EconomicsProf. Doaa M. Salman

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Ahmed hazaaLamees sabry kamal

Mohamed Abd Basset

• Introduction :-

• EGC – Iceman, it was establish as EGC Egyptian Denmark Company one of the market leaders in the Ice-cream industry after the conflict of the Muslim world and the Denmark for the draws of the prophet Mohamed it was changed to be EGC Egyptian Co for industry.

• In 2011 the company expands their facilities including more 4 factories for Chips, Snacks, Chocolate and Biscuits with a growth in the snacks and biscuits category the company were able to gain a market share and being one of the biggest manufacturing in those categories.

• Objectives:-

• Provide a premium quality with the least possible cost .

• Serve and satisfy our customer needs .• Provide a career growth for our employees and

learning new skills.• Reach a wide range of distributions in urban and rural

area with effective and efficient process.• Identify the brand building area and maximize the

brand existing .

• Market Volume:-• The Market volumes of consumption for both Trade&

Consumers are high in an average of 8 packages weekly .

• Market Share:-• The Company focuses their POS (Point of sales) on the

delta and Upper Egypt area gaining an average of 30% a market share on the covering areas with more than 12 branches in other cities than Egypt reliance on decentralization policy in operation .

• Market Type:-• The Biscuit Market is a very competitive market with

more than 20 Producers and importing companies in the market offering different type of biscuit to different kind of segments in the market.

A Short list for the Competitive in the market :

• Basco Masr ( A Market Leader )• Ulker • Ayman Shain • Americana • Over Seas ( EL Shamadan )

• Company Portfolio:- • EGC – Iceman had 5 different Brands in the market.

EGC

Lanza

Cracky

V.cutPerfetto

Iceman

Our Product:-Lanza is a biscuit Brand with more than 11 sub brand and SKU ( Stock keeping unit ) targeting consumer with in the B and C class with an average age of 8 to 25 years in rural area in delta and upper Egypt gaining a 30% market share in the delta. Factor effecting supply:-• Consumer preference • Distribution power • Marketing and sales ability • Technology • Production ability

Factors affecting demand:-• Pricing • Taste • Availability • Quality

Supply for the product (Production plan ):-• What we have been able to produce in 2014 and 2015 for 3

different sub brands

SKU Production

Quantity

Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Arco

2014 5,365

3,500

6,437

6,450

8,297

8,439

7,217

9,057

11,064

6,566

5,330

3,819

2015 1,271

7,735

9,799

5,004

4,518

11,102

6,877

10,122

16,430

12,803

7,174

10,042

1- Arco Biscuit

4,877 4,000 5,852 5,864 7,543 7,672 6,561 8,234 10,058 5,969 4,845 3,4721

2

3

4

5

6

7

8

9

10

11

12

Series 1

Series 1

Annual quantity sold for both wholesaler and retailer

Consumer Price 12 LE

SKU Quantity Sold

Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual Quantity

Arco

2014 4,877

4,000

5,852

5,864

7,543

7,672

6,561

8,234

10,058

5,969

4,845

3,472 74,947

2015 1,155

7,032

8,908

4,549

4,107

10,093

6,252

9,202

14,936

11,639

6,522

9,129 93,524

Growth Rate

-3,722

3,032

3,056

-1,315

-3,436

2,421

-309

968

4,878

5,670

1,677

5,657

18,577

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec -

5,000

10,000

15,000

20,000

25,000

30,000

4,877 4,000

5,852 5,864 7,543 7,672

6,561 8,234

10,058

5,969 4,845

3,472

1,155

7,032

8,908

4,549 4,107

10,093

6,252

9,202

14,936

11,639

6,522

9,129

2015

2014

2. Marotte

SKU Production Quantity Year Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Marotte 2014

15,732

29,277 25,523

26,501 20,787

10,624 19,496

22,294 22,806 17,987

11,629

2015

14,231

19,427 23,783

19,980 15,616

10,126 11,050

12,343

6,947 12,573

8,026

SKU Quantity

SoldYear Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual

Quantity

Marotte

2014 19,463 14,302 26,615 23,203 24,092

18,897

9,658

17,724

20,267

20,733

16,352

10,572 221,878

2015 7,766 12,937 17,661 21,621 18,164

14,196

9,205

10,045

11,221

6,315

11,430

7,296 147,857

Growth Rate -11,697 -1,365 -8,954 -1,582 -

5,928 -4,701

-453

-7,679

-9,046

-14,418

-4,922 -3,276 -74,021

2. Marotte

14,231 19,427 23,783 19,980 15,616 10,126 11,050 12,343 6,947 12,573 8,026123456789

1011121314151617181920

20142015

Annual quantity sold in 2014 and 2015 for both wholesaler and retailer Consumer Price 12 LE in 2014 18 LE in 2015

Due to the change in the price of the product from 12 to 18 le it decline the quantity sold in 2015 by 74021 pack

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec -

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

19,463

14,302

26,615 23,203 24,092

18,897

9,658

17,724 20,267 20,733

16,352

10,572

7,766 12,937

17,661 21,621 18,164

14,196

9,205

10,045 11,221

6,315 11,430

7,296

20152014

Arco Biscuit Demand Elasticity:

= (93524-74947)/93524+74947) / (( 12-12)/(12+12)/2)) Inelastic relation Arco Biscuit Supply Elasticity:E/S= ((Q2-Q1/(Q2+Q1)/2)) / (P2-P10/(P2+P1)/2)= ((104892-83555)/(104892+83555)/2)) / (( 12-12)/(12+12)/2))Inelastic relation

2 1 2 1

2 1 2 1

( ) /[( ) / 2]Price elasticity of demand =( ) /[( ) / 2]Q Q Q QP P P P

Marotte Biscuit Demand Elasticity:

E/D= ((Q2-Q1/(Q2+Q1)/2)) / (P2-P10/(P2+P1)/2)= ((147857-221878)/(147857+221878)/2) / (( 18-12)/(18+12)/2)0.4/0.4=1 Unitary Elastic

Marotte Biscuit Supply Elasticity:E/S= ((Q2-Q1/(Q2+Q1)/2)) / (P2-P10/(P2+P1)/2)((156117-224670)/(156117+224670)/2)) / (( 18-12)/(18+12)/2)0.4-0.36= 1.1 Elastic Demand

2 1 2 1

2 1 2 1

( ) /[( ) / 2]Price elasticity of demand =( ) /[( ) / 2]Q Q Q QP P P P

Conclusions– The lake of financial resources. – The centralization in the management process .– The lake of the demand planning ( supply chain).– The instability in some of the product quality.– Not following a sales mix between wholesalers

and retailers .– Has no brand image know in the urban areas. – Distribution areas are not really defined.– Focus on selling more than marketing.