Operations

Management

Success Factors of Soft Drinks

Manufacturers In Bangladesh

1
 INTRODUCTION

Soft Drinks Industry like other developing and developed countries is getting
much popularity in Bangladesh. The number of firms operating in this industry
is getting increased. The market is also increasing in a greater portion. Today
most of the people in both urban and rural areas are taking soft drinks in a large
amount.

To capture this market many global brands are competing with local brands
now. However the local brands (Mojo and Pran) are much successful even if the
global brands ( Coca Cola, Pepsi) are present.

Our soft drinks industry follows some innovative, strong and continuous
improving production and marketing techniques. Although quality is not the
prime concern of our people, they mainly prefer cost effective soft drinks. The
local companies are competing with global brands on the basis of lower cost.
They are capturing the urban markets by offering some innovative marketing
plan and offer. In rural areas they are very strong in distribution strategy and
price effectiveness.

Our local brands understand the psychology of our people more than the global
brands. Thats why they are showing much more effectiveness in this sector.
Besides, local brands are using technology based production plant with mass

2
production and order to stock basis. Skilled and lower paid manpower, and
innovative marketing projects are also the factors that are associated with
success of these firms acting in this industry.

3
 Background of the soft Drinks Industry in
Bangladesh

In Bangladesh soft drinks are found in some different types, these are:

Carbonated beverage.
Juice or flavored drink
Energy drink

Soft drinks have a huge market in Bangladesh because of the huge population
density derived demand. Most of the soft drinks are of global brand. The
production of the soft drinks is franchise or license basis.

The soft drinks market in Bangladesh consists mainly of seven companies.

No. Name of Manufacturer Brands

1. Abdul Monem Limited Coca-Cola, Sprite, Fanta

2. Agriculture Marketing Company Limited Pran

3. Akij Group Mojo, Lemu, Frutika

4. Global Beverage Limited Virgin

5. Globe Soft Drinks Limited Uro Cola, Uro Lemon

6. Partex Beverage Limited RC Cola, Lychena

7. Transcom Beverage Pepsi, 7up, Mirinda

Of these, Pran and Mojo are the only local brands. Coca-Cola, with its three
varieties, namely, the cola-flavored Coca-Cola, the clear-flavored Sprite and the

4
orange-flavored Fanta, is the number one soft drink producer in Bangladesh, as
well as all over the world. Closing in on Coke is rival Pepsi. Pepsi is one of the
oldest brands in Bangladesh. Pepsi first arrived in Dhaka in 1976 with the cola-
flavored Pepsi, the clear-flavored 7up, the orange-flavored Mirinda and later
introduced the mango-flavored Slice. Pran, on the other hand, started with jam,
jelly and pickle. In 1995, it started producing mango bottled juice, and is
currently operating all over the country. Virgin is renowned worldwide through
its brand name. It was introduced in our country by Global Beverages Ltd. RC
Cola entered the Bangladesh market in 1997, and was the first to introduce the
cloudy lemon flavor. It has not been long since Akij group brought out Mojo
and Lemu. They have already gained huge popularity. The recent success of
Akij group is Frutika, which delivers the promise of no preservatives.

5
General Business model of soft drinks manufacturers in
Bangladesh

The company/manufacturer

Most of the manufacturers of the soft drinks in Bangladesh hold only the license
of manufacturing the products under the brand names or franchisee. Most of the
manufacturers have the production plant of concentrate and syrup and bottling
plant of their own. Most of the company doesnt need to outsource the bottling.
But most of the manufacturers outsource the Raw materials e.g. Sugar,
Carbohydrate, flavor and also the Can.

6
 Competitive Properties

The manufacturers of the soft drinks competes mostly

On cost
On quality
On Flexibility

Competing On Cost:
The competition among the soft drinks manufacturers is mainly on cost. The
Abdul Monem Limited and Transcom Baverages manufacture and sell brands in
relatively higher in prices by offering relatively higher quality along than other
brands. Other brands are competing in market by offering products in relatively
lower price.
Competing On quality:
The manufacturers of soft drinks in Bangladesh have a low competitive force in
market. Some of the brands are offering relatively higher quality in higher price
and some manufacturers are offering relatively lower quality in lower price.
Because of huge demand and ignorance of the consumers of rural area, both are
successful.
Competing on Flexibility:
The manufacturers of soft drinks in Bangladesh have higher flexibility. In
occasions or in seasons, they changed the product offering and bottles getup. It
is very easy to change the product offering to get competitive advantage in cost
or in amount or quality.
Manufacturers of soft drinks sometimes change the bottle size or bottle get up
according to the special offers and special occasions like Eid or world cup.

7
 Strategic Decisions for soft drinks producers in
Bangladesh

Soft drinks industries follow their strategic decisions on the basis of

(1) Make to Stock Product: Soft drinks industries design, produce and
deliver their soft drinks on the basis of make to stock. They forecast
quantity to produce on the basis of information delivered by distributors.
Because the soft drink market demand always varies on seasonal basis,
the companies produce forecasted quantity of soft drinks in different
seasons and store them.

(2) Mass Production: Mass production involves large volumes of standard

products for a mass market. Soft drinks industries produce large volume
of standardized drinks for a mass market. Mass production is usually
associated with flow lines or assembly lines. Flow describes how a
product moves through the system from one workstation to the next in
order of the processing requirements for that particular product. Because
of the involvement of high-tech equipments most of the todays soft
drinks firms follow this production process in their factories.

(3) Human Resources: Soft drinks industries require few skilled human
resources in production. They actually require large human resource in
marketing and other promotional activities. However the labor cost is
relatively low here.

(4) Sourcing: The soft drinks industries in our country outsource most of the
ingredients (sugar, color, can) from outside countries. However some
other ingredients (carbonated water, pet bottles and labor) are locally
sourced.

8
Success Factors for soft drinks
manufacturers in Bangladesh

9
 More Productivity

One way to measure companys effectiveness is productivity. Productivity is the

ratio of input and output.

Productivity=

Here output means the final product. In the soft drinks industry, final product
may be carbonated beverage, Juice or flavored drink, Energy drink etc. On the
other hand, input denotes the parts, materials, labor, and capital and so on that
go into the productive process. In the soft drinks industry, inputs are carbonated
water, sugar, color, flavor, machine, bottle etc.

Productivity measures, depending on the outputs and inputs used, are labor
productivity (output per labor-hour) and machine productivity (output per
machine-hour). Generally productivity is high in the soft drinks industry.
Because both output per labor-hour and output per machine-hour are high. It is
observed that the industry is highly competitive because there are several well
known branded products available in the market. So, companies main focus
always remains into reducing defects and increasing overall quality. Thus, the
amount of good outputs is increased and inputs is decreased which indicates a
better productivity in the soft drinks industry.

10
Standardized and centralized production facility

Most of the manufacturers production facilities are centralized and

standardized. The most of the portions of the production process took place in
the factory and factory yard.

Here is a picture showing a general model of production plant of soft drinks in

BD.

11
 Water is received from the 300 ft. tube-well and it passes through the
water treatment plant, further passing through the sand filter and the
activated carbon filter, so as to attain pure cleansed water.
In the syrup room, the concentrate received from another bottling plant
situated in the factory premises, is blended with the sugar syrup.
Once both the water and the final syrup are ready, they are both mixed
together and sent to the carbonator section where Carbon Dioxide is
added to the mixture to form the final product.
On the other hand, simultaneously, the returnable glass bottles are
depalletized, inspected and washed for the purpose of filling in the final
product in it. This step does not take place in the PET bottle line as the
bottles once used are disposed.
The product is finally filled in the bottles, crowned (in case of RGB)/
capped (in case of PET bottles), labeled and cased in order to be sent into
the warehouse for distribution

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 Management of Supply Chain

The supply Chain of Soft drinks manufacturers can be divided into 3 sectors-

Sourcing
Mixing and
Distribution

Sourcing & Mixing

Water: Bangladeshi Beverage Company collects water from local source.

There is no shortage of water. But company needs to ready the water. One of the
reasons for spreading this sector in Bangladesh is available water.

Sugar: Beverage such as cold drinks, energy drinks etc need raw sugar. That is
not produce in Bangladesh and it is not imported from neighborhoods country.
It is imported from Brazil. Test of the cold drinks, energy drinks depends a lot
on quality of sugar. So, company needs to be much conscious. They have to
predict the demand and calculate the amount of sugar. Then they have to collect
the sugar. In this case they can collect sugar from either importer or direct
importing. Cost of either decision depends. So, company has to decide. If they
decide to buy it from the importer they have to contact with them, negotiate the
price and the time needed to have the product. They have another choice. If they
want to import the sugar directly they have to contact with the foreign supplier,
negotiate the price and set the time. Success or loss largely depends on the
either decision. Sugar posses the largest portion according to cost and amount.
So, company needs much concentrate on controlling sugar stock.

Bottle, can: Beverages are available here in pet bottle, glass bottle and can.
Traditional beverage product especially cold drinks were produce only in glass

13
bottle. But trend has been changed. Pet bottle is relatively new concept than can
bottle. There are different types of bottle and can according to their size and
shape. Pet and glass bottle are produced in Bangladesh. Company can produce
pet bottle or they can collect it from out source. If the produce it they have to
purchase the plastic, machineries, need to available the man power for pet bottle
production. Or they can purchase it from the out sources. Here the need to select
the suppliers, negotiate the price and time to get it. It is also applicable for the
glass bottle. But glass bottle can be reused. So, company needs to strong their
distribution channel so that they can recollect the glass bottle. They have to
purify the bottle in case of reuse. Another way to produce it is can. But can
cannot be produced in our country. It is imported from Korea and other
countries. So, company needs to negotiate with the suppliers and confirm the
supply. To reduce the cost and ensure to fulfill the demand company can has to
stoke the bottle. Demand of soft drinks depends on occasion, trend, season etc.
So, fulfill the sudden demand company has to stock bottle but try to ensure that
the stock should not too large or short. If they stock a large amount then there
may be a shortage of working capital or if they stock too short they may not
fulfill the demand as a result they may loss the customer. So success largely
depends on this issue.

Color: company market their product in several color. They use food color.
They can purchase it from the local market. Here they can use JIT method to
reduce the cost.

Caffeine: company needs to purchase it from the out sources. So, they have to
negotiate with the suppliers, set the price and ensure the supply according to the
predicted demand.

14
Label: Most of the soft drinks companies make their product label in their own
company. To reduce the cost company must calculate the demand and produce
label according to the demand.

Production: in the production section, companies accumulate all the

ingredients and make the final product through a production process. For soft
drinks, here the company needs to predict the demand, ensure the availability of
the ingredients, should have the machineries and human recourses. For cost
reduction company needs to be much concern on production process so that rate
of waste should be reduced.

Distribution

First the company stores the final product in a ware house. They have to
concentrate on the amount kept in the ware house. If the amount is too large
then the carrying cost will be high. On the other hand if the stock is too short
then they loss the customer. To avoid it the company has to build a strong
distribution channel and marketing. From the ware house they distribute it to the
distributor then distributor to whole seller, whole seller to retailer, and retailer to
final consumer. Company uses their own transportation to supply their product
to distributor. Success largely depends on the distribution process. Each stage
needs to ensure to fulfill the demand of the next stage. Demand of soft drinks
depends on season, occasion. So, keep in mind the demand Factors Company
needs to accumulate the recourses and ensure to satisfy the consumer.

15
For the successful distribution of the soft drinks in Bangladesh, the following
factors should be taken into consideration:

Speed: In Bangladeshi market, there is huge demand for beverages and the
cycle time of consumption is very short. So, to be successful speedy distribution
system is required.

Quality of distribution: The quality of distribution is needed to be higher

because of reducing the scrap and return cost caused for bad
transportation/handling.

Vendor Managed Inventory: In distribution, most of the manufacturers

maintain the vendor managed inventory system in distributing the final goods. It
reduces the inventory cost and the most interesting system in the soft drinks
industry.

Most of the manufacturers maintain JIT in raw materials inventory

management. But, they dont hold the finished products much longer but
distributes the products to the distributors who stores and sales the products to
the retailers.

The retailers also hold a huge quantity of inventory to meet the instant demand
of the soft drinks. The huge demand of the soft drinks enables the manufacturers
to maintain this type of inventory management system.

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 Information technology: a supply chain enabler
Information is the essential link between all supply chain processes and
members. Computer and information technology allows real time, online
communications throughout the supply chain management. Technologies that
enable the efficient flow of products and services through the supply chain are
related to as enablers and information technology has become the most
important enabler of effective supply chain management.

E-business replaces physical process with electronic ones. In e-business, supply

chain transactions are conducted via a Variety of electronic media, including
EDI, e-mail, electronic funds transfer, electronic publishing, image processing,
electronic bulletin boards, shared database, bar coding, fax, automated voice
mail, CD-ROM catalogues, the internet, web site, and so on. Companies are
able to automate the process of moving information electronically between
suppliers and customers. This saves labor costs and time. Some of the features
that e-business brings to supply chain management include:

Cost savings and price reductions derived from lower transaction

costs(including labor and document savings)
Reduction or elimination of the role of intermediaries and even retailers
and service providing, thus reducing coat.
Shortening supply chain response and transaction times for ordering and
delivery
Gaining a wider presence and increased visibility for companies
Greater choices and more information for customers
Improved service as a result of instant accessibility to services
Collection and analysis of voluminous amounts of customer data and
preferences. Gaining global access to, markets, suppliers and distribution
channels.

17
 The bullwhip effect:

Distortion information or the lack of information, such as inaccurate demand

data or forecast, from the customer end can ripple back upstream through the
supply chain and magnify demand variability at each stage. This can result in
high buffer inventories, poor customer service, missed production schedules,
wrong capacity planning, inefficient shipping and high cost. It occurs when
slight to moderate demand variability becomes magnified as demand
information is transmitted back upstream in the supply chain. The bullwhip
effect is created when supply chain members make ordering decisions with an
eye to their own self-interest and /or they do not have accurate demand
information from the adjacent supply chain members. If each supply chain
member is uncertain and not confident about what the actual demand is for the
succeeding member it supplies and is making its own demand forecast, then it
will stockpile extra inventory to compensate for the uncertainty.

18
 Not Maintaining six Sigma

In six sigma process, the number of defects in a process can be measured then it
can be systematically determined how to eliminate them and get as close to Zero
defects as possible. But the soft drinks manufacturers dont even try to
implement Six Sigma Process on the operation.

The reason behind this is, the low production cost and high cost of six sigma
process maintenance. The six sigma process will increase the cost than the cost
of lower quality of the manufacturers. Marketing costs of the soft drinks in
Bangladesh costs more than the production cost. And the cost of lower quality is
mostly from the Scrap cost and price downgrading cost which are not that much
against the huge production.

Another reason; six sigma is highly suitable in the high tech manufacturing
process but soft drinks manufacturing in Bangladesh is not of that high tech
Manufacturing. So, itd be costly to maintain quality through six sigma process.

Running a six sigma process will be required highly qualified people in

quality control and highly qualified labor force to reduce the costs. Though,
there are available workforce and labor force in Bangladesh, most of them
arent highly qualified to maintain six sigma process.

So, not maintaining the six sigma process could be considered as a success
factor for the soft drinks manufacturers which reduces the costs in the existing
circumstances of Bangladesh.

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 Less Quality Offering

The quality dimensions for soft drinks industries are

Aesthetics
Conformance
Features
Brand name
Advertising
Safety
The global giants like COCA COLA and PEPSI mostly prioritize on
conformance, aesthetics, brand name and safety.

But the local producers are different.

Local industries do not strongly control quality. They are actually concerned
with marketing and promotional activities as well as are targeting rural market
mainly, where consumers are not much quality conscious rather price sensitive.
Sometimes the rural consumers do not think about taste and brand. For example
Uro Cola has grabbed rural market with their competitive lower price
advantage.

For these types of cost advantages, the local producers are surviving parallel
with the global brands like COCA COLA or PEPSI. Less quality is mainly
supplemented by low product price and aggressive marketing.

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 Less cost of Quality

The soft drinks manufactures do not maintain tighter quality control for the
production of their products. But, they dont have to incur a huge amount of
cost for the relatively lower quality of the products.

They manufacturers dont need to employ well trained labor force to

maintain that six sigma quality.
Product design cost is also less because most of the manufacturers are
licensee or franchisee.
The cost of testing and inspecting is also not that much.
In Bangladesh, soft drinks manufacturers have less use of test equipments
so the cost is less.

The manufacturers of soft drinks in Bangladesh faces cost of poor quality

mainly in

Scrap Cost: - cost discarding the waste products; including labor, material and
indirect cost.

Price Downgrading Cost: - The products which are of poorer quality are of
lower price. For example, RC cola is cheaper than Pepsi Cola or Coca-Cola.

Product return Cost: - All soft drink manufacturers return the products which
get damaged in transportation or in the store of the retailer/distributor and
expired products. Many products get damaged because of Pet Bottling.

Consumer complaint and product Liability Cost: - For the poorer quality or
expired beverages, sometimes it causes injury to the consumers health which
costs the manufacturers the treatment cost of the consumer. But its a rare case.

Lost sales cost: the cost incurred for the lost sales for poor quality.

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Although the manufacturers of the soft drinks have to incur these costs of
quality, its profitable for them not to maintain the quality control so tightly
such as sig sigma process control. The consumer complaint and product liability
cost is a rare to incur for the Bangladeshi soft drinks manufacturers. And the
rest threes are high but not higher than maintaining a large quality control.

The production cost is lower for the soft drinks in Bangladesh. So, the scrap
cost, Price downgrading cost and product return cost is also lower in
Bangladesh. Itll cost more to tighten the quality control. The huge demands in
the marketplace, unawareness of the consumers are also the reason of
maintaining poor quality.

The less cost of quality and the huge chance of serving poor quality beverage
gives the chance to make a enormous profit to the manufacturers of soft drinks
in Bangladesh.

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 Forecasting

The type of forecasting method to use depends on several factors, including the
time frame of the forecast, the behavior of the demand and the possible
existence of patterns and the causes of demand behavior.

Time frame:

Forecasting is either short to mid rang or long range. Soft Drinks Company
follows all of these three methods for demand forecasting. Short range to mid
range forecasts are typically for daily, weekly or monthly sales demand for up
to approximately two years into the future. This method is used to determine
production and delivery schedules and to establish inventory level.

A long rang forecast is usually for a period longer than two years into the future.
A long range forecast is normally used for strategic planning- to establish long
term goals, plan new products for changing markets, enter new markets,
develop new facilities, develop technology, design the supply chain and
implement strategic programs such as TQM. Basically long range strategic
forecast three years into the future.

Demand behavior:

Demand sometimes behaves in a random, irregular way. At other times it

exhibits predictable behavior, with trends or repetitive patterns, which the
forecast may reflect. The three types of demand behavior are-

Trends: a trend is a gradual, long term up or down movement of demand.

In the soft drinks industry the demand of the soft drinks is rising
gradually but during the world economic recession the demand decline
slightly.

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 Cycles: a cycle is an up and down movement in demand that meets itself
over a lengthy time span. Demand of soft drinks rise every summer
season and decline in every winter season.

Seasonal patterns: a seasonal pattern is an oscillating movement in

demand that occurs periodically and is repetitive. Seasonality is often
weather related. Demand of soft drinks rise every summer season and
decline in every winter season. On the other hand during the vacation or
festive the demand of soft drinks rise significantly.

To determine the demand they may use moving average. But moving average
cannot show the real demand. The variation of the result may be large. If the
average exceeds the real demand it will be costly but satisfy the customer. But if
it will show less than the real demand then the company may loss potential
customer. Another way to determine the demand through weighted moving
average. Weighted moving average shows relatively accurate result than the
moving average.

Knowledge:

The competitive advantage of the products, services and technologies is short-

lived. Companies must attract and retain the best thinkers to stay ahead of their
competition. The ability to create, absorb and utilize knowledge is the
paramount skill of the new economy. Those in operations will need to foster
learning communities that can share knowledge across physical and cultural
boundaries. Countries that perform the best in the world market will have the
best research and development (R & D), the best education system, the brightest
people, and the savvy to use those assets to their fullest.

24
 Lower Inventory Cost

The manufacturers of the soft drinks in Bangladesh faces lower inventory cost.
The inventory cost is incurred in two levels, Inventory cost of the raw materials
and the inventory cost of the finished goods. Here, why the inventory cost is
lower, is explained in the following:

Just in Time inventory management In Raw materials:

The raw materials are not stored for longer in manufacturing soft drinks. It is
not possible in sense. The production range is too high but the production
facility is not capable of storing the huge amount of raw materials.

Another point is, raw materials like, caffeine, color, sweetener, carbonated gas
is too costly to store. So, maintaining JIT is reducing the cost of production. The
manufacturers import or collect the raw materials as forecasted demand and take
the raw materials to production as quickly as possible.

Vendor Managed Inventory for finished goods:

This is a very interesting success factor in soft drinks industry that the
maintaining of the vendor managed inventory of finished goods in two phases;
in distributors ware house and in retailers shop.

The finished goods are mostly held by the distributors and retailers. So, the
manufacturers dont need to hold mush finished goods as inventory. So, id
reduces the cost of the manufacturers and considered as one of the success
factors.

The inventory cost is also lower because of the mass production which is
actually supporting the JIT inventory management of the raw materials.

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 Customers Feedback as main quality
management principle

Evaluating customers feedback is very important for the success of all

industries especially for consumer products. Customers feedback means how
positively the customers are interacting with the production, distribution and
promotional activities of a product or service. Customers attitude towards the
product or service depends on various factors. For soft drinks industries,
positive customers feedback may come from products taste, color, quality,
size, packaging or bottling, advertisement, distribution channel etc.

Inventory turnover of retailers and their periodic order in a certain area is a good
measure to understand the customers feedback in that area. However,
sometimes it totally depends on the psychological matter of consumers.

The best way for a firm or company to sustain in the market is to understand
how the customers want the product, its design, appearance, features etc.
Continuous product improvements as well as sustainable good quality
maintaining are the two ways for getting positive customers feedback. If
customers act negatively, it is better to find out why the product is not getting
positive feedback.

For example, Akij Group launched Frutika Juice in 4 flavors primarily.

However Frutika Red Orange could not make appeal among customers. Akij
group however withdrew its Red Orange Flavor immediately. However it still
produces its other three flavor as they got positive customers; feedback. Partex
Beverages Lychina could be another example. People didnt like the leychi
flavored drinks that much.

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 Project Based Marketing

Our local soft drinks brands practically do not follow project based
production process, rather they follow project based marketing activities. Truly
they are very successful in this area. The most pioneer in this area is Akij
Group. They successfully launched different project based marketing
promotions. For example the campaigns like MOJO: Eider Chand Offer, Bucher
offer, Big Bat Wish etc made a great and positive impression on public for
MOJO. Local customers welcomed these types of innovative marketing ideas.

Strong Marketing Activities

Now a days the soft drinks are getting so much popularity also in rural markets
because of strong marketing and different promotional activities. Local brands (
Mojo, Fizz Up, Euro Cola, RC Cola) in line with the global brands ( CocaCola,
Pepsi). Besides local producers are more consumer taste oriented. They
understand the local culture and consumer psychology better than their foreign
peers. For example Akij Group has much influencing promotional activities
(especially different innovative advertisement on mass media) for their soft
drinks brands.

Besides bottling the soft drinks in smart plastic pet bottle attacks the children
and younger generations.

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 Cheap Labor & Workforce

Production process of soft drinks needs a very small portion of labor force. In
distribution and materials collection it needs larger number of workers if they
choose direct marketing and choose to collect raw materials(as; water, sugar,
and other chemicals) internally. The distribution channels also require a large
portion of labor if it is long. The distribution process of beverages industries is
normally longer because of delivering products to the final consumers by
retailers or by their own selves. Most of the time portion of labor cost is higher
in the underdeveloped or developing countries where labor is very cheap
compared to capital cost.

Design for Environment

Design for Environment (DFE) involves designing products from recycled

material, using materials or components that can be recycled, designing a
product so that it is easier to repair than discard, and minimizing unnecessary
packaging. In soft drinks industry product packaging strategies and designs are
totally environment friendly. They use PET bottle, glass bottle, tetra pack etc
for packaging their products. All of these are recyclable. Plastic from PET bottle
can be easily reused. The same glass bottle can be used several times as long as
its not broken. Lastly, as the tetra packs are made of papers they rotted very
easily.

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 Mass Production

The term mass production refers to producing large volumes of a standard

product for a mass market. Here products are made-to-stock for a large market,
demand is stable, and volume is high. Mass production is usually associated
with flow lines or assembly lines. Flow describes how a product moves through
the system from one workstation to the next in order of the processing
requirements for that particular product. Because of the involvement of high-
tech equipments most of the todays soft drinks firms follow this production
process in their factories.

29
 Conclusion

The soft drink producers in Bangladesh succeed mainly because of complying

with the consumers purchasing power and delivering the message to the end
users effectively. Low price is possible in Bangladesh because of easy access to
sweet water and low distribution cost. The cost sensitiveness of the local
consumers makes a strong base of success for the local producers. The low cost
plastic can products become successful in the market rather than glass and
aluminum can products. The consumers are not so much aware of the taste and
features of the products. Another factor is the efficient delivery of the massage
of products and features to the consumers. Sometimes companies engage in
advertising war which increases the marketing cost. The manufacturers also
respond efficiently to the occasional ups and downs of products demand for
example Eid festivals, hot seasons and world cup etc.

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