Dawn Bread

Introduction

Dawn Bread is one of the biggest companies in the bread manufacturing business in Pakistan.

Dawn started its journey in Pakistan in 1981 when it first plant got commissioned to be set up in

Karachi. Shortly after becoming recognized for their ability to quickly cater to the daily changing

demand for bread in Karachi, they chose to expand further and a second plant got commissioned

in 1985 to be set up in the country’s Capital Islamabad. It was after this that the company

became more and more recognized for their quality bread and their impressive distribution in the

areas they focused on, that just two years after setting up a plant in Islamabad, they got two more

plants commissioned to be set up in Hyderabad and in Lahore in 1987. Similarly, after short

periods of time, they successfully set up manufacturing plants in Multan in 1989 and in

Faisalabad in 1992.

Within a decade of entering the market in Pakistan, they managed to capture 35 percent of the

consolidated market share of all the bread products in Pakistan, which is not far from being a

monopoly. Dawn bread has been associated with the Flour Milling and Baking Research

Association (FMBRA UK) since 1990 showing that they use all the processes, technology,

machinery and formulation in line with the international standards.

Vision Statement (Actual)

To be the market leader in convenience providing category by revamping the value chain

processes of our clients organization and by providing integral solutions and convenience in the

lives of our customers and consumers.

Mission Statement (Actual)

We are committed to lead customized paradigms with maximum effect with an aim to benefit

our customers and to make things easier.

Mission Statement (proposed)

Dawn Bread’s mission is to cater to the nutrition requirements of men, women and children (1)

through the variety of bread and related products (2) it offers, which are produced through the

state of the art manufacturing units(4). We operate within the boundaries of international

environmental laws (8) which is the reason we are the market leaders (5) in Pakistan (3), while

our hardworking employees (9) are the reason that we have been able to grow all across Pakistan

(5), and have successfully become a household brand.

Organizational Structure

CPM
Dawn Bunny’s Shezan

Critical Success Factors Weight Rating Score Rating Score Rating Score
Product value 0.3 4 1.2 3 0.9 4 1.2
Highly Qualified Management 0.05 3 0.15 3 0.15 3 0.15
Advertising 0.1 4 0.4 1 0.1 2 0.2
Employee satisfaction 0.1 2 0.2 2 0.2 3 0.3
Market Share 0.15 4 0.6 2 0.3 3 0.45
Quality checks 0.15 4 0.6 4 0.6 4 0.6
Associated with FMBRA UK 0.1 4 0.4 1 0.1 1 0.1
ISO 9001 certification 0.05 4 0.2 4 0.2 4 0.2
Total 1 3.75 2.55 3.2
Internal Audit

Strengths

1. Market leader

2. ISO 9001 certification

3. Associated with the Flour Milling and Baking Research Association (FMBRA UK)

4. Nationwide distribution

5. Provide high value products

6. Highly qualified management

7. High advertising

8. Wide range of varieties of Bread

Weaknesses

1. The packing of bread is manual, that it is done by the worker.

2. Scandal when employees started putting nails in dough

3. Dawn Bread has outsourced all of its raw material used in manufacturing

4. High employee turnover rate (30%)

5. Centralized decision making

6. Have to maintain warehouses in cities far from their factory since they distribute

themselves
IFE Matrix

IFE
Key Internal Factors
Weighted
Strengths Weight Rating Score
1. Market leader 0.1 4 0.4
2. ISO 9001 certification 0.05 4 0.2
3. Associated with FMBRA UK 0.05 4 0.2
4. Nationwide distribution 0.15 3 0.45
5. High value products 0.12 4 0.48
6. Advertising 0.08 4 0.32
7. Highly qualified management 0.05 3 0.15
8. Bread variety 0.05 4 0.2
Weaknesses
1. The packing of bread is
manual. 0.05 2 0.1
2. workers started to put nails in
dough which became a scandal 0.05 4 0.2
3. Dawn bread has outsourced all
of its raw material used in manufacturing 0.05 3 0.15
4. High employee turnover rate 0.1 3 0.3
5. Centralized decision making 0.05 2 0.1
6. Have to maintain warehouses
in cities far from their factory since they
distribute themselves 0.05 2 0.1
Total 1 3.35

According to the total IFE score, Dawn Bread is doing considerably above average internally, in

order to capitalize on the strengths and address the weaknesses. A score of 3.35 reflects a that it

is doing very good internally, however, in order to further increase its internal strengths, it should

more effectively address the weaknesses as their main weakness is their treatment of lower level

workers and employees.

External Audit

Opportunities

1. Increasing trend in Ready to eat (RTE) food

2. Opportunity to diversify in related products

3. Opportunity to open its own bakery

4. Lack of distribution coverage by competitors

5. Lack of advertising by competitors

6. Opportunity to open exclusive retail outlets

Threats

1. Lower barriers to entry in the industry

2. Lower operating cost

3. Customers can easily opt for rival brands

4. Growing trends in bakeries offering fresh baked items (e.g. Jalalsons and Bundu Khan

bakery)

5. Unsatisfied employees can distort the image of the brand

EFE
Key External Factors
Weighted
Opportunities Weight Rating Score
1. Increasing popularity in RTE
food 0.05 3 0.15
2. Diversify in related products 0.05 4 0.2
3. Can introduce its own bakery 0.1 1 0.1
4. Lack of distribution by
competitors 0.1 4 0.4
5. Lack of advertising by
competitors 0.1 4 0.4
6. Can introduce retail outlets for
bakery items 0.05 2 0.1
Threats
1. Lower barriers to entry in
industry 0.1 2 0.2
2. Lower operating cost 0.05 2 0.1
3. Customers can easily shift to
rivals products 0.1 3 0.3
4. Increasing trend in bakeries
offering fresh baked products 0.2 2 0.4
5. Unsatisfied employees can
distort the image of the company 0.1 2 0.2
Total 1 2.55

According to the total EFE score, Dawn Bread is almost exactly at the average, with a score of

2.55. The real reason for a low score on the EFE matrix for the Dawn Bread is that there is a very

high threat due to the increasing number of bakeries in major cities like Lahore, Karachi and

Islamabad, and there is very little the company can do. The company can, however, capitalize on

the above mentioned opportunities, and stay the market leader in the baked goods industry.
SWOT

SO Strategies

-By looking at the strengths and opportunities, Dawn bread should open exclusive retail outlets

sine it has better distribution network

- Should launch new related products as the trust they have gained by providing superior quality

bread over the years would make the launch of new products easier.

WO Strategies

- Since they are maintaining warehouses in far cities they should open their own exclusive

retail outlets that would also work as warehouse.

- Should improve employee morale and give them incentive to retain them

ST Strategies

- Since Dawn is a market leader it should do related diversification and open outlets on the

concept of fresh baking

- Since Dawn pursues advertising very actively, it should advertise of the various quality

certifications it holds and embed in consumer mind to buy from only those bread bakers

who comply with equal quality benchmarks. This would help to raise the barrier to entry

in the bread baking industry

WT Strategies

- Should make the decision making more decentralized so that employees are engaged in

decision making process

 - Should mechanize the packaging process that would reduce the cost of production,

making the relatively new competitors a tough competition

Space Matrix

Internal Analysis External Factors

Financial Position FP Stability Position SP
Current Ratio 6 Competition Price range -3
Net Income 6 Technological Changes -2
Inventory turnover 7 Inflation -4
ROI 6 Risk involved in business -2
FP Average 6.25 -2.75
SP Average
Competitive Position CP Industry Position IP
Market share -2 Profit potential 5
Capacity Utilization -2 Growth potential 5
Control over distributors -1 Barriers to entry 2
Product value -2 Financial Stability 5

CP Average -1.75 IP Average 4.25

FP
Conservative Aggressive

3.5

CP
 2.5 IP

Defensive Competitive

SP
The space matrix shows that Dawn Bread lies in the first quadrant i.e. the aggressive strategy

quadrant, where the most appropriate strategies for a company to use are, ‘Diversification

(related or unrelated), Product development, Market development, Market penetration or

Backward, Horizontal or Forward integration’. Dawn is already engaged in forward integration

as it has its own subsidiary (GB Traders) that does the distribution for Dawn bread to retail

outlets.
 IE Matrix

IFE total weighted score

Strong 3-4 Average 2-2.99 Weak 1-1.99

4 3 2 1

EFE High 4
I II III
Total 3-4

Weighted 3
IV V VI
Score Medium

2.0-2.99 2

Low 1 VII VIII IX

1.0-1.99

The IE Matrix shows that Dawn Bread lies in the fourth quadrant of the matrix, that shows that

the company is ‘Grow and Build’ phase, in which the most appropriate strategies to follow are,

‘Product development, Market development or Market penetration.’

Grand Strategy Matrix
According to the Grand strategy matrix, Dawn bread lies in the first quadrant, in which

recommended strategies are ‘Market development, Market penetration, Product development,

Forward, Horizontal, Backward integration, related diversification’.

QSPM
Open Exclusive Develop
Retail outlets Related
Products
Strengths Weight AS TAS AS TAS

0.04 3 0.12 2 0.08

1. Market leader
0.02 4 0.08 2 0.04
2. ISO 9001 certification
0.03 2 0.06 2 0.06
3. Associated with FMBRA UK
0.02 4 0.08 0 0
4. Nationwide distribution
0.04 2 0.08 0 0
5. High value products
0.03 4 0.12 3 0.09
6. Advertising
0.05 3 0.15 0 0
7. Highly qualified management
0.06 0 0 1 0.06
8. Bread variety

Open Exclusive Develop

Retail outlets Related
Products
Weaknesses Weight AS TAS AS TAS

0.03 0 0 2 0.06
1. The packing of bread is manual.
2. workers started to put nails in 0.05 2 0.1 3 0.15
dough which became a scandal
3. Dawn bread has outsourced all of 0.04 0 0 0 0
its raw material used in manufacturing
0.02 2 0.04 1 0.02
4. High employee turnover rate
0.04 4 0.16 3 0.12
5. Centralized decision making
6. Have to maintain warehouses in 0.02 4 0.08 0 0
cities far from their factory since they distribute
themselves
 Open Develop
Exclusive Related
Retail outlets Products
Opportunities Weight AS TAS AS TAS

0.01 4 0.04 3 0.03

1. Increasing popularity in RTE food
0.06 2 0.12 4 0.24
2. Diversify in related products
0.05 4 0.2 1 0.05
3. Can introduce its own bakery
4. Lack of distribution by 0.04 4 0.16 0 0
competitors
5. Lack of advertising by 0.03 3 0.09 2 0.06
competitors
6. Can introduce retail outlets for 0.02 4 0.08 2 0.04
bakery items

Open Develop
Exclusive Related
Retail outlets Products

Threats Weight AS TAS AS TAS

0.04 4 0.16 2 0.08

1. Lower barriers to entry in industry
0.03 4 0.12 4 0.12
2. Lower operating cost
3. Customers can easily shift to rivals 0.03 3 0.09 2 0.06
products
4. Increasing trend in bakeries offering 0.02 3 0.06 4 0.08
fresh baked products
5. Unsatisfied employees can distort 0.04 4 0.16 0 0
the image of the company
3.07 2.50
Total
Dawn has several viable strategies to choose from. The QSPM reveals that Dawn should follow the
market penetration strategy by opening exclusive retail stores. However, when taking into account
product development strategy by developing related products is still an extremely attractive strategy
but in the long run.

Recommendations

1. Open exclusive retail outlet / fresh baking

2. Should launch new related products
3. Should improve employee morale and give them incentive to retain them

4. Should advertise of the various quality certifications it holds and embed in consumer

mind to buy from only those bread bakers who comply with equal quality benchmarks

5. Should mechanize the packaging process that would reduce the cost of production,

making the relatively new competitors a tough competition