauji was 200 and that of Kellogg’s was 800
rupees. So, these customers gained by Kellogg’s were already the users of
cereals who shifted their brand but new end customers were not added to the
fray. Neither Kellogg’s nor Nestle and Fauji worked towards gaining new first-
time users.
7.5.2.1.4.7: DEMAND FORECAST

IBL forecasts its demand SKU wise (which SKU performed better in the last
year) and seasonal impact is also considered. Like during winters the
consumption of cereals increases as people become more health conscious.
IBL assumes that if an SKU performed well during last year then this year it
should see a growth of 30%. The lead time of Indian plant is one month. The
expiries of Kellogg’s are after 9 months. The lead time of UK range is 3 months.
So, by the time it reaches here the product expiries are reduced to six months.
IBL has to lock its order with the plant, and in case of emergency the supply
cannot be compensated, since one plant has to supply to multiple countries
within one region. So, the demand received by the plant form Pakistan is fixed
and in case of any unforeseen event the demand will be disrupted so IBL has
to develop a robust plan.
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7.5.2.1.4.8: SCOPE OF RICE CEREALS
Kellogg’s has a rice variant by the name of Rice Krispies, but, it was not
accepted by the consumer, on the other hand corn cereals are more popular. If
cornflakes sell 800 boxes than Rice Krispies only sells around 30-40 boxes.
7.5.2.1.4.9: RESEARCH & DEVELOPMENT

IBL has currently struck a contract with Mckinsey for the next 5 years to help
it with market research and organizational development. Training personnel
in the personal care, chocolates and food divisions. IBL has 4 branches in
Karachi. Head office is at NICL building and Directors reside in the building
center.
7.5.2.2: Burque Corporation Private Limited

Burque Corporation was incepted in 1967 with the manufacturing of battery cells and then
diversifies themselves into trading. Burque Corporation was awarded as the distribution of
Nestle in 1974 and since then it has been playing vital role in its distribution. Since 1989,
Buque has expanded in FMCG distribution. It distributes, food, non-food, chilled, home care,
personal care and beauty products across Pakistan. Today, this company worth over Rs. 35
Billion
The objective behind this interview was to comprehend the distribution system of
Nestle which has always played a key role in making its brands available to every
shop across Pakistan.
7.5.2.2.2: Scope of Interview

One to one unstructured interview was conducted with the Area Sales Manager, Mr.
Abdul Muhi Qazi, who was representing Burque on 23rd November, 2017. This
detailed interview lasted for 45 minutes.
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7.5.2.2.3: Findings
Nestle cereals are targeting kids through their advertising and BTL campaigns.
Kids are influencers in this market and mothers are customers. Although
cereals are profitable for Burque, but they are a very small portion of the
overall business. Nestle very rarely opt for ATL for cereals but highly for other
brands. BTL activities are held at children’s events at schools. For cereals, they
mostly rely on sound distribution supported by the Nestle’s own reputation in
the market. Nestle’s consumers are loyal to because of high quality and
reputation and so they tend to switch more between two brands of the same
company rather than other’s.
Nestle is divided into three categories namely: food and beverages, water and
chilled dairy. Nestle cereals is a very small part of food and beverages division.
Fauji’s sales are way more than Nestle. In terms of competition, nestle faces a
fierce competition from Fauji in GTs and from Kellogg’s in LMT’s and IMTs,
thus they often find themselves in between because of high share of Kellogg’s
in LMTs/IMTs and Fauji’s in GTs.
7.5.2.2.3.3: LOCATION
In the south zone they have divided Karachi into different areas. And
demarcated territories, on the basis of value, distance, geography etc. There
are 4 warehouses of Burque in Karachi in the areas of Malir, Korangi, Site and
FB area. The capacity of each plant is approximately of holding 1200 pallets.
Nestle has two factories in Skeikhupura and Kabirwala which manufacture the
entire range of Nestle’s products.
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7.5.2.2.3.3: PRICE
One weakness of Nestle is its premium pricing, but nonetheless loyal
customers buy it anyway. Nestle’s customers are more brand conscious than
price conscious, so they tend to switch more among brands of Nestle than
other companies.
7.5.2.2.3.3: PRODUCT
Since Nestle offers various product lines, so for them cereal constitutes a very
small business. Even though it is a profitable business and there is a little
growth every year, but the market of cereals is very concentrated to the urban
areas. For them, the two most running brands are Nestle Koku Krunch and
Milo both target kids. For success in cereals, Nestle depends upon Koko
Krunch and Milo which are made up of Whole grains. Corn Flakes also
constitute a good chunk of business. On the other hand, there is no to less
market demand of rice cereals.
7.5.2.2.3.4: PLACE
Nestle’s expertise lies in production and so distribution is outsourced by
Nestle to third party distributors in Pakistan. Nestle does not rely on single
distribution. They have multiple distributors based on regions. South region
that consists of Sindh and Balochistan is covered by Burque Corporation. From
the point of manufacturing to distributor, Nestle uses its own transportation
and there onwards distributors transport to retailers.
Imported products first land in the factory and from there the products are
distributed all over Pakistan. Nestle’s KPIs are availability, target achievement
and out of stock management. Nestle uses order booking model for its cereals.
Each sales representative has to cater to 50 retailers per week. Viability of each
van is then calculated and route to market plan is thus designed. Trade offers
are given periodically just to give a boost to the sales of cereals.
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In the south zone which comprises all the areas of Sindh and Baluchistan, the
distribution of Nestle is handled by Burque Corporation. Burque was importer
of Nido powdered milk in Jodia market in Karachi, and in 1980s Nestle landed
in Pakistan and bought Milkpak form Mr. Babar Ali and also introduced their
own products. Mr. Babar Ali was a well-known industrialist of Pakistan and he
became a member of Nestles board in Pakistan. So, it was agreed between Mr.
Babar and Nestle that the existing importers of Nestle’s products will be
turned into the distributors and so Burque distributors came into being. They
have now diversified their business.
Nestle also pays to LMTs for shelf space. They buy the entire shelf and place
goods according to their promotional strategy. For their BTL, they place
attractive kiosks at various LMTs.
7.5.3: Competitors
7.5.3.1: Objective
In order to understand the dynamics of the market, it is imperative to study about the
competitors as well. With this on mind, the objective of interviewing competitors was to
understand the business model and get insights of breakfast cereals from their perspective.
7.5.3.1.1: FAUJI CEREALS

Fauji Cereals was incepted in 1954 and it’s a fully owned company of Fauji Foundation
in collaboration with Quaker Oats, England. In Pakistan, Fauji pioneers the
manufacturing of breakfast cereal that includes ready-to-cook and ready-to-eat
categories. At the start only, cornflakes were the product sold, but gradually more
variants were introduced such as Frootooz and Choco flakes. A Porridge line was also
started which currently has two variants by the name of wheat porridge and barley
porridge.
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Fauji has a share of more than 70% in Pakistan including porridges and flakes. Fauji
h-as not limited its market to Pakistan only, but also is one of the biggest exporter of
cereals abroad owing to its high quality. Fauji has been a market leader for over six
decades and showcases the variants like Corn Flakes, Wheat Flakes, Rice Flakes,
Wheat Porridge and Pearl Barley to name a few. For Fauji, Corn Flakes has been the
best seller since its introduction. In addition to this, Fauji also does CSR activities and
has been a part of WFP and UNICEF as a leading manufacturer of emergency foods for
pregnant women and babies.
The objective of interviewing Fauji was to comprehend the variables that made them
the market leader in breakfast cereals and to understand the prospect of breakfast
cereal market in general.
7.5.3.1.3: Scope of Interview

One to one unstructured interview was conducted with the Regional Sales Manager,
Mr. Javed Niaz on 15th November, 2017. This interview lasted for sixty minutes and
covered all the business aspects of Fauji Foundation related to Cereals.
7.5.3.1.4: Findings
According to Fauji, they target both kids and adults for their cornflakes, which
is the most prolific product for them and constitutes the highest share in
breakfast cereal. However, they do not engage in any kind of marketing
activity that would establish their specific target audience. It is by far mostly
consumed by kids of age 10 and above. Since, Fauji is a very old brand and has
done very little to revamp its packaging, it is also considered a favorite brand
for old people.
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In 2011 a survey was conducted by Gallop Pakistan and according to that
survey Fauji cereal commanded 75% of the market share. Ever since Fauji has
not conducted any third-party market research since the top management is
reluctant to allocate expenses to the research through third party consultants
such as Mckinsey and A.C. Neilson.
When it comes to cornflakes, then Fauji is by far the best consumer’s choice
with an exception in other products like wholegrains and oats. Fauji in order
to compete in all the avenues besides cornflakes, they have started accepting
that in order to remain ahead in competition they need to have expertise in
both marketing and sales. In 2011, the company hired regional sales managers
and area sales managers. Three regions were designed namely south, central
and north. Even now sales team is not being incentivized to push the sales and
their compensation is not increased according to work load.
7.5.3.1.4.3: LOCATION
Fauji has only one plant of cereal in Rawalpindi. This plant was left by Quacker
oats in pre-partition era and was built on the Pakistan army land. So, this plant
was acquired by Army 1952 and after 1972 it became a part of the Fauji
foundation.
Fauji has a national warehouse in Rawalpindi from where the product is

distributed to warehouses nationwide. All over Pakistan, Fauji has its own 275
warehouses. In Karachi, Fauji has 4 warehouses. In South there are 35 total
warehouses which cover areas of Sindh and Baluchistan.
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Regional
Plant (RWP) Warehouses Consumers
National GTs / LMTs /

Warehouse IMTs
(RWP)
Figure 5:Fauji Warehouses
7.5.3.1.4.4: PRICE
Fauji has priced its products on the lower end relative to its competitors. One
reason of highest market share is because of its low price which results from
local manufacturing and saving in marketing budget. Instead of engaging in
marketing activities, Fauji has rather focused on its low pricing supported by
a strong distribution system for greater penetration.
7.5.3.1.4.5: PRODUCT
Fauji has a rice cereal which is not very popular. Cornflakes and porridge
constitute a bigger chunk of the sales. Fauji focuses on the quality of the cereals
and retailer’s complaints are promptly addressed and expired or damaged
product is lifted up.
7.5.3.1.4.4: PLACE
Primary orders are generated at the warehouses and national warehouse
dispatches the orders to respective warehouses. The distribution process is
controlled by Fauji itself. Premier used to handle Fauji’s distributor, but, the
contract was ended to have more control on the distribution process.
Fauji focuses more on GTs than LMTs and IMTs, former constitutes a bigger
pie than latter combined. Their strong distribution network has ensured the
presence of its products even in the smallest store of the area. Their
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distribution is also well supported by its strong return policy encouraging
shops to stock without any reluctance.
7.5.3.1.4.5: MARKETING & SALES

Since 2011, Fauji has conducted 4 to 5 ATL campaigns. Before 2011, there was
no concept of a central marketing and sales department within Fauji cereals
division. Fauji has strong penetration in small areas, suburbs of Karachi.
Fauji’s customer base consists of loyal customers. Fauji enjoys the share of
over 70% more because of strong distribution and pricing than marketing
engagement.
7.5.3.1.4.6: BUSINESS OUTLOOK

Fauji has no competition with Kellogg’s, as it is a player in the international
market. The new generation is now seen shifting towards Kellogg’s. Expats
who return with changed preferences also influence the local buyers, so a shift
towards Kellogg’s is conspicuous. When Kellogg’s first showed signs of
dominating the market, the product integrity of Fauji was endangered as its
shape was inferior to Kellogg’s, so Fauji decided to import Buhler plant from
Switzerland, in 2011, to improve its product quality. Fauji cornflakes was
relaunched after Kellogg’s had started dominating the market.
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Name Brand Name Known to Consumers
Target Market Children, Adults, Housewives
Flavor Nutrition Oriented
Place LMT and IMT, GT is not the market for Matco as consumers are
toward Kellogs
Price Brand conscious (Upper class), Price conscious (Middle class),
Fauji is leader because of price
Ingredient Corn and Wheat, Rice is untapped market with potential (Kellogg's
Failed in Rice), matco should not enter cornflakes market because
of Fauji dominance
Should Go? Yes
Key points: Positive image of Falak in market (Retailers and Consumers), Doctors
are not the influencers, doctors recommend cereal for children because of nutrition
content, consumers don’t want highly processed cereals,
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Chapter 8: FOCUS GROUPS & IN-DEPTH
INTERVIEWS
This chapter outlines the focus groups and in-depth interviews done on the target
segment which included: Employed women, house wives, children, and students (Male
and Female)
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8.1: Summary
A brief background introducing the purpose of the Focus group and what were interested in
finding out from the Focus groups of diverse set of individuals is resented below:
8.2: Focus Groups

The next logical step after conducting Industry analysis, Literature review and primary
research from LMTs is the Focus groups from the customers. Focus groups were conducted
to ascertain explore the mindset of consumers regarding cereals buying behavior. The data
gathered is presented in the appendix which includes the discussion guide as well as the
transcriptions of all the focus groups. Furthermore, thematic analysis of each focus group
upon which findings are based are also attached in the appendix.
8.2.1: Objective
The primary objective of conducting focus groups was to gain firsthand knowledge and
consumer insights about in cereal usage. The major focus was to find out why they bought
cereals and what attributes they search for in the brand of their choice. Focus groups was
semi structured since the emphasis was to have rich discussion with less restrictions around
diverse set of topics. An idea or question was floated and people were asked about their
opinions. They were also encouraged to bring u any new idea they might have. Therefore,
focus groups comprised of more richer discussion than what we had in in-depth interview
where respondent was asked focused questions instead of open discussion.
8.2.2: Analysis of Focus Group – Male Students

8.2.2.1: Objective
The focus group was conducted with the intention of ascertaining the attributes and
characteristics which male students look for in making a purchase decision of cereals. The
focus group revealed some important attributes which were important for them in choosing
Cereals and the process of decision making. Group was also asked to categorize different
brands and their rice range (See Appendix for transcription and thematic analysis)
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8.2.2.2: Mechanism and Dynamics
The focus group was conducted at IBA Boys hostel. The age range of participants was 25-27
years who were studying at IBA and most of them were MBA students. The participants were
single. The participants were first introduced to some ice-breaking questions regarding their
routine and timings of their travelling which eased them and allowed them to open up. The
participants were also treated with some refreshments to keep them engaged and interested
in the discussion.
8.2.2.3: Findings
8.2.2.3.1: Attributes:
People attributed convenience and nutritional value to breakfast cereals. A majority
of the people agreed that cereals provide a much easy to prepare and less time-
consuming alternative to preparing breakfasts. This was especially important as
people have to go to their classes, and hence preferred a ready to eat meal.
While a few users said that they preferred to add something with their cereals, such
as milk or fruit toppings, most of the users said they eat cereals without adding
anything in it. It was also found that corn flakes were preferred by some people,
however, it was not a majority and most of the participant did not express any
preference for a certain type of cereal.
8.2.2.3.2: Social Acceptance:

People did not consider social acceptance to be an important factor when consuming
cereals. While one person mentioned that he chooses cereals which are
recommended by his peers, however it was not to gain social acceptance, but simply
because he was indifferent to any cereal and hence consumed what his friends were
consuming.
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8.2.2.3.3: Brand Experience
All the participants considered brand to be a very important factor when purchasing
cereals. International brands especially Kellogg’s was preferred by the respondents
compared to the local brands due to perception of higher quality.
8.2.2.3.4: Brand Attachment

Most of the participants of the survey were brand loyal. Most of the participants
preferred Fauji cereals, mainly because it is less expensive and more easily available
in the market.
8.2.2.3.5: Purchase Intention

People’s purchase intention was dependent upon the price of cereals, availability in
the market and taste. Product variety was not an important factor since most of them
preferred flavors.
8.2.2.3.6: Usage Pattern

Most of the participants used cereals for breakfasts, however, many of them also
admitted that they also use it in other times of day as a snack as well. Their
consumption pattern was not consistent, with no person consuming it every day.
Most people said that they ate cereals twice or thrice a week.
8.2.2.3.7: Purchase Pattern

Most of the participants said that they prefer to purchase the cereals from LMTs. All
the purchasers were consumers and were the decision makers when purchasing the
cereals, and most of them purchased it monthly as a part of their monthly groceries.
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8.2.3: Analysis of Focus Group – Female Students
8.2.3.1: Objective
The objective of the focus group was to find insights about the consumer perception
regarding Breakfast Cereals. We had conducted primary research with distributors present
the field. Our aim of conducting the focus group was to gain first-hand knowledge about the
preferences and useful insights that might help MATCO in launching cereals in Pakistani
market especially the product features and attributes, price range etc.

The focus group was conducted at IBA girls hostel. The age of the participants ranged from
19 to 25 years. All the participants were living away from home and were independent in the
things they bought. They also expressed their views about their future life and decision
making. This aspect was import because the girls dominantly wanted to enter into
professional careers after completing their graduation and as such would be sending on
groceries. The participants were briefly introduced to the purpose and icebreaking questions
were conducted to make participants feel at ease.
8.2.3.3: Findings
8.2.3.3.1: Attributes:
Attributes like perceived health benefits were discussed. Most people were aware of
the benefits like weight reduction, cholesterol control etc. Other attributes like ease
of consumption were discussed. Most participants agreed that Cereals are not only
easy to make, less time consuming but were also healthy alternative to oily breakfast.
It is therefore easy to digest too.
Cereals were preferred to be consumed with cold milk instead of hot milk. The reason
that was given was that the texture of Cereals is such that they get soggy and lose their
crispiness in hot milk i.e. a cereal’s texture plays a very important role. Moreover,
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most participants were in favor of consuming wheat or corn cereals as compared to
rice cereals.
8.2.3.3.2: Social Acceptance

The Focus group did not reveal significant impact of social acceptance on Cereals
consumption. People were consuming it out of their own motivation and were not doing it
to impress their peers etc.

Brand played a very important role in decision making. People were brand conscious
and sensitive imported brands like Kellogg’s were seen as genuine as compared to
local brands like Fauji. Yet still people were also rice sensitive. They felt Kellogg’s was
not superior because of its product. It is offering the same product i.e. cereal just like
offered by other brands but their advantage was because of the varieties they offered.
They said that they would be willing to try other brands if they offered variety which
meant that people were brand loyal but not to a great extent.
8.2.3.3.4: Satisfaction
It can be inferred from the discussion that people were attached to their own brands
and they were repeat purchases because they were satisfied with the performance of
the product. Few were also satisfied with local brand as it fulfilled their functional
need and it was a better price to value product.
8.2.3.3.5: Loyalty
Most participants were found to be loyal to their brands. However, few also were
open to try new cereal brands. Majority participants were loyal to international
brands. There was no participant who was loyal and had strong association with local
brands. Most participants were loyal to one brand. The reason behind it was the range
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of variants. Other reason for loyalty was that they had grown with their brands and
could attach their memories with them.

The major factors for purchase intension was product variety. Taste because people got fed-up
of just one taste. value for money and ease of storage.
Willingness to Pay
Most participants were price sensitive. They were not willing to pay price premium for their
brands.

Mostly participants were not restrictive in considering cereals as solely a morning
breakfast although they had strong association of cereals with breakfast. One
participant indicated that the packaging of Kellogg’s brand has a rooster which is a
symbol of sunrise and morning. However, they believed that cereals are convenient
to consume so it can be had at any time of the day and not necessarily only in the
morning.

Participants purchased them from nearby superstores of the city. While few bought
them from abroad like one participant from Dubai brought a whole stash of cereals
from abroad. Most of the participants made their own purchase decision because they
were living in the hostels. Purchasers were also the consumers in this case. Cereals
are purchased on monthly bases.
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8.2.4: Analysis of Focus Group – Children
8.2.5.1: Objective
The objective of the focus group was to find insights about the children perception regarding
Breakfast Cereals. We had conducted primary research with distributors present the field.
Our aim of conducting the focus group was to gain first-hand knowledge about the
preferences and useful insights that might help MATCO in launching cereals in Pakistani
market especially the product features and attributes, price range etc.

The focus group was conducted at Anees Hussain academy with the children. All the
participants were living with family. They expressed their views about their breakfast
cereals.
8.2.5.3: Findings
8.2.5.3.1: Attributes
Non-users did not viewed cereals seriously as a proper breakfast alternative, and
identified breakfast cereal attributes as being crunchy and soggy. For users, the
responses were mixed, with some identifying convenience as an important attribute.
Other users said that the cereals are much lighter and easier to consume than a
normal breakfast.
Oats cereals were the most popular choice among students, and only one person
preferred wholegrain. All of the users said that they take their cereals with hot milk.

According to students, social acceptance did not matter much when consuming
cereals. Most of them were using cereals just because of convenience or because of
their taste, but social image was not an important factor for any of them.
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All the participants considered brand to be one of the primary factors to consider
when purchasing cereals. Most of them said that they will prefer foreign brands since
they equate foreign brands with having higher quality.
8.2.5.3.4: Brand Attachment

Regarding brand loyalty the reactions of participants were varied. Some users were
very loyal to a particular brand, while others did not considered brand to be an
important factor, and ate whatever they found in the market when going out for
shopping with their parents. However, even then most of them preferred having a
branded product compared to local.

It was found that students purchase intention was not price, rather they were more
interested in taste or having a branded product. One student in particular emphasized
that he always prefers chocolate flavor variants, regardless of the price.

All of the participants consumed breakfast cereals for breakfast. None of these
students consume cereals apart from breakfast on other time of the day. The
consumption pattern of cereals was also not consistent, as no person consumed it
every day. Majority of the participants said that they consume the cereals twice or
thrice a week.

Most of the participants said that they purchase cereals from big stores. The cereals
were purchased once or twice on a monthly basis along with the monthly groceries.
An average of 2 to 3 boxes were purchased each time to last the entire month without
the need for going again to shop.
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8.2.5: Analysis of Focus Group – Employed Women
8.2.5.1: Objective
This focus group was conducted to find insights about the consumer perception regarding
Breakfast Cereals. After conducting primary research with distributors present the field, our
next step was the focus group to gain firsthand knowledge directly from the end users. The
focus group discussion revealed preferences and useful insights that might help MATCO in
launching cereals in Pakistani market especially the product features and attributes, price
range etc.
The focus group was conducted at one of the houses of working women. The age of the
participants ranged from 25 to 40 years. All the participants were working and were
independent in the things they bought. They also expressed their views about their future
life and decision making. This aspect was import because the women had professional
careers were spending on groceries. The participants were briefly introduced to the purpose
and icebreaking questions were conducted to make participants feel at ease.
8.2.5.3: Findings
8.2.5.3.1: Attributes
Several attributes came under discussion. Participants felt that Cereals were a luxury item
that was a good alternative to regular breakfast involving eggs and parathas. Participants
were not sure if cereals were as nutritious as regular breakfast but most of them agreed that
they were a good alternative to regular breakfast because of convenience. Cereals are not
only easy to make, less time consuming but were also liked by children. It is therefore easy
to digest too. Most participants agreed that cereals should have improved quality with more
variations. Non-users in the focus group believed that cereals were over rated and they
were not as nutritious as consumers were made to believe. They also believed that cereals
are not a good alternate to regular Anda paratha breakfast.
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The non-users pointed out that they could be potential users only if health related benefits
of cereals are highlighted. Also, they might try out if the taste is satisfactory.

The Focus group did not reveal significant impact of social acceptance on Cereals
consumption. People were consuming it out of their own motivation and were not doing it
to impress their peers etc.

Brand played a certain degree of role in decision making. People were brand conscious and
easily recalled imported brands like Kellogs and International brands like Nestle. However,
they kept switching between the foreign brands of Nestle and Kellogs. The reason for it
was greater variety in foreign brands than in local ones like Fauji.
8.2.5.3.4: Satisfaction
It can be inferred from the discussion that people were attached to their own brands and
they were repeat purchases because they were satisfied with the performance of the
product.
8.2.5.3.5: Loyalty
Majority participants were loyal to international brands. This was because of greater variety
foreign brands offered.

Greater variety was cited as the major reason behind purchase intension. Taste became
important because the working women felt that the taste gets blend with long term usage.
Mostly working women preferred Wheat based cereals and also consumed oats. They also
said that alongside taste nutrition value is important. Working women wanted to provide
nutritious and tasty food to their children besides self-consumption. Children were
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influenced by fancy packaging displaying cartoon characters. They held pestering owner
over their moms and moms brought cereals that their kids insisted on.
8.2.5.3.7: Willingness to Pay

Mostly consumers were open to try out new variants and made repeat purchases. In terms
of price vs Brand consciousness, consumers were more brand conscious and willing to pay
higher price for a foreign known brand rather than local brand. Also, consumers might
think of switching if the taste got blend or price became too unreasonable and they did not
have value for money.

Most participants consumed cereals for morning breakfast with some also consuming it as
a light snack in the afternoon. This points to their view of associating cereals with breakfast.
There was a mix pattern in consumption with milk or consuming it solely. Mostly it was
consumed with cold milk.
8.2.5.3.9: Pattern
Purchasers in this focus group were also the end users. They purchased from Grocery shops
as well as super stores like Hyperstar and Imtiaz. It was mostly purchased in large boxes
with consumption pattern of thrice or four times in a week. Cereals are purchased on
monthly bases.
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8.3: IN-DEPTH INTERVIEWS
In-depth interviews were conducted among male student, female student and house wife.
The guide for in-depth interview and all the transcriptions are attached as part of appendix.
8.3.1: Objective
The primary objective of conducting in depth interview was to understand in detail how
consumers buy cereals, what attributes are important to them and why generally cereal is
essential, if it is essential. The important insight that were looked for were why consumers
bought cereals, what factors motivate them to choose a particular brand. More importantly
what did their end value state i.e. what the real intention was and end goal in mind while
consuming cereals.
Gender and occupation-based segregation was done to identify differences in thought

process and purchasing behavior. Laddering technique was used to probe the respondent to
reach his end value state.
8.3.2: Female Student

8.3.2.1: Objective
The major objective of conducting an in-depth interview with a female student was to have
more focused approach. This was the follow on the focus groups where we identified certain
interesting areas that were needed to be explored in detail.

A female student was 24 years was selected and interviewed in the Adamjee block of the
main campus. First, she was introduced to some ice breaking questions regarding her routine
life a travelling habit to build momentum to the discussion and bring her at ease with the
interviewer. Refreshments were also served to keep her interest in the discussion
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8.3.2.3: Findings
When it comes to cereal consumption, Durdana is a regular user of barley cereal for
breakfast. For her convenience is a big factor when it comes to selection of an option of
breakfast. She is already working at a company and she has to wake up and leave early in the
morning for work so she is always looking for convenient breakfast options. Barley is easy
to use and it can be consumed with hot milk directly from the box. She informed that her
colleagues at work also prefer to have cereals due to ease of use.
Nutritional value is also high on Durdana’s priority list. She pays a lot of attention to what a
cereal has to offer in terms of nutrition. Barley cereals available in market these days contain
fruit chunks and nuts in them as well and provide a high nutritional value such as proteins
and carbohydrates and she and her colleagues prefer it because it is light on the system
whereas the traditional breakfast can be high on cholesterol and it tends to slow you down
through the day affecting your performance at work.
Price factor is not as important for her as the quality factor. If a cereal being offered in the
market is of good quality, that is, it has good taste and high nutritional value then she would
not mind paying a premium price for it. She is a working woman and she can afford to pay a
high price as long as she is able to make healthy food choices. She is of the opinion that if she
were to choose a new cereal brand then it would have to be of exceptional quality in order
for her to move to that new brand, no matter what the price is.
She used to be brand conscious while choosing a barley cereal but then her mother, who is
the decision maker in the house when it comes to making purchases, shifted to an unbranded
barley which was better in taste and considered to be free of preservatives and processing.
Since then she is using the unbranded barley but it has to go through an extra cycle of cooking
at home before it can be consumed. So Durdana would rather go for the branded options
available in the market which have gone through all the processes and which can be directly
used out of the box by just adding milk. So, convenience is still a big factor for Durdana.
But she thinks that there are very limited options for adult cereal users like her in the market.
Big brands, according to her, are currently targeting kids with their advertising and they
design their packaging with cartoon characters, to lure kids. This kind of advertising does
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not attract her. Moreover, the product itself is being designed for kids (such as cocopops and
fruity loops). It’s very sugary and adults, who are very conscious about their weight and
health, feel very hesitant while picking up one of those cereals.
Figure 6 Variables from In-depth Interview (Female Student)
Feel Healthy Convenience
Quality
Ease of use Variety

Nutritional Brand
value
Advertising Packaging
8.3.3: Male Student

8.3.3.1: Objective
The major objective of conducting an in-depth interview with a male student was to have
more focused approach. This was the follow on the focus groups where we identified certain
interesting areas that were needed to be explored in detail.

A male student was 31 years was selected. First, he was introduced to some ice breaking
questions regarding her routine life a travelling habit to build momentum to the discussion
and bring her at ease with the interviewer. Refreshments were also served to keep her
interest in the discussion
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8.3.3.3: Findings
Mr. Raheel Qureshi is a consistent user of breakfast cereals especially of oat cereals and
Kellogg’s K Red berries. Being a working man, it is very important for him to reach on his job
in time, hence he does not have time to have his breakfast prepared over a long period of
time and looks for convenient alternatives. Furthermore, he wants his breakfast to be such
which can be eaten as quickly as possible without hassle.
Variant variety is not a big factor for Raheel, as he already has some preferred brands and
variants which he buys. This is also due to the fact that most of his cereal purchases are
decided by his children, who do not care much about brands or variants. Although he said
that when switching for a new brand, one of the factors which will influence his decision is
the availability of variants.
Health consciousness and nutritional value are of secondary importance to Raheel. None of
his family members are particularly health conscious, with the exception of his mother, who
is more health conscious due to her old age. Raheel said that when purchasing cereals, he
does not check the nutritional values written on the packaging of the cereals. When asked
about whether he considers breakfast cereals as having health benefits, he said replied in
negative and said that he does not believe that breakfast cereals are useful in reducing
weights or maintaining blood pressure.
Price sensitivity is an important factor for Raheel. To him convenience and taste of the cereal
are more important, and since he does not associate any health benefits with the breakfast
cereals, hence he does not believe in paying a premium for it. He also said that when
switching for a new brand, price will play a very important role.
Raheel is brand conscious and prefers to consume international brands such as Kellogg’s as
he believes that foreign brands provide good quality products. He also said that packaging
plays a very important role in his choice, since he considers cereals which are easy to store
due to the shape and size of their packaging. However, he revealed that the main factor which
contributes towards his purchase of cereal are his children. Since children are easily
attracted by the colorful images and cartoons on the cereals, hence he has to give in to the
pestering of children even though the packaging might not be easy to store in shelves.
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Figure 7 Variables from In-depth Interview (Male Student)
Value for money
Packaging Affordable Quality
Colorful images Ease of storage Price Brand
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Name Falak Cereal
Target Market Young Adults, Children
Flavor Nutrition Oriented (Preferred Chocolate)
Size 150 grams at initial phase
Place LMT and IMT (Direct Competition KELLOGS)
Price Rs. 165 (Market Competitive)
Ingredient Rice (Whole Grained)
Should Go? Yes
Key points: Marketing properly required in terms of nutrition highlighting, Monthly
purchases, BTL activities
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Chapter 9: CONCEPTUAL FRAMWORK
This chapter outlines the model which we have used for the making of questionnaire.
Here we have highlighted and finalized the variables (constructs) which we will be
using in the research from now onwards.
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9.1: Summary
In the exploratory research phase, we collected primary data. This has given us grounds to
now develop a framework for conclusive research. Insights were gained about consumers
purchasing patterns regarding cereals and what attributes are absolutely essential for them
through in-depth interviews across different occupation and gender. The analysis of focus
groups revealed the major constructs that affect purchase intention of a consumer while
buying cereals.
9.2: Model of Research

Figure 8 Research Model
Consumers’
Confidence
Satisfaction
Brand Purchase Intention

Experience
Loyalty
Product
Attributes
This model focuses on all the factors which are related to our research in terms of identifying
relationship with the purchase intention. All the factors should lead to whether the
customers will be willing to pay for the rice cereal or not. Several questions were asked in
the research to find out what the customers focused at and who are the real customers and
who are the real consumers.
Our model consists of 5 independent variables leading to purchase intention. Consumers’

confidence is related to breakfast and motivation toward the cereal. Brand experience shows
the exposure of target market toward leading market brands and ingredients to what the
customers are familiar with. Product attributes includes all the product related elements
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which the customers keep in mind while purchasing or using the cereal. Consumers’
confidence, brand experience and product attributes all leads to satisfaction of customers
and how much they are loyal to the cause. Loyalty here represents that customers are loyal
to which cereal and whether or not they will switch to new brand. Satisfaction is with the
current brand and features the customers look for in cereals. Purchase intention is function
of loyalty and satisfaction. Foundation for construction of the model and questionnaire was
provided by focus groups and in-depth interviews.
9.3: Conceptualization
9.3.1: Consumers’ Confidence
Confidence of a consumer develops when he/she creates a bond with the product. This bond
develops with time and is dependent on the experience a customer has with the product
itself. This is the positive feeling that results in repeat purchases and leads to loyalty.
Measurement of confidence is from cognitive aspect and emotional dimension. Both play an
important role in decision making as consumers overcome any doubts they have regarding
their own decision-making capacity through them.
9.3.2: Brand Experience

Brand experience is defined in terms of behavioral responses evoked by brand such as
design, logo, packaging, advertising etc as well as internal responses by consumer such as
feelings, emotions etc. Brand experience is not same for every brand; it could be intense and
weak in comparison. Difference could only be of intensity but it could also be of positivity;
i.e. some experience could be more positive than others. Some brand experience last for
longer while some occur on spot and are for shorter duration. These brand experiences are
gathered in memories of consumers and can impact loyalty and satisfaction.
9.3.3: Product Attributes

Here we focus on different dimensions of cereals which leads to a certain image in the mind
of customers. This image is defined as “perceptions about a brand as reflected by the brand
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associations held in the consumer’s memory” (Newman, 1951). These attributes are either
performance related or aspect related hence defining an overall image of the brand.
Most common attributes that came forward through focus groups and in-depth interviews
were Taste, Contents (ingredients) of cereal, Color, Packaging, Originality, Size and Flavor.
First and foremost was the Taste of the cereal about which preferences were different. One
of the most favorite flavor was chocolate. Consumers also complained that the taste of cereal
overtime gets blend and they look for changing it. The second most important thing was the
content of the cereals. Whole grain was seen as beneficial for health so was most desired.
Also, health conscious consumers considered the quantity of sugar present before making a
purchase. Lastly attributes such as size of the pack was important for convenience and
storage. Packaging was essential for attracting consumers especially the children. Imported
brands such as Kellogg’s were seen as having higher quality and originality
9.3.4: Satisfaction
When a product fulfils required expectation in terms of usage and ownership for a consumer
than we have a satisfied customer (Hunt, 1977). Prior beliefs and cost benefit analysis is done
at the time of product purchase and thus satisfaction is related to evaluation on both these
factors. We have a satisfied consumer if the value he received is greater against the price
paid. Satisfaction for certain intangible products like services is difficult to gauge because it
is not measurable right at the time of purchase. Benefits become evident with the passage of
time like consultancy services.
9.3.5: Loyalty
Loyalty in laymen terms is something which customer shows to activities, products, brands,
stores, services etc. We can conceptualize loyalty in three popular ways (Uncles, Dowling, &
Hammond, 2003). First loyalty can be understood as an attitude which helps in developing a
relationship with brand overtime. Second, Loyalty can be understood as a response and
usually this response is in term of purchase. Third, loyalty can be understood in terms of
purchase behavior which is affected by circumstances, characteristics and purchase
situation of consumers (Jacoby & Kyner, 1973).
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9.3.6: Purchase Intention
In layman’s terms, purchase intention is simply inclination of a consumer/customer towards
buying of a product or brand. Purchase intention is dependent on several variables defined
in the conceptual framework such as attributes of product, loyalty, brand experience, and
satisfaction.
9.4: Operationalization
Table 6 Operationalization
Variables Items Reference

Consumer’s 1. I buy this brand because it matches
my requirements
Confidence
2. I buy this brand as it keeps me healthy
3. For me health is very important.
4. Healthy products are preferred by me.
Brand Experience 1. I find this brand interesting (Brakus, Schmitt, &
2. This brand appeals to me Zarantonello, 2009)
Product Attributes 1. Taste is important to me Focus Groups and In-depth
2. Chocolate flavor is important to me
Interviews
3. Cereals crunchiness is important to
me
4. Cereals are good if consumed with hot
milk
5. Cereals are good if consumed with
cold milk
6. Originality of product is important to
me
7. The ingredients of the cereal are
important to me
8. Whole grain is important to me
9. Size of the pack is important to me
10. Logo on the pack is important to me
11. Cartoon character is important to
me
Satisfaction 1. I am satisfied with the current
brand.
2. Product attributes are as per my
requirements.
3. My choice to get this brand has
been a wise one.
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Loyalty 1. If will not switch and I am loyal
to this brand
2. I buy this brand because of the
history I have with this brand.
3. My choice changes only when I
will get dissatisfied.
4. I will recommend this brand to
others
Purchase Intention 1. Likelihood of purchasing this (Dodds, Monroe, & Grewal,
product is very high 1991)
2. Buying new cereal depends on my
overall experience
3. I will buy the new brand
Now we have operationalized the constructs which helps us in developing the questionnaire.
The questionnaire would be used for survey and data collection at primary level. The main
objective of primary data collection is to ascertain why people buy cereals and what factors
affect their decision making. The questionnaire is attached in the appendix.
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Chapter 10: DATA COLLECTION
This chapter outlines the questionnaire, sampling technique and data collection
techniques used for the collection of data. Data collection took around a month and
was collected twice to get the meaningful data.
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10.1: Summary
This chapter entails the initial data collection through the questionnaire created via
conceptual framework model. Questionnaire can be referenced in Appendix M. Data
collection took about a month to get the meaning data which could lead our research toward
a conclusion with direction-oriented result.
10.2: Questionnaire
10.2.1: Structure
Questionnaire was created in line with the conceptual framework, in-depth interviews and
focus groups. Questionnaire has five parts divided as:
Figure 9 Questionnaire Structure

Part 1: Customer Demographics 5 questions
Part 2: Breakfast and Cereals 17 questions
Part 3: Attributes and Variables 17 questions
Part 4: New Product Launch 18 questions
Part 5: About Matco Foods 5 questions
Most of the questions were Likert base questions to get the information from the data about
the attributes and new product. Rest of the questions were information and views based as
per the requirements of Matco food.
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10.2.2: Sample Size
10.2.2.1: Sample size variables
Before you can calculate a sample size, you need to determine a few things about the target
population and the sample you need:
10.2.2.1.1: Population Size How many total people fit your demographic? Not all
populations sizes need to be this large. Even if your population size is small, the key
thing here is to just know who fits into your demographics. It is common for the
population to be unknown or approximated between two educated guesses.
10.2.2.1.2: Margin of Error No sample can be perfect, it’s important to decide how
much error to allow. The confidence interval determines how much higher or lower
than the population mean you are willing to let your sample mean fall. Here a margin
of error taken is of +/- 7.5%. We collected data in twice, for the first collection, we
used 5%, but due to lack of replies and users of cereal we increased it to 7.5%.
10.2.2.1.3: Confidence Level How confident do you want to be that the actual mean
falls within your confidence interval? The most common confidence intervals are
90% confident, 95% confident, and 99% confident. Here we are choosing a 95%
confidence interval based on previous researches and guiding principles.
10.2.2.1.4: Standard of Deviation How much variance do you expect in your

responses? Since we haven’t actually administered our survey yet, the safe decision
is to use .5 – this is the most forgiving number and ensures that your sample will be
large enough.
10.2.3: Calculating sample size

As we have defined the variables for sample size calculations, now we will use the following
formula to derive our sample size.
Necessary Sample Size = (Z-score)2 * Std Dev*(1-StdDev) / (margin of error)2
1. Now calculating each value:
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2. Z- Score = 95% – Z Score = 1.96
3. Std Dev = 0.5
4. Margin of Error = 0.075
Now calculating it using the formula
= ((1.96)2 x .5(.5)) / (.075)2

= (3.8416 x .25) / 0.005625
= (0.9604 /0.005625)
= 170.7 = 171
For our research to give a meaningful data, number of respondents should have been greater than
171.
10.3: Data Collection

10.3.1: Basic Variables
The questionnaire was filled by 226 respondents with data collected over one month.
Initially the questions were asked from over 616 respondents but more than turned out to
be non-users of cereal and their responses were limited. Out of those 616, 226 answered and
provided their feedback related to cereal usage, buying pattern and attributes important to
them. Basic information of the respondents is given below:
Table 7 Basic Information of respondents
VARIABLES MALE FEMALE TOTAL

PARTICIPANTS 404 212 616
NO 298 92 390
YES 106 120 226
Age 21-30 96 93 189
Age 31-40 1 14 15
Age 41-50 0 3 3
Age 50 ABOVE 9 10 19
As per our calculations it took around 15 to 20 minutes to fill the questionnaire.
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Figure 10 Basic Information of respondents
PARTICIPANTS
390
298
106 120 226 92
YES NO
MALE FEMALE TOTAL
Figure 11 Cereal Users
CEREAL USERS
Male
47%
53% Female
Figure 12 Age Group
AGE GROUPS
AGE 50 ABOVE 10
9
AGE 41-50 3
0
AGE 31-40 14
1
AGE 21-30 93
96
0 20 40 60 80 100 120
Female Male
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Based on the initial collected variables, females use cereals more than males. Age group 21-
30 dominated our research with male having the higher number. Females are 94, and Males
are 97.
10.3.2: Household Income

Based on the household income level, following is the division:
Table 8 Household income
Income 50 BELOW 39
Income 50-150 133
Income 151-250 20
Income 250-250 19
Income 350+ 15
Figure 13 Household income
Household Income
7%
17%
8%
Income 50 BELOW
9% Income 50-150
Income 151-250
Income 250-250
Income 350+
59%
Table 8 shows that the main group was the income between 50K to 150K. We had a
preconception that the higher income groups will be the main users of cereal. But as
per data collection, this hypothesis is not true. Females are 66 and Males are 69.
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10.3.3: Occupation
Table 9 Occupation
Employed 77
Housewives 27
Self employed 19
Student 103
Figure 14 Occupation
Occupation
34% Employed
46% Housewives
Self employed
Student
12%
8%
Table 9 shows that the main group of cereal users is of students. Here female students are
58 and male are 45.
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10.3.4: Occupation
Table 10 Location
Bath Island 1 Jahangir Road 3

Clifton 11 Jamal 1
Iqbal 56 Johor 25
Islamabad 7 Karsaz 7
Karachi 36 Maymar 7
Lahore 6 Nauman Heights 1
Defense 32 Nazimabad 17
FB Area 9 PECHS 6
Shadman 1
Figure 15 Location
Location
Bath Island Clifton Iqbal Islamabad Karachi

Lahore Defense FB Area Jahangir Road Jamal
Johor Karsaz Maymar Nauman Heights Nazimabad
PECHS Shadman
Here some of the participants didn’t mentioned the location name. They were 36 in number.
From the rest dominated location is Iqbal, Defense, Johar and Nazimabad.
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Gender Primary Females, Secondary Males

Income group 50 to 150
Occupation Students, Employed
Location in Karachi Gulshan-e-Iqbal, Defense, Gulistan-e-Johar, and Nazimabad
As per our research done so far, Main target market is of students and secondary market is of
children. There was close competition between the numbers of males and females. If we look at
the bigger picture than females number was greater than males. But due to close competition
between both groups we conclude that main target market should include both males and
females.
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Chapter 11: DATA ANALYSIS
(Part 1)
This chapter outlines the techniques used for the analysis of data collected in Chapter
10. Here we used graphs, tables, and charts to analyze the data along with the use of
SPSS to get meaning form the data. Data analysis also took around the same length as
of data collection.
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11.1: Summary
This chapter entails the initial findings from the data collected through the questionnaire
and discussed in the previous chapter. The questionnaire was filled by 226 respondents with
data collected over one month. Initially the questions were asked from over 600 respondents
but more than turned out to be non-users of cereal and their responses were limited. Out of
those 600, 226 answered and provided their feedback related to cereal usage, buying pattern
and attributes important to them. Here in the first section we discuss the important
questions related to breakfast and cereals, later in the next chapter we use SPSS to check the
data relationship and also prove different hypothesis related to our research.
11.2: Variables Related to Breakfast Cereal

11.2.1: Breakfast
11.2.1.2: Timing
Here we start with asking the basic question of the importance of breakfast for consumers.
Its our hypothesis that if one focuses on the breakfast and recognizes the importance of it,
then he/she will also focus on the content, ingredient and nutrition element of the breakfast
as well.
Table 11 Breakfast Timing
Regularly 122
Sometimes Miss 91
Don’t Eat It 13
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Figure 16 Breakfast Timing
Breakfast Timing
6%
Regularly
40% Sometimes Miss

54%
Don’t Eat It
54% of our respondents believe that breakfast is an important meal of the day and it should
be properly arranged for as whole day progress depends on the breakfast itself. Our
hypothesis here is correct.
11.2.1.2: Cereal User Level

Table 12 User Level
Very Low Low Normal Strong Heavy

25 65 64 33 39
Figure 17 User Level
User Level
17% 11%
Very Low
Low
15% 29% Normal
Strong
Heavy
28%
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Here we can see that the user level ranges between the normal and strong level. User
consider themselves constant users of cereal. But how often they consume cereal. Let’s check
in the next question
11.2.1.3: Consumption Pattern

Table 13 Cereal Consumption Pattern
Daily No specific Once a week Twice a week

pattern
39 55 59 73
Figure 18 Cereal Consumption Pattern
Cereal Consumption Pattern
17%
Daily
32%
No specific pattern
25% Once a week

Twice a week
26%
Here in accordance with the previous question we can say that consumers users are mostly
weekly and bi weekly users. Hardcore users are 17% and consumer with mixed feelings are
25%.
11.2.1.4: Cereal Eating Pattern

During our initial phases of research many respondents also showed patterns of usage of
cereal as a snack. So, we asked our respondents to tell us their views about the eating pattern
of cereal.
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Table 14 Cereal Eating Pattern
As a snack only Both For breakfast

only
108 27 91
Here we conclude that cereal is also used as a snack not just as a breakfast accessory only.
This gives rise to a new segment of customers which also prefer cereal as a snack.
11.2.2: Ingredient
Table 15 What is your preferred ingredient?
Ingredient Least Less Neutral Preferred Most

preferred preferred preferred
Wheat 29 4 50 74 69
Corn 0 13 17 158 38
Oats 37 90 99 0 0
Rice 12 29 181 4 0
Here we can see that the most preferred ingredient is wheat, followed by a majority of
consumers favoring corn. Loyal users are of wheat, constant users are of corn. Oats comes in
3rd place with rice mostly neutral.
With this question we also wanted to check the response of consumers toward rice cereal.
Here we can see that 181 out of 226 marked neutral response because of very limited
encounter with breakfast cereal.
11.2.3: Cereal Preferences

11.2.3.1: Cereal Preference (Location)
Here you can see that around 61% users prefer that international brands but 39% also
focuses on the local brand. Authencity of this claim will be tested on loyalty level whether
consumers will still remain on international or can be switched to our new local brand.
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Figure 19 Cereal Preference
Cereal Preference
39% Local
Internation
61%
11.2.3.2: Cereal Preference (International Cereal Location)

As of now we know customers are preferring international brands but from where. This
question answer that.
Table 16 Buy breakfast cereal from?
Big Stores Local Shops
172 35
It’s clear to us now that the users are more toward big store for the buying of cereal. So, if a
new brand is launched, selling point should be the big stores.
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11.2.3.3: Cereal Preference (Location Names)
Figure 20 Store Names
Store Names
43
22
91
OUT OF 226
25
14
0 10 20 30 40 50 60 70 80 90 100
Not Mentioned Naheed Metro Imtiaz Hyperstar Greenvalley Chase Aghas
Here we see that Imtiaz is the number one preference of buyers followed by Hyper star and
Naheed. 43 of the users didn’t mentioned the store names.
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11.2.3.4: Cereal Preference (Variable)
Figure 21 Important cereal attribute
Cereal Preference (Variable)
16%
27%
Convenience
Ingredient
Name
Nutrition Value
33% Price
16%
8%
On the basis of the following information, nutrition value and convenience are more
important for the users. Name is their least concern; cereal nutrition aspect and convenience
should be the highlighted factor.
11.2.4: Purchase Planning

11.2.4.1: User Planning
Here we ask our respondents about the purchasing of cereal, i.e. how its purchased at their
homes. We divided in into 5 groups:
1. Focused Purchase: Buys him/her self with plan of which cereal to buy and cereal
is purchased only.
2. No Input: Cereal is purchased by some else for home and user has no input on
which cereal to be purchased.
3. Planned Purchase: Cereal is purchased by user for home as a part of monthly
purchases.
4. Unplanned Purchase: Cereal is purchased by user for home as a part of monthly
purchases but purchased randomly without any plan.
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5. Yes Input: Cereal is purchased by some else for home but user do provide input
on which cereal to be purchased.
Table 17 Purchase Planning
Focused No Input Planned Unplanned Yes Input

Purchase purchase purchase
25 14 58 97 32
Here we see that the purchases are mostly unplanned followed by planned. Key thing here is
that the users prefer to buy cereal as a part of monthly groceries.
11.2.4.2: Purchase Pattern

To know more in detail, we asked our respondents to tell us pattern of purchase either on
monthly or on need base.
Table 18 Purchase Pattern
Monthly basis Need Basis
121 105
Now it becomes clearer that the users mostly purchase on monthly basis but can also buy if
cereal package is finished before month end. This means users gives importance to the
cereal.
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11.2.5: Preferred Brand
Figure 22 Brand Preferred
Preferred Brand
3%
19%
Fauji
27%
Kellogs
Nestle
Oats
51%
Here we asked respondents that which brand they currently use. As per results, Kellogg’s
followed by Nestle is the preferred choice. This shows consistency with previous data the
customers prefer International brands.
11.2.6: Household Users

11.2.6.1: Household
Here we wanted to know who the users at home are. We go the following results:
Table 19 Users of cereal in your household
Number 1: Myself, Children below 10, younger sister, younger brother
Number 2: Elders sister, elder brother
Number 3: Mother, father
Number 4: Other relatives
Primary users at the household are children and young brother and sisters. This means
cereal is more popular in youngsters.
11.2.6.2: Cereal Association

We asked respondent to confirm or deny the hypothesis that whether the breakfast is
associated with children or adults only.
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Figure 23 Breakfast cereal associated with
Cereal Association
38% Adult
49% Children
Both
13%
Here we conclude that users think that cereals are mainly for adults but in almost near same
proportion users think that it’s for both as well. For children, obtained result is very low and
this may be because of very limited responses from children.
11.2.7: Packaging
11.2.7.1: Focus
This question arises in accordance with the results gathered from previous research where
we concluded that packaging is the most important factor in sales of cereal. Here we put that
to the test.
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Figure 24 Cereal Packaging
Cereal Packaging
4%
15%
Back Side
Color
38% 15%
Front Side
Ingredient
Price
28%
From the result we clearly see that two factors are important for users i.e. front side and
ingredient. For successful sales of cereal, ingredient and front side designing is what the
customers will focus on.
11.2.7.2: Information
Here we wanted to know which information on the packaging is important for the users
Table 20 Packaging information
Number 1: Ingredient, Information, Nutritional Value
Number 2: Flavor
Number 3: Ease of use, colors
As per previous results, users look for ingredient, useful information and nutrition value for
making decisions of cereals.
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11.2.8: Opinions
Here we wanted to know how we can persuade the customer to buy our product.
Table 21 Opinions
Opinion Strongly Disagree Neutral Agree Strongly

Disagree Agree
Own 0 0 30 163 33
FNF 26 40 51 109 0
Sales 30 64 68 58 6
Person
Adv 16 30 26 112 42
Discounts 43 17 39 80 47
Here we conclude that users prefer their own opinion about the first. This opinion can be
made through advertisement, friends and family.
11.2.9: Product Attributes

Table 22 Product Attribute
Attribute Strongly Disagree Neutral Agree Strongly

Disagree Agree
Taste 5 1 34 91 96
Ease of Usage 0 0 6 74 146
Volume 0 0 18 105 103
Color 9 21 67 73 56
Packaging
Color Cereal 0 24 32 70 100
Crunchy 19 17 47 67 76
Soggy 1 23 14 75 113
Overall 4 12 27 109 74
Appearance
Here we wanted to check the opinions of users about the product attributes. We can see that
ease of usage is very important for the users. For the rest, users’ opinions were in between
middle. However, they do look for overall appearance of cereal.
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11.2.10: Tasting
Here we ask our users to know if there appears an opportunity of tasting and then buying
the product, then how much users are interested in it:
Table 23 Taste Testing
Preference Strongly Disagree Neutral Agree Strongly

Disagree Agree
Taste than 56 29 67 51 23
buy
Here we receive mix opinions they some are disagreeing and some are agreeing. This means
tasting is not an overall useful technique but if done it can change customers perceptions too.
11.2.11: Loyalty
Here we check the loyalty of the cereal users whether they are willing to try new cereals or
not:
Figure 25 Loyalty
Loyalty
14% 13%
Not Switch
15% On experience
25% Will try

Will try Int
Will try local
33%
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Here it’s clear that loyalist is only 13%. Rest can switch to a new brand depending on the
condition. Here we see close competition between going for a local or international at just
15% and 14%.
11.2.12: Reason to Switch

As know we know 87% users were willing to switch we wanted to check if users switch what
will be the reason of this:
Table 24 Reason to switch
Number 1: Ingredient
Number 2: Word of mouth
Number 3: Advertisement, Price, Name
It’s surprising to see that the switch reason customer presents are ingredient so if a new
ingredient is presented to customers and if they like it they are willing to switch.
11.2.13: Current Purchasing

11.2.13.1: Monthly Price
Table 25 Monthly Price
Price Count
1500 - 3000 16
500 - 1500 87
Less than 500 123
Users spends less than 500 on the cereal in a month. There are also some users who spends
around 500 – 1500 rupees.
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11.2.13.2: Price per box
Table 26 Price per box
Price Count
100 - 200 13
201 - 300 47
301 - 400 60
401 - 500 77
500 and 29
above
Users purchases between 301 to 500 rupees. This confirm the purchases done between 500
to 1500 rupees per month.
11.2.13.3: Size of box

Table 27 Size of Box
Size Count
1 kg 11
100 gm 3
150 gm 32
250 gm 72
500 gm 108
Here we wanted to know the size of the boxes purchased by the users. Users mostly choose
half KG packs followed by 250grams.
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11.2.14: Rice Cereal
11.2.14.1: Rice cereal using
Figure 26 Ever used rice cereal
Rice Cereal Used
35%
No
Yes
65%
Here we wanted to know whether users have ever used rice cereal or not. Surprisingly, 35%
users have used rice cereal before.
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11.2.14.2: Rice cereal status
Figure 27 Rice Cereal Status
Status
44% No
56% Yes
If the customers have used rice cereal before, we wanted to know if they are currently using
it or not. Out of the 35% who said they have rice cereal said they occasionally try rice cereal.
44 out of 226 still try rice cereals.
11.2.14.3: Rice cereal reason

Figure 28 Rice Cereal Reason
Reason
10%
19%
Better Competitor products

Lack of info
21%
Marketing
50%
Taste
Here we wanted to know why the rice cereal is not popular among the users anymore. Users
said that lack of info about rice cereal is the main reason they quit or ever used rice cereal.
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11.2.15: Blind Testing
Here we wanted to check the confidence of users whether they will be able to distinguish the
taste of their cereal in a blind test. 58& users are confident that they will be able to identify.
We will put that into a test in Chapter 13.
Figure 29 Blind Testing
Blind Testing
42%
No
Yes
58%
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11.2.16: New Cereal highlight.
11.2.16.1: Highlight
We wanted to know if the customers are willing to switch, which information they will notice
in the new product.
Figure 30 New Product Highlight
Highlight of new product
16% 15%
Nutritional value
4% Nutritional value, Price, Taste
2%
Nutritional value, Taste
Price
33% Price, Taste

Taste
30%
Here we see that nutrition value is the highlighted value in all the results.
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11.2.16.2: Feature
Table 28 New Product Features
Features Strongly Disagree Neutral Agree Strongly

Disagree Agree
New Name 0 21 57 81 67
Old Name 0 38 65 75 48
Price Equal 5 15 72 82 52
Price Less 0 9 44 109 64
Price High 40 49 78 34 25
Different 2 8 55 78 83
Variants
Flavor for 9 3 22 81 111
Children
Nutrition for 0 6 28 98 94
Adults
Here we wanted to get concrete information from the users by confusing them a little and by
also asking all the expected answers. New name, Price equal or less than competition, and
different variants are preferred by users.
We again tried to check association of children and adults with the most known attributes
i.e. flavor for children is important and nutrition is important for adults. We tested these two
hypotheses and confirm that both hypothesis is true.
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11.2.16.3: Flavor
Figure 31 Flavor
Flavor
7%
12%
Chocolate
2%
Corn
Rice
Oats
59%
20% Wheat
We wanted to know the preferred flavor of cereal so with no doubt users preferred chocolate
flavor among all. Something to notice here is that rice is still at 2%.
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11.2.16: Matco Foods.
11.2.17.1: Knowledge of Matco Foods
We wanted to know how much users know about Matco foods. 35% customers know about
Matco foods.
Figure 32 Matco Food Knowledge
Matco
35%
No
Yes
65%
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11.2.17.2: Knowledge of Falak
We wanted to know how much users know about Falak. 80% customers know about Falak
brand. This means Falak is a popular brand among the users.
Figure 33 Knowledge of Falak
Falak
20%
No
Yes
80%
11.2.17.3: Falak as a brand

Here we wanted to know how the users rate the Falak brand.
Table 29 Falak As a Brand
Features Worst Bad Normal Good Best

Quality 0 24 93 83 26
Price 0 7 60 159 0
Packaging 0 32 122 64 8
Quality wise users ranged between normal and good, price wise customers are happy and
rated as good, and about packaging customers mostly rated normal
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Breakfast Regular, Normal to Strong User Level, Weekly to Biweekly Use,
Cereal is also used as a snack
Ingredient Loyal: Wheat, Consistent: Corn, Unbiased about Rice. Corn is the
preferred choice of users.
Preferences International brands, Nutritional Value, Convenience
Store Names Imtiaz, Hyper star, Naheed
Purchase Planning Mostly Unplanned followed by planned. Cereal is purchased as a
part of monthly groceries. Cereal is an important part of breakfast to
some users.
Brand Preferred Kellogg, Nestle
Cereal Associated Youngsters are here the main users, Cereal is not just for adults or
With children
Packaging Front Side, Ingredient, Information, Nutritional Value, Overall
Appearance
Opinions Advertisement, Friends and Family
Loyalty 87% users can switch to a new brand
Reason to Switch Ingredient
Current Purchasing Monthly purchasing, Rs. 500-1500 spend monthly on cereals,
price of box is between 300 to 500 rupees and preferred size of
box is 500grams followed by 250 grams.
Rice Cereal 35% Users have tried rice cereal, lack of info is the main reason
why rice cereal doesn’t succeed.
Blind Test 58% Users are confident they can identify their current cereal
New Product Features New name, Price equal or less than competition, and different
variants are preferred by users
Associations Flavor with children and nutrition with adults
Flavor Chocolate
Matco. 35% knows Matco, 80% knows Falak
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Chapter 12: DATA ANALYSIS
(Part 2)
This chapter outlines the techniques used for the analysis of data collected in Chapter
10. Here we used graphs, tables, and charts to analyze the data along with the use of
SPSS to get meaning form the data. Data analysis also took around the same length as
of data collection.
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12.1: Summary
This chapter entails the initial findings from the data collected through the questionnaire
and discussed in the previous chapter. The questionnaire was filled by 226 respondents with
data collected over one month. Initially the questions were asked from over 600 respondents
but more than turned out to be non-users of cereal and their responses were limited. Out of
those 600, 226 answered and provided their feedback related to cereal usage, buying pattern
and attributes important to them. Here in this chapter we use SPSS to check the data
relationship and also prove different hypothesis related to our research.
12.2: SPSS Analysis

After analysis of 3 parts of questionnaire we move toward the SPSS analysis where the data
was put through statistical analysis to perform various tests like dimension reduction,
reliability, and factor analysis.
12.2.1: Factor Analysis and Reliability Test

We did factor analysis to check all the variables to know to check the relationships and
authencity of the data that how much the results we will get is as per requirements.
We only selected factors with one component because it’s the requirement of the research
to have variables/factors with one component. Results are shown in the Table 30. Where
there was issue with the components, we used dimension reduction to reduce to one
component. Items which were showing low results were removed. For reliability, each factor
had a Cronbach’s Alpha between 0.6 and 0.7.
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Each of the 7 variables with summarized results are as follows:
Table 30 Factor and Reliability Tests
KMO CBA Bartlett

Variable Items Extracted Interpretation
Value Value Test
BE1 sig-value > 0.05, therefore we
Experience 0.5 1 - 0.978
BE2 accept null hypothesis
E2
sig-value < 0.05, therefore we
Confidence 0.537 E3 1 0.6 0.000
reject null hypothesis
E5
A2
A3 sig-value < 0.05, therefore we
Attributes 0.543 1 0.4 0.000
A7 reject null hypothesis
A8
S1 sig-value > 0.05, therefore we
Satisfaction 0.5 1 - 0.816
S2 accept null hypothesis
L1
Loyalty 0.495 L2 1 0.7 0.000
L4
I1
Intention 0.626 I4 1 0.6 0.000
I6
Interpretation: When factor analysis was done on the variables, extracted

components were either 2 or more than 2, so dimension reduction was done to get
decent value for tests. Cronbach for the items were between 0.6 and 0.7 and below
than that were excluded from the further research.
Figure 34 Final Model
Customer
Confidence
Loyalty Purchase Intention
Product
Attributes
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12.2.2: Bartlett’s Test of Sphericity
The null and alternate hypothesis are:
Ho: Sample size of the data is not adequate and not reliable for factor and reliability test.
H1: Sample size of the data is adequate and reliable for factor and reliability test.
Interpretation: On analyzing the results of the test, it can be concluded that 4 out of
6 variables has less than 0.5 sig value in Bartlett’s test therefore, for the four
remaining variables we reject null hypothesis and accept alternate hypothesis.
12.2.3: Hypothesis Testing

After the preliminary tests, 18 hypotheses were made and checked through Correlation,
Regression, Independent T test and One-way ANOVA.
The following continuous and categorical variables were used.
12.2.3.1: Continuous Variables

From different questions pertaining to a construct, a total variable was computed which was
further used in the analysis part.
1) Brand Experience
2) Product Attributes
3) Customer Confidence
4) Loyalty
5) Purchase Intention
6) Customer Satisfaction
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12.2.3.2: Categorical Variables
Following are the categorical variables used in the testing against the continuous variables
1) Gender
2) Age Level
3) Occupation
4) Income Level
12.2.4: Correlation Testing:

Following are the hypothesis of correlation
H1: There is no linear relationship between age and total intention.
Interpretation: The relationship between age and total intention was investigated
using Pearson correlation coefficient. There was very weak negative correlation
between the two variables [r=-.009, n=226, p>.05]. Therefore, we accept the null
hypothesis.
H2: There is no linear relationship between gender and total intention.
Interpretation: The relationship between age and total intension was investigated
using Pearson correlation coefficient. There was very weak positive correlation
between the two variables [r=.062, n=226, p>.05]. Therefore, we accept the null
hypothesis.
H3: There is no linear relationship between occupation and total intention.
Interpretation: The relationship between age and purchase intension was

investigated using Pearson correlation coefficient. There was weak negative
correlation between the two variables [r=-.172, n=226, p<.05]. Therefore, we reject
the null hypothesis.
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H4: There is no linear relationship between income and total intention.
Interpretation: The relationship between age and total intention was investigated
using Pearson correlation coefficient. There was weak negative correlation between
the two variables [r=-.208, n=226, p<.05]. Therefore, we reject the null hypothesis.
H5: There is no linear relationship between age and total loyalty.
Interpretation: The relationship between age and purchase intension was

investigated using Pearson correlation coefficient. There was very weak negative
correlation between the two variables [r=-.005, n=226, p>.05]. Therefore, we accept
the null hypothesis.
H6: There is no linear relationship between gender and total loyalty.
Interpretation: The relationship between age and total loyalty was investigated
using Pearson correlation coefficient. There was weak positive correlation between
the two variables [r=.209, n=226, p<.05]. Therefore, we reject the null hypothesis.
H7: There is no linear relationship between occupation and total loyalty.
using Pearson correlation coefficient. There was very weak positive correlation
between the two variables [r=.032, n=226, p>.05]. Therefore, we accept the null
hypothesis.
H8: There is no linear relationship between income and total loyalty.
using Pearson correlation coefficient. There was weak positive correlation between
the two variables [r=.148 n=226, p<.05]. Therefore, we reject the null hypothesis.
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12.2.5: Regression Testing
Following are the hypothesis of regression
H9: There is no influence of loyalty and satisfaction on intention.
Table 31 Loyalty, Satisfaction on Intention (Regression)
Model Summary
Adjusted R Std. Error of the

Model R R Square Square Estimate
1 .425a .181 .174 .90901150
ANOVAa
Model Sum of Squares df Mean Square F Sig.
1 Regression 40.735 2 20.367 24.649 .000b
Residual 184.265 223 .826
Total 225.000 225
Coefficientsa
Standardized
Unstandardized Coefficients Coefficients
Model B Std. Error Beta t Sig.
1 (Constant) 3.148E-16 .060 .000 1.000
REGR factor score:

.258 .062 .258 4.177 .000
Total_Loyalty
REGR factor score:

.392 .062 .392 6.341 .000
Total_Satisfaction
a. Dependent Variable: REGR factor score: Total_Intention
Interpretation: Multiple linear regression analysis was used to develop a model for
predicting influences of total loyalty and total satisfaction on total intention. The two
predictors account for 42.5% of the variance in total intention, F = 24.649, p<.05,
R2=.274. All predictors were not statistically significant with b0 = 3.148E-16, p>.05.
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H9: There is no influence of loyalty on intention.
Table 32 Loyalty on Intention (Regression)
Model Summary

1 .183a .033 .029 .98535706
ANOVAa
1 Regression 7.512 1 7.512 7.737 .006b
Residual 217.488 224 .971
Total 225.000 225
Coefficientsa
Standardized
1 (Constant) 1.670E-16 .066 .000 1.000
REGR factor score:

.183 .066 .183 2.782 .006
Total_Loyalty
a. Dependent Variable: REGR factor score: Total_Intention
Interpretation: Linear regression analysis was used to develop a model for

predicting influence of total loyalty on total intention. The predictor account for
18.3% of the variance in total intention, F = 7.7, p<.05, R2=.033. Predictor was not
statistically significant with b0 = 1.670E-16, p>.05.
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H10: There is no influence of attribute and confidence on loyalty.
Table 33 Attribute, Confidence on Loyalty (Regression)
Model Summary

1 .044a .002 -.007 1.003480
ANOVAa
1 Regression .445 2 .223 .221 .802b
Residual 224.555 223 1.007
Total 225.000 225
Coefficientsa
Standardized
1 (Constant) 1.992E-16 .067 .000 1.000
REGR factor score: Total

.015 .068 .015 .216 .829
_Confidence
REGR factor score: Total

.040 .068 .040 .584 .560
_Attribute
a. Dependent Variable: REGR factor score: Total_Loyalty
Interpretation: Multiple linear regression analysis was used to develop a model for
predicting influence of attribute and confidence on total loyalty. The predictor
account for 0.4% of the variance in total intention, F = .221, p>.05, R2=.002. Predictors
were not statistically significant with b0 = 1.992E-16, p>.05.
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12.2.6: Independent Testing:
Following are the hypothesis of regression
H11: There is no difference among mean scores of total loyalties on gender.
Table 34 Loyalty on Gender (Independent T test)
Group Statistics
2. Gender? N Mean Std. Deviation Std. Error Mean
Total_Loyalty Male 106 10.00943 2.376453 .230822
Female 120 10.79167 1.694756 .154709
Independent Samples Test
Levene's Test
for Equality of
Variances t-test for Equality of Means
95% Confidence
Sig. Interval of the
(2- Mean Std. Error Difference
F Sig. t df tailed) Difference Difference Lower Upper
Total_Loyalty Equal
-
variances 18.142 .000 224 .004 -.782233 .272296 -1.318823 -.245642
2.873
assumed
Equal
variances -
187.197 .005 -.782233 .277873 -1.330398 -.234067
not 2.815
assumed
Interpretation: An independent-samples t-test was conducted to compare the

loyalty scores for males and females. There was no significant difference in scores for
males (M=10, SD=2.3) and females [M=10.7, SD=1.69; t (226) =2.873, p=.004]. since
P value was less than .05 level the result was significant.
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H12: There is no difference between mean scores of total intentions on gender.
Table 35 Intention on Gender (Independent T test)
Group Statistics
2. Gender? N Mean Std. Deviation Std. Error Mean
Total_Intention Male 106 11.79245 2.059667 .200053
Female 120 11.98333 1.833321 .167359
Independent Samples Test
Levene's
Test for
Equality of
Variances t-test for Equality of Means
95% Confidence
Sig. Interval of the
(2- Mean Std. Error Difference
F Sig. t df tailed) Difference Difference Lower Upper
Total_Intention Equal
-
variances .459 .499 224 .462 -.190881 .258951 -.701173 .319412
.737
assumed
Equal
variances -
211.844 .465 -.190881 .260825 -.705026 .323265
not .732
assumed
Interpretation: An independent-samples t-test was conducted to compare the

intention scores for males and females. There was no significant difference in scores
for males (M=11.79, SD=2.05) and females [M=11.98, SD=1.88; t (226) =0.737,
p=.462]. since P value was greater than .05 level the result was not significant.
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12.2.7: Annova Testing
H13: There is no difference among mean scores of total intentions on age group.
Interpretation: A one-way ANOVA was conducted to explore the impact of age on

total intention. Subjects were divided into five groups according to their ages (Group
1: 10 to 20; Group 2: 21 to 30; Group 3: 31 to 40; Group 4: 41 to 50; Group 5: 50
onwards). There was no statistically significant difference as p>.05 level in total
intention scores for the five age groups [F (226) = 0.979, p=.404]. Therefore, we fail
to accept the null hypothesis.
H14: There is no difference among mean scores of total loyalty on age group.
Interpretation: A one-way ANOVA was conducted to explore the impact of age on

total loyalty. Subjects were divided into five groups according to their ages (Group 1:
10 to 20; Group 2: 21 to 30; Group 3: 31 to 40; Group 4: 41 to 50; Group 5: 50
onwards). There was no statistically significant difference as p>.05 level in total
loyalty scores for the five age groups [F (226) = 2.48, p=.062]. Therefore, we fail to
accept the null hypothesis.
Table 36 Intention, Loyalty on Age ( Annova)
ANOVA
Sum of Squares df Mean Square F Sig.
Total_Loyalty Between Groups 31.457 3 10.486 2.482 .062
Within Groups 937.764 222 4.224
Total 969.221 225

Total_Intention Between Groups 11.060 3 3.687 .979 .404
Within Groups 836.391 222 3.768
Total 847.451 225
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Multiple Comparisons
Tamhane
95% Confidence
Interval
Dependent (I) 1. What is (J) 1. What is Mean Std. Lower Upper

Variable your age? your age? Difference (I-J) Error Sig. Bound Bound
Total_Loyalty 21-30 31-40 -.603175 .383671 .572 -1.72418 .51783
41-50 -2.603175* .152951 .000 -3.00988 -2.19647
50 onwards .554720 .508774 .869 -.91702 2.02646
31-40 21-30 .603175 .383671 .572 -.51783 1.72418
41-50 -2.000000* .351866 .000 -3.07603 -.92397
50 onwards 1.157895 .599389 .321 -.52651 2.84230
41-50 21-30 2.603175* .152951 .000 2.19647 3.00988
31-40 2.000000* .351866 .000 .92397 3.07603
50 onwards 3.157895* .485239 .000 1.72502 4.59077
50 onwards 21-30 -.554720 .508774 .869 -2.02646 .91702
31-40 -1.157895 .599389 .321 -2.84230 .52651
41-50 -3.157895* .485239 .000 -4.59077 -1.72502

Total_Intention 21-30 31-40 .238095 .533223 .998 -1.35662 1.83281
41-50 -1.761905 .363243 .110 -4.16453 .64072
50 onwards .220551 .371620 .993 -.84116 1.28226
31-40 21-30 -.238095 .533223 .998 -1.83281 1.35662
41-50 -2.000000* .612048 .037 -3.90520 -.09480
50 onwards -.017544 .617057 1.000 -1.77783 1.74275
41-50 21-30 1.761905 .363243 .110 -.64072 4.16453
31-40 2.000000* .612048 .037 .09480 3.90520
50 onwards 1.982456* .477889 .022 .29423 3.67069
50 onwards 21-30 -.220551 .371620 .993 -1.28226 .84116
31-40 .017544 .617057 1.000 -1.74275 1.77783
41-50 -1.982456* .477889 .022 -3.67069 -.29423
*. The mean difference is significant at the 0.05 level.
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H15: There is no difference among mean scores of total intentions on income.
Interpretation: A one-way ANOVA was conducted to explore the impact of income

on total intention. Subjects were divided into five groups according to their income
(Group 1: Less than 50000; Group 2: 50000 to 150000; Group 3: 150000 to 250000;
Group 4: 250000 to 350000; Group 5: 350000 onwards). There was statistically
significant difference as p<.05 level in total intention scores for the five income
groups [F (226) = 13.278p=.000]. Therefore, we accept the null hypothesis.
H16: There is no difference among mean scores of total loyalty on income.
Interpretation: A one-way ANOVA was conducted to explore the impact of income

on total loyalty. Subjects were divided into five groups according to their income
(Group 1: Less than 50000; Group 2: 50000 to 150000; Group 3: 150000 to 250000;
Group 4: 250000 to 350000; Group 5: 350000 onwards). There was statistically
significant difference as p<.05 level in total intention scores for the five income
groups [F (226) = 9.225, p=.000]. Therefore, we accept the null hypothesis.
Table 37 Intention, Loyalty on Income ( Annova)
ANOVA
Within Groups 830.551 221 3.758
Total 969.221 225

Total_Intention Between Groups 164.203 4 41.051 13.278 .000
Within Groups 683.248 221 3.092
Total 847.451 225
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Tamhane
95% Confidence
Interval
Dependent (I) 3. Household (J) 3. Household Mean Std. Lower Upper

Variable income? income? Difference (I-J) Error Sig. Bound Bound
Total_Loyalty Less than 50,000 51,000 to

1.105649* .362142 .033 .05532 2.15598
150,000
151,000 to
1.028205 .584539 .599 -.71792 2.77433
250,000
251,000 to
.970310 .479897 .397 -.44395 2.38457
350,000
Greater than
-1.805128* .323345 .000 -2.76140 -.84886
350,000
51,000 to Less than 50,000 -1.105649* .362142 .033 -2.15598 -.05532

150,000 151,000 to
-.077444 .522129 1.000 -1.68516 1.53028
250,000
251,000 to
-.135338 .401539 1.000 -1.35737 1.08669
350,000
Greater than
-2.910777* .188372 .000 -3.44632 -2.37523
350,000
151,000 to Less than 50,000 -1.028205 .584539 .599 -2.77433 .71792

250,000 51,000 to
.077444 .522129 1.000 -1.53028 1.68516
150,000
251,000 to
-.057895 .609732 1.000 -1.88127 1.76548
350,000
Greater than
-2.833333* .496007 .000 -4.39535 -1.27132
350,000
251,000 to Less than 50,000 -.970310 .479897 .397 -2.38457 .44395

350,000 51,000 to
.135338 .401539 1.000 -1.08669 1.35737
150,000
151,000 to
.057895 .609732 1.000 -1.76548 1.88127
250,000
Greater than
-2.775439* .366931 .000 -3.93450 -1.61638
350,000
Greater than Less than 50,000 1.805128* .323345 .000 .84886 2.76140
350,000 51,000 to
2.910777* .188372 .000 2.37523 3.44632
150,000
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151,000 to
2.833333* .496007 .000 1.27132 4.39535
250,000
251,000 to
2.775439* .366931 .000 1.61638 3.93450
350,000
Total_Intention Less than 50,000 51,000 to
-.814922* .264275 .026 -1.57018 -.05966
150,000
151,000 to
.738462 .278530 .102 -.07755 1.55447
250,000
251,000 to
-1.040486 .395455 .126 -2.23574 .15477
350,000
Greater than
2.205128* .250950 .000 1.46853 2.94172
350,000
51,000 to Less than 50,000 .814922* .264275 .026 .05966 1.57018

150,000 151,000 to
1.553383* .268816 .000 .77038 2.33639
250,000
251,000 to
-.225564 .388674 1.000 -1.40343 .95230
350,000
Greater than
3.020050* .240122 .000 2.32287 3.71723
350,000
151,000 to Less than 50,000 -.738462 .278530 .102 -1.55447 .07755

250,000 51,000 to
-1.553383* .268816 .000 -2.33639 -.77038
150,000
251,000 to
-1.778947* .398504 .001 -2.98583 -.57207
350,000
Greater than
1.466667* .255728 .000 .69937 2.23396
350,000
251,000 to Less than 50,000 1.040486 .395455 .126 -.15477 2.23574

350,000 51,000 to
.225564 .388674 1.000 -.95230 1.40343
150,000
151,000 to
1.778947* .398504 .001 .57207 2.98583
250,000
Greater than
3.245614* .379740 .000 2.08051 4.41072
350,000
Greater than Less than 50,000 -2.205128* .250950 .000 -2.94172 -1.46853
350,000 51,000 to
-3.020050* .240122 .000 -3.71723 -2.32287
150,000
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151,000 to
-1.466667* .255728 .000 -2.23396 -.69937
250,000
251,000 to
-3.245614* .379740 .000 -4.41072 -2.08051
350,000
H17: There is no difference among mean scores of total intentions on occupation.
Interpretation: A one-way ANOVA was conducted to explore the impact of

occupation on total intention. Subjects were divided into five groups according to
their occupation (Group 1: Student; Group 2: Employed; Group 3: Self Employed;
Group 4: Housewife; Group 5: Other). There was statistically significant difference as
p<.05 level in total intention scores for the five occupation groups [F (226) = 3.671,
p=.013]. Therefore, we accept the null hypothesis.
H18: There is no difference among mean scores of total loyalty on occupation.
Interpretation: A one-way ANOVA was conducted to explore the impact of

occupation on total loyalty. Subjects were divided into five groups according to their
occupation (Group 1: Student; Group 2: Employed; Group 3: Self Employed; Group 4:
Housewife; Group 5: Other). There was statistically significant difference as p<.05
level in total intention scores for the five occupation groups [F (226) = 6.497, p=.000].
Therefore, we accept the null hypothesis.
Table 38 Intention, Loyalty on Occupation (Annova)
ANOVA
Within Groups 890.996 222 4.013
Total 969.221 225

Total_Intention Between Groups 40.055 3 13.352 3.671 .013
Within Groups 807.396 222 3.637
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Total 847.451 225
Tamhane
95% Confidence
Interval
Dependent (I) 4. (J) 4. Mean Difference Std. Lower Upper

Variable Occupation? Occupation? (I-J) Error Sig. Bound Bound
Total_Loyalty Student Employed .897239* .333924 .049 .00268 1.79179
Self Employed -1.191620* .304301 .003 -2.04942 -.33382
Housewife .169004 .432646 .999 -1.04209 1.38009
Employed Student -.897239* .333924 .049 -1.79179 -.00268
Self Employed -2.088859* .402908 .000 -3.18119 -.99653
Housewife -.728235 .506871 .639 -2.11030 .65383
Self Employed Student 1.191620* .304301 .003 .33382 2.04942
Employed 2.088859* .402908 .000 .99653 3.18119
Housewife 1.360624* .487864 .047 .01370 2.70754
Housewife Student -.169004 .432646 .999 -1.38009 1.04209
Employed .728235 .506871 .639 -.65383 2.11030
Self Employed -1.360624* .487864 .047 -2.70754 -.01370

Total_Intention Student Employed .719707 .301814 .105 -.08452 1.52394
Self Employed 1.224834* .305838 .001 .38243 2.06724
Housewife .737504 .402203 .369 -.37298 1.84799
Employed Student -.719707 .301814 .105 -1.52394 .08452
Self Employed .505126 .336575 .592 -.41240 1.42266
Housewife .017797 .426044 1.000 -1.14873 1.18433
Self Employed Student -1.224834* .305838 .001 -2.06724 -.38243
Employed -.505126 .336575 .592 -1.42266 .41240
Housewife -.487329 .428904 .839 -1.67085 .69619
Housewife Student -.737504 .402203 .369 -1.84799 .37298
Employed -.017797 .426044 1.000 -1.18433 1.14873
Self Employed .487329 .428904 .839 -.69619 1.67085
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Chapter 13: BLIND TESTING
This chapter outlines the details of the test we conducted to check the claim of cereal
users that are they able to distinguish between different cereals or not.
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Blind Testing Procedure:
The following process was followed to carry out the blind taste test of cereals. First of all, the
competing brands were selected, which were available at the LMT stores. The brands that
we selected were Fauji, Kellogg’s and Nestle. The product names are mentioned in the table
below. The second step was developing the questionnaire. In this questionnaire the
parameters to be gauged were included. These parameters are taste, texture, sogginess,
crispiness, appearance, flavor and sugar content. Likert scale was used to measure these
parameters. The third step was the preparation of the testing material. Two types of sample
were used, one with milk and one without milk. The next step was determining the test
group. The test group was a diverse group of people from different age groups, ranging from
11 yrs to 50 yrs. The final step was the execution of step and collection of data.
Cereal samples used:

Following are the details of the cereals used in the cereal blind tastings:
Sample Cereal name Cereal type

A. Fauji Rice Flakes Rice
B. Fauji Choco Cups Wheat
C. Kellogg’s Rice Coco Rice
Pops
D. Fauji Chocolate Pops Corn/Rice Flour
E. Nestle Koko Krunch Wheat
F. Kellogg’s Chocos Wheat
Participants:
Following are the details of the participants:
Participant Name age

1. Hammad 24
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2. Fariha Feroz 40
3. Arqam 21
4. Maryam 11
5. Ruhi 50
6. Amara 15
7. Zeeshan 21
Findings:
The Blind taste test of different cereal brands was conducted, and findings recorded form a
group of cereal consumers belonging to different age groups as stated above. Two different
taste tests were repeated on the same group, first time with dry cereals and second time with
milk added to the cereal. The consumers were handed over a small questionnaire with
parameters which they had to rate. The parameters were; Taste, Texture, Sogginess,
Crispiness, Appearance, Flavor, Sugar content. Three supplementary questions were added
as well for additional information, these questions can be found in the sample questionnaire.
The findings of each person are listed below.
Participant 1: Hammad
Hammad is a university student and an occasional user of cereal. When it comes to the type
of the cereal. This consumer identified Samples A, B, D and E correctly. He identified Sample
C (Rice) as corn cereal and Sample F (wheat) as corn cereal. He liked Sample B, which means
he would prefer eating a wheat cereal. His favorite flavor is chocolate. He gave highest ratings
to the taste of Sample B (wheat) and the lowest taste ratings to Sample A (rice flakes).
Crispiness was one factor where rice flakes received a high rating. Sample C which was rice
pops, also received high rating in terms of taste and flavor, but, was considered too soggy, a
factor not liked by the consumer. He prefers cereal without milk.
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Participant 2: Fariha Feroz
Fariha is an employed woman and a regular user of cereal. Fariha identified Samples B, C, E
and F correctly. She identified Sample A (Rice) as corn cereal, because of its flakey shape and
Sample D (Corn) as wheat cereal. She gave high taste and flavor ratings to Sample E, which
is a wheat cereal, in chocolate flavor. All the other parameters were also rated highly. Both
the rice cereals, flakes and pops, received moderate ratings in all the parameters. Showing
that she did not dislike the rice cereal. She personally liked Sample E (Wheat) and her
preferred flavor would be fruity. She prefers cereal with milk.
Participant 3: Arqam
Arqam is a student and an occasional user of cereal. He identified Samples A, B, D and E
correctly. He identified Sample C (Rice) as corn cereal and Sample F (Wheat) as corn cereal.
He rated Sample B, which is a wheat cereal, very highly in terms of taste and flavor. He likes
sogginess in cereals. Sample A (Rice Flakes) received the lowest ratings. He gave moderate
ratings to Sample C (Rice pops), because of its chocolate flavor and as far as the sogginess
and crispiness are concerned it received moderate ratings for them as well. He personally
liked Sample B (Wheat) and his favorite flavor is chocolate. He prefers cereal with milk.
Participant 4: Maryam
Maryam is a school going kid and is a regular user of cereals. She identified all the Samples
correctly except Sample A (Rice) which she thought to be a corn cereal. She rated Sample A
(Rice Flakes) highly for taste and flavor. Rice pops also received a moderate rating in all
parameters. According to her sogginess should be moderate in a cereal. She has no
preference in flavor. She prefers cereal with milk.
Participant 5: Ruhi
Ruhi is a housewife and she uses cereal very occasionally. She identified Samples A, B, D and
E correctly. She identified Sample C (Rice) as corn cereal and Sample F (Wheat) as corn
cereal. She rated Sample B (Wheat) very highly in all the parameters. Sample A (Rice Flakes)
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was rated the lowest. Sample C (Rice Pops) received moderate ratings and was confused with
corn cereal. She prefers cereal with milk.
Participant 6: Amara
Amara is a student and is a regular user of cereal. She identified all the cereals correctly
except Sample C (Rice) which she identified as a corn cereal. She rated Sample E (Wheat)
very highly in terms of taste and flavor. Crispiness is a factor that she likes in a cereal. She
prefers cereal with milk. Sample C (Rice Pops) received only one low rating for shape
because of the small size of each cereal pop.
Participant 7: Zeeshan
Zeeshan is a student and is a regular user of cereal. He Identified Samples B, D, E and F
correctly. He identified Sample A (Rice) as corn cereal and Sample C (Rice) as corn cereal. He
rated Sample F (Wheat) very High in all respects accept for the Sogginess. He thought the
Crispiness to be too much for this cereal. He likes chocolate flavor in cereals. He prefers
cereal with milk. Sample C (Rice) was rated moderate by this consumer.
Summary of Testing:
As per the blind taste test we are able to make a few conclusions regarding the cereal MATCO
can produce. As far as the shape of the cereal is concerned. It can be seen from the results
above that most consumers found the cup shaped cereal appealing. This shape is achieved
by using an extruder. The cereal texture is aerated, i.e it is porous thus giving it a crispy
popping sound when you eat it. As per the findings above, almost all the participants had
chocolate as their favorite flavor for their cereals. One participant observed that having
chocolate flavor in cereals makes it desirable to be consumed as a snack as well.
Since MATCO is looking to launch a rice cereal, it can be seen in above findings that all the
participants gave moderate ratings to rice coco pops. Whereas rice flakes did not receive a
favorable rating. And almost all the participants confused the rice pop cereal with a corn
cereal. So, if MATCO launches a Rice cereal in cup shape or in the shape of pops and keeps
the chocolate flavor, then it might be a good decision. Rice cereal should not have a shape
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like Kellogg’s rice krispies, as they are very small and thus get very soggy. The shape of rice
cereals should be bigger like that of coco pops. Since almost all the participants preferred
cereals in milk, the big shape of rice cereal will retain crispiness in milk, crispiness is a
desired feature as is evident from the findings. Since a chocolate flavored rice cereal will be
targeting mostly kids. The packaging needs to have a recognizable character on the front and
nutritional value on the side for parents to see and feel confident about the product their
children are consuming. The packaging should have vivid colors to attract children. The
sugar content should be kept ow as more and more parents are concerned about the health
of their children and a low sugar content will help parents feel relaxed when buying the
product.
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Chapter 14: FINANCIAL ANALYSIS
This chapter outlines the financial analysis of MATCO FOODS. This chapter
corresponds to the question of resources of MATCO FOODS available for this project
and also to check the projections of cereal project.
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14.1: Objective
Financial feasibility study has been conducted along with non-financial research to provide
a 360-degree insight regarding the viability of the cereal project. The method selected to
check the sustainability of this project is via calculation of Net Present Value as it takes into
account the present value also it is easier to understand and gives comprehensive results
that could be used during the decision-making process. Our objective is to provide easy to
understand and clear picture of the project financially so that the management takes well
informed decision.
14.2: Formulae
NPV has two formula that depends on the evenness of the cashflows.
1. If the cashflows are even we use this formula
2. Otherwise the following formula is used
Where
R is the expected cashflow in each period
i is the rate of return
n is the no. of period of the project
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14.3: Components
Net Present Value has two major components; firstly, the cashflow projection and secondly
the rate of return, as this project not time bound therefore we have calculated the NPV for
the first 24 months based on our market research that has led us to believe that the
investment of the company will be recovered before this duration.
The cashflow projection is based on the extensive market research done both primary and
secondary, for the purpose of our calculation of we have taken 3 quantities of 5000 units,
10,000 units and 15,000 units with an increase of 5% in the sales from month 13 as we
believe that advertisements and promotions would lead to rise in the sales after a year.
However, in our calculations we have not mentioned the costs due to uncertainty in the
values and there was no basis of assumptions for example the costs would include machine
operating costs, storage/handling costs of raw materials, staff costs and other fixed costs.
For the support of the management we have designed the model of calculations in which the
decided figures could be inserted to get the final NPV of the project.
The other component of NPV is the rate of return for which we have taken the WACC of Matco
Foods as this the risk profile of the project is assumed to be the same as that of the company
in broader perspective.
To calculate the Weighted Average Cost of Capital, we need to find the cost of debt and cost of
equity.
14.3.1: Cost of debt

To calculate the cost of debt, we needed to find the Finance cost, Long Term Finance Secured,
Short term borrowing secured and current portion of long term finance secured. We found
the required information from Matco’s prospectus. By taking the Finance cost and dividing
it by the sum of Long Term Finance Secured, Short term borrowing secured and current
portion of long term finance secured, we found the cost of debt to be at 4.9%. Management
had communicated their cost of debt at 5%, which is very close to what we had calculated.
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Next, we had to find the debt to enterprise value ratio of the company, which we found
through data provided in the prospectus, which came to be at 61.8%. The corporate tax rate
for year 2017-2018 is at 30%.
14.3.2: Cost of Equity

For calculating the cost of equity, we took Risk free rate (Rfr) to be 8.5%, which is the current
yield for a 10-year Pakistani government bond. The market risk premium was taken to at
6%, which we found by discussion with our professors as well as through investing banking
firms. The Equity to Enterprise ratio was calculated to be at 38%.
We initially took the levered beta to be 1, debt to equity ratio at 1.62 and tax rate at 30%, and
unlevered it, which came at 0.46. We then releveled it. Since we do not have the to find the
required beta, we first had to unlever the beta, which was targeted debt to equity ratio, which
the management wants to reach, we assumed it to be 2. Using these figures, the relevered
beta came at 1.12.
Putting the above figures, in the formula, the cost of equity came at 15.24. Matco had told us
that their cost of equity is at 15%, which is very near to what we have calculated.
14.3.3: WACC
The formula for WACC is
WACC=(1-t)(rd)(D/V)+(re)(E/V)
Where rd is the cost of debt and re is cost of equity.
By putting all the figures in the above formula, the weighted average cost of capital was found
to be 5.84.
When using the figures provided by Matco, the weighted average cost of capital was
calculated at 5.72.
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14.4: Recommendation
By going over Matco’s financial statements and prospectus, we found that the company has
a very strong financial position. It has been mentioned and the trend has also shown that
Matco Foods has seen an increase in the bottom line in FY 2017 and the management of the
company expects this trend to continue that. We calculated the gearing ratio, which came out
to be 13.6%. Typically, a gearing ratio of 25% to 50% is considered to be average, which
means that Matco’s gearing ratio is significantly lower than the average. This shows that
Matco has the capacity to take on significantly more debt, and hence it should be focusing on
raising capital through taking debts. This will provide multiple benefits to the company, most
important one being that taking on debt is significantly is significantly less expensive than
raising equity. This can also be seen through the figures shared by Matco, where its cost of
debt was at 5%, whereas it cost of equity was at 15%. Furthermore, Matco, due to its strong
financial position has a very good reputation in the market and can easily approach banks to
take loans at an extremely favorable rate.
Financially it seems viable for Matco Foods to go for this project however the final decision
could be taken when further informed assumptions regarding costs will be made part of the
financial data. Also, the company would have to aim for extensive marketing in order to
achieve the desired amount of sales.
Note: For Reference, Visit Appendix P for Detailed Calculations.
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Chapter 15: DECISIONS
This chapter outlines the final decision table where we summarize our research and
provide conclusion.
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15.1: Decision Table
Table 39 Core Decisions and Information
15.1.1: CORE DECISION

Name Falak
Primary Target Market Young Adults (Users and Buyers)
Secondary Target Market Children (Users) and Mothers (Buyers)
Gender Females as per data but targeting should be toward both. If
different variant then it’s feasible
Occupation Students and Employed
Income group (Household) 50k to 150k
Variants Different for each market
Packaging Front Side, Ingredient, Information, Nutritional Value, Overall
Appearance
Flavor Nutrition Oriented (Chocolate)
Ingredient Rice (Whole Grained)
Size 250 grams at initial phase with option of 500 grams
Place IMT
Price Rs. 275 for 250 grams (Market Competitive)
Highlight Nutritional Value, Convenience
Store Names Imtiaz, Hyper star, Naheed
Location in Karachi Gulshan-e-Iqbal, Defense, Gulistan-e-Johar, and Nazimabad
Competition From International Brands at IMT, Direct competition
Kellogg’s and secondary competitor is Nestle
Should Go? Yes
As per the financial analysis, organization capacity is
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15.1.2: CORE INFORMATION
Association with Cereal Flavor with children and nutrition with adults
Breakfast Normal to Strong User Level, Weekly to Biweekly Use, Cereal
is also used as a snack
Purchase Planning Mostly Unplanned followed by planned. Cereal is purchased as
a part of monthly groceries. Cereal is an important part of
breakfast to some users.
Cereal Associated With Young Adults are here the main users as per research, Cereal is
not just for adults or children. Also used as a snack as well now
Loyalty 87% users can switch to a new brand
Rice Cereal 35% Users have tried rice cereal, lack of info is the main
reason why rice cereal doesn’t succeed.
Blind Test 58% Users are confident they can identify their current
cereal
Blind Testing in Market
New Product Features New name, Price equal or less than competition, and
different variants are preferred by users
Reason to Switch Ingredient, Style
Opinions Advertisement, Friends and Family
Matco. 35% knows Matco, 80% knows Falak
Current Purchasing Monthly purchasing, Rs. 500-1500 spend monthly on
cereals, price of box is between 300 to 500 rupees and
preferred size of box is 500grams followed by 250 grams.
Key points: Marketing properly required in terms of nutrition highlighting, Monthly purchases, BTL
activities, focus on image creation and rice nutrition, should why rice is important for consumers, positive
image of Falak in market (Retailers and Consumers) so cash on it, doctors are not the influencers here but
doctors recommend cereal for children because of nutrition content, consumers don’t want highly processed
cereals so focus on whole grain, variety of cereals is preferred by consumers, growth is in cereal segment so
it’s a feasible decision to go in cereal market.
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15.2: Conclusion
As per our research, with respect to Table 39, we have concluded that the cereal project will
be a feasible option for Matco in terms research and finances. Both researches show that
cereal is a favorable move for Matco. Key information which Matco needs to see is mentioned
in Table 39.
Information related to all the aspect of this research is mentioned in 15.1.1 and related
information is highlighted in 15.1.2. At the end we provided with some key points which are
indirectly related to cereal launch.
It is our prime recommendation to use the cereal name as “FALAK” because its well-known
name for customers and they are highly ranking. This goes in benefit of Matco as they won’t
have to invest a lot in establishing a new name for the cereal. During our research we came
to know how much the customers look for the information for cereals. From start our focus
was on young adults and children but during the last phase of our research, primary target
market appeared to be young adults because of minimum response from children and
mothers. But we can’t ignore the fact that mothers now a day are very conscious of their
children health. So, we conclude that the primary market for cereal is young adults and
secondary is children and mothers. We will have to focus on children by providing the right
information to mothers so that they can choose our rice cereal for them. During the research
it was also noticeable that females uses more cereals than males. That may be because
females are more focused on health than males. More information is needed to prove this
hypothesis.
This research highlights all the key points which are important for consideration for cereal
project success. We have focused on each and every detail which could have been tested in
this research and tried to merge expectation of Matco management in to a result-oriented
research.
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Chapter 16: RECOMMENDATIONS
This chapter outlines the recommendations we have for Matco Foods for the cereal
project.
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1. Rice Cereal:
According to our research, the cereal brand launched by MATCO should be targeted at
children and youngsters as mentioned in the decision. The reason for targeting children is
that they are more prone to trying out a new cereal on the shelf. There is a wide variety of
different brands available for children on shelves and the cereal section mostly attracts
children and their mothers. MATCO should go for the chocolate flavoured rice pops. If it
targets health conscious women, it will have to shape the cereal as rice flakes and there is no
market for this type of product according to our research.
Matco can target this market by innovative packaging displaying famous cartoon characters
or come up with a new mascot that children could come to associate only with Matco cereals.
Competitors were also observed to offer gifts inside the boxes which prompted children to
demand that cereal. Matco can also make use of such a strategy and offer gifts inside the
cereals to make it attractive to children.
2. Packaging for Children:

The packaging should feature a recognizable cartoon character as this product will be
targeted at kids. The packaging should have vivid colors to attract kids. The nutritional value
should also be present on the pack, for parents to be confident about the product. This
information can be featured in an innovative way, so that kids also pay attention to it.
3. Visibility:
MATCO should start by placing the cereals in large LMT stores where it will get sufficient
visibility. Most customers who purchase cereal, do it during weekly shopping at the
supermarkets. The placement should be done in shelves bought separately. A dedicated shelf
that displays only MATCO cereal. LMTs will give a head start for the cereal awareness among
customers and then MATCO can expand into small general stores.
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4. Rice Pops:
The core constituent should be rice. We have seen during our research that if the cereal shape
is identical to other options available in the market, customers end up confusing rice cereal
for corn cereal. A rice pop cereal has the same structure and texture as a corn pops cereal. A
health benefit specific to rice should be highlighted on the packaging thus attracting
customers who would want a healthy product with same structure and texture. A chocolate
flavoured rice pops cereal is a viable option as discussed above.
5. Return Policy:
The distribution of MATCO should be very efficient with easy returns policy for retailers and
quick response to complaints. Fauji has unparalleled penetration in the market and has a
very competitive price range. Its return policy is very effective, they pick up returned product
at a rate of 50% and sales persons pay visits to retailers on a weekly basis, ensuring that
fresh product is available in the market at all times.
6. Price:
The price range of the cereal should be between Rs:180 to 250, for a 250 gm SKU. It will place
MATCO in a favourable position as compared to the competitors.
7. Marketing Campaign:
The two major factors that should be highlighted in the marketing campaigns are
Convenience and Health benefits. These two factors are a recurring theme in our customer
studies. Convenience could be highlighted with ease of making and consuming in least
possible time especially suitable in ever demanding schedule of working people. Health
benefits could be highlighted by focusing on whole grain ingredients which competitors are
also doing. To cut the competition, sugar content can be highlighted as being comparatively
less than the competitors. Today’s customers are increasingly reading the ingredient
contents while making a purchase. Matco can also highlight the natural ingredients free from
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Genetically modified organisms which foreign brands are believed to contain. This is one
thing that could be used to appeal to customer base accustomed to using foreign brands like
Kellogs.
8. Shapes:
Cereals could be made in several shapes and texture. In our blind testing cup shape cereal of
Fauji by the name of Choco cups was liked very much. These are cup shaped with a deep
hollow bottom and curve. Circular shaped cereals were not liked.
9. Size:
Cereals with too small size were liked by children and not by adults. Children found them
easy to chew but adults found them unfulfilling. Matco can develop both sizes to cater to
different segments. A picture of circular shaped cereal is displayed below along with smaller
sized ones:
10. Preference:
The customers like chocolate flavor among a diverse range that included the plain ones. One
of the reason for liking choco cups besides its good taste was its consumption without milk.
Customers liked eating it directly on the go like a snack. A sample picture of it is attached:
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11. Availability:
IBL distributors of Kellogs have clearly said they plan to make available Kellogs wherever
Fauji cereals are available. This means they are going to pursue aggressive distribution
strategy and ensure their presence in Kiryana stores in future. Matco should start from
Supermarkets but gradually move and occupy shelf spaces in Kiryana stores as well. This is
important because independent small groceries (Kiryana stores) accounted for 54% of all
sales in 201618 although this might have dropped to 50% in 2018 but still Kiryana stores
remain a significant channel.
They should make their products available in both LMTs and GTs. Currently, Kellogg’s and
Nestle is only available in LMTs and IMTs, whereas Fauji is mostly available in GTs. Because
of strong presence in GT, Fauji is a market leader in Pakistan. Kellogg’s is a leader in LMTs
and IMTs due to strong presence in shelf space with different variants. Matco can consider
placing their separate point of presence in big stores.
12. Market:
Market is filled with variants such as wholegrain, honey oat, cornflakes to name a few. There
is a lot of competition among big players like Kellogg’s, Nestle, Fauji and Weetabix in current
variants that offers no to little room for new entrants. Such intense competition creates
18
Breakfast Cereals in Pakistan, Euromonitor report 2016 pg 1
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barrier to enter for new companies. In such a scenario, Matco should enter this industry with
a product that has not been a point of focus by other companies previously.
13. Branding:
Entering new market would require exhaustion of huge marketing budget to create a brand
name. Players in breakfast cereal industry does little marketing to stay on top of mind
because there have been only 4 companies dominating the shelf space. Since Matco will have
to start afresh so they should to intensive marketing campaign to position themselves as
market pioneers in rice cereal specifically.
14. Sampling:
Matco should consider doing free sampling to acquaint the customers with the taste of rice
cereals. This is important because traditionally only wheat, wholegrain, honey oat are
mainstream variants. They should also consider using cartoon characters to attract kids also
associate themselves with a mascot and run marketing campaign in different schools across
urban cities to attract kids and engage them in activities.
15. Variety:
Matco should launch rice cereals in different variants such as chocolates, nuts and fruits to
attract variety of target market. They should not limit itself to a basic variant of rice cereal.
In addition to this, they should consider making the packaging very attractive.
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Chapter 17: ADDITIONAL
REQUIREMENTS
In our last meeting with Matco Management, they asked us some questions and
required relevant data. Here we answer those questions with supporting data.
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Question 1: Market size of ready to eat breakfast cereal.
Answer: The market size of Ready to Eat Breakfast cereals was Rs. 2994.7 million in 2016.
Source Euromonitor report pg. 3. If the growth trend continues then the market for cereals
is project to reach PKR. 3810.91 million. The growth trend is depicted below:
Table 40 Market Size
Years 2011 2012 2013 2014 2015 2016 2017 2018

PKR (in millions) 1406.3 1707.9 2056.4 2391.8 2654.7 2994.7 3378.25 3810.91
Yearly Growth 0.21446 0.20405 0.1631 0.10992 0.12807 0.12807 0.12807
Figure 35 Sales of Breakfast Cereals
Question 2: Details regarding Fauji facility.
Answer: Name of Fauji cereal manufacturing entity: Fauji Foundation.
Source: http://www.faujicereals.com.pk/
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Question 3: Details of K-packs.
Answer: K packs grammage: 26gms as can be seen in the below picture:
K packs cost Rs. 26. On average 3 packs are consumed by the adult customers in a meal so
Rs. 78. If Milk pack of Rs. 35 is added then cost of one meal is: Rs. 113. Normal egg and paratha
along with tea costs almost Rs. 100 which is below the cost of a cereal based breakfast.
Cereals have is that most people are still accustomed to regular breakfast including eggs and
parathas and they don’t find cereals as fulfilling as a regular breakfast. However, one
advantage cereals have over regular breakfast is its convenience in a tight morning schedule
of working individuals.
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Chapter 18: APPENDICES
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Appendix A: Secondary Research
Table 41: Sales by volume
Table 42: Sales by Value
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Table 43: Sales by Volume Growth %
Table 44: Sales by Value Growth %
Table 45: NBO Company Shares
Table 46: LBN Brand Shares
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Table 47: Distribution of breakfast cereals
Table 48: Forecast sales by volume
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Table 49: Forecast sales of breakfast
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Table 50: Forecast sales - % volume growth
Table 51: Forecast sales - % value growth
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APPENDIX B: QUESTIONNAIRE FOR LMT/IMT & GENERAL TRADE
NAME: LOCATION:
COMPETITION
▪ What are the names of top 3 brands
▪ What are the basis on which they compete?
▪ What is the range of products and services they offer?
▪ Are their products or services aimed at satisfying similar target markets?
MARKETING
▪ How do they merchandise their products?
▪ What is their marketing strategy?
▪ Do they give any trade offers?
▪ What cereal brands do you display?
▪ Optimum Pricing? Current pricing structure? Joint, discounts?
DISTRIIBUTION
▪ How is the distribution done?
▪ What is the return rate?
▪ How frequently replenishment is done?
▪ Payment Terms? Cash? Credit?
▪ How much is the profit margin?
▪ List potential problems with the product?
CONSUMER BEHAVIOR
▪ What do customers looks for when purchasing?
▪ Who are your customers? Men/women?
▪ How often do they buy it? For a month, a week?
▪ Is there any preference for any kind of cereal (rice, cornflakes, oat)?
▪ Is there any preference for local or foreign brand?
▪ Is price a factor in preference of local or foreign brand?
▪ Do customers ask for a particular cereal or they ask retailers for
recommendation?
▪ Who asks for cereals (housewives, kids)?
MATCO’S PERCEPTIION
▪ How do you perceive the products of Matco?
▪ How Falak rice is doing in the market in terms of distribution?
▪ How Falak rice is doing in the market in terms of pricing?
▪ How often Falak rice is bought by consumers in comparison to other brands
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APPENDIX C: LMT/IMT & GENERAL TRADE INTERVIEWS
INTERVIEW 1
Destination: Shazz
Contact Person: M. Iqbal

Time: 2pm
Date: 7th Sep, 2017
Top running brand is Kellogs due to its wide variety and price. Fauji has no variety. The
distribution is done weekly. Imports are done by themselves. Customer: their own choice,
regular items. No merchandizing. Imported item is seen/handled by themselves. If no stock
is available then delay of 3-6 months. Weetabix complains: fungus, expiry date (very rare).
Mostly female customers buy it. Price also matters, in choice of brands. Only Falak brown
rice, very good response, no distribution problem. Promotional price offered by company
INTERVIEW 2
Destination: Hyperstar (Lucky One Mall)
Contact Person: Ibrhaim Mir

Time: 2:45 pm
Date: 7th Sep, 2017
Kellogs is the most selling brand and all of their flavors have good sales. Milo also has good
sales. The reason for high sales of Kellogs is its variety and good quality (imported brand).
All of their merchandising space is sell out. Distribution is done directly through company. It
is a profitable SKU for the company. Hyperstar generates weekly order for purchases. A
major problem faced by cereals is of worms, however this happens rarely. Expiry issues often
arise or sometimes the brand ambassador is not able to guide well. All of Hyperstar’s
purchases are on credit. For Nestle and similar brands they cannot price the product less
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than 10% of the MRP they do not offer trade promotions. Consumers are not very price
conscious and choose products over their brand preferences. Falak rice has a good name
both in terms of price and distribution. They also have Matco’s biscuits however response
for them has not been great.
INTERVIEW 3
Destination: Diamond Super Mart
Contact Person: Amjad Shah (Floor Manager)

Time: 3:15 pm
Date: 9th Sep, 2017
Nestle is the most selling brand, due to its brand name. Trade offers are discussed in head
office, the salesman has no idea about it. Distribution is also handled by head office (located
at Sakhi Hasan). Cereals are purchased according to demand; hence their sales are weekly as
well as monthly. Children are the biggest consumers of cereals. They have not found any
issues in cereals and product returns are also very rare. It is a running item. The shelf space
is rented out. They do not keep falak rice as they have their own in-store rice brand.
INTERVIEW 4
Destination: Anchor Mart
Contact Person: Amir Adnan

Time: 4:00 pm
Date: 9th Sep, 2017
Most running local brand is Fauji and Nestle. Product return is very less. Fauji’s Dalya or
porridge products often become infested with worms. The store itself handles the inventory
replenishment procedure, although a representative of company visits the store weekly.
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Mostly running brand, including both local and foreign brands, is Kellogs. This will vary from
area to area. In Gulshan, Kellog has highest sales. The reason for high sales of Kellogs is its
high quality. Nestle is considered to have medium quality. Another reason for high sales of
Kellogs is their wide variety. The store has around 25 variants of Kellog and around 8-10
variants of Nestle. The distribution is done through distributors. There is no promotional
activity done for international products. Products with short expiry are identified by
distributors, and some trade offer is presented. Imported items are never returned by
distributor because it would mean a loss for him. Fauji sometimes engage in promotional
activities, such as offering pencil colors etc. (as it is mainly a brand for kids). Regarding
purchase terms, a clear answer was not given, the contact person just said that it depends on
the sales of shop, if a shop has high sales then products are offered on credit, otherwise its
cash. The stock turnover is done weekly, bi-weekly, monthly. It is a profitable SKU. Matco has
a good brand image. In rice the prices of all products are mostly same. The differentiating
factor is the quality. Falak has a good quality. Matco does timely distribution of products.
Merchandising is done by Nestle themselves, their merchandiser visits the store weekly.
Kellogs being an imported brand, does not have a company in Pakistan, hence although they
have a distributor but he plays a minor part. Store charges for product placement. The place
is selected by company. Discounts are offered on bulk purchase. Since Imtiaz purchases huge
amounts in bulk, hence discount offered to them is much greater.
INTERVIEW 5
Destination: Hyderi Super Mart
Contact Person: Umair Ahmad

Time: 5:30 pm
Date: 12th Sep, 2017
Top running brands are Kellogs, Fauji, Post. Kellogs has higher sales than Nestle, with a
significant margin. Shoppers are mostly, women, Children and old people. Dalya is mostly
purchased of Fauji. Purchases are made weekly. Weetabix is purchased monthly while
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porridges are purchased weekly. Sales of Quaker is greater than Fauji. Rates are usually
provided by distributors, company very seldom directs them, it is mostly distributors who
directs the store. Companies’ direct dealings are done mostly with distributors. They are
given trade offers since they buy in bulk quantities, and the offers are better than what would
be offered to small shopkeepers. They receive a lot of complains about cereals, especially
about the issue of worms. 1 out of 5 cereals sold face the issue. Post and Weetabix usually
have a lot of complains. Expiry issues are very rare, as they pick long expiry products.
Merchandising space is sold to companies. They do not face many issues in returning the
products. Fauji easily accepts returns, however Kellog has policies. Matco has a good name.
Mughal is their top competitor. No big issues in distribution. Signature biscuit launched by
Matco but did not run well. Cornflakes have higher sales compared to rice-based cereals.
Children and old people are major consumers, with old people having a higher share. Coco
Crunch has good sales; however, it depends upon promotion offers. Their target market is
middle class consumers. Cereals are a profitable SKU with high margins. The shop is situated
in a high-class locality; hence the people are not very price conscious, but are rather more
brand conscious.
INTERVIEW 6
Destination: Ami’s Store (Khadda Market DHA)
Contact person: Waqar Azeem (department incharge)

Time: 2pm
Kids consume cereals more than adults. Kellogg’s is the highest selling brand of cereals in
Ami’s store. The main reason to purchase Kellogg’s is quality and also the variety that they
produce according to the consumer preference. Price is another factor that the consumer has
in mind when purchasing cereals. Kellogg’s cereals have an affordable price range. Among
the retail stores in defence Ami’s keeps a large variety of cereal brands. They have Kellogg’s,
general mills Post, Nestle, Quaker, Faugi. Ami’s has merchandising contracts with the cereal
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companies. Daily sales for the cereals is 30-35 boxes/Sku of cereals. Ami’s displays cereals
right in the front aisle, and cereal section is visible to the eye as soon as you enter the store.
This placement of cereals also prompts impulse buying. People buy cereals on a monthly
basis. They receive complaints about cereals very frequently, because it is the type of product
that develops fungus if air enters the packaging. And companies have return policy for
cereals. Retailer makes company aware of any problem that might come. Local cereal
companies are responsible for their product, but, imported brands are the responsibility of
Ami’s itself. Ami’s has a 3-day return policy for cereals. They provide companies with shelves
for promotion of their cereals according to the contract with their senior management.
For information about the distribution we will have to meet Ami’s sourcing manager who
can meet between 10am – 2pm.
INTERVIEW 7
Destination: Ebco (The Forum, Clifton)
Contact person: Mohammad Sadiq (floor manager)

Time: 1:45 pm
At ebco, Kellogg’s and Nestle are two major cereal brands. Kellogg’s has highest sales because
it is imported, its price is reasonable for the customers in defense and it has a large variety
of flavors (rice crispies, coco pops). Cereals are a profitable product for ebco. The placement
although is not at the front or very visible to the eye. Ebco does not have a return policy for
cereals. They receive fungus complaints for Weetabix. Youngsters trigger the purchase of
cereals and Kellogg’s variety attracts them. Adults also purchase whole grain cereals at ebco.
Post mostly has whole grain variety whereas Kellogg’s and Nestle have corn and rice cereals
in their range. Local companies like Fauji take care of the merchandising themselves but
imported cereal’s merchandising is done by ebco. They do not receive trade offers from the
companies. Daily sale of cereal boxes is 50 boxes at ebco and people purchase it on a weekly
basis. Falak rice has a good reputation. Ebco does not feel the need for promotion of cereals
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to push the sales, and customers know what they prefer in cereals. Maximum promotion that
ebco does is that if the expiry time of cereals is short, they give a buy one gets one free offer.
If customers ask the sales representative about cereals they mostly direct them towards
Kellogg’s.
Information about distribution could not be confirmed from floor manager.
INTERVIEW 8
Destination: Paradise Store (Schon circle, Clifton)
Contact person: Mohammad Aslam (floor manager)

Time: 2:15 pm
At paradise store Kellogg’s and Post are two popular cereal brands. As both are imported
brands (Kellogg’s from USA and Post from UK). The reason for large sales of Kellogg’s is the
variety that they offer and it has been present in the market for a long time (Market
presence). Price and variety are two driving factors in cereal purchase, but, even if customer
like a brand and its price is a bit higher, they still purchase that cereal. Some customers ask
the sales representative about which cereal to buy. Cereals are supplied to the store trough
distributor. If there are any complaint we only take the product back if the company has a
return policy. In one week they sell around 10 cartons of Kellogg’s cereal and one carton
contains 16 boxes of cereal. This figure is for complete Kellogg’s cereal range. They sell
around 15 cartons of cereal per week (all cereal brands combined). Kids consume cereal
more than adults and they trigger the sales of cereal. Young adults also purchase cereal from
our store, those who prefer cereal in breakfast. They keep very small inventory of falak
because they have their own brand of rice. Their own brand of rice is more profitable.
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INTERVIEW 9
Destination: Naheed Supermarket (Bahadurabad)
Contact person: Mr. Abrar (owner)

Time: 2:15 pm
At Naheed supermarket Kellogg’s, Faugi, Nestle, Quaker oats are the cereal brands available.
Kellogg’s has a higher variety. Sometimes there is a complaint about the quality of cereal.
They take care of the merchandising themselves as companies do not have a system for
merchandising of cereals, according to Manager of Naheed supermarket. Mostly housewives
purchase cereals for the kids, but, we have variety that caters to customers of every age (eg.
Old age customers purchase oats and porridge). Cereal stocks are replenished every week.
They keep falak rice as its reputation is good among consumers and there has been no
problem with its distribution.
INTERVIEW 10
Destination: Hyperstar (Clifton)
Contact person: Mr. Akram (section incharge)

Time: 4 pm
At Hyperstar Kellogg’s and Nestle are the two popular brands of cereal. Nestle koko krunch
is a popular brand among youngsters and Kellogg’s coco pops are also equally popular
among the youngsters. The chocolate version of rice crispies is also offered by kellogg’s, but,
sales of this variant are lower than the above two brands. Old customers mostly purchase
faugi cornflakes and porridge. Shelf space is purchased by local brands for display of cereals
and merchandising of international brands is handled by hyperstar itself. Mostly housewives
purchase cereals.
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APPENDIX D: GT VISITS
S No. store name date

Gulshan Iqbal #14
1 Noorani store 26-Sep-17
2 Friend mini mart 26-Sep-17
3 Saim store 26-Sep-17
4 Shayan store 26-Sep-17
5 Imran store 26-Sep-17
Gulistan jauhar
6 Bin mehboob 29-Sep-17
7 Tahir General Str 29-Sep-17
8 Maymar Medico 29-Sep-17
9 Sayem General 29-Sep-17
10 Universal 29-Sep-17
Bahadurabad
11 Diwan Store 2-Oct-17
12 Indus 2-Oct-17
13 Habib Cold 2-Oct-17
FB area Hussainabad
14 Popular mart 5-Oct-17
15 Bismillah Rice 5-Oct-17
16 Amma store 5-Oct-17
17 Rashid store 5-Oct-17
Bufferzone
18 Mashallah 9-Oct-17
19 MD super 9-Oct-17
20 Madni 9-Oct-17
21 Tamweer 9-Oct-17
22 Raheel Medical 9-Oct-17
North Nazimabad
23 Zaheer 13-Oct-17
24 Shamsi Medico 13-Oct-17
25 Noor bakery 13-Oct-17
26 Shalimar Bakery 13-Oct-17
27 Subhanallah 13-Oct-17
28 Jannat 13-Oct-17
Gulshan Iqbal # 4
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29 New discovery 16-Oct-17
30 Cash and carry 16-Oct-17
31 Home needs 16-Oct-17
32 Al taymurya 16-Oct-17
33 Rehan Medical 16-Oct-17
Defence phase 6
32 Quetta store 18-Oct-17
33 Al wakeel 18-Oct-17
34 Idrees agha 18-Oct-17
35 Bismillah store 18-Oct-17
36 Askari store 18-Oct-17
Defence phase 2
37 Skaikh store 23-Oct-17
38 Ghosia store 23-Oct-17
39 Ahmed store 23-Oct-17
40 Mashallah store 23-Oct-17
41 Al haseeb 23-Oct-17
Clifton block 2
42 Hassans store 26-Oct-17
43 Shabbir 26-Oct-17
44 DD mink 26-Oct-17
45 Murshid 26-Oct-17
46 Al rehman 26-Oct-17
Clifton block 5
47 tenis mart 28-Oct-17
48 shop shop 28-Oct-17
49 rahat 28-Oct-17
50 new prince 28-Oct-17
51 Jamia Store 28-Oct-17
Nazimabad
51 Saadi 03-Nov-17
52 Makkah store 03-Nov-17
53 Bismillah 03-Nov-17
53 Al Rehman 03-Nov-17
53 Alamgir Super Store 03-Nov-17
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APPENDIX E: QUESTIONNAIRE FOR DOCTORS
1) To what kind of patients do you recommend Cereals?
2) What is the brand that you prefer?
3) What variety of cereals do doctors or nutritionists prefer?

Wholegrain/Oat/Rice/Corn based?
4) What is the average age of your patients whom you recommend?
5) What kind of cereals do you recommend to adults?
6) Reasons for recommendation?
7) Do you receive any complaints from patients after consuming cereals?
8) What kind of cereals generate more complaints?
9) Do companies approach you to recommend their cereal to patients every time?
10)Do they have enough variety to cater all kinds of patients of all ages?
11)Do you have a contract with these companies for promotion?
12)What ingredients in cereals do you think should be avoided? (eg sugar)
13)Do you stop certain consumers from consuming cereals? (eg children for risk of
obesity)
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APPENDIX F: DOCTORS VISITS
In Depth Liaquat
Dr. Malahat Sohaib
13th November Interview Paediatrician National
In Depth
Dr. Yumna Sadiq
14th November Interview Nutritionist Indus Hospital
In Depth
Dr. Tooba
In Depth
Dr. Sana
In Depth
Dr. Shaima Amjad
16th November Interview Cardiogist Aga Khan
In Depth Liaquat
Dr. Moomal Mehmood
18th November Interview Paediatrician National
In Depth
Dr. Kulsoom Ghous
18th November Interview Paediatrician Civil Hospital
In Depth
Dr. Sukaina Rupani
20th November Interview Paediatrician Civil Hospital
In Depth
Dr. Iffat Farhan
21st November Interview RMO Tabba Hospital
In Depth
Dr. Sana Saleh
21st November Interview Paediatrician Civil Hospital
In Depth
Dr. Shumaila Farhan
22nd November Interview Paediatrician Civil Hospital
In Depth Liaquat
Dr. Hina Naz
27th November Interview Nutritionist National
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APPENDIX G: FOCUS GROUP – MALE STUDENTS
LOCATION: IBA BOYS HOSTEL
MODERATOR: SHED ANEEQ IMTIAZ
ASSISTANCE: HASHAM ZAHID
NUMBER OF PARTICIPANTS: 8 (aged 21-28)
DATE: 25TH DECEMBER, 2017
DURATION: 50 MIN
Moderator: Assalam o Alikum, My name is Aneeq and I am from MBA. We are doing a final
year project on Matco Foods to study the consumption pattern of breakfast cereals. It is going
to be a 40 minutes of Focus Group. Division of the focus group is like, I would first ask
questions related to breakfast, then will inquire from users then non-users and finally about
company.
First, I would like everyone to introduce himself as per name, age and are you live in.
Respondent 1: My name is Bilal, I have done MBA from IBA and I have worked in Packages
for 4 years.
Respondent 2: My name is Mubeen, I am from Islamabad and I am doing MBA from IBA.
Respondent 3: My name is Ammar, I have completed my MBA from IBA and I am from Lahore.
Respondent 4: My name is Hassan and I belong from Rawalpindi.
Respondent 5: My name is Arham and I belong from Multan.
Respondent 6: My name is Muhammad, I work at software house.
Respondent 7: My name is Naqeeb Raza, I belong from Bahwalpur, but I live in Gulshan now.
Respondent 8: My name is Kamran. I am from Hyderabad and I am a Telecom engineer.
Moderator: Now, I am going to ask you about your family background because breakfast is
something in which your family is involved as well. So, enlighten me with your number of
family members and the age of decision maker in grocery.
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Bilal: My mother is about 48 or 49 years old. Our family constitutes of 5 members.
Mubeen: My mother does most of the shopping and she is about 50 years old. Our family
constitutes of 5 members.
Ammar: Our family constitutes of 5 members. Mother does the shopping and her age is in
50s.
Hassan: My family constitutes of 3 family members. And my mother does grocery.
Arham: Our family constitutes of 6 family members. Mother is the decision maker at an age
of 50.
Muhammad: our family has 5 members. She takes most of the decision and her age is around
50.
Naqeeb: My mother’s age is 51 and she does all the grocery. We are 5 family members.
Kamran: We also have 5 family members. My mother is the decision maker and she is around
50.
Moderator: The next part is going to be about breakfast preference. There are some people
who do regular breakfast and some tend to skip it. How do you go about it?
Bilal: When I was doing job, I would not skip it, but after being a student full tiem MBA I
started skipping it.
Mubeen: Before my MBA, I used to eat breakfast regularly, but now especially on weekends,
I would skip it.
Ammar: Mine is also similar, when I was doing job I was much regular than I have been after
leaving job. I tend to skip it frequently now.
Hassan: It depends upon routine, If I get up late and running out of time for the class then I
would usually skip breakfast otherwise I would do.
Arham: I don’t miss breakfast on holidays otherwise I usually do.
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Muhammad: I used to skip it when I was studying, but since I have to get up for the job early
so I rarely skip breakfast.
Naqeeb: I used to skip breakfast when I was working. Even as a student, I am skipping it. It’s
not very important for me.
Kamran: I am regular. Without breakfast my day does not start.
Moderator: There’s a very mixed response on this. How important you think breakfast is?
Bilal: I think it is the most important meal of the day. You should eat healthy, but the
important thing is that you should have breakfast. Without it your day is incomplete and you
start your day with depriving the body of its requirement. I think it is very important to feel
fresh and work actively.
Mubeen: I think similarly that it is very important. I have tried that when I don’t do breakfast
I feel lazy and lethargic that day. My days are more active when I have breakfast.
Ammar: My perspective is also same, but I want to say that it is important to have the meal
as soon as you get up, be it breakfast or lunch.
Hassan: I think, as far as nutritional value is considered, breakfast is very important because
your stomach is empty at night and when you get up you need energy.
Arham: I will agree with Bilal that for a healthy lifestyle one needs breakfast.
Muhammad: I believe that not having breakfast has a psychological impact that you will feel
lazy and lethargic. So, it is important to have breakfast even if you cant have heavy breakfast.
I usually eat Anda Paratha, but when I don’t then I eat fruits.
Naqeeb: My perspective is that as nutritionists say that breakfast is very important mean but
it is my laziness that I don’t eat it.
Kamran: It is important.
Moderator: For rest of the session, let’s consider that you are not in hostel and you are living
your regular life at your own home. Considering this what kind of breakfast do you prefer?
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Bilal: Everything. You cannot keep monotonous everyday. If you are eating cereals then you
cannot eat it for 7 days. More like mix and match. Sometimes you can eat eggs with paratha
sometimes with bread and sometimes you can even go out for breakfast. Sometimes you go
for boiled egg or just a glass of milk. That’s it.
Mubeen: I mostly eat paratha, chai and an egg on weekdays. On weekends, I eat aalo ka
paratha with yogurt and sometimes halwa puri on Sundays.
Ammar: I will agree with them. I do not have any specific menu. Somedays you eat anda
paratha and other days you can have cereals.
Hassan: I eat anda paratha.
Arham: I eat cereals and anda alternatively.
Muhammad: At home, I don’t usually consider healthy option. I eat anda paratha and
sometimes fried eggs. In winter, I eat saag and on weekends I eat khullay channay
Naqeeb: When I get up I don’t feel like doing breakfast, so I prefer eat 2 toasts of bread or
fruit or a boiled egg. I prefer to eat light as much as possible.
Kamran: I prefer boiled eggs.
Moderator: Ok, If I give you 5 options to choose from what would you choose? Convenience?
Nutrition? Taste? Heavy breakfast? Light breakfast?
Biilal: I prefer all. It depends upon the situation. If I wake up on weekends I will overlook
nutrition and will go for heavy breakfast because its your holiday and you prefer something
different. Secondly, if I am doing a job then I will go for convenience in which I can also eat
cereals which is easiest among other options. Sometimes, when I gym I prefer nutrition.
Mubeen: Usually I eat what is made at home by my mother or servant, but when I get late I
eat cereals, or drink tea or a glass of milk or even shake, whatever that is convenient. On
holidays, we usually have different kind of breakfasts and here taste becomes preference.
Ammar: When I have to go to university then I see convenience. But, when it’s a holiday then
you either go for taste or heavy breakfast.
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Hassan: At home I usually prefer taste.
Arham: For me, it is taste and then convenience.
Muhammad: At home I prefer taste. But at hostel, I prefer convenience because we have
limited options.
Naqeeb: For me light breakfast.
Kamran: Health matter a lot to me.
Moderator: Do all family members have same breakfast or are there varieties according to
preference?
Bilal: Normally, it doesn’t work like we order differently. But, 3-4 options are served and
then we can choose what we prefer from it.
Mubeen: At home, mostly we have same breakfast.
Ammar: Usually, we are served with same breakfast, but when I am in a hurry then I settle
for a glass of milk or boiled eggs, but that rarely happens.
Hassan: At home, usually only 2 types of dishes are served like anda paratha or anything. We
usually have same breakfast.
Arham: At my home everyone is doing job so we have different timings. My parents are
diabetic so they have to do breakfast at 6:30 or 7am and since rest of us have different
timings, so we manage our breakfasts according to ourselves.
Muhammad: Mostly it is same for entire family.
Naqeeb: At my home, usually 2 types of dishes are served. One being saalan and other being
bread and egg.
Kamran: In my family everyone prefers different thing.
Moderator: Is there anyone in your family health conscious? Or is your entire family health
conscious?
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Bilal: Normally, for parent who have come to an age, doctors recommend low fat
consumption for people over 50 and high consumption of protein and fiber. So in that case
my parents take care of it. Whereas myself and sibling are less concerned about health.
Mubeen: My parents don’t consume oily things much; whereas, I do.
Ammar: We are not generally health conscious people, but ever since my father has become
diabetic, he has become health conscious. Since I was gaining weight so I have become health
conscious now.
Hassan: The age of my parents are quite old so they are health conscious.
Arham: I and father are not health conscious, but my siblings and my mother are.
Muhammad: In my family, if a doctor recommends diet for a time being then yes, we become
health conscious, otherwise generally we are not.
Naqeeb: In my family, we mostly eat healthy food with less oil consumption.
Kamran: In my family, everyone is health conscious.
Moderator: If you were to rate convenience on the scale of 10, where 10 being most
important. How would you rate?
Bilal: 7
Mubeen: 6
Ammar: 7
Hassan: 8
Arham: 8
Muhammad: 7
Naqeeb: 7
Kamran: 3
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Moderator: We are done with our first part of the focus group. The next part is only for non-
users. This section is about breakfast cereals only. My first questions is that how do you
perceive breakfast cereal?
Muhammad: In our culture, it is more like you do breakfast to remain hunger free until lunch.
But, for cereals even though I have never consumed it, but I feel like it is very light and is not
appropriate for breakfast.
Naqeeb: I agreed to Muhammad. Even though I have never used it but my perception is that
it is a man-made thing and it is not nutritious than other organic foods.
Kamran: I get un-natural feeling from it made in factory.
Moderator: What would be the one or two reasons for not consuming cereals?
Muhammad: As said earlier, it’s a perception it’s not very fulfilling and its made in factories.
Naqeeb: Awareness and unhealthy.
Kamran: I have diet of protein related so I prefer boiled eggs which are not available in
cereals. In addition to this, no one in my family has ever bought this, so I never tried.
Moderator: Do you remember seeing any recent campaign of Cereals?
Muhammad: I remember of Kellogg’s campaign on Star plus. But, I cannot recall any local
ads. I remember seeing fauji’s that too in childhood.
Naqeeb: I don’t remember any campaign.
Kamran: Same here.
Moderator: First thing that comes in your mind on hearing cereals?
Muhammad: Kellogg’s and Dalliyah
Naqeeb: Dalliyah and powdered food.
Kamran: Dalliyah.
Moderator: What associations have you made with breakfast cereals?
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Muhammad: Lavish breakfast. Not fullfiling. Taste is not good
Naqeeb: As I am carrying so much fat, I used to have heavy breakfast, but now I prefer light
breakfast.
Kamran: Tasteless.
Moderator: Do you think it is more nutritious than other options you have?
Muhammad: I have not used it, but still I don’t think it is more nutritious.
Naqeeb: I think it is nutritious and good for people doing diet and those who are diabetic
Kamran: I think it is related to health. There are some types of cereals, some with sugar other
with high fiber. I think both health and unhealthy cereals are available in market.
Moderator: If I give you two options, one foreign brand and other local brand, which one
would you prefer and why?
Muhammad: Foreign. In western culture they use pan cakes and cereals and all in breakfast.
So, I will prefer that.
Naqeeb: I will go for imported things because they are good in quality.
Kamran: I too will go for imported cerals because it is there thing and they would know
better in producing than us.
Moderator: Let’s assume you are short of time and you want to have a convenient breakfast
with many options and cereal being one. What would you prefer?
Muhammad: For convenience, I would opt for this because I have seen ads that focus on
convenience of cereal consumption.
Naqeeb: If I am living in hostel or flat where I don’t have kitchen facility then I will prefer
drinking milk or fruit.
Kamran: Obviously, I will consider it then.
Moderator: Any factor that will make you the user of cereals?
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Muhammad: For me, they are tasteless and I think it’s for kids. If it’s targeted in a way that
it’s nutritional values are for the people of our age then I might consider.
Naqeeb: I think there is not much awareness of it, even I don’t know about it. If awareness is
increased then most likely people will move.
Kamran: If the content of protein is increased then I will consider consuming it.
Muhammad: There are very limited flavors and variants available. I wish there were chicken
tikka flavor.
Moderator: Here, I conclude with non-users and now I will be asking questions from users.
It is again going to be a 10 minutes of round. I will start with a question that are you a
customer or consumer? Or both?
Bilal: Both
Mubeen: Consumer
Ammar: Both
Hassan: Both
Arham: Both
Moderator: Your reasons for consuming breakfast cereals?
Bilal: I like it.
Mubeen: I eat when I don’t do breakfast.
Ammar: For convenience and change of taste
Hassan: Convenience.
Arham: Taste and convenience.
Moderator: What are the attributes you associate with cereals?
Bilal: Hygienic and high quality
Mubeen: Easy to make
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Ammar: Convenience and taste
Hassan: Quality and nutritional value.
Arham: Easy and good quality.
Moderator: Since you guys are the users, you know there are multiple option to pick from
like corn, oat, wheat and rice. Which one would you prefer or indifferent?
Bilal: I am indifferent. It depends upon the word of mouth of the peers I live among.
Mubeen: I have eaten two types. Corn flakes and normal dalliyah.
Ammar: I try new flavors and variants.
Hassan: When I do exercise then I see that oatmeal has higher nutritional values than others
then I become specific.
Arham: I like corn flakes.
Modeartor: What do you think are the health benefits of breakfast cereals?
Bilal: Health, I don’t know if there are actually or not.
Mubeen: I think they are very light and it has no fat.
Ammar: They are high in fiber which I think is very good. And overall the nutritional value is
also very good.
Hassan: Losing weight.
Arham: I generally don’t drink milk, but with cereals I can.
Moderator: Have you ever read ingredient labels or just consumed it without reading?
Bilal: Yes, without seeing.
Mubeen: I generally read about things, but for cereals I don’t.
Ammar: Never.
Hassan: No
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Arham: No.
Moderator: Do you think cereal consumption helps in reducing weight and maintaining
blood pressure?
Bilal: For BP, I cannot comment. For weight reduction, it becomes questionable if you are
adding sugar to it to make it tasty.
Mubeen: It’s true that by adding sugar you deprive all the health benefits. Secondly, I think
because of high fiber and low fat, you maintain cholesterol and blood pressure.
Ammar: I think there are many health benefits especially for oatmeal.
Hassan: In regular breakfast, we have so much of an oil, considering that it has no oil, so I
think it is good.
Arham: I think Kellogg’s has low sugar content so they are good options.
Moderator: You are both customer and consumer, so what factors you consider when making
a purchase?
Bilal: Company, taste and price.
Mubeen: I have rarely purchased, but whenever I did I just bought corn flakes.
Ammar: I go for new variants and then price.
Hassan: Variants and price
Arham: Brand and variant
Moderator: What specific brand do you purchase and reasons for choosing that?
Bilal: Nestle produces chococo. I prefer because they are trustable, secondly price falls in the
bracket that I presume that is right for the product. Taste is epic.
Mubeen: I buy cornflakes of Fauji and desi dalliyah from normal shops.
Ammar: I don’t have any specific brand I keep changing it. But I usually buy Fauji because of
price and availability.
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Hassan: Fauji corn flakes
Arham: Fauji Corn flakes and nestle’s choco pops.
Moderator: Do you go for repeated purchases or new variants?
Bilal: Repeated purchase. I just buy one. It’s an expensive product so you don’t feel like
wasting money on trying new one.
Mubeen: Repeated. Rarely changed.
Ammar: Not repeated.
Hassan: I just buy Nestle’s.
Arham: I switch between 2 brands only.
Moderator: How much role a price plays in choosing a cereal?
Bilal: it is one of the mainstream reasons in choosing a product because it is expensive.
Mubeen: I buy one specific brand and I have not checked its price.
Ammar: Price in important but it doesn’t matter much to me.
Hassan: For me price is 9/10, but you cannot pay premium just to get a convenient product.
Arham: I prefer convenience over price unless there is a drastic difference in price.
Moderator: Are you brand conscious or price conscious?
Bilal: Brand conscious.
Mubeen: Brand.
Ammar: Brand
Hassan: Brand
Arham: Brand.
Moderator: How much role does variant play in decision?
Bilal: I only buy one variant so I am indifferent.
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Mubeen: Not much
Ammar: For me, it matters a lot.
Hassan: Not much.
Arham: Doesn’t matter.
Moderators: What factors will make you switch to other brands?
Bilal: They start giving for free. I am brand loyal.
Mubeen: Free sampling. I wont switch unless I don’t taste it.
Ammar: Promotions like ATLs and BTLs communicating about the offerings.
Hassan: Promotion and communication.
Arham: Trials.
Moderator: Have you ever faced problem related to cereals?
Bilal: It opens easily. Nothing.
Mubeen: No
Ammar: No, but since I keep on trying new variants sometimes I buy wrong variant.
Hassan: Sometimes I get broken cereals from inside.
Arham: I think packaging. Because it makes cereals non-crispy.
Moderator: How often do you purchase it?
Bilal: Twice every month.
Mubeen: once in 2 months.
Ammar: Once in a month.
Hassan: Twice in a month
Arham: Once in a month.
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Moderator: How often do you consume it?
Bilal: every other day
Mubeen: twice or thrice a week.
Ammar: Twice
Hassan: Once a week.
Arham: Twice a week.
Moderator: Do you have any specific time to eat cereals or eat at any time of the day?
Bilal: Anytime
Mubeen: Mostly at night as snacks or breakfast.
Ammar: When you are short of time in morning then you consume cereals. Also, when you
need snacks at midnight then too you consider eating it.
Hassan: breakfast
Arham: Any time as a snack.
Moderator: Do you consume cereals with something or separately?
Bilal: With milk.
Mubeen: Just Cereals.
Ammar: Ceraels.
Hassan: Only cereals.
Arham: I put toppings of fruits.
Moderator: Last question of this section is whether you purchase it from LMTs/IMTs or
General Trades?
Bilal: It comes with monthly grocery, so I prefer LMTs or IMTs.
Mubeen: Super stores or big markets.
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Ammar: same
Hassan: LMT/s or IMTs with monthly grocery
Arham: Same as Hassan
Moderator: Does packaging matter?
Bilal: It does.
Mubeen: yes
Ammar: Definitely
Hassan: Yes
Arham: Yes
Moderator: In this last section of 5 minutes, I would be asking questions about a particular
company. First question is, have you ever heard of Matco Foods?
Bilal: Yes
Mubeen: No
Ammar: No
Hassan: No
Arham: No
Muhammad: No
Naqeeb: No
Kamran: No
Moderator: Have you ever heard of Falak Rice?
Bilal: Yes
Mubeen: No
Ammar: yes
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Hassan: yes
Arham: No
Muhammad: yes
Naqeeb: No
Kamran: No
Moderator: If you said Yes, then how do you perceive Falak rice?
Bilal: It is the largest exporter of rice in Pakistan. If they are exporting to 47 countries across
the globe then I believe it’s of high quality. I think it is good and strong brand in International
market.
Ammar: High Quality rice.
Hassan: I think it is at par with Guard’s rice
Muhammad: I think it competitive with international brands.
Moderator: Those who said they have heard of Falak, if they want to enter with the name
Falak in breakfast cereals then would you consider buying?
Bilal: It sounds funny.
Ammar: If they bring good variants then definitely I will try.
Hassan: Mostly my mother buys, so if she buys it then I will.
Muhammad: I will try it because I have heard very good reviews about falak.
Moderator: Since you guys know about Falak, do you have any complains or reservations
regarding Falak, be it quality, price or distribution?
Bilal: I have worked with them as client. I think the culture of Falak is unprofessional. Since
stigma is attached with it so I believe it automatically gets attached with brand.
Ammar: I have no idea because I never bought it directly
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Hassan: Distribution I think because they are mostly available at LMT’s and IMTs but rarely
in General stores.
Muhammad: I also think distribution, because it is mostly unavailable in small stores.
Bilal: Normally, in Punjab the awareness of Falak is low as compared to South.
Moderator: Here, we conclude our focus group. I would like to thank each and every one of
you for the participation.
APPENDIX G-1: THEMATIC ANALYSIS – MALE STUDENTS
Themes Dialogues
Attributes: - Hygienic and high quality
Easy to make
Convenience and taste
Quality and nutritional value.
Easy and good quality.
Reason for consumption I like it.

I eat when I don’t do breakfast.
For convenience and change of taste
Convenience.
Taste and convenience.
Health Benefits Health, I don’t know if there are actually or

not.
I think they are very light and it has no fat.
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They are high in fiber which I think is very
good. And overall the nutritional value is
also very good.
Losing weight.
I generally don’t drink milk, but with cereals
I can.
For BP, I cannot comment. For weight
reduction, it becomes questionable if you
are adding sugar to it to make it tasty.
It’s true that by adding sugar you deprive all
the health benefits. Secondly, I think
because of high fiber and low fat, you
maintain cholesterol and blood pressure.
I think there are many health benefits
especially for oatmeal.
In regular breakfast, we have so much of an
oil, considering that it has no oil, so I think it
is good.
I think Kellogg’s has low sugar content so
they are good options.
Foreign vs local: Non-user
Foreign. In western culture they use pan
cakes and cereals and all in breakfast. So, I
will prefer that.
I will go for imported things because they
are good in quality.
I too will go for imported cereals because it
is there thing and they would know better
in producing than us.
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Brand attachment: - Nestle produces chococo. I prefer because
they are trustable, secondly price falls in the
bracket that I presume that is right for the
product. Taste is epic.
I buy cornflakes of Fauji and desi dalliyah
from normal shops.
I don’t have any specific brand I keep
changing it. But I usually buy Fauji because
of price and availability.
Fauji corn flakes
Fauji Corn flakes and nestle’s choco pops.
Willing to try new brands or repeated

- Repeated purchase. I just buy one. It’s an
purchase: expensive product so you don’t feel like
wasting money on trying new one.
Repeated. Rarely changed.
Not repeated.
I just buy Nestle’s.
I switch between 2 brands only.
Brand vs price consciousness: All are cereal users are brand conscious
Preference for a certain cereal I am indifferent. It depends upon the word

of mouth of the peers I live among.
I have eaten two types. Corn flakes and
normal dalliyah.
I try new flavors and variants.
When I do exercise then I see that oatmeal
has higher nutritional values than others
then I become specific.
I like corn flakes.
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Problems regarding cereals It opens easily. Nothing.
No
No, but since I keep on trying new variants
sometimes I buy wrong variant.
Sometimes I get broken cereals from inside.
I think packaging. Because it makes cereals
non-crispy.
Importance of Packaging (Does it It does.
matter) yes
Definitely
Yes
Yes
Perception of breakfast cereals Non users
In our culture, it is more like you do
breakfast to remain hunger free until lunch.
But, for cereals even though I have never
consumed it, but I feel like it is very light and
is not appropriate for breakfast.
I agreed to Muhammad. Even though I have
never used it but my perception is that it is
a man-made thing and it is not nutritious
than other organic foods.
I get un-natural feeling from it made in
factory.
Lavish breakfast. Not fullfiling. Taste is not
good
Tasteless.
I have not used it, but still I don’t think it is
more nutritious.
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I think it is nutritious and good for people
doing diet and those who are diabetic
I think it is related to health. There are some
types of cereals, some with sugar other with
high fiber. I think both health and unhealthy
cereals are available in market.
As said earlier, it’s a perception it’s not very
fulfilling and its made in factories.
Awareness and unhealthy.
I have diet of protein related so I prefer
boiled eggs which are not available in
cereals. In addition to this, no one in my
family has ever bought this, so I never tried.
Factors which might turn non-user into For convenience, I would opt for this
users because I have seen ads that focus on
convenience of cereal consumption.
For me, they are tasteless and I think it’s for
kids. If it’s targeted in a way that it’s
nutritional values are for the people of our
age then I might consider.
I think there is not much awareness of it,
even I don’t know about it. If awareness is
increased then most likely people will move.
If the content of protein is increased then I
will consider consuming it.
There are very limited flavors and variants
available. I wish there were chicken tikka
flavor.
Usage Pattern every other day
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twice or thrice a week.
Twice
Once a week.
Twice a week.
Consumption Habit Anytime

Mostly at night as snacks or breakfast.
When you are short of time in morning then
you consume cereals. Also, when you need
snacks at midnight then too you consider
eating it.
breakfast
Any time as a snack.
Consumption separately or with
something
With milk.
Just Cereals.
Ceraels.
Only cereals.
I put toppings of fruits.
Importance of convenience (rating out of 7

10) 6
7
8
8
7
7
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3
Ad recall Non Users

I remember of Kellogg’s campaign on Star
plus. But, I cannot recall any local ads. I
remember seeing fauji’s that too in
childhood.
I don’t remember any campaign.
Same here.
Price point it is one of the mainstream reasons in
choosing a product because it is expensive.
I buy one specific brand and I have not
checked its price.
Price in important but it doesn’t matter
much to me.
For me price is 9/10, but you cannot pay
premium just to get a convenient product.
I prefer convenience over price unless there
is a drastic difference in price.
Role of variant availability I only buy one variant so I am indifferent.

Not much
For me, it matters a lot.
Not much.
Doesn’t matter.
Purchase Pattern Twice every month.

Mubeen: once in 2 months.
Ammar: Once in a month.
Hassan: Twice in a month
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Arham: Once in a month.
Purchase Point It comes with monthly grocery, so I prefer
LMTs or IMTs.
Super stores or big markets.
same (i.e. Super stores or big markets.)
LMT/s or IMTs with monthly grocery
Same as Hassan (i.e. LMT/s or IMTs with
monthly grocery)
Brand Switching Factors They start giving for free. I am brand loyal.
Free sampling. I wont switch unless I don’t
taste it.
Promotions like ATLs and BTLs
communicating about the offerings.
Promotion and communication.
Trials.
Purchase factors: - Company, taste and price.
I go for new variants and then price.
Variants and price
Brand and variant
Awareness of Matco Yes

No
No
No
No
No
No
No
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Awareness of Falak Yes
No
yes
yes
No
yes
No
No
Perception of Falak rice It is the largest exporter of rice in Pakistan.

If they are exporting to 47 countries across
the globe then I believe it’s of high quality. I
think it is good and strong brand in
International market.
High Quality rice.
I think it is at par with Guard’s rice
I think it competitive with international
brands.
Perception of Falak’s upcoming cereals It sounds funny.
If they bring good variants then definitely I
will try.
Mostly my mother buys, so if she buys it
then I will.
I will try it because I have heard very good
reviews about falak.
Complaints about Falak I have worked with them as client. I think

the culture of Falak is unprofessional. Since
stigma is attached with it so I believe it
automatically gets attached with brand.
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I have no idea because I never bought it
directly
Distribution I think because they are mostly
available at LMT’s and IMTs but rarely in
General stores.
I also think distribution, because it is mostly
unavailable in small stores.
Normally, in Punjab the awareness of Falak
is low as compared to South.
APPENDIX H: IN-DEPTH INTERVIEW – MALE STUDENT

LOCATION: IBA Karachi
INTERVIEWER: Hasham Zahid
INTERVIEWEE: Raheel Qureshi (Age. 31)
TIME: 7:30 to 8:00pm
Residence Area: - North Nazimabad Buffer Zone Sector 15/B
Q. How many family members constitute your household?
Ans. My family consists of 4 members.
Q. What are their ages?
Ans. They are aged from 10 to 50.
Q. Is the eldest female in your house a working woman or a house wife?
Ans. yes
Q. Who does grocery and how often?
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Ans. The grocery shopping is done by my mother once a month.
Q. Do you like breakfast? Is it good if someone skips it? If you skip breakfast, then why?
Ans. Yes I like to eat breakfast, and try my best not to avoid it. I believe it is not beneficial for
a person’s health to skip the breakfast, hence I try my best to eat it. However, sometimes due
to shortage of time in the morning, I have to skip it else I get late for my job.
Q. At what time do you usually have breakfast?
Ans. I usually have breakfast at 7:30 am.
Q. Do consider breakfast to an important meal of the day?
Ans. Of course yes. It is the most important meal of the day.
Q. Advantages/disadvantages of breakfast?
Ans. Nothing special
Q. Contribution of breakfast in our daily routine? Negative and positive?
Ans. I believe breakfast has a positive contribution to our daily routine.
Q. What do you like to have in breakfast? And why that?
Ans. I usually like to eat something sweet in the breakfast.
Q. What’s more important when choosing breakfast? Convenience? Taste? Nutrition? Heavy
breakfast? Light breakfast?
Ans. Because I have very less time in morning, I will choose convenience as I cannot wait a
long time for the breakfast to be prepared.
Q. Do you like changes in breakfast menu or you follow it in a routine?
Ans. I follow a routine breakfast since making changes in the menu will consume a lot of time.
Q. If Yes, what changes do you make in your breakfast menu?
Ans.
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Q. Do all the family members eat the same breakfast?
Ans. No. Each person has its own preference and eats accordingly.
Q. Are you or anyone in the family, a health-conscious person?
Ans. Apart from my mother, none of my family members are particularly health conscious.
Q. What role of convenience do you see in breakfast?
Ans. To me, it plays the most important role.
Q. What role of nutrition do you see in breakfast?
Ans. I have never thought of eating breakfast according to its nutritional value hence I do not
consider nutrition to have an important role.
Q. What’s your reason for buying breakfast cereal?
Ans. I prefer breakfast cereals due to its taste and ready to eat factor.
Q. With what attribute do you associate cereals with?
Ans. Healthy and tasty
Q. First thing that comes into your mind when hearing Cereal?
Ans. Sweet dish
Q. Do you buy Rice, Corn, Wholegrain, or Oat cereals?
Ans. Mostly Oat Cereals
Q. What are the health benefits of cereals according to you?
Ans. There are many benefits but I never thing about it
Q. Do you think doctor’s guidelines are important before cereal consumption? Can diabetic
and non-diabetic alike people consume it without hesitation?
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Ans. Yes, I believe it is better to consult a doctor before consuming cereals, just to be safe.
Regarding diabetic patients, I have no idea and would again recommend that consulting
doctors is better option.
Q. Do you read ingredients label when making a purchase?
Ans. no
Q. Do you think it is useful for weight reduction, blood pressure maintenance?
Ans. no
Q. What factors do you consider in making a selection for breakfast cereal?
Ans. To me being a recognized and international brand is the most important factor which
would make me prefer a breakfast cereal.
Q. What specific brand do you purchase and the reason to choose that brand?
Ans. I mostly prefer Kelloggs because it is the most internationally known brand all over the
world, however I will not say I am loyal to any particular brand.
Q. What variant do you purchase usually?
Ans. Oat Cereals/ K Red Berries and Chocos
Q. Do you make a repeated purchase of the same variant or change it often?
Ans. Most of the time I purchase the same variants, however, sometimes I try out new
variants as well.
Q. How much role a price plays in choosing a cereal?
Ans. For me, price does play an important role in choosing a cereal.
Q. How much role variants play in choosing a cereal?
Ans. When purchasing cereals, my focus is on taste, hence for me, variants do not play a very
important role.
Q. Are you brand conscious or price conscious?
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Ans. I am mostly price conscious.
Q. What factors would lead you in switching to another brand?
Ans. Variety and price
Q. Have you ever faced any problem related to cereals?
Ans. No
Q. How often do you purchase it?
Ans. Monthly
Q. How often do you consume it? Daily/ weekly, etc.?
Ans. 3 or 4 days weekly
Q. At what time of the day do you consume it?
Ans. Mostly at breakfast
Q. Is this the only breakfast you do? Or is it usually consumed with other food?
Ans. This is usually the only breakfast I do, however sometimes to change the taste a bit, I eat
it with Nutella as well.
Q. Do you like to buy it from big stores or general trade?
Ans. Big stores
Q. Does packaging impact your decision for purchase? Do your children pester you to buy
particular brand which you might not have otherwise? What made children pester you? Was
it colorful packaging or any advertisement they might have seen?
Ans. Packaging has some role in my purchase decision as I usually like to purchase those
cereals whose packaging make it easier to store in my shelf. However, ultimately the decision
falls to my children, who are not concerned with the ease of storage, but rather by the colorful
images and pictures on the packaging. Hence, I have to purchase whatever they like, even
though it might be difficult to put on shelf or in cupboard.
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Q. Have you ever heard of Falak rice?
Ans. Yes. It is one of the best rice brands in the country.
Q. Have you ever consumed Falak rice?
Ans. Yes, many times.
Q. How do you perceive Falak rice in terms of reputation?
Ans. Falak has a good reputation in the market.
Q. If Falak launches breakfast cereals, how likely are you to make a purchase?
Ans. I might purchase it; however, it will ultimately depend on their product quality.
Q. If they offer breakfast cereal at a lower price, would you buy it then? (IF NO TO ABOVE
QUESTION)
Ans. Not applicable
Q. Do you have any complaints regarding the brand Falak?
Ans. No. I am very satisfied with its rice.
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APPENDIX H-1: THEMATIC ANALYSIS – MALE STUDENT
Themes Dialogues
Attributes • Healthy and tasty
Brand Experience • To me being a recognized and
international brand is the most
important factor which would make
me prefer a breakfast cereal.
• Kelloggs or any other International
product
Loyalty • I mostly prefer Kelloggs because it
is the most internationally known
brand all over the world, however I
will not say I am loyal to any
particular brand.
Purchase Intention • I prefer breakfast cereals due to its
taste and ready to eat factor.
Willingness to pay • For me, price does play an
important role in choosing a cereal.
• When purchasing cereals, my focus
is on taste, hence for me, variants do
not play a very important role.
• I have never thought of eating
breakfast according to its
nutritional value hence I do not
consider nutrition to have an
important role.
Usage Pattern • 3 or 4 days weekly
• Mostly at breakfast
Purchase Pattern • The grocery shopping is done by my
mother once a month.
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APPENDIX I: FOCUS GROUP – FEMALE STUDENTS
LOCATION: IBA KARACHI CAMPUS
MODERATOR: HERA NISAR
ASSISTANCE: AHSAN AHMAD
NUMBER OF PARTICIPANTS: 9
DATE: 25TH DECEMBER, 2017
DURATION: 45 MIN
Moderator: Let’s give you a brief introduction: The purpose of this Focus Group is to understand
the behavior of people towards breakfast and our main product is cereal and I would not be
disclosing the name of the company for which we are conducting the Future Group to avoid the
biasness that would result. This is my introduction I would like you to introduce yourself your
name your age and where you are from.
1. Shadab. I am 21 years old and I am from Hyderabad.

2. Sarah I am also 21 years old and I am from Hyderabad
3. Barera. I am also from Hyderabad
4. Taniya. I am 20 years old in Hyderabad
5. Varisha. I am 21 year old I am from Dubai
6. Bhaktawar. I am 21 years old and I am also from Hyderabad
7. Therem. I am from Lahore and I am 19 years old
8. Asma. 21 years old from chakwal
9. Shumail. I am 21 years old I am from Saudi Arabia
Moderator ok this is nice to meet such young pretty beautiful ladies. A little bit on the
background that normally we belong to a country where we have desi breakfast and the breakfast
that's closer to American breakfast lifestyle so we're looking forward to young audiences you guys
are exposed to internet or traveled so you guys have a different opinion then the old people that is
why we have selected you guys you have seen the world from Hyderabad to chakwal and from
Saudi Arab Dubai from Lahore
Q how many family members you have what are their ages and who does the groceries these
are the three question you need to answer
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Participant: 9 to 10 numbers around my mother and my brother do the grocery of like monthly
and our household income is 15 to 16000 my brother is in 13 and my mother is around 60 years
Participant: my house also contain 6 members they include my father my mother and my two
sister and my grandmother. Moderator other question is who does the gross and the one doing
the grocery what is their age.my parents my father do the grocery my father is 45 + and so is my
mum
Participant: I have five members in the family and my Ammi do the grocery and he is around 50
Participant: My mother is 40 years she does all the grocery and we have 5 members
Participant: I just have a brother my mother does the grocery and she is 50.
Participant: We are three siblings and two parents and my parents do the grocery and they are
around 40 and 50 in between
Participant: same we are three siblings and my mother does all the grocery and she is 45 +
Participant: we have 5 family members including my two brothers my parents my father does the
grocery and he is 42 years
Participant: my family members are 8 member I have 5 other siblings so my parents to the grocery
mostly
Moderator: so the trend here is that the mothers or the parents do the groceries for all the people
and they are the one who mostly take the decision
Participant: but we are living in a hostel so we go by our own decision to buy groceries as well
Moderator: definitely that would be a good point to carry on a discussion with that what
would you prefer to have in the breakfast do you guys prefer having breakfast, or do you
skip it, do you think it's an important meal of the day
Participant: I think it is important and I would prefer eggs and bread to parathas sometime.
Moderator: now the floor is open anybody can answer the question
Participant: it's important meal of the day especially when you have classes on the day so you
need proper breakfast to go and be prepared for the lectures
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Moderator: alright and so is there anybody who thinks that breakfast is not important
and they don't want to have it
(all point towards Sara) Sarah: I don't think it is not important but I can't eat anything early in the
morning
Moderator: so sorry you cannot deny the consensus. So Sara we would be asking you more often
since you do not have breakfast what do you think about its importance. Has your
mother scolded you that you not having breakfast.
Participant: She used to force me to eat something before I go to school but then I got into a habit
of skipping it. After I came to the hostel I usually sleep around that time when everyone has their
first or I just had my first meal at 1.
Moderator: so most of you not spoken I assume you guys prefer and you like heavy breakfast
or light breakfast
Participant: I have cereal for breakfast every morning
Participant: I take heavy breakfast because usually I skip lunch then I take dinner so I usually
take heavy breakfast so that I could go through the day
Moderator: from what I get is that you are health conscious.
Participant: Not really but I am busy entire Day I have consecutive classes or I have to go
somewhere so I usually skip lunch just have a juice or something to go through the day
Participant: I have cereals I have got cheese peanut butter and bread but usually I have cereal in
the breakfast
Moderator: does IBA offer of a cereal in the breakfast.
Participant: no we have desi nasta here like paratha Ande etc
Moderator: how many of you go out and buy cereal because it is not served here.
Participant: I go out and buy cereal like chocos not even the healthy one
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Moderator: so when you are going out to buy cereal what is in your mind is it the taste buds
that are compelling you to buy because you have been brought up like that and also it is a
very quick breakfast as compared to taking out bread or milk you know making a toast or
something so I prefer having cereal
Participant: I used to have cereal for like 1 year straight and it was a time when I was health
cautious so I used to eat cereal in the breakfast and in the dinner
Participant: I used to have a nice lunch I used to take healthy Kellogg's special K weetabix but
then the taste itself got blend and I got really tired of it and I couldn't find any health cereal with
different taste and flavor so I stopped using it just because I felt very bland and tire of it.
Moderator so what I see is that do we have a consensus of the fact that people health
conscious who go for cereals apart from you who go for Chocos do you have a special brand
let you go for
Participant: not really its either Kellogg's or Nestle or maybe sometimes fitness.
Participant: I guess because the desi nashta we take are oily and heavy they are full of carbs if
someone is looking for good health and they are trying to become healthy they would switch to
cereal
Participant: desi nasta is also regarded healthy like eggs and toast. and also the taste does not
get blend.
Moderator: alright so those who like cereals what is specific brand do you look for and is
there any specific reason why you go out and get yourself a cereal and not have breakfast
here ( IBA).
Participant: I like eating with weetabix a lot Kellogg's all Bran and special k i Switch between
these two cereals navigate I look for like healthy cereal whenever I choose not really health
conscious I like the choco ones but I don't die because I know I would get fat.
Moderator so you are health conscious that's why you go for the cereals that would not be
chocolatey and doesn't have sugar in it. Also are you not tired of consuming one cereal
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Participant: I used to have all the choco once before I came here because I used to live with my
brothers and sisters. they have their own choice of cereals. then when it was started buying
different ones
Moderator: most of you have been consuming previously. Either you were being influenced
by your parents or siblings. So how many of you made an independent decision in IBA to
buy cereals.
Participant: the thing is childhood attachment to cereals like we have grown up on cereal. Cereals
for breakfast throughout your school life like she mentioned the Coco pop. Cereal, the one with
the tiger the frosties that's like part of people’s childhood
Moderator: so now tell me your mother's working or is she a housewife.
Participant: yeah my mother is working women. (Nearly all cereal consuming people had
working mums).
Moderator: so this is how you guys grew up for instance it's like a quick breakfast. So can we
perceive cereal or a quick breakfast which is also healthy and we can we associate this with
cereal
Participants: yes
Moderator: so I would now ask one by one that when we talk about cereals what one
sentence comes to your mind when we are talking about cereals. You can say nothing about
it. It’s totally fine.
Participant: I would say nothing because I don't consume cereal.
Moderator: so if you see it in the market when you feel like it is not necessary to consume it
Participant: yes
Participant: I am not a cereal person I prefer Nutella over cereal
Participant: tasteless
Participant: good alternative
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Participant: I think it is just for children it is not for adults to eat. For some reason I think of it
like that
Participant: quick and healthy
Participant: tasteless and bimaro khana
Participant: it is a substitute for desserts
Moderator: taking your arguments forward do you think it can be consumed at any time of
the day
Participant: yeah it is very convenient it can even be used as a snack if you want to have light
snack throughout the day
Moderator: and what about you who doesn't have breakfast can you consume cereal at any
time of the day
Participant: well no because there is another thing with cereal that you have to consume it with
milk and I don't really like milk.
Participant: can be considered healthy because you consume milk with it you feel healthy
person anyways even if you are consuming chocolate cereal or any type of cereal
Moderator: so when we are talking about people living in hostel the difference between the
customer and consumer is not there because the people who are the customer are the one who are
consuming so I don't think there is no difference you guys are buying for yourself
you guys said you associate your childhood with cereal. Any other emotional attachment you
might have
Participant: there was a phase which I was going through to become healthy so I think I was so
attached to that cereal that I used to eat it day and night. I had a consciousness that it was making
me healthy. The feeling was for the entire year.
Moderator so anybody in your family who was diagnosed with with a disease in which they
would be consuming cereal like sugar or cholesterol
Participant: so my grandma had sugar so all her my mum Prefer cereal.
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Moderator so is that on doctor's prescription on
Participant: it was on doctor's prescription
Participant: my maternal grandfather uses cereal. Many people in our house consume that's not
brought up.
Moderator so you mentioned your maternal grandfather and you mentioned sick
people consuming cereals can we associate cereal with old people or people who have no teeth
and the children only they can consume cereals
Participant: no
Moderator: so the brand you have the brand your Nana has is it the same
Participant: they are exactly the same and in fact the flavor the same me and my grandfather
have the same taste preference. my siblings have a different taste preference.
Moderator: so you eat because it is healthy and he eats it because of his age
Participant: I also like it because of its taste. I eat all bran taste of Kellogg's
Moderator: so when you're talking about cereals does any particular brand come to your
mind.
Participant: fruit loops brand of Kellogg
3 people Nestle 6 people Kellogg's
Moderator is Kellogg's dominating because of the taste is it because of the shelf life it is on
the shelf available
Participant: it is because Kellogg's has a lot of flavors to offer and a lot of variety you see on
changed a lot of Kellogg's flavors. All you can see is Kellogg's on the shelves.
Participant: also Kellogg's has a nice packaging it has a rooster on its box so it makes it easy to
Remember. Also you associate rooster as a symbol with morning and breakfast.
Participant: also when you talk about Nestle then they have other products but Kellogg's is
known only for cereals it is Pioneer it is specializing.
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Moderator so when you buy cereal how much you would be willing to spend on the box of
cereal that would be enough for you in a month
Participant: in a month it takes only 2 large boxes and approximately 300 to 400.
Participant: 500 a box and I consume a lot of cereal. 4 To 5 boxes a month
Participant: I prefer buying small boxes because there easier to store in our room. I would spend
300. I don't consume cereal more often this is enough for me in a month.
Participant: I haven't bought any cereal from here I brought my whole stop from Dubai. I don't
stick to one particular brand I keep switching it up. I try fitness honey and almond but I keep
coming back to chocos
Moderator: in future you might become wives how much would you be willing to spend on
cereals.
Participant: 500 to 1000 in a month.
Participant: I would spend as much as my family requires because they like it and it is
healthy. Also it is easier to prepare so why not
Participant: around 1000 Per month.
Moderator: so do you guys think cereal are overrated
Participant: no
Participant: I think we should not only rely on just cereals but we should also things like boiled
egg because I think is not a complete nutrition
Participant: I consume a lot of serious for years but I did not lose much weight
Moderator: have you heard of the brand MATCO and Falak
Participant: yes we have heard the name of Falak but not Matco. Falak is a Rice Brand.
Moderator: So why are people from Middle East answering that they know Falak. Does
Nobody Else from Pakistan recall it. Probably because they export more that's why I'm
asking.
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Participant: we have not seen any advertisements and we have not seen it on the shelves in
supermarkets.
Moderator: are you aware of the brand guard.
Participant: yes we are aware of it
Moderator: do you guys consume brown rice.
Participant: no
Moderator: when you buy your cereals do you read the label on the packaging.
Participant: yes I was concerned about my health so I used to read the label
Moderator: in the US people are concerned about the sugar content of cereals so not a lot
of people consume cereals
Participant: yes sugar can be harmful but cereals are meant to be a quick convenient breakfast
solution so sugar helps to boost your energy as well
Moderator: if falak launched the cereal under its name what would persuade you to buy it.
Participant: positive word of mouth if someone tells me that it is healthy and tasty then I would
definitely try it
Participant: I think brand does matter as we are loyal to a certain cereal brand it won't be easy
for us to shift to another local brand
Participant: if the price of this new brand is lower then I would like to try it. When I buy cereal
I am concerned about the price it has to be affordable
Moderator: if you are asked to taste a Cereal at BTL activity would you buy a box right
there and then to try it
Participant: yes because flavor matters the most to me
Moderator: will you guys prefer a local Brand over an imported one
Participant: yes I associate imported brands with good quality so I will definitely prefer an
imported brand
Moderator: does the type or size of store matter from where you buy cereals
Participant: no it doesn't really matter we will even buy it from a general store
Moderator: many people are of the opinion that Cereals are meant to be for kids because of
their advertising and packaging
Participant: yes because if we look at the advertisements they are usually targeting kids
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So I think the company should focus on their advertising because it matters a lot if you want to
attract new customers
Even if your sampling is not good enough people might still want to buy your product because
you're advertising was strong enough
Moderator: now I turn to the non-consumers of cereal and ask them if they would start
buying cereal if the price was lower
Participant: yes I would buy a cereal if it was offered at a lower price because a bulk of our
expenses related to groceries.
Moderator: this is the last question before we wind up should cereals be consumed with
Hot milk or cold milk
Participant: it should be consumed with cold milk not with hot milk because Hot milk destroys
the taste of cereal
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APPENDIX I-1: THEMATIC ANALYSIS – FEMALE STUDENTS
Themes Dialogs
• Variety in taste. I shift to other variant because overtime it gets

blend
Attributes • Reduces weight
• Reduces cholesterol
• Easy to digest
• It should be crispy. Sogginess is bad
• Imported brand is genuine
Brand Experience • Local brand cannot be easily trusted with quality
• Imported brands have more variants
• If my grandparents and parents were using it then I should use it

Loyalty • Grown while seeing a particular brand so more loyal to it
• Taste needs to be good

• Kellogs is famous because it offered more variety. After
Purchase Intention sometime taste gets blend and there is a need to change it
• It should be good value for money and yes I am price sensitive
• I refer smaller packages because they are easy to store
• I am rice sensitive and if a similar quality of roduct and in
Willingness to pay varieties is available then we are willing to try it
• It can be consumed at any part of the day

Usage pattern • It is convenient to make and consume
• It should be consumed cold
• Ease of availability is important

purchase pattern • Bought it once a month
• I bought it from abroad and brought it to Pakistan with me.
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APPENDIX J: IN-DEPTH INTERVIEW – FEMALE STUDENT
LOCATION: IBA Karachi

INTERVIEWER: Hashir Sohail
INTERVIEWEE: Syeda Durdana
TIME: 5:30 to 6:00pm
Interviewer: First of all we will start with your family information, how many members are
there in your family and what is the median age in your family?
Durdana: The median age of the family is 30 yrs. There are eight family members in the
interviewee's family.
Interviewer: Who is the decision maker in your house when it comes to making purchases
and who makes grocery purchases?
Durdana: My mother is the decision maker in the house and she was a working woman but
is now retired. Household grocery is done by the males of the house and sometimes I myself
go out to buy grocery.
Interviewer: Where do you buy your groceries from and how frequently is grocery
purchased in your household?
Durdana: Grocery is purchased from the supermarket or hypermarket every month.
Interviewer: Is breakfast considered to be an important meal of the day in your house?
Durdana: Priority is given to breakfast in our household. Breakfast is seen as important for
health and porridge and boiled eggs are regularly consumed by us considering their health
advantages.
Interviewer: What kind of breakfast do you prefer?
Durdana: I use porridge regularly for breakfast.
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Interviewer: What do you associate breakfast with?
Durdana: I associate breakfast with health and nutrition. I pay attention to the nutritional
value to be provided by the breakfast such as proteins etc. I associate the consumption of
porridge with convenience as well because it is easy to prepare in the morning before leaving
for work. Another reason for consuming porridge is that there have been innovations in this
product. Porridge is no longer tasteless and it comes in various varieties now with chunks of
fruit in it as well, so, now porridge is available in tasty variants. My colleagues at office also
prefer taking porridge as it is full of nutrients and light as compared with normal traditional
breakfast which can be very heavy for the system and you do not feel good the whole day.
Interviewer: Do you prefer a particular brand of cereals?
Durdana: I prefer barley porridge available in normal unbranded packaging and not of a
specific brand as it tastes better than the branded ones and the quality is good as well. In the
beginning I preferred the barley porridge of Fauji and another UAE brand I cannot recall the
name of but when I tried out the normal packaged barley available at supermarket which my
mother bought I shifted to it because of its better taste. For this normal barley you have to
first cook it and then consume it but branded ones can be consumed directly with hot milk
so I myself would prefer the branded barley where as my mother prefers the unbranded one.
So the question of choice depends on age too.
Interviewer: Is price a concern for you when you purchase a cereal?
Durdana: Price is not a big concern for me. Quality drives my decision to buy a porridge
cereal. If the same quality product is available at another supermarket at a lower price than
I would prefer to buy it from that supermarket.
Interviewer: Do you prefer to consumer cereal with hot or cold milk?
Durdana: I prefer cereals to be consumed with hot milk. I think that this choice also depends
on age. Kids in my house would like to eat cereals like coco pops with cold milk but I would
prefer cereals with hot milk.
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Interviewer: What do you think about the cereals of international brands available in the
market?
Durdana: I think that cereals by kelloggs and nestle are aimed at kids and their advertising
is also focused on kids. And people at my age are more weight conscious and health conscious
so they stay away from these sugary cereals and prefer to eat cereals like barley. I think that
cornflakes are outdated and I prefer porridge because they are now coming in variants that
contain fruit chunks and nuts in them. Cornflakes feel like they are made for patients.
Interviewer: Have you ever tried a rice cereal?
Durdana: I have never seen a rice cereal on the shelves of supermarkets. Packaging and
advertising of cereals by kelloggs and nestle is aimed at kids so it doesn't appeal to me.
Interviewer: Have you used falak rice and what is your perception of falak rice?
Durdana: Falak rice holds a good perception in my mind and it is a good quality rice
according to me. It has all the qualities I look for. It is long and it does not break up when it
is cooked and it tastes better than other rice.
Interviewer: If Matco launches a cereal, should it launch it with the same name falak or any
other name?
Durdana: I think that if Falak launches a cereal with the same name I would definitely
purchase it for trial but in order for me to repurchase it, the cereal would have to be of high
quality meeting all standards. Even if they keep the price in the premium range I would buy
it as long as the quality is good.
Interviewer: Thank you for your time.
Durdana: No Problem.
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APPENDIX J-1: THEMATIC ANALYSIS – FEMALE STUDENT
Themes Dialogs
• I associate cereal with health and nutrition.

• I associate the consumption of cereal with convenience.
• Ease of use.
Attributes • Weight control.
• Gets soft in hot milk.
• Even unbranded/locally available cereal is of good quality.
Brand Experience • Branded cereal is easy to use.
• I am loyal to unbranded porridge. If a new brand comes out with

exceptional quality I might consider shifting.
Loyalty
• It should be of good quality.
• It should have a good taste.
• Nutritional value mentioned on packaging.
Purchase Intention • New variants of porridge.
• Price is not a big concern for me. Quality drives my decision of
purchasing a cereal. If the same quality cereal is available at a
Willingness to pay
lower price at another supermarket then I would prefer buying
from there.
• I consume it I breakfast every day.

Usage pattern
• I buy cereal once a month, every month.
Purchase pattern
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APPENDIX K: FOCUS GROUP – CHILDREN
LOCATION: ANEES HUSSAIN
MODERATOR: HASHAM ZAHID
ASSISTANCE: ANEEQ IMTIAZ
DATE: 25TH JANUARY, 2017
DURATION: 21 MIN
Moderator: Introduce yourself and tell us about your family members
Respondent 1: I have 5 family members and my name is Zuriya.
Respondent 2: I have 4 family members and my name is Sara
Respondent 3: I have 5 family members and my name is Amna
Respondent 4: 5 members including me, name is Hamza
Respondent 5: 7 family members and my name is Ali
Respondent 6: I have 6 family members and my name is Sajid.
Moderator: Is the eldest female member in your family working women or housewife?
Respondent 1: Housewife
Respondent 4: Working woman
MODERATOR: Who does grocery in your house and how often?
Respondent 1: Mom and once in a month
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Respondent 2: Me and my dad, once a month
Respondent 3: Me and my mom, twice a month
Respondent 4: My mom, twice a month
Respondent 5: My mom and dad, twice a month
Respondent 6: My mom, once a month
MODERATOR: Now we will talk about breakfast, so at what time do you have breakfast?
Respondent 1: 6:30am
Respondent 2: 9am
Respondent 3: I don’t have breakfast
Respondent 4: 9-9:30 am
Respondent 5: 7 am
Respondent 6: 7:30 am
MODERATOR: Those who don’t have breakfast, why do you skip it?
Respondent: umm I don’t feel hungry.
MODERATOR: Do you feel breakfast is important for us?
Respondent 1: Yes
Respondent 2: Yes
Respondent 3: I guess it makes you nauseous for the rest of the day
Respondent 4: Yes
Respondent 5: Yes
Respondent 6: Yes
MODERATOR: Usually, what do you like to have in breakfast? And why?
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Respondent 1: Bread and butter
Respondent 2: Anything
Respondent 3: Cornflakes and pancakes
Respondent 4: a glass of milk
Respondent 5: chocolates
Respondent 6: Anything
MODERATOR: When you are having a breakfast, what is more important? Convenience?
Nutrients? Taste?
Respondent 1: Taste
Respondent 2: Taste
Respondent 3: Nutrients
Respondent 4: Nutrients
Respondent 5: Convenience
Respondent 6: Taste
MODERATOR: Do you like to have same breakfast in routine or do you change it?
Respondent 1: Change it
Respondent 2: Change it
Respondent 3: Changes it
Respondent 4: Changes it
Respondent 5: Routine
Respondent 6: Routine
MODERATOR: Do all your peers like to have the same breakfast?
All Respondent: No
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MODERATOR: Is anyone in your family a health conscious person?
All Respondent: Yes
MODERATOR: On a scale of 1-10, where do you see convenience in breakfast?
Respondent 1: 6
Respondent 2: 7
Respondent 3: 7-8
Respondent 4: 8
Respondent 5: 8
Respondent 6: 7
MODERATOR: On a scale of 1-10, where do you see nutrients in breakfast?
Respondent 1: 8
Respondent 2: 10
Respondent 3: 7
Respondent 4: 9
Respondent 5: 9
Respondent 6: 9
MODERATOR: Being a nonuser, how do you perceive breakfast cereals?
Respondent: I usually don’t like the taste of the cereals.
MODERATOR: What according to you is the role of advertisement in raising awareness about
cereals?
Respondent: I suppose, for some people it would tempt them to have cereals, but it wouldn’t
make any difference to me.
MODERATOR: What is the last advertisement you saw of any cereal?
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All Respondent: I don’t remember
MODERATOR: What brands come to your mind when we talk about cereals?
All Respondent: Kellogs
MODERATOR: What attributes come in your mind when we talk about cereals?
Respondent: Crunchy
MODERATOR: Do you believe cereals are more nutritious than the morning breakfast.
3 Respondent: Yes
2 Respondent: No
MODERATOR: If you have to take cereals, would you prefer a local brand or foreign brand?
Why?
Respondent: Foreign, because of the quality
MODERATOR: Do you believe foreign brands are made up of genetically modified

substances?
Respondent: Yes
MODERATOR: Would you be interested to consume the cereals at any other time of day
except for breakfast?
All Respondent: No
MODERATOR: Does price play any role in consideration of cereals in breakfast?
All Respondent: No, basically nutrients are important.
MODERATOR: Now coming to the users, are you a customer or consumer?
Respondent: Customer
Respondent: Customer
Respondent: Can you tell me the difference?
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MODERATOR: Customer is the one who buys, and end user is consumer.
Respondent: Consumer
Respondent: Consumer
Moderator: Do you buy rice, corn, wholegrain or oat cereals?
Respondent 1: Oats
Respondent 2: Oats
Respondent 3: Wholegrain
Respondent 4: Wholegrain
Respondent 5: Oats
Respondent 6: Oats
Moderator: Do you think doctors should be consulted before consuming cereals?
Respondent 1: No
Respondent 2: No
Respondent 3: No
Respondent 4: No
Respondent 5: No
Respondent 6: Yeah they should because of nutritional element involved in it.
Moderator: Do you read nutrition label before making a purchase?
Respondent 1: Yes
Respondent 2: No
Respondent 3: Yes
Respondent 4: No
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Respondent 5: Yes
Respondent 6: Yeah
Moderator: You think it’s useful for weight reduction and blood pressure maintenance?
Respondent 1: Yes
Respondent 2: Yeah
Respondent 3: I have no idea
Respondent 4: Depends on cereal
Respondent 5: No
Respondent 6: Yeah
Moderator: What factors do you consider when making a decision for breakfast cereals?
Respondent 1: It should be tasty.
Respondent 2: Taste
Respondent 3: Chocolate flavours
Respondent 4: Taste
Respondent 5: Chocolate
Respondent 6: Packing
Moderator: What specific brand do you purchase and why?
Respondent 1: I don’t purchase specific brand I keep shuffling.
Respondent 2: Kellogg’s or Fauji because I just like them.
Respondent 3: Koko krunch because it is chocolate.
Respondent 4: Koko Krunch
Respondent 5: Fauji
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Respondent 6: Kellogg’s
Moderator: How much role does the price play in choosing the cereals?
Respondent 1: It depends on pockets.
Respondent 2: It doesn’t really matter if you like it
Respondent 3: It’s on my parents such stuff so I don’t know
Respondent 4: Not really
Respondent 5: Doesn’t matter
Respondent 6: Nope
Moderator: How much do they purchase?
Respondent 1: one per month
Respondent 2: 2 packets for 1 month
Respondent 3: 4-5 small ones
Respondent 4: 1 packet for 3-4 months
Respondent 5: one for a month
Respondent 6: 2 For 3 months
Moderator: Do you consider yourself brand conscious or price conscious?
Respondent 1: Brand conscious
Respondent 2: Brand
Respondent 3: Brand
Respondent 4: Brand
Respondent 5: Brand
Respondent 6: Brand
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Moderator: What factors lead you to switch to other brands?
Respondent 1: Quality
Respondent 2: Taste
Respondent 4: better chocolate flavor
Respondent 6: Ingredients
Moderator: Have you ever faced any problems related to cereals?
Respondent 1: No
Respondent 2: No
Respondent 3: No
Respondent 4: No
Respondent 5: Yes. The box was ruined. The cereals were supposed to be crunchy but they
were soggy.
Respondent 6: 2 problems. Sometimes I don’t know how much rice to put in. Sometimes they
advertise more about health which actually aint.
Moderator: Do you consume it daily?
Respondent 1: Yes
Respondent 2: Yes
Respondent 3: Yes
Respondent 4: No
Respondent 5: No
Respondent 6: No
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Moderator: Do you consume it at breakfast or some other time of the day?
Respondent 1: breakfast
Respondent 5: Breakfast
Respondent 6: Breakfast
Moderator: Do you purchase it from big stores or general trade?
Respondent 1: Big stores
Moderator: Does packaging impact your decision for purchase?
Respondent 1: Yes
Respondent 2: Yes
Respondent 3: Yes
Respondent 4: No not really
Respondent 5: Yes
Respondent 6: Yes
Moderator: We are now moving to our last section. Have you ever heard of Falak rice?
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Respondent 1: I think I have
Respondent 2: Yes
Respondent 3: Yes
Respondent 4: No
Respondent 5: Yes
Respondent 6: No
Moderator: Those who have heard of Falak Rice, have you ever consumed it?
Respondent 1: No
Respondent 2: Yes
Respondent 3: yes I have
Respondent 4: No
Moderator: Those who have heard of it, how do you perceive Falak’s perception?
Respondent 1: It’s fine, but I prefer guard instead.
Respondent 2: Okay
Moderator: If Falak launches a breakfast cereal, will you make a purchase?
Respondent 1: Yes will try it
Respondent 2: No
Respondent 3: Yeah
Respondent 4: Most probably not
Respondent 5: Advertisement will affect my decision
Respondent 6: No
Moderator: If they offer cereals at a lower price, would you then purchase it
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Respondent 1: I think I would, but will think it’s not good in quality
Respondent 2: Skeptical
Respondent 3: I wouldn’t really appreciate it though
Respondent 4: No
Respondent 5: No
Respondent 6: No
Moderator: So even at a lower price you are not buying it
Respondent: because price doesn’t matter. I will always prefer quality over price
Moderator: Do you have any complaints regarding brand Falak?
Respondent 1: I haven’t used
Respondent 2: No actually it doesn’t cook quickly
Moderator: If a brand is launched, which one would you prefer wheat, rice, or oat?
Respondent 1: main ingredient should be wholegrain
Respondent 2: Wheat
Respondent 3: oat
Respondent 4: Wheat
Respondent 5: oat
Respondent 6: Oat
Moderator: Would you consume it with hot milk or cold milk?
Respondent 1: Hot
Respondent 2: Hot
Respondent 3: Cold
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Respondent 4: Hot
Respondent 5: Hot
Respondent 6: Hot
Moderator: But hot milk causes it to become it soggy
Respondent 1: Maybe normal hot
Respondent 2: I like soggy
Respondent 3: Sometimes I prefer crunchy
Respondent 4: If it is too crunchy I don’t think it will blend in well with the milk
Moderator: Thank you for your time here we conclude our focus group.
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APPENDIX K-1: THEMATIC ANALYSIS – CHILDREN
Themes Dialogues
Attributes: - • Crunchy
Reason for consumption • Taste

• Taste
• Nutrients
• Nutrients
• Convenience
• Taste
Foreign vs local: • Foreign, because of the quality
Brand attachment: - • I don’t purchase specific brand I

keep shuffling.
• Kellogg’s or Fauji because I just like
them.
• Koko krunch because it is chocolate.
• Koko Krunch
• Fauji
• Kellogg’s
Brand vs price consciousness: All are cereal users are brand conscious
Problems regarding cereals • No

• No
• No
• No
• Yes. The box was ruined. The
cereals were supposed to be
crunchy but they were soggy.
• 2 problems. Sometimes I don’t know
how much rice to put in. Sometimes
they advertise more about health
which actually aint.
Importance of Packaging (Does it • Yes
matter) • Yes
• Yes
• No not really
• Yes
• Yes
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Perception of breakfast cereals • I usually don’t like the taste of the
cereals.
• Haven’t though about it much
Usage Pattern (Daily Consumption) • Yes

• Yes
• Yes
• No
• No
• No
Consumption Habit • breakfast
• breakfast
• breakfast
• breakfast
• Breakfast
• Breakfast
Importance of convenience (rating out of • 6

10) • 7
• 7-8
• 8
• 8
• 7
Ad recall • I don’t remember
Purchase Pattern • one per month

• 2 packets for 1 month
• 4-5 small ones
• 1 packet for 3-4 months
• one for a month
• 2 For 3 months
Purchase Point • Big stores

• Big stores
• Big stores
• Big stores
• Big stores
• Big stores
Awareness of Matco • No
• No
• No
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• No
• No
• No
• No
• No
Awareness of Falak • I think I have

• Yes
• Yes
• No
• Yes
• No
Perception of Falak rice • It’s fine, but I prefer guard instead.
• Okay
Willingness to try Falak’s upcoming • Yes will try it

cereals • No
• Yeah
• Most probably not
• Advertisement will affect my
decision
• No
Complaints about Falak • I haven’t used it

• No actually it doesn’t cook quickly
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APPENDIX L - FOCUS GROUP - WORKING WOMEN
LOCATION: NORTH KARACHI
MODERATOR: HASHAM ZAHID
ASSISTANCE: ANEEQ IMTIAZ
DATE: 27TH JANUARY, 2017
DURATION: 37 MIN
Moderator: Assalam o Alikum, My name is Hasham Zahid and we are going to conduct a focus
group on breakfast cereals as a part of our MBA project. I would now like everyone to give a short
introduction about themselves.
Respondent 1: My name is Shafaq and I am a dentist.
Respondent 2: My name is Sabahat, I am currently working in Allied bank as assistant branch

manager.
Respondent 3: My name is Ruby, I am a doctor.
Respondent 4: My name is Fehmida and I am a doctor
Respondent 5: My name is Huma and I am a doctor.
Respondent 6: My name is Fariha, I am a teacher.
Moderator: Can you tell me about your family background, like how many members are in your
family, who is the decision maker, and what is their age?
Shafaq: Our family consists of 5 members. Since we live in a joint family and I am working most
of the time, hence my mother in law is the decisionmaker of the family. She is about 65 years old.
Sabahat: I also live in a joint family system. My family consists of 4 members and my mother in
law is the decision maker in the family. She is 62 years old.
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Ruby: My family consists of 2 members, me and my husband. Both my mother in law and father
in law are deceased, hence me and my husband go for grocery shopping, however, I am the primary
decision maker. I am 50 years old.
Fehmida: Currently there are only two people living in the house. I have a son who is married, but
he is working abroad along with his family, so it is just me and my husband. I am 58 years old.
Huma: My family consists of 5 members. I have three kids, all of whom are studying in college. I
am the decision maker in the family.
Fariha: My father in law and mother in law are deceased, hence it is just me, my husband and 2
daughters. I am 45 years old.
Moderator: Do you eat breakfast regularly or do you skip it?
Shafaq: We never skip breakfast no matter what, even if this means getting up at 6 pm.
Sabahat: I sometimes tend to skip breakfast when I am getting late, but I try most of the time to at
least eat something before going for work.
Ruby: My routine is also similar, even when I am not able to eat a proper breakfast, I still try to
eat something, either before leaving the home, or on my way.
Fehmida: I tend to skip breakfast most of the time, as I don’t have much time to prepare it.
Huma: I eat breakfast regularly, as I have to prepare it anyways for the kids, so I eat it regularly
with them.
Fariha: Same is the case with me. I have to prepare it for my daughters, hence I do not skip it.
Moderator: Okay. What according to you is the importance of breakfast?
Shafaq: In my opinion, breakfast is the most important meal of the day as it provides the initial
energy to start the day.
Sabahat: I would also agree with Shafaq. Breakfast is very important, and when I don’t eat
breakfast, I feel very lazy and become hungry very quickly, at around 10. Hence, I always try to
eat breakfast.
Ruby: Yes, breakfast is very important, as it provides numerous benefits to health.
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Fehmida: I also believe breakfast is an essential meal for a day, however, now I have gotten so
used to not having breakfast that I don’t feel the need for it.
Huma: Being a doctor, I know that breakfast has a lot of benefits and it is not good to leave it.
Fariha: I also consider breakfast to be an important meal of the day.
Moderator: what kind of breakfast do you prefer?
Shafaq: I mostly anda paratha with milk.
Sabahat: Anda paratha, with chai. Sometimes, cereals.
Ruby: I eat a varied breakfast. Sometimes it is bread and butter, some times it is egg and paratha,
and when I am getting late then it is cereals.
Fehmida: I don’t eat breakfast.
Huma: Eggs and paratha or K&N’s nuggets and bread.
Fariha: At home, I don’t usually consider healthy option. I eat anda paratha and sometimes fried
eggs. In winter, I eat saag and on weekends I eat khullay channay
Moderator: Ok, If I give you 5 options to choose from what would you choose? Convenience?
Nutrition? Taste? Heavy breakfast? Light breakfast?
Shafaq: My husband is a Navy captain; hence it is very important for him to have proper nutrition.
He is very health conscious hence I would choose nutrition’s.
Sabahat: On weekdays, convenience is more important to me, but on weekends I would prefer
taste.
Ruby: Convenience and nutrition
Fehmida: I skip breakfast because of time shortage, hence convenience would be most important
to me.
Huma: My kids prefer taste, while I prefer convenience.
Fariha: Convenience and Nutritution
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Moderator: Do all family members have same breakfast or are there varieties according to
preference?
Shafaq: No, we all have different breakfasts.
Sabahat: Different breakfasts.
Ruby: Since there are only two people, hence it is mostly the same breakfast.
Fehmida: Same with me. When my son was here, he always used to demand different things, but
now that he is abroad, it does not make sense to prepare different things just for two people.
Huma: Well it is completely opposite for me. All my kids want different things to eat and
sometimes I oblige them and sometimes I just scold them and make them eat the same thing.
Fariha: It is usually same for the entire family.
Moderator: Is there anyone in your family health conscious? Or is your entire family health
conscious?
Shafaq: Oh yes, as I mentioned earlier, my husband is in Navy and very particular about what he
eats, and how much calories he takes. I on the other hand am not very much.
Sabahat: My father in law only eats food prescribed by the doctor.
Ruby: Me and my husband both eat same food.
Fehmida: My husband is also a doctor, and he is very health conscious.
Huma: No one.
Fariha: I am very health conscious.
Moderator: If you were to rate convenience on the scale of 10, where 10 being most important.
How would you rate?
Shafaq: 6
Sabahat: 7
Ruby: 7
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Fehmida: 8
Huma: 8
Fariha: 8
Moderator: The next part if for non-users. The first question is how do you perceive breakfast
cereals?
Shafaq: I don’t it is very nutritious, and I also don’t like how they look. They seem very artificial.
Fehmida: I also think that breakfast cereals are not an alternate to a proper breakfast.
Moderator: Why don’t you consume cereals? Is there any reason?
Shafaq: It seems very artificial, while I prefer natural.
Fehmida: I just don’t eat at breakfast time.
Moderator: Do you remember seeing any recent campaign of Cereals?
Shafaq: No
Fehmida: I can’t remember
Moderator: What is the first thing that comes in your mind on hearing cereals?
Shafaq: Very expensive. Waste of money
Fehmida: Convenient and readymade food
Moderator: What associations have you made with breakfast cereals?
Shafaq: Non-nutritious food with bad taste
Fehmida: Easy to cook.
Moderator: Do you think it is more nutritious than other options you have?
Shafaq: Definitely not.
Fehmida: I don’t know much about nutrition but they can be a good alternative for people who
have to go to work early.
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Moderator: If you have to choose between one foreign brand and other local brand, which one
would you prefer and why?
Shafaq: Foreign. As they have a better standard of quality.
Fehmida: Same as Shafaq
Moderator: Let’s assume you are short of time and you want to have a convenient breakfast with
many options and cereal being one. What would you prefer?
Shafaq: If convenience is the only issue, then I might consider it.
Fehmida: Yes, I might also consider it if it is convenient.
Moderator: Any factor that will make you the user of cereals?
Shafaq: It is very hard for me to consider it right now. If somehow, they are able to convince me
that cereals are very beneficial for health, then maybe I will consider it.
Fehmida: Taste should be good.
Moderator: I will now start with the users. Are you a customer or consumer? Or both?
Sabahat: Both
Ruby: Both
Huma: Both
Fariha: Both
Moderator: Your reasons for consuming breakfast cereals?
Sabahat: Easy to cook and tasty
Ruby: For convenience
Huma: Convenience and children like it too
Fariha: Convenience
Moderator: What are the attributes you associate with cereals?
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Sabahat: A luxury product
Ruby: Good alternative for breakfast
Huma: Easy to prepare
Fariha: Should be of good quality
Moderator: Since you guys are the users, you know there are multiple option to pick from like
corn, oat, wheat and rice. Which one would you prefer or indifferent?
Sabahat: I prefer oat.
Ruby: Oat.
Huma: I am indifferent.
Fariha: I like wheat.
Moderator: What do you think are the health benefits of breakfast cereals?
Sabahat: I am not very sure about it. I don’t know
Ruby: It might be helpful in losing weight
Huma: There might be some benefits but I am not very sure about it.
Fariha: I don’t know.
Moderator: Have you ever read ingredient labels or just consumed it without reading?
Sabahat: I don’t read labels.
Ruby: I read labels when trying out a new variant.
Huma: Yes I also read labels.
Fariha: Me too.
Moderator: Do you think cereal consumption helps in reducing weight and maintaining blood
pressure?
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Sabahat: People say it does but I don’t know.
Ruby: Yes as I said earlier that it might be helpful in losing weight
Huma: It can help in maintaining a good diet but I am not very sure about maintaining blood
pressure
Fariha: I have no idea.
Moderator: You are both customer and consumer, so what factors you consider when making a
purchase?
Sabahat: Price and taste
Ruby: Price and variants
Huma: Ease of storage due to package shape, taste, price
Fariha: Price, taste and nutrition
Moderator: What specific brand do you purchase and reasons for choosing that?
Sabahat: Mostly Nestle because of taste
Ruby: I keep switching between different brands
Huma: Kelloggs
Fariha: Kellogg or Nestle
Moderator: Do you go for repeated purchases or new variants?
Sabahat: Mostly repeated
Ruby: I try out new variants
Huma: Repeated purchase
Fariha: Mostly repeated
Moderator: How much role a price plays in choosing a cereal?
Sabahat: For me it matters a lot
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Ruby: Not much. I am more inclined towards variety.
Huma: It matters for me
Fariha: Not very much
Moderator: Are you brand conscious or price conscious?
Sabahat: Brand
Ruby: Brand
Huma: Brand.
Fariha: Brand
Moderator: How much role does variant play in decision?
Sabahat: I like to try new things hence it matters a lot to me.
Ruby: Doesn’t matter a lot to me.
Huma: Not a very great impact on my decision.
Fariha: Having a variety will make me want to purchase a brand, but ultimately it will depend on
the quality.
Moderators: What factors will make you switch to other brands?
Sabahat: If the taste is good and price is reasonable.
Ruby: Good taste
Huma: Nutritional value should be high, as I like to provide good food to my children
Fariha: Yes nutritional value and taste are very important.
Moderator: Have you ever faced problem related to cereals?
Sabahat: No
Ruby: No
Huma: Packaging because sometimes it gets difficult to store due to the shape of the packet.
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Fariha: No issues
Moderator: How often do you purchase it?
Sabahat: twice a month
Ruby: Once in a month.
Huma: Twice a month
Fariha: Twice a month
Moderator: How often do you consume it?
Sabahat: twice or thrice a week.
Ruby: Twice a week
Huma: Three to four times a week.
Fariha: Around three times a week
Moderator: Do you have any specific time to eat cereals or eat at any time of the day?
Sabahat: Only breakfast
Ruby: Mostly breakfast.
Huma: Breakfast.
Fariha: Breakfast and sometime when I come from after school and in need of a light snack
Moderator: Do you consume cereals with something or separately?
Sabahat: Cereals and sometimes with milk
Ruby: Ceraels.
Huma: Only cereals.
Fariha: Cereal and milk
Moderator: Last question of this section is whether you purchase it from LMTs/IMTs or General
Trades?
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Sabahat: Big malls.
Ruby: Usually from Imtiaz.
Huma: Small shop as they are close to my home
Fariha: Supermarkets
Moderator: Does packaging matter?
Sabahat: Not very much
Ruby: Not to me.
Huma: Yes since it will be easier to store depending on the shape of packaging.
Fariha: Not to me but my children get attracted by the cartoons. So, I often buy those cereals which
they want.
Moderator: In this last section of 5 minutes, I would be asking questions about a particular
company. First question is, have you ever heard of Matco Foods?
Shafaq: No
Sabahat: No
Ruby: No
Fehmida: No
Huma: No
Fariha: No
Moderator: Have you ever heard of Falak Rice?
Shafaq: Yes
Sabahat: Yes
Ruby: Yes
Fehmida: Yes
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Huma: Yes but I don’t use it.
Fariha: yes
Moderator: If you said Yes, then how do you perceive Falak rice?
Shafaq: It is of very good quality, I have mostly heard good things about it from shopkeepers too.
Sabahat: I think Falak is of excellent quality.
Ruby:
Fehmida: I think it is at par with Guard’s rice
Fariha: I think it competitive with international brands.
Moderator: Those who said they have heard of Falak, if they want to enter with the name Falak in
breakfast cereals then would you consider buying?
Shafaq: If it nutritious then I might.
Sabahat: I might.
Ruby: yes
Fehmida: Yes.
Fariha: Yes I will.
Moderator: Since you guys know about Falak, do you have any complains or reservations
regarding Falak, be it quality, price or distribution?
Shafaq: No.
Sabahat: No, I have always been satisfied with it
Ruby: No complaints.
Fehmida: No issues
Huma: No issues. I am very satisfied with it.
Fariha: Same here. No issues
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Moderator: Here, we conclude our focus group. I would like to thank each and every one of you
for the participation.
APPENDIX L-1: THEMATIC ANALYSIS – WORKING WOMEN
Themes Dialogues
Attributes: - • A luxury product
• Good alternative for breakfast
• Easy to prepare
• Should be of good quality
Reason for consumption • Easy to cook and tasty

• For convenience
• Convenience and children like it too
• Convenience
-
Health Benefits • I am not very sure about it. I don’t know
• It might be helpful in losing weight
• There might be some benefits but I am not very
sure about it.
• I don’t know.
-
Brand attachment: - • Mostly Nestle because of taste
• I keep switching between different brands
• Kelloggs
• Kellogg or Nestle
-
Willing to try new brands or • Mostly repeated
repeated purchase: • I try out new variants
• Repeated purchase
• Mostly repeated
Brand vs. price • All are brand conscious
consciousness:
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Preference for a certain • I prefer oat.
cereal • Oat.
• I am indifferent.
• I like wheat.
Problems regarding cereals No•
No•
•
Packaging because sometimes it gets difficult to
store due to the shape of the packet.
• No issues
Importance of Packaging • Not very much
(Does it matter) • Not to me.
• Yes since it will be easier to store depending on
the shape of packaging.
• Not to me but my children get attracted by the
cartoons. So, I often buy those cereals which
they want.
Perception of breakfast Non-users
cereals • I don’t it is very nutritious, and I also don’t like
how they look. They seem very artificial.
• I also think that breakfast cereals are not an
alternate to a proper breakfast.
Factors which might turn • It is very hard for me to consider it right now. If
somehow, they are able to convince me that
non-user into users
cereals are very beneficial for health, then
maybe I will consider it.
• Taste should be good.
Usage Pattern • twice or thrice a week.
• Twice a week
• Three to four times a week.
• Around three times a week
Consumption Habit • Only breakfast
• Mostly breakfast.
• Breakfast.
• Breakfast and sometime when I come from after
school and in need of a light snack
Do you consume cereals with something or

separately?
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• Cereals and sometimes with milk
• Ceraels.
• Only cereals.
• Cereal and milk
Importance of convenience • 6
(rating out of 10) • 7
• 7
• 8
• 8
• 8
Ad recall Non-Users
• No
• I can’t remember
Price point • For me it matters a lot
• Not much. I am more inclined towards variety.
• It matters for me
• Not very much
Role of variant availability • I like to try new things hence it matters a lot to
me.
• Yes. As I mentioned that I like to try out new
variants hence having more variants impacts
upon my purchase decision.
• Not a very great impact on my decision.
• Having a variety will make me want to purchase
a brand, but ultimately it will depend on the
quality.
Purchase Pattern • twice a month

• Once in a month.
• Twice a month
• Twice a month
-
Purchase Point • Big malls.
• Usually from Imtiaz.
• Small shop as they are close to my home
• Supermarkets
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Brand Switching Factors • If the taste is good and price is reasonable.
• Good taste
• Nutritional value should be high, as I like to
provide good food to my children
• Yes nutritional value and taste are very
important.
Purchase factors: - • Company, taste and price.
• I go for new variants and then price.
• Variants and price
• Brand and variant
Awareness of Matco • No
• No
• No
• No
• No
• No
Awareness of Falak • Yes

• Yes
• Yes
• Yes
• Yes but I don’t use it.
• yes
-
Perception of Falak rice • It is of very good quality, I have mostly heard

good things about it from shopkeepers too.
• I think Falak is of excellent quality.
• Falak’s quality is very good, and it is also very
easily available at most shops.
• Excellent quality product. I always use it when
cooking food.
• I have also found it to be an exceptional product
and would recommend it to everyone.
-
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APPENDIX M: FOCUS GROUP QUESTIONS
Person: 6 per FG (minimum)

Duration: 40 mins
Questions for: Employed women, Housewives, Children, and Students (Male and Female)
INTRODUCTION (5 mins)
Purpose of the focus group.
Brief introduction about the attendees. (Name, age, location)
BACKGROUND (5 mins)
How many family members constitute your household?
Family members and their ages?
Is the eldest female in your house a working woman or a house wife?
Who does grocery and how often?
BREAKFAST PREFERENCE (10 mins)
Do you like breakfast? Is it good if someone skips it?
What do you like to have in breakfast?
Why do you prefer that specific breakfast?
What’s more important when choosing breakfast? Convenience? Taste? Nutrition? Heavy
breakfast? Light breakfast?
At what time do you usually have breakfast?
Do you like changes in breakfast menu or you follow it in a routine?
If Yes, What changes do you make in your breakfast menu?
Do all the family members eat the same breakfast?
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Are you or anyone in the family, a health-conscious person?
What role of convenience do you see in breakfast?
What role of nutrition do you see in breakfast?
CEREAL PERCEPTION (Non-Users) (15 mins)
How do you perceive breakfast cereals?
Reasons for not consuming breakfast cereals?
What according to you could be the role of advertisement in raising awareness about benefits
of cereals? Do you recall any cereal advertisement?
First thing that comes into your mind when hearing Cereal?
What brand comes to your mind when hearing cereals?
With what attribute do you associate cereals with?
Is cereal nutritious than other morning breakfast?
If you have to eat cereals than would you prefer local brand or foreign brand? Why?
Do you think foreign brand might be made up of genetically modified substances?
It is convenient and nutritious, how interested would you be in consuming cereals?
Would you be interested to consume at any other time of the day?
Does price play any role in your consideration for breakfast?
What factor can make you a possible cereal user?
CEREAL PERCEPTION (Users)
Are you a customer or a consumer?
Who is a consumer? Age?
What’s your reason for buying breakfast cereal?
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With what attribute do you associate cereals with?
First thing that comes into your mind when hearing Cereal?
Do you buy Rice, Corn, Wholegrain??, or Oat cereals?
What are the health benefits of cereals according to you?
Do you think doctor’s guidelines are important before cereal consumption? Can diabetic and
non-diabetic alike people consume it without hesitation?
Do you read ingredients label when making a purchase?
Do you think it is useful for weight reduction, blood pressure maintenance?
What factors do you consider in making a selection for breakfast cereal?
What specific brand do you purchase and the reason to choose that brand?
What variant do you purchase usually?
Do you make a repeated purchase of the same variant or change it often?
How much role a price plays in choosing a cereal?
How much role variants play in choosing a particular cereal?
Are you brand conscious or price conscious?
What factors would lead you in switching to other brand?
Have you ever faced any problem related to cereals?
How often do you purchase it?
How often do you consume it? Daily?
At what time of the day do you consume it?
Is this the only breakfast you do? Or is it usually consumed with other food?
Do you like to buy it from big stores or general trade?
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Does packaging impact your decision for purchase? Do your children pester you to buy
particular brand which you might not have otherwise? What made children pester you? Was
it colorful packaging or any advertisement they might have seen?
MATCO AND FALAK PERCEPTION (5 mins)
Importance of Breakfast / Advantages and disadvantages of breakfast
What significant contribution / role of breakfast in our daily routine? Positive and negative
both.
Have you ever heard of Falak rice?
Have you ever consumed Falak rice?
How do you perceive falak rice in terms of reputation?
If Falak launches breakfast cereals, how likely are you to make a purchase?
If they offer breakfast cereal at a lower price, would you buy it then? (IF NO TO ABOVE
QUESTION)
Do you have any complaints regarding the brand Falak?
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APPENDIX N: QUESTIONAIRRE
SECTION A: Customer Demographics
1. Age
a) 10 to 20
b) 21 to 30
c) 31 to 40
d) 41 to 50
e) 50 and above
2. Gender
a) Male
b) Female
3. Household Income
a) Less than 50,000
b) 51,000 to 150,000
c) 151,000 to 250,000
d) 251,000 to 350,000
e) Greater than 350,000
4. Occupation
a) Student b) Employed c) Self Employed
-
d) Housewife e) Other: _________________________
5. Area you live in: ___________________________
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SECTION B: Breakfast and Cereals
6. Breakfast is the most important meal of the day, your plan for breakfast
a) Regularly b) Sometimes miss c) Don’t eat it
7. Do you use breakfast cereals? (If Yes, proceed further)

a) Yes
b) No
8. When was the last time you ate cereal?

a) Today b) Yesterday c) one-week d) one-month
e) one-year f) don’t remember
9. What is your preferred ingredient?

Least Less Neutral Preferred Most
Preferred Preferred Preferred
Wheat
Corn
Oat
Rice
10. Rate yourself as a user of breakfast cereal

a) Heavy b) Strong c) Normal d) Low e) Very Low
11. How often do you consume breakfast cereal in a week?

a) Daily b) Thrice a week
c) Twice a week d) Once a week
e) No specific pattern
12. Cereal as per your preference (usage)

a) For breakfast only, b) As a snack only
c) Both
13. Cereal as per your preference. (brand)

a) Local brand b) International brand
14. Please mark on a scale which product attribute is important to you

a) Name b) Nutrition Value
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c) Ingredient
d) Price e) Convenience (ease of use)
15. Where do you buy breakfast cereal from?

a) Local neighborhood shops
b) Superstore (Hyper star)
c) Discount stores (Chase, Imtiaz, Metro)
d) Doesn’t buy yourself
16. If purchased from super store or discount store, mention the names
______________________________________________________________
17. Do you feel you get low quality cereals from the location where you buy from?
a) Yes
b) No
18. What option suits you best

a) I visit above selected stores to specifically buy cereal (Focused
purchase)
b) I visit stores etc. to buy general items but buy cereal if I like any
(Unplanned purchase)
c) I visit above selected stores to buy cereal along with general items
(Planned purchase)
d) I don’t purchase cereal but provide input on cereal, and cereal do
come in monthly general items done by a family
member/housekeeper. (Yes Input)
e) I don’t purchase cereal but do not provide input on cereal, and
cereal do come in monthly general items done by a family
member/housekeeper. (No Input)
19. Which statement suits your household best when buying cereals
a) Cereals are bought on monthly basis
b) Cereals are bought on need basis
c) No pattern
20. Which of the following brand you use?

a) Fauji
b) Nestle
c) Kellogg’s
d) Oats
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21. Users of cereal in your household?
a) My self b) Children (Below 10) c) Mother
d) Father e) Younger Brother f) Elder Brother
g) Son h) Daughter i) Younger Sister
j) Grandfather k) Grand Mother l) Elder Sister
m) Other Relatives: ________________________
22. Breakfast cereal is associated with?

a) Children b) Adults c) Both
23. What is important to you in the packaging of breakfast cereals

a) Front side
b) Back side
c) Color
d) Ingredients
e) Price
24. What do you look for in the packaging of breakfast cereals?
_____________________________________________________________________
Section C: Attributes and Variables
Strongly
Attributes and Variables Strongly Disagree Disagree Neutral Agree
Agree
While buying cereals,

my own opinion affects
my purchase decision.

my friends and family
opinions affect my
purchase decision.
sales representative’s
296 | P a g e
recommendation affects
my purchase decision.
While buying cereal,

in-mall advertisement
affects my purchase
decision.

promotions and
discounts affect my
purchase decision.

content/ingredients
affects my
purchase decision.
Taste is
important to
me
Ease of usage is
important to
me
Volume of
product
is
important to
me
Color of the
packaging is
297 | P a g e
important to
me
Color of the
Cereal itself is
important to
me
Crunchy taste is
important to
me
Soggy taste
is important to
me
I will taste the
new product
before buying
Originality of
cereal is
important to
me
Appearance of
cereal is
important to
me
298 | P a g e
Section D: New Product Launch
26. Which statement suits best when using cereal.
a. I’ll stick to one brand and will not switch
b. I like to try new brands
c. I will only try new international brands
d. I will only try new local brands
e. My purchase depends on my experience
27. If you are a user of breakfast cereal which of the following will be most likely the reason
to switch to a new brand
a. Price
b. Ingredient
c. Brand name
d. Word of mouth
e. Advertising
f. Live tasting
28. What is your general price range in rupees for cereal monthly purchase?
a. < 500
b. 500 - 1500
c. 1500-3000
29. Optimal price range in rupees, while purchasing breakfast cereal?

a) 100 to 200 b) 201 to 300 c) 301 to 400 d) 401 to 500
e) 500 onwards
30. Optimal size of cereal pack while purchasing breakfast cereal?

a) 100-gram b) 150-gram c) 250-gram d) 500-gram
e) 1 kg f) Other: _____________________
31. Have you ever tried rice cereal?

a) Yes b) No
32. If Yes, did you like it?

a) Yes b) No
33. Why not use it anymore?
__________________________
34. During a blind test will you be able to distinguish between a corn, oat, wheat and rice
cereal?
299 | P a g e
a) Yes b) No
35. If a new rice cereal is launched which factors you would like to know or to be
highlighted.
a) Nutrition level b) Price c) Taste
36. For a new cereal brand to launch effectively, which reason as per your preference is
important.
-
Strongly Strongly
Factors Agree Neutral Disagree
Agree Disagree
New cereal should
have a new name
New cereal should
have already
established name
Price to be equal to
competitors
Price to be lower
than competitors
Price to be higher
than competitors
Different variant of
rice cereal for
children and adults
For children flavor
is more important
than nutrition
For adults’
nutrition is more
important than
flavor
37. What is your preferred flavor for cereal?
___________________________________________________________
38. Have you heard about Matco foods?

a) Yes b) No
300 | P a g e
39. Have you heard about the Falak Brand or tried the Falak Rice?
b) Yes b) No
40. If you have heard about Falak brand, please rate the Falak Brand in term of
attributes given below on a scale of Worst to Best
Falak Rating
- Quality
- Price
- Packaging
Thank you for time. Have a good day
301 | P a g e
APPENDIX O: PRICE COMPARISON
302 | P a g e
APPENDIX P: FINANCIAL ANALYSIS
Cost of Debt
303 | P a g e
Cost of Equity
304 | P a g e
MATCO WACC
305 | P a g e
Profit 250 gm for Rs. 275
306 | P a g e
307 | P a g e
Profit 500 gm for Rs. 560
308 | P a g e
309 | P a g e
Chapter 19: BIBLIOGRAPHY
310 | P a g e
1. Berning, J.P., Huang, R. & Rabinowitz, A. J Consum Policy (2014) An evaluation of
Governemnt and Industry roosed restrictions on Television advertising of Breakfast
Cereals to Children. 37: 507. https://doi.org/10.1007/s10603-013-9233-1
2. Nicklas, T, O’Neil, C, & Myers, L. (n.d.). Importance of breakfast consumption to

nutrition of children, Adolescents and Young adults: Nutrition Today. Retrieved January
04, 2018, from
http://journals.lww.com/nutritiontodayonline/Abstract/2004/01000/The_Importance_of_
Breakfast_Consumption_to.9.aspx
3. Berning, j., & rabinowitz, a. (2017). Targeted advertising in the breakfast cereal
industry. Journal of Agricultural and Applied Economics,49(3), 382-399.
doi:10.1017/aae.2017.1
- https://www.cambridge.org/core/journals/journal-of-agricultural-and-applied-
economics/article/targeted-advertising-in-the-breakfast-cereal-
industry/966C880008A9490B0C971E3E31E131D3
4. Shum, M. (2004), Does Advertising Overcome Brand Loyalty? Evidence from the
Breakfast-Cereals Market. Journal of Economics & Management Strategy, 13: 241–272.
doi:10.1111/j.1530-9134.2004.00010.x
- http://onlinelibrary.wiley.com/doi/10.1111/j.1530-9134.2004.00010.x/abstract
5. Marketline Industry profile, Breakfast Cereals in United States
- https://store.marketline.com/search/?topic=wmi%3Asubject-
code%3DeYYF&page=6&sort_by=-single_user_price
6. The Monopolies Commission. Breakfast Cereals. A Report on the Supply of Ready

Cooked Breakfast Cereal Foods
- https://books.google.com.pk/books/about/The_Monopolies_Commission_Breakfa
st_Cere.html?id=4fc4ngAACAAJ&redir_esc=y
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7. Eric D. Yordy, Nita Paden, Katlin Bryant, (2014) "Charmingly delicious”: childhood
obesity and General Mills’ dilemma", The CASE Journal, Vol. 10 Issue: 2, pp.125-
134, https://doi.org/10.1108/TCJ-02-2014-0013
8. Mcnulty, Helene & Eaton-Evans, J & Cran, G & Woulahan, G & Boreham, Colin &
Savage, J.M. & Fletcher, Reg & Strain, J.J.. (1997). Nutrient intakes and impact of
fortified breakfast cereals in schoolchildren. Archives of disease in childhood. 75. 474-
81. 10.1136/adc.75.6.474.
- https://www.researchgate.net/publication/14193551_Nutrient_intakes_and_impac
t_of_fortified_breakfast_cereals_in_schoolchildren
9. Helene Hill, Jennifer Tilley, (2002) "Packaging of children’s breakfast cereal:

manufacturers versus children" , British Food Journal, Vol. 104 Issue: 9, pp.766-777,
https://doi.org/10.1108/00070700210443129 Permanent link
https://doi.org/10.1108/00070700210443129
-
10. Kochar, J., Djoussé, L. and Gaziano, J. M. (2007), Breakfast Cereals and Risk of Type 2
Diabetes in the Physicians’ Health Study I. Obesity, 15: 3039–3044.
doi:10.1038/oby.2007.362
- http://onlinelibrary.wiley.com/doi/10.1038/oby.2007.362/full
-
11. Kathryn Webster, (1995) "Breakfast cereals", Nutrition & Food Science, Vol. 95 Issue:
5, pp.35-41, https://doi.org/10.1108/00346659510094026 Permanent link:
https://doi.org/10.1108/00346659510094026
12. Djousse L and Gaziano JM Breakfast Cereals and risk of heart failure in physicians
health study, https://www.ncbi.nlm.nih.gov/pubmed/17954802
13. Liu S1, Manson JE, Stampfer MJ, Rexrode KM, Hu FB, Rimm EB, Willett WC Whole
grain consumption and risk of ischemic stroke in women: A prospective study.
https://www.ncbi.nlm.nih.gov/pubmed/11000647
14. Liu S, Sesso HD, Manson JE, Willett WC, Buring JE. Is intake of breakfast cereals
related to total and cause-specific mortality in men? Am J Clin Nutr 77, 594-599
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https://www.researchgate.net/publication/10887596_Liu_S_Sesso_HD_Manson_JE_Willett_WC
_Buring_JE_Is_intake_of_breakfast_cereals_related_to_total_and_cause-
specific_mortality_in_men_Am_J_Clin_Nutr_77_594-599
15. Stanley, L., & Tschirhart, J. (1991). Hedonic Prices for a Nondurable Good: The Case of
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http://www.jstor.org/stable/2109582?seq=1#page_scan_tab_contents
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16. Nevo, A., & Wolfram, C. (2002). Why Do Manufacturers Issue Coupons? An Empirical
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17. Schmalensee, R. (1978). Entry Deterrence in the Ready-to-Eat Breakfast Cereal

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http://www.jstor.org/stable/3003584
18. Dyson, Lowell K, American Cuisine in the 20th Century
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19. Kathryn Webster, (1995) Breakfast cereals, Nutrition & Food Science, Vol. 95 Issue: 5,
pp.35-41, https://doi.org/10.1108/00346659510094026
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capture and importance of package attributes for consumers' perceived similarities and
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313 | P a g e

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MBA PROJECT 2018

Client: Ms. Wajiha Khan (Matco Foods)

Project Coordinator: Dr. Nasir Afghan

Project Advisor: Dr. Ahmad Junaid

WALEED SALEEM (11830) HERA NISAR (11816)

1.3: Management Objectives

1.2.1 Target Market

1.2.3 Location Strategy

1.2.4 Name Strategy

1.2.5 Price Strategy

1.2.7 Place Strategy

1.2.8 Organization Capacity

1.4: Research Objectives

- To identify the right size of SKU of cereal

- To decide whether rice-based cereals should be launched or corn-based cereals.

➢ Target customers’ segment for promotion activities

➢ Feasibility of setting up plant in Karachi (P&L, Balance Sheet, Projections, IRR,

➢ Final verdict: Whether cereal production by Matco is a right decision or not

2.2.1: Secondary Research

➢ Reports related to market and competition of breakfast cereals

➢ Reports related to Pakistan and Karachi in terms of sales of cereals

➢ Literature review of performance indicators, strategies, unique attributes

Table 1: Secondary Research Variables

A. Health consciousness B. Medical Impact of cereals

2.2.2: Primary Research

Primary research is divided into:

1. Market Survey and Interviews (LMT,

2.2.2.1: Market Survey and Interviews (LMT, IMT, Retailers)

2.2.2.2: Focus Groups

2.2.2.3: In-depth interviews

2.2.2.4: Consumer Surveys

3.2 History of Breakfast cereals

3.3: Today Time - The last 25 Years

3.5: Consumer Perception

To answer this question let us first understand how cereals made:

3.5.1: Procedure to make Breakfast Cereals

d. Drying: Next, the cereal is dried.

3.5.3: Presence of Genetically Modified Organisms (GMOs)

4 Food Safety, WHO: http://www.who.int/foodsafety/areas_work/food-technology/faq-genetically-modified-food/en/

3.6: Approach by producers - Categorization

3.6.1: Breakfast cereals Packaging

McNeal (1969) points out:

It is important to remember that marketing communications should be targeted in such a

Children market segment is becoming sophisticated and skeptical towards advertisements.

➢ Never have a condescending approach

➢ Adopt a straight forward and sincere approach

➢ Acknowledge youngsters for being motivated by rational values

➢ Be personal as much as possible

Cartoon characters in children advertisements are moving beyond on-pack promotions

3.6.2: Brand Awareness

3.6.3: Character Merchandizing

3.7.1: Cereals as Functional Food

3.7.2: Prevention of Heart Failure

3.9: Purchase intentions: Advertisements

3.10: Market Share

Table 2: National Brand Owner company shares of breakfast cereals

% retail value rsp company 2012 2013 2014 2015 2016

Table 3: LBN Brand Shares of Breakfast Cereals: % Value 2013-2016